This Week in Startups - Bolt's struggles with The Information's Malique Morris + How Yuga Labs' mint sent Ethereum Gas 120X + Gravity Sketch | E1449

Episode Date: May 3, 2022

First, we discuss Bolt’s declining customer base and struggles with The Information’s Malique Morris (02:50). In addition, we discuss Fast, Amazon's "Buy with Prime," ShopPay (25:35) and all the other developments in online checkout. Next, we cover a massive spike in Ethereum gas prices from Yuga Labs and Solana's bot attack (55:12). We wrap with our Startup of the Day: Gravity Sketch, a 3D design platform (1:11:35). (00:00) Jason and Molly introduce today’s show (02:50) Last Thursday, The Information’s Malique Morris published an article on Bolt’s declining customer base and struggles, he joins us to discuss (12:19) Ourcrowd - Check out the deal of the week at https://ourcrowd.com/twist (13:26) Speaking to Domm Holland and Ryan Breslow, how are they different? (24:19) Fiverr - Sign up for https://Fiverr.com/Business free for the first year and save 10% on your purchase with promo code JASON (25:35) Amazon’s “Buy with Prime” and their Amazon Basics monopoly (32:12) First Republic Bank - Discover what a long-term financial relationship can do for you. Visit https://firstrepublic.com/startup today to learn more. (33:08) Stripe doing their own Fast checkout, competing against their own investment? (46:20) Wrapping up with Malique Morris (48:50) Spring energy in New York (55:12) WEB 3 is going great update (1:11:35) We Live in the Future with our Startup of the Day: Gravity Sketch, a 3D design platform Read Malique's Article: https://www.theinformation.com/articles/bolt-a-checkout-startup-worth-11-billion-has-been-losing-customers-as-revenue-stalls FOLLOW Malique: https://twitter.com/luxeoflique FOLLOW Jason: https://linktr.ee/calacanis FOLLOW Molly: https://twitter.com/mollywood

Hey, everybody, happy Monday. It's a big Monday. It's going to be a huge newsweek. What do we got, Molly? God, it is, is it? It's never ending the newsweeks. This is, thank God it's Monday, though, because there were tons of stories over the weekend. We work.

We work. We work. Yes, we work. It's Monday. TGI Monday. Happy Don Julio on Monday. We work. Anyway.

We are opening the show today with an absolute banger of an interview. Such a sharp. phenomenal reporter, a conversation about one-click checkout, the whole ecosystem with the scoop machine, Malik Morris, from the information. We've done one of his stories like for the past three weeks about bolts and fast. So we just went to the source. Well, we want to reward the journalists who originate these stories and have them on the pod and talk to them firsthand. And it's just great for you as the audience, I think, as a proxy, to learn who are the reporters, how they do their jobs and who are the ones doing the real work? Because there's so much reaggregation that goes on.

And listen, there's a lot of commentary. And we're going to just take you straight to the source. So we go very deep into Bolt and Fast, what went wrong at Bolt, that big ABG Forever 21 lawsuit. And the Notie Gang, the people who have notifications turned on on YouTube, loved our segment with Malik. He's so good. And really, you can tell the reporters who really know their beats, he knows every single thing about it. Then we have a fun little update on the tweets that we were just trying to like ignore over the weekend, something, something. in Web 3 going great, a board ape drop, and a massive gas fee surge,

and another salon outage, and we just begrudgingly break it down. And then we wrap with We Live in the Future segment with Gravity Sketch. It's our startup of the day slash we live in the future. It's a VR tool for designers to collaborate and build stuff like footwear or cars or your new backyard. Collaboratively, it's going to be a great show. Stick with us. This week in Startups is brought to you by Our Crowd.

Our crowd helps you invest early in pre-IPO companies alongside professional VCs. If you're interested in investing, you can join Our Crowd for free at OUR-CRO-WD.com slash twist. Fiverr, get access to millions of freelancers around the globe to help turn nothing into something today. Go to Fiverr.com and use code Jason for 10% off. That's F-I-V-E-R-R dot com and use code Jason. And First Republic Bank, where everybody gets a personal banker who's reachable by phone, email, or text, and through First Republic's banking app. Learn more at FirstRepublic.com slash startup.

Member FDIC Equal Housing Lender. Hey, everybody. Happy Monday. Molly's here. Monday, Monday. It feels like the world is A nightmare. It feels like the world's at a very accelerating pace.

Like I say with the world's biggest smile, a nightmare, a complete, ongoing. It's just things are moving very fast. We had like Trump and like Ukraine and a pandemic and a stock market crash and a stock market boom. Elon's buying Twitter. And apparently a stock market crash again.

It's just, it's like a hard to. It feels like everything is happening. It must be a simulation, right? It's just like things are moving at such a increasingly interesting pace that it feels like that. So anyway, it's Monday, which means there's a lot of news. But we're very lucky to have a breaking news old school journalist on the program today, like somebody who actually makes phone calls and spends more than four hours on a piece. A beast.

And that person's name is Malik Morris. And he works at the information, which is, you know, If you don't subscribe to, go ahead and shoot the lock off your wallet and spend the $25. Welcome to the pod. Malik. Thank you. Thank you for having me. That's quite an entrance, quite an intro.

I know. Sorry, we're making you blush. We're making you blush. Wow. You're making me nervous. Let me ask, where did you work before the information? So I was in school before the information. Okay.

So I worked in retail. I'm in fashion retail for 10 years before starting out the information. And then during that time, I went to grad school for journalism. Shout out to Craig Newmark's School of Journalism at CUNY. Very cool. And then joined the information as a fellow. And then halfway through the fellowship got hired permanently. And I've been there since last January.

Wow. Friend of the pod. Craig Newmark. Great guy. Yeah. Boy, you found your calling in grad school. Way to go. I mean, I know we're just making you blush now and we'll stop any minute and just talk about the work.

But you're talking to a couple of former journalists and we're very impressed. That feels great. Thank you. You took the right route because most journalists wind up trying to build a set of clips, yada, yada. And so they do Huffington Post or Business Inside or whatever it is. That's like more content farming. You don't have time to call people on the phone, do long firm journalism. I mean, some of those places do do it at times, but it's not the norm.

Usually they put, you know, the early reporters on like, here, just rewrite this press release. or, you know, here's a tweet, make a story out of it. Here's a tweet that mentions Elon or, you know, Biden or whatever. But, okay, so you're at the information. And you started writing some really interesting stories about two specific companies that have been in the news. And they kind of are having this really weird dance. And you've broken a lot of the news about it. Of course, I'm talking about this fast checkout space, which there's two companies in, fast.com, which shut down.

We've had Dom on the program. And then Ryan Breslau's Bolt, which we also had Ryan on the program. So how did you get on the speed, I guess, to start? And then I guess we'll jump into the stories. So my reporting journey with the One Click Checkout, the World of One Click Checkout, started last summer. Last August I wrote a story about a couple of the checkout startups that were trying to give or working to give non-Amazon merchants the ability to offer customers in Amazon Prime like checkout experience, you know, where shoppers can purchase goods without having to create a new account and input their shipping and credit card information

for each purchase they make, right? That story profile three companies, a very small young startup called Peach Pay, the veteran in the space bolt and then the ill-fated fast, which, as you mentioned, closed its doors last month. And it was interesting because as someone who worked in retail for a decade before becoming a journalist and now covers retail as a journalist. Commerce lives and dies by checkout. So the fact that you would have companies trying to offer accelerated purchase experiences for brands and retailers that don't want to sell their wares on Amazon makes total sense to me. So in that regard to the story, it passed a smell test in my opinion. But after that story published last August, I started hearing rumblings from industry

insiders about Fast, in particular, not having a real business. And I thought that was interesting, right? And I have been hearing it from just various people over the course of a few months. And then when I went digging, what not having a real business amounted to was that Fast had built a stable of very small merchants with very little and annual sales. And this was intentional on the CEO, Dom Holland's part. He was going the route of Shopify and giving mom and pop retailers and tools to sell their goods online without having to work with Amazon, right? Noble cause.

But in Fast case, these merchants already had a ton of well-known checkout buttons for customers to choose from. That included, of course, PayPal and in some instances, Amazon Pay. Most customers, as we all know, are more compelled to click on PayPal and they are to select a button powered by a company they never heard of, right? So this meant that FAS was taking a tiny slice of an already eaten through pie, which led to the company generating less than a million in revenue in 2021. Now, this is all so intricate, right? it must be said that for checkout software firms who scale, it needs to process hefty transaction volumes. So think Shopify, right?

