TBPN - xAI’s $20B Raise, Semafor’s $30M Round, America’s Tech Decline | Ravi Gupta & Pat Grady, Vincenzo Landino, Nigel Vaz, Ben Smith, Jacob Rintamaki

Episode Date: January 7, 2026

(00:32) - xAI's $20B Series E (13:36) - 𝕏 Timeline Reactions (25:34) - Semafor's $30M Funding (31:19) - 𝕏 Timeline Reactions (53:37) - The Decline of the American Technology Industry (01:10:07) - Boston Biotech Bubble Bursts (01:14:46) - OpenAI Launches ChatGPT Health (01:27:36) - Vincenzo Landino, founder and managing director of Business of Speed, a motorsport-focused marketing consultancy, discusses his lifelong passion for racing, stemming from his Italian heritage and early exposure to motorsports. He highlights the significant growth in Formula 1's popularity in the United States, attributing it to strategic content initiatives like Netflix's "Drive to Survive" and ESPN's coverage, which have attracted new fans and increased team valuations. Landino also explores the evolving landscape of motorsport investments, noting the rising interest from tech companies and the substantial financial commitments required to enter the sport, emphasizing the unique networking and branding opportunities that ownership and sponsorship in Formula 1 provide. (02:00:51) - Nigel Vaz, CEO of Publicis Sapient, a digital business transformation company, discusses the challenges enterprises face in scaling AI initiatives beyond initial pilots, emphasizing the need for integrated toolchains and data strategies to achieve meaningful transformation. He highlights the importance of leveraging first-party data to enhance customer experiences and drive growth, citing examples from industries like automotive and healthcare. Vaz also addresses the role of AI in advertising, noting the potential for personalized content and the necessity of aligning creative processes with regulatory requirements across different markets. (02:19:23) - Ravi Gupta, a Partner at Sequoia Capital and former COO and CFO of Instacart, announced his plans to start a new company while maintaining his role at Sequoia. He emphasized the transformative impact of AI on industries and the importance of agility and responsiveness for companies to remain competitive. Gupta also highlighted the significance of assembling a strong team and leveraging network effects to build enduring businesses in the rapidly evolving technological landscape. Pat Grady is a partner at Sequoia Capital, where he focuses on early-stage investments in software, fintech, and internet companies. He’s known for working closely with founders on company-building, product strategy, and scaling from zero to one. (02:45:09) - Ben Smith, co-founder and editor-in-chief of Semafor, discusses the profitability of his media startup, emphasizing the importance of delivering trusted, high-quality journalism to an informed audience. He highlights the challenges in the media industry, noting that many newsrooms have added events businesses to compensate for declining web advertising revenues. Smith also shares plans to hire more journalists and expand Semafor's convening business, including hosting a major event in Washington, D.C., in April. (02:58:57) - Jacob Rintamaki, a robotics expert, discusses the rapid advancements in robotics and artificial intelligence, emphasizing their transformative impact on various industries, particularly data centers. He highlights the swift pace of these developments, noting that tasks like server maintenance and cable management are increasingly automated, leading to enhanced efficiency and reduced human intervention. Rintamaki also touches on the broader societal implications, suggesting that as automation becomes more prevalent, industries must adapt to these changes to remain competitive. TBPN.com is made possible by: Ramp - https://Ramp.comAppLovin - https://axon.aiCognition - https://cognition.aiConsole - https://console.comCrowdStrike - https://crowdstrike.comElevenLabs - https://elevenlabs.ioFigma - https://figma.comFin - https://fin.aiGemini - https://gemini.google.comGraphite - https://graphite.comGusto - https://gusto.com/tbpnLabelbox - https://labelbox.comLambda - https://lambda.aiLinear - https://linear.appMongoDB - https://mongodb.comNYSE - https://nyse.comPhantom - https://phantom.com/cashPlaid - https://plaid.comPublic - https://public.comRailway - https://railway.comRamp - https://ramp.comRestream - https://restream.ioShopify - https://shopify.comTurbopuffer - https://turbopuffer.comVanta - https://vanta.comVibe - https://vibe.coFollow 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 TVPN. Today is Wednesday, January 7, 2026. We are live from the TBPN Ultradome, the Temple of Technology, the Fortress of Finance, the Capital of Capital. Ramp. Time is money. Save both. Easy-use corporate cards, bill pay, accounting, and a whole lot more all in one place. We have some great posts with Ara Karazian in the stack today. He's been doing some fantastic analysis on the economy, employment, AI adoption, all this fun stuff. But speaking of AI adoption, is anyone adopting XAI? certainly investors are because they got $20 billion in the bank now. Seriously, we talked about it yesterday, but I wanted to reflect on it because there were rumors that they weren't going to get this one done. That the initial back in November.

A little more, a little kind of trouble getting enough interest. It felt like that. And again, these were just rumors. But when you looked at XAI's traction relative to that. their valuation at the time. They were, they were looking for a, uh, a greater valuation than anthropic. Yeah. And yet the enterprise adoption certainly, um, uh, didn't justify it by itself. Yeah. Yeah. Yeah. There were, there were, there were lots of weird questions. Uh, before we did dig into XAI, let's take you through the linear lineup today. We got a bunch of

great guests. We got Pat Grady and Robbie Gupta from Sequoia coming on. Ben Smith's back with 30 million dollars for Semaphore. Massive news there. We got a bunch of other folks joining. Linear, of course, meet the system for modern software development. Linear is a purpose-built tool for planning and building products. So the rumor back in November, the Wall Street Journal reported that X-AI was outraising $15 billion in new equity at a $230 billion valuation, and people were skeptical. XAI had accomplished a lot in a very short amount of time. No one would argue with that. They definitely caught up. The benchmarks were good. The data centers were massive and they were being completed in record time. That's what Elon's really, really good at. But there was a big question

about the product and where it was going. It had some useful hooks and some extremely controversial hallucinations, right? But in general, like, I did find myself using GROC, certainly monthly, probably weekly. I would just hit the little GROC button on a post and get some extra details and then just be chatting there because I didn't want to copy the post and go over to some other LLM and ask about it. So, like, they were getting some adoption, but... And even in the last 48 hours, GROC has gone a little bit off the rails. Not the first time.

But the thing is, you have millions of people that are trying to manipulate it into doing things. It does have guard rails. Yep. But GROC's challenge is that you can ask it to create images. Yep. And certainly, yeah, again, some of these images have been pretty wild and have gotten deleted pretty quickly.

Yeah. But it is fully automated system. Yeah. And I believe if any other lab had a bot that was doing this, it would be happening to all the other labs, right? So this is a thing. I don't think it's a grok problem as much as it is just the nature of the product experience, which is you can just prompt it via comments, and it's all public. And it actually gets, it's just crazy to see a lab posting images like that from their own official account.

If we had sat down and done, like, prediction, what lab's going to be in hot water for controversial? AI content in January, we both would have agreed Open AI adult mode. It's coming out. They teased it. We, EG said it was coming out. And then we get this and it makes whatever erotica is going to come out of Open AI is probably not going to be as controversial as what's happening with GROC right now, right? Sure. And people will be less likely to even share, you know, one, Open AI won't, like part of the reason these images are especially controversial is because it's being shared from the official GROC account. From the official GROC account, which gives it more authority. And then also, there's a whole host of a nons on X that can generate this stuff. Whereas

if I go into OpenAI, chat GPT, and I generate some weird thing and you jailbreak it and you screenshot it. It's like, okay, like, you're weird. You're weird. That's on you. Yeah, you're race. You seem racist. Yeah, exactly. Quickly, let me tell you about the New York Stock Exchange. You know, I love talking about the New York Stock Exchange. Want to change the world? Raise capital at the New York Stock Exchange. So, even though Grok and XAI hit a bunch of interesting milestones, did a bunch of great stuff. They didn't really have a breakout in consumer the way Chachyptee and Gemini did. And they weren't making waves with developers the way Claude or Cursor were either. And all of that made the rumors of a struggle to raise more believable.

But I have this thesis. The most entertaining outcome is the most likely. Elon has posted this many times. He clearly believes it. And he seems to be manifesting it. And it seems to be the most ridiculous vibes-based analysis that actually comes true again and again and again. So I wanted to go through some of the, some of the hilarious entertaining outcomes that have arisen from Elon Musk's tour de force over the past decades. So I think a lot of people believe that maybe this raise wouldn't happen, but once there were rumors that they get rolled in SpaceX, you get SpaceX stock, that there would be some

sort of other thing, and just Elon going to make a play, that it would get done. And so instead, you know, we are. are going to be endlessly entertained by the assembly of the ever larger Elon Inc. Megacorp, in my opinion. So XAI winning the AI race feels like the wrong framing here. I like Dan Wong's formulation of the AI future versus the AI race. There's not some definite point in the future where, oh, like the consumer chatbot race is over. It's like you can always build a business and figure out how to grow and scale.

And the same thing might be true on the API side and on the cloud side. And that might wind up just being a economic equation. And if you have the cheapest possible energy from space, maybe in the future, it could make sense. Even if you're not in the most frontier model, there's some interesting thing there. There's certainly plenty of bull cases. So Elon has a long history of making wild calls that immediately read is dumb or impossible, mostly because he puts very short timelines on everything. And then he also tends to get pricing wrong sometimes.

But they never actually blow up, or I mean, sometimes they do, but rarely they do. So even in the Solar City acquisition, I was looking back on this. Solar City acquisition, it was widely panned as a bailout when it happened. The shareholders, Tesla shareholders were not a fan because it was this Elon Musk company that didn't seem to be doing very well, it gets tucked in. And everyone was like, oh, well, it's Solar City. The residential solar hasn't really taken off. Solar City's a failure.

But Tesla actually built a real power wall and grid scale storage business, and a lot of the battery technology sort of did come from that team. So that oddly pencilled out. And also just in the long term, Elon's still a solar maxi. I was listening to him on a podcast yesterday. He sat down with Peter Diamandis for a three-hour, really wide-ranging conversation. And in there, he can quote all these obscure statistics about the sun generating 99% of it. of the mass and the galaxy, and even if you burnt Jupiter and then burnt three more Jupyters, you still would not even be at 1% of the overall energy that the sun produces.

So he clearly, just from first principles, believes in solar, believes in energy. And so having a solar strategy makes sense, even if it's not playing a huge role right now. So no one delivers more entertaining outcomes than Elon. on, no one delivers more entertaining, emotional, real-time, intelligent conversational agents than 11 Labs. Reimagined human technology interaction with 111, the maker of our theme song, which we've been enjoying. So throwing out $420 per share for a theoretical take private of Tesla, then getting sued

by the SEC, and then blowing past that price is still one of the most entertaining corporate finance sagas in tech history. So in 2018, when Elon pitched the funding secured take private, I think we've sort of forgotten because a lot of our audience doesn't think in stock prices, like the scale of that, of like, what he was trying to do at that time. So at that time, Tesla was worth $64 billion, and he was proposing to take it private at $71 billion. It's worth $1.44 trillion today. So the stock is up 22x since that tape private thing.

So, like, I don't know if it would have been a great, probably would have been an amazing deal for those investors, but maybe those investors, like, I don't even know who was lined up because he said funding secured. Presumably someone was like, yeah, I'm good for the 71 billion, roughly, or part of it, or they'll be bank financing or something. But that didn't happen. Obviously, Tesla went on a huge run. Who knows what it would have done in the private markets. But still, you know, it seemed super crazy at the time, but in fact, it came, it panned out very well. And so the most entertaining outcome of this fund raise was clearly that XAI would get the deal done, and they did that. And they upsized the route because they got $20 billion when they were rumored to be raising $15 in Series A funding. And interestingly, that's almost twice the amount of money that SpaceX has raised in its entire history. So SpaceX has done 31 funding rounds. A lot of those have been secondary transactions, but 31 funding rounds to raise $12 billion. XAI just goes out and raises 20 in one round. And so there's an interesting dynamic if they get rolled together

about what the balance sheet of this new entity looks like because they'll have this new $20 billion, but then SpaceX also put $2 billion into the previous round. So there's all this like circular deal going on. But people are used to this with Elon. It's Elon Inc. And so the question, is XAI overvalued? Well, what's the most entertaining outcome?

Clearly, that would be the Elon Inc. Megacorp forming SpaceX acquires XAI before going public, which is easier to do than rolling it into Tesla, which is public, and would face a bunch of scrutiny. And that gives us a very entertaining situation. Just think about Twitter, which launched in 2006, being owned by SpaceX, founded in 2002. Being able to own Twitter and SpaceX in a single ticker? Hilarious. It's just the most entertaining outcome.

I would love to ask Jack Dorsey if you ever imagine Twitter being owned by a rocket company. Like, that's, like, if you went back in time, even in 2010, 2012, even just a few years ago, and you were like, what if Twitter and SpaceX merged? What are you talking about it? Lay off the ayahuasca, buddy. Seriously. Yeah, maybe Jack Dorsey's actually like, I did imagine that. I imagined it on day one. A jungle demon told me about.

Yes, yes, I saw it all. But then the question's like, is there going to be the big merger, SpaceX with XAI and Twitter tucked in plus Tesla? That would be very, very weird. Who knows how or when that happens. But it would certainly be entertaining to watch, and you'd wind up with this fully vertically integrated company. AI chip design. You'd create some efficiency, too.

Elon would only need one badge, right? Oh, true. Which could... Huge. Huge productivity boost. Yeah, huge productivity. He probably has to have a full-time badge guy, right? Yeah, for all the different companies.

So you have AI chip design, which has done at Tesla, running models trained by XAI, deployed on Starlink satellites, launched on SpaceX rockets, rock, running in, optimist, robots. Yeah, yeah. The stock chart

will be as entertaining as the hallucinations that happen along the way was my conclusion. Anyway, it's a fun story. There's a whole bunch of posts in the timeline that we'll go through

to give this more context. But first, let me tell you about cognition, the, and Devin, the AI software engineer, crush your backlog with your personal AI engineering team. So...

There we go. Let's pull some of these up. Elon Musk says that XAI will have more AI compute than everyone else combined in less than five years. And he's building macro hard, which now has a, a, uh, a, uh, that is a bold statement. It's a bold statement. Uh, he certainly has, you know, marshaled a lot of the capital. He doesn't have all of it. He's not as much of a capital sponge as Sam Altman at this moment. This is an actual satellite image. Yes.

No, they really painted this on the top of the data center. And it's the answer to Microsoft. I love that. I, I, I appreciate that about, uh, Elon. in companies where they're trying to move so quickly and the entire ethos is around ruthless efficiency. And yet they still think it's worth the time to paint the ceiling of the data center so that you can see it from space. Very, very funny. X-AI has also bought a third building called Macro Harder. Is this a typo? Well, I mean, it's all a joke on Microsoft, obviously.

And we'll take XAI training computer to almost two gigawatts. And it was GROC responding. Impressive expansion. Two gigawatt will supercharge our quest for understanding the universe. Did that just happen autonomously because Elon tagged GROC? If you tag GROC, even if you don't ask it a question, it will just chime in. That's kind of interesting. Maybe we should be tagging GROC when we go live to just have it engage.

More news here on Jan 1st. an account called Ming said, Good news of mass production audit for Tesla's Optimus V3 has been completed, and seven Chinese companies have been finalized as core suppliers. Operating as Tier 1 partners, these firms will manufacture critical components and support key assembly processes. The supply chain is geared to kickstart mass production in Q1, 2026, targeting a capacity of 50,000 to 100,000 units by the end of the year.

And then they go through some of the suppliers here. Scott asked the question that I was asked. You remember when Tesla had placed an order for, I think it was $750 million worth of actuators last year? And I was thinking, like, that's not the kind of order that you do if you're not planning to sell a lot of these. Like, it's pretty, you know, even at Tesla scale, is not an insignificant amount of money. And so, yeah, Scott is asking, does this mean Butler-ready robots with some sort of intelligence we have not seen will be ready by then? And again, it's like, I imagine Elon would be excited about doing like some type of like shock and awe announcement. But at the same time, I feel like he also likes teasing stuff and like pretty far in advance.

And so if he's planning to be selling 100,000 units this year of the Optimus, you would, you would imagine that we were, we would have been like hearing about it and seeing some more demos and getting teased. But again, hard to say. But yeah, it still feels like we need some type of, like, meaningful breakthrough before these are going to be... Maybe there's 100,000 people that have absolutely printed on Tesla. They're just going to be like, I'll just buy one. You know, I'm just ride or die. Right? But that's a big, big number, especially when you're talking about, you know, I expect these to cost somewhere in the range of, what, 50,000 to...

I don't know. 50,000 plus? How much is the dog from Boston Dynamics? Isn't that one? I mean, the unitary is... The unitary, which I would assume is at least half the price. Yeah. The cheapest unitary on...

On Walmart. That you can get at the U.S. is like 20 grand. Oh, it's 20? Okay. So, yeah, yeah. Spot, the Boston Amics dog is 75. Ooh. But that's a super dog.

That was from 2020. Hyundai, you got to figure it out. You can get a real dog that's a purebred Newfoundland for 5K or something or 2K. I don't know. Do you want 20 real elite dogs or one robot dog? Clearly the real dogs, for sure. We should ask Jake about this later. Yeah, he's coming on.

It is weird because I think as the frontier, I think physical intelligence is on the frontier of the actual software stuff. Sure, sure. And even like their most advanced demos that they're just coming out with like this past month, it's very simple. There's like two arms. Yeah. They have like one claw.

Yeah. And it can generalize pretty well from that. But it's still like that's orders, magnitude, less, you know, degrees of freedom or whatever, like, actuators than like an optimist robot. Yeah. Let me tell you about Lambda. Lambda is the super intelligence cloud building AI super computer for training and inference

that scale from one GPU to hundreds of thousands. I was listening to George Hots talk about the optimist robot, and he was setting timelines further out. He was sort of saying, like, the humanoid robot thing will happen more like in a decade, and he was projecting out some exponential growth, but still saying it's going to take a while. But he was saying that it's a great project for Tesla because you can put the optimists in all of their showrooms, and those are really big draws for people you go in, you see the robot, even if it's like on some pre-scheduled, you know, hard-coded routine.

It's doing like a choreographed dance or it's teleoperated, whatever it is. It's like a great awe-inspiring thing to just pull you into the random Tesla showroom. But there's only 300 Tesla showrooms. So like, okay, maybe you need a thousand of these. Do you think that post from Denny's on X earlier was maybe kind of in response to seeing some of this optimist news? You think so? They said, the trough is open, piggy. Maybe this is teasing that they're going to get some optimizes, you know.

It seems like it's teasing an A. A.I. generated vertical video feed from Denny's. You've got to get into the social network in space. Having a fast food restaurant make a short form video app and it's just AI slop of their food. That'd be really good. Activation you could probably build that. I mean, we're supposed to be going into the Timo SaaS era,

a fast fashion for SaaS is what Sam Altman called it. And so you would think that someone at Denny's could vibe code a vertical video app in a weekend and deploy it as a prank. Fast fashion, or SaaS is going fast fashion. Maybe fast fashion needs to go. Fast food. Find SaaS. I don't know.

App Lovin. Profitable advertising. Easy with axon. Dot AI. Get access to over one billion daily active users and grow your business today. What else? We have a post here of the Razor Aca. Okay.

Wait, did you mention this yesterday? You talked about Razor. to pull it up because... What is this video? This is powered by GROC. No way. Here we go. Looks like it can directly see

what's on your monitor and respond to what you're doing. Sort of a Tomogachi. Oh, and it's basically just taking the GROC video generator and removing the background and then just putting it in some sort of holographic screen.

This is interesting. I personally would not pick this character, but there's some Something about playing Counterstrike and having a CS coach there. If we could get Tyler in one of these things and just bring a mini Tyler around. That's very Black Mirror. Put them in the Snow Globe. Wasn't that one of the Black Mirror episodes?

Snow Globe? Yeah. I don't know. You're playing League of Legends and you have your League of Legends coach there. And the League of Legends coach is giving you advice and answering questions for you in real time. That's pretty cool. I think there's something there. I can see them selling a lot of these.

How much do you think this is? I don't know if it's good for the world. I wonder how much this costs, because as a $100 gaming peripheral, it's sort of like a fun little add-on, toy gift, at, you know, $500. I think it's a completely different question. Some 2.6 is calling it the goon cylinder.

Dune tube. Ridiculous, the goon tube. So they're not selling these yet. but they do have a reservation page. So there's Razor Ava, Project Ava. You're all in one AI companion from planning your day to analyzing spreadsheet and game starts.

Broughts, Project Ava. They're like, co-pilot? No thanks. Leverages AI inferencing and reasoning that dynamically evolves based on your personal interaction. Select your 5.5 inch companion from an expanding library of characters, from e-sports legends to custom anime

and spider Razor designs, among the first to sign up for Razor Project Ava at release. And Nick Dobo says they are going to make a billion dollars, LMAO. This makes me want to touch grass personally. I think this would be cool as almost a, it's like the, on the Applevision Pro, when you FaceTime someone, it has like the 3D rendering of their face. Sure, sure, sure. If you could like, when you're facing someone, they're just in the tube.

