TBPN Live - Keith Rabois, Ramp's $13B Valuation, Crypto Reserve, Moon Landing, Packy McCormick and Sheel Mohnot

Episode Date: March 3, 2025

TBPN.com is made possible by:Ramp - https://ramp.comEight Sleep - https://eightsleep.com/tbpnWander - https://wander.com/tbpnPublic - https://public.comAdQuick - https://adquick.comBezel - https://getbezel.comFollow TBPN: https://TBPN.comhttps://x.com/tbpnhttps://open.spotify.com/show/2L6WMqY3GUPCGBD0dX6p00?si=674252d53acf4231https://podcasts.apple.com/us/podcast/technology-brothers/id1772360235https://youtube.com/@technologybrotherspod?si=lpk53xTE9WBEcIjV(01:13) - Ramp Valuation (08:45) - Crypto Reserve (51:08) - TSMC Announcement (58:29) - Lunar Landing (01:03:12) - Keith Rabois (01:29:51) - Packy McCormick (01:57:41) - "Garage Mahals" (02:30:33) - Sheel Mohnot (03:02:58) - Timeline

Today is Monday, March 3rd, and this show starts now. We got a great show for you guys today. We're talking ramp fundraise. We're talking strategic crypto reserve. We're talking about TSMC potentially investing $100 billion in America. Let's go. Also, speaking of America, we landed on the moon again. We're back.

Flat earthers. America's back. We should have a flat earther call in. Probably not doing too well today. In shambles. In shambles well today in shambles in shambles shambles uh also we're talking massive garages apparently it's a trend and the wall street journal covered and we just had to cover and we had to cover it it's people are building 6 000 square foot garages 3 000 like four times the size of you know average house in la uh

minnesota built different we're also doing some call-ins today we got uh shiel monat calling in at uh 1 30 hopefully and pacific at 12 30 pacific and so we'll kick it off take you through the stories and uh yeah break it all down break it down john break it down uh let's kick off with i gotta adjust my headphones too loud when i when i get loud it's a little bit too much. We're bringing the energy up. Let's go. Because we've got some big news today.

We do. Yeah. Ramp reached a new valuation, $13 billion. That's a lot of money. It's a big number. And so Eric posts, today, Ramp reached a new valuation, $13 billion. We're not Steve Jobs or Wilbur Wright. We don't invent the next iPhone or flying machine.

Our job is more modest. Save you time and money so perhaps you can. And there's levels to this. They went with the financial times for the write-ups at this point, right? This shows a sign of maturity, you know, skipping over the, you know, typical crunch base, tech crunch announcement. Very cool to see.

And I like that Eric is leading, uh, with, uh, by being a little humble here, right? He's saying we are the platform in which you create the next iPhone, not calling out that they're the next iPhone. And I think that's, that's what you want out of a financial institution. You don't want them, uh, you know, thinking that they're reinventing the wheel and making it all about them, right? You just want it to sort of run in the background. Yeah. You can tell he's been listening to a lot of David Center's podcast, uh, founders podcast, because he says, we got here by taking Charlie Munger's quote to heart, take a simple idea and take it seriously. And Senator has literally said that to me on a phone call before about, about,

about podcasting. So it's a simple idea, but if you take it seriously, it can grow and grow and grow. Our simple idea, save every business time and money. In less than six years, we incorporated have saved businesses $2 billion in 20 million hours over half in the past 12 months alone. Efficiency isn't flashy, but it builds enduring businesses. Sam Walton cut Walmart supply chain down from five components to three. Henry Ford cut the time to complete a car from 12 hours to 93 minutes. We cut the cost to buy anything from 30 minutes to 30 seconds. Ramp puts lessons of history's greatest entrepreneurs on autopilot. Ask Poshmark, who hit free cash flow goals five months early.

Or Anderle, who's able to focus fully on their mission. Or Notion and Cursor, who maintain momentum without sacrificing control. Most companies slow as they grow. That's not happening at Ramp. We're determined it won't happen to you either as we enter the AI age. Finance is going from steer assist to self-driving expenses that categorize themselves and money that reallocates itself for higher returns. That's an interesting vision. Yeah, I love going back to this simple idea. I think every founder, usually founders start with a simple idea and then it gets dramatically more complex.

And then it's a good sign if you can re-simplify it down to just like this core, core idea. And saving every business time and money is a fantastically simple idea that they can build for decades off of that one simple idea, right? So amazing to see. I think this round, from what we know, got done last year,

and RAMP has just kept this ridiculous pace, and I expect to see many more announcements like it this year. Also interesting that this is not a new fundraise that goes onto the balance sheet. It's a secondary sale. Yep. Essentially. And so the structure here is the five-year-old company hit a new valuation as part of a share sale in which investors, including Singaporean sovereign wealth fund, GIC, US private equity group, Stripes, and venture capitalists, including Josh Kushner's Thrive, Coastal Ventures, and General Catalyst bought $150 million worth of employee stock. And so for early employees, they've been working for a long time.

They get some liquidity and Ramp gets to reprice the equity, which allows them to hire more people, show them that they're making progress. Yeah, notably this was above the 2022 mark, which is a milestone. $7.65 billion in April of last year. And yeah, I mean, ramp is known for being, I would say, aggressive and high throughput on valuation and marking the company. That's something that can often be very, very difficult to do for companies because it can sometimes mean you're going down. And that's exactly what happened years ago during the kind of the interest rate hike and the failure of SVB. Ramp was at 8.1 billion valuation in 2022, but dropped to a 5.8 billion a year later as higher interest rates hit

consumer spending, factors that also hit rival fintech companies such as Stripe and Klarna. Fintech obviously went through volatility given the wild swing in rates and spending across businesses and consumers. What I always thought was super interesting about this was that RIP ripped off the bandaid really quickly. And there are a lot of companies that didn't reprice their equity. And there was always a question of, is it a zombie corn, which is something people were saying, but coming out and saying, Hey, yeah, look like the, the market is down 50%. We're down 30%. We're still growing. We're growing into our evaluation. It's actually a very strong sign of strength. And it means that

for employees, companies that fixate on a headline number and are trying to recruit employees based on that, you know, 2022, 2021 valuation. Yeah, three years ago, we were worth a billion dollars. Really doesn't work well for anyone, right? It's really difficult. People will only fall for it for so long. Employees are intelligent. They figure stuff out and they're not going to, you know, they're eventually going to say, yeah, I'm going to go somewhere else. Like my equity is worth a fraction of what it was initially priced at. And, you know, I can go join another company that's priced fairly given their traction. And so they delivered on exactly that. They repriced. So sure, the employees that got in at 8.1 went down to 5.8.

They were like, oh. But at least they had transparency on what that was worth. It wasn't zero, obviously, because there was a round that happened at 5.8. And now it's up. And they can kind of reprice and say, OK, this is what this is. This is where we're going. And so congratulations to the ramp team. We're going to have a couple people call in and talk about where that business is and where it's going. Yeah. So while Paki joined, he's been an early investor in the company and covered their journey from, you know,

early, early days till now. And then we're going to have Shiel on at the end to talk specifically about just broadly the state of fintech, because there was a very long, you know, roughly 700 days where it felt like everybody said fintech is dead. Yeah. You know, this was like a Zerp trend. Totally. These business models only worked when rates were zero. And it's very clearly not the case. So we're excited to have him on and get his perspective about kind of the future of the category and a lot more.

Specifically, the Stripe, Adyen stuff, which he covered last week as well. And we covered a bit. Yep. him on and get his perspective about kind of the future of the category and a lot more specifically the Stripe adjunct stuff, which he covered last week as well. And we covered a bit, but looking forward to getting his thoughts there. So let's get into the rest of the show. Cool. Well, speaking of FinTech, if you're looking to invest, you should go to public.com. Investing for those who take it seriously, they have multi-asset investing, industry leading yields, and they're trusted by millions. and speaking of other investments that you can make that the government might be making the with your tax dollars with your presenting you pay your taxes and then you know the government gambles with them in crypto uh i mean we might have to put on the steel hat for this one as well. And there might be a silver lining here.

We need the steel helmet. The tinfoil hat. We need all of the hats to come out today for the story of Trump. And the story here, the funny thing is, the real takeaway from this is that when Trump plans anything crypto-related, something big is going to happen. First time he obviously launched the Trump coin, got everybody together, got the industry together and said, all right, now I have my own token. And you guys are all sidelined because you're

here in tuxedos instead of at your computer trading. And this time launching the strategic crypto reserve or at least formally announcing it. so the story from the wall street journal is crypto prices jump after trump announces five tokens for strategic reserve and so bitcoin ether solana ripple linked xrp and cardano will be in this in the stockpile and so uh crypto prices surge sunday after president trump said he would move forward on a u.s crypto strategic reserve that would include bitcoin and ether as well as three smaller and riskier tokens. Lots of fun. And the U.S. would actually be buying these. Such an odd time to announce these things. I mean, I guess he seems like he always announces things on like the weekend maybe yeah i don't know because like yeah obviously like a lot of companies they announce their earnings after the market closes

so people have maybe time to process it yeah it doesn't create like chaos in the markets is that why they do that well it's fascinating too because there's obviously you know there's bitcoin etf now you have micro strategy uh there's apps that let you trade those in off hours, right? But ultimately, the sort of traditional financial markets are closed, and he's releasing this, you know, very market moving news on a Sunday morning, which is, you know, it's interesting to say the least. Also, you have to look at the lead up to this, right? His, you know, his son, Eric Trump has been on the timeline pumping world liberty fi uh pretty much daily he's telling people to hodl to buy you know uh so so they're

basically you know they they're they've learned the crypto game right totally yeah uh yeah i i there was an interesting take a pomp obviously like you know super pro crypto but he was saying it was funny that like the crypto announcement happened when the market was closed and so like the traditional the trad five people could participate which is like kind of true but also a lot of the trad five people can't have on chain yeah because they have assets that they trade with yeah they're they're not completely separate um anyway a u U.S. crypto reserve will elevate this critical industry after years of corrupt attacks by the Biden administration, said Trump in a Sunday post on his social media platform, Truth Social. I will make sure the U.S.

is the crypto capital of the world. Trump said the crypto strategic reserve will also include Solana, XRP and Cardano. Unlike Bitcoin, which is the largest and oldest cryptocurrency, these tokens were created more recently and often by smaller teams, making them more susceptible to the wild price swings and other risks. I think it was Naval was saying, if your crypto has a lobbyist, it's not decentralized. Something like that, which I think is a very good take. Let's go through some price action. On Sunday afternoon, Bitcoin rose 9%. decentralized something like that which i think is a very good take uh let's go through some price action on sunday afternoon bitcoin rose nine percent that the counterpoint to that is that a a decentralized uh organization could decide collectively that we should have a lobbying

sailor is like michael sailor is like pr for bitcoin basically and it's not for any arguably some of the most important pr right yeah pomp is you know a catalyst for you know the x audience yeah pomp sailors going on cnbc yeah you know getting normies uh and yeah it has nothing it's still decentralized but it also incentivizes people to do stuff uh and and that was a big that was a big push on like the trump pump and the idea of like you know eventually of eventually – there are so many gold bugs in Congress right now just because over the life of a senator, they accumulate gold effectively. And so the stocks and healthcare stocks and industrial stocks and tech stocks and eventually the assets work their way into our government organizations. And so our representatives care about these things

because they've acquired them. And our next generation of legislators will have crypto assets. Yeah, and one of the interesting things about this announcement is, so it very clearly was priced in pretty effectively because if you went back five years ago and you told a Bitcoin maxi, the U.S.

government is going to be buying Bitcoin off their balance sheet. They would have said, oh, we're looking at a million dollars a coin. Right. Like it just sounded it sounded like a lot of people believe this would happen, but they assume that it would come with such a massive, you know, sort of increase in the price. Totally. And now so yesterday it popped significantly popped around 10 yesterday but today it's actually down uh almost uh uh seven and a half percent so it's down seven percent it's back to 87 000 which is crazy because it's basically around the announcement is almost round tripped and it very well i remember i remember thinking just a couple weeks ago, like what is the next catalyst for Bitcoin moving up? And it would have to be a massive U.S. strategic national Bitcoin stockpile. And I think it also has to be that cascading into every other country saying we also need this.

And so just like there is gold at every federal reserve of every country essentially like they all stockpile gold i don't know if we have any left apparently you gotta put on the tinfoil hat put on the tinfoil hat yeah i'm a believer i believe it's there but i don't know i want to see it yeah yeah at the very least i hope hopefully they spray painted bricks yeah ridiculous uh so bitcoin rose nine percent from it from 24 hours earlier to about 93 000 then you mentioned it round tripped uh what's eth at can you look on public.com yeah i'm pulling it up um i'm i'm sure it's up 11 percent it is down 13 percent so eric we got to get eric trump uh you know pumping eth a little bit harder is clearly um not that's hilarious yeah so the dynamic here is absolutely wild like so much of the

so much of the news around world liberty fi eric trump's project was that they were buying ethereum with size yeah presumably from the pre-sale but it also seemed like potentially proceeds from from trump coin were being sort of reallocated over there so um i'm pulling it up right now uh i'm expecting to see eric saying hodl yep yeah he said it so he said um on uh february 25th he said buy the dips and then today he says uh somebody said never fade eric trump and today he says you're welcome my friend hopefully i made someone's life just a little bit better now my advice hold long term and ethereum is down uh yeah 12 today uh on on uh really really a devastating blow to the ethereum community because you know they've had a they've had a rough go at it.

Becoming a little bit of a punchline. And yeah, this is right after their conference, ETH Denver, which is one of the biggest events of the year for them. So tough go. But, you know. So let's get some more context and then go into the timeline. A one-time Bitcoin skeptic, Trump embraced crypto last year and made a series of big promises to the industry. Since returning to the White House, he has created a working group on digital assets and pardoned Ross Ulbricht, the founder of Silk Road, an online drug bazaar that used Bitcoin as its payment method.

Investors and analysts said that one way to build the reserve is for Uncle Sam to hold on to its stash of Bitcoin seized from cyber criminals and dark net markets. The US government holds more than 180,000 Bitcoin worth about 18 billion based on current market prices. Yeah, see, that would have been enough, right? We could have just had the US crypto reserve be assets that were seized from criminals. Yeah. And it's kind of funny to be like, hey, look, it will effectively be burned.

Like any Bitcoin that is ever seized going forward, because we're probably going to be seizing a lot more. It's a way, you know, because in the past, there's been concern that the government has been sitting over the sell button, you know, going to just market itself. And so it would have been a way to potentially find sort of a through line of saying, you know, we believe the government should have some exposure to cryptocurrencies, but we're not going to be using taxpayer dollars to do that. Yep. But alas, not what ended up happening.

That's great. Well, let's go to some reactions. We got Nick Carter. We wanted to have him on the show, but he's tied up today. He'll probably be coming on later this week. If this is still in the news, if not, we'll get him the next time there's breaking news.

There'll be another headline. I'm sure something will happen. Trump coin number two. Let me retweet this. Repost. There we go. Today feels like a good day to repost my anti-SBR article. That's the Strategic Bitcoin

Reserve. I stand by it, especially in light of the inclusion of ETH, SOL, ADA, and XRP. It's not the job of the government to run an Airsoft's crypto hedge fund. It's not their job to pick winners and losers. The dismay you're seeing at the inclusion of some coins confirms if the government gets interested in crypto, it's not necessarily going to be good for my bags. Most conservatives and libertarians are suspicious of top-down government apportionment of resources in this manner, preferring to let the private sector sort it out. I wasn't a fan of Biden's massive infrastructure spending, which I felt was extremely wasteful. And for that reason, I don't support further inclusion, incursion into the private sector by the government,

especially not via naked dollar issuance. Typically, the US government doesn't really intervene in markets with its monetary tools beyond setting rates. Its role is setting the rules of the road and keeping the system stable, not aggressively deploying government funds into commodities for day trading. And yeah, it is fascinating. This is something that like, I feel like it's so pro-tech. It's like, it really should mark the end of the story of the government being anti-tech, anti-crypto. And now the government's like so pro-crypto. Yeah. But the response from at least our corner of X was, this is not good. Yeah. Yeah. Well, it seems like

the government is generally pro crypto because it makes a certain part of the voter base happy. Yep. The government doesn't seem to be pro crypto and the government acknowledges that it's a legitimate asset class now and we shouldn't as a country attack it because the technology has real potential. And if you create a positive regulatory environment or a fair regulatory environment, it could flourish. And we want that industry to flourish here in the United States. That being said, it does seem to date that the biggest pro crypto moves have not been... The pushback is that there's so many ways that you could argue that they're sort of conflicted moves, right? And yeah, even Sachs was facing a

lot of blowback yesterday on Axe just because he said, you know, he came out and said, I sold, he sold his positions in Solana and Bitcoin, Ethereum, all these different things. But you can easily kind of look through and say, you're a major investor that has positions in a bunch of individual crypto companies like Bitwise is one. And he still has a ton of look through exposure. Yeah, look through exposure, basically. And somebody was pointing out, you know, I think this is later in the timeline, but somebody was pointing out that just how convenient it is that Bitwise's top five position in the Bitwise index are the exact assets that are in, and I'll push, and the reason- I don't think that's a conspiracy at all.

I don't, yeah. So what I would point out there is that they just picked the five biggest tokens by market cap. Yeah, they're all the same. the top five happened to be the ones that the index built, which happens to be the ones. And that makes perfect sense to me. It's like, it's like, if you went, Oh,

we're making a tech index. And it was like Nvidia, Fang, you know, seven. Yeah. And then, and then all of a sudden some,

some Senator owns all, all the mag seven. And then Trump says the mag seven are what we're going to focus on for like chip you know incentives i'd be like yeah that makes sense like hyperscalers are hyperscalers so overall i think that the pushback against sax on specifically bitwise is a little bit misguided yeah i agree uh but uh but overall it's it's hyper politicized right and yeah the other thing is that they very clearly did this via the white house this wasn't something that went through congress and was supposed to be something that had sort of broad buy in from Washington. Also, to be to be fair, did this isn't they haven't done anything.

Yeah. They've just announced a plan to do something. They were like, Eric's like, Dad, we need a pump. We need a quick pump. Yeah. Yeah. No, no. I don't even think there's a number yet yeah like it could be we're buying a million dollars yeah it could be we're buying a billion it could be we're buying a trillion like these are all wildly different things he's just saying i'm excited about this yeah and the number is going to be hyper hyper analyzed because people are we're also tracking how much does how much waste is catching and so if doge saves you know 500 billion dollars and then

we buy you know anything less than like 500 billion doesn't seem super serious right if they if the government went and bought 100 billion dollars worth of crypto it's like okay cool yeah uh but but uh anyways that's gonna be uh this is gonna be you know continue to be hyper politicized uh as everything is today yeah and. And so, uh, I, I like this analysis from Joe Weisenthal over at Bloomberg kind of breaks down, uh, what it means to build a strategic stockpile. He says, conceptually, it makes sense that, uh, conceptually it makes sense for the government to hold strategic stockpiles of any asset that A, it could presumably have a liability in at some point, and B, it can't instantly acquire with money. So for example, oil, especially when we can't produce much here, made sense. Military equipment is like this as well.