And Shopify shop pay their checkout solution that earns billions a year in revenue. But that's because the power checkout for millions of merchants. And that's because checkout firms only take a small percentage for each sale and then they have to pay interchange fees to their partners. So it's a very complicated space. Fast had a faulty merchant acquisition strategy, which had tried to course correct a little too late while raising a bunch of money and then spending a bunch of money. So that was my foray into all of this.

I wonder we should almost back up too and say that the reason, and this will sort of lead into my next question, a big part of the reason this got so heated, so soon as Amazon's patent on one click, checkout expired. And all of a sudden, in 2017, right? And so all of these companies then thought, okay, green fields galore to capture all these transactions.

But all of those big names were still in the space. Like, why do you think... And it's interesting, by the way, Molly. Remember that patent was a business process patent, a very controversial. Super controversial, yeah. Type of patent that people didn't think would actually hold up. It's interesting that the industry didn't even try to go after them. Right.

Or they sort of did, but they failed. because Amazon had so much money. So it was always like a really interesting setup to this really then ultra-heated space. But I wonder like who thought, I mean, apparently a lot of investors, right, thought it will just give hundreds of millions of dollars to companies that are going to be competing still with PayPal, Amazon, and then even eventually shop pay. Like walk us through that background and why anybody thought this was going to work. So, I mean, I guess I'm going to be a little more controversial here. So, yes, PayPal has accelerated checkout. You know, Stripe is trying to do the same thing.

You know, the legacy payment processors, right? But they also have tons of other features, right? And so being like, the idea of specialization is very important and can also scale. And what you're getting is actually the primary criticism of, the one-click checkout space that's often large, lodge that companies like Bolt and Fast when it was around. That it's just a feature, right? But I'll argue that it isn't just a feature.

It's an ecosystem. As I said, Commerce lives and dies by checkout. And there are trillions of dollars being transacted each year around the world. And fintech firms can build large and profitable businesses, taking small cuts of those transactions. It just takes time. And this is all happening at a moment, especially during the pandemic,

when e-commerce was ramping up, online shopping, adoption was ramping up, and the VC market was really, really hot, like the sun, melting. And they were just willing to throw cash, right? And so a lot of the criticism of this just being a feature that these companies were raising mega rounds at insane valuations. But I will argue that what they were doing, what they are trying to achieve, to me, makes sense and is absolutely useful and can scale, but it just is not going to happen in a time frame of this person raised at a $10 billion evaluation and now they should have revenue

at like $200 million within just three years of launching, you know? It's time for another R crowd deal of the week. Right now you can join R Crowd's investment in Soterro. According to the deal memo, Satero has developed a patented new approach to data protection. This new technique eliminates the gap. of traditional methods by securing any data asset, whether it's on-premises or in the cloud. And according to their deal memo,

Soterra is trusted by one of the world's largest pharmaceutical companies. You can invest in Soterra at R-Crowd.com slash twist today. And all over the world, companies like Sotero are innovating and driving returns for investors. Our Crowd analyzes many of these companies, then they select the ones with the greatest growth potential and they bring them to you. They invest from personalized medicine to robotics, to cybersecurity, where companies spend $150 billion annually. Our crowd identifies innovators so you can invest when growth potential is greatest,

and that's early. So if you're an accredited investor, you can join Our Crowd for free at OUR, CROWD.com slash twist and review all the current deals. That's our crowd.com slash twist to sign up for free. I think, yeah, this is a good point to explain exactly why this feature is not just a feature. it's a bit of a network play because if you're a merchant A and you have a million customers, all of them get cookied. You now have their address, their billing information.

Everything is locked into their browser. When they go to the next site, Merchant B, merchant B, if that you happen to have bought something from Forever 21, now you go to Zara. If they're both part of the network, the Zara person doesn't have to refill in their information. Right. And then the next person does it. And so everybody who joins these networks then gets to take out, what does it take? 90 seconds for somebody to fill in their address or shipping address, their credit card information. Even if you're using like the Chrome extensions or LastPass or one of these, you know, browser extensions,

you still have to put in your CC number or something and then auto-populate it. So they do make things elegant. And there is a network play there. but certainly overfunded and the personalities seemed just uniquely you have this like Coke Pepsi kind of situation where they're going at it and then both

CEOs seem to be crazy narcissistic millennials or Gen Zs. Maybe you could speak to like this crazy Dom character versus the crazy paranoid Ryan King character because that's I think

what I have the story here is that You have these two very colorful families. They're very attention grabbing, yeah. Yeah. Yeah. Well, I mean, so I think that they're very different, right? I think with Dom, first of what, Dom had a questionable business pass. Yes.

NPR did a really great story about a tow truck startup he had back in Australia that he ended up being incredibly litigious with the Australian government, which is quite unheard of for a startup. And he was definitely flashy. As we pointed out myself and my actually very brilliant colleague K. Clark at The Information, who really is the actual scoop machine that we worked on about just not only just the money that he was spending, but the way extravagantly spending it, you know, NASCAR sponsoring NASCAR drivers, having these flashy off-sites that's supposed to be recruiting events, like in Tampa, but they're not actually recruiting anyone from Tampa. So there's that.

I think with Ryan Breslow as a character, I know the tweet there that you all are referring to about, you know, Stripe and White Combinator, which I read through a couple of times and thought was, I can imagine why it's controversial, but looked at it and said this actually feels it's a little bit nuanced and, you know, this is this person's experience. And I also think that the age, he's actually a younger than me, which is trippy.

And the fact that he's helming this company that's raised so much money at huge valuations, I think on that surface feels. And also, you know, he is a dancer and has a dance company and all that stuff. So there's a lot of a mystique to the Ryan Breslow character that I don't necessarily feel is super dubious, but I can imagine it's super eccentric. whereas Dom Holland had a history of very, very uncultured business practices that seem to follow him to fast as well. Yeah, Ryan's 27. I don't know how Dom is, but Dom did have that background. I think when we all read.

He's a bit older, I think. Yeah, he's older. But he plays younger. I think he plays. He does. He can play younger characters. He's like one of those actors who does an age. Quite on purpose.

He's still in high school. But, yeah, I mean, I think going into that mafia's, you know, thread, we broke it down here. I think you're right. It's a very nuanced take because it is true. There is a technique. Listen, I was a journalist and I spent the last 11 years investing and I was on team Uber. There was a, there are a very explicit technique. There is a very explicit playbook and technique of if you invest in company A, you can't invest in B. You invest in Coke. You can't get Pepsi. You invest in Uber. You don't get Lyft. It just makes total sense. People don't want to have conflicts. So since you VCs don't want to have conflicts in their portfolio because it looks bad and it's hard to manage, you can actually work that, which is just people do it with me all the time.

Like, hey, just put $25K in and I'm like, $25,000. We're trying to put $500 or a million in. And they're like, yeah, yeah. And they just go and they try to get 25K checks from everybody, 50K checks just to block you from eventually putting a bigger check. And so when you get that small check offer, most VCs just they know like it's like, oh, you can't use a jet. Jedi my trick on us. Like, that's not going to work. Right.

And you just say, thank you, but we want to keep our options open to write a bigger check so we can actually have a play in the space. Right. And so that part was true for sure. But he was totally successful independent of all this. So, you know, it's interesting. And then that sort of gets us to like your latest scoop in a way. So, okay, you have this market dynamic, what producer Nick is calling it's a market poll

approach, right? the assumption that if you're a business that can capture even a tiny percentage of the volume of transactions that's occurring, you're going to make a lot of money. Obviously, that's the investment thesis behind all of the tens and hundreds of millions of dollars going into these companies and the crazy valuation. But then now, it turns out that according to your most recent article, both of them were terrible businesses. Bold was too.

Okay. So let's put a start by saying that both stories not the same as fast. So, FAST was a startup with the faulty merchant acquisition strategy and the leader with the questionable business pass. Both on the other hand is a company with maybe more capital than an ease that has gone through some changes in the beginning of this year and is confronting big competition and a cooling venture capital market. So I'll just start by saying. Okay. Yeah. Okay.

The fundamentals are not the same. The fundamentals are not the same. Stipulated. So I'll back up a little bit and kind of continue what I was saying about FAST. So obviously they were going up to a lot of really small merchants, right? So they're capturing merchants who already have a bunch of checkout options. And maybe the customer is not going to click on the fast button on their transaction page, right? And so that means they're taking a tiny slice of a tiny slice of a tiny slice, right?