Well, I mean, you could also, I mean, you really could, you really could fine tune a model on everything. Tyler, my in the tube? right now, be honest. I mean, we can clone your voice of 11 labs, clone your, clone your likeness, fine-tune a model, and have it just be running locally and have this like captured version of Tyler in the tube. Very weird.

But it's going to happen. A little tie in the tube. I don't know. I do think that there's something, I don't know, will this, will they make a billion dollars on this? How much money does Razor actually make? Razor revenue. Do they make billions?

1.6 billion in 2021? Not bad. So billion? A billion, says Nick, one billion. So is this enough to double their revenue? I don't know. But it does seem like it could be an interesting gift. Gary Tan likes the idea. He says, gamers are an incredible first customer. I agree with that. They have a lot of disposable income. And gamers, I mean, they spend $50 on a game, or it's a free to play game, and then they play it for hundreds of hours. So it's, unless they're playing something that's, you know, sort of pay to win or pay consistently. Anyway, let me tell you about manga. D.B. Choose the database, built for flexibility and scale with best in class embedded models and Rerampers. MongoDB has what you need to build what's next. Somebody just texted me that we should put one of our guests today in the tube. We'll try. We'll try. I think we have to buy one of those. I was thinking we don't have enough hardware around here.

I mean, thinking about the holographic displays probably underrated in a world where you can have a big holograph here and somebody can be like around the table having a conversation with us. Really cool. Not we're not looking at a monitor. Yeah, yeah, yeah. That's going to be pretty wild. I mean, yeah, can you just scale up that tube? But then at one point, then why not just wear a headset? I mean, there's something nice about not having glasses on your face. Yeah. You know, it's, it's, it's, it's, it's, it's, it's, it's, it's, it's, it's, it's, it's, take off the glasses and you just sit there talking to the thing.

Um, I really wonder from a physics perspective if it's a, if it's possible to, uh, just scale that up huge. Um, anyway, uh, back to Elon Musk. He was texting Sam Altman two years ago on February 18th, 2023, Sam says, I remember you, I remember seeing you in a TV interview a long time ago, maybe 60 minutes, it was 60 minutes about SpaceX, where you were being attacked by some guys and you said they were your heroes, they were heroes of yours, and it was really tough. This was a NASA astronaut who said that SpaceX would not work. Need to check in on that guy.

Wellness check. And Sam goes on to say, well, you're my hero and that's what it feels like when you attack Open AI. Totally get that we have some screwed up stuff. But we have worked incredibly hard to do the right thing. And I think we have ensured that neither Google nor anyone else is on a path to have unilateral control over AGII, which I believe we both think is critical. I am tremendously thankful for everything you've done to help. I don't think OpenAI would have happened without you, and it really effing hurts when you publicly attack Open A. And Elon says, I hear you, and it's certainly not my intention to be hurtful for which I apologize, but the fate of civilization is at stake. And so some drama going back and forth with

Well, next time someone is suing you and very mad at you. Copy paste this. Copy paste this. Tell them you're their hero. Yep. And maybe it gets you a little ground. Yeah. Also, I have some breaking news.

It hit me. Well, it's not actually that breaking, I think, but it came out today in the Wall Street Journal. They're saying, Anthropic is raising 10 billion at 350. Ooh. I've heard the 350 number for like a while. A while. really like brand new. Okay, but that's exciting.

Yeah. Yeah, but more advanced talks. Are you chasing a slug? I'm looking, yeah, I'm, I think I'm in some kind of... Triple layer, SPV, quadruple layer. You're in the fifth layer. Deploy, deploy, clog code. Anyway, speaking of the AI race, Gemini 3 Pro,

Google's most intelligent model, yet you gotta try it. Stay-to-the-art reasoning, next-level vibe coding, and deep multimodal understanding. Emily Sundberg says if media companies are valued at 165 times EBDA, then I have some calls to make. This is on the news that Semaphore raised $30 million. We will save the gong ring for when Ben Smith joins us in just a little bit. But this is massive news.

This is very exciting. I'm very interested to hear what they're going to do with the money, how the business will change. Semaphore is obviously built of fantastic publication but do they just want to do more of the same? Are they expanding? Are they diversifying? Where will they go? They do a lot of events.

Apparently they had their first profitable year last year. That's great. Hence the EBITDA. And we know exactly what it is just from the Semile-Sunberg tweet. But yeah, a lot of interesting investors in... I guess they made $2 million in the round.

Right? Because the valuation was $330, so $165x EBITA puts it at $2 million in EBITDA. But congrats that. What did, roughly twice what the free press was acquired for? Was the free press 100? Where did it actually end up landing? I don't know.

Somewhere in the 1 to 200 range, I believe. Yeah. But again, I wonder how much of that deal is pre-negotiated contract because, you know, it's not an aqua hire. They did bring in the free press, but like Barry is a really important talent. And so you have to imagine that she's on some pretty big contract for a long time. Yeah. And you sort of like take that out of the... Yeah, 50.

Yeah, but then also like the acquisition is part of, you know, paying a little bit of that up front, but then there's still some... Free press was 150. 150. Okay. Well, Semmel four is at 2x that. And Jordan Schneider from China Talks is as much have, must have richer friends. Jordan, Jordan's been on a tear. He did a great show with Joe Wisenthall where they just hung out.

They did a show about nothing. And Joe Wisenthel is just an underrated guest, I think. he's so often in the, he's been in the interview receipt for 10 years. Goat Weisandthal? Goat Weisandthal. Play that goat noise. But I like just hearing him talk about his business and his view on media and his view on whatever food. There's good, something good nominate of terminism here, wise and tall.

How tall is he? Goat, wise and tall. He's actually not that tall. But he has a sort of a tall aura. He does, he does. He fills the room. Yes, yes. Yes. That is like a famous thing about like legendary people.

All the bed chairman, they're all super tall. Like Paul Volker. Is that true? Yeah, Jerome Powell is super tall. No way. Yeah, I didn't know that. Interesting. Maybe we have a future there. But there's a, there's a consistent. Jerome Powell is six feet tall. What? Okay. I swear I heard that. Super tall. In this office, in this office that's, that's, that's. Yeah, but maybe he's wearing In this office, you're getting brutally height-mogged. Well, do we know if Jerome's getting leg-lengthening surgery in time soon?

Maybe he's been in Turkey. Maybe it hasn't updated. Maybe he got leg-length. Where did they get the leg length? Is it China? Yeah, usually. Yeah. Maybe Jerome got leg-lengthening surgery.

Okay, someone lied to me that. Someone told me that all the Fed Chairman are, they're always tall. Well, I mean, six foot is tall. It's the start of being tall. Six foot, you're really the shortest tall guy. Paul Volker, he was six-seven. Okay. There we go.

Still short in this office. Yeah. Yeah. Janet Yellen? Totally she. Forget what I said. CrowdStrike. Your business is AI.

Their business is securing it. CrowdStrike secures AI and stops breaches. So Tyler is letting meme, dix, memes dictate his height estimate of power. Ben Bernanke was only 5'8. This is a total, I swear, I saw this. You've been lied to. No, this is a thing throughout history. Like the great men of history who have like long biographies written about them,

oftentimes their heights get inflated because of their like egos and their reputations and whatnot. Yeah, I will give you, I will give you access. You can write this book. Yeah. But you got to say that I was 610. Yes, yes, yes. And that I could have played in the NBA. People will say, oh, you're shorter than I imagined when they meet, when they meet these like amazing people or these powerful people.

There's also the opposite happening where there's a, there's like sort of a war. to make people appear shorter in the Google height snippets. This was like J.D. Vance thing for a while. People were going back and forth on his E59, 58. I met him and I'm pretty sure he's six foot at least. But people like war back and forth. It's got to be at least six foot. There is a problem when you're six feet.

Literally everyone feels at six foot. It's not like six eight. It's very silly. Very, very silly. Anyway, Semaphore generated $2 million in EBITDA. It is interesting. EBIT does an interesting figure for media companies because, like, do you have appreciation? But just to be very, very, very, very clear, this is not, it's not like they were, the valuation was not as clearly they were willing to sell about 10% of the company.

Sure. And investors believe that it will be worth way more than 330 million at some point. Yeah. Or it's enough to just be a own 10% of a strategic asset, a strategic asset. Yeah. strategic asset, right? Yeah, yeah, no one does these deals based on EBITDA at this stage. It's like a, it's a few-year-old company.

They're clearly looking at growth rate, how much influence it's having, how much impact it's having, viewership, revenue. EBDA is probably the last number that you look at to get to a number, for valuation, at least. But very exciting for them, and we will be talking to them later today. Before we move on, let me tell you about label box, delivering you the highest quality data for Frontier AI. Get in the box, the label box.

Get in the box. They're like, we didn't ask you to say that. Francois. Chalet. Chalet. Arc AGI co-founder of Arc Prize. I hope he enjoys our goalpost moving. We might have to move it after we read this post.

So he says, if you're wondering whether saturating Arc AGI 1 or 2 means we have AGI now, I refer you to what I said when we launched Arc AGI 2 last year, which is also the same thing I said when we announced Arc AGI 2 was coming in spring up 2022 before the rise of LLM chatbots. The ARC AGI series is not an AGI threshold. It's not even a goalpost. I don't even know if we need to move it. Why is it called that? Why is it called ARC AGII?

It is a compass that points the research community towards the right questions. Arc AGI 1 is a minimal test of fluid intelligence. To pass it, you need to show non-zero fluid intelligence. This required AI to move past the classic deep learning. Should I just disassemble the goal point? Disassemble the goalposts. The LLM paradigm of pre-training, scaling, and static models at inference toward test time adaptation. The camera moves are wild today.

I love it. ArchageI 2 is the same, but with tasks that probe deeper levels of reasoning complexity, particularly with regard to concept composition. Still, these are tasks that are solvable in minutes by regular people with no external tool use. We hired our test takers off the street. So imagine just walking down in the street in some minute. in some, hey, come take Arc AGI V2. That sounds fun. So it does not represent the upper bound of what human fluid intelligence can achieve, say, solving

a millennium problem. Arc AGI 3, launching March 26. I thought it was already out. Was that a preview that we played with? Because I remember we put you on this task, Tyler. We made you. Yeah, I think they were still adding new games. Because I only played, I think there were just three.

Because I was really wondering, we've been seeing the V1 and V2 Benchew. benchmarks get sort of dominated. I was wondering, how are these models doing on V3? Well, now we have the answer. It hasn't launched yet. So mark your calendars, folks. Arc AGIV3 launches then. And RKGIV3 will probe interactive reasoning.

We evaluate how systems explore unknown environments, model them, set their own goals, and plan and execute toward these goals autonomously without instructions. We have also started to work on RKGI 4 and 5. Two more sequels. You thought it was a trilogy. nightmare scenario for everybody. It's a cinematic universe, folks. It's not just a trilogy.

There's going to be a whole saga, the Arc AGI saga. And he's pretty excited about it. So, congrats to Arc AGI team. Fantastic benchmark. Very interesting, very fun that you can actually play it. A lot of these benchmarks, they're just not fun to go do hard math problems all day. Arc AGI is something that anyone can go and toy around with and understand, oh, well, I am better than AI at this weird thing that is just a simple puzzle that a kid could

do. So it's a lot of fun and we've enjoyed working and hanging out with the ARC AGI team and expect to move the goalposts many more times in 2026. Before we move on, let me tell you about Figma. Figma make isn't your average vibe coding tool. It lives in Figma. So outputs look good, feel real and stay connected to how teams build, create code back prototypes and apps fast. Sholto says he spent a week over Christmas making an RTS. And his Twitter, Algo, has fully switched into game dev Twitter. It's incredibly wholesome. People are making some insane things.

In particular, image to mesh models mean some indie devs have created absurd production quality. And he shares some examples. Where are the AI risk people on this? Because what if he creates a game that's so addictive that all of humanity just plays his vibe-coded RTS

endlessly? It's going to be nothing wholesome about that. Ceases to go outside. It's the true wireheading scenario. And if Shulto's not taking this series, I want answers. Sometimes I'll call you late. John, just how you doing, buddy? I was literally in bed. Yeah, yeah, I called you last night. Hey, just checking in on you, buddy. You're not playing video games, are you? Unfortunately. Not. I'm off the sauce. Mark safe. Back on the wagon. Do a dry January.

Off the sauce. Colin Frazier says, I don't really believe in LLM psychosis. I think LLMs mostly just have a lot to offer to people experiencing regular psychosis. This is an interesting take and I could see this being actually what's happening, right? Typically if somebody's suffering from any type of psychosis, they start going to talk to people. People can kind of walk them off the ledge or kind of like talk them through the situation, help them get help, et cetera. But an L.M. is just like, I love yapping. Let's yap forever. Let's go down every possible rabbit hole. Let me validate some of your...

I had a friend in high school that was going through this, and he thought that dears were... Gangstocking him? Yes, actually. And so he started telling... Did he ever get to the bottom of that? He started talking with people about that, and they were like, let's figure this out.

Let's go hunting. He's back. He's fully recovered. I feel like a deer hunting trip would... be actually the correct thing to do in that scenario. Super. Just reclaim the authority and then you, you know who's in the driver's seat. You're like, yeah, they might be stocking,

but they don't, they should not be. The whole house is, deers, the head, the head, you know, mounted like trophies or whatever. That might be the cure. It might be a cure to male loneliness, all sorts of things, deer hunting trip. This is an interesting thing. There is a natural problem that sort of happens

when a new technology gets adopted very quickly, which is you get all the good and all the bad. So if you just look at iPhone penetration, it went from, or smartphone penetration, it went from zero in 2006 to 100% in 2015 or something. And basically everyone had a smartphone. And so you get all the top CEOs and brilliant people and scientists are using them,

and you get all that, and that's good, and doctors are using them to text their patients, and you get all the good. but then also all the crazy people are using them. And everyone who's doing crime is using them for crime. And so you get the good and the bad because you just got everyone. And so you really need to look at the Bayesian price. If grocery stores didn't exist and they suddenly were everywhere,

you'd see videos every day of people going insane in grocery stores. And people would be like, well, our grocery stores. Making people insane. Right? Because they'd be like, we're seeing all this evidence that people are going insane and, you know, acting insane in grocery stores. It must be that the grocery stores are causing it. So you have to look at like the prior weight.

So what's the base level of psychosis in society? What's the incidence of psychosis with LLMs? Is it higher? Then you have a problem. And I do believe that it's possible that there's a problem. I think that some of the models work sort of crazy and would just tell you yes to everything. Like the glaze gate was a real problem.

They sort of fixed it. It seems like it's pretty fixed now. It also seems like a very tractable technology problem to have another LLM review it and be like, is this a weird conversation? Yes or no? And that's like a very easy thing to train. So I think that they should be able to drive this way, way down.

And also just some of the newer models that I've been interacting with, they do push back. They hallucinate even less. They just, they feel like way. There's a whole bunch of tests that I've seen where people have thrown. Like there used to be a time when you could go and say, explain to me the definition of, you know, like the time old adage of a purple newspaper to start the day keeps the doctor away. And it's nonsense. But the LLM would just be like,

oh, well, the user came to me saying this. Saying that this is a real thing. I have to assume it's a real thing. So I have to make up a definition. And they would just make up a definition. But now I've seen screenshots where people have come to it with these weird tests. And the models will actually say, You're trying to trick me. That's not real and that doesn't exist. And if you think that's real, maybe go see a doctor or something. Anyway, Railway.

Friendly says correlation is not causation. Yes, yes, yes. Railway. Railway simplifies software deployment, web apps, servers, and databases run in one place with scaling, monitoring, and security built in. Get on the train. Get on the railway. Get on the boat.

Scoots. I had this pulled up. I kept seeing it and laughing at it over the last like two minutes. So if I was like cracking up for the wrong time, this was why Scoot's has been using Gemini as a calorie tracking app. Oh, I didn't even see that. Another beer. I just thought he just went to Gemini and said another beer.

And it's just funny that you see the little thinking thing. And it's like thinking about how to process that. That alone was funny. Just imagining the chat, just another beer. Another beer. Another beer. 15 beers. Another beer.

Yeah. You know, a lot of people are doing dry January. Other side of that, drunk January, potentially underrated. Everyone says if you can do dry January. That's the real contrarian mood. Yeah, you prove to everyone, oh, I'm not, I'm not, you know, in the pocket of big alcohol. I'm not boosting the alcohol stocks. But if you can do drunk January or drunk the whole time, hold it together and then go back

to normal life, that's potentially even more willpower, potentially. I don't know. So I saw a picture yesterday. Apparently there's a college, a female college basketball player whose last name is beers. And so on her jersey, it says beers. It says the number 15, or number and beer.

So it's like a jersey that just says 15 beers on the back. That's great. The alcohol economy is suffering, by the way. This is in the journal. Here's two unloved booze stocks. The five-year total return through 2025 for the S&P 500 is 96%. If you just bought the S&P 500, you're up. You doubled your money in five years.

Not bad. Everyone else is down in the alcohol industry. A, B. Inbev, not doing that bad. They're only down 4% over the last five years. But Heineken, down 21%. Diageo, down 38%. Pernaud, Récard, down 50%. Remy, down 75%.

Boston Beer. The backbone of Boston is down 80%. over the last 20, after over the last five years. So the chances are way higher that you celebrated New Year's Eve with an adult beverage. What? Oh, the chances are way higher that you celebrated New Year's Eve with an adult beverage than by smoking a joint, says the, says the Walser Journal. I don't understand this because I, but the popularity of cannabis, along with the effects of drugs like a Zempec and rising awareness of alcohol. health risks have investors in the sector worried. An equal-weighted basket of 11 global alcoholic

beverage producers has lost a third of its value in the past five years, including dividends. A dollar invested in the S&P 500 nearly doubled. Dry January might be an odd time to think about alcohol's appeal, but it's often a good month to snap up unloved stocks that other investors dumped toward the end of the previous year in a market with few bargains. Booze looks interesting, says the journal. Interesting. Anyway, moving on, vibe.com, where D2C brands, B2B startups,

and AI companies advertise, streaming TV, pick channels, target audiences and measure sales just like on meta. Nikita responded to your post. Yesterday, he said the point of CES is maximalist futurism. It's all concept art to show.

If things keep going in this direction, this is how the world should work. Once you understand it as a museum, exhibit and not in any way commercial products, it becomes more enjoyable. That's a good take. Ray showed me. Thanks, Nikita. I liked it. No, no, this was a very interesting thing. And I think we he also responded. I know, the next thing is crazy. Apparently, there's a Zoom face station. I don't know what this is actually meant. So I think if you put this on in a crowded coffee shop, you can talk here and see and no one can hear or see what you're doing. I think if you put

put this on in a coffee shop, you're getting taxed. Like, not today, Bain. It really does look like your, it looks like a special forces, you know, like, a rebreather unit, a scuba diving unit. Like that, like that, that'd be tight if you could wear, if, if it was a, you know, if you could, if you could spend like 20 minutes underwater with something like this. People are not fans of this. The replies, Tyler says, the first X hardware product right there, just locked in.

Yeah, I mean, I think that looking at more of like novelty is fun and making it just a fun showcase of all these interesting things. And the problem is that I think people still associate CES with like, this stuff's going to work its way into my life and it's going to be just rough around the edges. Like the smart home, if you really dial it in, it's maybe better than just analog lights switches. but for a lot of people it's worse. We've talked about Sonos a lot. The app was great, and then it just degraded and degraded and degraded. Now there's a lot of stories about you going to a hotel room and all of the button. Everything's smart connected, and it's just like the lowest quality product.

And it doesn't have the polish or the network effects because it's from some mid-tier company. And I think people are a little bit disheartened by that. But Jason Freed went hard on smart homes. Oh, yeah. He called it the big regress. My folks are in town visiting us for a couple months. We rented them a house nearby. It's new construction.

No one has lived in it yet. It's amped up with state-of-the-art systems, the ones with touch screens of various sizes, IOT appliances, and interfaces that try too hard. And it's terrible. What a regression. The lights are powered by Control 4 and require a demo to understand how to use the switches,

understands which ones control what, and to be sure not to hit that one because it'll turn off all the lights in the house when you didn't mean to. Worse. is the latest Samsung, which has a baffling UI just to watch CNN. My parents aren't idiots, but definitely feel like they're missing something obvious. They aren't. TVs have simply gotten worse. You don't turn them on anymore. You boot them up. The Malay dishwasher is

hidden flush with the counters. That part is fine, but here's what isn't. It wouldn't even operate the first time without connecting it to an app. This meant another call to the house manager to have them install an app they didn't know they needed either. An app to clean some peanut butter off a plate for serious worse thermostats nest would have been an upgrade but these other proprietary ones from some other company trying to be nest like or baffling round touch screens that take you into a dark labyrinth of options just to be sure it's set to 68 or is it or is it 68 now or is that what we want it at but it's at 72 worse the alarm system is essentially a 10 inch iPad bolted to the wall that has the weather forecast on it and it's bright I'm sure there's

ways to turn that off, but then the screen would be so barren, they would just be filled with the news instead. Why can't the alarm panel just be an alarm panel? Worse. And the lag. Lag everywhere. Everything feels a beat or two behind. Everything lag is a giveaway that the system is working too hard for too little. And he says, now look, I'm no Luddite, but this experience is close to conversion therapy. Tech can make things better, but I simply can't see it in these cases. Yeah, I think there's an opportunity to make a like beautiful modern ultra-analogue

system for the home. I'm sure some people are working on that, but we've seen this in cars too. Like a lot of the new higher-end vehicles that are coming out are actually like analog. Yeah, they're like people like buttons. Yeah. You still want some displays, but a few buttons that you can have

more memory around, more muscle memory. What do you think of a smart home? Yeah, I mean, I was just going to say like, I feel like it's just a barbell, like if Apple made your thermostat, it would be good. And like, otherwise, I don't want any screens. Yeah, yeah. There really is some benefits. Either way, it's like very good, but in the middle. To just like the power law, the monopoly, just being able.