One could argue that in a war, we have bullet denominated liabilities or tank denominated liabilities. And you can't acquire bullets or tanks out of thin air with money due to the time to ramp up production so um and then sayla who we've had on the show before says uh strategic bitcoin reserve makes sense for the same reason a strategic gold reserve makes sense it's a monetary hedge against u.s dollar hegemony a prime export of the u.s other assets don't make much sense, i.e. the U.S. does not have a random basket of precious metals. So I think that's I think that's the right take. I think a lot of people, Max Meyer had some good points along this route. He's like he wants the government to

be focused on making sure the currency of the United States sort of maintains maintains its value, not day trading. But as we've seen, some presidential day traders, you know, sort of maintains, maintains its value, not, uh, day trading. But as we've seen some presidential day traders, you know, uh, uh, the guy from El Salvador, you know, he pulls up, uh, Robin hood or whatever on his phone. Um, if he's smart, he's pulling up public. Um, and, uh, you know, he's just, you know, basically on a mobile device, market buying, market buying Bitcoin, uh, from what, from what I can see. So, um, I mean, we were talking about this before with the Javier Millet stuff and it's like, it's great that, that, that day trading Bitcoin is working for some people and the crazy stuff is working for some of these smaller countries. But like, I, I need to be convinced a little bit

more that this is like, that we are in the same situation as these other countries yeah um let's go with joe walsdale yeah this was this was a good take so joe says taxation is theft it should be kept to a minimum it's wrong to steal my money for grift on the left it's also wrong to tax me for crypto bro schemes efficient defense courts national parks yeah which he says should fund themselves prison etc fine cut cetera. Fine. Cut it out with these schemes, guys. I thought this was the best take. You didn't see a lot of people that were overly pro-Trump in the election cycle actually coming out and pushing back against this, but this is the right take. I think we never discuss politics on this show, as our audience knows, but it's okay to vote for somebody yet disagree with with you know and agree with some of the stuff they do and disagree with other stuff that they do and if you can't

if you can't manage to do that then you're not sort of thinking independently right you're just sort of and vice versa yeah like you should you should be able to say hey i don't support the guy generally but uh like this is one thing that i like And there are plenty of examples of that, like the moon. Yeah, and so somebody, and he was quote tweeting Mayor Suarez, who says, I turned Miami into the crypto capital of Florida. Now we're turning the US into the crypto capital of the world.

I generally agree that the US should be the crypto capital of the world. Like 100%. But if you actually look at the chart of Miami coin, hopefully our strategic reserve doesn't follow the same path. Also, making America business friendly to a company like Coinbase

that operates a very legitimate crypto exchange and having Bitcoin on the balance sheet of the Fed are two completely separate things. One is like, stop sending Wells notices, have more regulatory oversight, be very clear with Coinbase on what can they list? What can't they list? What's a security? What's not a security? What's a fair launch? All these questions that everyone in the crypto community has, where's the line drawn? And the other is just like are we pumping the Miami coin is the chart won't even show for Miami coin because it's down so horrifically but um it's a good experiment um the the steel man on this is that a lot of times when people say like, oh, the government shouldn't be spending on X, Y, or Z, they always assume that the government spending is going to go to zero. Yeah.

But there is a world where the government buys a bunch of crypto and it 10Xs and they sell it and they make money. And that's actually what happened during the during the the housing bailout like everyone was like why are the bankers getting a bailout like they're wasting my taxpayer money well those loans got repaid back with interest and so it's kind of like a narrative violation and like you might not like it because you didn't punish the people as much as possible because yeah some of the people that were involved in the banks they did get bailed out, but it didn't cost the taxpayer anything. In fact, it made the taxpayer money. So you paid less taxes. It's a disappointing thing here is that if, if somebody was already not a fan of Trump, nothing about the last 24 hours would have changed their mind at all. Right. Like the

dominant narrative on the left was that Trump is a grifter. You know, he's using his the office to just sort of accumulate personal wealth and all this stuff. And now even the people who voted for him are like, yeah, we're saying like, stop it with the crypto grifts. So I posted yesterday a Nathan picture of Nathan for you. Fantastic show. If you need some business advice yeah uh and i said the plan pay off the national debt by cutting government waste and investing the savings into high-risk cryptocurrencies i can't even finish it because it's it's such a such a ridiculous plan what uh we're done but uh well let's go through uh trump's crypto schemes according to how crazy they are yes chronological order nick went ahead and did the heavy lifting here.

He ranked Trump's six crypto projects. And so he starts off Trump NFT, three out of 10 low stakes was kind of cool at the time and started off Ryan Selkis is Mara Lago arc, which I think was kind of an important moment. I have a hilarious story about this. So I know someone who bought this NFT and they said that it was actually one of like the most valuable NFT things you could possibly get because it got you dinner at Mar-a-Lago. Really? Yeah. And the thing

was, is that the people that bought it. But it only gets you that one time right yeah one time which is a kind of a problem for this is the thing so so it's sold to everyone so a lot of the people that bought were just like fans of trump but they weren't like hardcore crypto people yeah so they went and bought it but then in order to actually redeem the dinner and do the nft stuff you actually had to have like a wallet that you could transfer. And it was like somewhat technical. Yeah. And so you take the universe of like Trump supporters who are down to spend a bunch of money, like supporting him and like buying his NFT. And you narrow that down to like 1% of people that are both Trump supporters or like down with him, but also like capable of running the wallet in the way that they need you to do to cash in

the NFT to go to the dinner. And so, uh, I, like the person I know that, that, that in the NFT to go to the dinner. And so the person I know that bought the NFT went and the dinner was empty. And so then he was basically able to just pitch Trump his exact vision for crypto. No way. Yeah. It was like, this is exactly how I... And then Trump was like, wait,

my biggest crypto fans all believe X, Y, and Z. Yeah. When clearly that's not true yeah but it was able to just like yeah i'm surprised that more projects didn't realize that buy it because it sounds it sounds extremely far-fetched that you bought an nft for 500 bucks and you got a dinner with the president and you could talk to him about crypto policy but that was probably the best lobbying dollars you know exactly ever spent and so like yeah like like the expectation was like you get you get a dinner you get to go into a massive ballroom and maybe trump comes around and like shakes your hand instead it's like him and three people yeah

it's like the highest leverage lobbying you could possibly do if you but imagine the combination of things you have to be pro-trump in crypto and also like enough of a dgen to think that buying an nft is a good idea so you can't be like the highbrow crypto person who's like actually like bitcoin is just the only thing i'm a bitcoin purist i would never buy an nft uh but then you also have to be well like it's like all these weird things have to have one thing you have to give trump's crypto team credit for is they always position these things as collectibles, like very clearly. So they were collect Trump cards. Yeah.

They were trading card NFTs. They weren't NFTs, right? And with Trump coin, it was Trump memes. You were just buying a meme. You could buy a million of them if you wanted. You could buy a strategic meme reserve for sure. That's obvious. OK, so continuing through this.

So we have World Liberty Phi, seven out of ten. We got through one. Seven out of ten. Low. Kind of an insane thing to do ahead of the election, which which, you know, this started in. Nick was very against it. He was like, how can we tell them not to do this started as vaporware now an extremely questionable slush fund thing that justin's son owns a lot of bad vibes on this and so they were basically doing a public sort of like equity

financing type thing but you just got tokens or something and now now they just have this you know basically uh hedge fund uh trump coin he says nine out of 10, completely unhinged, just a crazy move overall. Melania coin, he's actually pretty harsh here. He says six out of 10, kind of sad at this point, but it was the beginning of the end for meme coins and introduced us to Kelsier, which was behind the Malay project, which was funny. So there are positives. And then he said crypto reserve featuring Cardano and xrp 10 out of 10 i didn't even know what to say about this a government bailout for your buddy who gets crypto news from tiktok silver lining at least the maxis are upset sad how long this list is so i think to

be honest i think uh nick had the best takes across the board over the last 24 hours. We should get him on tomorrow. Even if it's slow news. So we got another post from Jack Raines over at Slow. He says, this is a great take. And it's a post from David Sachs in 2021 that says, who's now our crypto czar. He says, the problem with government as a capital allocator is that the money goes to special interests who have the ability to lobby but not to innovate. And it has to come from somewhere usually innovators haven't built up influence yet uh so anyways uh and uh good good good one to surface uh sam lesson another crypto um

project guy and gp overt slow says lol. So anyways, tough one. Again, David Sachs, you have to imagine if I had to, if David Sachs could say what he actually thought, I would say that maybe he thinks that there should be a Bitcoin reserve in the same way that there's a gold reserve. I don't think that if he could have made this policy himself that he would have just made it the top five projects by market cap. Yeah, he does. He is in a weird situation. And again, we have no idea how much he's actually shaping policy. Yeah. He is the crypto czar. Yeah.

But what does that really mean? Well, he's also the crypto and AI czar. Yeah. And arguably, AI is probably a lot more important for him to be focused on yeah but to date you know but when anything goes wrong he's gonna take the blame yeah so i remember saturday night trump coin gets launched and i'm thinking i'm thinking to myself it's very possible that sax didn't didn't know this was happening right and now he's in a position where he has to defend, you know, defend the actions and make up some,

you know, he kind of has to say something about it. I don't remember what he actually would have shared, but he's definitely along for the ride. Yeah. He, yeah. I mean,

clearly anytime someone, anytime the government does anything like iffy with crypto, he's going to take like the brunt of the attack. Yeah. Effectively, even if he was not like the brunt of the attack effectively, even if he was not in the room when it happened. But he has been pretty good on comms. Like he very quickly anticipated people are going to think I'm pumping my own bags. Let me make it clear that I did sell all of my personal holdings. I might have some look through exposure, but that's a separate thing. I'm not actively managing any, any positions here.

And most importantly, it's not like I went, I'm not front running this. I'm not like egregiously insider trading this. And like the bar is so low that I think a lot of people look at it and they're like, yeah, okay. Like at least you, at least you're not insider trading aggressively. So Gautier over at Alongside, who we've had on the show before, takes a screenshot of Truth Social. Donald Trump had to add a clarification.

Yeah, what happened here? So basically he came out and initially just said the crypto reserve featuring Solana, Cardano, and XRP. And then he had to follow it up and say, and obviously Bitcoin and Ethereum, as other valuable cryptocurrencies, will be at the heart of the reserve. I also love Bitcoin and Ethereum.

So coming out and just saying the meme coin network, Cardano and XRP are... I know. I do genuinely... I think the team behind Solana is fairly legitimate. I did a whole thing with them. I think they're building cool technology genuinely bitcoin is digital gold solana is payment rails for the greatest casino in history yes and uh with the native sort of like poker chip yeah right like it makes sense and then card and then

cardano and xrp chip is the is like the the immutable instrument. It's like the fundamental unit of value on Solana is the poker chip. But Cardano and XRP are, you know, people were joking like, this is huge for Uber drivers. Yeah, it really is like the fake one, right? Yeah. Anytime somebody that's outside of tech asked me like, oh, what do you think about crypto? They're always like, yeah. I'm like, oh, like blah, blah, blah.

Yeah. Like I have Bitcoin and Cardano. Cardano. And they're like, and the funny thing is, is Cardano and XRP. Yeah. Like one of the reasons that you could make the argument that you should put them in the strategic reserve is they sort of just like generally trade based on Bitcoin too. So like they're all sort of like fluctuating at different rates but um uh overall fantastic and then it's hilarious yeah people

were trying to put sax in the truth zone uh over isaac saul says that's a pretty weak dodge uh david um you know calling out that um the conflict of interest here. And they say, first, Saks' firm, Craft Ventures, has been invested in a startup called Bitwise since 2017. David Saks was a lead investor. Right now, Bitwise is celebrating. So the CEO of Bitwise came out the top five holdings of the Bitwise 10 crypto index fund because the main crypto coins going...

The best way to out yourself is not understanding crypto is to call them crypto coins. That's hilarious. Not ironically. Yeah. Anyways, so the main crypto coins going in the crypto strategic reserve just so happen to match Bitwise's top five crypto holdings.

And the reason for this is that the tokens going in the crypto reserve are just the largest project by market cap. Yeah, except for Binance coin, which didn't make it in. Because that's like the Chinese coin. Yeah, right, right, right. Which makes sense. Anyways, so. So we talked, which didn't make it in. Because that's like the Chinese one. Yeah, right, right, right. Which makes sense. Anyway, so.

So we talked about this. It's not crazy. Also, there's a question about like, you know, yes. So Saks invested through Kraft. I don't know if Saks is stepping back from direct control over Kraft, over the czar ship. He could be. Yeah, that hasn't been obvious.

I doubt he has a board seat. of the czar ship. He could be. Yeah, that hasn't been obvious. But even if he invested bitwise, that doesn't mean that he also invested in the index fund. And yeah, there's like seven layers of conflict here where it doesn't seem like that bad, but also it's not great. But also it's like,

how could you ever find someone credible at all to advise the government on crypto who had never invested in crypto? Like, that's basically impossible, right? Well, yeah. And to be honest, the way... So, Saks is very good at the internet, right? He has one of the biggest podcasts in the world.

He's got a hyper-engaged X-Following. If he was running point on the strategic reserve announcement, it wouldn't have gone out like we're putting cardano xrp and solana in the reserve oh and also we're doing this it would have just been so clearly he's not actually running point on anything or has any impact on sort of the comms around this stuff right that feels very obvious we have another post here from joe he says even prior to today there are a lot of professional people in crypto who have been denigrating coins like XRP and ADA for a long time, and yet they're still here largely riding the same beta

and performing not much differently from Solana and ETH. Why is that? He says, all the big DeFi stuff is on Solana and ETH. Most of the NFTs you hear about are on Solana and ETH. I completely agree. You would intuitively think that Solana and ETH would have built up some gigantic market cap over others like ADA and XRP and yet.

Laura Shin has a take here. Yeah, it's a good point. It's because their total supply is many billions, $45 billion for ADA and $100 billion for XRP. That gives them an inflated market cap even if you limit it to the circulating supply of 36 or 58 billion respectively it's still many many multiples of the circulating supply yeah other side is of the coin is that they benefit from small unit prices someone with a limited crypto allocation can feel like they're buying a lot of coins it's still still doesn't fully explain it. It's ridiculous. But these psychology things are real. I mean, even Warren Buffett has to split shares.

I mean, at a certain point, yeah. I mean, you can't buy Berkshire Hathaway Class A because it's like 250K a share. Well, there was a while where you couldn't buy fractionalized shares very easily too, which was a big factor. But that never was a thing on crypto. We have a post from Fat Man.

He said the whale. So on Saturday night, there. But that never was a thing on crypto. We have a post from Fatman. He said the whale. So on Saturday night, there was a bunch of hubbub on X because all this is happening on chain. This whale comes on and does a 50X long on Ethereum and maybe one of the other positions using only $4 million in capital to create a $200 million position.

As the strategic reserve was announced on Sunday, they went up, I think, about $6 million. It says $5 million here. Coincidentally, perfectly timing Trump's true social pose, confirming the United States crypto reserve. So obviously some insider action here. Who knows who it was, but it's hard to say, right? Because these assets haven't been explicitly sort of designated as securities.

It's sort of a gray area. But at the same time, sort of insider trading collusion is broadly illegal. And you would have to hope that this kind of thing got got cracked down on um because it's you know some serious size being thrown around it's a bad look yeah very very bad luck yeah and for what it's worth uh that guy nate chastain went to prison he's in prison today for doing the same type of activity on on opensea. You remember that? He was the product manager at OpenSea who was involved in the decision-making around what NFTs got featured on the homepage. And so he would just buy them.

They would pop. He would sell them. And he went to jail for that. He went to jail. He's sitting in jail. I think it was at least for a few years. Yeah, I mean, the question of like, is it a security or not, blah, blah, blah.

It's like, there's just something clearly immoral about having an edge on anything that has a financial asset wrapped around it. And so I don't care if it's a monkey picture or a decentralized cryptocurrency or a stock, like you clearly have an edge, you're trading on it, you're stealing money from people. So he's actually out of prison now. He only had to go in for three months and then three years of supervised release uh so they were trying to make an example out of him but overall i think this is enough of a precedent unreasonable yeah enough of a precedent to say whoever was you know trading on insider info ahead of the strategic reserve announcement yeah probably it's kind of crazy too that they got a 2x in 24 hours. They had to put it

less than a 2x, right? I mean, 50x long is pretty crazy. It speaks to the lack of volatility. It's a very low volatility asset, right? I feel like for something as monumental as the government is going to be stockpiling this asset. Like, yeah, you should not need to go so long just to double your money. Like, I feel like a 50x long, like just like an NVIDIA earn, a slight NVIDIA earnings beat is enough to do this. But Ethereum is pretty sticky. Yeah. And then there's a funny post here.

If he was really an insider, he would have longed anything other than ETH and BTC, though. Let's be honest. Because, of course, everything else. else no this is a good response he says uh i don't uh the original poster says i don't know if it was an insider or not but it's possible for an insider to know the tweet is coming but not know the exact contents of the tweet which was again totally good hey this is gonna happen i mean the rumor was i heard the rumor months ago the original way to index the crypto market which is why crypto indexes didn't become super popular. So you could just buy the few biggest coins by market cap and basically have an index. Yeah, it is interesting.

Also, when I see this, I want to know like, okay, yes, $4 million, 50x long. That seems like a lot. But does this type of trade happen every single day? Because in that case, maybe this isn't insider trading. Maybe there's just one random person who's doing this every day. And then something big happens. And then you see it pop. This was out of the ordinary.

It also was funded by a wallet that was associated with phishing. So who knows what's going on there? We can cap it off. We have a post here from Paki who's joining in about an hour. He says, not to get all political, but Cardano. And then another post from Atlas. in about an hour. He says, not to get all political, but Cardano. Crying emojis. And then another post from Atlas. I actually don't understand Cardano that well because wasn't the guy

like one of the co-founders of Ethereum? Like is Cardano not a serious technical project? Because it hasn't been like hacked or anything, right? Like it works. I think Cardano and XRP are two blockchains. I know that they're not taken seriously, but I don't know. They were super early

and they were ICOs that never delivered on from a product perspective or an adoption perspective. The price is really the only thing. It's one of those things like Solana came about, they were like, we're gonna build a really fast blockchain. We're gonna build this amazing developer ecosystem on it.

And then they basically did exactly that. They kind of did it, yeah. And one of the things is- Payment rails for the global casino. Yeah. That's the sound bite. And yeah, overall it makes sense that, you know, in 2022, every other week you'd have a new L1 blockchain and then it was a new L2 blockchain.

And what we're seeing now is that it seems like, you know, developer and investor activity have sort of focused in on Solana. And, you know, it makes sense, right? There's no reason that there there should be you know a hundred different l1s um anyways last post for this one we have from atlas uh at creatine cycle he says american strategic scam and gambling reserve with the uh with the bald eagle i was so inspired by that yeah you were inspired we got it we got it uh immediately ripped i'm gonna pull up john's post he says um you want to read it out say now that we have a strategic crypto gambling reserve the next obvious step is to introduce universal basic parlay every friday uncle sam should send

five dollars to every citizen's draft kings account to give them a little thrill going into the weekend. Fantastic. Obviously I'm very anti-gambling. We got to get that, we got to get that into sexier, you know, that's next. Yeah.

I mean, there's something to it. Just giving someone a little, Hey, there's a chance. It, you know, it's like the government already runs casinos or like the lottery and they give you little stimulus.

The stimulus is giving everyone the same amount of money right um and so this is a version of uh of that but uh instead of giving instead of giving everyone a thousand dollars for the covid checks the trump checks remember that yeah what was it a thousand bucks something like that something like i don't know i don't think i qualify i don't think i got it but uh i i think everyone got like a thousand bucks? Something like that. Something like that. I don't know. I don't think I qualify. I don't think I got it. But I think everyone got like a thousand bucks and then they went and bought sneakers and Bitcoin and GameStop stock. Yeah. Instead of that, cut out the middleman.

Instead of giving everyone the thousand dollars and then they go gamble it. Yeah. Just give them a lottery ticket. Yep. And so everyone gets it and it's like hey we need we have a trillion dollars in stimulus we're gonna make we're gonna give you a thousand billionaires so so every american we know you're suffering there's a one in a million chance that you become a billionaire incredible the american dream the american dream yeah the

american dream um okay we got time we got Keith coming on in 15 minutes. Amazing. We got Packy coming on in 45 minutes, and we got Sheil in an hour. So let's keep moving on. Let's keep talking. We got 15 minutes to run through. You know what's something else that people would take?