So to correct this course of action last spring fast told the salespeople that they would focus on signing on brands and retailers with around 10 million or more in annual sales. That's actually counted to what Dom told me last summer. when they were going after companies with less than $10 million in sales, but that's not that they are there. The hope was to build a big enough stable of those types of merchants that fast would process transactions for and then generates tons of revenue. That plan didn't work, according to former employees, because the big merchants didn't see the upsides of working with a company

that had very small brands with very little customers. As you all pointed out brilliantly, these checkout options work best for merchants when they can cross-pollinate customers, right? So it makes less sense from our key brands to integrate a one-click checkout option that isn't going to bring them more customers. Now we can go over to Bolt, right? Their strategy was different from the outset. First, instead of being a button on a checkout page, Bolt is checkout as a software service. So when customers click checkout on one of Bolt's merchant sites, the experience from start to finish is powered by Bolt.

That leaves them in a less precarious position because the company is not hoping a customer will recognize this name and click on this button when buying something online. the customer then has no choice because they are at the checkout system. Where things get tricky for Bolt is that it decided last year to change its revenue model. The company used to charge its merchants a fee for its checkout software. In addition to the fee, it took to process transactions. Bolt decided to stop charging clients for its software and only take a 1% to 2% cut from the transactions that actually processed. Now, here's where things get tricky. Under the new revenue structure, when a customer creates a Bolt account with merchant A,

that merchant doesn't get charged a fee to process the transaction from this newly created customer. When that same customer goes to merchant B's site and buy something in one click because it has a Bult's account now, then Bolt would take a cut from merchant B's transaction. But this is predicated on a customer making a journey from one bolt merchant to another, which is very precarious territory. Okay. So when I spoke to Ryan Breslow, founder and former CEO, Bolt back in December, He said this fee change was to incentivize big name merchants such as Casper, who they've signed and Fanatics, who they've also signed, to sign up and bring their trove of customers with them. The theory obviously is the bigger the network, the easier it is to sign on big merchants,

empower the entire checkout system, which will then ensure that bulk gets a cut up every transaction happening on an online store, and the revenue will grow exponentially from that. But in the short term, that pivot, which some former employer spoke to said, was implemented, around last fall, it set Boat's revenue projections back a little bit. And Ryan Breslow told me this himself when we spoke in December, you know, before he stepped down to CEO. So what happened is Boat ended up having around $28 million in revenue. And from the transactions, it powered, according to a document that we viewed, instead of

the around $40 million projecting to have, according to people who were familiar with those projections when I asked at the time. So it's a little, I think it seems like a good strategy because you take out the friction of a merchant having to decide, I got to pay another SaaS fee. So it's like, well, listen, it's free. And if you bring somebody to the network, you don't pay. So if you brought them, you know, to the party, we're not going to charge them. But the next person, yeah, we'll charge them. Yeah, it's just they probably should have just done those one-offs with specific targeted customers, not a general one.

So if you want to join the network and you come in the front door, yeah, pay for the software, pay for this. But when they were going after those strategic ones, maybe they should have done that. But I've seen that in business before. You know, if you were paying, if the objection, the sales team came to say, listen, the objection is this 50K, SaaS charge we have. Say, well, what if we got rid of it? And it's like, yeah, we're going to lose 10 million this year. But the network will build and then that'll be defensible because that each merchant gets easier and easier and easier and easier. And if it's easier to sign them, then it's easier to sign the next one.

And then all of a sudden, you would get this velocity that would be very, very hard. We all know how hard it is to build something out of nothing. I'm pretty sure that's what all of our founders here at launch are doing all day, every day. That's what the startup game is all about. And it is really easy to give up. Turns out what you need is a little help. According to a study conducted by Fiverr, 25% of people surveyed said they had a business idea in the past 18 months, but almost 60% of them never pursued it. And the majority said it's because they just didn't have the resources.

So here's how Fiverr can help. Viver's talent marketplace has millions of freelancers across the globe. And these freelancers are accessible in just a few clicks. They have experts in design, data, marketing, website building, music, video animation. So much more, all of the ingredients that you need to make that MVP. Just search for the service you need, set the timeline and the price. And then Fiber will provide a list of freelancers who meet your criteria. You can look through their portfolios, read the reviews, know the exact cost before you pay.

Remember, every successful something was once nothing. So head to fiverr.com, two hours, and turn nothing into something today. You'll get 10% off your first order by using the code Jason at fiverr.com. That's fiverr.com. Use the code Jason. Now, is Amazon in this space too now? where I heard that they're extending theirs to third-party sellers. So if you're a third-party seller on Amazon,

and this one seems like a really clever idea. So Amazon made this incredible decision at some point, which really is amazing in terms of dealing with the government and antitrust. We're like, if you want to sell stuff on Amazon, you can. We'll let third-party merchants on. But now what they're doing, Molly, I think, is the third-party merchants can use Amazon checkout on their websites. And every time, buy with Prime.

buy with Prime. And so every time we... I mean, they have felt the pressure, the competitive pressure. Yeah, but think about this. Like, one of the big decisions of all these companies, and I was an investor in one, like, Smarty Pants, vitamins, I was an investor in. And it was always like, ah, do we put stuff on Amazon?

And then we lose people going to our site, and they take a big cut. And now it's like, oh, but we get this other benefit on our site. Because when you go to a site, I'm like, I always check, is it on Amazon? Because I want all my orders in one place. Oh, if it's not on Amazon, not Prime, I trust that. okay, then I will order it off of their side and go through the couple of steps.

This is like, I think, going to crush everybody because now you're a third-party merchant. You have no choice. If you're considering being a third-party merchant on Amazon, this makes it a no-brainer. Yes and no. So Amazon is not trustworthy, right? And a lot of... Tell me more. What do you mean when you say that?

I predicate this by saying that the big thing was... This is logistics play ostensibly, right? because it basically means that what the buyer with prime means that customers, that merchants, non-Amazon merchants can offer their customers same day delivery, right? Two-day delivery. The same

benefits they get with their Amazon Prime account, right? But logistics and fulfillment is an even trickier space in checkout because it's physical goods, right? So in order for this to work with Amazon, ostensibly these merchants have to put their goods in Amazon's warehouse,

right? Um, Do I want my items on the same shelf where Amazon can see and then copy it? And then it's on Amazon Basic. So that because that customer who like you is saying, well, is this on Amazon? Right. So Amazon is not trustworthy. That makes a ton of it. And in fact, third party, it's third party vendors have already been complaining about that when they list on Amazon.

Exactly. So if you're not on Amazon, there's a reason is what you're saying. Right. So if they're even going to feel compelled to offer this, knowing that they might lose their customer essentially because they might just want to go to Amazon anyway. And then also if it is checkout, because we're still not clear on what this is and how it's going to play out, beyond Amazon's immediate network right now, me as a merchant, am I even going to get that customer data, which as we know with Apple's privacy changes, it's very difficult to target customers. very difficult to get that first-party data, which means customer information that's coming through your own channels, whether it's your online site or your app,

and then be able to funnel that into Intel to target advertising to also retain the customers you already have. And if I complicate that with the checkout, how by Amazon, that I might just be kissing customer data goodbye because Amazon is going to use that for itself, you know? Yeah. So it sounds like a really smart play. It sounds like, and actually, in some of the reporting that we've done,

it sounds like a Shopify. crusher. It sounds, if anything, more so, like, really trying to just go out the Shopify. But whether or not it's going to succeed in doing just that from merchants that are not on Amazon for a reason remains to be seen. So I get the impulse to be like, all this is going to crush everyone, but I'm like, but it might not, you know? Fascinating. It just does help. I mean, if you, I did this the other day, Amazon was always like on the DL with basics. Like you do a search, some basics come up. They don't rank themselves first. I think they knew how to play the game.

And then since I buy Amazon basics on a pretty regular basis, it was in my navigation bar. Now, I don't know if they're showing Amazon basics and everybody's navigation bar. But when you go to one of the vendor pages, there's a thing called new arrivals. So I go to the anchor page because I'm obsessed with anchor chargers and all this stuff, as you guys know. And I look at the new page. And then I basically look at the new offerings and I buy stuff. I'm like, oh, there's a triple charger. I want that.

Now, I went to the Amazon basics pages and I started scrolling down. and I had no idea the breadth of products that they're doing. But if you scroll down this page, you're like, okay, they're doing towels. Okay, fine. They're doing mouthwash. Okay. They're doing dog toys. They're doing tampons.

Amazon's doing tampons. Okay. And dog toys and stools. And you just keep scrolling down and it's like they're going into ink. Oh, they're doing a venal lotion. Sorry. They're doing kettles. They're doing everything.