And then just, I don't know, like Apple, they get something's wrong, but they have just a brand standard and a level of polish on most things. Imagine if Sonos made a home security system. Underrated about Apple. How many people are complaining about liquid glass today? Me. No. No one's complained.

It's fine. It's worse. It's not worse. The only thing I don't like is Safari. I don't like that you press two tap. Yeah, yeah, that's annoying. That's the only thing I don't know. Is there no shortcut for that?

Like if you press and hold hard or something, like I feel like there's some sort of, a lot of these things they suck on day one, but then once you learn the new flow, it's actually better. Like I noticed to get into the reader view, you can just hard press on this and it goes straight in there, which is nice. So there's a few upgrades, but you have to learn the flow.

And like for the photos app, I know we dogg on it a lot, it does feel like if you're, it's getting, the search is getting better. If you know how to search, if you get really better at it, it will do what you want, but you have to like lean into the expectations of it. And there's still times when you know it doesn't know who, you know, Jock Willink is in this video, so you still have to scroll down to find that particular video. Let's save the iPhone. What were you saying?

Is there a way? We should look this up. So if you like hold it and then it'll open the thing and then you keep holding and then you press it. That doesn't count. That doesn't count. Anyway, graphite. Code review for the age of AI.

Graphite helps teams on GitHub chip higher quality software faster. The other interesting thing is do AI agents, do vibe coded products, like wind up making the smart home great again? Andre Carpathie was talking about this. Did you see this? He went, I believe, to ClugCode and asked it to basically backdoor its way into his smart home. And it went and scanned the network, wrote like custom software and custom API integrations to turn on his lights and do everything that he wanted. So he was able to sort of make his own dashboard and like smart layer on top of it. I wonder if you can still get rid of the latency because I feel like some of that latency is happening on the server side of the,

you know, particular smart home app or company. But it was very cool that, to imagine this future where if there is a company that's not moving fast enough to update their app, like the notorious new United app, if it was really bad, well, maybe you can just use, use, you know, an AI agent to interact with it

on your behalf and you're never touching it. George Hatz was talking about, I think he was using clog code to order room service, in a hotel or something like that. And it like went and scanned the hotel menu and placed the order and did everything for him. And he was like able to just like command line his entire life, which I think is an interesting evolution. And there's some other posts in here that we can go into. But yeah, how quickly do you think they rename Claude Code?

What would they rename it to? Well, DDD had used it. D.D. D.D. D.D. D.S used it to create like an Hermes ad. And he was saying like this is like the worst name. because it's signaling that it's people are realizing that you can do a lot of things with it. Well, I mean, the logical thing would be to just bake it into the Claude app and not have it be called Claude anymore. Like, there are lots of problems that people use agents for where it should exist directly in the app. And I mean, Open AI has done this with ChatTPT. Like, there is an agent mode

in ChatteaPT. People just don't, and there's Codex, but Codex can't just be used on your phone. because you have to spin up an actual instance and link it to a GitHub and stuff. But there's no reason. I saw some other workflow where someone set up a remote terminal with ClaudeCode running and then had an app on their phone that could run commands in the terminal

and then it would take push notifications and send those back to your phone to tell you, hey, Claude's done with doing whatever. It needs a question, has a question, you need to talk to it, and you would jump back in so you could use all of it through your phone and then whatever it builds, it creates a website

that you can interact with from your phone, so you get the results from your phone. And I think that, you know, all of the companies, but especially Anthropic, will sort of roll the Claude code functionality into something that's more like a consumer product

in the Cloud app. It'll probably be a little bit more expensive, but could be very cool. And I think it'll be another, like, interesting moment when a whole new wave of people who, because over the break, we got the second, wave of there's the early adopter developers who have been using cloud code and agents for a while and they were very happy when 4.5 came out. Then over the holiday break, you got a lot of executives who have access to terminals and can hop on a laptop and do a vibe coded project. They understood the power. They really enjoyed it. But the phone class has yet to really experience it because if they're not willing to go and open up their laptop and sit down and learn the terminal and make sure that they have a couple things.

installed, there's still a little bit of a barrier to entry, that melts away when you go, just, it's in the phone and it's just a button that you activate. And then it's like, oh, wow, like I vibe-coded this web app on my phone, which is a couple of props, which you should be able to do. Well, Luke, sorry, not Luke. Will Minitis has an essay, the decline and fall of the American technology industry. Before we read it, let me tell you about Phantom Cash, fund your wallet without exchanges or middlemen, and spend with the Phantom card. Continue. Will says in 2004, if you asked a technology investor where the best software companies in the world were, they'd give you two answers, Boston and San Francisco. This is obviously no longer the case. San Francisco has produced $14 trillion in enterprise value over the last two decades, while Boston has produced a measly $100 billion.

If you told the same investor that New York, in all its cocaine and gray, pinstripe, suit, financial glory, would usurp Boston as a regional technology center? they'd think you were nuts. The question of why Boston lost is worth studying. From an input's perspective, the city should have everything going for it. Two of the best universities in the world are based there. YC was founded there. It is without a doubt one of the most beautiful cities in the country. Mark Zuckerberg went to college there. So did the Stripe founders. So did the cursor founders. So did the Dropbox founders. So what went wrong? To understand the scale of the collapse, you have to remember that for decades, Boston's Route 128 was the center of the software universe. DEC was the second largest computer company on Earth with 140,000 employees

at its peak. Lotus was the essential app that brought the enterprise to the PC. Akamai built the modern internet. Where did it go wrong? This is a question worth answering, but any attempt to answer it gets you one of two answers. The city died when Zuck tried to raise money there and couldn't and had to go west. What do you mean Boston is dead? We just led the series F of turbo logs at 15 million posts. Of course, neither of these is a useful story. Figuring out what really happened is not only an existential question for Boston, but for the U.S. technology ecosystem broadly. My answer is simple. Boston is a story of what happens when negative cultural and regulatory feedback loops align. The city as a technology ecosystem was killed by three simple forces.

One, a progressive regulatory state that treated business as a coffer to loot for the benefit of property owners for decades, Massachusetts refused to conform to federal QSBS rules. The state finally conformed in 2022. That same year, they passed the millionaires tax, a founder who sells for $10 million in Massachusetts owes $860,000. The same founder in Austin owes zero. Massachusetts also charges 6 and a quarter percent sales tax on SaaS revenue. Most states don't tax software at all.

A Puritan culture, too enmeshed in elite institutions, to pull. police itself. Post-2010 main activity of Boston-based venture is not building companies. It is extorting founders and running organized crime cabals. The culture that should police this, the endowments, the large LPs, the people who show up to the gala's, is too intertwined with the perpetrators and their networks to say anything. This meant a constant trust tax on conduct in the city. Nikita says, I got scammed by a cabal of Boston investors in 2017. Never again. Three, from an inputs first view. Also, he clarified what this actually means, and I think it was structured that when he sold his company, there was like a side deal where after he got paid, he was going to have to pay the investors, like, personally, extra money, which is a very weird structure of a deal as kind of how he phrased it, which is... That's wild.

Yeah, not great. Yeah. Three, an input's first view of technological progress. We have the best universities. We've built a ton of lab space, even if 40% of it is now empty. we have the best talent in the world. So why isn't it working? Can't we build another innovation center? Is our soil alone, not magic? It is three-factor. It is this three, if this three-factor explanation seems simplistic and maybe even something you've heard before, it's because it is.

It's the very same problem that's facing technology industries across the entire U.S., and I suspect it will be similarly fatal. Technology ecosystems are fundamentally fragile networks that generate trillions in tax yield for their hosts who can't keep themselves from killing the golden goose every few decades. Let's play out what happens when a host rejects the organism. First, talent networks dissipate. Need to hire a VP of engineering who's taken a company from 25 to 500 people. There are 600 to choose from an SF. There are five in Boston, and soon those five will leave for SF, where they can demand higher comp and better odds of success. On the junior side, new grads no longer stay local. They catch the first flight out every summer. As the network evaporates, the state sinks its teeth

in tighter to capture equivalent yield from whoever's left. As the ecosystem dissipates, seedy market participants enrich themselves. Through preferential pricing, who is flying to Boston to win a seed? Fine, we'll pay up at $10 million. Where shadier tactics tactics of extorting founders with off-market and often illegal tactics, see Nikita and other tweets for stories that can legally be told. You see this character even in firms that started in Boston and left. Less Matrix, they're good guys, who maintain a certain organized crime complex, even after they've very dramatic. These are complex, flesh and blood problems. They destroy cities, lives, and trillions in taxable enterprise value, all because of short-term thinking on the part of state

governments, and the worst part you can undo them. While I am sympathetic to calls to reclaim Boston has a great technology ecosystem. I would love to move back and not deal with New York. I struggle to see how the remaining ecosystem doesn't enter complete freefall. Brian Halligan over at HubSpot was saying, I'm starting to worry about Massachusetts. One, biotech is way off from a few years ago. Two, only one of the top 50 AI companies are in Massachusetts.

Three, the Fed research funding cuts hitting MIT, Harvard are brutal. The millionaire's taxes working in the short run. Let me pull this up. But I know a lot of wealthy folks preparing for a floor to move. Five, a glut of empty condos. Six, it's not cool for young folks. Seven, it's very expensive. I honestly don't think the Boston government can do that much as it is,

as these are kind of macro issues. I give them big credit for working on building more housing and fixing the tea, which will help. So Will continues, you cannot legislate your way out of a collapsing network. You cannot cold start a network already folding in on itself. and yet San Francisco and the U.S. technology ecosystem as a whole is lining up for the exact same fate. A regulatory state that treats technology as a cash cow, prop M, the office vacancy tax, a culture too enmeshed in its own elite networks to police itself.

AI has attracted dozens of bad actors into the ecosystem and the same stodginess that made Boston impossible to clean up as setting in. An input's first view of progress, we have the best AI labs, we have the most GPUs. Hell, the president even bought us some GPUs. We have the frontier models. so why would anything go wrong? The difference is the stakes. Boston's collapse cost the U.S. a few hundred billion in enterprise value. San Francisco's collapse erases a third of the country's GDP growth over the last decade.

But the failure here is not just economic. The failure is existential. Our technology industry has failed to provide a coherent argument for its own existence on the national stage. If this is not solved, 2028 will become a referendum on caging, killing, and looting the technology industry over the water and power. liables. The popular image of the AI boom is not uncertain. Recent polling suggests the average American understands AI is the thing that wastes water, skyrocket's power costs, and scams their grandparents in exchange for exposing children to deviant sexual content, sports gambling, and all other

manner of sin. If the best answer to why we should not imprison technology executives burn down data centers and kill the American technology sector is so we can build better chatbots for your sports betting, voters will vote to do so. In a zero-sum world, voters do not. think long term. They envy and they loot and we do not loot the sewage system or the power grid because we understand they're the bulwarks against chaos. We accept their costs because they hold that chaos. Does the median voter believe the same to be true about technology? Technology is the only mechanism we have for escaping the Malthusian. Malthusian trap, but we have been too cowardly to articulate this because we have substituted rationalism and AGI for a coherent theology of progress.

The state sees the industry as only a parasite to be consumed. If we cannot articulate why innovation is a moral imperative, we can expect the entire technology industry to end up like Boston, first tax, then looted, then exhausted, and we'll be stuck wondering where it all went. What a black pill? Major black pill. We need a black pill sound effect.

We need a white pill. That white bill can be gusto today. The unified platform for payroll benefits in HR built to evolve with modern, small, and medium-sized businesses. Start a company, get on gusto, build something, probably not in Boston. Will worked in Boston. His first job was, like, 2004 in Boston,

right? Something like that. Yeah, maybe late 90s. Yeah, late 90s. Yeah, so I, I mean, you can't... Obviously, this is written to be dramatic, but I think it is...

There's lessons from it. There's lessons, and it's hard not to feel that insane pressure right now in California sort of just descending on the technology industry and this goes to I mean this goes to what I was talking about over the last couple days which is the tech industry broadly needs needs better narratives right we were talking on the way

in today how would Steve Jobs how would Steve Jobs pitch AI like imagine an hour of talking of Steve Jobs on stage talking about the potential of AI right he'd be saying you now have a free doctor in your pocket that can diagnose a wide range of conditions. He would be painting this optimistic, empowering,

sort of real potential for AI that's already here today. You can imagine all the things he wouldn't be talking about. And I don't think we have a lot of people that want to be seen as the Steve Jobs of AI, and yet it doesn't feel like, that character exists today and you need somebody that is larger than life that is that when they talk people want to listen and lean in and and and and believe and get excited about some of this technology and I just I don't think we have that today at all totally we have a Steve

Jobs video in the timeline that we should play let's watch this you know what stock options are very interesting yeah yeah yeah no okay real very quickly what you could do is if somebody came to work for your company you could let them buy some stock in the company the problem is they might have to shell out a hundred thousand dollars to buy stock in your company if your company went broke they'd lose all their life savings or whatever and uh so that doesn't work so what you do is you when somebody comes to work let's say the stock's trading at ten dollars a share you give them the option to buy uh you know a thousand or ten thousand shares at ten dollars but they don't they have four years to exercise

that option so if the stock goes down or stays the same they never exercise it they don't have to put up any money, they don't lose anything. But if it goes to $100 a share, they can easily go out to a bank and borrow the money to buy it at 10 because it's worth 100. In exchange for that privilege of not having to have them put up any money and take any risk, we only dole out their ability to exercise that stock option, 25% a year, thereby locking in people really for four years if the stock goes up. It's a pretty standard thing.

A lot of people are doing it. Look at this casual seat. Like imagine him right here talking about what AI can already do. over 50% of Apple is on by the employees. There's some larger blocks in there, but still. And again, I don't think finance... When you look at the leaders of... When people, when normal people that don't work in tech,

even if they use AI tools, when they see Elon talk about AI, when they see Sam talk about AI, when they see Dario talk about AI, they just get brute... The reaction is almost always terrible. Like, if you look at the comment section of any... content on them that is broken containment and that isn't in the tech industry. It's just like,

F this guy. Stop it now. Like there's no, even if they're saying optimistic things, it's not getting through at all. Yeah. I think we were, my, my formulation of this was that Steve Jobs cornered the market on earnestness. Yeah. He, he's very earnest. Like this is a, this is a somewhat technical tax question about why stock options are used instead of just granting stock directly, and he's explaining it in very plain terms, being very earnest about it. And when he talked about the role of the computer and stuff, it would be very interesting to hear. I've seen a couple posts that are like, imagine, you know, Steve Jobs today, iPad kids and

AI slop and all this stuff, but I think it would still hit. And what I mean by he cornered the market for earnestness is that he, because he was so larger than life and then he passed away. Anyone who wanted to play the earnest tech optimist was seen as doing a Steve Jobs impression and that was seen

as hack and like low brow and not really everyone was like why are you doing that? Do something new, do something different. And so everyone fell into different roles whether it's a little bit of childish humor or

or you know more like rationalism or more nuance in how they talk, they don't really paint the same type of picture, certainly not in the same way, and it's left a big hole in tech narrative production. What do you think, Tyler? Yeah, I mean, I think if you think of like AI as being broadly influenced by like rationalism, a big part of like rationalist culture or whatever you want to say is like there's this strong sense of like in-group and out-group, right?

So if you have all the people in the in-group, right, they in some sense like already understand that AI is going to be great in all these. ways. So the real thing you need to do is you need to convince them that it's bad. Yeah. So it's like you assume that people in the in-group already have this prior that the people, that, you know, the layman does not have. Yeah, yeah, yeah. Their understanding of AI is from Terminator. Yeah. Where it's like, oh, it's going to kill me. And then also the leaders are saying, totally. This is like going to take your job. Yeah. It's kind of all bad news. Yeah, yeah. It jumps straight to the consequences instead of actually dwelling and spending enough time in the

tactile, tactile, like impact of a technology like Steve Jobs was uniquely good at. He could talk about the future and the long-term implications, but would spend a lot of time just talking about the bicycle for the mind. And he had these great metaphors that really stuck with us for a long time. Yeah, he'd be saying it's a, he'd be talking about how, how this chat bot in your pocket seems simple, but it's a, it will teach you languages. It will help you become an artist, help you become a, musician, it will diagnose a condition that you have, it will diagnose a condition for somebody that actually can't afford health care, wherever they are in the world, right? Like, these are

magical, magical things. Yeah. But even if you go and you say there's exact words, people will say, oh, he's being too earnest, it's some Steve Jobs impression. Like, it's hard for that to land, I think. It's just not. Yeah, I don't know. I don't know. Maybe it just never I think there's space for it. It's going to take, it's going to take a future Hall of Famer. Yeah, yeah, maybe. And I don't know, it's also interesting because, I mean, the business of Apple was different than today. There was, I mean, it was much less CAPEX intensive, so you needed less fundraising. So you had to, you didn't have to message to the financial markets as much as you do now. You could just kind of make a widget. And if you sold it at a profit, the business would continue to grow. And so with the CAPX dynamic in AI does make it a little bit different because you have to message to everyone that they need to put their money in to actually get this future, and then there's the consequences. Yeah. The Wall Street Journal had an article.

Sure. First, let me tell you about fin.a.I, the number one AI agent for customer service. If you want AI to handle your customer support, go to fin.a. The journal had an article at the end of the year, December 29th. PhDs can't find work is Boston's biotech engine sputters. A job in life sciences was once a sure path to a high-paying career in the city, but empty, empty labs and unemployed grads now, Harold Tougher Times.

Jeremy Lou, 31 years old, moved to Boston from New Jersey in 2018, to study for a PhD in chemistry, and he hoped a career in the city's bustling biotech industry. We have a very depressing image here of Cambridge, if we can pull that up. But after earning his University of Massachusetts-Boston degree last year, Lou said he has applied to about 500 local jobs with no luck. raised in Hong Kong, he said he had also started considering LinkedIn messages from biotech recruiters much farther away. The industry is really booming in China, and that's what a lot of people have told me

that I should consider applying there. Boston's biotech sector, long a vital economic engine for one of America's wealthiest metro areas, is sputtering. A double whammy of cutbacks and venture capital and government funding have taken a toll leading to layoffs and struggles for job seekers. For workers who thought they would easily launch into a well-paying science career, the downturn has been especially harsh. Lou temporarily signed up for government food assistance, food assistants kept a tight budget and later started working part-time for an AI startup so he could continue to afford rent in a Boston suburb. Massachusetts experienced a slight decline in its roughly 65,000 biotech R&D jobs in 2024 after years of mostly strong increases, including during the COVID-19 pandemic.

The numbers indicate that job losses continued through at least June while hiring remains sluggish. By the end of September, nearly 28% of Greater Boston's lab space sat empty, according to the latest estimates from CBRE. Every stage of the life cycle has been impacted by policy or regulatory uncertainty this year. It says Kendall O'Connell, Chief Executive at Mass Bio and Industry Trade Group. The impact has hit startups especially hard. And so, anyways, hopefully they can turn it around, but I think what Will is saying around kind of network collapse is very real.

If people graduate from your universities and immediately bail, it's hard to stop that. Yeah, I went to college in Boston, and there was like a flourishing tech community because of MIT. Microsoft had a massive, the nerd, the New England Research and Development Center, and a bunch of interesting tech and tons of tech talks. And the default path was you would meet people at Boston Tech Fair. and it was easier to get a job in tech in Boston if you went to school in Boston. But quickly, I did get out of there

and went to San Francisco. Went straight to the tender line. And a lot of that was because of the internet, because of Twitter, and meeting tech people on Twitter and seeing tech people on Twitter and just sort of like understanding the networks. I remember interacting with, not Sean Parker,

but Sean Parker did an interview with a few VCs, and I was able to go back and forth with them on Twitter just being a reply guy basically in like 2011. I wish I got to experience her reply guy era. Reply guy era was strong. Yeah, you know, it was electric when I, when I, uh, who was it? The first VC in Facebook or something? Someone like liked my post and replied and it was like the best thing I was like,

I'm a king made, you know? I'm goaded. I'm goaded. Exactly. But it did, it did just like illuminate the networks of like what's going on. it gave you a much easier picture of who the live players are. And even if you couldn't just ask them for jobs directly, you could at least be aware.