Strategic stockpile of? No, yeah, strategic. What's another thing that the U.S. government should be getting a strategic stockpile of? what's yeah strategic what's what's another thing that the u.s government should be getting a strategic stockpile of holy trinity watches and you know i want it i would be more comfortable as a citizen if i knew that uncle sam had a hundred thousand day dates yes yeah yeah like just rolex is for everyone like i would like to know that the the u.s government yeah could at any point decimate the watch market yes by flooding the market yeah and if you really so imagine let's let's say if trump really wanted to build goodwill yeah he would buy up every single

watch yeah on the market and then at the end of his term markets sell them all yeah drop drop the prices and then every american could buy a daytona or a day date right yeah everybody would be walking around uh you know in style i mean you know uh you know fort knox is filled with gold let's take that gold turn it into cartier tanks turn it into presidentials yeah turn it into turn it into you know I don't know what's another good gold watch

a Santos let's take our gold ship it to Cartier and just be yeah we'd like we'd like one million

Cartier gold Cartier Santos Bernard Arnault wants to avoid tariffs yeah let's do a deal use the Fort Knox gold

to make more watches and then give us a cut of the net revenue on the final product we want some of your margin and of course the u.s government should order all of their watches on bezel you can shop to 22 000 luxury watches fully authenticated in-house which would be important authentication team is gonna be busy yeah maybe we should send the bezel authentication team to fort knox they're authenticating gold watches why not how do they authenticate gold bars do the bars too do the bars too yeah are these are these bricks that were spray painted with yellow yes chrome spray paint yeah if they can if they can tell is this watch uh just you know gold plated versus gold have you seen that viral post that's's like, like, uh, Oh, like there's like these fake, uh, jewelry companies that sell on Tik TOK and no one can tell the difference

because they gold plate them instead of making them solid gold. And Ryan Peterson was like, didn't Archimedes figure this out 2000 years ago? Like you literally just have to figure out the density. So you just put it in the tub and look at the wallet, water displacement, and then you weigh it on a scale, which has existed for thousands of years. And everyone on TikTok is like, it's impossible. We can't figure out if it's gold-plated or not without destroying it. It's impossible. It's so funny to me that he's just dunked with the Archimedes thing.

We've actually been able to solve this problem for thousands of years. But misinformation continues to be the problem. Anyway. Misinformation is back. Yeah. Well, we have some real information for you. Real information. Trump and chipmaker TSMC expected to announce $100 billion investment in the US.

It is the latest effort by Trump to persuade companies to make big investments in the US. What do you got, John? It's exciting. I mean, the whole tune and the whole just, I don't know, vibes around the chip ban and how we are playing the semiconductor strategy in the era of AI has changed pretty radically. Like there was definitely a thought in post-ChatGPT, post-Doomers having a serious say and being taken pretty seriously. There was definitely a vibe of like, yeah, like this is going to be a weapon. This is going to be something that's very valuable. We need to corner this resource. This is maybe like nuclear weapons. We should maybe lock it down. We should make sure that it's not just you know being stolen left and right and and and also we should restrict the chips that allow

these models to run at scale uh and then you know flash forward a few years we've done the chip band nvidia was able to restrict the memory bandwidth on the on the the h80 instead of the a1 h a100 they basically created a custom one that complied with the chip bands. China bought a bunch of those. DeepSeek team optimizes, winds up building a frontier model. No, and we've talked about this before. We don't think that NVIDIA has gotten enough sort of flack

for sort of working around the chip band. But at the same time so many major u.s institutions have so much uh such large positions in nvidia yep uh you know there's actually a good you know you brought this up earlier ben thompson has made a good argument for we actually should the the chip ban is probably bad we want china to be dependent on, you know, TSMC chips and not to build their own sort of alternatives to it so that they sort of worry about, you know, invading Taiwan for that reason. And Ben Thompson lives in Taiwan, obviously, doesn't, you know, wants to continue living there. I don't think he would be too welcome after a Chinese invasion, given his long history of critiquing. Yeah. And so China's

rebuilding the TSMC supply chain right now. They have SMIC and SME, which are the TSMC and ASML copycats, but they are potentially a decade behind. It's very hard to tell how close they are to the frontier. I mean, even Intel, AMD are not near the frontier. And American companies have been struggling to catch up, which is why we, you know, both every administration, every tech leader has been like, let's get TSMC to come here. Can't we just, you know, give all those people green cards or gold cards? We didn't even talk about the gold card thing but i think people would happily pay five million per person to bring over the tsmc uh experts and uh yeah the challenge there though is you have taiwanese people who love taiwan of course and have yeah they don't just want to leave their country because there's like slight tensions

between two companies that aren't uh two countries that are just rivals like yeah we're not enemies with china yeah we're just rivals like we're not allies but we're in the world trade organization together we're in the un together like we are not at war sure sure that's a bigger debate but we are not geopolitical experts we're we're we're in like an economic tiff but that's about it and i i don't know no one's killing each other i mean ask the ask the fish off the coast of argentina okay okay uh no but but you know what i what i like about this announcement hopefully it goes through is that this sort of america first investment executive order yeah uh this is the kind of thing that makes that eo real yeah and so 100 billion in chip manufacturing plants over the next four years in a short timeline too yeah it's not a xai

speed but uh you know certainly pretty and there was news that uh that tsmc was making good progress at their arizona plant yep i don't know if it's in this article, but people were very optimistic about it. Yeah, that should give them confidence in making a much larger investment. Yep. To the US, advanced chip packaging is particularly critical for AI-related chips as it enhances performance by integrating multiple semiconductor components,

reducing size, improving power efficiency, and ensuring faster data transfer, key factors for AI applications. The US has supported TSMC's growth through 2022's chips act which earmarked tens of billions of dollars in grants to domestic chip manufacturing and this is the other criticism that ben thompson has always lobbied against the chips act is that it's grants it's hey we'll just give you money to just go try and build these instead of instead of being demand side it's supply side so um much better than what's hey we want to actually strategic reserve like like the u.s is a buyer of these chips at this price if you can domestically manufacture a chip that is competitive

with a nvidia h100 or h800 at uh at scale in america boom we'll buy it we'll build the data center and then we'll be the leaser. And then maybe we'll just sell it immediately. But you know that the demand's there and that's, and that's enough for the free market to go work and figure everything else out as opposed to, Oh, there's this grant that's going out. And so the grant got parceled up. And now, and now all of a sudden you have to do it. Now you can't just do it in America. You have to do it in Arizona because the Arizona guy gave you more of the grant and like, this is the taxes and this is like, all of a sudden it becomes like the government is now managing the

project fully instead of just being like hey we're just a buyer we're just a buyer yeah and so one of the so so going back to one of your earlier points so tsmc the world's largest contract chip maker set down roots in arizona in 2020 when it said it would build a chip factory there for 12 billion dollars its ambitions for the site have expanded rapidly since with two more factories on the same site and a total investment of $65 billion. The company's first factory began mass production late last year. So we'd love to see them make a significant $12 billion investment

and then commit to expanding that site as well as committing additional capital. Hopefully this announcement isn't final yet, but I have to imagine it'll be sort of set in stone later this week. That's great. Yeah, love to see it. And yeah, I mean, the TSMC stuff,

it is somewhat interesting how AI has made everything, it's democratized learning in the sense that it just codes for you. You can also learn pretty much anything, any history. You can just go and talk to it and it's your teacher, except for making the chips that make AI possible. All of that knowledge is just locked away. Yeah, you have to imagine

in these, what do they call them? Like mentor, mentee, artisan. They don't open source any of the papers. So there's nothing to build on. And so deep research, like if you actually ask it how to run an ASML machine and get good yields, it will come up very very short

yeah the uh interesting thing is it seems that the conversations around intel and potentially elon getting involved intel have gone uh silent i haven't heard much uh from that front yeah all the all the airplanes were like circling and we'll see where it goes yeah anyway um let's move on to the moon. Let's talk about the moon. What a shot. The first lunar sunrise captured by a commercial lunar lander. We tried our best to get a flat earther on the show today,

a moon denier. A moon denier. We're squarely in the moon should be a state category here, which is why we're happy to see an American private company is landing on the moon in collaboration with NASA. I really want to know the moon. Yeah. The moon landing denier. Like they have to deny this, too.

And then they have to deny the next one that's going to happen. And then SpaceX. And then Elon. And it's just like. Well, the moon was a bit of a lost art for a while. It was. It was. It was easy to be a denier when it was like, oh, that happened 30 years ago.

It's great footage. Kubrick was involved. And now it's like, OK, we're going to be up there all the time. And so huge, huge news. We have the breakdown here. Blue Ghost, which is a private U.S. spacecraft, landed on the moon. After its successful lunar touchdown, Firefly Aerospace's Blue Ghost mission could soon be joined on the moon by two more commercial spacecraft. And we have two minutes to rip through this before Keith, I think, will be hopping on.

Yeah, we just have to call out that Firefly Aerospace's comms are not where they should be. Oh, good point. The fact that nobody really knew this was kind of happening until they were basically on the moon. Yeah. And Austin's calling out a private company just flew to the moon. I didn't hear about it until now. Yeah, it is hilarious.

Anyone else who would do this would be like, seven days until we land on the moon, five days until we buy merch, here's a documentary about it, here's a video about it. They just went and did it. It's amazing. I mean, which is also cool.

It's cool, yeah. I mean, they were clearly working. It's just rare in deep tech today. What do they call it monk mode monk mode something um they were just doing they were just focused on themselves after 45 after 45 days in space and a pulse pounding semi-autonomous hour-long descent to its landing site at 3 a.m eastern standard time the boxy car-sized spacecraft's foot fourfoot-tipped legs crunched into the surface of Mare Crisium, a vast and ancient impact basin filled with frozen lava on the moon's northeastern near side. This marks the second time the U.S. has soft-landed on the moon since the crewed

Apollo 17 mission of 1972. The first occurred just more than a year ago when another robotic commercial mission the odysseus lander from the company intuitive machines made moonfall lopsided but intact how do we not know about intuitive machines i don't remember that either so space companies please reach out to lulu yeah and get your act together that is so yeah that is so really stuff's just going up there yeah the the fact that uh who knows what we were talking about when when intuitive machines went to the moon but um yeah i want to know more of this maybe it's because it's not launching on spacex it's just not getting enough attention but how did they i think they went uh says, it's a suite of 10 experiments provided by NASA

as part of the space agency's Commercial Lunar Payload Services, CLPS, public-private partnership. So NASA's effort to save costs by enlisting more than a dozen U.S. firms to ferry cargo tied to the U.S. space agency's ambitious Artemis program. I honestly don't know. I honestly do not know how to.

An Elon critic might say that Elon is intentionally sort of dampening. Look, Resilience, also called Hakuto R Mission 2, launched to the moon alongside Blue Ghost on a SpaceX Falcon 9 rocket in mid-January. But unlike other landers, okay. So I'm surprised that Elon wasn't pumping this harder. But he's been busy busy he's been busy he has been busy there's been a lot going on anyway um one of these inward looking instruments dubbed lister is a drill capable of reaching a record setting three meters beneath beneath the lunar

surface to measure heat flowing up from within deep enough to give scientists a better idea of how exactly the moon cooled from a ball of molten rock to the cold inert world we know today. Another called the Lunar Magnetoteluric Sounder LMS will place electrodes across a roughly 700 square meter swath of terrain. Its measurements of subtle electric and magnetic currents coursing through the moon can probe more than 1,000 kilometers into the interior, two-thirds of the way to the lunar center. That's crazy.

Wow. We got Keith in the waiting room. Oh, yeah. That's perfect. You have to imagine Blue Ghost was running on ramp to, you know, make it to the moon. Undoubtedly. You can't you can't get to the moon if you're taking 45 days to close your books every month. It's impossible. What do you think, Keith? Is it possible? The future is on ramp. So all the companies that want to create the future, hopefully are saving time and money off the ramp.

Yes, yes. I love it. Can you give us the update? What's going on with ramp? They seem to be on a tear. Valuation's never been higher. Actually, I would push back and say, take a victory lap.

I know the job's not done. Eric has been very clear about that, but I feel like you can take a little bit of a victory lap and probably more this year to come, given the momentum. Well, the amazing thing about Ramp is the value proposition has been clear from the beginning. We're going to save you time. We're going to save you money.

And now there's empirical evidence across any type of company. We can show that 5% this, 10% that. So it's very obvious. And the CFO world is one of the most archaic worlds. Parts of any business, even the most cutting edge organizations, typically have a very archaic, call it analog CFO function. And Ramp has the vision of we're going to digitalize and bring the CFO function and all the finance into the modern age and use the same tools, same techniques, same data, same software, same SaaS tools that everybody else in your organization uses. And that's why it's such an exciting vision. Like the valuation, you know, is somewhat art, not science. But the reason why investors all across the globe are ecstatic about, you know, investing

in RAMP at any point is because we have this vision of changing and transforming the CFO suite. And every company has this broken engine, has an old engine from the 1800s or 1900s. And we're going to bring the engine of finance into the 22nd century, first to 21st century. AI will probably bring us into the 22nd century with RAMP2. So that's why everybody's excited.

The thing that's special about the company, though, in the short term is usually at this level of scale, companies slow down. The product velocity slows down. The quality of talent decreases. We have a reversion to the mean, so to speak. And rather than anything, it's firing up all cylinders. The product velocity is increasing. The quality and insights of the product and the team are improving. The intern classes for the last two years are by far the best intern classes anywhere in the globe. So that's the future. And so that's why this round is very

exciting because it's a prediction for the future based upon a lot of savvy people who get access to all the best companies that RAM still has the highest slope, which is a play on their metaphor. Do you think that's because Eric and Kareem are second-time founders? Can you break them down as founders? What makes them able to stay on the just insane cadence going into year six, going into year 10? How do they have so much energy? Great question. I wish I knew the answer because I would love to invest in more. If you can come up with a formula or predict a formula that's great but having worked with them

now for over five years i think there's a couple ingredients one subtle ingredient is eric has amazing marketing instincts and you really can't train us the best ceos or the chief marketing officer for the company and you know eric entered originally a space that was, quote unquote, crowded. There were large incumbents, there were other funded startups, and we were able to cut through the clutter immediately. And he deserves the credit for being able to clarify succinctly, powerfully, and communicate the value proposition of RAMP, and then reinvent that every year or two to make it broader, more relevant, more, more impressive actually Korean, you know, is definitely setting the engineering,

both tempo and quality of art and has been from the beginning. And I think the combination is really interesting. And, you know, maybe a global point is if you look at some of the other heroic companies and in people's portfolios, let's say Stripe, you have two brothers. So you're getting two executives for one. I think, you know you have two brothers um so you're getting two executives for one i think you know ramp there's like you're getting two ceos for one and so i think that other amazing companies that incredible synergy between two incredibly talented people where you're always on the same page and you really reinforce each other is very rare and so

if i can find two other founders that are that much in sync, that might be the reason to invest actually. Yeah. What are you seeing for like young Gen Z founders? Like what, what, like there's this narrative like, oh, Gen Z hasn't produced their Zuck yet. Like what's your, what's your take on that? And, and what would be some advice for, you know, the younger entrepreneurs who are coming in, maybe deciding between like, Hey, I build a chat GPT wrapper, make some money. Maybe it's not a VC backable company, but it gets me paid versus let me take a big shot at something massive. Like how do you counsel people these days? I don't think there's a formula that works for building an iconic company.

Like, as you pointed out, Zuckerberg is his first company. Eric and Cream did build a company, did sell a company. So I don't think there's a one size fits all formula. I think it really comes down to, do you have a vision of what the world needs? And do you have a strategic advantage in your own traits, your own personal superpowers that maps to that problem set? And if you have one when you're 19 years old or 20 years old or 21 years old, it might be a really good idea to proceed. If you don't have that combination of a vision and your own superpowers, then learning, building, working with other talented people might be a really good formula. For those of you who are sports fans, there's this epic debate constantly in football about

you draft a rookie quarterback in the first round. Do you start that quarterback and do they learn, you know, trial by fire? Or do you sort of sit them on the bench for a year or two, have them carry the clipboard around

and occasionally, you know, enter a game that's, you know, over, so to speak. And I've studied this actually empirically and it's really interesting that there are Hall of Fame quarterbacks of both sort of backgrounds, career progressions. The career progressions of those who start right away, typically the first season, the performance of the quarterback is miserable. It's the worst year of their career, almost without fail.

Interception to touchdown ratio as a specific illustration. The people who sit on the bench though for two or three years and put aside the opportunity costs there, when they start, they don't have an upside down intercept to touchdown ratio. So they do learn things. And so it depends upon the quality of the team. Anyway, I think it's most useful most of the time for founders to work in an outstanding organization for a year or two before starting their own company, you get a feel for a taste, taste of what great is like, what excellent really excellence really means. Excellence, quality, excellence in driving an organization forward. And I think there isn't, there isn't a great substitute for that,

but if you're really ready to go, there are people who learn better by being told, you know, I'm throwing in the pool learn to swim i love it yeah the question i have is you know you obviously noted earlier that ramp was a already a pretty competitive category people thought that it was not you know a lot of people had made a bet and and were kind of ready to just watch the category play out do you see categories today that are like FinTech in 2020 when you made the, what I believe was your first time investing in Ramp that are ripe for a team to come in and take this sort of new approach, kind of potentially invert the value prop in the way that Ramp did? Have you identified anything there? Is there kind of

categories that you would like to invest in? Well, I was fortunate. It was in 2019. I had a fair amount of expertise in the space. And I'd come to the conclusion that there's massive opportunity in replacing Amazon Business Card, let alone this bigger vision of digitalizing the CFO's world. But the people that were funding other operations, those founders and teams were missing some key ingredients and were kind of naive about some stuff, underwriting specifically, but there's other points. So actually unusual for me, I was proactively trying to find high quality founders that were interested in this problem set. And then Dele, unfortunately, intercepted Green playing a video game, having listened to me, probably

annoyed by me pontificating every day that we need to find like people to you know kind of compete with Brax or Amex and all the divvy and all that stuff and then he's like he actually walked in my office I was in shock he said like I found I think I found two founders I was like really but he turns out he did we had actually been like pitching other founders and trying to recruit people to do this. So I don't usually do this, but I have a lot of expertise in the area. So I'm not usually proactive about trying to find investment opportunities. And then similarly, you know, when I was working at Founders Fund at the time, it was a very nonstandard Founders Fund investment in many,

many ways. The most acute one being, if you have all these competitors that are doing well, what's the monopoly story? There is a monopoly story. I believe Ramp will be a monopoly, but imagine pitching the investment team at Founders Fund, the monopoly story in 2019 in a category that includes Amex.

Actually, SVB even had a product in the market. Brax and DV, very well-funded with, quote-unquote, traction. So it took a little bit of massaging. Fortunately, Brian Singerman also saw the potential at the time and really was alienated by some of the other founders too. So that helped correct the anti-monopoly kind of state. That's great.

Are there any categories that you're looking for right now? Hunting for founders? Well, I mean, obviously everybody talks about AI all the time. And I think there are opportunities in AI that probably fit that characteristic where people have assumed there's a winner or winners or, you know, whether an application layer or foundational model layer or somewhere else, infrastructure layer. But perhaps the right founders, it's now five, 10 years into that story. And sometimes it takes a lot of time to bake before you get the next generation of founders who have insights into what could be reinvented.

The other thing about this is kind of what SpaceX did in some ways with rockets. It was like, the rockets were really good, but they were invented in the 1960s in the United States. And I waited about 20 years, maybe 30 years, to reinvent rockets. And then Rocket Lab, which has a very competitive offering for certain kinds of payloads, was another 20 years post-SpaceX. So sometimes you just have to let the wave sort of go on for a while before you have a vision about how to reinvent it.

And then it's the right founder. So I would love to invest in something that's a next generation replacement for LLMs, not a better LLM, but something that transforms a pretty good double tundra, but something that would be a complete, it would make LLMs obsolete. That would be a cool investment.

Yeah. Yeah, how durable do you think the AI revenue is today? You obviously were around for the dot-com era and companies going public with little to no revenue, 5 million in revenue going public, right? The counterpoint today is that we have great private companies with nine-figure run rates that are growing tremendously fast. But we've talked about this on the show before, this idea of easy come, easy go, right? So if you can create a bunch of traction really quickly, how durable is that? Do you think that the companies

that are adding $10 million of ARR every month are, you know, sort of durable yet? Are they going to be leaders in five years? What's your take there? Well, there's a quality of revenue, and it's different. Like, for example, OpenAI, most of their revenue comes from chat TPT subscriptions. That's pretty durable. Yeah. Consumers are people using it, you know, for business applications, but on an individual basis. There are revenues you can get that are more like pilots. Yeah. And, you can get that are more like pilots. And those are completely non-durable. And then there's somewhere between,

like if you sell to an enterprise and they roll out to the entire organization, this AI-based product, the chance that they're going to swap in any short term is very, very low. So if you get through IT, you get through procurement, you have a champion and you change business processes within a very large Fortune 1000 organization. That's pretty damn, you know, scalable, durable revenue sustainably for probably five plus years.