They're doing fire pits. and you're just like, wait a second. Wow. They're doing everything. And I had no idea, but they're doing wrenches, like hammers. And it just never ends. And I think that they have blown the doors off this. It's going to a totally different place now.

So this is potentially where a bolt or a fast or certainly a shop, well, I guess not a fast. A bolt or a Shopify could certainly be saying, one, we won't do this to you. But also to consumers, and one of the Nottis mentioned this, that the payment network itself should be privacy preserving by default. And that could be a selling point for me saying not only don't I want to shop on Amazon,

I don't want it to have my data. Right. Or anybody else but you. Right. Like I just want to click out this one time. That's it. We're done. Like cash.

Yeah. And it complicates the whole thing now, especially in the light of Apple's IDFA, They're app tracking transparency, which allows iPhone users to opt out of being tracked across different apps, which was invaluable data for advertisers, for merchants. It's all about loyalty, right? It's about you have to build a brand now. You have to be a reason for it to be a shopping destination for a customer, whether you're a brand selling goods or you're a retailer selling goods from a trove of different brands. and getting into bed with Amazon seems counter to that.

You know? So, again, I am not bullish on Buy with Prime as an overtaker of this payment space or even the logistics space for that matter. This week in startups is supported by First Republic Bank. A seamless banking experience is something we all want. But what does it really mean? At First Republic, it means you have access to your own personal bank. Banker, someone who knows your name and is there for you when you need them.

So whether you're browsing, their full suite of services, or just have questions about your bank statement, you can reach out to your personal banker by phone or email and through the best-in-class banking app. Ashley, a managing director on my team, has worked with First Republic on one of our fun accounts for almost four years, and she loves their customer service and support. See what a difference and always-on seamless banking experience can make for you. Visit firstrepublic.com today to learn more. That's firstrepublic.com. Member FDIC equal housing lender.

Interesting. What's this link.com that Stripe is doing now? I guess they are going to have, I saw they are going to do their own kind of fast checkout, I guess. Are they going to compete against their investment? What the mafia does. So that I'm not super sure of, but I have to look into that myself. It does seem like they accelerated checkout was kind of already in their pipeline. It just wasn't super like promoted or merchant facing, you know, in the way the fast was and bolts is.

But it makes sense. But again, like I said, when you have a company like Stripe that has an assortment of features and product offerings, it's like how dedicated can they be to just the one-click checkout solution, you know? if their bread and butter really is payment processing, you know? It's like that's where these startups are coming in and are trying to make a space for themselves is saying that we specialize in these things. So you can always count,

even if you look at Shopify's ecosystem, it's really in itself, an app store with a bunch of independent vendors, right? And the reason why that works so well is because each of those vendors specialize in that feature that that merchant needs, you know, in a way that Stripe may not be able to when it comes to one click specifically. So does that partly answer the question of why Stripe would fund fast instead of just building this? Is that what you're saying? Just keep it simpler by making it

different because that is still an open question, right? Clearly. That is a big part of the thing that I know I'm still trying to get answers on and trying to investigate. I know Ryan Breslow would say that that's just because Stripe wanted to come after the ball. Just to be mean. Just being mean and spiteful. I think it is a great question.

What we've seen with the saga that happened at fast, that is that it's not what we thought it was, which was just an acquisition play, which is you invest in this company and then eventually you'll acquire it. And so you have those capabilities kind of, you know, built in, whether that company operates independently or whether it's an aquahire, that obviously was not the case. So their actual intentions to invest in fast remains to be seen, at least on my end.

We should talk about the lawsuit, Molly. We talked about this last week. This is another crazy wrinkle. Forever 21's parent company owns 5% or has the option to warrants to buy 5%? Then they launched a hundred million dollar lawsuit. Allegedly, you know, shouldn't do that. So what's going on with this lawsuit? We had theories, but I'm curious what you think.

Yes, disastrous implementation among other accusations. I also have theories as well. My reporting has been focused on the nuts and the bolts. Don't pardon the pun of the company of Bolt's business and not necessarily the lawsuit. I worked in the story literally a day after the, the Bloomberg published their story about the lawsuit. Here's the thing. When you have brands as big as Forever 21,

legacy retailer like Forever 21 or brands have been around for a long time, like lucky brand, and a lot of ABG's portfolio and they're doing online commerce, their back-in system could be a mess. And trying to integrate, you know, your checkout solution into those systems can take a, a very long time. What I understand is from reading the lawsuit myself is what Bolt was promising in terms

of timeline of being able to integrate, either just the checkout software itself or a certain feature, like the loyalty program, into ABG's portfolio companies, online sites, and the timeline that actually ended up happening were different. I don't know that that warrants a lawsuit because that just sounds like the world of startups. I mean, how many, that just sounds like just the world of commerce. Like how many brands are saying, you know, we're going to release this car and then it's taking a year

because the software and the integration. And the reality of bringing things into fruition takes a lot longer. The epicenter of all this is that 5% ownership thing. And that state of place where I'm really interested. This is a negotiation. Yes. That's where things get interesting to me. I can't speak on this.

So alleged, I don't know any of what's going on. But it does seem like that 5% ownership stake that warrant that ABG may want to exercise right now. Or maybe they've been diluted. So maybe Bolt raised money diluted down that 5% or they're arguing that 5% and there's some contentiousness about this $500 million windfall, I guess, is. what it would approximately be worth for this retail. That's like really big money for them.

And so maybe they're using, maybe they said, listen, we want our 500 million, get us out of this. Or we want to execute on that. Maybe Bolt didn't want them to execute on it. Who knows? But maybe they wanted to sell it to somebody. So maybe Stripe wants to buy that 5% or something. You know, and they want the option to buy those shares and then sell them.

And so then this chess game goes on. We don't see the chess game. We just see the result. And the result is, hey, well, you put us in your deck. where the securities fraud thing is going to be particularly damaging. This is my observation, not, I don't think this was in anybody's stories, but when they claimed that Bolt was raising money based on brands in their deck that, is it AVG the name of this company? No, ABG.

Abg. Adentic brands group. Yeah. Hadn been acquired. Famously bought Barneys and then closed it. That's who did that? Yeah. First had a moment for New York.

Murderers. So the observation I had was, you know, if you raise money on a bogus claim, a claim that's not true, now other investors can say, okay, you misrepresented and, you know, if things don't go well, they have this claim of securities fraud. And they literally took the time. This sort of hint, right? They didn't claim it, to be clear. Like, that was a, they hinted strongly. Securities fraud. They did say you put it in the deck a brand that we didn't even own at the time. Yes. So you made a misrepresentation. And so then the interpretation was had Bolt raised money off of that untrue customer base that that could constitute security fraud. What's so interesting is how scorched earth it is. So even if ABG ends up with the 5% stake that's backdated at a lower valuation and they walk away with somewhere between $300 and $500 million, have they put Bolt in the ground with this lawsuit by just completely disparaging them?

Yeah. So to the point of alleged securities fraud, I don't know a ton or have substantial evidence or even substantiative reporting to talk about that. But if you're signing on a conglomerate, right, that owns quite a few brands, quite a few companies, touting that partnership as potentially leading to a lot of revenue by, being in the checkout solution for most, if not all of those merchants in time, to me, makes sense as if I were fundraising, right? Obviously, it remains to be seen, or maybe it's out there and I just haven't looked, whether or not they said we actually do have these brands live or can count them as merchants or we have some of them live and they have however many other brands that we also can negotiate to work with. just to show you how much money we can potentially make from just this one partnership.

Right, right. The latter to me is innocuous. The former obviously is a little sketchier. Yeah, could be actionable. And it sounds like ABG may not have cared, right? That's like because it's not unheard of to puff yourself up in a deck. A little peak. And it's very possible that ABG wouldn't have cared had there not been this other

several hundred million dollars. situation at stake. Right. Yeah. Yeah. This is like one of those divorces where like every horrible thing that I pinned in the marriage is like, and by the way, there was this time you didn't hold the door for me and this happened and that.

And you're like, okay, guys, just get divorced and like let us all be done with this drama. Yeah. Right. So long term, you mentioned you're not that bullish on Amazon Prime as or buy with Prime as competition to Bolt. Bolt, according to your story, it seems like so far in 2020, the prospects for its revenue growth don't seem to have improved. But where do you sit on the competitive landscape in general?

Like, could Bolt still emerge as a winner? Or is it all Shopify all the time? Well, I mean, the Shopify piece is really interesting because ostensibly Bolt is, you know, competing with Shopify. And here's how. So when we, when we did our reporting and we saw that in the first three months of the year,

it looked like Bolt's merchant base had contracted a bit. And we did, I did reporting and realized that, you know, part of that was just some merchants were migrating to Shopify from either Big Commerce or Magento or one of the e-commerce software platforms they were using before for their storefronts. If a merchant decides, it wants to jump ship to Shopify. Bote has a harder time integrating with that Canadian giant because Shopify doesn't want its clients to use any checkout system outside of shop pay because that's the company's bread and butter.