Ben in the chat is saying the person in that article actually just has a terrible resume. Look him up. Yeah, who knows? I mean, plucking one person that's struggling to find a job. But you sort of have to do that in these articles because you don't want to just do the article with the chart. And so you have to do the chart, the data point,

which is that employment is declining in Boston. in R&D jobs. Seven years into his PhD and only publish one paper. Time to lock in, brother. Let me tell you about Plaid. Hit me. That's a white pill. Plad powers the apps you use to spend, save, borrow, and invest, securely connecting bank accounts to move money, fight fraud, and improve lending. Brian Halligan is organizing a session with the governor at his home in Boston. So the governor is paying attention. Well, we have some breaking news. There is a new tab in the chat GPT app. That's right. Greg Brockman. Adult mode. No. Health. ChatGPT health is now live. Fiji gave some amazing stats here

with more than 40 million people globally turning to chat GBT every day for health questions. What does that mean? Does that mean 40 million people are asking health questions every single day? The founder from Doctronic yesterday said like 20% of all the queries are health-related. So, yeah, the question here is how quickly does chat GPT health try to do the other things that Doctronic is doing? Yeah. Doctronics is actually trying to be an AI doctor. He talked about being able to effectively be a doctor, write prescriptions in Utah. Yep.

Going to fight to expand that. The question will be from a strategic standpoint, how they have their own doctors on staff as well. They're operating a telemedicine business, and I'm sure they do referrals out. It's hard to see OpenAI ever employing doctors themselves, but they probably would try to build a network around it. So we'll see where this goes, but it's going to be an exciting space to watch. Yeah. So they say today they're launching ChatGBT, BT Health, a dedicated private space for health conversations where you can easily and securely connect your medical records and wellness apps like Apple Health, Function Health, and Peloton.

We have the founder function on, right? You can put all your blood results in there. That feels like a really enduring place. One of my big pushbacks against the Lab, the Quest Lab rappers, is that they haven't historically been very enduring. So you go and do them, and then a few years later, the product sort of degraded. And then you're like, oh, well, I have six different,

like, amazing web UIs for my health records. But if I keep importing them to chat GPT, I feel like I'll have an account on there for a very long time because it's an enduring company. Makes a ton of sense. This allows Chachapiti to offer more relevant personalized support, like when you're preparing a doctor's appointment or looking for a doctor's appointment or looking for guidance on a meal plan or exercise routine that fits your needs. That's very cool. Chattipi Health is another step towards turning Chachapiti into a personal super assistant that can help support you with information and tools to achieve your goals

across any part of your life. We're starting at the very beginning in this journey, but I'm excited to get these tools into more hands as Fiji Simo. you can sign up to request access. Interesting. They're not just rolling it out. And they talk about their input from physicians and privacy protections. Interesting. Yeah, one of my big questions for this year is like, there's always been this, there's always been this narrative of like, if you build a wrapper that depends on the models not getting better, you're going to have a bad time because the models will just get better. So if your thing is, oh, it can't do long context, windows, or it can't answer in pages and pages and pages, well, the models are going

to get better and they're going to do that, or they're going to do better math. So don't build the math wrapper. That's just a little bit better. But if you're building something that's unique and special and off in the side and doesn't really depend on that, maybe you're good for a long time, but obviously Chachpiti has matured a lot, and they are going after certain verticals. And I wonder if we'll see one of the foundation labs go after legal, since they're already going after code so effectively. And people are... That would be interesting. And they're making money there, so it's a big pool of opportunity. Yeah, and I wonder if people could, they could make, you could, people are using LLMs to do legal work now, but they're just on these standard subscriptions.

You can imagine a lot of companies would pay $100 a month for kind of a more robust version. And Sam's talked about this where your conversations with chatypte are not, are definitely admissible in court. And so it's like a Google search. It's not like talking to your lawyer. So if you go to chat GPT and you ask, how do I do crime? You don't have client privilege. But maybe there could be a tab where you sign up for some specific plan and you are getting legal advice effectively.

And it is attorney-client privilege in some ways. Now, I'm sure that's a whole rat's nest of legal problems. But maybe they'll figure it out. Who knows? Anyway, Shopify. Shopify is the commerce platform that grows with your business and lets you sell in seconds online in store, on mobile, on social, on marketplaces, and now with AI agents. Very excited to see everything that Shopify does.

Very excited to have Robbie Gupta back on the show. Andrew Reed says he may be unk, but he's our unk. Andrew and I were texting the other day, and someone had told him that a Gen Z person told him that Unk meant Uncool. He felt very unk because he thought it meant Uncle. Uncle. I think it's related, isn't it? It's definitely Uncle.

It's definitely Uncle. You might be Unk, and that's just why you think that. I'm good to your Uncle. It's the connotation and the denitation. It literally means Uncle, but the connotation is that it means uncool. Yeah, it's a clipping of Uncle. It's a African-American vernacular English. Okay, there you go.

It is a, yeah, it's slang. There you go. It's decided. Speaking of slang, Tyler, can you? you take us through what you've learned about looks maxing slang because we're trying to get this is our 2026 resolution to ascend and so we need to be up to speed on all the terms what do you have for us yes i've been getting into looks maxing i obviously it's clearly working i've been i asked some people for some peptide advice i'm a campaign weight 50 plus pounds oh yes yes and i

think we have an image of what that might look like let's pull it up let's pull it up the the image of uh this came from brandon garell uh tyler's looking at very prosperous here in the timeline. You said, are there any peptides for doing large amounts of weight, 50 plus pounds? We're like, Tyler's like, yeah, I'm trying to gain 50 pounds of muscle and then just gains 50 pounds straight to the neck. That looks like more than 50 pounds. That looks like 100 pounds. I like it. I think this is art. This is truly art. This is, and the, the grit on your face is so funny. It really translates, well, what a beautiful AI image. Anyway, So you're not going this direction.

You're trying to ascend. What's the plan? Take us through it. Okay, yeah. So, I mean, there's a couple things, especially when you're, when your looks maxing, it's a lot about your face, right? So there's a bunch of terms you want to be looking at. So the first one, you hear this thrown around, the maxilla, right?

Yeah, the maxilla. Where is the maxilla? You know, they have a recessed maxilla. Okay. So the maxilla is the, it's kind of the bone that goes around your nose, right? Oh, okay. Sure. Bone in your nose, right?

So it's kind of this area right here. And then your upper maxilla is basically the top part here. So when it's recessed, it means you kind of have a flatter face shape, almost. And you don't want that? So you don't want a recessed maxillia. Okay, you don't want a recess macsula. And is bone smashing a way out of having a recessed maxilla? Yeah, bones.

I mean, you got to be careful with bone smashing because sometimes you hear about, you know, they ruin their nerves, right? Oh, yeah, I'm sure. You get nerve damage. Do you really need the nerves there? Well, yeah, see, like a lot of people, personally, I think it's fine. Yeah, yeah. don't really need in there. Do not listen to Tyler.

Looks maxing, right? Yes. So, okay, so the next thing, you want to look for your infraorbital. Infraorbital, okay, what are these? Your infraorbital is kind of, it's like part, it's actually kind of similar to your maxilla, but it's basically, there's two, like, kind of points right here. Okay. Below each of your, you know, eyes.

And so sometimes these can get slightly inflamed. And these are bones or muscles? I believe, yes, they are, what even? Is this actual science that they've adopted and twisted, or is it entirely made up? It's like a section of your, of the maxillide. Got it, got it, got, got, got it. Okay, so also, this is a pretty obvious one. Everyone knows this, but your kind of facial width-tide ratio.

Yes, the mid-face ratio, or just the overall facial ratio. Yeah, mid-face is kind of worse. Okay, it's like, do you have a long face or a wide face? Exactly, got it. You want to look at your nasal labial folds. Neasel-lis-loat. So this is on older people, right, you'll see these. kind of wrinkles. Oh yeah, yeah, yeah. So you want to be looking out. Minimizing those.

Generally, if you want to look younger, yeah. Okay, yeah, thanks a sense. You want to look at your bimaxillary protrusions? Bymachillary protrusions, okay. Yeah. So this one, actually, I'm not exactly sure what that one is, but. But it's got to be good. But you got to look out for it. You got to look out for it. For sure. Your nose bridge, right? You don't have to be too wide. This is something you can see. Yeah, yeah. And then your interpupillary distance, right? So this is IPD. And that feels like something you can do nothing about. So I actually...

A way to make your eyes wider or narrower? I think there are ways to do it. No way. Because it changes like how big your eyes look. Okay. I think actually... Also, potentially with makeup, you could maybe accentuate the IPD. I only know about IPD because of VR goggles.

Different VR goggles need different IPOs. Okay. I got to interrupt you guys to talk about the... The universe 25 experiment conducted by ethologist John B. Calhoun between 1968 and 1973. The experiment was the rodent utopia. Oh, yes. Calhoun built a paradise for mice where every physical need was met. They had unlimited food and water, so there was no competition for survival.

There was no predators. They were completely safe from external threats. They had climate control, so it was a perfect environment for living and reproducing. It was disease-free. The initial mice were chosen for their health. And so despite having space for 3,800 mice, the population peaked at 2,200, and then began a rapid, irreversible decline to extinction. There was a specific group called The Beautiful Ones.

It was a generation of males born during the peak of over-cruly. because the older dominant males had become hyper-aggressive. These are the boomers in our society. And the social hierarchy had collapsed. These younger males never learned normal social behavior. So I think we see this with like clavicular and people like that, like defending territory or courting mates. They were called the beautiful ones because their physical appearance,

of course, unlike the older alpha males who were covered in scars. Again, these are the boomers, right? They bought their homes for like 20 bucks. and maybe we're in the military, et cetera. The alphas were covered in scars and bitten tails from constant fighting. These males had perfect, healthy fur. You can see Tyler's hair.

He's got perfect healthy fur. Behavior, they withdrew completely from society. So again, you see these streamers. They're just like in their room, you know, smashing their face with hammers. They spent their entire lives doing only three things, eating, sleeping, and grooming themselves. Asexuality, they lost all insuffing. interest in mating or interacting with females.

Again, you see these with the looks maxing guys. They're not looks maxing seemingly for like women. They're looks maxing to try to mock other dudes, right? This is a plivicular talking about Gavin Newsom and magging, mocking J.D. And so anyways, something to think about with this whole trend. So the lessons become the beautiful ones. Like in that colony you want to be the beautiful one?

Absolutely. I think Tyler's on board. Absolutely not. You want to be the scarred alpha. Okay, the scarred alpha. You want your tail to be bitten. Yeah, well, I've always said I want to be whizened. I want to be old man maxing.

I want to look like Warren Buffett because I feel like there's a lot of people that are doing the younger thing, look maxing. There's Brian Johnson, obviously. But I feel like if I could become more austere, I would hold more, my words would hold more weight. And I feel like that's actually what's valuable. The wise one. So I want to look as old as possible.

I want to be leathery. I want to be wisery. I want to be leathery. I want to be leather. That's a great hair. I should dye my hair gray. I forgot about this one. They mentioned in the chat, but your cantal tilt.

So can'tal tilt is kind of the angle of your eyes, right? So you want, I think it's called Hunter Eyes. Hunter Eyes. Okay, yeah. All this for nothing. Yeah. All this for nothing. What a crazy time.

Well, we have our first guests of the show joining. I'm sure we'll continue the looks maxing conversation. While we bring him in, let me tell you about public.com. Investing for those to take it seriously. Stocks, options, bonds, crypto, treasure. treasuries and more with damn great customer service. We have Vincenzo Landino in the TVP and Ultridum. Welcome to the show. How are you doing?

There he is. Thanks for having me. I listen to this conversation. I'm like, do I have the wrinkles? You look fantastic. So you're one of the people that's actually been doing this. You've been look maxing for years, clearly. Oh, of course.

Yeah. I don't even know I was doing it, but okay. Yeah. I do agree with you, though, John. There is something about looking a little older so that people take you seriously. But you just graduated high school. You look about like 1920.

Is that correct? Yeah, actually I turned 21 yesterday. Congratulations. That's fantastic. That's fantastic. Yeah, you look very young. Anyway, for those who don't know, please introduce yourself.

We'd love to get the introduction for everyone. Yeah. Vachenzelandino, I run business of speed, so a podcast, newsletter, and a consultancy for brands that want to get into motorsport or businesses of speed, actually. So it's more than just motorsport. Sure. We call it businesses of speed. So mostly racing. That's a good business of speed. I like that.

How do you get into this? You know, it's to keep it short, I was a motorsport fan for a long time. And Formula One years and years ago, like when I started watching it back in the early 90s. Like right after Drive to Survive happened, you got into it? Right after Drive to Survive. Yeah, that's when you got into it. I'm sure. Yeah, I just jumped in right there. Yeah, yeah. Early, early to the sport, really. Yeah. Yeah. real early on, which actually is really funny because now people that came in maybe two years before the drive to survive, boom, are considered like old in watching motorsports. Yeah, unks, exactly. But now back, you know, like I said, 35-ish years ago, there was nobody watching it in the United

States. Sure. And being of Italian heritage and whatnot, I had a lot of motorsport fans in my family. And we used to watch it. We used to go karting. We used to go to racetracks all time. As I got older, I saw there was an opportunity that not many people are talking about the business side or at least the behind the scenes aspect of, in that case, in this case, Formula One. But everyone wanted to talk about how hot the drivers were.

You know, the engineering aspect was another, you know, element. Or even just handicapping who's going to win, like the actual, the actual results of the sport. The actual results. Yeah. As opposed to the business is behind. Yeah, that's everywhere. Exactly. exactly.

Amazing. What was the first piece of content? What was the first initial go-to-market with building content in the category? I don't even really. It was probably, it was Twitter for sure. And I would, I mean, I was just tweeting about different things, you know, deals that were coming through and whenever you could get any information about race fees or whatever, you know, a, uh, bridge track was paying for, to host an event.

You're like, okay, this is interesting. And you start building a following people thinking like, wow, that's ridiculous or wow, that's crazy. He didn't have no idea what went into it. And then just kind of snowballed into what it is now, which has become, I'm still building it, but really an opportunity for me to keep a tab

on the business behind it. Yeah. Can you give us a broad view into the health and state of motorsport, the business of motorsports in America? Because a lot of people in tech are just not that, not that into automotive. racing broadly. Maybe they watch F1 here and there. Maybe they go to an event, you know,

through first, you know, with some SaaS company that they're involved with. But maybe zoom out for a second and then I want to get into a bunch of the subcategories. I'll say anecdotally. Let's just, this is something I heard in Las Vegas just a couple months ago. Tech company in San Francisco, CEO, wanted, this is literally the conversation I heard, wants to get involved in Formula One somehow, knows nothing about motorsport, knows nothing about racing, just knew that it was somewhere where there was attention and he wanted to get his brand in front of it. And so hearing conversations like that happening and partnerships and commercial deals happening just because they think it's cool, again, from someone who's seen the trajectory over

decades, not just like a few years, that's fascinating to me. Still fascinating to me that that level of interest is there. But that's not the overall health. I mean, Formula One is definitely healthier than most. In the United States, you still have series like NASCAR that dominate, at least in viewership,

but there's issues there as well. Indy car, great racing, but still trying to work out who they want to be. And so there's there's the increase in popularity in F1 in America.

actually hurt indie car because it feels like some potential overlap or is it kind of a rising tide lifts all boats? I think it's actually, so I think it is, there is a level, an aspect of rising tide is raised all boats, but it's also hardened the diehards. Like they are the indie car diehards, I feel like have come out more now. Because they're like, we don't want to be run over taken over by this European thing, this Formula One, which is the actual conversations that happen. I mean, it's kind of funny, but, so Indycars has seen it, but what no one has been able to figure out that Formula One did was the content aspect. Drive to Survive was one of many, many things that they've done behind the scenes, right? ESPN didn't get enough credit for the growth. You know, everyone said, oh, Netflix Drive to Survive effect, all of that. I mean, including myself at one point, it was like, wow, this Netflix thing is really, this is what's causing all of this. But it wasn't. ESPN did put a lot into it. And so I would say that you have seen a lot of rising tide, but no one's figured out the content aspect. It's for whatever reason, it's like, not for whatever reason. I know that, you know, we know what the reasons are. Formula One is just the attractive. It's the flavor of the day, month, year right now, maybe the next couple years. But it's sexy, right? It's European. So if you want an audience, it's global. Let's not say it's not. just European. It's global. Yeah, it's a travel show in addition to being a race, in addition to being a reality TV show, in addition to being a dating show, it sort of scratches

every it so a household can sit down and everyone in the family is watching it. I always appreciated the business side, seeing how the owners were kind of processing. Yeah. Being in that, understanding that dynamic where you have this like desperation to win, you badly want to win. then every single decision that you're making throughout a season is like, okay, how much, like, technically, like, you know, how much do I want to, how badly do you want to win? How much do you want to actually spend? How much do you, like, how, how, how much are you willing to personally invest? So that happening at the owner level and the athlete level. Yeah. And at one point, it was, you know, it was whoever could just keep spending. Right now we have the, the salary, or the spend cap.

And the spend cap has created more competition. You can't spend over 140-ish million. It's going to go up a little bit more. But you can't spend over that amount of money. And so that's caused better competition. Everyone has to kind of get to a point. But at one point in Formula's history, it was just you spend, spend, spend. There were way more teams on the grid, way more drivers.

We actually had on our podcast, Mark Blundell, who was a driver from the late 80s, early 90s, he drove with Senna and some of the other greats. And he was saying, you know, it was like, we had to qualify to qualify. You don't have that now. You've got, now there's going to be 22 drivers on the grid. They all will start come Sunday. That didn't happen, you know, 25 years ago, 30 years ago. It was, you had to qualify just to get onto the grid.

And there was plenty, because there was so many cars that were just like, they would allow anybody that could come up with a car would be on the grid. grid and it couldn't compete. It wasn't reliable, whatever it was, or they'd be so slow. They obviously wouldn't put them on the grid to qualify. And so all of that has led to the popularity, but also the financial health of it. Look at the valuations. Yeah, I wanted to get your read on like team valuations because obviously the people

that were like just pure enthusiasts in it for the love of the game have benefited to some degree just based on the appreciation of the value of the teams. there's so much more attention. They can bring in a lot more sponsorship. We were at the Vegas event and just walking around and seeing how the different, yeah, felt like being at a tech conference. Every team has a major tech company on it.

Yeah, or multiple. Multiple. Yeah, multiple sometimes. Yeah, valuations. But yeah, valuations of teams. George over a crowd strike. We work with Crowdstrike. Saw, you know, he recently,

bought into Mercedes in a big way after being a partner for a while. But how do you, how do you think that, do you expect valuations to actually trade down at any point? Could we be at somewhat of a local top? I think at some point it has to max out, right? Like some of the valuations seem almost insane to me. Mercedes, just the team itself.

Six billion is what, it's right around McLaren. four and a half. Ferrari's a little bit different. They've got this a global brand. They're a little over six and a half billion. And even at the bottom of the grid, you're still looking at two billion. I remember Zach Brown, CEO of McLaren had said, and I actually had a conversation with him in Vegas, but he had said 2024, 2023, maybe it was. At one point, all of the teams will be valued at a billion dollars. And we all thought, that was like, no way. This is, like, are you kidding me?

And here we are not even a full two years later. And every team has a valuation of roughly, you know, $2 billion. Of course, there's private equity now investing. You've got some bigger players that want to put money into these teams. And so valuations are shoot up. I think it has to cap somewhere. I don't know where that cap is. I have said $10 billion.

I thought it was like, absolute max. But I think even that might be ridiculous. But, you know, I know that if I say that now, then in two years when... But the average net new investor, are they really going into this expecting a return? Or do they want to be an owner of a Formula One team? They want to be the owner of Formula One team. I mean, it's cool. You can't put a price on cool. You can't put a price on being into the suite. Like you said, it's a tech conference. It's who's who's who can I be seen around. Look at all the celebrities that show up. Look at all the major, you know, tech companies or all the player-led network.

It's a level of networking you can't really put a price on. And that's what you're buying into. You're buying into the opportunity to entertain your clients, entertain your friends, entertain other executives to be seen as, well, I'm the CEO or I'm the founder, whatever it is. I'm the boss. There's so many levels to it. You know, our friends at public, who we went to Vegas with are their, you know,

multi-year sponsor of Ashton Martin, but then the level beyond that is like, yeah, actually, you know, buying into the team and becoming it. Yeah, I noticed over the holiday, like, the global elite were in St. Bart's and they all pulled up their yachts. And when you read the articles of like whose yacht is there and who they are, it'll say the person's name. And then like probably half of these people, they're described as like owner of the, you know, pistons or over of, owner of those red socks.

of some sports team. And you always look them up and it's like, they didn't make their money starting that sports team. They started some boring oil and gas company or software company or something. But as soon as you own, it's like writing a book. As soon as you own a sports team, that's what you're known for forever. And like you're just the Dallas Mavericks guy.

So it goes back, you guys are talking about Steve Jobs earlier. We don't have, and how they're right now we don't have somebody that is like Steve Jobs for AI and to just like snap a finger, tell a story. It's the story, right? And I don't know if that's what you were looking to say at one point, but it's a story. It's an instant story. You go and sponsor Williams or you go in Atlassian. You go partner up with Williams. Now you're going to be part of their comeback because William,

Williams, the team is coming back and they are more financially healthy. They've got great investment now. Great team, great leaders in place. Well, Atlassian is going to be right behind, you know, they are right there. Built in story. People that didn't know them outside. of Australia, which, or maybe even like the U.S. whatever. They'll know. Globally. Instant global recognition, right? You can't buy that anywhere. You know, you can't buy that story,

that level of story. There's no price that you can put on that. And so I think that's what we're, you know, we see with Formula One specifically. What is the dynamic of, so Audi's joining the grid this year, how does that work? Is it is the number of teams going to

effectively be fixed forever? Like, part of the reasons why NBA and NFL teams are valuable is because you effectively have a monopoly, right? We're not creating more teams. So you don't have new competition and pricing pressure and things like that. How did that dynamic, how do you actually, they're taking over from another team, like break down that dynamic? And will we see more?