And so those kind of companies, those AI companies are in pretty damn good shape, in my opinion. But you do see people adopting something that's kind of like a trial like you know my board told me there's this ai wave i need to test out this this and this and have an answer to my board that revenue is very precarious another set of revenues is around training and post-training i think the advances in ai are so fast that the way we build models today with fine tuning and different kinds of training may be also obsolete a year, two years from now. So there may be models that are built that don't require any human training. So revenues that are built on and companies that are built on that kind of revenue may not be as durable as people think either. Yeah. While we have you here, what's your take on one of the hotter categories in deep tech humanoid robots? Everybody's got to take because I think they rightfully should. But I'm guessing

you have something spicy for us. Well, spicy is that the Chinese are ahead of us and it's very dangerous politically, geopolitically. I think the administration is going to have to take some action there. I think you have large companies like Meta publicly embracing this and their CTO is responsible for this. It's a very top-down initiative. You have a lot of startups refunded several at KV. It's probably the hottest chapter among VCs right now is robotic startup, you know, walks in and it's like, okay, how much money do you want? And the value is going to be hundreds of millions of dollars. So, you know, and then Tesla has had a lot of progress. Like actually, I think some of the

private progress is better than the public stuff. So it's very impressive. So I think the sector will be successful for somebody. I think as a VC right now, it's really hard to invest in a sector given the proliferation of startups, all with high potential, the prices you'd have to invest at. Also the monopoly. It's unclear that there will be monopolies, yet some of these companies are being priced that way.

One of the concerns that I have is I think we need to learn from DGI. We need to understand that they were able to flood the market with products that they were selling for less than it cost them to produce right if you just take apart some of these you know products and you understand the component costs it's actually uh more than what the retail price is and unitree is doing the same thing right now right there you can go on unitree and buy a humanoid and uh you imagine they're pretty happy with how the dgi rollout went and they want to do the same thing again. No, this is why I think geopolitically the Trump administration is going to have to address this.

I think robotics have military applications too. So not only do you have this, like, imagine the data collection potential, but the military applications of a robot that can run 17 miles an hour. So I would be shocked if this administration doesn't figure out a way to ban Chinese robots before it's too late. Yeah, with DGI, there's this idea that you're not too worried about the drone in your closet because it's like zippered in, you know, the box that it came in. And there's the idea that like, okay, like in this doomsday scenario, the drones take off and, you know, become these sort of weaponized devices, but a humanoid who's doing your laundry and then can turn around and, you know, take you out is a, is a totally different story.

So I think that you have a good point there. Also training data. I mean, there's, there's a lot of dangers. And so I think this is a real political issue that needs to be top of mind. Like once we get through TikTok, which will happen sooner rather than later, I think robotics and humanoid robots are a particularly severe threat.

That said, we will need an American competitor one way or the other. The world is going to develop at some point humanoid robots that are effective. It would be better if American competitors are great. Yeah.

But we really need to slow down the Chinese progress, especially if it involves subsidization by the CCP. Yeah. Yeah. One thing that's been interesting is seeing how Uber has been positioning themselves in the context of autonomous driving, right? They're basically, DARS positioned the company to be like a booking.com for autonomous vehicles, giving you an

opportunity to potentially talk your book a little bit. Does Traba, and I don't know if you can speak to this, but does Traba have a position where, you know, today they're using sort of human capital across the sort of network of customers that they have? Is there a world where, you know, I'd be curious if you could speak to sort of long term potential of humanoids through Traba? Well, I think not immediately. I think if you look at the tasks in light industrial warehouses where TRABA specializes, a lot of those tasks are not yet ready for robotic intervention. However- But 10 years from now.

If TRABA is succeeding in running the most sensitive part of a light industrial operation is the human labor and your action, quality running, you know, the most sensitive part of a light industrial operation is the human labor and your action, quality control, reliability, all of those things. If you get the credibility of making a business more successful, you may be a great pathway to introduce more and more technology. So you may not obviate humans. You may supplement humans. You may introduce a combination that does some humans and some robotics,

but some company from afar that doesn't understand how a warehouse works, that doesn't understand real workers and what real workers' needs are, and tries to run a mixed system without having any understanding of real people, I don't think it's going to be very successful. And I don't think we're ready to rip out, in the long-tail fragmented sense, light industrial, that the investment required for ready to rip out, in the long tail fragmented sense, light industrial, that the investment required for robotics to rip out all the humans isn't going to be economically feasible. Amazon may be able to justify the R&D plus the fixed cost.

No, and we had Ryan Peterson on the show last week talking about how the bar to clear if you want to replace humans is so high, because we're actually, we're pretty good at what we do, right? We've got, you know, all this, you know, ability to an agency. And it's, you know, very clearly going to be the same type of situation within warehouses as in ports. But over 20 years, I can see Trava introducing more and more technology to their current customer base. Like say, you know, look, look, we've already satisfied you. We're delighting you. Trust us. This is going to make you more efficient, more competitive, more scalable, et cetera. And so that could be a long-term strategy that makes tons of sense for the company and for their customer base. Yeah. How do you think about the rollout of humanoids specifically around depreciation and the EV space? We've seen massive

depreciation on the consumer side, right? Somebody buys a Model Y, it's worth, you know, 30 grand less a few months later, right? This sort of extreme depreciation. Do you see that as potentially a headwind for the rollout of humanoids where, you know, factories basically say, hey, look, I think your tech has potential, but if I just wait a year, I can get a much better robot for the same price. Well, I don't think anybody really knows the decay curve because what is wear and tear due to these robots? And what functions too? It may be very different.

If you ask robots to do this versus this versus this, but a year, are they completely dysfunctional? Imagine a simplified metaphor. If you have weights like a gym at home probably last for a decade easily like your squat rack and your waist you throw up in a commercial gym those things are going to show wear and tear in the first year especially you and barry you and barry you they got to change the treadmill out every day after you at barry i'm sure literally like the wear so it does depend upon the use you use and i don't think anybody knows really what that curve looks like. And then that affects the economics.

Like how prudent, just on a purely rational basis, is using a robot to do X, Y, or Z. Because you don't really understand that trade right now. The only way to really do that is you have to throw some robots at some problems. And then monitor what breaks why. And how. And how fast. And how expensive are the replacement parts. Yeah. Totally. What about the strategic bitcoin reserve do you have a take uh prepared for that yet yeah i'm probably not the biggest fan i mean i'm very supportive of the trump administration i think

almost everything they've done has been really good and really strong and i've been very impressed i probably if i was going to do it, would have done it Bitcoin only. I don't think we need to do it. But if we're going to do it, I don't think. We kind of stepped in the middle of a bunch of messaging problems by including a bunch of other cryptocurrencies. But I'm not the biggest fan of the government performing business functions, period. So I don't like the sovereign wealth fund either. I mean, I'm happy to manage it if they need, you know, KB wants some, if they want to meet

KB, if they need professional managers, we'll probably do it. But the reality is I don't think mixing business function and politics is a good idea. I think you should separate those. And you know, free enterprise works really well. Capitalism works extremely well. And the government should do, you know, protect the American people, defend, defend the border, you know, et cetera. And I don't I don't see any, you know, the only argument for the Bitcoin strategic reserve is obviously we do have gold reserves. Yep.

You know, and if you believe the metaphor that the future of store value is like gold, you can talk yourself into it. I don't think it's the most compelling thing. You know, there was a good point in the administration, like the strategic reserve could just be Bitcoin we seize from criminals, right? And it just goes into fund. Well, actually, we still trust them for that too. Yeah, I mean, obviously the FBI and other people, Treasury winds up getting their hands on a lot of valuable assets. And that could be a good way to fund it without taking American tax dollars. You know, I think the burden, and I think Doge is showing this, you know, is really

setting a great example here, is the burden for taking a dollar from an American family should be increased by an order of magnitude. The justification should go up. Not that there's never a justification, but we need to raise that bar. The dollar belongs to the people who earned it, barring the most extraordinary justification for it. You can't have these frivolous soft justifications or low ROI justifications. It really belongs to the people who create the value. Interesting. Well said. You're spending more time in DC. Do you think that there's a potential for startups or specifically defense

tech startups to move offices there earlier or like actually like build companies there? I don't know. I think for non-defense startups, I would recommend starting an early stage company in DC. Obviously the people who are already successful are spending more time in DC, which is valuable to me to some extent. But I think if you're an early stage company

that's not really targeting the government as your first customer federal, you know, in some way then i think it's probably a mistake right now that could change in five or ten years and you know maybe there's a better ecosystem there yeah i don't know the defense landscape and how fast the defense department's going to innovate um we'll see i mean there are people in the administration who believe that reform is going to be fast and furious in the defense department and that we need it from a budget perspective. We have to, the defense department needs to do more with less. And so,

but until the proof's in the pudding, I don't know how vast the opportunity is right now. We have time for maybe one more question. I'm curious to get your take on Sundar. Do you think he's still got a job in a year from now? The rollout of AI across the Google ecosystem has been atrocious from my view. And I think consumers feel this. John always jokes. He's like, I pay for Gemini. I don't know where to find it. But it's cool when it pops up.

He seems to be underperforming dramatically in the context of Satya. What's your take on that that whole situation well it seems to be outperforming tim cook which you've read yeah at least they have models that are good yeah for those that missed it apple just said we're delaying our siri two years two years something like that as other people have pointed out two years in an ai world is an eternity you might as well say something for 20 years or you know it's like crazy at this point and so i think that's a serious problem and i'm an apple fanboy forever you know have forever so i think it's pretty devastating that they're so far behind

i think sundar made several miscalculations and i actually do think that microsoft and you know sachi got a lot of credit but i think they're seeing some of the downsides to some of their strategies now. Like, I think they are going to wind up not having quite as much of a strategic like lock on AI as they thought they were. I think that said, they maybe played the cards the best they could. You know, you can't always control everything. But I think the world is changing really rapidly and the people who control the future of ai may not be at microsoft yeah that makes sense right well thanks for stopping by pleasure i love having you you're welcome anytime anytime there's breaking news well i'm sure i'll give you a call this is fantastic uh we're gonna

hop on uh keep talking about ramp uh we're going to packy mccormick yeah next so awesome thanks for stopping by keith we'll talk to you soon yeah great to chat have a great day that was great uh good questions geordie i like i like i like keeping the humanoid question going across all of these we got to ask packy that too and then eventually we can put together a super cut yeah here's every every important capital allocator every silicon valley person uh talking about humanoids well while we are waiting two minutes to bring packy in uh let's talk about wander find your happy place let's go i got a hat for this throw it on we got a throw it on uh book a wander with inspiring views hotel grade amenities dreamy beds top tier cleaning and 24 7 concierge service it's a vacation home but better i've been looking at one uh up by

yosemite thinking about taking the kids up there uh big yosemite guy over here yeah it's snowing and we wanted to go to the snow but we didn't want to do crazy hotel we didn't want to do some you know airbnb thing wander was just like the perfect middle ground perfect middle ground and they have this really nice ui feature where if it's snowing at the wander when you're going to be look booking at it it will drizzle snow over the web page while you're on it it's amazing amazing it's a really, really nice touch. While we're buying some time until Packy joins, Packy did an entire deep dive

on Wander. Oh, fantastic. And we got Packy in the waiting room. Let's bring him in. Let's bring him in. I wish he was here in person. He can do the Wander. Oh, I got that ramp pad on. There we go. Hello, brothers.

Hello. Welcome to the show. Good to have you here. Oh, my God. It's great. Hello, brothers. Hello. Welcome to the show. Good to have you here. Oh, my God. It's great to be here. Long time. Long time. First time. First of many.

First of many. First of many. Yeah. Break it down. What happened today? Why are you wearing a ramp hat? Take a victory laugh. Take a victory laugh.

No, I always wear a ramp hat. I love it. I've heard that TVPN is just unbiased journalism. And so I wanted to join you for an unbiased conversation. Exactly. Unbiased. Zero bag holders here. Kind of a fintech space.

Yeah. Guests and hosts of this podcast may hold securities by the presenting sponsor of this show. Anyways, great to have you on, Paki. I wanted to go back to March 21st, 2022, when you, this was like probably your second time covering when they announced their $8.1 billion valuation. Was that the back-to-back round, the double round or whatever? I mean, every single round for a minute there was you basically would you would read a ramp fundraising announcement you'd they were speed running close the information and then they'd you know you get a notification on your phone that said scoop ramp is raising another round uh it was wild yeah that was the eight

point that actually might have been the third piece i think the first time i wrote about them was december 2020 i think they were we didn't talk about evaluation but i think they were valued at 300 million at the time so like something just pathetically like series a at that point yeah that's like a personal kind of net worth type number um and then the next time i wrote about them was when they had raised back to back rounds i think it was like 1 billion and then 1.6 billion so i have it here. And I spent a lot of the time in these pieces, uh, one, just being like, you know, praising ramp obviously.

And then two kind of justifying that, you know, if you're growing this fast, yeah. Like these valuations kind of end up catching up. I think there was a period in between, they took a down round, they took their medicine, uh, in 2023, but now they just kind of continue to grow fast. And we're back way above that $8.1 billion valuation. Yeah. Thinking about the ramp down round was directly tied to the market, not business performance, which is why they're back above that last financing, just given that they were taking that down round while still putting

up ridiculous numbers. And also, I mean, down round is like, I mean, Facebook did a down round at one point. Um, but down round can mean so many different things. And like, I saw some down rounds during that year that were brutal, like pay to pay, pay to play total cram down. Yeah. It's a hundred million dollars on 50 pre. So the new investors are taking two thirds of the company. Yep. And then, yeah, there's a 10% option pool for the executive team or something like that. That's like going to get rolled out. And literally anyone who touched the company for the first half decade that they were running it is just gone, wiped, like didn't exist. Never thing you got paid W2 wages. I hope you, I hope you put some in Nvidia stock because you got nothing now. And I was like, that happened all the time. And it was like terrifying, but you know, it happens. I was on, I was on the other side of

a few of those, but I remember reading about the ramp piece, the ramp down round when it happened. Yeah. And that's when I really knew. I think in 2020, 2021, you can be impressed by a company, but a lot of people are going fast. A lot of valuations are going up. Yeah. a company doing a down round and it's like pretty much gushing and all of the commentary around it and Twitter and everything about them doing a down round was gushing commentary on how, how smart it was for them to kind of just take the hit and keep going. That's when you know, you got a company that's, it's pretty special on your hands. Yeah. So you're talking about ramp

safety. Yeah. So this is John's. So, yeah. So Paki, like obviously like ramps moving really quickly. We're worried about a future where ramp is like closing the book so fasty like obviously like ramps moving really quickly we're worried about a future where ramp is like closing the books so fast that like you go to ask ramp to close the books and it thinks like if we didn't have any humans we would never need to close the book so it just kills everyone yeah ramp ai yeah kind of like a kind of like a ramp doomer scenario like should we pause ramp i've seen some people throwing out open letters maybe trying to lobby the government to slow down ramp what do you think what's your take it's i mean i think it's a real risk i think pausing doesn't work that right then the chinese are going to start yeah yeah you can't do that

the thing that i get worried about is that you run out of atoms in the universe at some point true right if you're an investor and you're thinking like can they continue to double every year yeah like at some point you run out of of atoms in the universe and so that to me is kind of one of the bear cases i guess yeah i think ramp generally is what they're doing is like they're building a machine god that lives in your cfo's chrome tab but ultimately it will be a beneficial benevolent machine god that lives in your cfo's chrome tab focus on saving you time and money and it knows it's lane exactly exactly and so in a post-ramp society kind of like a post-agi post-ramp society i think i think humans will be doing fantastically i i think it'll be great at least the cfo suite will right they're gonna get all their time back that's honestly strategically about the business about

life so i i think uh that that's one of the things, you know, my dad is a CPA. And so like, I just think, you know, when I write about Ramp, I think about my father, right? And like how much, how many basketball games, you know, he could have been out of mind had Ramp existed at the time. I mean, the guy was, you know, he was a business consultant, he was traveling all the time. He'd fly germany for the day and fly back and like imagine you know ram say i just does that for him right and like we're hanging out he knows me better i know him better like it just suddenly gets super dark that's amazing he's like my dad never made it to games in the first 15 no he actually did it was pretty incredible that he would like fly back he

would take the early flight back to make it to my stupid game. So good on him. I just mean, he'd be a lot less tired had ramp existed. I'll give a personal anecdote. I got to hang out with my kids this weekend because we're on ramp. And the books closed themselves. Pivoting a little bit, John and I were talking this morning. There's too many top signals to

count right now uh everywhere you look you got trump coin you got uh cardano going in the reserve you got uh you know only fans competitors doing uh something you know and we got humanoid robot companies with one customer raising it $40 billion. What is BMW's valuation, by the way? Yeah, that's a good question. Oh, my God. It's less than $40 billion. Ford is less.

It's 53 billion euros. 53 billion euros. Okay. So what's that in USD? Like $12? We're mogging the euro these days. It's probably $ billion yeah so so yeah you there's definitely there's definitely a bull case to be made of why figures should be worth as much as their customer um uh their first customer but uh anyways how do you think as an

investor right now we're we're clearly living through one of the greatest times in history right we just had a private spacecraft land on the moon. Elon's launching rockets every day. There's austerity in the government, which is potentially bearish for GDP short term, but probably good for the dollar long term. How do you think as an investor and even a writer and somebody who's called a lot of trends early, what do you think the next, talk to us about the next five to 10 years? Oh, the next five to 10 years. You know what I found

really fascinating is that a lot of the stuff that I'm not investing in has been super overvalued. And then a lot of the stuff that I've been investing in has been undervalued and underappreciated. And I think it's going to be worth a lot more in the next year or two. So that's kind of my take. I'm not a figure investor, a big fan of theirated. And I think it's going to be worth like a lot more in the next kind of year or two. So that that's kind of my take. I, you know, I'm not a figure investor, a big fan of their videos. And actually my daughter loves figure videos and was like really excited to see two of them, two of them together. I don't know. I mean, I think like there's a lot of probably overhyping AI. There's probably going to be like a couple of $10 trillion AI companies that are going to pay for the whole thing. Humanoids scare the hell out of me as an investor, because it's like this really impossibly hard thing to do with a lot

of really, really smart people working on it, where like, if you pull off this impossible thing, then you're competing against these 10 other companies and like who wins a big consumer surplus event. But there's, you know, like human labor doing things. There are some people I've heard who don't just kind of podcast and write, who like, do you like, you make cars or whatever, physical labor. I think like, you know, human, human salary and wages and all of that, it's like $45 trillion. It's like half of the world's GDP. And so like, if you underwrite robots is like some small percentage. I mean, I think figure already got like 0.1% of that GDP got credit for 0.1% of that GDP, got credit for 0.1% of that GDP, which is pretty, pretty amazing. But like there will be like massive, massive,

massive companies built here. And I think there's also going to be a lot of people who lose a lot of money. We could talk about what's happening in, in venture. I think it's like a really, I think like the big funds are actually super well positioned and all there's going to be a lot of these like emerging ish funds who try to compete who i just think it kind of like wiped out i don't know i think there's gonna be do you have a take on general catalyst going public that's a good one i don't have a good take on that i mean it's like it's a really i would say like one of the you know when i think back of some of your one of my favorite pieces of yours over the year i'm not going to know the title, but you had a really great deep dive on this idea that as our tools become better and more efficient, a company that would have taken 100 people to build five years ago now only takes 20, right? And I think we're really seeing that right now in AI, where you have companies like Cursor, a big one, you know, with 20 people doing 100 million of ARR.