And in some cases, boat merchants were migrating to Shopify from Big Commerce and Magento, as I said. And this meant that they often had to leave Bolt behind. But here's the thing. Shopify powers mostly small merchants that don't, from reporting I've done that don't make a lot of money. The bulk of their revenue base actually comes from Shopify Plus for which they have tens of thousands, not millions of merchants, right?

So they actually don't have a monopoly on that space. And both is intended on going for encoding merchants that have single digit millions to hundreds of millions of dollars to even billions of dollars in annual sales. So I think you can still compete. again, I think it's the timeline that it might be promising investors. It might be promising itself and employees. It may be promising reporters, the world of when it can scale to, you know, a huge level to be, to justify a valuation in the tens of billions of dollars versus whether or not it can succeed.

I think, I think this company can succeed. I just think that the time, especially with the revenue model change, the timeline might be a little longer for it to hit the scale that it might be hoping to achieve. All right. This has been amazing. Malik, great job covering the space. Let us know when you got the next, when you got the next big scoop. You ever have this, hey, did you watch the recrashed?

Did you watch the request? Malik, Malik, Malik, Malik, yes, yes, yes, yes. Right? Yes, yes, yes, yes, yes, yes. Yes, yes. If you drink the Don Julio in 1942, Malik, you've had it, no. Good stuff? Have you had good stuff?

No, yeah. I liked, what did you all think? I like, we crashed. I loved it. I'm biased. I think Jared Lito has one of the most interesting and scary faces, but I can't stop staring. He's so compelling.

And I have the way he's like the love of my life. So I was on board immediately. She's love of your life. I find her to be like the most annoying person I can't stop watching. Are you joking? I'm leaving. This was like, I should have, I should have declined. Just like the devil works proud.

Are you joke? Okay, I should have declined the invitation. This is blasphemy. You're telling me she doesn't play annoying girlfriend, wife really good. She plays everything really good. She's an amazing actor. She's everything. Oh, my God.

But, yeah, I know. She also plays into the trope of her as an entity being annoying, which she totally is not to me. But she does play that up. And she does it to incredible effect. So, I mean, I think. those two, if this was a movie version, I would say they should have gotten Oscar noms, but obviously they should both get Emmy and nods.

Oh, for sure. Win everything. Win everything. All right. We cannot stop. We can't stop. Thanks for coming on the show. A bottle of Don Julio in 1942, should you be allowed to accept it, uh, he's gotten the

way to your house. I don't know if you're over 21 or not. I am. I appreciate that comment. I am over 21. I was going to ask that too. I'm like, 22. I am sitting on the front door of 30.

So my birthday was actually this past weekend. I turned 29. I'm not 30 yet. I had a birthday party with family. They're like, at 30 of this shit, I'm like, stop saying that. Okay. We did not lose that many years to pandemic. Happy birthday.

Thank you. We'll discuss. When I was 29 in New York in 1999, man, I own that town. I was running New York, man. I can imagine. I was on Charlie Rose, New Yorker feature cover of the New York Times. running my own magazine. Man, that was...

Just give Malik six more months. That was the time in New York. We're right there. I think feel like New York's going through a renaissance. Young people having fun in Dime Square, running around town. Feels like when New York gets a little bit edgy, it's a lot more fun. Like in the 90s, it was edgy. It was edgy A-F, as the kids say.

Like, I lived in a commercial loft, you know, like illegally, built my own bathroom. People were just doing it. We would go out. out to like robot, save the robots at 4 a.m. to listen to electronic music. Nobody can't it was like, oh, you can't serve booze after 4 o'clock? It was like, it doesn't matter. We're going to dance until 12 p.m. Like, it was wild. Yeah, stuff like that's still going on. It's happening more so in Brooklyn than Manhattan, but that's where I heard. Stuff like that's still going on. When I grew up in Brooklyn, if you had a Brooklyn driver's license

and you tried to go to the limelight or Palladium or Roxy or whatever in Manhattan, if you gave them your Brooklyn license plate. They would, your driver's license to hand it back to you and say, sorry, no B&T. So they, no bridge and tunnel. You weren't allowed in the club. So I had to get a fake, I went to say Mark's place and got a fake NYU thing and you just give your fake NYU student card and they would let you in. At that time, like, they were like, we don't care if you're 18, 21, whatever.

Do you have 20 bucks to pay? If you're from Brooklyn? They did care about that, actually. Yeah, they didn't want to know. Now you come to Brooklyn and you have a Manhattan license and they'll turn your you away. The same thing. The first B&T.

All right, Malik. Keep up the great work. Please come back. And Don Julio on the way. All right. Thanks for coming. Take good care. Thanks for coming.

So good. So good. Enjoy that spring time. Spring energy in New York. Spring energy in New York. Man. Wow. Does that guy.

New York was great. I miss New York so much. Spring in New York is amazing. I got to say, I'm having this like negotiation with my wife. Oh, really? are gone. You're out. 12 years,

62 years old. I want to go back to New York. I'm saying, just get myself a sick townhouse in Greenwich Village or like a sick like across some bandits. My favorite townhouses in the city are in the village right across from bandits and the village tavern.

They're so awesome. Yeah, that's what I want. Just give me one of those. And then I'll just be like an old. I'll be like 62 and retired talking about past victories, investing in people's. I'm just saying Brooklyn.

So much better. than Austin. You went to Austin recently or no? No, I just spent a lot of time in Austin and it's great. And if I was going to choose somewhere to end up, I would choose Brooklyn over Boston. You know, Austin's got a really cool. It's cool. It's cool.

But it's like, Austin feels like the city of the future. Like they really do have this. We could build and do anything. It's like literally like a boom town. It feels like a boom town. like we're going to just build everywhere like everywhere you look, trains and things being built

and people are like, yeah, you want to build something? Approved. And they're like, no, no, I was just coming in here to use the bathroom. They're like, approved. You're like, no, what do you want to build? Prove, put it in a condo. You're like, no, I was just going to ask you for directions

to, is there a Starbucks around you? Like, approved. You want to build a Starbucks? Approved. They prove everything. I know. Pretty great. Which is why it's going to be freaking unlivable

in like fire. No, more livable, Molly. Look what they did here when they said no more units. And it's like everybody was at each other's throats. And then you just slowly kill it. I'm just saying every boom bus, but Brooklyn like New York indoors. New York indoors, yeah. They went on a little building, you know, run in New York where they're just like in Manhattan.

Yeah, buy all the rights around you. So in Manhattan, like, if you own like a two-story building, you have air rights to 20, let's say. And the air rights are pretty generous. So then what happens is somebody's like, I'm going to buy these five buildings or I'm going to buy the air rights from these. four and I'm going to build an 80 story tower and I'll and then you know you're in New York like people are like I can't see the sun they're like go to Central Park go to the west side highway shut the you don't mean you can't see the sun and so this is a city you want to see the sun that's what the hampsons are for go go up to the cat skills like you want to see the sun like

really cares about the sun like there's plenty of places with sun on the west side highway you know like you watch the sun go down uh oh my god it's pretty funny cares about the sun is my favorite thing. That is my favorite. No, in San Francisco, they're like, people are trying to build like eight stories to, you know, and they're like, you can build three and they're like, why? And they're like, because you're blocking the sun and they're like, where? And they're like, on this nursery school, you know, these four kids go out to the backyard and they need sun for this two hours and you're, you're reducing it to 90 minutes. And like, in New York, they would be like, take those kids to the West Side Highway and they can have sun or wherever, you know, like,

you don't, you don't have a God-given right to have the sun everywhere, you know, like, sorry. There is this concept of shade. That's such a like out of context. That is the most astonishing. That's like a line from like Wally or something. You don't have a God given right to the sun. Yeah. Like we just put a big ass umbrella over your city. Boom.

You could look up and see the sun at some hour, right? Like you can go on to 14th Street. If you look straight up, there's like 45 minute window where the sun's over you. Other than that, we're not here to sound. It's a goddamn city. Yeah, I don't mean this to sound like an argument against density. I'm pro-density. Bring on the building for God's sake.

All right. In other news, I was really busy this weekend, rescuing kittens. I don't need a medal. But we saved two kittens. Did you save them? Four of them didn't make it. Two of them did. But it was a really hard decision, Molly, because I'm reading on, I don't know, I'm not a cat person.