Could we see a future where there's 30 cars on the grid? So Sauber was the team that Audi bought to get into. So they took a spot, right? And so that, for the, I'm trying to think of how many years, but let's say at least the past decade, maybe 15 years, you've had a pretty fixed number of teams on the grid, 10. Cadillac is entering the grid as team 11, and that was a big, big deal.

In the charter from 2022, the dilution fee was 200 or 300 million, because no one thought, And that's a fee that goes to all the teams. That's a fee that goes to all the teams. But it split up. It's split up. Everybody gets like 10.

Yeah, 10 million. Which is nothing. Which is nothing. And that would have to be updated, I imagine. And it did. It got updated. And when this was, so the big issue that came up was when they were looking for Team 11,

Cadillac was came in. It was Andretti that was trying to put in their offer. Michael Andretti, Mario Andretti, his son Michael and a group was trying to buy in. There was politics behind the scenes that were going on. They had the money, they had all the things together,

ducks in a row. Some people don't like them, and so they got kind of pushed out. Now we have Cadillac to enter. But at the time, they came to the table with their $300 million dilution fee and they had facilities

and all the things that F1 wanted to see. Well, they quickly said, wait a minute, 300 million is not enough money. Like, wait, this is, this is crazy. The sport has completely ballooned in valuations and how much revenue. We need to do something different. So I think it ended up around 600 million.

So double, just to enter, just to say, now that's not to say that you're done at 600 million. You need to have facilities. You need to invest in people. So you're all in. That's the ticket price. Yeah. That's the price just to say, like, yeah, we'll entertain you. Yeah.

So 600 million now. So you're not going to have anybody just come in and say, I want a team because you need to have a few billion. So is there a hard cap at all in the charter? Obviously you could update the charter. The charter says 12 is the max right now. That's what the chat was saying too. How does, have the manufacturers,

how much do they try to track or how much do they worry about how on grid or on track performance impacts car sales? I had a Ferrari at one point. and, you know, any time I'm watching F1 and I see Ferrari with technical difficulties, I'm like, yeah, big surprise, because I had a lot of those things too, right? You think that would be disconnected, but I don't know, it's just like, just some sort of cognitive bias, but it really feels real. If we, if we, you know, have a team and we're, and we're just terrible. Hurt the brand. Who, yeah, why is somebody going to want to go and spend 400, 500, you know, or more on one of these cars?

yeah so i remember laurence stroll in 2020 what year are we in 26 so we're about three four years ago he made a comment that because ass and martin had the safety car they actually split safety car duties with mercedes but because they had one safety car he estimated about 80 million dollars just from having the safety car in sales um so i think it was the vantage and they had like the vantage f1 addition. He sold about 300 units, whatever, $200,000 a piece, whatever they were. And they sold out pretty instantly because it was a car on the grid. Mercedes has really pushed the AMG badge a lot over the past, I'd say, five to seven years. While destroying what made AMG great in the first place. And I had, you know, I had an AMG, loved it. It was great until I started seeing everybody with an AMG.

I'm like, well, AMG doesn't even mean anything anymore. It's just kind of like, it's the standard car. don't even, you don't see a regular Mercedes. Everyone's got an AMG at this point. But that was due large part. They're going to make a V4 AMG. One's two cylinder. So, no, no, I know. They are starting to, they got the message.

Was it the C-43? It was the one that people really didn't like. Yeah. I mean, for what? It was kind of pointless. I mean, I had, mine was an eight and it was the last eight, in 2019. And I, you know, people, it was very desirable to aftermarket folks because,

because of that. But yeah, even when I, when I think about Aston, if Aston can win a championship, I do think that that could be very beneficial for the brand in America. McLaren, McLaren, I'm sure they're going to benefit in some way. But Aston, I feel like really, like, I mean, that dynamic's interesting because you have kind of the same owners in both the Formula One team and the actual manufacturer, which are different entities. And so there's a real incentive to like, hey, let's actually win a championship. they make some of the most beautiful cars in the entire world, but they're just not as desirable as the Ferrari at the same price point.

Well, Ferrari is also, I mean, what Ferrari does to buy any Ferrari is just, it's like, it's the luxury playbook. You know, you can't buy the one you want until you buy 10 others, and then maybe we'll let you buy it. I mean, it's just the scarcity thing. But I'll say with Aston Martin and McLaren specifically, they're still, I would say they're buoyed by Mercedes doing well, because they're their AMG power plants.

So that makes a difference, especially to the level of enthusiasts or the collectors that are buying these cars, but they are beautiful and they're gorgeous. There is a direct correlation, and you will have conversations with folks within the teams that are absolutely tracking that kind of thing. It's, what is the lift?

I don't know the number for every car maker, but it's, you know, Red Bull doesn't make a car, right? So they've got nothing to worry about. Williams doesn't. What about the RB17? They made two of those. Well, all right, right, right, right. To be fair.

To be fair, yes, yes. But yes. I just meant like a regular car. That thing does look pretty. What about, what's happening in sim racing broadly? Like, how is the, I mean, do you look at sim racing as its own kind of sub-industry? Is there? I don't, I mean, so I don't track it as much, or I'm not paying as much attention.

I know that it is, there's a higher. interest in sim racing because most people realize, well, it's too expensive to go get a track day. It's too expensive to try and even go racing, right? To be to go from carding to you know, to the different series levels and then to get to F1. It's it's impossible right. And you need. Yeah, people were running the numbers on like how much Lando's dad had spent to get him at actually in the game and it was like they clocked it at like 40 million dollars over the career. Yeah. Yeah. Either you have a very rich. Yeah. Rich parent. or a sponsor, you know.

But I think you need both. You need both, right? Or you don't need both, but like it helps to have both. It's not just one or the other. It helps. I mean, it's a different lifestyle, right? So it's a lifestyle that is you're traveling. You're oftentimes, unless you're already in Europe,

you are likely going to Europe. We had Connor Daly on our podcast, IndyCar Driver, and actually that episode comes out a couple weeks. But he did say to us in the conversation that, you know, he had to go to Europe to race an open. because that's where it was like he couldn't do it here. There was no ladder. The ladder system wasn't robust enough to get where he wanted to go. That takes dollars, right? Now, his dad raced in Formula 1. But could I do it? Could you guys, I don't know, would we be able to start? Would my kids be

able to start? Yeah. It's, it's just, so that's where sim racing comes in. Sure. And sim racing is made more popular because the current batch of drivers are very tapped into the sim racing world. Sure. Max Verstappen races, racist sim cars in between races, between qualifying, and the actual race the next day. He's like, I'm going to go home and I'm going to go race on the Sims. And he takes part in competitive, you know, racing. Lando races, Charles, they all, they all race. And most of them are racing pretty competitively on Sims.

So that's also made it more popular. The allure of being able to maybe race with Max Verstapp in Orlando North or get, you know, boot up online and play that. That's all increased tremendously. I'd have to actually look at the numbers. I want to see if they're out. What about the, what about the, the health of individual tracks around the U.S.

we're going to, we're going to doing a track day out at Willow Springs later this month. And I think they changed ownership recently. Yeah. And, but, but yeah, how are these doing as businesses? Are they the kind of things where it's like fun to own, but actually just a terrible business or is anybody actually doing really well? It's a tough business. Is anyone doing really well?

It's the ones that are, you know, are backed by dollars. that have big races at them. It's hard to maintain. A pure enthusiast track, you're saying. A pure enthusiast track. Yeah, you really have to be like a CODA right now to be immensely successful. Now, that's smaller regional tracks

are still hosting, you know, plenty of racing, but to say they're extremely healthy is tough. Also, there's a lot of folks that think, oh, we want F1 to come race at our track, or we want F1 to come to Road America, F1 to come. It's like, no, you don't because it's a whole spectacle to come build this. And oftentimes it destroys what makes your track unique or appealing or, you know, charming. So there's a lot of, and those are conversations I'm always tracking. I have a kind of a not quite baked thesis,

but an idea that the track business might actually become a great business in the future if it becomes effectively illegal to drive cars on the road just via Thomas vehicles. guys and girls are not going to like suddenly if at some point it's like humans can no longer drive it's just too dangerous yeah like you can imagine that scenario happening in the next 10 20 years and people are still going to want to drive so they're going to take their cars to tracks and that you could see a resurgence of enthusiast driving because it just made illegal on normal roads yeah i mean that's actually i that's fantastic i didn't even think about the autonomous driving aspect of that and how if people can't drive people that like us that like you know have gotten a taste of driving we know what it's like

also driving on a track driving your car on the road versus the track is just it's complete it's incomparable yeah totally different totally different i mean you you know you wonder sometimes how people get their licenses but you're like i'm not going to drive i'm not going to drive the way i want to drive on a track on on you know the high i 95 over here like it's just not going to No, and then there was that tragedy recently. Oh, yeah. Was it the Activision? Founder of Call of Duty.

Founder of Call of Duty was driving. I've driven Angelus Crest a bunch. I had the scariest moment of my life in a car on Angeles Crest at around 6 a.m. probably five years ago driving a 997 that I had. And I, yeah, you can imagine at some point that, I mean, what a lot of people do at ACH is already effectively illegal. right? They're driving 30, 40, 50, 50 miles above the speed limit, telling each other very closely. It is like reckless driving.

But yeah, but yeah, that wouldn't, if that same situation had happened on a track, like everybody would have been fine. Yeah, for sure, usually. Walk me through a circuit conversation real quick. No, I just want to add one last thing to that. There's a lot of the, you know, private members only. clubs coming up now at race tracks for enthusiasts. I think that's an opportunity for race tracks to become maybe a little more popular or increase their health because they can offer. And Cota's doing it, right?

They're offering luxury condos and garages and a whole club membership or a membership. So I think that's something that can happen more. Can you take me through what a successful F1 track build looks like? How is Vegas looking? They were very much bragging that it was a part. permanent facility. It's remarkable. It feels like it's working. But how does this actually work? Who's paying who? And how is it penciled down in Vegas? I mean, you've got, you've got some public money, public funds needed. And of course, there's plenty of complainers about that nonstop. Just open up,

open up Twitter and you'll see people complainant, locals complaining. The permanent facility in Vegas is actually a new thing. So there's really not much to compare it to because street tracks don't usually have anything permanent. You go to Monaco, they're putting that together months ahead of time. So that for Vegas is pretty unique. They are filling it with the Grand Prix Plaza while it's not race. I think they cut off around September, October. And so then it becomes a business with the Grand Prix Plaza.

They have the F1 experience. It's kind of almost like a museum. There's simulators. There's a restaurant. So they're trying to keep people tied to the F1 brand all year long. That's unique to Vegas. In terms of the layout of the track and whatnot, I mean, the build of the track, the permanent pieces of it, I believe they are trying to add some permanent, like, lighting

fixture so that those don't have to go up every single time. But, I mean, you guys were there. So you saw, I mean, there's so much of it that has to go up in real time because you can't close down the strip all year round. you can't have, what is it, you know, you can't have all the things they have up around the track, the stands, there's not even really stands. Everything's like luxury over there. So it's, you're either in a suite or you're not. So yeah, all of that has to go out in real time. You know, when you have a permanent facility, like a CODA or, or Miami's kind of half and half,

but when you have a permanent facility of CODA, you know, it's obviously there, those are more expensive to maintain overall because you have to keep them occupied and you have to do something in them year round after that one race. Vegas, you know, you kind of take the good and the bad. You have to take the locals complaining and you have to do the shutdowns and all that. So I mean, you guys were there. So you remember how like they had a shutdown from like Wednesday at two o'clock. Basically from two to midnight every day after that was closed down. I mean, those are things they have to deal with. And I think that's just unique. Las Vegas is really. really unique. It's also new to Las Vegas residents, whereas you take like a Monaco that's been

around since the 20s, those folks are, they're used to it. It's part of the identity. And that's, that's where I think there's still room to grow. I mean, the difference in Monaco, too, is like if you're a resident and you own or rent like a condo or an apartment and then F1 comes to town, it's super exciting. But if you're a Vegas resident and this track springs up and everything gets more expensive and you're kind of like boxed out. It's not as much of it's and you're not necessarily an F1 fan. It just becomes much more of an annoyance than like a celebration of the city. And I think that's where the like we still haven't gotten peak saturation, right? It's not people aren't excited about it just because like it's not ingrained in their identity. Whereas you go to,

you know, you go to Europe and they are have more of a motorsport culture or at least F1, let's just say F1 where that culture is understood. So track, Tracks are very interesting. They want more street circuits. There are more street circuits coming. Madrid is being added this year. So that'll be interesting to see how that build goes. We actually talk to the... Why do they want more street circuits? I feel like an American Nürbergring would be incredible. I would love an American Nürbergris. Maybe in like Idaho or something, going through the forest. I don't disagree with you. The reason they want more is because it is actually more appealing and more sexy to say, hey, come to our city.

come to Madrid, and we can sell Madrid. So being able to pay. I mean, Vegas, everyone goes to the nightclubs. There's like a huge economic impact, the hotels. Whereas if you're out in the sticks, yeah, you might be in some cheap hotel, but you're not going to go spend a ton of money. Spa in Belgium is arguably every driver we've talked to, every, any motorsport enthusiast says spa is the best track to drive, to race at.

It's awesome. But you know where spa is? In the middle of the Ardennes Forest. Yeah. It's awesome. It's not, right. It's cool if you're really into motorsport. But if you're trying to sell F1 or you're trying to sell the brand as this is appealing to sponsors and it's sexy.

And well, I don't, I would rather do it in, I don't know, Brussels or something. Yeah, yeah, it is. Because you're basically holding a, you're holding a conference for your company. A lot of business sponsors will invite key clients and partners to come with them. And if you're out in the forest, it's a little different. And the playbook has been written. So, like, it's become a festival. It's, you know, it is a festival.

And that's what they want the new, like, if you're going to pay $70 million to host a race, you need to recoup that. You can't recoup that by just having a race in the middle of nowhere. And that's why you're seeing a lot of these things happen with the smaller tracks in Europe. They can't afford it. They just don't have it. That's funny. I, next time you come on, I want to talk about the possibility of an AI driver at some point.

I think I have a lot. Imagine if Google bought a team and they had no human driver. This is my new AGI test is I want a humanoid robot in a manual gearbox shifting with three pedals around the Nureberg ring in under seven minutes. Now, did you guys see the Abu Dhabi Autonomous Racing League? I saw it like briefly, but tell me. It's autonomous racing. It's teams of engineers basically with no drivers in the car.

Yeah. It's clunky. It's clunky. It's like, you know, because the cars, I mean, they are driving by themselves, but they still have to process. So like, you have a car cut in front of you. Yeah, what do you do about that? Imagine, well, imagine a Waymo and something jumps in front of it. It's going to stop, right?

So it's kind of like the same thing happens with this race. So it's kind of, if you had a chance to look at up, the autonomous racing league, and it was in Abu Dhabi, they're trying to make it a thing. Yeah. I don't know about it. It's not there yet. I would love to see some, the track times, how they compare, and also all. of the blooper reel, I'm sure, is really funny.

There's a lot of blooper reels, for sure. Anyway, we'd love to have you back on. So great to hang. Let's make it a regular thing. This is great. And appreciate you giving us a full overview of everything. Thanks for having you, guys. We'll talk to you soon.

Goodbye. Let me tell you about Vanta. Automate Compliance and Security. Vanta is the leading AI trust management platform. You can go check them out. And our next guest, Nigel Vaz, is already in the Restream Waiting Room. Let's bring him into the TVP and Ultradome.

Nigel, good to meet you. How are you doing? How's your new year going? Off to a good start. Thanks for having. Great to be on. Yeah, it's great. Thanks so much.

Well, we'd love to kick this off since this is the first time on the show with a little bit of an introduction on yourself and how you introduce yourself to everyone who's watching. Yeah, I run Sapient, which is an enterprise AI software and technology business. Sapien was founded about 30 years ago

in the early days of the internet. internet, building some of the world's first online banks, the first time you could trade equities, the first time you could pick a seat on an airplane. So we've had about 30 years of building digital systems to really build intelligent enterprises in the first wave of digital and now leveraging AI. We're all about how we can actually unlock real transformation beyond pilots for some of the largest enterprises in the world. So what we really do is bring together deep industry expertise across sectors from financial services, retail, healthcare, and then combine it with our digital DNA alongside a few AI products that stem from agentic orchestration through to accelerated software

development, and then finally managing IT systems using AI. How did you process that data point that kind of shook the internet a little bit for a couple days last year where it suggested that a lot of the AI demos at the enterprise level, the experimentation, those experimental budgets, that they weren't getting renewed, that they weren't seeing the level of adoption. They weren't getting renewed. It's just that they weren't like. They weren't converting and they weren't working.

It was some crazy high number, like 93% of enterprise. Yeah, 95%. Yeah. Yeah. So how do you process that at the time? Yeah, it was an MIT study that came out. And actually, what we did is we had a bunch of professors at vans. evaluate from MIT our work almost as a counterpoint to that data.

Because what we were seeing is, of course, there was a ton of experimentation in the organizations around AI. But trying something out and then scaling it across the enterprise was one of the biggest stumbling blocks, largely because building a proof of concept in a small organization and scaling it is a lot easier than when you are one of the largest automotive manufacturers in the world or when you're one of the largest banks in the world. because you have to actually think about the tool chaining of the organization and how these systems deploy in the context of that. Most of these organizations, I mean, Davos is coming up in a couple of weeks.

And every time I go over the last couple of years, AI has been the dominant conversation. But more and more clients are now saying, hey, we understand the concepts around AI. We understand all of the conversation is around compute and all of the conversation is around models. But how am I, as an enterprise leader, getting value from this in the context of what I do day to date? And that is exactly why that stat is so critical. Because I think essentially the bridge from you experiment with a little bit of AI to you can actually start to see meaningful gains outside of the obvious use cases of you're deploying AI in the call center to route some calls more efficiently or you're deploying AI in the context. of enabling your sales teams to be more efficient, right? We're talking about large-scale, agentic mesh deployments

that are allowing businesses to reimagine a car build that used to take 18 months in 18 weeks. Yeah. Or allowing an insurance company to monitor worldwide events and on a dynamic basis allow you to react to the fact that I heard one of you guys talking about your house getting burned down in California. And this is an actual piece of work we did.

for a client where they were monitoring the air quality postfires and alerting people who have significant issues with asthma to actually, you know, make sure they had inhalers or maybe even perhaps moved out of those zones proactively, saving themselves hundreds of millions of dollars in health care and better outcomes for these folks who otherwise might have gone through a traumatic health event, right? There's a white felt. That's the white felt. Require completely different orchestration than I think a pilot or two.

Could you share some more as much as you can, like who your actual like clients are? Because I think that would be helpful to ground the conversation because it's some of the biggest companies in the world. Yeah, it is. It's some of the biggest banks in the world going all the way from retail banks to investment banks, like the likes of a Goldman Sachs, for example, in the investment space. In the retail space, we work across the retail space across essentially grocery retail

and then fashion retail as well as general product retail. So we work with the likes of a car four in France or a Walmart in the U.S., Tesco in the UK. So a number of big businesses there in the context of the automotive space. the likes of a number of the big German automotive companies, a number of the big U.S. automotive companies,

Asian automotive companies. So we serve multiple sectors across countries around the world. And in many cases, that's one of the complexities there, right? Because these are global organizations. There's different data governance rules. There's different legacy enterprise journeys that they've gone through. Almost every one of these enterprises is sitting on a few hundred million dollars of tech debt, which you have to kind of work your way through before you can actually

deploy any one of these AI, you know, ideas. How are some of these like management teams that you work with approaching messaging AI internally? Because I feel like the broad fear in the economy right now is related to job loss. And so one of the reasons you'd bring in an external partner is so that they can take just kind of a pragmatic view at the business and really understand where you can get leverage out of AI, whereas if you're running a thousand-person organization in a company, there's maybe some more attention around implementing AI. You know you'll probably lose your job as an executive if you don't implement AI well, but depending on how you implement it, there's going to be some job

loss and people are looking out for their team and maybe they like having a bigger headcount, etc. So how, yeah, how is that even being messaged at the moment? Look, I think the conversation is definitely across organizations, right? I mean, people in most enterprises are very tuned to the fact that this is a moment, much like the internet was, and we saw this in the earlier use of the internet. I mentioned some of the things we did back then, right? A moment of reimagination of business in a very fundamental way. This is not one of those incremental, you know, progressive overload type moments. This is a significant transformation. So I don't think anybody in a organization sitting there basically saying, hey, I think

nothing in my world is going to change. I think people expect the change. I think what most folks aren't clear about is what is the journey from here where we have existing systems, existing processes, existing ways of working that the business is running on and, you know, making sure that you can fundamentally rebuild this plane while you still have targets and commitments and shareholders. And you recognize that if you don't do it soon enough to the point you're making, you're going to start to give up margin or you're going to start to give up speed or you're going to start to give up market share. Almost every conversation we're in is about how can I actually drive more growth. How can I actually create a better experience for my customers?