It's been amazing to see that play out how, you know, how, you know, take basically one, take a victory lap there, maybe double click in and share some more insight. But I feel like that was really, you basically called that and did it in a very eloquent way. But I think we're, I expected it to be something like, maybe like five years from now that would be the case, but it feels like it's that way like today. So there's a few different ways that goes. And it's really like, there's the Russell conjugation

where like, you know, the person who's doing something different than you is doing it bad you're doing it right whatever and like i literally think about this a bunch when i see all the charts of uh of these companies making like more money than ramp faster i'm like that's actually like way too fast and that's totally understandable ramp however is like actually going perfectly but i think that really actually goes through my head doing it just right but they're they're not and i think i'm actually responsible for like yeah yeah yeah the bigger the bigger growth rates scare me it's okay your growth rate is perfect growing faster is unsustainable right and i like actually disaster

you're growing the perfect right the goldilocks effect the goldilocks growth rate i mean that's you know that's eric and kareem just doing what they do i think it's just like really nailing that that's hilarious but i do think that's just really nailing that. That's hilarious. But I do think there is something about that that really actually does scare me, that fast growth and just how easy it's become. So really you can build more with fewer

people. It took to me kind of two different things. One, it just made me scared. This was back in 2022. Really scared about software in general because you can go out and build with five people, a company that grows really, really fast. And this was like back in 2022, like really scared about software in general, because you can go out and build with five people, a company that grows really, really fast. And two, I think the other point of that essay was because we have better tools and because you can do more with fewer people, startups should be able to just like actually start fresh and compete with

these companies that you never thought that you'd be able to compete with. I'm writing a follow-up on Primer right now, which is taking on K through 12 education, taking on public schools. Not a group of incumbents that you thought you'd ever be able to take on. And I think they actually can. You can put education on a Moore's law cost curve and make education better for less and less money. And so like, that's pretty amazing. Obviously, Anderle, you know, is like starting to get starting to approach kind of primes valuation. And so like that, I think is like the really exciting part of it to me less that five people can build things really, really quickly and more that 100 people can build things to take on like these really old big companies. Yeah. What's your AI stack? You've been a little bit critical of AI's writing ability, which I think is fair. We also, we, we have Coogan's benchmark, which we do about once a week where we get the

latest model to try to tell us a joke. And it's pretty, it's hilarious when you read it, like you're a standup and it just bombs intentionally. And it's funny to watch someone bomb intentionally. So it's good in that regard but how have you been uh yeah what's your what's your ai stack and uh what's actually useful uh i mean i still use claude and chachi pt and grock to just kind of like if i don't understand something yeah throw it in or like to make sure that i like i have explained something the right way or to get feedback on an essay basically four point what's that like you're using it like a better google search or like better wikipedia a better google search and like just a little safety blanket on

the like i don't have an editor so somebody to like tell me that this isn't like the the worst thing i've ever written um 4.5 is actually a little bit better it stopped doing like the thing that killed me that i've tweeted about a couple times recently is like the m dash it's not just blank m dash it's like a totally different blank and 4.5 has actually stopped doing that which is really good because i would see that in people's writing and it's just like it really made me hurt but yeah uh what was the pg one uh delve delve but you know what's funny i i when i read older stuff that's like that totally predates i find delve in it all the time i think pg might have been wrong on that people oh really interesting yeah yeah i i thought there was some some some weird round tripping thing where

like like the rlhf team in kenya that open ai was paying to do the rLHF stuff had learned English in a very proper way. And so Delve was one of the words that was like in the vocab course that they all took. And so they thought that it was like a much more popular phrase than Americans think. And Americans use it, but just not all the time. So it's kind of weird. But I mean, you'd see these aberrations all the time where you'd be like, write a tweet and it would like use hashtags. And it's like, that's kind of what a tweet is, but not really. Not today. It's not a banger.

Like no one uses hashtags. Or if you do use a hashtag, it's like in this funny, like kind of meta ironic way. It's not just like, yeah. So yeah, yeah. Give me some other hot takes. I mean, I literally just asked it today because I was trying to make my own joke for this podcast. The joke that ended up becoming the fact that we're this unbiased conversation about ramp. There's like that one phrase, like no bias, no something.

No conflict, no interest. No mercy, no malice. No conflict, no interest. That's what I was looking for. See, this is, so I said that. I said, no bias, no dot, dot, dot. And it was like very confidently no bias no bet what you're thinking of i was like no the phrase you're likely thinking of is

no skin in the game no opinion yeah yeah and jordy got it in two seconds uh yeah still got it not a paper clip yet uh what what's going on on Substack these days? They've got some social activity that's happening. It seems to be picking up. You're still writing on Substack, correct? I'm still writing on Substack. I've seen a lot of conversation about people going over to Substack.

You can use links there. It's a friendly conversation. I have not done that at all. My people are on X we're on X live right now. Right. Is this our first live X episode? It is first ever, first ever. Go retweet it right now. Don't get too distracted. Uh, yeah. Um, I don't know, I don't know where you want to take that. I mean, sometimes like as a company seems to be doing very well. Like the last time I saw Chris and I got like some kind of,

I don't know if I should even say, but like, you know, so some reference on like, Oh, I'm like hiring an accountant that worked for them. And they're like, Oh yeah,

it's actually a pretty good business. And so congrats to the team. I think they've, I think they've done really well from a company that was like, kind of like maybe overhyped at one point. It's like, Oh, it's like playing in the social.

It seems like it's, they've, they built a really solid business broken through the cultural norm yep i see it on instagram yep and my question to you is you pay them 10 of your gross revenue right no i don't he doesn't because you don't do because he unlike the podcast run ads this is why he's on the show there we go you gotta run ads i mean he is an ad respecter ad respecter we're both you know ram sponsored obviously wander portfolio company yes longtime friend of the newsletter and just feel good getting to tell people about that if i were

there you go if i were a subscriber business i wouldn't get to tell people about ramp i wouldn't there's not nearly enough ads on the screen right now. We need more. So we got, everyone has a sponsored hat right now. There we go. Jordan got a bezel. I got the wander. You got the ramp. Let's go. I'm going to look down so I can see the logo.

There we go. That's good. There we go. Yeah. So, so, so, I mean, he is kind of a bit of a failure mode for, for Substack. I am. It's funny because people will ask me like, you know, you like, what do you think about Substack?

And like, you've talked to the team, obviously. And like, I actually have never talked to the co-founders. I've talked to one person at Substack once. Wow. Because I'm like the worst possible business for those guys. I haven't paid a dollar to Substack. What do you think about this idea that like, they should be doing the bundling and aggregation on their side,

where like, you should go to Substack, somebody should pay $20 a month, and they should get, you know, like you and pirate wires and, you know, Barry Weiss's free press, like all instead of, instead of those folks like leaving and you monetizing elsewhere, like, do you think that makes sense? Or is that just like a crazy idea? No, it's a good idea. I mean, it's like, it's the idea that everybody I think has that they should do that, that they should build an ad network that like, there's all these things that are like clearly good for good for business. Um, that actually, I think in practice, like when

you're, when you're like dealing with people who have kind of like egos and think that their own thing is like the thing is important, really, really, really hard to pull off in practice. Like I wouldn't want to be part of a bundle. Um, and so I think that that ends up being a challenge. Same with, uh, you know, likeamp is not going through an ad network and buying like remnant slots, right? They're partnering with, you know, just top shelf kind of shows and specific people. And so I think the ad network stuff falls apart there. I really like what Substack is doing for the simplicity. Like I, in the beginning was definitely somebody who thought that I would move to a different platform.

I wanted more customization, whatever. You'd have to pay me a lot of money to move to a different platform now just because it works really really well the core product that they they built yeah have you ever experimented with a like a paid offshoot because i know you've done other offshoots like uh what was the thursday white pill one we do the friday yeah the weekly dose of optimism yeah yeah weekly dose of optimism which is kind of like oh yeah yeah offshoot but but that's still free right it's all still all still free we could i don't want to write more if anything i want to write less this year uh and so uh i think i don't want to bangers only limit bangers only i don't want to limit what i send exactly uh and i actually

don't know i like at this point i'm in too deep and i don't know what the conversion rate would be and maybe it would be incredibly embarrassing and And so I'm just going to stick with what I got. There you go. Love it. Where you mentioned earlier you've been finding companies you feel are undervalued, you obviously have an insane top of funnel, right? You're broken through the mainstream. If I ask somebody that is on X, they know who you are. If I ask somebody that's kind of even LinkedIn mode, they usually know who you are, i ask somebody that's kind of even linkedin mode like

they usually know who you are right so the top yeah the top of funnel must be crazy um but uh what like where where are you excited to be investing right now um i'm sure you're flooded and and doing a bunch of ai but at the same time uh it feels like an interesting time right now where you maybe wouldn't want to invest in the next humanoid robotic you know company you probably don't want to be investing in more defense like net new defense tech companies that are just incorporating today what what's got you know space feels uh like in many ways there's more opportunity than ever because the cost to get up there is dropped but where where is exciting to you what's the weird stuff you're looking at yeah um really like the way that i've been thinking like my catchphrase on this is andrew

and spacex for everything so as opposed to like you see andrew and spacex the move is not like go do the second best version of that it's go find that in the other industry so you know like a base power company or somos internet doing telco or a primer doing education, like find the thing that is going to go win that category is really what I'm looking for. And those end up looking weird. So I was kidding about the stuff that I'm investing in being undervalued, but, uh, I do think that because it doesn't really, really fit a thesis that a fund would have on defense or whatever. Um, it is a little more affordable than a humanoid company or a foundation model company for sure yeah yeah i mean stuff in like power energy deeper in the supply chain way far away from the core

hot ai consumer stuff there's going to be more reasonable prices there also are you looking at bio stuff yet or bio adjacent oh we've been doing a lot of bio stuff i imagine i think yeah hot take would be cancer is probably gone in 10 years i think it's one of my favorite hot takes there's just so many different attacks on it and car t cell therapies are doing well and it's a matter of kind of scaling scaling those out yeah i'm sure you read malabar is the the power law uh i'm sure you've read sebastian malabar is the power law and And before that, he wrote that book on more money than God about hedge funds. And so his whole thing is like, go and find the group of people that are making trillions of dollars effectively, or like really moving capitalist markets, like the biggest power

players, and then write the definitive history and profile of them. And so I went to a speaker series with him. And afterwards, you know, somebody comes up to him, he's like, what's the next book you're writing? Because that's where I want to be investing today right and he said bio he was like i think that the next book i write will be about like the flagship pioneering like but also the biotech public companies and then the biotech funds and so it's something that i've certainly been meaning to get more up to speed on i have a lot of friends and co-founders who have done like i have to say it is hard bio is hard. Totally. Compared to all the other things, you know,

who I've been working with on the bio side, who's, you know, Stanford PhD in genomics. And he, like without him, I wouldn't invest in bio. You see other generalist investors investing in bio and he'll be like,

that is the dumbest fucking deal I've ever seen in my life. Are we allowed to curse on X? Dumbest deal I've ever seen in my life. You are allowed to curse on X, but you will, what would your mother say? And we will shame you for cursing generally, because this is a,

this is a friend. Our kids watch this kid friendly show. Our kids watch the show. Oh my goodness. I'm so sorry. We don't, we don't curse personally, but do whatever,

whatever's right for your brand. Yeah. They're, you know, if you want to have like a low, a low tier, like I, I know you're an Irish guy.

You're, you're, you're, you're up in Boston getting drunk and hammer all Paki, Paki, Paki, Paki,

Paki, Paki, Paki, Paki, Paki, Paki, Paki, Paki,

Paki, Paki, Paki, Paki, Paki, Paki, Paki, Paki,

Paki, Paki, Paki, Paki, Paki, Paki, Paki, Paki,

Paki, Paki, Paki, Paki, Paki, Paki, Paki, Paki,

Paki, Paki, Paki, Paki, Paki, Paki, Paki, Paki,

Paki, Paki, Paki, Paki, Paki, Paki, Paki, Paki,

Paki, Paki, Paki, Paki, Paki, Paki, Paki, Paki,

Paki, Paki, Paki, Paki, Paki, Paki, Paki, Paki,

Paki, Paki, Paki, Paki, Paki, Paki, Paki, Paki, Paki, Paki, Paki, like people get really excited and really like, Oh my God, like they told me that they're going to make people live till 250 years old. They're definitely investing in that and people are going to lose their shirt. But yeah. I mean, at the same time, it's like,

it's like every category is hard until some power law company comes along and makes it look easy. Like Anderle was hard. And now there's like, now there's a new hardware company like every two days. And then they like, yeah, they can't like beat Anderle necessarily overnight,

but they can like sell and get deals and then sell to and roll or like create value or like there can be good deals done in hardware now even though like hardware is hard totally i i mean more just like and me this might just be me calling myself out uh on it what do you have like millions of of people watching this right now calling myself out for being uh stupid but like just the vocabulary of biology and like understanding how the whole thing fits together. It's just like a totally different beast, I think, compared to hardware and other things. Yeah. One of the things I've been sort of realizing around everything deep tech, hard tech, biotech fits this is within software. We went through a 20 year period in Silicon Valley where software entrepreneurs

could go out and make these sort of outlandish claims around the products that they would build, but then just go and do it. Right. Cause the software is hard, but you can kind of make the pixels like, you know, work and whatever it's code. Right. We, we know how to do it. And then in hard tech is very different. You know, Elizabeth Holmes, like I do believe she genuinely believed that she could build the blood testing device that only needed one drop, but then like physics got involved. It was like, I gotta, I gotta tell you to pump the brakes there. Um, so it's been interesting to see that play out where for you as somebody who's a definite optimist, somebody that wants to believe in human potential and the ability to great, uh, build great things. You, you probably have to dial it back at points and say,

like, I want to believe this is real, but I'm not going to invest because I can't kind of reach that conviction threshold. Yeah. I, I have said, and I think this is fair for, for me, not for people who are better at science, but like I do, I'm trying to actually moving closer to the series a now and like not doing deep tech because like, I'm not the guy to underwrite the science. And if I'm like the investor that you're calling to, to, to have something that has a bunch of science risk in it like i shouldn't actually be it's more like the you know the furthest out proven thing and putting a bunch of those together and do a company gentlemen i have to uh i have to leave you last can we can i get a minute yeah you can get a minute okay Okay. As the godfather of Solana, the guy who kicked off

Solana summer, you did, you got to, you got to get credit. Uh, uh, you got to, you deserve some credit for that. Uh, give us your 32nd take on the strategic reserve. It would have been an unimaginable to think that the U S government would be buying Solana, but, uh, you probably, maybe I wouldn't be surprised if you alluded to it. What's your 32nd take. Oh man. My 32nd take is that it's also dumb right now. Like I think Solana is great. I think it's like fast tech. And I think at like some point in five years, a lot of finance is going to run on Solana, on ETH, maybe on SWE or, you know, like a lot of, I think it's inevitable that more and more finance will move over to crypto stable coins and having Stripe behind

it is like a real thing. Any strategic reserve that has Cardano in it is just, it's a joke, right? Like it's like, not to get political, there's a bunch of like, and I'm guilty of this too. There's a bunch of, a bunch of dog that caught the car stuff going on. I think in crypto right now, it's like no regulation, strategic reserve. And we're like, this is actually kind of stupid. Like not this way. Like this is not what we've been yeah bitcoin's down eight percent today and basically round tripped back to where the announcement happened which is so bearish like that's the u.s government is buying crypto and everybody's bearish but i know you have an in-person meeting in like four minutes so sorry for making you late for that no this is great thanks for

coming on you're welcome anytime we'll talk to you soon. Have a good one. See you later, guys. See you. Let's move on to garage mahal. This is important stuff, people. This is really critical. If you're building a garage, how big should it be? Yeah, your neighbors. A couple hundred square feet? No. A couple thousand square feet?

No. We're talking to people that are making 6,000 square foot garages, bigger than most people's houses out in Minnesota. And where are we talking about? Minnesota. Minnesota. I have spent time in Minnesota. The CEO, my co-founder at Rora,'s houses out in Minnesota. And where are we talking about? Minnesota. So I have spent time in Minnesota. The CEO, my co-founder at Rora, Brian, lives in Minnesota.

And you can play. Everything's bigger in Minnesota, right? It's great. The houses are bigger. The basements are bigger. You can play basketball in his basement. He's got a half court. And when it's below freezing for half the year, you got to go big.

You got to build man caves. And we're talking about man caves today. So I'm excited to get into this. So he has a three-car garage in the Minneapolis suburb, already full. He had a three-car garage. Brett Bailey, talk about struggle. I mean, we need a moment of silence for this guy. Because he had to keep his racing Porsche in a trailer outside through brutal Minnesota winters.

Then one March, as he prepared for a race, he discovered the wheels of the trailer had frozen to the ground. Unacceptable, but he didn't just take it lying down. He figured out a solution for two weeks. He was throwing salt out there, but now he is part of a man cave meets storage wars revolution spreading across the country.

I love it. I'm a huge fan of man caves and storage wars. and a racing trailer in a nearly 2,700 square foot space outfitted like a sleek European car dealership. It sports a tequila bar, heated floors, bathroom with a shower, giant TV, leather sofa, stack of racing tires, and a car lift. So you can lift up the car, work on it, wrench on it with a couple of cold ones on the weekend. It's great.

Nothing like getting under your car after you've had a couple of beers. Yeah. Just going to work on it. Going to work on it. It's a little dangerous. It's great. Nothing like getting under your car after you've had a couple of beers. Yeah. Just going to work on it. Going to work on it. It's a little dangerous. This is the American dream. But sometimes you hit that Balmer Peak, right?

Yeah. Working on your car. Call them car barns, barn dominiums, toy sheds, garage mahal's, or shouses for shop houses. They're a big hit in the land of 10,000 lakes. All right. So what's the controversy here john the controversy is that uh they're too big and they make the town look stupid everyone hates how they look uh they called it what was it what they call it they call it the the the tin tin city

or something so i don't you you know this but ben yeah our vice president producer of the show is actually from Minnesota. Yeah. So we might have to send him out there and just have him zoom into the show on the site. Because this is just such an important story. It is. We've got to get original reporting. We don't like to do original reporting here.

We like to just spread misinformation from the timeline. Yes, yes, yes. But we've got to get Ben on the ground there. Yeah. There we go. Ben says he's got friends with garage mahal's. That's fantastic. Yeah, in Cross Lake, a forested vacation mecca two and a half hours north of the Twin Cities.

Space is limited on lakefront lots, making storage space uh, combating an image that has led some to dub this, the community tin city, because there's so much tin, uh, going up as, uh, as, as storage.

Uh, but if you look at some of these photos, they look fantastic. It looks like a lot of fun with your in one, uh, Nelson and others tout the expansion of the tax base from the storage boom, which includes his new 4,200 square foot building, which is like,

that's a massive house. And he's got a taxidermied Kodiak bear. Yes. It's jammed with boats, an RV, sports cars, motorcycles, a taxidermy Kodiak bear,

and his father's model a one section designed with input from his wife includes a full kitchen, flat screen TV, bathroom, and stone fireplace. It looks fantastic. The biggest thing here, John, is I can't go in my backyard and throw up a... I can't do one of these

because California, they don't want you to build. You can do 80Us every once in a while. I know, but I want 5,000 square feet of podcasting. I got to run to the restroom. Can you keep it going? I'll keep it going. Let's jump through to the restroom can you keep it going i'll keep it going um let's jump through to uh the next post we're going to jump into the timeline we got a post from reggie james uh somebody posted do you think that steve jobs did a market survey uh you know did a consumer survey to build the ip iPhone and Reggie jumps in here with a fantastic

point. He says they literally did. They got all the phones on the market. They saw it was all junk by Apple standards and they knew this for a while, but had to get a few technical things in order first. They had to get really good at miniaturization. iPod helped them learn that. Then they had a cross learning moment where the company they acquired for their touchscreen technology, which was working on computer displays, they took that and brought it over to Project Purple. And that is how the multi-touch was born. So now they have multi-touch and know how to make things small. And they're still looking at these junk phones on the market. Once they see what's wrong with them, they ask themselves, what's the phone we'd make for ourselves? They vibed after they

knew the market, they had technical pieces in place, and this is where all the software love that made the iPhone, and the iPhone finally comes together. Pulling from Springboard and all the Mac OSS work, that's what made the iPhone feel so good with directional manipulation and multi-touch. The iPhone wasn't some isolated do-what-you-want want event it was built off of decades of hci learnings a key acquisition in the success and learning to the ipod uh learn the real stories and don't just take a cliche like users don't know what they want as an excuse to build nonsense so shots fired yeah aggressive but completely fair uh analysis the guy who posted this though was like was like hey i'm actually I actually don't know the history

I'm just curious like can you just like educate me but Reggie's a good poster so he kind of amps it up That's let's go. Let's let's talk about this But you know have Reggie, you know Reggie's had some amazing analysis of Apple over the years and their different trends It'd be great to have him on the show sometime soon. We should have him on the show. It's interesting I remember this old core post by Joe Lonsdale talking about the Hegelian dialectic. Are you familiar with this? No.