In fact, I kind of don't like cats. Although these two kittens are winning my hearts. Everyone always says that at first, yeah. Exactly. So that we hear this crying, kittens like all day long yesterday. We kind of find them in the, in the ivy in the backyard.

So I'm reading online. It's like, stay away. The mom will be back and somewhere between like two and 12 hours. And so we're like, oh God, do we scare the mom away? What's going on here? We're waiting. We're trying to figure out. I'm getting advice online. Long story short, you're

not supposed to screw with the kittens until it gets cold or they're in danger. So it's getting a little cold. It's overnight. They're still yelping and that means they're in distress. So, you 10 o'clock a night or so, we go start cutting out, cutting the, um, the ivy and my daughter, uh, the 12 year old finds two of the six still alive. Uh, four of them didn't make it sadly, um, which is crushing.

Uh, but, uh, we saved the two. Thank God we were home. If we had been in, you know, Tahoe or away, they would have just all six that would have died, uh, sadly, but the mom obviously abandoned them for some reason. We don't know. Or maybe the mom's in distress herself. We got the two, uh, and overnight, we fed, them and they're thriving again.

They weren't moving when we took them out of them. And they were trapped in the ivy when my family took them out. My wife and my daughter. But they're alive. And we're going to have two cats up for adoption probably in six weeks or so. We got a nurse her back to health. And they're eating and they're moving around climbing. But their eyes are shut.

So cute. Babies. That is so darling and such a good deed. And there's no situation. There's no chance you're putting them up for adoption. No, 100%. They're not saying because I'm getting another bulldog. So we can have a pair of bulldogs here who will eat the cats.

And then you're going to have one of those really cute Instagram accounts where the kittens and the bulldog snuggle. Because if you get a puppy and then you have baby kitties, they're not going to eat each other. I'm allergic to cats. But anyway, my point was your mom. Exposure will cure that. I'm trying to, you know, watch the Warriors game, take care of my kids, same kids' birthday party. I had a boredom and philosophy bomb call this weekend. I got a lot of my plate.

You're very busy to him. No, I was like, I'm adding to it by lobbing philosophy bombs into the group chat. Like, it's not. Oh, my God, what the philosophy. There's a lot going on. Here we go. Oh, my lord. And, like,

everybody's trying to figure out people's motivation. Anyway, putting all this aside. My feed is, like, going crazy with the board ape maker, Yuga Labs, you know, being canceled. And the crypto people losing their minds.

And, you know, I just was like, I can't figure this out. Because, you know, when something happens in crypto, it's like, it's so complicated. If you're not, it's like people who are watching, like, NBA Twitter or you're watching soccer Twitter

and you don't know the names, the teams and everything going on and you're trying to back into it on Twitter, you ever try to do that? And you're like, can somebody just explain this to me? It's like, oh yeah, it's too early to explain it. But we need to explain this because this is a really interesting story around Web 3 still trying to get the rails and the plumbing working. Maybe you could explain to people. They've heard of the board.

8 Yacht Club, that's the NFT collective called Yuga Labs. Yep. They decided to do another project and then something went wrong. Can you explain to us what happened, Molly? Yes, I can explain it in by paraphrasing the Noddy Gangs, James, who says, Yuga Labs shat the bed. Ah, it was a shatting. It was a shatting.

I think that it was a shatting or medium shatting? Pretty, pretty like a pretty grande, like bigger than a poop bag shatting. Got it. So they Amber herded the bed. Got it? Keep going. Amber heard of the bed. Okay.

So Yuga Labs minted a land sale, I guess, like basically had a huge drop, right? They sold these. A huge drop? Of shat. Tens of thousands of plots of like, I think land in the metaverse, if I understand it. But did it all at once. And so then everybody went crazy trying to buy it. And then there was this 120x.

surge pricing for Ethereum gas transactions because as everybody tried to jump on and buy these plots like, yay, we're going to get it. Then the network was overloaded as I understand it. And so gas fees at some point, Yuga Labs raised $285 million by selling these 55,000 new NFTs at $7,000 each. But the gas fees cost the buyers, $176 million. At some point, I think gas fees were like up to $6,000 per transaction. Oh, okay.

Great. Which was bananas. People paid it anyway. Because they're so desperate to get anything that Ugo Labs does, they were willing to pay a fee of 50% or up to 100% apparently in transaction charges. Right. Which is quite paradoxical because the whole concept of cryptocurrency is that you are going to be eliminating fees. and lowering fees and fighting the power, why can't the fees be less than Visa?

Like, this is the great failing of crypto. You all have to get your shit together and stop grifting, because this is two levels of grift in my mind. One, the head of teas themselves. Yuga sold plots of land worth nothing for hundreds of millions of dollars that have no purpose in the world. I know that they will have some purpose someday, maybe perhaps you'll put your VR headset and go in there where they're collectibles. But let's be honest, they're selling vapor.

And then on top of selling the vapor, people had to pay huge fees to buy nothing. Because this is why people hate Web 3. I mean, it really is. Because the fees themselves are variable, right? So they rise and fall according to capacity. Again, if I am understanding that correctly, and this is a large. So that when there's limited capacity, yeah. So there's a supply and demand in what is basically taxes.

It's like, I feel like Ticketmaster looked at what happened over the weekend and was like, oh, hot damn. We're doing that. Yeah. I mean, right now, Uber search pricing is like, and you guys hate us? What? Totally. This was the ultimate surge pricing. That is the perfect metaphor for this.

That's exactly what happened. And you know Ticketmaster was like, oh, hell yeah, we're doing this next time. So then Jason in our group chat today rolls in with the best In the group chat now. Okay, that's fair game. Let's go. I got some Molly classics.

They're not all 14 year old boy jokes either. And says, hey, why don't? This is like, I love it when it's the most obvious, easy, perfect question ever. Why don't they just release their big drops over 24 or 48 hours to keep the gas fees down? Obvious. right? If it's supply demand and the network is surging

Right. Like what Travis did was and I collaborated with him on this back in the day was he wrote a blog post about surge pricing on New York's Eve and how to avoid search pricing. And he's like, you know, get to your party before 8 o'clock

or 9 o'clock because everybody's going to the party at 10 o'clock, 11 o'clock to get there right before the ball drops. And then, you know, if you leave the party, you know, an hour later, you know, at 1 a.m., you're going to do better than leaving in 12 midnight to 1.m. So if they just said, listen, we have a thousand, I don't know how many of these NFTs they dropped, but let's say it was 1,000. Well, in 24-hour period, you know,

you just release whatever it is per hour. Forty an hour. 55,000, yeah. I mean, it must have, it had to have been pure hubris, one thing. So like, producer Justin, because we don't honestly know, Justin, producer Justin saying, well, one way other projects have managed this is with an off-chain

reservation system. Again, just like buying tickets, right? When, like, when you really want those Hamilton tickets,

you could go online and get into a queue and then when it was your turn. Yes. But I think that would just be too centralized of a system. So in this case,

they let the market work it out and drop their $55,000 all at once and just, you know, because the centralized system would make more sense would make it more efficient. Because it has to work centralized.

It has to, yeah. This is like if you went to the debt, You know, you go to the deli and you pull the number and now serving number 32. Like that exists for a reason, you know, like, and this would be like if you pulled that ticket and they're like, now serving, who's willing to pay $4,000 to get a bagel? And you're like, just like let people queue. It's not the end of the world. I don't think it's the end of the world.

I don't know. Yeah. Anyway, it just apparently went bananas. I can't honestly, though, even tell if the crypto world is mass. about this? Or if they just went ahead and paid. People were on fire. But so they sold 55,000 NFTs for hundreds of millions of dollars.

And 100 and 176 million of those dollars were taxes, basically, were ticket fees, or ticket master fees. Got it. That varied according to demand. Okay. It is what it is. It is what it is. Like if you're, I guess the crypto space didn't like this, but 55,000 people bought or

wallets, 55,000 wallets. bought these things. So, this is, I am totally for, I am totally for variable pricing. And I just don't like this price gouging of fees. So,

you know, here's another idea. They could have made this an auction. And they could have said, you know, here, we have 55,000 of these and just say what you're willing to pay.