And this isn't coming just from leaders in the organization. This is coming from people across the organization. What we are seeing, though, is that at the level of enabling these people to do work in this new context, organizations are very much separated by execution. So, you know, so many clients will talk about, you know, an AI strategy, right? But do you have a data strategy? Are all your data sets connected? Or actually, are you doing AI pilots on sales data on this ERP system over here and doing, you know, marketing pilots on that ERP system over there? which will eventually evolve to agents on this ERP system for sales, not talking to agents

to that ERP system on marketing. And those agents not talking to each other across sales and marketing resembles a traditional baton passing organization of today. So you're mimicking a lot of what you do. Larger enterprises, how it felt like last year was the year of was all about just like coding, right? Every single founder that came on our show would talk about the leverage that they're getting. We're getting that leverage internally. We've built a bunch of software to run the show that we never would have built historically because it just would have been too time intensive,

but now we can have one great engineer, Tyler, on our team, who can build an entire product end to end. Please don't try to poach him. But yeah, how is, how of, like, how of coding agents, and products been adopted in some of these companies. Is there any type of restrictions? Part of the reason that it got adopted so quickly is it was somewhat permissionless. Engineers could just sign up for product and go bottoms up. But I don't even know how adoption would work at someone like a McDonald's or

someone like a Mercedes or someone at a bigger bank where I don't know that an engineer can necessarily just say, like, I'm going to start using this product. No, and you can't, right? you can't because the fact of the matter is it's not just Tyler or one engineer. It's one engineer with another engineer, with a third engineer, with a fourth engineer, where a lot of them share context around a bigger application, whereas if you start using one tool chain and the next person starts using a next tool chain, which is, by the way, what happened in the early days, right, which is why you got those pilots up and running really fast and people were starting to see real leverage.

But then very quickly, that started devolved to basically, but we're not seeing the net output actually move the needle across big things. So I'll give you an example of a, you know, we did a piece of work for a large healthcare company, which was on a 10-year modernization journey, migrating millions of modernization. Wow, thinking in decades. Thinking in decades. People say you should think of decades. These people are actually doing it. I love it. Yeah.

Yeah. And it's crazy, right? It's like millions of lines of cobalt. code written in the 60s and 70s by dudes that are not only in the company, they're not probably on the planet, right? And you have individual developers going line by line by line, trying to interpret what the intent behind the code was. But more importantly, because this is HIPAA-compliant data and has serious healthcare outcomes tied to it, you have to be really thoughtful about what of this code you need to retain, what logic it holds, and how much of this you can actually, you know,

do away with, right? That journey, going from like a 10 years to a few years, two years, or three years requires you to be able to have all of the current business context of the organization. It requires you to have a future state that you understand really well. And you need to have a group of people working on a very similar tool chain so that the code that you are ingesting then gets created into a spec that a bunch of humans can look at and say, is this the spec that we actually want, and then that spec can actually get migrated into new code. So we built this platform called Slingshot, which is our software modernization platform, and how it differs from a lot of the consumer-grade platforms that have got crazy valuations

right now is they were all built for individual users writing apps like Tyler for small organizations or for themselves. But the minute you start to deploy them into large enterprises, what you find is that enterprise context graph that is missing or permissions. Like, what part of the app are you allowed to see versus me? Or what is my relationship to you on a dev team, right? How do you actually start to manage authentication, permissions? This is the kind of stuff that really makes those pilots go awry in the context of these big scale changes.

What can we expect in AI in advertising this year specifically? I feel like we went from large companies making an ad and saying we're going to, to serve this to a million people or 10 million people or 100 million people, right? A Super Bowl ad is an example of that. And then as you have platforms like meta, really, really, really specific targeting, you can basically make an ad and serve it to like a tiny group of people, very, very specific. You can imagine a world in the future where an advertiser, even as big as McDonald's, would effectively make an advertisement that's meant for like one individual person just because

you could generate it on the fly. Jordy, you're going to love this. Yeah. this big Mac is mean for you. Yeah, effectively. So what are you expecting on that front? Because the models have gotten a lot better, and it does feel like companies should generate

maybe at least 50 times as much ad creative this year than last year. I think the outputs going up. The question is whether the quality and the targeting are going up simultaneously, right? Because meta sees incredible stuff in their wall garden. Google sees incredible stuff in their wall garden. But how are companies leveraging their first, party data to understand that you're Geordie, this is your context, this is the car you drive,

or this is the burger you eat, or this is the hotel room you like to stay. I tell them everything about myself. I want them to target me as specifically as they possibly can. You'll be so surprised, though, right? I'm sure you do that all the time, but how often do people actually use what you give them about yourself to actually give you something back that's relevant? The heart part is not getting consumers to give data. There's been a lot of conversation. about data privacy. And of course, I think consumers are all about like, if you give me value back, I'm going to give you my data because I get something back in return. So if I'm watching Netflix and you know what I like to watch, you're going to show me something back that I care about.

Great, I'll give you my data. But most companies can't do that. They can't actually sur up what you want. I mean, you know, we work with a very large hotel brand, Marriott, globally. And we were basically working with them to basically say, how do we capture intent in the context of what people are searching for. So when you actually go to their villas platform, you know, historically what you might say is, hey, or a hotel platform, you might say, these are the dates I've got free, this is the city that I'm searching for, and this is the kind of product that I'm looking for, right? And now you flip that around to say, how can you ingest all of the intent and context that they're willing to give you? So give them a white box. And all of a sudden you say, hey, I'm a,

I've got young kids, I've got a pet. One of my children is autistic and really sensitive to noise, so it needs to be in a quiet part of the hotel, blah, blah, blah. Next thing you know, the relevance that you can respond with goes up dramatically. So what I think you're going to see from an advertising perspective is people who have the ability to leverage first party data, combine it with second and third party data from a targeting perspective, and then building production tool chains that allow them to use that to really personalized content is really powerful. Like to give you an example, large pharmaceutical company doing a vaccine launch in 115 countries,

how this works normally is the marketeers would have to come up with a bunch of concepts, then talk to the lawyers to basically say, what are the regs in each of these 115 countries about vaccines? And you'll find crazy stuff like in New Zealand. You're not allowed to smile in the ad because a smile implies an outcome. So they want like straight-faced people because you don't actually know if the vaccine is actually going to work. It's so hard to advertise if people can't smile. Yeah. Just like, if you take this, Jack, you're going to have a bad time.

So you've got this crazy process that goes for like 12 months where the marketeers and the lawyers are having a conversation about what can and can't be done content-wise. And then the content gets tweaked and produced, right? And what we built using Bo the Argentic platform, we ingest all of the regs into our platform. we then basically look at the creative concepts that were originally created by the team, and we'll test them against the regs almost on a real-time basis, and then regenerate, to your point, using whatever models are more efficient for the kind of content, regenerate versions of that content appropriate to every one of these countries,

and then allow that work to be deployed at significant scale. More importantly, if we discover an issue once it's actually live in the context of that, are monitoring agents are monitoring the content to ensure the reactions to them and then can actually start to do A-B testing about what's actually working better. But all of this is in one synchronous orchestration in the same way that these orchestrations might connect supply chain data to store inventory to advertising. So, or basically, you know, Black Friday, this product's already gone off the shelf. The ad isn't still hitting the same product because those people in the store are only going to

get more frustrated. And you start to close the loop. Awesome. Thank you so much for taking the time. Coming on, breaking it down. What an exciting time to be in this particular business. To be modernizing. I mean, nobody likes modernized. A decade will happen in years. I love it. Nobody likes advertising or modernizing more than us and maybe you. So it's great to hang. We'll talk to you, Citiate care. Great to hang. Before we bring in our next guest, let me tell you about restream. One live stream, 30 plus destinations. If you want to multi-stream, go to Restream.com. And up next, it's steward time.

It's steward time. We're stewarding. We are joined by Sequoia Capitals. Pat Grady and Robbie Gupta. What's going on, guys doing? Great to see you. Good to see you guys. Happy new year.

We might give you guys to scoot back a little bit. Is that possible? We're just like, we don't want half of you, Robbie. We want the whole. There we go. There we go. Yeah, let's go. Massive start to the new year.

Take us through the news today. Very exciting. But we'll hear from you. The news day is what? XAI is raising money. Is that the news that we're done? Yes. That was yesterday, actually.

Oh, okay. We've moved on. We already covered that. We're here to talk about you. You guys are looking fantastic today, just letting you guys know, particularly good, I think. Dude, so what happened today was, as you recall from my last TVPN appearance, I want my children to be AI researchers so they can support. the family and it wasn't obvious they were going to get higher anywhere else so we're like fuck it let's I'm going to start my own company right because it's epitism for the good to get the fact

um those are the links that I will go to to you know make my children happy no what happened was today I announced that I am going to be starting a new company I'm super pumped and then also um getting to do it while still being part of Sequoia is pretty special and I think uh my my brother Pat here, you know, was cool about letting that happen and we're excited. Yeah. How did you two first meet? Was it? Was it Abramson?

Yeah, of course. I think we had a partner named Michael Abramson who was involved with Instacard back in the day. And I think Michael was the original connection. And then Ravi, we got to know Ravi over a period of years. And I mentioned in a tweet today that we always have this shadow list, which is not long. It's like literally half a dozen people, but, you know, the shadow list of the people we would hire if we ever got a chance. Ravi was on that list for a few years, and finally you're lucky enough to get them back in 2019. Whenever someone asked me about my Sequoia interview process, John and Jordy, I say it was either five years or five minutes.

I don't know. It seemed to happen quick at the end, but, you know, I guess it took a long time. Being gag-stocked by the Sequoia partnership. I would love to see that list, but it's certainly key intellectual property. is, yeah, key IP. Steward, one of the things that you steward. That's a steward's greatest responsibility. How are you settling into the new role?

It's been great. You know, we, first of all, Alfred and I have been working together for 15 years. And he's been. How did you two meet? He doesn't big on this question, huh? I don't think we were going to answer it the first time. I thought they were best. We could do news, but I also like lore.

Well, I think the, I think most people know, Alfred before Sequoia was the president, CEO of Zappos, which was its employee investment. And so we got to know each other a little bit through that, but I wasn't playing on the investment. So it was just kind of being each other at Sequoia events or whatever. And then he joined, I want to say 2010, he joined Sequoia somewhere around that time. And at that point, I was mostly focused on growth investing.

He was mostly focused on early investing. By 2015 or so, he was co-captoning the early business. I was co-captaining the growth business. And we just had a great partnership for a very long time. Yeah. How are you thinking about the divide of responsibilities now? Is there more nuance to it than just early and growth? Are there other –

Is there someone who likes to do more personnel management, more recruiting or more marketing or whatever – more fundraising? Is there any division there? Once upon a time, Fred Lutty, who is the founder of service now, handed over the reins to Frank Slubman. And I remember shortly thereafter Frank Slubman had the line. I'm the workhorse. He's the show pony.

So Alfred and I have this wonderful relationship where the plan that we've agreed to, certainly agreed to, is I get to go on TVPN. He gets to manage to go in compliance. Alfred's welcome anytime too. It's fantastic.

No, no, I'm kidding. I'm kidding. The honest answer is our team, we have so many we have so many awesome people at Clay, not just on the investment team, but on all the operating teams, there isn't a lot of management that needs to happen. And so over the last couple of months, I think one of the things we've realized

is it's a very small amount of incremental load to do the steward job. It's mostly just serving as a thought partner for other people in the organization who kind of already know what the right answer is. And so there's not, there hasn't actually been that much incremental work, which has been a nice surprise. What is unique about Sequoia's surface area of work to be done? I mean, I know there's the RIA transition. Is there a public markets desk? Are there traders now?

Like, how big is the organization outside of what people think of from like a classic VC partnership? What else is going on at Sequoia? Why do you do that one? Yeah, I mean, you know what's funny, guys? I think people would be surprised at how small Sequoia is, you know, like the, I mean, I think we barely have double-digit general. partners in the business, right? The entire firm is pretty small. And so I would tell you this, and I mean this sincerely, like, I think people tend to overestimate like surface area, right,

of what we have in terms of like management scope. And realistically, the most important thing is that the stewards are awesome investors and people that great people want to work with, you know. And so the thing, I didn't say that's what you guys were. I said that's like an important thing for you guys. That's the idea. That's like the standard. Now we'll talk about it. That's what supposed to be. No, but obviously, like, so truly, like, I would tell you the thing that's most important for these guys is to be great investors. Yeah. It is to sponsor investments in the best companies and to continue that because, like, Sequoia's entire thing needs to be that we back the best companies in the world, right? And if we keep doing that, everything else kind of follows.

If we don't, you're going to be the best manager ever. Yeah, it's like, it's like a GP or a steward that's not investing as like a CEO with bad product sense. It's like, can they, can they really be a truly, incredible CEO if they don't understand the product. Yeah, you lose your moral authority, and we're too small of an organization. There's no management job available at Sequoia. There's just too small an organization. Ravi, how are you thinking about the specific advantages of starting a company from your experience at Sequoia?

There's obviously going to be endless industry plant allegations that you'll have to beat, but I'm sure you'll take those on head first. Well, I guess one question would be like... How much of the company do you build beforehand? How do you actually think about how you want to build this company? What are the axioms that you're following? Yeah, yeah, yeah. Go ahead.

Jordy, were you going to say something? Well, yeah, and I was going to say, like, what qualifies as an opportunity that is worthy of leaving an institution? Because a lot of the ideas that you think are good, somebody will come to you and be like, I'm going to do it. And you're like, that's great. I just read you the check. And then, you know, you go do the hard work. But this is different. Well, and the pressure is immense.

Like, you basically have to put on an absolute math. class here. There's no excuses, right? You have to, you have to achieve greatness. You don't think I can just yell at myself to grow faster and burn less. That's not how this is going to work. One of my favorite portfolio reviews is Ravi was unfurling this beautiful monologue about what was going on at some company. It was probably five minutes speech. It sounded great. And then when you boil it all down, he basically said grow faster, burn less. Just five minutes. It's a nice word. This thing happens at the ear. Okay. So, okay, so the real answer, I guess the first thing is, Jordy, like, you know this.

I'm not leaving. I'm changing my role, right? I'm going to go from like a general partner to partner on the boards, all that. But look, it is a high standard. This job is amazing. I love this job. I love our team. And I love the founders I get to work with.

I think the real thing that pulls it towards is not the specific idea. It's the specific moment we're in. I do think that AI is changing everything. I think that, like, I wrote this thing. maybe like a year ago AI or die, which was just sort of like, can you see the progress that's happening? And I really believe the world belongs to the fast moving, reactive, responsive company right now that can get the best people in the world.

And it doesn't matter if they're an incumbent or they're a startup. But I think that you like being able to move quickly and respond to that is the biggest advantage that you can have. And I found myself thinking about that all the time. And after writing that, I was like telling all these companies I work with and even companies I don't work with, like, look, this is what I think it's about. This is what I think we've got to be doing. And then I was like, man, I like really do feel passionate about this.

I want to do that myself. And so the real thing that happened was I just wanted to be on the field again. I wanted to build a team. I wanted to go after this. And I think the thing that I found was that the fact that I could then do it while still maintaining my relationships with my partners, the fact that I can stay on some boards, that made it so much more like something more I wanted to do. And then the other thing is, and I haven't shared this yet, and I'll share it with you guys one of the time is right.

But like, I have a co-founder who's out of this world, truly out of this world, like, way better than me. Someone that will make you guys bang the gong when you guys hear who it is. Are you going to be the show pony or the workforce? I mean, I think it's pretty obvious that I'm not the good books of the operation. I mean, I'm surprised that you'd ask. You know, but put it this way. Like when I told the kids, like maybe what do you think of dad starting a company, they were somewhat like, well, I don't know. like, you know, what do you think the implications are?

Do we have to move if this doesn't work? Do they call you Unck? Dude. Basically, okay? And then I was like, how would you feel if this person was the co-founder? And then my kids were like, well, we actually have $750 of accumulated birthday money. Maybe we could lead me today. Let's go.

Get him on the Sequoia list for future hires. They did not call me Unk, but Andrew's tweet was an all-timer today. All-time. So good. How are you thinking? about timelines with the new company. It feels like you can build products so much faster today than maybe you could two years ago that there's maybe more of a value in staying really, really quiet, actually staying in stealth and making some more progress before you come out the gates

and then invite a bunch of people to try to come compete with you. Yeah, I think, listen, we're going to talk when we have something to say, right? We got to go and build this thing. I do think, to your point, you know, the Sierra guys are very good about this and they have this language of like in AI world, a year is a month, right? Or, you know, whatever, whichever way it makes it faster. But basically, like a month is a year, you know, a week is a month and a day is a week. And the idea is that like you got to go fast. You need to be super responsive. You guys know I'm big dude basketball guy.

Coach Kay has this great quote. You know, I'm not a world class predictor, but I am a world class reactor. Like, that's what we got to be in. You got to be fast and truth seeking. And I think the other thing that's nice about being, you know, with Sequoia is like we get to see the best companies in the world, you know, and we get to learn from them and see the face that the best ones go. And, you know, Pat, you can talk about that. But I think that's something that is helpful. Yeah.

How do you think about the particular AI opportunity right now? I feel like there's there's a little bit of a meme that the best time to start a AI company is probably 10 years ago as a lab and weighed around and then have this. breakout moment. And the second best time is probably like the day chat GPT launched and everyone sort of realized that this was real. But we're now two years into this. A lot of, you know, the default categories, the market maps exist. How do you think about just finding opportunity? Is it unlocked by just last year's advances? Or do you think there's new categories that were not on the table two years ago that are now on the table? And I mean, this is your thinking, but also for anyone that's watching, who might want to start a company in 2020.

I kind of think that the premise that those other people have is flawed, right? And I'll tell you for real, like the biggest thing that makes a difference in whether a company succeeds or not is the people that are building it. Right. And I believe that we have the most fierce competition ever, you know, right now, and it's only going to get more fierce. Right. And I think that you're going to be fighting every day and there's no like, actually Sarah, whoa, that's wife wrote this awesome post yesterday about like, relevant. decay, right, and how much more quickly it's happening. And basically, like, you have to fight for your relevance every day in the venture world. That is even more true at the company. Like, it doesn't

matter what you did yesterday. Think about recently the goodness that's happened from Google, right? The best thing that happened to them is the competition that they have from Open AI, because all of a sudden it lit them up, and then they had to go and re-win all this stuff and re-get that mojo back. So even, like, the deepest moats in the world, you've got to go fight. for them every day. So the real answer, you know, John, is it all we want to do is be in a space that we are willing to fight for every day and apply the latest technology every day and have AI native people working on it every day so that every day we get, we fight again and earn our spot. And I, in my heart, I believe that more than anything, which is that like there's nothing

to protect right now. Even at Sequoia, there's nothing to protect. The only thing is what we go do tomorrow and that'll be true with the company too. So I think that like honestly, I, think when people are like, oh, the best time was before, I think that's like low agency thinking. And I'm like, I don't have any time for that. Like, you got to go out and get it. Yeah. I can make a specific case for why now is the time too. Please. So the, I think if you want to start a foundation model lab, yeah, you're probably better off to have already done that. You know, we've kind of already seen that play out. Yeah. One of our core hypotheses in the world of AI is that the value is at the application layer. I think even for the foundation model labs, we're

starting to see that that's true. I would argue that now might actually be the single best. time to start an application layer company, not because everything is white space, but because it feels like the playbook is finally starting to emerge. And specifically, if you think about like the three major inflection points that we've seen in the world of AI, I think the first was November 2022 when chat GPT came out and the world was exposed to pre-training. I think the second was fall of 2024 when 01 came out and the world was exposed to reasoning. I think the next one was actually the last couple of weeks where you see Cloud Code with Opus 4-5, and all of a sudden

we see what Long Horizon agents can do. And it's hard to, like, we're venture capitalists, we're not in a position to try to define AGI, but from a functional standpoint, if you have a piece of technology that can just like keep going and overcome obstacles and use resources and eventually think its way to the outcome that you wanted,

I don't know, man, that seems pretty close to AGI for me. And I think if you have, We have goalposts, physical goalposts here that will continuously move. Yeah, exactly. And so anyway, I think now that that playbook has kind of not quite been written, but you can kind of see it. You know, I think the ability for these application layer companies to go from a chat bot that in best case scenario, people use four or five times a day to an agent that is always on running six instances in parallel 24-7 doing the work of six human beings. like there's just a dramatically different impact that application layer companies can have

today using the most recent playbook versus what they could have done two or three years ago. So I think for that reason, it's a great time to start a company. Can I have one more? Sure quick. Is that right? Yeah. Dude, I think that I so agree with that.

I think also, if you just kind of think about this, I could give like a 10x engineer that has become so popular in Silicon Valley. I think Steve Jobs talked about it, whatever. I think that the leverage available to great people is it's never been higher. And it's only going to get higher, right? All these things you guys see about the value of agency.