It's this idea of like, the dialectic is basically like, there's a thesis, antithesis, and then the synthesis. And so you take like the, like an idea, you think about the opposite of that idea, the counter argument, and then you synthes opposite of that idea, the counter argument, and then you synthesize something that takes into the best art, the best pieces of both essentially. Um, and it's a very popular like mental model. And the example that he used in this Quora post

to explain the Hegelian dialectic was literally Steve jobs, um, both being like the vibes guy, but also the spreadsheet guy. And it's so easy in thought leadership and like posting for people to be like oh like vibes are the only thing that matter like you should never think about the market map don't ask don't talk to customers don't exactly exactly people want axioms uh when in fact like like the best leaders are often like you know uh yeah the best generalized advice is to like don't do traditional market research and just talk to as many customers as you can the thing about consumer is consumer is a category where you can have no pre-existing business experience for the category and just build the

product that you want i mean you can do this in b2b as well but i think it's more common yeah to just kind of ignore the market and just build what you want and consumer. But even then it's, it's cool to see the history of how the iPhone came together and not just being, Oh, here's a good idea. We should just do this. Yeah. Anyway, anything else on Apple? I got a lot of hot takes on Apple. You got to be more positive about Apple. I think I just, I've just been positive on Apple for 20 plus years of my life and it's fair to be negative in the short term, but I'm positive in the long run. It's more just like, like, I feel like at the end of your, after you go massively viral for talking trash, uh, there needs to be like, Hey, like we can, I gave Apple an out. I said, if you're just giving up on

innovation by an F1 team. Exactly. Then we'll all shut up. There's something about like, I still love this company and I want it to be great. And there is a sliver of greatness here. Let's just. There's more than a sliver. Oh, yeah.

Way more than a sliver. Totally. But if Tag Heuer will sponsor F1, why not Apple? That would be very cool. An Apple car. And no other sponsors. Yeah. Like Red Bull. I mean, Red Bull has a few others yeah they've got a bunch but you got a bunch imagine just the Apple car going around but I'm sure they can't do it because it's like some emissions thing or something like they've made so many like they've pandered so to so many like special

interest groups essentially like they're like completely bought in at this point yeah I don't know uh it'd be very cool I'd like a I'd like an f1 team do we want to talk about the gc yeah general catalyst is going public you'll be able to uh invest in a venture capital firm soon on public.com uh so get ready move your assets over to public.com uh but no this is a real story uh general catalyst is considering an ipo dan Primack has the scoop. We've been hearing rumors about this for a couple months. And as these asset managers get bigger and bigger, it makes more sense to trade them publicly. There's a few reasons behind that. The main reason in my, I mean, we can list out a few, but when you're a public company, you are subject to

much more aggressive audits. And this is why people don't want to go public because it's a hassle. They will put up with that hassle. And as a result, they will have access to more capital. And there will be potentially more of like a power law consolidation in the actual fundraising of these funds. General Catalyst has, you know, billions and billions under management at this point, tens of billions. And if they want to go for even bigger funds saying, hey, we are publicly traded. All of our financials are public. You can go see them. You know, you don't have to rely on a newcomer scooping some random things to count on it. But there was some debate over this. Dan Premack

posts that General Catalyst is considering an IPO. Jason Calacanis says, what is going public exactly? The returns or the LP interest? Dan Premack says, what do you mean? In this case, it would be the management slash holding company like Carlisle, Blackstone, et cetera. And a lot of people don't necessarily understand this, I guess, but asset managers are themselves businesses that make money from fees and all sorts of different pieces of that. Yeah. And GC, I think, didn't they roll out a private wealth? Yeah. And they have private equity investments. They have growth stage investments, seed stage investments. And so every time they make a deal with someone else's money. And so it will be valued similarly to a bank, although it's a very high-performing bank in the sense.

But when you invest in a bank, when you buy shares in Citi or Chase, JP Morgan or, I don't know, Goldman Sachs. What is happening? Well, Goldman takes money from some people, put my money in the bank, and then they lend that money out, and then they return it, and over time they make money, and it's just like any other business. So I don't know why Jason isn't thinking about this.

Jeremy Gaffon has a good bit on this, which is basically that at the end of the day, private equity is the greatest business model on earth. always says like merchant banks the merchant banks yeah he talks about merchant banks but specifically it makes sense that the the people that invest in private in public in private markets yeah um who study businesses all day long created a business model for themselves that's just absolutely fantastic sure yeah i mean they certainly have like an advantage playing in the question the question is is uh it will be very interesting to see a venture capital firm going out and doing you know a road show and putting together materials and saying look how much ebita we're going to put up in this year and it's based

entire you know presumably entirely based on the fee accumulation from their various funds that are all kind of funneling into this one vehicle. It'll also be very interesting to see what comp looks like post-IPO at these firms. Because instead of carry points, you're looking at stock options potentially. There's a whole variety. Yeah, that's what's unclear is the fund performance,

the carry, where do those returns flow through? Because some of them will flow to the fund performance, the carry, where do those returns flow through? Because some of them will flow to the partners still, but you would imagine that investors in GC and the public markets would want upside in the returns as well. Yep. So the partners own the general partnership, right? So then they would just own shares in the company.

Exactly. And so when you buy them, you're buying a slice of the general partner stake. And if you buy enough, it's like you're a general partner. Right. But you just paid for that instead of worked on it. Um,

and yeah. Uh, and, and, and this, this type of thing has happened before where, um, firms have sold GP stakes and said,

Hey, I'm cashing out of my fund. It doesn't have a lot. I did this, but I'm selling, I don't know if that's actually, I haven't heard that, said, Hey, I'm cashing out of my fund. It doesn't have a lot, but I'm selling, I don't know if that's actually, I haven't heard that, but, um, but basically I'm, I'm selling part of my GP stake. You will, you will be the one to earn the returns from that upfront. But, uh, yeah. So this happened in 2023, January 24th, 2023 thrive capital sells minority stake to Bob Iger and other moguls. So this was

kind of like a party round. They sold 3.3% of the company, uh, including CEO Bob Iger. Um, and, uh, yeah, so they, they were able to raise $175 million to the balance sheet. That's so fascinating too. Yeah. And, and because you think about 3 percent like that could be just like hiring another gp and giving them a slice of the gp right yeah uh you hire another partner you say oh you're going to be the one who does the ai deals or the deep tech deals or the defense deals or whatever and you wind up giving them the effectively the same share but they didn't pay for it or unless they you know bought in for some reason, um, or they, and, and, and they don't get the same alignment. Like at this point, it's kind of like Iger's like a partner almost in the sense of like, if he ha he owns a stake in this one firm. So if he has a deal that he wants to

bring or a partnership, or he wants to do a deal with a portfolio company, like he is linked to thrive in this like very important way. That's more tangible and more economic than just like, oh, I'm an advisor to your fund. It's like, no, I actually invested in your fund, not just as an LP, but also on the GP side, which is fascinating. Anyway, so Shields sums it up. He says GC would be the first major US VC fund to IPO. They own a health system, a wealth business, a fund of funds, a debt business, et cetera. They all started from a $73 million fund, one that had 0.7 IRR. Wow.

Not good. But they kept it going. I mean, you just got to give them credit for that. Yeah, it's amazing. That's incredible. Their first five funds weren't exceptional. I mean, I'm sure if you look at the J curve. But that all changed with Stripes when Hamant led Stripes Series B.

And of course, Hamant Tanaja is the CEO now. And he refers to himself as CEO. He has never, he's never said, I'm sure he said GP. But more recently he's been saying, hey, I'm the CEO of this firm. I'm not just the GP or like the named GP or the most important GP

because all of that's kind of like, you know, fake essentially. Yeah, we should ask Shiel. He's going to be on in 20 minutes. We should ask him. Yeah, for kind of a deeper analysis here and how he thinks all the fees and a huge percent of GC's returns. 5.85 billion came from Livongo,

a chronic care company sold for 18.5 billion in 2020 written down two years later. I wonder what it was written down to. And I wonder, um, and I wonder exactly what, uh, what happened with that? Like what, like why was that asset so mispriced? But this happens all the time. Uh, I mean, plenty of times, uh, companies get, uh, get sold early and then wind up not doing the thing. But then on the other side, you have the instagrams yeah so teledoc was the acquirer they took a 13.7 billion dollar loss in 2022 tied to the

livongo that's a lot that's a lot i wonder what happened i wonder how they mispriced it so bad this is uh maybe on par with with square square's acquisition of a firm or not a firm. Who did Square acquire? Wasn't it Tidal or something? Well, that was... Wasn't that like the music streaming thing? Wasn't Jack Dorsey buying that? They bought Afterpay. Afterpay. Was that not a good deal?

I don't know. I mean, all that stuff blew up when the interest rates were up. They acquired Afterpay for $29 billion. And then like two years later, they were worth maybe $40 billion. Interesting. Public company. Okay. Well, should we zoom in on much smaller deals?

A company making $30K in 24 hours, selling through Google Meet after one viral tweet. Interesting rhyme scheme here. I wonder if that's intentional. Eddie Zoo. Just to clarify on the last bit, and then we'll restart that. one viral tweet interesting rhyme scheme here i wonder if that's intentional eddie zoo wait so just to clarify on the last bit and then we'll restart that so square buys a firm yeah in uh the zerp era for 29 billion and two years later they're worth 26 you mean after pay right not sorry after sorry yeah yeah okay so blocker square yeah buys after pay for 29 billion that's a lot and less than two

years later they're worth 25 billion dollars collectively themselves block is worth 25 collectively i mean they're worth 40 billion dollars now so so they'll build it all back it's one it's just one um figure basically yeah yeah i. I mean, they're just one really good parlay away from getting back to nine-ditch territory. Yeah, we don't see public companies ripping parlays. What's 100 billion? I don't even know. I think that public companies should start ripping parlays

Friday after the market closes. What is your job as a CEO if not a parlay? It's like, I want my CFO to work out. I want this financing to go well. I want that distribution deal to pop. And I'm going to rip parlays. It is a parlay. Well, yeah.

And even you would push back if the CFO's job is automated away by ramp and they have all this free time. They could be ripping parlays. And it would be fun for the market to be able to sort of anticipate, all right, how's the company, you know, the company's putting up a hundred million dollars on DraftKings this weekend.

How's it going to go, right? No, no, no, no, no, no. Don't bet on sports. Bet on yourself. Bet on yourself. But view your organization as if it is a parlay. Yeah.

Because you're going to get this right and we're going to get this right and we're going to get this right and you only have to do that a parlay. Yeah. Because you get this right. And we're going to get this right. And we're going to get this right. And you only have to do that a few times. Exactly. One T Jensen Wong. He's like, I want China to not invade Taiwan.

I want, I want MC America to work America to work. I want, I want Microsoft over 80 billion in CapEx. I want Zuck to develop $20 billion. Secures the 500 billion, 500 billion billion and if he gets that boom 10 trillion stock you gotta post that 10 trillion stock he's like here's my 10 trillion dollar parlay for nvidia it's like it's like the tesla secret plan you know it's like if all these things go right my stock should be worth 10 trillion and so you

know great stuff this is my plan just express it in a parlay i think it's a viral format i think If all these things go right, my stock should be worth 10 trillion. And so, you know. Great stuff. This is my plan. Just express it in a parlay. I think it's a viral format. I think it's good. I like thinking about things in parlays, even though I don't participate them in the sports betting realm because it's low class and vulgar. Anyway, moving on. Eddie says he made $30,000 in 24 hours selling through Google Meet after one viral tweet.

And I like the rhyme scheme there. He says he was inspired by PMF or Die. Yeah, this is amazing. So he made a post on Saturday and he said, I built an algorithm that simulates how thousands of users react to your tweet. So you'll know if it will go viral before you post. It's a really cool concept. Everybody's experienced this. If you post it on X, you think you've got something great. You post it 300 impressions later, you got one like from your absolute boy and you realize like, all right, this wasn't a good post. Sometimes the opposite happens in something that you weren't super confident in, um, rips. But, um, anyways, uh, very cool. He ended up launching this and starting to sell it kind of immediately and

did $30,000 in volume in a day, which annualized is pretty good business. He basically would have gotten out of the cage in an hour. Insane. Oh, I didn't even annualize it. Yeah. That's crazy. Yeah. You got to annualize everything. Don't talk about, you know, you had a good day, say, well, annualized were uh you know 200 million dollar revenue business it's great it's great yeah i saw some big big people quote tweeting this it seemed really fun we should give it a try uh and congrats to eddie i love that uh people have been inspired to go build stuff and and take a crack yeah i saw emmett sheer from yeah that's what it was tick tick tick yeah saying you know something dramatic which basically alluding to if we're

letting truly right now there's a lot of human input you know your brain's basically an algorithm it sort of creates a concept releases it to the algo and then and then humanity sort of reacts and then in a world where algorithms are dictating the sort of entry into the algorithm it's just an entirely new level yeah and so emmett shear Shearer says, tick, tick, tick. And essentially, he says, we're going to start, he's going down the wire heading path.

We're going to be optimizing for the algorithms too much. That's going to lead to some sort of AI doom scenario, essentially. Not full doom. I don't want to mischaracterize what he's saying,

but he's just saying, it's clearly just like things are getting weird which i agree with uh and so yaxin chimes in and says would work better to replace this app with something that just has a blank screen with the text everyone likes you because you know the goal is to get lots of dopamine from the like people basically but that's not really what it is the goal of a social media everyone thinks it's the goal to get like you know a pat on the back and oh people like me i'm popular no the goal is to make money the goal is to make money and and and and that's what a proxy for you know getting a banger post is is that it will get you a job it will sell your product like this kid is making

money and so um it's not about that everyone likes you it's it's you know you cannot replace the app with with with shareholder value with with actual capital trans uh changing so emmet says do you truly not see the oncoming train of consequences for building optimizers that can predict the discourse generated from a post, both volume and tenor. Do you truly not see the oncoming train of consequences for building optimizers that can predict the discourse generated from a post, both volume and tenor? And so I can't. I mean, break it down. I got to dig into it. I mean, I can imagine some consequences from that. I don't break it down. I got to dig into it. I mean,

I can imagine some consequences from that. I don't know about all of the, all of the consequences on this oncoming. I think, I think that, you know, the reality is right now, every active creator online is already hyper fixated on how to,

um, what does the algorithm want? Totally. It's like, mr beast tiktok does this where like if you do this song we're gonna surf you know surface it if you talk about positively about if you uh are against the tiktok ban we're gonna surface it right so people know that they start to lean into it so how is this an oncoming train i i see this is like the train has been whizzing past us and continues to whiz past us and is accelerating. And, you know, I don't see this as some binary moment that Emmett is kind of, I don't know. We'll have to have him on and discuss this with him.

Because I think that's the main thing that I disagree with the characterization here. It's like Mr. Beast literally built this for YouTube like two years ago. Like it's like it predicts how well your thumbnails and titles are going to do and so like we're here like people people have these tools maybe maybe it's not good enough yet and when it gets better then it really becomes you know give the people what they want but i don't know i mean yeah it becomes all ai generated it becomes all all very addictive. And it becomes wireheading and no one ever goes outside. And they get the juice reward and they get the nutrients directly delivered into them. And that's the end of humanity.

Beautiful. Except for us because we'll be lifting on Mars. Speaking of the end of humanity, we got a post from Patrick. Patty calls and he says, Grok's voice mode remains active when the app is closed. This behavior is made very clear with a live activity. It ends up being an awesome experience. Plop it beside you while reading a book and bat occasional questions its way without interrupting your flow. Uh, I read this post and I read the first sentence

Grok voice modes remains active when the app is closed. And I just thought like, oh, this is going to be bad. This is going to be like, it's spying on you. You need to be aware of this. Like I thought, cause I didn't even see it was him. Uh, and I love that.

It's just like, this is exactly what I want. Actually. This is great. Uh, and I completely agree. Uh, what was I,

it's funny. Cause, cause Patrick has the perfect index on AI, which is every AI company pays him, you know, 2.7% of every dollar. So he can be the sort of Switzerland. He's like the Switzerland of AI, the true Switzerland of AI. You know, everybody can run on Stripe. But this was cool. I mean, it does seem like, you know,

voice has been this sort of lingering trend that everybody's been predicting, but it hasn't quite played out, right? It seems that voice has been predominantly used by people that aren't good at using their thumbs. And it hasn't been the preferred sort of method of communicating with your device. That seems to be changing, right? Sesame came out last week and had a pretty incredible response.

It's a wild experience to use. And now Grok is, you know, I flagged this post from Patrick because I think we should try to leave Grok running for a show and just start interacting with it and saying, you know, when we have a question that I would otherwise Google, we can just ask Grok, and it'll have the context from the conversation and be able to sort of surface relevant data data so that's cool but we're having trouble with x servers today our live stream on x uh the entire servers to grok yeah what happened

yeah clearly they're not they're not deploying ai they're not deploying the service to the humans we're the second class citizens now yeah well it's, it's a disaster. But sweet. Well, let's jump in. We got a promoted post from ad quick, our favorite way to advertise out of the home, out of home, out of home advertising made easy and measurable. Say goodbye to the headaches of out of home advertising. Only ad quick combines technology, out of home expertise and data to enable efficient, seamless ad buying across the globe. Love to see it.

And what I think is amazing, in the same way that any company in the world can go on Meta and just sort of sign up and start running ads alongside the biggest companies in the world, same thing happens on Adquik. Biggest companies in the world, there's like a ton of the Fortune 500 that runs on Adquik, Wall Street Journal,

Warby Parker, Ramp, Discer ramp discount tire instacart credit karma h&r block lift all these massive companies use it but you as a startup can go and start testing out of home yeah uh you know even on a smaller scale so you know another way to advertise out of home make a t-shirt like jason carmen did there we go on to the next post says, we made a movie about space for free on X. Then we made some t-shirts. All of the designs are love at story.inc slash apparel. Go check it out. We love to support Jason Carman here.

He has made some incredible documentaries. Absolutely, dog. And yeah, he's building a whole media company right now. And it's fantastic. And yeah, I mean, really cool designs. Like very, very iconic. I think these will age very well. And yeah, good to get it out in the world.

And I'm sure it'll start a lot of conversations about the content. If you see somebody rocking a Jason Carman original, you're like, yeah. You know they're an absolute killer. Techno-optimist. Should we go to Carpathy on 4.5 again? Let's do it. So this is a reply to someone, Zvi Moshevitz, saying, GPT 4.5 reaction time, go.

Anything you want to make sure I don't miss or your own reactions. And Karpathy says, my reaction is that there is an evaluation crisis. I don't really know what metrics to look at right now. MMLU was very good and useful for a few years, but that's long over. Sweebench verified, real practical verified problems. I really like and is great, but it's self too narrow. Chatbot Arena received too much focus. Partly my fault that LLM labs have started to really overfit for it via a combination of prompt mining, private eval bombardment, and worse, explicit use of rankings as training supervision. I still think it's okay, but there's lack of better. It feels like it's on

the decline in signal. There's been a number of private evals popping up, an ensemble of which might be one promising path forward. And in absence of great comprehensive evals. I tried to turn to vibe checks instead, but now I feel they are misleading and there's too much opportunity for confirmation bias, too low sample size, et cetera. It's just not great.

TLDR. My reaction is I don't really know how good these models are right now. Yeah. You got to get the models to write, uh, to write little stand-up sets, feed them to stand-up comics that get bucket-pulled at Kill Tony

or go on the stand. Put them in the Sesame. Put them on the stand. No, it's got to be humans that step on stage at the Comedy Store on an open mic night. And don't get booed off.

And then you measure the boos to the laughs. Yeah, boos to the laughs. No, I think the real bench, like the only thing that really matters right now if you're a foundation model company is being significant, noticeably better, not to benchmarks, noticeably better than chat GPT

for specific use cases, right? So Claude is noticeably better at coding, right? And so people use Claude. Grok is notably more entertaining for some specific use cases for consumers than ChatGPT, right? So that's like something that, you know, potentially, but you have the situation right now

where 100 million plus consumers love ChatGPT. They think it's awesome. So if you're competing with them, you don't just need to be 10% better on some random math benchmark. You need to be 50% better so that somebody will try you and switch to you for their day-to-day use. I think that's what actually matters in terms of winning. And, you know, you can see what, in my view, you can see what companies are actually, consumer AI companies are actually doing well by looking at the App Store rankings, right? It's not, it's a snapshot and it's obviously momentum driven. But if you're a

consumer AI company and you're not on the App Store chart, while OpenAI has continued to have a pretty dominant position, you're not in a good spot. And that, like the App Store chart is the final benchmark, the real benchmark that matters matters it's got to be so hard to try and be competing in llms right now because it's like you have people who are everyone there is like an open ai co-founder or adjacent to the president or a state actor it's like if you're not on the highest highest level like how are you how are you competing there it's going to be tough anyway we. We got Shiel in the waiting room. Let's do it.