And what's the max you're willing to pay for one? And how many do you want? And then just, let the auction do it. So, you know, there's that way to do it too. You could do a drop, you can do an auction if you want to maximize price. I guess doing a drop is the most fair way to do it. But who knows, I'm sure there's all kinds of developers who have ways to sniping, you know, these sales and sniper tools. So it generally isn't fair. The fairest way to do that is to let people sign up, I guess, with phone numbers, emails, and do a reservation system

check and then limit the number they can do. Or what they could do is just not let people sell least for one year. That's another possibility, so you lose the flipping. There's all kinds of ways to do this. What the Grateful Dead we used to do was you would send the Grateful Dead an envelope with stamps on it and a money order. And it was a little bit, and, you know, they would, I guess, sort them, alphabetize them, whatever. It was just harder to do this. And if you were part of the collective that wanted dead tickets, they did their own ticketing and they would sell you the tickets direct. And then some of them

would go to ticket, master or whatever, but they wanted to make sure real fans could buy them. And, uh, okay. Yeah.

So there you have it. Evidently. And then Solana went down at the same time because I'm, you know, I got a bunch of venture friends who invested in Solana or the funds that invested in Salana. Um, was that related? Well,

no, it wasn't related except that Web 3 took two shats in the bed. Yeah. It was a double deuce. It was a double shatting. double-duce. Yeah. It was a bad weekend.

It was a double-dust. It was a tough weekend for Web 3. But Solana going down is related in that Solana was supposed to be faster, cheaper transactions to compete against Ethereum. Right. Ethereum. I don't know what's going on here that they can't keep Solana up and running, but they can't keep it.

This is like the second or third time they've had a big outage, which I guess could be expected. You know, the big picture here for me, Molly, is. at what point are people going to ship something other than NFTs and money store? And this is, I think, right. It's Web3's do-or-die moment, I think. I think this is all going to collapse in the next year, so you can bank this as a prediction.

So I hope I don't Professor Galloway this. But I think that the free money in the economy, you know, and the pandemic ending, and then people having other things to spend money on and inflation is going to make this asset class, you know, and any other speculative assets class. It could be stonks, you know,

like GameStop. It could be crypto, and it could also be watches and other stuff. I think this category of, you know, let's call it highly speculative, highly speculative assets. Mm-hmm.

Is going to move to, well, I have to live my life and I got bills to pay. And so maybe I have half as a, much money for this. And if everybody has half as much money for this, a third is much money for this, well, then people are going to be more discerning. So you might not see it in Yuga Labs properties. You might not see it in Bitcoin, Ethereum, but you might see it in other projects where people's, you know, propensity to just buy the stuff yolo and speculate, I think people are going to start

going to Vegas again and, you know, go into basketball games and just enjoying life. So crypto really needs at this moment in time to really start providing value. So if this Yugelab stuff is going to have a value in the world, like video games that they're, you know, and these worlds are going to be actually have some thing other than collectibility to them, I would highly recommend to anybody who's a crypto founder to ship product that provides value in the world. And enough with the selling of assets before you provide value in the world. That's the fundamental problem I have with a lot of these things, is they're selling like this project, you know, these plots of lands are going to be worth something.

These NFTs are going to back into something. You better provide something quick because people can only spend so much money on this bull-h until they demand some value. And I think we're getting to that point. I often think about the interview that we ran that I did with Elise Killein, who was a, she was part of the first-time fund manager Angel series. But what was so interesting is that she, you know, has raised this fund. It's almost like there's a serious.

side of the crypto world and an unsurious side of the crypto world. And she was like, we are laser focused on the Bitcoin network, the lightning network, the value that Bitcoin provides as potentially currency, contracts, and a fundamental technological underpinning that could be applied to almost every business. She's like, we're laser focused on figuring out where you build value on chain versus where you don't. And we're not around with any of that other crap. that other crap is like how it's all going to get sorted or its reputation will be ruined.

But I think that is fundamentally the unsirious side. It's the gambling. It's sort of like art for profit. But what's so interesting is how much money is headed into the unsirious side. And I just sort of feel like at the end of the day, Elise is going to be standing there alone, having ignored all of the sound, creating actual value.

And I'm just super interested to like stalk her through this whole development. element. I want you to listen to that. I was listening to a podcast where Weasenthal was talking to Levine. What's the fault? Joe Weasenthal from Bloomberg has a podcast that I'm actually going to go on. Talking to Matt Levine? Yeah. That guy is so good. He's a pretty funny cat.

And he was basically explaining how like yield farming works. And it was like, yeah, people put money into a box and get more of money. money out and there's some tokens and it was like yeah it kind of literally described a Ponzi scheme and he's like but you know the box at some point will provide value but for now the box it's the oblox podcast shout out to the odd lots podcast which i think i'm going to be on next week or this week or something sweet uh preschen let me know i said yes i don't have time to do the podcast because you and i have opinions i don't do it here but i like this outlots podcast um and uh yeah it was a pretty wild exchange where

people are yield farming and I was talking to somebody who's a high stakes poker player I wouldn't say his name but he stopped playing poker because he's making so money off this yield farming stuff and I was like can you explain it to me? He's like not really. They need money for liquidity. I give them money

they give me more money than I gave them and so it's more profitable than paying high stakes poker and I'm like one of the world's greatest high stakes poker players you've made well I want to say the number of because he could reveal it. But let's just say tens of millions of dollars

playing high-stakes poker around the world. Yeah. And he's just at a better table right now, but he'll be back at your table soon enough. He was at our table and we're having a good time. But he's like, yeah, just not playing as much poker. Because, you know, this is just too easy. I was like, okay.

Right. When the poker players are like, this is too easy, you know, the grinders who are playing people in Macau, it's a little bit of a, where's the old, uh, yeah, sorry. Need to unravel this. Oh, yes. Totally. Red flags, folks.

Red flags. Or, what else is in the news? Crypto people, please provide value. But it's good that they're stress testing. And I will say that. Well, yeah, exactly. We're going to figure out if there's value thanks to a bunch of dumb-dums. Well, also, like, things go down.

And their money, it's not our problem. Twitter, I mean, Facebook was born out of the fact that they couldn't keep MySpace and Friendster up and running. And they're like, oh, yeah, if we use this new software, we can keep it up running and, you know, Zuckerberg just stole their business. is out from under them because it was faster. Google search. Speed was like their number one way to increase usage, right?

Gmail, number one way they increased usage, they made it faster than other email programs. Superhuman, same thing. Make it faster, make it better. And stress tested and Twitter had the failwell for years, right? So Solana having their own fail well moment is fine. It means that there's something at stake and they'll figure it out, hopefully. I think the idea of like a currency that you can trade across borders,

There's a way to send remittances to people without banks taking giant gas fees, so to speak, all of that. Or even this idea of the blockchain Oracle, like a ground truth of data that can live on chain and not be faked. Like, there's a lot of business value there that will eventually be created. And what I think is happening on the other side right now is like a lot of noise that I'm going to try to understand this steep and then move on. Okay. That's my plan. We live in the future with today's startup of the day, Gravity Sketch, which makes a 3D design platform similar to how Figma is a 2D design platform.

So apparently the big problem it's solving is the process of taking a sketch, like, oh, I drew a sketch of how this building should look, and then converting it into a digital file in a team setting. Right. So I use Figma all the time now because the designers at inside.com that are building are you know, social news, you know, community and social network, uh, semi-figma designs and I look at them and I make notes on them. So it's a way to look at mock-ups of a website or an app, give commentary, iterate on them, see different versions.

So this is doing this for VR, I guess. Yeah, exactly. So you take a little sketch. So let's say like I had some landscaping work done, not that like a year ago or something, right? And you made this nice. It was just like a crayon-y sketch, like, and there's going to be a tree here and whatever. But if you could put that sketch, and then I put on a virtual reality headset

and then I walk through my awesome new landscape virtually. Here's my new kitchen. Then I would just be like, take my money. I mean, honestly, this would sell projects like crazy, I bet. Yeah. Let's see the video. Yeah, let's watch the video here and see what we're

working with. If you don't get the video version of the show, Spotify and has video now and Apple Podcasts has always had video, just search for this week and start it's video. And then you can go to YouTube dot com such this this weekend.

But let's keep the video. They have, while we're waiting for the video, 100,000 users, including the product design teams at Adidas, VW, and Reebok.

You could imagine doing pretty cool car design stuff here. The software is available for Oculus meta. It's got a four and a half out of five star rating with 99 rating.

So almost every customer has apparently, just kidding. And then it's London-based, recently raised a $33 million series A led by Excel. Okay, let's sports cathis.

Here is Joey, who's a footwear designer at footwear designer for Kanye. For Kanye. Mm-hmm. And he's sketching a pair of easies. Turning into a shoe. Yeah.

There you go. Easies are always unrecognizable as shoes. So that's why it's a little hard to tell this is going to turn into. I wear my easies and they're completely, Nick bought me a pair of easies. They're completely ugly. And I get so many compliments on them. And I look at them and I'm like, why do you people like these? These are ugly.