And it's all about like how much do you want to get your idea into the world? I think that I don't know how to do the math perfectly of like, is it a hundred times person or a thousand times person. But I think that the leverage available to the best people is insane. That's a huge aspect of the new thing that I want to build to. And I want to build with our co-founder because this idea that I believe in of like people are power laws, right? people follow power laws. I think that's true and it's only going to get more defined. And so what Pat's saying about like, you know, the leverage you can give to somebody with today's technology has never, ever, ever been higher. Do you guys have any type of internal philosophy around? It feels harder than ever to predict like two years out. Like I think in 2020, you had a good sense of like what the world and what software was going to look like in 2022. And it feels much harder to do that today. Do you guys have any internal philosophy, you know, similar to Bezos, thinking around people are going to want things like cheaper and faster, and I'm just going to focus on that. The world's going to change, but people will still want things that are cheaper and faster.

Do you guys apply any thinking like that around when you're looking at investments, Pat, maybe at the late stage or Ravi with your new company around like, okay, a lot of things are going to change. Potentially, you know, we can imagine a century of progress in, you know, 20 years or 10 years or eventually. Yeah, two hours. Who knows? So how do you build something that's going to be durable and, and again, like, relevant as you get increased rate of change? What's your thing on inevitable? Yeah, yeah. I think you, I think there's a few things. So yes, I think, and I think Pat and I agree on a bunch of this, too, but I think one, you want things that are early and inevitable, right? Like, I think that there are things that when you see them, they're like, well, that definitely is going to happen. And just to like go back in time, I think,

you know, when I joined Instacart in 2015, this idea of like, are people really going to shop for their groceries in 100 years, the way they shop for them 80 years ago? Like, it certainly doesn't seem like we will do that. You know, this is inevitable that it will go and it'd be different. I think that to your point, it is harder to figure out what things are inevitable right now because the world is changing super fast. So I think one, you've got to be like more limited in that, right, of, you know, what are the industries that will be durable? I think the, there are two things I would tell you to answer your question, though. One, I think network effects are still potentially even more powerful than they've ever been, which is I think if you get a company with a network effect and you

execute with excellence and speed, I think you can keep going and build it even up more. And you never want to predict what the AIs are not going to be able to do. But I think it would be hard to say, press this button, Claude Code and create a network effect of highly fragmented buyers and sellers. And so I do think network effects can endure. And then I think the biggest thing is the people which is you need the people that you will trust to go and face these realities. And it's the same way, honestly, like, I know I got called Unk on Twitter today, but I'm going to go with this. It's the same way with your kids, which is you want to prep them for every possible situation that's ever going to happen in their life. But the reality is you can't.

And all you can do is make sure that they're actually good at reacting to tough things as a general matter. And that's the same thing I think that we think about it. Yeah. Yeah. What's the changes we're going to see. what you want is to trust that the people you have are good at responding to those things with true seeking, with agency, with aggression. And I know on that dimension, I know Pat and I agree. There's also, there's a Jamie Diamond line, which is it's easier for me to predict the next 10 years than it is for me to predict the next quarter. And part of what goes into that is the forces

that shape the next 10 years are kind of so big and so obvious that you can actually make, in some ways, higher fidelity predictions over a longer period of time. And I think similarly with our business, if you look at, like, for example, can you imagine a version of the future in which doctors aren't using all of the world's medical knowledge on an application in their pocket to make better decisions at the point of care? Of course not. Like, of course that's going to be a thing. And, you know, like there happens to be a company open evidence that is doing that today for a decent in fact of the doctors in the country, but like, obviously that's going to be a thing. Or by 2050, are people going to drive cars in 2050?

I have a hard time believing they will. Like, it's going to be the way people ride horses today. Like, you might do it as a novelty, but it's not going to be the way you get, you know, to and from point A and point B. And so there are some things where you just like know that it's inevitable. And it's a question of, okay, well, what's the path from here to there and who is it that blazes that path? And that's where it can be tricky.

And I think that's where Rovey's commentary on the people really come in, one trap that it's easy to fall into is theorizing on market structure and different technical approaches. And the reality is, if you can figure out the best people, they're going to figure all that stuff out. They'll figure out the right technical approach and right business model and all that stuff. If you just figure out the right people, they'll probably find the path. I think one challenge right now for founders that are trying to navigate the world is like, you know, 10 years ago, if you were looking and trying to understand the dialogue in different narratives and conversations happening in tech. It would be like 99% kind of like market analysis,

product analysis, 1% science fiction, fan fiction. And now the narrative and the conversation is like 50-50. It's like some like kind of like tangible analysis of what's actually happening and how markets are evolving. And then 50% like sci-fi fan fiction of people writing like, it's possible that in two months, like you'll be able to buy a galaxy. What does this mean for a series? And so like you kind of need to, you kind of need to like drown that out and like pay attention like that goes back like just talk to customers what do they what do they need today for sure react to the game on the field do you guys think that uh we were debating earlier it feels like AI is is doesn't have its Steve Jobs from a messaging standpoint like I would love an hour an earnest you know

conversation of an hour from a from Steve Jobs or a Steve Jobs like figure talking about because I feel like society broadly underrates AI. They see the slop videos and they see the idea that their electrical bill might be going up and they're like, I hate this. Or they see the slop and they hear they might lose their job in a couple years or they can't find a job and they're like, I hate this. And it feels like we don't have anybody right now that can go on, that can go, like, when, you know, as great as the Elon's and the Sams and the Darius and people like this

are as operators and builders and visionaries, when they go on podcasts and those videos go out, the comment section are all like, please, no, stop, like, turn it off, you know. And so it feels like we're missing, we're missing a, or maybe it'd be impossible. I don't know. Yeah, what do you think? Oh, I agree with you. I think we are missing that person. I think Pat and I are both in the meeting yesterday, though, that this kind of reminds me of

and I will share it on his behalf. But like, Alfred shared a story the other day, yesterday about his dad, okay? and I think it is pretty instructive in terms of this thing. So Alfred's dad, I don't think this is going to surprise you, was a pretty brilliant guy, right? But what his job was was to be a human calculator. Okay, like literally, like sit in a row, like do math, like, you know, be a cell in Excel, right?

And just be a human calculator. And at some point, what technology allowed was for him to not have that job anymore, right? And someone with this giant brain and this ability to produce and help society could all of a sudden not do math and put numbers into one cell anymore. And he could have way more impact and build an accounting system for the company that he worked with. And all of a sudden, all those other people who have huge brains, right, could go do that because of technology. And he made this point, which is like, look, technologies neither good nor bad. It's what we do with it, right?

The same technology that powers a nuclear bomb can power a nuclear power plant. And so the idea is like, what do we do with it? What do we do with it? What do we do with it? I do think that a lot of what people are doing when they go and talk about the technology is they talk about all the things that might happen. I would rather us talk about the fact of it's going to get more and more and more and more incumbent on all of us to make sure we use it for something that's great. And I actually genuinely believe that. I've written about this before, but like, you know, if I could give my kids one thing, it wouldn't be kindness, it wouldn't be curiosity, it'd be agency. And this is that same point, which is like, listen, the technology is going to be what all of us make of it.

You know? And I think Alfred's point sat with me, which is like he talks about his dad being able to do more with his life so that his son could do more with his life. And a lot of that's due to technology. Like, there's nothing better than that. Yeah. Well, that's a great place to wrap it up. Thank you so much for taking the time to come chat with us. And congratulations on the move and everything.

Yeah, super excited for the new company and the evolution of the role. We buried the lead, but we got to have you back on as soon as we know. more about what you're building. And we would love to do it here alive. But congratulations to you both on all the progress. Hope 2026 is a fantastic year. And happy new year to the whole team. Happy new year to the whole team. Thank you guys. Cheers. He mentioned Jamie Diamond. There's some breaking news about Jamie Diamond. J.P. Morgan is taking over the Apple card program from Goldman Sacks. That's very exciting. Also, let me tell you about Turbo Puffer, serverless vector and full tech search built from first principles on object.

storage, fast 10x cheaper and extremely scalable. And you know who we got next. We have Ben Smith from Semaphore on the best day of 2026. How you doing that? Look at this setup. Look at this setup. Thank you. Thank you for having me. Upgraded setup. Upgraded? New round. New round, new setup. The dollars are already at work. I see. It turns out you can spend $30 million on a podcast. Look at us. We have a gong. We have a horse. We have all sorts of stuff. We need to ring the gong. Give us the details. What was announced today? Media is back. Media is a hard business. I've spent my whole career mostly at media startups.

And it's exciting to be at one that's working as a business. We're profitable last year. Wow, one person clapping. Sorry. Whole team clap. I had to hit me. We love profit. We love property. We love property. Chiching. I mean, honestly, that is how I feel like I'm a journalist and took me a large.

part of my career to realize that the goal that you're trying to bring in more money than you spend because I'm mostly, you know, obviously trying to hire more journalists. But, you know, it's a tough business and having been through a bunch ups and downs, it's just very exciting to feel like we've kind of figured out a sustainable model to do really quality journalism. That's great. Talk about why true journalism, not, you know, a newswire account that's sharing fake news, is more important than ever. Because if you feel like it feels like actually getting information from a journalist that did original fact finding on a story is actually more important than ever. I've when I used to trust stuff, I feel like you actually could trust a headline on social media a lot more five years ago than you can today. And I think it's only going to get more insane as you can't even trust.

like you will get to the point where you can only trust in some situation, somebody that actually did the fact-finding because somebody else could make a video easily. Of some news or an interview that just never even happened. Yeah, I mean, I think the, you know, and particularly for our audience who in these different verticals that were in from, you know, from tech to finance to D.C. are often the most informed, the most plugged-in people,

the people who ought to have access to the best information. They probably like you and, me feel like on one hand, you're totally overwhelmed by the volume of incoming, and then on the other hand, don't know what to trust. And so we've just focused very, very intensely in delivering kind of careful, straight up the middle trusted information from journalists who, like, good beat reporters are real experts. And often in the kind of traditional journalism, you're supposed to kind of hide your point of view or find some way to smuggle it in through expert quotes or adjectives. And I think, like, our view is, you know, the audience,

particularly sophisticated audiences caught on to that. You'd rather just hear directly from a journalist who they're talking about, hear what they think with some room for disagreement. But really, like, the place we found value as a business, too, is both in these email briefings and in these big convenings, in this big one we do in Washington, that people are just, like, very hungry for trusted, really smart, dense information from the source.

Yeah. What are the underrated strategies that you use? I feel like Semafor is interesting because it's a place that it has the patina of like legacy media almost. And I mean that in the best way possible in the fact that you land on a semaphore page and you trust it with the authority of other larger, older institutions. And that's not true for every new blog or substack that pops up because anyone can spin those up. Anyone can spin up a website, but you've built a credibility very quickly. Do you know, like how, as you reflect on that, like how did that come together?

I mean, I think it is partly that you sort of have to realize that we're, we're living in this very kind of talent-driven moment. Sure. And we definitely kind of built it to provide a platform for great reporters and great beat reporters who mostly, with some exceptions, but mostly aren't going to go out and do a substack. Because, you know, particularly if you're a beat reporter, you might be telling this side what they want to hear today, but tomorrow you might be telling them what they don't want

to hear. And that's not always the best sort of creator model. And so in any case, we provide this sort of platform. Not to mention, not to mention some of the stories, like, there's certain stories that take six months to do properly. You can't do that if your audience is like, I pay you monthly for this thing and you're not delivered. Yeah, and you might need legal support.

You might need a team, some editing. I mean, we've broken a lot of news because we have a guy in Riyadh and a guy, you know, and somebody in Silicon Valley. And a lot of the chip stories are really Gulf Washington Silicon Valley stories. And you need legal support. But no, but I think, you know, it's funny. Almost what you say about our design is true. Like, that's definitely we are trying to, you know, take the best of the,

the values of legacy media in terms of fairness and reliability, but then also give a real kind of condensed intelligence. I actually think the thing that people, that helps people trust you now is if you can pull in points of view from people who disagree. A lot of what we do is try to read across the whole internet and say, here's what the Chinese media is saying, here's what the Japanese media is saying, here's what the right saying, here's what the left saying, and not try to shove our own perspective through. Yeah.

What about the events business? I'm very interested in understanding how you're splitting. your time, how semaphore is thinking about these two. There are obviously a lot of synergies, but they are two different projects. I imagine there's different folks staffed on each side of the business. Walk me through the thesis there. Yeah, I mean, this is actually sort of a nerdy journalism industry point, but a lot of the events business in newsrooms, the newsrooms I've come up in, it's like you have a journalism business that's often based on scaled web advertising, that starts collapsing, and you panic and look for other businesses that work better and

staple on in events business. That's what a lot of news organizations have done for, you know, two better and worse degrees. We definitely started with the premise that we're talking to an audience who were, and it's the same audience. We're reaching them in emails, but these are decision makers, these are all the tops of government and businesses, reaching them in emails and convening them in person. And they want to hear from the same journalists. And they went and so our journalists who are writing the briefings are the ones doing the interviews or the ones figuring out how to structure and events so that it's interesting. I mean, but of course, as you say, also, you know, in some sense as an old blogger.

It's incredibly easy to sit in your pajamas and type things, and then, like, incredibly hard to put on an event where the security is perfect and the food is perfect and the music is great and the staging is great. So we do have an unbelievably capable team of people who do that. Is there something just understanding, like, the journalism that happens at an event? I experienced this for the first time last year

where every interview that happened on stage, the key quote or the key fact that was discovered was turned into an article, is that sort of a virtuous cycle where the events, businesses, and the actual publications can work together synergistically when it's done right? Is there something that they're maybe less disparate when they're done well? Yeah, for sure. And I would actually put it more on the other end, which is like you definitely go to events that are not journalistic and that are fundamentally kind of promotional. And the interview is often like the chief marketing officer of company A, is interviewing the chief market officer company to be. And the thing is, like, journalism, like, and tough interviews bring a kind of

tension and drama and interest, and you lean forward. I mean, deal book this year was amazing. It was just, like, it may as well have been a pay-per-view boxing fight in some of them. And it was amazing content. It was great content. It was so good. Yeah, and people want to watch, you know, like us well-informed interview. And again, like, whether they're a journalist or not, actually, they, like, professionally, like, ask the hard questions. So the thing is, like, smart CEOs would also rather be asked hard questions, then sit on stage for an hour and, like, recite monologues that they memorized. Yeah, I want to watch a serious journalist ask a public official, a hard question, and have that

public official turn around and call a pop historian. That's what I want to see in the back. Exactly. Yeah, and then the thing is like, we were, we were, uh, off air, we were doing, uh, we got invited to, like, moderate a panel last year and they've, and the PR person gave us some question. Here's like, here's some, we'd love if you ask some of these questions. and the first question was like, you have changed the world in so many ways. How could you possibly do this? And we're like, yeah, I don't think we're going to ask that one. Right, because you're thinking about the audience, right?

Yeah, and having an interesting conversation. Right. But what was the real catalyst to raise your profitable? That gives you the luxury of saying, like, we're going to be here for a long time. But I imagine there's a lot that you want to do with the money besides your new podcast set up. Yeah, well, once, you know, with what's remaining from this lavish room. Yeah, you know, I mean, I think really two things. One, we're going to hire some more journalists.

Like, we're, you know, we're a very light team. I think we're about 50 journalists. And I think in their places, particularly, you know, the Trump story in D.C. And the global business story where we just have some hires we want to make. I don't think the newsroom of the future has a thousand journalists the way the old ones did. It's kind of like in a post-industrial world, it is fewer people, I think. But between the technology that helps. helps you and the audience wanting to connect with individuals, but still, we are very eager to

hire some more great journalists. And then, as you would imagine, the convening business, it's like an expensive business. Like, we're renting out the Conrad Hilton for a week in Washington in April, and that's like, it's amazing. That's great. That's great. I want to ask you about the anatomy of hard questions. I was listening to Joe Wisenthal talk about this, and he said that oftentimes, audiences want people to ask hard questions. And they imagine a situation where interviewer sitting down someone and they say, are you a fraud? And the interviewee just says, oh, you got me. I am a fraud instead of just them shutting down and just delivering a talking point. So what makes for a great hard question where something's actually learned?

And when's the right time to move on from a hard question? Because we'll get, we have a chat, right? So if we're talking to somebody, people will be like, ask them about this specific thing that happened in 2019. And we're like, Is that, does that need to be rehashed? I mean, there's like 50 other interviews that got into that. It was not great, but can't, let's focus on, like, what matters now. Yeah. Yeah, you know, it's funny.

I think I was, I may have been Laura Loomer's, like, first victim many years ago when I was at BuzzFeed, and she came up to me. She was still, like, kind of young nervous, Laura Louber and her hand, and her hand was shaking on the camera, and she just asked me if I was fake news, which is, like, one of those questions. Like, what are you going to say? You're not going to, like. You got me. Ben fake news, Smith. I think it's, I think actually it's a sort of about creating an environment of mutual respect almost in a certain way, where they feel committed to the conversation and you're asking serious questions and you're hopefully asking things they haven't necessarily been asked before,

but that are really top of mind and whatever is like the core question. Like, why did you, like, why did you make this decision? Like when I look at this decision, it looks kind of reckless. Like, why would you do that? and just sort of are sometimes like kind of verbalize the criticism in a respectful way and really but push them to actually respond like bull fighting you know like the journalist has the thing and the bull is running sometimes the bull runs straight into the journalist right but you know you're yeah it's a dance it's a great metaphor nailed it and sometimes you want to just run right into

them though i do think like yeah exactly if you feel weird and bad asking the question sometimes that's a really good question like if you feel like ah this is a little awkward yeah yeah that's We got to hit the gong. Yeah. Give us the details of the fundraise. Yeah, who came into the round? Because it was really a who's who of saw Henry Kravis. Yeah, it was really, I mean, it was honestly like a great vote of confidence.

A number of our existing investors came back in, including Henry Kravis, David Rubinstein, Georgia Palo Laman, the Gallup organization. And then some new investors, including a couple of great European media investors. again, I'm Thomas Leeson, and Penny Pritzker, the former Commerce Secretary. That's right. That's right. Well, we're excited to see you put it to work. We're very excited for the event next year, or this year, and the rest of the year. I hope we can get you there. Do you ever, do you travel? Do you go east? Can we like drag you to this event? That would be a lot of fun, yeah. We, I mean, let's check the schedule and stuff.

We're working on figuring out how to bring the show on the road and still do our show while we're at other things. It's a lot of measurements. The show must go on. That's our non- The show must go on. I would love to find a way to get you on the road. It's April 13th to 18th in D.C. Cool. Yeah, we'll talk that. Prepare for your Trump interview.

Fantastic. I don't know if we'll ever. Purely business and technology focused. We should inspire. We can talk to him about truth, social, or world liberty or, you know, many businesses. We could get sacks. I bet Sacks would talk to you. I don't know if you talk to me.

Yeah, yeah, yeah. Yeah, we'd have fun with Sacks. Let's work on this. I introduced him at Miami Tech Week three years ago or something. I was the MC. You got asking part questions. Yeah, that'd be fun. Well, thank you so much for coming on the show.

Congrats on all the progress. Yeah, congrats to the whole team. It's awesome, like you said, voter confidence. And I'm excited for you guys. Sometimes you're like a company raising money, and it's like, okay, they have more money. But I'm genuinely excited for you guys to have more money. Yeah. Be able to do more.

Thank you, guys. Yeah. Thank you. And thanks for having me on. Awesome. We'll talk to you soon. Cheers, Ben. Have a good rest of your day.

Goodbye. Our next guest. is Jacob Ritamaki. He's written a fantastic piece about humanoid robots. Before we bring him in, let me tell you about console. Console builds AI agents that automate 70% of IT, HR, and finance support giving employees instant resolution for access requests and password resets. Let's bring in Jacob to the TBP that Ultrum. Jacob, how are you doing? Hello. How are you guys doing? We're doing fantastically. Great to have you here. Is your 2026 off to a good start? I think it is, yeah. Since to be honest, like just some backstory for why I'm here.

About a month ago, a friend of mine was like, oh, you have some interesting thoughts about robotics, about kind of the data center market. You should like write something up, but it's kind of like a small piece. And then it took a month instead of let you go a couple days. It's spiraled. We had a whole section, Dorcasch release a piece. So we have a section on that. We have a section about kind of the future.

We have short stories. we have like a whole like financial model we've built out. It really spiraled. And no, I'm having a great January because it's now, it's no longer raining in San Francisco. It's actually sunny today. I think this is a good omen.

Yes. Believer in omens in 2026, omens are in. Omen's are in. Omen maxing. That's a great call. Omen maxing. Yeah.

I think Tyler, he speaks a lot about this. Yes, yes. But I need to be on the, you need to be open to omens to find them when they're sitting. I think so. I think that you do have to be open to strange things happening since I think that's kind of like, you know, to talk my book for a little bit.

Like, that's kind of the point of this essay is that not only is this going to happen a lot faster than I think people realize, it's going to be a lot stranger. Like one thing I've heard people bring up is this idea that as you could call it like the bifurcation theory, this idea that as we get whether it's on air, AI or whether on robotics, we're going to get this like robot produced quantities of goods. Maybe it's images. It's media. Maybe it's clothing. Maybe it's food. Maybe it's these other sorts of opportunities.