Let's bring him in. Let's talk FinTech. Let's talk Stripe, Adyen, Ramp. We're not going to call it FinTech today. We're going to call it finance technology. Finance. Finance. Finance tech.

Finance technology. Let's go. Let's bring him in. Let's chat. Let's chop it up with Shiel. How are we doing? Should we do one more related post? Will Brown says,

it's interesting that 1.5 billion parameters is all you need to crush math competitions, but you need like 15 trillion to make the model funny. Maybe humor is the right measure of true intelligence. And I agree. I agree. It is very difficult. can you see him in the waiting room yeah i just see his photo here oh well 15 trillion parameters quickly to be funny uh the whole be me thing is funny because uh it feels like it's going to really benefit from personalization. Like the people that are like, oh, it's so funny.

It's like, well, yeah, Tyler Cowen, like you did laugh at it because like it's funny that the LLM knows so much about you. But you give that to just some random person off the street and it's like, be me. Like, I don't know. The LLM doesn't know anything about you or like you just have a normal job. Hey. There he is.

Hey, guys. What's up? Oh, looking good in the suit. Let's go. He was prepared. Thank you. anything about you or like you just have a normal job hey there we go hey guys welcome up oh looking good in the suit let's go he was prepared yeah i mean when you come on on this show you gotta you gotta dress up you gotta do the part i appreciate it i mean we had we had uh quite a lineup today nobody showed up in a suit but you did which is why i think you win the day you win the day hey let's go let's go let's go i love it uh super excited to have you here i mean we we've had you on the show informally dozens of times constantly surfacing uh the stories that

matter but um i don't know we've had a big week i think why don't we start i want to kind of start with uh maybe kind of extrapolating on your Stripe adjun point of view. You covered this last week. Let's start there. And then I want to kind of broaden it and talk about FinTech more broadly. There's been some big news, but maybe we start there. What's your takeaway? Yeah. Yeah. What's like the main takeaway from, you know, I think you've tried to generally stay somewhat impartial, right. And just sort of like put the numbers out and let readers take away their, their own opinion. But, um, but yeah, what, what, what's your, what's your expansion there? Yeah. So, so the overall headline is the

Stripe Stripe puts out an annual report now and Adyen's a public company. So they do, um, they process a similar amount of volume. Stripe is slightly ahead, growing slightly more. It's like $1.4 trillion processed by Stripe. And I think a lot of people look at that and say, OK, well, these are equivalent companies. So it's crazy that Stripe trades at $91.5 billion when Adyen's a public company trades at $56 billion. So a lot of people said, OK, that's a sign that the private markets are overvaluing Stripe. I don't think that's exactly true. Like, although they have similar process volumes, their margin profile is different.

So like when you make a transaction on Stripe, Stripe actually charges more than Adyen does, in part because of the types of businesses that Stripe serves. Adyen has a lot of enterprise businesses. Stripe has some smaller businesses. So Stripe, most likely, actually has greater net revenue than Adyen does. We don't know it because Stripe hasn't posted that publicly. But overall, I think both are amazing companies. I think Stripe, you know, people fault them for having more employees, but I actually think it's interesting. I think like Stripe is investing more in R&D and they're growing faster and they have a lot more business lines. So I think both are outstanding companies. I actually have exposure to both, which I'm quite happy about. Amazing. You got to be, the best case scenario is you're conflicted, but the even better scenario is you're double conflicted.

And they're both ripping. a behemoth by basically betting on these super early stage companies, right? Many of their biggest customers today were startups when they were all going through YC together. And that's turned out to be a fantastic strategy. Is part of the reason that Stripe could be worth significantly more than Adyen right now is that the sort of general investor base believes that they'll be able to take customers away from Adyen, these sort of bigger enterprise players, because all the marketing, you know, Stripe has been able to take these two lines, right? They've got Stripe Atlas, so they're going to get the next generation of companies. But then simultaneously, when you see they're out of home ads today, it's all oriented around, hey, we signed Hertz, rent a car, right? Like they're clearly marketing. And so do you see Stripe's, you know, what are Stripe's biggest, you know,

future opportunities, you know, enterprise and sort of beyond? Yeah, so you're absolutely right. So Stripe does a phenomenal job of getting all early stage startups or a huge percentage of early stage startups. And actually, like, this business, it started like almost 15 years ago now. And at that time, your CTO was not making the decision on who you chose for payment processing. That was not a CTO's decision. That decision was made by if you had a CFO as a CFO, or it was like the CEO, because it was a money decision. And then what Stripe did is they said, we're going to save you so much time and energy in getting a payment processor up and running that it's going to be the CTO's decision.

And the CTO is a little less price sensitive and is going to go with the best option that saves them time and engineering resources. So Stripe charged a little bit more money than you would pay if you went somewhere else, but it was transparent and you knew what you were paying. And then along the way, a lot of those early companies that they signed ended up growing into massive behemoths doing many billions of revenue. And so that was awesome for Stripe. But now Stripe is also saying, okay, like we got those customers that started with us when they were small and grew up. But to your point on the out of home and like when they're at conferences and stuff, they

are trying to attract these other behemoths as well. And so, you know, I think they have part of Amazon's business. They have Shopify is large in the, I think if you look at in aggregate, if you consider Shopify one, then Shopify is probably the largest single opportunity for Stripe. But it's made up of, you know, thousands or many more than that of smaller individual retailers. Yeah, that makes sense. What other, what, you know, they've obviously, they're making a push into stable coins. What do you think they're, You know, I think it was very smart to identify that. Hey, what is the stable coin developer tool that has the most traction that's that's really working and just pay kind of any price to get that and then bolt that on? Right. That's basically what happened. What's your thesis around Stripe and stablecoins? They obviously wanted to own that sort of asset and have exposure to it, but it's not like they're

exactly rolling it out across the entire portfolio today. But what do you think that rollout actually looks like? So yeah, one thing that's kind of interesting is how this came to be. So one kind of funny thing is I think the Bridge stripe acquisition was announced three or four months ago. Yeah. And literally in the next month, I was getting five to 10 stable coin pitches per week. It's amazing how how quickly that happens. Like as soon as some some large acquisition happens, you're instantly VCs are getting pitched all sorts of companies around that happens. Like as soon as some large acquisition happens, you're instantly VCs are getting pitched all sorts of companies around that space. And everybody thinks, you know, because Stripe made this acquisition, now the space is super hot. I think what actually

happened here is pretty interesting. I think like Bridge is a very, a great company. I think what happened is they, so SpaceX had this problem with Starlink. So Starlink, you know, is an international ISP accepting payments in developing markets. Developing markets are really hard to accept payments in. Traditional banking infrastructure like totally sucks, is slow. It was like blocking transactions, like traditional infrastructure in some of these markets was blocking transactions. So SpaceX said, okay, we're looking for a solution.

I don't know if Sean McGuire was involved at all, but like Sean is close with SpaceX, is close with, was an investor in Bridge. And so Bridge- You can imagine between raging, fighting the culture war on X, was an investor in bridge. And so bridge can imagine between, you know, raging, you know, fighting the culture war on X. He was also doing the side deal to get the bridge space thing to happen.

I'm just saying there's a world. Yeah. The man contains multitudes. He's a man of many talents for sure. Uh, yeah. Do you want to finish and i have a i think like i think spacex using stable coins was a big moment um and i think a lot of other people said oh like we're having this issue too spacex is using stable coins with their bridge

yeah i think that was actually super instrumental for them even the scale ai example like really concretized it for me where it was like, Oh, it's very clear that you're paying a bunch of people in an international Philippines. I paid, I paid a video editors internationally using stable coins. And just because like,

it's, it's so much easier for them to get the money. And so I think as soon as you have that, it's very hard to be a skeptic about it because you're like, okay, I actually used it. It worked. It was,

it was, it was what everyone's been talking about for a very long time about easier, faster, lower fees, et cetera. But I wanted to flip it around for you and ask, you know, you know, you in consumer tech, you always have like, oh, Zuck's going to kill you. Do you feel like, you know, you get these bridge pitches post bridge acquisition. Is there, is there any fear like, oh, Stripe is going to build that? Is that a vibe that you see among early stage fintech companies? Because there's been a lot of successful fintech startups. Also, Stripe is a founder-led decacorn that is very able to move quickly. Yeah, I do think there's some of that, but I think that there are other, there are areas in which people have been able to build great businesses that Stripe was competing. Actually, you know, kind of crazy, maybe blasphemous to talk about, but one of your sponsors here and friends of ours, Ramp, you know, Stripe ended up investing in Ramp. Stripe, as you may recall, had a competing product. Yeah.

So it's not like you can't beat Stripe at anything they do. There are a lot of businesses that are going after it. Well, Stripe also had a stablecoin, internal stablecoin team that had been working for a while. So while Stripe, you know, those guys are super sharp. And as you said, founder-led. My brother works there. I'm all about Stripe. Love it. But I think there are plenty of opportunities to build businesses that go after businesses that

Stripe has been. And Stripe has a core focus area that they need to, that they're doing phenomenally well at. And they're doing a bunch of other stuff that I think there are opportunities to compete with them on. Just don't start a high-end publishing company because they will kill you. I would not touch it with a 10-foot pole, that industry. I think that's the one that they just have completely locked up, monopolized, and they will actually break your legs if you... Yeah, the Irish mafia.

The Irish mafia will come out to defend that monopoly. We should just hope that Stripe does not launch a podcast because... Game over. Yeah, yeah, yeah. We'll hang up the cleats. It'll be time for the Cloggy Brothers. Yeah, yeah.

Very true. You posted a day or two ago about the General Catalyst IPO and sort of rumors around that. How do you talk about, you know, I don't know if you speak generally. You don't need to give us any sort of inside baseball on it. But how do you think the sort of fee structures work when a venture fund goes public? And do you think that's going to impact GC's ability? Is it going to be good for GC's ability to recruit top investors because there's more liquidity? Is it going to be bad in the sense that people that really want to bet on themselves are like, oh, I could go work for BTV and get a

bunch of carry and I trust my picking ability and I can make a lot more, you know, getting actual carry. How does that unfold? I think on the latter part, I think like these mega funds, we'll call them the like, you know, double digit billion AUM going out to raise five to 10 each time. Um, there are the huge behemoths and like somebody who is considering working at them should not be considering working for us. Like we're, we're, we're playing a different game. Yeah. Um, it's like, you know, you're, you're a seed or series a startup and you interview somebody who's like, and you're like, who are they, who are you considering? And they're like, like well i'm considering meta stripe and you guys i i'm like get out of the room dude don't waste my time yeah we just had this it makes so much

sense so i think you know i think we play a different game like they're in the asset accumulation game and going public only furthers that sure um we're like they're going to make a lot of their money off of management fees from these billions of dollars they collect. And, you know, returns like they've had some great returns along the way. You know, they led Stripes Series B at I think a $500 million valuation. It's now worth $91 billion. So obviously they've done phenomenally well there. They have a few other bangers that they've had through the years, Livongo amongst others. So I think in the past, they've had some pretty good returns. I think in the future, it becomes more of an asset accumulation game. And if I think about how we as BTV,

if we're pitching or if we're trying to sell a startup startup to take our money it's like look like we're returns motivated we're driven by you being successful they're just and and like you're really meaningful to us versus if if it's a multi-stage firm it's like take their money later like they're not they're not as driven by always be there yeah they'll always be there we we won't be yeah yeah exactly um but i i think it's interesting i think think you're going to see more funds IPO. Frankly, I don't think this is the last one. I think, you know, it's certainly possible that Andreessen could IPO and and any of the mega funds could. Yeah, that makes sense. Especially if they're already set up as RAs, right? Yeah, exactly.

You have to be feeling pretty good lately, given that fintech is back. I'm sure you had. I'm sure you had. I remember this in late, early 2023. FTX had collapsed. I was running a fintech at the time that had digital asset features and traditional fiat features. And it just was like, where do we really go from here? Brex at the time was burning, spending like 800 million a year to make, you know, like what it was totally inverted, right? It was like 500 million in revenue on like 800 million of expenses. I was like, is this category like, you know, where do we go from here? Right. It was sort of a dark time. You guys rode through it. You know, crypto is really good at this, right?

Like crypto VCs, like the markets down, they're like, I'm going to get paid if I just hang on. VCs typically are like, you know, you probably had a lot of fair weather fintech investors that were like, we're going to go and do other categories. How, where do you think the biggest opportunities are in fintech today? And yeah, I'd even be curious, you know, without naming names out of the last few deals that you've done, can you kind of talk about the investment areas? Yeah, sure, sure, sure. So I'd say like FinTech overall, look, it's been a crazy time.

We started this fund five and a half years ago. It's been a roller coaster. And I've been investing in FinTech full time since 2016. Nobody gave a shit about us then. Then, you know, fast forward to 2021, we were the belt, the ball. Everybody, everybody wanted to invest in fintech. People were like begging us to give them advance notice on deals we did and then investing like months after us at in some cases like 15 times the valuation. It was absolutely bonkers and stupid, frankly.

Good for fundraising, I'm sure. Yeah. Good for fundraising, not actually good for those companies that took too much money. Sure. And then what happened was an overcorrection in 2022 and 2023. And in part because those companies had so much money, they didn't have to find PMF. It wasn't PMF or die. It was PMF or survive because you raise $100 million. Yeah. PMF or coast for five years.

Yeah, exactly. And so fortunately, most of the companies in our portfolio, they had enough money to survive, and then they didn't burn too much. And now they're having killer years. A lot of our companies actually kind of struggled in 22 and 23. But then 24 was a banger year, especially the second half. I think it was just coming out of that whiplash. And you saw it in the public markets, too. If you look at fintech companies, 22 and they were totally in the in the doldrums yeah i was just explaining i was just explaining

to john that square bought after pay for 29 billion and then was worth less than 20 20 like 25 billion combined like less than a year later i mean one of the one of the most one of the most devastating uh acquisitions ever in recent memory um by the way that's a fun topic so after pay so the the cool thing about that one is um our friends at matrix dane over there when they invested in after pay i believe it was a 80 It was an $80 million public company. What? Matrix led the A. It was an Australian. They were already publicly listed. Raising money in Australia just meant you go public. There's a lot of Canadian companies like that.

I see them all the time where it's like, oh, it's a $100 million company and they just happen to be public. Because that's how you get a deal done if you're raising five million dollars like you have to go public because i want all of the oversight and i want all the accounting and i want all the audits and so you better just be public if you want me to underwrite this yeah so so what a banger of a deal like they invested any of us could have invested in yeah and then like i don't know i don't know how many years later it's four or five years later sells for 30 billion dollars i i think when all said and done what what happened was it got announced at $30 billion, but by the time it closed, Square's stock had already dropped a lot. So it was like half as much,

still quite a banger. Yeah. Amazing. That's why they brought in TJ to find the next one, right? Yeah. So there was a bunch of, you know, bunch of businesses started super low rate environment that, that worked in that, in that sort of setting and then sort of started to not work, uh, in, in 2023 and beyond. How are you advising your founders around? You just, are you, are you telling them like plan like this is the new normal? Uh, uh you know it's been easy to imagine a situation where trump just lays on the pressure to to drop rates but um and then and this reminds

me you have a portfolio company mercury that that generates you know basically like really obscene levels of of ebita but it's predicated on um you know this sort sort of Fed funds rate that they don't control, right? So they've built a fantastic product. But so, yeah, how are you advising your portfolio companies around the sort of rate environment, given that so much of the returns in fintech are driven by finding that perfect balance? Yeah, it's true. And I would say overall, lower rates are great for us. We have Mercury and one other portfolio company, Relay, that are benefited by having higher interest rates. It's because they're sitting on deposits. So, you, to your point, they're printing money, but investors have to think about, okay, what is the rate that we can assume is going to be the case going forward? It's really hard to predict these things.

I don't think it's going to be back to where it was in 2021 anytime soon, if ever. But at the same time, you could totally imagine a period in the next decade where we have effectively zero interest rates for like five years plus, like post some sort of recession, like inflation. That was why when the, when the Mercury news came out and you know, they were getting a $3 billion valuation and everybody's like, Oh, this is great. Cause it's two X, whatever they got priced in 2021. I was looking at that and saying, they're not really getting credit for that profit at all. They may as well, like there's other companies

that are losing $200 million a year, much less making $200 million a year that are getting priced like that. So fundamentally, America just has a lot of debt and keeping a high interest rate is not fun when you have a lot of debt. Yeah, totally. I think we're gonna see a lot of pressure from Trump.

I think there will. At some point in the future of American history, we will see low interest rates. Yeah, the next grift, there's been one grift every two weeks, but the next might be dropping rates just long enough to refinance the whole Trump. Yeah.

But anyway, so your general position is like, assume they're going to be somewhere between here and 2% and you got to make your business model work kind of anywhere in that range. Sure. Yeah, totally. And one thing that's interesting is like Mercury started before, like Mercury was making a large portion of their revenue off of the rate. And then in 2020 rates dropped, they lost a huge portion of their revenue and then actually like built up a pretty substantial interchange revenue business. And like kind of, I don't remember the exact amount, but like in March 2020 rates dropped,

Mercury lost a shitload of the revenue. And I believe that like two or three months later they were back up to where they were from before. Yeah. Yeah. Yeah. That makes sense. Since it's the topic of the last 24 hours, I would love your take on the strategic scam and gambling. Yeah.

Strategic crypto reserve? Yeah. Yeah. Yeah. I think it's total bullshit. It's like it's a classic big government idea that masquerades as some sort of like forward thinking policy. You can say we're innovative or whatever, but it's actually quite the opposite. We're literally handling handing public funds over to like, you know, private cronies and wealthy people like myself. Yeah. You said you said your single biggest position,

personal position is Bitcoin. So you're actually, and the craziest thing is, we started the show today and we realized that the Bitcoin price had almost round-tripped back to, which is the biggest bear signal that the government announces, hey, we're going to be investing in crypto now. It doesn't move the market materially or in any permanent way. Yeah, it's crazy. This wasn't really priced in fully. It's ridiculous. I think like my point of view is on this

and a bunch of the other stuff that Trump has done in this administration. I feel like, you know, it seems like a short-term political win, but long-term it's bad. And in this case, I think this crypto reserve undermines the dollars position, which is like fucking awesome.

Yeah, that's right. The dollar is the global reserve currency. And this sends some sort of confusing signal about our own confidence in USD. Yeah. And like other countries hold dollars because they're stable, consistent and predictable. Yeah. And, you know, I think you could make the case for Bitcoin. I wouldn't personally. Sure. But you could make the case that Bitcoin is the new gold and it's some sort of hedge against inflation or currency instability. I don't think you can make the case for fucking Cardano or XRP.

Like, what is this shit? It's bullshit. It's basically a taxpayer funded backstop. Now, David Sachs came out today against Joe Lonsdale and said it's not taxpayer funded. I think that's bullshit. Let's say there's confiscating coins and holding them. It's the same thing. Like if you like previously when they confiscated, they sold.

Yep. It's the same thing. Like it makes no difference. What about the argument of like, you know, during the bank bailouts in 2008, obviously like it looks very bad because it's like taxpayer money is going into the,

the balance sheet of bank of America, Wells Fargo, save those companies. But if you look back historically now and you read the Tim Geithner book, it's like, well, the banks paid them back with interest and the taxpayer actually made money on that. What about that argument? Yeah. So what's the argument for the crypto reserve? The argument is that it could be net positive to the taxpayer. Like the taxpayer, yes, the taxpayer does put money into this thing, essentially. But if it goes up, then they wind up paying less taxes down the road when the government wants to fund something.