Every time I see somebody in like the world's weirdest looking shoe and I'm like, what has happened? Then my son's like, look, those easies. Okay, so now we're seeing also car sketch happening. So it literally is just like it's a pencil sketch. Right. And then boom, it turns into a concept car. Love it.

And then when it's a concept car, you're using your, I guess you're using the handles that you use with your quest, if you're using the quest from Oculus to then, you know, pull out the fenders, make crate flares, you know, like the Corvette has, you know, we can kind of flare out some air intents. or, you know, move the car around and make it longer or shorter. It's pretty interesting. I mean, I guess what this would do for businesses, too, is save them so much money in AutoCAD. Like, there's no, this takes out a whole entire art department for one thing. Yeah.

Well, I think. No, no, no. What it does is, I think it's different. What it does is it takes the principles who are involved in decisions and lets them collaborate in real time. So remember when you would have somebody would bring up, like write a word document printed out, go to a meeting, everybody's got their red pens, they make a bunch of edits,

and then somebody puts those back in the document. And then they're like, hey, you know what you could do is, we could all edit a document real time? And they're like, wait, what version do you have? You're like, no, there is no more versions. It's one living document, and I can see you in the document. And, you know, that's when, like, Google Doc's, real-time collaboration, I guess Zoho was one of the first to have that.

This is, you know, the designer's usually making this car, but the person who's the driver of the car or the CEO, or the cheap product officer or the C.O. You know, they don't get to go in there and edit unless they're over the shoulder. Here, everybody gets to edit, I guess, in real time or make notes on it. Or even see it develop in real time. So you cut out that long thing where it's like, we worked really hard and we used AutoCat and we made this thing. And then you present it to the CEO and they're like, hate it.

Yeah. I mean, this is what we do with. You hate it earlier. InVision and Figma are the two leading for web design where you can go in and watch the designer make the website. They're making different versions of it. and, you know, I'm always making notes about the copy or I make a note and I'm like, hey, this is three steps. Can you make it one step? So all I'm doing now with the inside.com social network that I made is trying to figure out

how to make every action one, you know, two ones, you know, if it's four steps, make it two. If it's two, make it one. And it just takes a whole, you have to change everybody's thinking because everybody's like, okay, yeah, step one, this, step two, step three. I'm like, are you using the site? Like, do you want to do three steps? Or can I just like have a button? So what I did was, I said, here's a list of our newsletters.

Just click subscribe. And they're like, yeah, put your email in. And then click subscribe. I'm like, no, you're already logged in. Just click subscribe. And they're like, okay, well, for events. And then they show me this like seven step events. I'm like, why don't you put RSVP for events?

They click RSVP. It sends them an email with the details of the event and then refreshes that little page and says add to your calendar or invite a friend and they're like oh wow that's genius i'm like is it isn't how old modern apps work but it's not how old modern apps work everybody makes things three steps yeah as we were talking about it's always been three steps so why change it or you try to do something comprehensive and like so there there could be legitimate like well what if i accidentally plus the rsvp button i'm like what if you did i'm like okay then just say you know on rsvp you know put that on the page or in the email say

If you don't want to come, click here. But, you know, like, let people run. Let people click things, you know, and making no steps. And then I, like, did the same for moderation. So for moderation, this is something I want to mock up for Elon and for the Twitter team. Like for bots, when somebody replies with a bot, it should just say, if the algorithm thinks it might be a bot, right? Because they reply to Elon or Jack or me with cryptocurrency giveaway. And it has cryptocurrency giveaway, Bitcoin.

giveaway, free, any of those words in it. It should just have a thing that says, is this a bot? Do you think this is a bot? And you're like, yes, definitely, probably don't know. You just have three words.

Now, you're scrolling through, it costs nothing for a human to click, definitely. And, you know, you get three definitelys. It goes, it gets turned off, it goes to review, it gets paused, whatever, shadow band, whatever.

Or it collapses and says, Three people reported this as bots. And you can unclic it or the person can say, you know, whatever, appeal that they're not a bot. It would be a lot easier. You know, all the, and then when you report something, I don't, did you give up on reporting tweets on Twitter? Ages ago. See, I think that the Twitter team was like, you know, it would be good if you did all the work. Right.

And they're like, well, I'm not doing that. Report. You know, like click the hamburger, you know, three dots. Click report. Who are you reporting for me, somebody else? Who are you? What is this? How much is this?

you want to block them. It's just like, do you want me to email you later and we can talk about this? I'm just like, it's eight steps. Should I send the cops to your house? Right. Like, no. It's eight steps. Eight steps too many.

You should be able to report it and it should just say, um, report and block. You hit report and block. It's reported and blocked. And then it says, would you like to give us more information? So you can one click report and block. Now you know just how many people reported and blocked it? A hundred. And then six of them.

You don't need everybody to put the details in, but there's six maniacs to put the, the details in, just like Wikipedia. So they're just not thinking through the user experience of how to make things simpler for users. So on my system, when I'm building an inside is, and I'm testing it with our internal people, if you see somebody report something, if you go to inside.com slash new, you can see this.

If it's self-promotional, you just click report and it shows you five report types, spam, low-quality source, duplicate, self-promotional. And so when I'm on the site, I'm just like, beep. Self-promotional. Beep, self-promotional. We're not, you're not supposed to submit your own stories. Kind of, or, you know, bull-h like press releases or spam. And so I'm just like, boop.

Self-promotion. And then it puts a flag on it, it's self-promotional. And now people can see on your profile that you submitted something self-promotional. And then that makes you not do it again. So imagine if on your profile, name and showed, well, consequences. You know, it's like, so if it showed on your profile reported for harassment or suspended for harassment on this date, you could click it and you could see, here's why you were supported for harassment on Twitter, and here's your response to it, and here's how many people reported

your harassment, and for what tweet? Like, that'd be pretty great. Like, if people supported, it reported me for harassment for doing my, uh, you know, um, tweet with somebody sent me images of me and Sacks and broke back mountain and I was like, this is pretty hilarious. Uh, if somebody was like, oh my God, Sachs was like, you harassed me for that. I'd be like, okay, great you know like I was reporting you can actually see it that's the problem and I I did that did you do that shadow banning thing to see if you've been shadow banned the Twitter website no so it turns out like some of my replies are been shadow banning well I follow a lot of people um so I think it's like if you replies to you no I reply to other people or shadow banned yeah so if I reply to

people it's what you're saying they found examples of my replies not coming up in other people's threads, which is like a light shadow ban. It's like, you can still see my stuff if you follow me, but if I reply to some high-profile person, maybe people don't see. Hmm. This is the kind of weird stuff that should be just, you should all know about. Yeah. Yeah, it should just be transparent because all it's doing is creating this culture of like,

you know, oh, they're banning the libs. They're banning the right wing. They're banning this group. They're banning that group. It's just like, just make it transparent. Like, just let people know and let the person know that they've been banned or reported. I think that's part of the Telling you, I think this is why Reddit works

and why Wikipedia works. Like you have, first of all, with the Wikipedia, you have an army of editors who care about, you have transparency. Every edit is on the record. You have an army of people who only care about the truth. And on Reddit, you have upvoting and downvoting. Like you have community level moderation,

which is all, you know, at some point, we just all want to be like, this guy's an a little get rid of them. Yeah. Let us do that. Yeah. I don't know. Assuming we know it's a real person and not a bot.

And then once that's solved. They have downvoting. on, I know they were experimenting with downvoting on Twitter. I think the downvote on Twitter. I think they decided it's negative. And that's, I don't like that. I think YouTube made a mistake too.

Like, oh yeah, there's nothing else negative going on there. Like, give me a, I like the downvotes on YouTube. It was like a great signal. I know that could be like bullying. And then use it as a signal to the algorithm and not bullying. And like it's, I don't know. Yeah. I like the downvoting on YouTube.

I like to see on my videos, which ones were downvoted. I do like downvoting with, transparency. So if you down, maybe the solution is if you downvote, you have to put your name on it. Yeah. Because that's kind of cool. That could work. I'm going to add that to, I'm going to add that to inside where you downvote and your name's on it. And you can see you downvoted. Yeah. Yeah. Oh, really? So if you downvoted it, you had the option to say, right. Right. I think it's a low quality news source or self-promotional or, or, yeah. Okay. Somebody make them and take a memo. Remind me of that. It's a good.

idea. We're doing a little product design here at the end of the show. In real time, like you do. We got a big week, a lot of news. So stick with us and we'll see you on the next episode tomorrow.