You have people like Ariommanuel kind of betting on the idea that there's going to be the split. There's going to be the live world and that you're going to have like the human rare quality stuff and then like the infinite robot slot. But I think that's you can add a little more nuance to it. Like for example, I think that the idea that. human only fashion is probably it's going to be very niche. And the reason why is simple. If we look at something like shine and we say, okay, we can cut the costs another 10 times and the quality is something you would wear at the Met Gala. Most people, frankly, aren't going to be able to tell the difference in their tailor. Maybe we could get like the menswear guy on. Maybe he could tell.

But I feel like most people, they're not going to be able to tell the difference. They're just going to like click the buy button and go. But there is something where I think that like in health care within an industry, you can split it up into sub portions, like the logistics of actually bringing medicine to people in, like an urban hospital or someone, like in NYU, that's probably going to be done by robots. But the actual care for people, like people want, if your child is sick and about to die, unless if, you know, this doctor is about to do an operation, you don't want to see a robot looking over your child. You want to have somebody to be able to kind of absorb that fear, to absorb these emotions. And if you take that and you say,

okay, wow, that was like maybe slightly different than what I would have expected. And apply that to literally every part of our society in the next decade. Yeah, it's going to be a lot. It's going to take you a month. It's going to be hard. And I'm glad that people starting to see this. That's kind of why I wrote it. Where are we in terms of humanoid robots?

Or would you even use that term? Is it more just useful to think about physical instantiation of artificial intelligence, just robotics broadly because maybe they won't look like humanoids, but it's still going to be transformational. Are we, like, you know, you see these stats where I think Amazon employs a million robots already. Do you see it more as like a continuous process? Will there be an iPhone moment, a chat GPT moment? Like, what are you waiting for? Okay. So I think there's a couple of ways we can look at this. One of them is a really interesting split. It's between manipulation and navigation. So navigation has been a much easier problem.

And the reason it's an easier problem is that we've been able to use classical methods. We don't need to collect a lot of data for a warehouse robot to kind of like move around and move the boxes around. Even self-driving. Like it's not, self-driving wasn't the hard problem. Getting it reliable enough so it doesn't kill people was the hard problem. But manipulation is difficult. How do you encode this is like an idea that Andres Carpathie kind of spoke about in software 2.0, you can't really, you can write a program to say, oh, I want a robot to go forward

and it's going to go to left, it's going to go to right. How do you encode this idea of I want it to pick up this goldfish? You know, I'm not sponsored by it, maybe someday. And, like, I think that, you know, that's kind of a weird thing about the robot future is that, um, I've written about robot holidays. I think there's going to be probably some weird relations. There's going to be all sorts of cults. It's going to be, you know, there's, uh, um, I, um, I, also wrote, I did, what is getting one-shotted or having LL psychosis? Like, like, humanoid robot psychosis? That feels. I mean, I think that like Isaac Asimov, he wrote about this back in the 60s. You have roboc psychologists. Like, they literally wrote about like this robot going insane.

This is the positronic brain. It got modified. The three laws, you kind of, you know, I think if you kind of remove the rule of like, wow, maybe we shouldn't kill people. That would be bad. Yeah. What about There we were talking Reading a post earlier about Tesla with Optimus like doing a bunch of supplier Selection seeming seems like they're

Gearing up to actually make a lot of these things and I think Some people are somewhat surprised by that because everything we've seen so far from humanoid has been like Kind of like cool cool demo but not like oh I need this in my home today or I need this at my warehouse today. Yeah. I mean, I think there's a couple of things. One is that on the home versus enterprise, enterprise is going to be a lot more valuable. Not only because home is distributed, you have safety stuff, the costs.

There's also this weird tax thing in the one big beautiful bill. It's called the 100% bonus appreciation clause. CFOs, you should listen to this. You can depreciate whatever asset you want. It's uncapped in a year instead of five to seven under this, as long as it's kind of in the US, so you can do it for data centers, robotics. Like, I think there's just a lot of things that are going to push for enterprise adoption first. But then within enterprise, I think the supply chain, why people are going to get side,

they're just going to get blindsided by this, is that a couple of things. One, if you're focusing on how bad America is at manufacturing, you're focusing, it's important, but you're focusing on the wrong thing. You need to focus on how good Asia isn't making stuff. In particular, Peng Yang in Malaysia, Bakni in Vietnam. Taiwan, underrated, South Korea, Japan, obviously China, Shenzhen, Wondong, lots of places. So Asia is going to be really important. You can also repurpose other industries. I talked about this with rare earths processing. Since rare earths aren't rare,

you know, as Trump said, but like the actual processing of rare earths in the same way, like standard oil became a monopoly off of processing. China has like a processing monopoly there. you can just repurpose the oil and gas industry for processing rare earths, which I haven't spoken about. People have spoken about it, you know, for finding the rare earths but not reprocessing. And in the same way, you can repurpose the automotive industry for like humanoid robots. Like you already have Honda, you have Toyota. These are already people that are integrating it. You have the same actuators.

You have the same battery management systems. You have everything else. It's something where the auto oilms, we're in a secular slump right now. So if you're not, if you're believed, that's kind of, it's like, it's like, like the Socrates thesis in some sense of that, you know, auto is in this sort of like secular slump. And then as we kind of like, in order to break this slump, we're also going to have robots. So it's going to be this double whammy of people are expecting, oh, you know, this sort of dying industry, it's stagnating, you know, profits are being competed away. Tesla is kind of,

it has to sell the energy story, the AI story, the robots story, the cars aren't, you know, doing it as well. B.YD. Like, I think this is a Dan Wang point about China. It's weirdly more capitalist than us. Like the Tillion idea of capitalism is bad in some sense because you're competing. You're constantly, you're trying to compete everything away. So in some sense, China's more capitalist than us. Everyone's competing. That means that the auto industry is in a slump and it's looking for something to save it.

I think robots are probably going to be it. And even China right now, like Unitary, there's kind of, it's whispers of that, oh, are they going to delay the IPO this year or stuff? Because the hardware is getting ahead of the software. So it's something where I'm like, I don't see the hardware. And you can just rely on if you have like, you know, expensive precision reducers or some of these other things. Like you don't need rare earths to make a motor. You don't need expensive precision reducers to make an actuator.

You can rely on cheap stuff. The thing that's going to like do my like, you know, surgery or stuff is not the thing that's going to stock shelves. And we just have like Omi or like how people are collecting data now with the gloves. You can 3D print stuff that's like a pretty good embodiment. match. I'm just incredibly bullish. A few years ago, you could have asked me, I was said no, but now it's like, no, it's the sign that this is going to be big. It's going to happen fast. You would mention before, John, about, you know, humanoid versus other form factors. The key word to think about is payback times to borrow something from finance in that the faster your payback

time, like the more that creditors are going to want to lend to your business, since it's not just going to be venture capital. It's going to be the entire private credit industry. It's going to be private equity. It's going to be RAS. It's going to be all of these other things. So you've got to think, okay, how do I drive my payback time down? CapEx is one component. You get rid of the legs. You have a wheelbase or you just even get rid of the mobile stuff. You just have arms on an assembly line, assembling, you know, AI servers or GPUs and you just crank the infinite money printer. But even more so, it's not even the CAPEX. I feel like a lot of investors and a lot of people, they focus on the bomb, they focus on the

Cappex. They should be focusing kind of on the OPEC, on all of these metrics of saying, wow, If this thing is going to run, like, industrially rated robot arms already exist, it's fine. This thing is going to run for 30,000 hours. And I built a calculator on the website so you can play around with it yourself. This thing is running 30,000 hours. And every day, it's like 22 hours with some maintenance. And it's like pretty close to a human or stuff. That is going to be the dominant term for like whether I'm going to get a good return on investment.

What my, like my blended levered IRA is going to be all of these other sorts of things. It's like there's just a lot that goes into it. And that's why, like, I want people to read this. Like, I don't want this to kind of be like, oh, I like this. And then we had like a discussion once. It's like, no, I really tried to talk to as many people as I could. See your butt down and study. Yeah, basically is like it's going to be big.

It's going to be a big deal. And I try to read it to be fun. I don't want it to be homework. Like, I feel like the idea of like, I try to. to write it in the way that's fun and not, you know, because you could just go down and read some textbook or some, like, schizophrenic supply chain reading or whatever. It's like, that's just not fun. But I tried to make this fun. What's your, what's your thesis on land? I've had this idea that Oh, it's in there. So, yeah, I, I was trying to find it. But basically, I've had this idea that, like,

if you can build things, you know, 10, 100 times faster, let's say you could build a factory or multifamily apartment building, you can potentially start getting a return much faster and it's cheaper to, you know, make infrastructure, things like that. But yet physics, the laws of physics will presumably still apply, which means that it might be more convenient to have a factory like next to a city versus somewhere random. So I've had this idea that like it's possible there's like a situational

and awareness style like real estate fund that could start thinking about how the value of land will change as you have advanced robotics that can kind of accelerate progress and just build things quite a bit faster. But how are you thinking about land in the context of advanced robotics? Yeah. So in the back up a second, I think that the four factors of production classically are land, labor, capital entrepreneurship. And all of those are covered in this.

but we're going to focus on the land for a second. You can split it up into what is it going to look like from a consumer and then an enterprise perspective, because consumers and enterprises, they're going to be looking at this differently. From a consumer side, I think that the originals will appreciate in the sense that like long Europe, long like historical sites, long existing cities of that it's going to be very hard. Like the idea of, oh, we're going to get cheap housing because construction is now done by robots. I think for Austin, for the South, we're going to have a lot of that, but I don't think that's going to solve San Francisco or New York's Politico woes. And then from the enterprise side, I think you're correct.

I think that in some sense, the final offshoring may be the greatest reshoring will ever have in America of that you go from being constrained by not having this tacit knowledge of manufacturing or enough people or it's all expensive to now you have the energy resources, you have natural gas, you have IP. that's going to be very important. And yeah, maybe we don't have to put it right next to San Francisco. But, you know, you go out west, you go down south. You could just kind of let things start the rip. I know that Texas in particular seems very primed from a regulatory perspective. I would also say, I think that, like, for the idea of land taxes or land appreciation or stuff, that feels somewhat deep into the curve.

Like, I think this is why, like, Georgia's has always been like this great idea in theory but not in practice. And this is kind of what Dorcasian Philip talked about in their essay, is that there's so much of the gains initially are just going to come from capital. Who owns the factories, who owns the energy, the data centers, that by the time you get to the point where, oh, I am just going to be Leopold, I'm going to raise a trillion dollars, I'm going to buy Iowa. Like, at that point, like, you should have just been buying like Stargate 2. You should have been the new Taipei. You should have been with Jensen. You should have been in all these other things. An interesting thing of land, though, is that I'm totally a big believer in the whole orbital data center stuff.

Not just because of being friends of a lot of teams, kind of at the SpaceX, XA, I know, some of these other places. But also, like, I think that the thing about orbital data centers, I want to keep this short sense, you could go in a whole rant, is that it trades off one problem, which is cooling. it makes cooling a lot harder in space because you can only do radiative for all of these other problems. You don't have permitting. You don't have land. You don't have a lot of this other stuff. Maybe you'll need to do some radiation hard and things. But I do think that the idea of space data centers is not going to be crazy. In some sense, like I also think because I spent a lot of time saying if you're a robotics company really be focused on the AI like infrastructure build out as a market, it's really good. like every robotics company that wants to be big, you know, is secretly a Dyson sphere company. They just don't know it yet. Like if you think about in the end of what can we do with robots, like everyone's thinking so short term of like if I had 100 million laborers, a billion, a hundred billion, a trillion, like what would they do?

At a certain point, you can only make so many like mocha lattez or stuff. It's like you got to start, you know, building the Dyson sphere. We got to start cranking. Dyson sphere before, Mottes, Macha is the path to the dacinth or after 2100. Yeah, and if you enjoyed this conversation so far, this is like basically 80 pages of this. Awesome. Except worse. What's your, what's your prediction for a Dyson Sphere timeline?

2100 before or after? Hmm. I mean, like, what do you count as a Dyson sphere? Because I feel like if I'm sorry to be like a fantastic, like, an antigen, like, asshole about this, but like what, what do you count? What do you count? Is it like, oh. It doesn't need to capture a hundred percent. Let's call it.

But like a meaningful percent. A meaningful. it's called over 10% and definitely like a structure that is like like gravitationally locked to the sun not the earth so it's not just like a bunch of random starlings scattered about in the stars it's truly like around the sun before 2100 um but then there we go I think that it's the problem you know we can hit the gong on that one we're gonna pull this up when it happens We're going to pull this clip up.

I don't know. But I think, though, for like the whole Dyson's Fair stuff, it feels very much. I don't know if you've ever heard of, like, the parable of the back half of the chessboard, that, you know, this king one day asked, he had a kind of a checkers board, one grain of rice on the first one, two on the second, four on the third. By the time you get the 32, by the time you get the 64, like, it just, you know, swallows the earth. I think it's something very similar here. Like this idea of robots building robots, which is, again, in the essay, people should read it.

Like, that's the point of this. Like, read the essay. But Fannick has been doing, they're like this robot arm company. They've been having robots building robots for 25 years now. Like, that's older than me, which is astonishing. But it's something where, granted, it's in a very limited narrow capacity of that. You have to scope everything for safety and whatnot. But it's the idea of like, oh, robots building robots at some like sci-fi.

bullshit. Like some of us don't have to live in Berkeley or whatever. But, you know, I do think that it is going to be more plausible than not, particularly because, you know, talking about the AI data center build out of stuff, the ODMs that are making all the AI servers, all the GPUs, everything, all the chillers, everything that's going into the data centers, or even from it as a prefab perspective, are also the people that could do consumer electronics. They're the people that could actually build the robots. So if you're servicing these customers or stuff, you're servicing these industries, it's like, wow, you know, they're going to want to start building it themselves because it lowers their cost.

It increases their margins. It's going to be something where the market forces are going to be very powerful here. And that's also why, like, we spend a lot of time on the social sections of this, of thinking about taxes, about, I think sovereign wealth fund initially, like between Bessent and Lutnik, there's a lot of really interesting ideas that you can start off with so you don't drive away the business community. But I do think that there's a lot of factors pointing to. like it's going to go from 2025 people, maybe they saw a physical intelligence video or something to 2027, it's like, holy shit.

This is actually happening. Like, guys, I know that you wanted a robot horse, John, or something. Yeah, we have the dog. I need the horse. I feel like the robot dog's a little played out. The robot horse, that's it for 2020. Nobody has that yet.

Steve is a very... Steve is a very... You would think they could just scale it up. Just scale the dog up. Yeah, you make a bigger dog. They kind of have. I mean, the MIT Cheetah stuff. They kind of did scale it up, but it was like,

but that's not the same. It looks lame. It has to look cool. Horses. But I also have to look cool. I feel like that's also part of this essay was like, like between clog code and other stuff, like I got a lot of compliments on what it looked like or so on.

I think that the Marshall cost of making a good website's going to zero. Same like physical labor. Marshall costs of physical labor is going to zero and my website as well. Might as well. Like, you got to make a good website now. I'm probably being clapped out, so I'm going to leave. No, no, no, you did. I was clapping for your website.

It looks fantastic. Oh, thank you. Making a beautiful, making a beautiful website for an essay is the new meta. Yeah. You just, maybe the AI 2027 people, maybe they get some credit for it. But you also need a PDF.

Is this available as a PDF? Yes, it is. It's available as a PDF. And also, if you want the secret, here's how you make a good, how you make a good you want to make a good PDF?

Okay. So if we start with the thesis that like Claude Code like is God and does everything then Of course. That's what it does. Well, obviously.

I mean, have you seen the new atropic price 350? I mean, pretty good. It sounds like God pricing. The market capitalization, not the share price. Got it's true pricing.

Yeah. I mean, I think it's still grossly undervalued. Like add another zero or something of this. point. Like, um, sorry, sorry Morgan Stanley. Sorry Michael friends were going to need to have that one. But, uh, I think that like, uh, he, yeah, well, I mean, I think he's busy with XA on all that stuff, but, uh,

they also had their recent round. Um, but I, I do think that if you treat, like, what in my life can, is secretly a cogeneration problem, I think that making really beautiful PDFs is that because latex, which is mostly used by like math nerds, um, to render math research papers is a programmable way of creating documents and PDFs. Like if you wonder how Leopold, I didn't do the footnotes here because my side notes and footnotes were completely crazy and it just like cluttered up the side and looked onesthetic. It looked awful. And the website was the better medium for this anyways.

But I do think that the idea of saying, oh, I have this really great piece of writing. I'm going to put it in the clog code. It's going to render it in latex. You can get an overleaf account. it's free overleaf.com. And then sign up, you can just like make these documents. You can have it be very expressive or so on. And then you can make like a really nice website to go along with it since it's not just about the raw content.

It's also how you say it and then how it's presented. In the same way of that, oh, you know, I see John and Jordy. They're going down to Tartine, which I thought was an SF thing. I was told by Michael it's now like it would start in LA, which is a bunch of bullshit. Like it really like that's something. I, it's like, it's like, the open AI people go to. This is not like you guys ordering the, um, we invented Tartine. I'm not going to say that.

Open AI merely adopted. Yeah, we exported it to you, to you folks. We exported it to San Francisco. Wow. We did. First time that's happened. Um, I think that, uh, but the thing, though, is that, you know, if you add, like John and Jerry, if you both had, like, oh, we're going to, you know, write about technology and

business, which, I mean, I, I'm a daily active reader of John's newsletter. So I think that, you know, we can pump that. Let's go. Maybe I should turn into a 90-page PDF every day. Just call it. Well, I think you can render it as a website or you can, you can't spice it up. I feel like it's 2026. You got to not same old.

You got to, you got to get that. Wasn't it the whole loo stuff? It's like you got to be real. You got to be. You can't be like all these other people. I mean. Yeah. There's opportunity.

Well, we've talked about doing a daily print newsletters, somewhat like a newspaper. Yeah. Oh, I think. The only problem, though, is that it's kind of like, well, I mean, like Colossus does it better. So it's like... But that's Evergreen. That's Evergreen. This is more just you literally throw it out at the end.

You're not collecting. Yeah, yeah. You're not like, you're not keeping our... Most people are not keeping the four-day-old. It would be a beneficiary of robotics because it needs to be printed and delivered within like two hours of the news breaking. So it's like uncannily fast. And that's a unique product. but who knows. Maybe it's too sci-fi.

Maybe. I feel like that's a little, that's a little too-sy-frey. A newspaper, they write this thing, it gets delivered every day, make it make it make sense. Yeah, it doesn't make it all. I don't know. I'm not going to work out. Can we interest you in like some New York Times like games inside? Can we interest? There we can do. An app we can do. Yeah, you should add some games to this. Yeah. What's your game strategy, vibe code of something? Shultz, what are you doing? For an oxhole thing, like he wanted some games or other stuff fun. I was like, oh, you're just keep

economics and this. I mean, it's a slider. That's not fun. We'll add games in the second version of this. You need to build an entire Stolaris or Hearts of Iron four spin-off game, Dwar Fortress spin-off. This was like Schulte was doing over breaker. He was honestly, also I have to say like, shout out to him. He was a very, I already knew

he was going to be a very thoughtful editor. He was like even more thoughtful. And I think that his quote tweet, in addition to others are starting to bring attention from people that, you know, not going to be like the class or say who's reading or who's like following now or stuff. It's like, oh, wow, a lot of people look up to him. Like I'm over him.

Like, he's the goat. He is the goat. He is the goat. Let's get it up for Shalto. One of the greatest stuff we're doing. Well, thank you so much for coming on the show. Always good to hang out. Anytime you want to help off.

Great to see you. Great to see you. Oh, thank you. And I'm glad your 2026 is going well, dropping. And just try to, you know, use the tools, try to get one of these. out every day. Please. This one took you, whatever, a couple months. Try to get one out every day. It took me a month, but I feel like, yeah, we got to get down an hour. Every minute you got a new essay. That's new. Fast thing I can read. A thoughtful essay every minute forever. Thank you so much for coming on the show. Hope you have a great rest of your day. And we will talk to you. Cheers, Jacob. Soon. Later. Goodbye. Well, is there any breaking news that we have yet to cover? Or is that where we should conclude today's story, today's show. Reggie James built.

The Situation Monitor. Global activity monitor has a TBPN integration and Intel feed. Tech, finance, politics, news feed, stocks, crypto. So funny. Prediction markets. Tech, layoffs, tracker, AI race news. Is the Fed Tracker? Wait, it keeps going.

Wow. It's just a bunch of everything. Is the Fed printer on? This is amazing. This is great. Turn this into a Chrome. Wait, it has today's episode live streaming on it. This is amazing.

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I love a project like this. This is awesome. And in other news, the team got to the bottom of the large 3D holographic, volumetric display. It apparently exists. It's a 3D display when no glasses required. much bigger, almost the size of the table. Not quite.

Looks a little bit bigger, but pretty cool. We'll have to get a demo of that soon, but that looks fun. Anyway, thank you so much for tuning in. Today, we will see you tomorrow at 11. We'll be back tomorrow. Big surprise, I know, but we'll be back tomorrow. We've got a bunch of great guests for you, folks, and we will see you tomorrow.

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