Because, hey, we don't need to tax you as much because we went 10x long on X, Y, or Z. Yeah, it's just a question of do you trust the government to allocate our dollars or do we trust individuals? And so I think it's like a personal freedoms issue. So it's kind of strange to have it come from the Republican Party, frankly. Yeah, totally. It was odd. Anyway. Talk to us about you've got an accelerator, which vertical specific accelerator makes a ton of sense. You know, if you're, you know, YC is an amazing product and platform.

And why are you locking them in cages, though? Yeah, yeah. Yeah, no, that's a real question. Why aren't you locking them and putting a live stream on it? Yeah, no, I don't think that I think people are sick at this point of the pmf or die approach applied to financial products you know uh we we very clearly did not want that because there's been some bad uh bad things that happen when you just try to but uh what kind of companies are you looking for i imagine that it would be insane if somebody had the opportunity to go through the your guys's accelerator and they're building in fintech to to choose yc not because yc is not great but just because you guys can connect them to this hyper hyper specific network and yeah yeah i totally

agree yc is great um look i i ran an accelerator 2016 to 2018 yc's i think gary said that they had four and a half percent of their companies became unicorns. Actually, in mine, 7% became unicorns. So we have a good success rate. So we have a good success rate. I think the idea is like, look, if you're building in an area that we have expertise, yes, ring the gong. We have expertise, we can be helpful. Now you asked what areas I'm interested in. I'd say, look, we're sort of founder-driven first and foremost, but there are some areas we've invested in a lot. One is this, you know, very unsurprisingly, we're investing in AI companies. We've done a bunch recently in the services as software space. Cool.

Including one, actually, we did with a previous guest on here, Keith. We have a company called Basis that's a AI for accounting company that is able to do a lot of the work that a low level account does. We led the seed last year. Keith led the A recently. We've done a bunch of others in that space. We did one in the SMB loan underwriting space called Kaj. We did one in the mortgage space, did one in insurance. And all these companies basically are using AI, but embedding themselves deeply into a workflow and solving a problem for somebody who probably could not build it themselves, which is exciting. I think my worry with a lot of these AI companies, you've seen all the charts, zero to 100 million

revenue. I think a lot of them that aren't as deeply embedding into a workflow, I think are in danger of going from zero to 100 down again. Easy come, easy go. Yeah. So we're trying to invest in companies that we think have some durable, lasting value, some data distribution, and embedded workflow value. And those kind of things are easy to find in fintech. Yeah. Have you touched any of these broader sort of more

PE style roll-ups? There's some opportunities in payments, obviously, for that. Have you gone into that space at all yet? And what's your general point of view there? We haven't done a whole lot of these PE roll-up style things. We've done a couple of things that are similar. We did one in the healthcare space that works in private practices called Marocca. I think, honestly, jury's out on those kind of businesses and raising venture dollars to do so. Probably works better for the asset accumulator harvester model where you can deploy a lot of capital with lower risk unless you're saying, we're going to replace every employee with AI.

It's easier to say, we're going to buy a bunch of companies at fair prices and get some efficiency, but that's basically just private equity, which is not the business that you're in. Not the business that we're in. That's exactly right. And so I completely agree. I was going to bring up like General Catalyst is buying a hospital system in Akron, Ohio. They're in a different business than we're in. And I can see why it makes sense for them. Really quickly, you say is buying. Can you break down like I heard about that deal like last year? Why is it taking so long? Like what's going on with that? What is this like a regulatory approval type of situation? Yeah, I'd imagine. I don't know. I don't know. But I'd imagine when you're buying a health system,

there's a ton of shit that you have to do. There's like, there's pushback from the community. I noticed like immediately, like when we heard about it, I also saw articles like, Hey, this is fucked up. Like a venture capital firm is buying something that should be for the

public good. Yeah. There's been a lot of pushback on like, Oh, private equity bought this, you know, local clinic and like made it worse or like reduce the quality of care to like maximize profits. So

it's always been controversial. It'll be very interesting to see how General Catalyst positions themselves in the IPO. I mean, Citadel was thinking about going IPO back like, I don't know, 10 years ago. And hedge funds were seen as like villains of the crash. So they bought an investment bank to try and make themselves look better, which is hilarious to me because it's like, oh yeah, we're not the bad hedge fund guys. We're the good investment bankers. Both of those are like kind of villainized already. It's bad if you go banker to make yourself look better. That's bad. Exactly. That's great.

I think they paid McKinsey a fortune to advise them on how to position their brand going into the IPO. And then they just kept it private. And then they created Citadel Securities and printed. It was great. Yeah. You're probably got to jump because I know we had 30 minutes. Is there any IPOs that you're you're pretty convicted are happening in 2025 in fintech specifically? I mean, there have been rumors around Chime and Klarna and, you know. Chime and Klarna are the biggest. I think where Chime prices is going to be, you know, very important to the fintech world. I think like I think in the private markets it's currently trading at 10, but people think, you know, people think it's going to go out stronger. It's going to have a huge impact on me and our portfolio. Actually, we have some other companies that are in a similar space. So I'm really looking forward to that one.

Klarna, I think, I actually don't know where it's going to price. Klarna has something interesting. They raised at a crazy valuation and then did a massive down round, which is not necessarily a bad thing, especially for them. Klarna actually does not have liquidation preferences,

crazy enough. So it actually was just like, they also replaced 100% of their employees with AI, right? Supposedly. It's just the CEO and Claude three sonnet cursor actually. Now somebody should go buy a Peloton and then see if see if a human bangs on their door or it's just it's just a chat bot being like hey please pay this back

uh no it's fine what but but chime what was their what was their 2021 or 2022 um valuation it must wasn't it or you know forex yeah 25 billion in 2021 yeah nice and i remember trading privately at like 30 yeah yeah cool very cool well we will have to definitely have you back this was super fun guys you're welcome any week and uh thanks for jumping on appreciate it cheers bye cheers see you later. Bye. Fantastic. Should we close out with, we were going so long,

the lights are turning off because we're running out of battery and we're really pushing to the limit today. It's great. Should we close out with some timeline? What do you want to do? A little bit of timeline. It's 2 p.m. We got to drive around in a Ferrari later.

You know, it's a hard life out here. More to come there soon. Also, not kidding. Did you see the Mr. Beast backlash? I thought this was kind of interesting. I didn't. So Mr. Beast did a podcast on Diary of a CEO. Have you ever listened to this podcast, Diary of a CEO?

No, but it's like the biggest. It's the biggest business podcast and no one in Silicon Valley listens to it. It's very odd. I mean, it's like it's popular, but it's popular just with like a very different crowd, I guess. I think it has a lot to do with the fact that it's very odd uh i mean it's like it's popular but it's popular just with like a very different crowd i guess um i think it has a lot to do with the fact that it's not an american show yeah guy's british and so even though he has he has great gas like i mean brian chesky also has like a web three startup he does yeah yeah oh i had no idea the the host really yeah wow he should have stuck to simple supplements i guess but anyway I'm going to let you read through this.

Yeah, sure. So Mr. Beast goes on Diary of a CEO and then Kotaku writes an article about Mr. Beast going on the show and says, Mr. Beast, life is, quote, so much easier when you're broke. And of course, this is very controversial. People get very upset. There's a viral post saying F you. It gets like 100 million likes. Everyone sees it as very negative and flippant that this rich guy would come on and say, ah, life's so much easier when you're broke. But that's not actually what he said. And it's very interesting. So Jack Appleby breaks it down. He says, this might be an all-time PR team screw-up. Mr. Beast went on Diary of a CEO podcast. The podcast PR team pitched Jack Appleby and other writers to cover it, which is something most people don't know about podcasts. But when you go on a podcast, there's a PR team for trying to amplify the attention that this guest gets. It's all very planned out, very insider plant, industry plant. And so when Kotaku wrote about it,

they used a pretty harsh quote. He said, I'd have done the same, except it's not a real quote. The podcast publicity team somehow confused Mr. Beast saying bro as broke. So maybe they use like AI dictation or something. But in a moment where he's just saying life is harder when you travel, they misquote him and made him sound like a jerk when it's not the case at all. And it's all naturally gone viral with the misinformation side of it, all because the publicity team tried to get coverage and they screwed up. So now Mr. Beast is taking heat. Kotaku is taking heat when neither of them deserve it. And so the real quote was, this is killing me, to be honest.

It was like so much easier when you're broke if you don't travel constantly. And that's not what he was saying. He was saying, it's so much easier when, bro, like you're not traveling. And it's fascinating. And of course, his original point is correct. But the Straussian reading of all this is, of course, that life is so much easier when you're broke. And that with wealth comes responsibility. Yeah.

And that when he's getting canceled for, he should have said the quiet part loud. And that everyone else is wrong. Yeah, it's true. He's also built up a brand where he's sort of almost promised his audience that he's reinvesting like 101% of whatever he makes. Like he's gone out with his brand at all. But, uh, I mean, Elon has said this, uh, and not back down from it where he said like, look, I have all this money. I'm the world's richest man. I'm miserable. You don't want to be me like i'm not having fun yeah like i'm i'm like like i'm having i'm doing there's forward motion there's energy but i wouldn't call what i'm doing fun and that's fine that's good that's also a choice you don't have to be he could retire he could retire by the biggest yacht and not ever talk to the exactly exactly yeah he could totally didn't have to buy

and plenty of people have yeah the the google founders did for a long time bill gates you could say has kind of been on that tip for a long time uh even ellison is kind of chilling from time to time like there are people that choose to be much less aggressive um yeah jason calacanis was the first investor in uber one of the first and now now he's deciding to go to war with a defense tech founder. He does not need to do that. He could pass on that, and yet he doesn't. He keeps kicking the beast, and everyone involved in that seems to love fighting. Love fighting.

It's very annoying for me. Makes sense. I'm totally over it. Anyway. Over it. Should we stay on the topic of VC? Liz Wessel, ramp investor. Congratulations to Liz. She was an angel. sense i'm totally over it anyway over it uh should we stay on the topic of vc liz wessel ramp investor congratulations to liz she was an angel uh she says has anyone written about the

trend over the last 6 to 12 months of founders 18 to 26 years old raising vc to buy old school businesses and inject ai into them i've seen so many pitches in every vertical on this in 2024 and it looks like still in 2025. I'm curious to learn how VCs who have done these seed and A rounds, often priced pretty high, are thinking about this approach. Blog posts or podcast recs? Appreciate it. Well, let's just do a podcast about it right now. Let's do it.

Here we go. Let's do it. So, Liz, we got the answer for you. We're going to go to Jordi, an expert in this exact topic. Jordi, break it down for us. Would you invest in a 18-year-old founder buying an old school business, injecting AI into it? And the seed round is at, you know, you're going to get one. You had me at AI, John. One on 99 pre.

I'm in. Send me the wire instructions. No, so there's two things that happen. There's two things that happened. The concept of the search fund exploded because the idea of these sort of old school IRL, real world businesses became- It wasn't a Silicon Valley thing. It wasn't a Silicon Valley thing.

It was an HBS. Yeah, it was an HBS thing. It was saying, hey, you could have gone to Goldman. Instead, you're going to take 5 million bucks and try to turn it into $15 million in five years, something like that. So that became popular. into $15 million in five years, something like that. So that became popular. And then the AI sort of enabled roll up,

started blowing up and Liz is right. There's just tons and tons and tons of these companies. My concern, generally, I think we're gonna see, we're gonna see returns in the category. It's not gonna be one where, everything that gets basically zeroed out. But that being said, you're going into your you're taking venture dollars and you're going into this sort of private equity world, which is like one of the most efficient markets in the world. Right. Private

equity has spent decades honing the ability to buy assets, make them better and then sell them for a higher price. And so by going in there and saying it's a huge bet to say we're going to we're going to be able to replace 80 to 90 percent of the employees with AI. Right. When when the models are good, but, you know, they're not agentic yet. Right. For the most part. And so my concern is that you're going to have that. It seems like the most likely outcome is like some of the big winners end up being the big winners still end up not being venture winners. Right. And that they get a nice three to five X and on invested capital, but it's not enough to sort of return any type of fund.

Yeah, I think that's a good point. I'm trying to think of like the private equity deals that I've seen like kind of up close and personal. And I'm going back to like Bain Capital. When I was there, the historical like banger for them was Staples. Yeah. You know, Staples stores. And that was not a digital transformation story. Yeah. Like that was very much a nuts and bolts, like what should the capital structure be? How do we lever this thing up properly? How do we close underperforming stores, ramp up overperforming stores? It was not, hey, the internet's here. I mean, this happened in the 90s. This is the main capital story. So I think they owned Staples from the 80s, 90s to the early

2000s. The internet was a thing. There is a world where you could be like, buy Staples and turn it into amazon.com. But I'm sure they launched an e-commerce site at that point, but it didn't like materially change the business. Same thing they bought, who'd they buy? Toys R Us. And that one, I think they got out, but eventually it went bankrupt and it was not a digital transformation story. And so, yeah, the private equity thing, it's like the, the, the, even though there's been a trend of like the internet for a long time there, like that hasn't been the story of private equity in my, in my, in everything I've read over the past, like few decades, it hasn't been, Oh, let's, let's go and buy the hospital network and we're going to

improve the user experience flows of the payments plan or whatever. It hasn't been, let's use the internet. The challenge is when you're buying a legacy sort of S&B, typically the founder is retiring. And the reason that that company, you know, outsiders will look at the business and say, oh, they run on pen and paper. They're not factoring in the fact that that founder was a staple of their local community, would work 12 hours a day for decades and put their blood, sweat, and tears into the business. And so you would get this effect of

you're ripping out this sort of owner operator who's made their life's work, this company, and then you're slapping some AI on it. And I don't know, I think you almost are better off with the owner operator, right? And so the value, and so in these businesses, when you're slapping some AI on it. Yeah. And I don't know, I think you almost are better off with the owner-operator, right? Yeah. And so the value, and so in these businesses, when you're buying businesses that are being valued on cash flows,

you need to make them grow faster and you need to increase earnings. Otherwise, the value is less. Yes. And so you can rip out costs to increase earnings, but the sort of replacement, the sort of what you're ripping out is human increase earnings, but the, the sort of replacement, the sort of what you're ripping out is human capital and injecting artificial intelligence. It's unclear

what that trade is going to look like in the short term. The other thing is the value capture lies because so, so, so hold on to that second point. But the, the interesting thing is like, like, oh, they're doing stuff on, on pen and paper. Well, if they're paying somebody, you know, $10 an hour and they're only spending one hour a month on it, well, that's 10 bucks a month. DocuSign is going to hit you up for a hundred bucks a month. You're going to 10X your bill by going not paper. Right. And so there, there's a question of like, how efficiently priced are the digital tools? Yeah. Because if they're really efficiently priced, they're going to take their pound of flesh and you're just going to wind up paying them.

Small businesses are like, you have the niece and nephew of the founder who kind of work for below minimum wage. And they're getting ripped out too. They're not sticking around. We're the grandchildren coming in on the weekend and racking servers. I've got a buddy in Malibu

who has a multi-hundred, like healthcare software focused PE fund. And he, uh, he has like, people don't realize like how, um, how precise these, um, managers are. And then he does not care to try to get a 10 X. He's like, I just want to get, you know, two X, uh, I want a two X. Uh, and that's really all that I care about, but I'm never going to miss. And I'm just like only. And so you're coming in and you're competing with an operator where you're going to have to pay, you know, people that are selling their businesses. Usually they have some type of long-term incentive to make sure that the, the, the acquisition is successful. Do they want to sell to the guy that's a proven operator that's like literally like,

I'm going to go out of business if this doesn't, you know, my fund is going to be damaged if this doesn't work? Or do you want the 22 year old that's like, you know, I'm rolling up, you know, pools. Like I saw like a pool roll up that was like, and I think it's awesome. Like it's a cool shot of the pool but you know uh i i i'm it's unclear if public pools no no like residential

pools so like if you can so if no so you can go on a biz buy sell or some of these other sites right now and you can buy a pool route and it'll be like, basically the client, the clients. And so these things trade over time where you can go and say, yeah, I'm going to buy, you know, thousands of pool clients and outside of Austin. Right. Roll this up.

The challenge is like the, the, the competitive pressure on a pool route is so intense that anybody with, you know, a hundred dollars worth of equipment can clean pools. Right. And so it's not, it's certainly not a monopoly type environment. Totally, yeah.

Yeah, I mean, I can see a lot of VCs getting burnt here, mostly because even if you wind up shifting from, look, we have 100X in our fund to everything's a 3X, and you work out the math and the IRR should be the same, that's not the entire purpose of a single fund because there's plenty of situations where, yeah, you want to get a seed into some company and then you want to pile into it with your growth fund.

And if you're just getting a 2X, you're not going to pile into it and scale it. And so it's kind of just this hope that AI will transform private equity and maybe it will, but we don't know. We haven't seen it. Yeah so it's kind of just this, this hope that AI will transform private equity and maybe it will, but we don't know. We haven't seen it. Yeah. And the risk for venture funds is that you're running a traditional venture model and then you say, oh, we're going to put 20% of our fund into a bunch of, you know, roll-ups and then you get a banger and it's a 4X and you're like, great. Like we still are like are under going to underperform.

Right. So anyways, I think venture people need to understand that, you know, we like to go into other industries and sort of say like, oh, like you guys have been doing this all wrong. Expeditionary or boondoggles. I mean, they're basically boondoggles. Maybe. Hopefully it works out.

I hope they figure it out. Let's go to Molly O'Shea. This is a fun one. I think we should take this into account. We've been podcasting pretty hard. I think we should announce that we're taking a break. We're going to take maybe 18 hours off. Yeah.

So you won't hear from us for a while. Yeah. We're going to end this stream eventually, and it's going to be about 18 hours before we start up again. Yeah. We're going to spend time with our family yeah yeah really recharge the batteries yep deep breaths and stuff but then we'll be right back at it uh but let's let's close out with this uh post from

molly o'shea she says after further analysis i've come to the difficult decision to go into hermit mode i will be refraining from any generalized social interaction or networking like events, travel, conferences, and coffee chats for the foreseeable future. If you want to hang out, sign up. Link in my bio. My team will get back to you. Brave, Molly. Brave. You're brave.

I wonder who inspired that. I wonder who inspired that. No, we love Molly on this show. Our default answer when we get invited to events now is uh come on the show yeah we're happy to cover it on the show if you invite us to an event we're gonna say no but if you tweet about it we'll cover it on the show if you want to call in you can call in too everybody wins but uh you're probably not gonna get us out of this chair because it's so much fun it's just too much fun it's too much fun you never want to turn off the stream are there any on bangers what was your sleep score last night because i i had a rough i had a good one i got a

ton of sleep it takes me having the worst night of the last 30 days for you to for you to do better uh i got a 72 i got a 94 i slept eight hours and seven minutes. Let's go. You consistently do eight hours. This is great. You got the laugh track. That's great. Yeah. Amazing. Huge numbers.

Built like a bear. Sleep like a bear. Just hibernate every once in a while. I've been a bit under the weather, so I had to go to bed early. Still got up at six. Got in. Pumped the lighter. So I didn't set an alarm.

Yeah. I used the eight sleep alarm. The eight sleep the eight sleep alarm i didn't set it yesterday yeah you shouldn't have told me about that because if you're competing with me now i got an edge yeah you gotta keep these features to well i got some other secret features okay that i'll share with the audience but you're not me i'll have to do cover my ears no but i i didn't turn on the the warming feature at the end of the night yeah and so it was like impossible to get out of bed yesterday, even though I was sleeping in like two hours past, like whenever I normally get up. So anyways, go to 8sleep.com.

I forgot my transition. My original transition was when we go to the moon with Firefly, we'll sleep on an 8sleep on the moon or something. But somehow I missed that. And we are interested in competing with the audience. So go to eight sleep.com slash tvpn yep and get a discount on eight sleep and then dm us we'll get in a group and we'll all sort of motivate uh each other to put up crazy numbers yeah um anyways we got some more timeline i think i think let's do more timeline tomorrow i think we're i think we're good at this point. It's getting late. Good, good, good.

We got a promotion to film. Yeah, we are going to go drive a Ferrari around, which you'll hear more about soon. Fantastic. Thanks for watching. Leave us five stars on Apple Podcasts and Spotify. Leave an ad in your review. We got to do a review of the reviews tomorrow.

Yeah, we should do a review of the reviews we'll get them up on the show and thanks for watching we appreciate you thank you brothers we'll see you tomorrow see you tomorrow