This Week in Startups - Education’s war on excellence, AWS atrophy, France fines Google + AppHarvest’s Josh Lessing | E1245

Episode Date: July 14, 2021

Jason covers the war on excellence in public education (2:05), signs of AWS maturity (19:04), France's $592M antitrust fine for Google (30:28). Then discusses AI Farms with AppHarvest CTO Josh Lessing (47:43) covering building with robots (1:16:03), improved crop yields (1:24:43), climate change & more.

We got a great show for you today. We have App Harvest CTO and former Root AI CEO and founder Josh, lessing on the show to discuss robotics and farming, climate change as an accelerant for sustainable solutions, and raising money by my syndicate. We were able to invest in Root AI in less than a year. They got bought by App Harvest, providing a multiple on our investment in a year.

Amazing. And now we have these shares in a public company. Absolutely fantastic. But first, before we get to that interview, we have a handful of great news stories. Public education bureaucrats in California, Virginia are killing excellence in our schools, especially in the STEM area, science, technology, engineering, and math. And AWS is dealing with bureaucracy issues inside of their company like Apple has recently faced.

And Google is just fined half a billion dollars by France due to not being able to negotiate with publishers for the rights to indexing. their new stories. Plus, I'm going to talk about some products and services that I am interested in right now, including a license plate reader. Stick with us. This week in startups is brought to you by Fundrise provides access to diversified portfolios of private real estate to all investors with their industry leading, easy to use platform. Sign up today at funrise.com slash twist. That's F-U-N-D-R-I-S-E dot com slash Twist. 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-C-R-WD.com slash twist. And in

Brokers Startup Insurance Program helps startup secure the most important types of insurance at a lower cost and with less hassle. Save up to 20% off traditional insurance today. at inbroker.com slash twist. While you're there, get an extra 10% off by using offer code twist. Okay, in our first news story, I want to talk about killing excellence in public schools. We've seen this story come up a bunch. Now, what does this have to do with this week in startups? Well, we are an industry built on excellence. And in some cases, people in science and STEM math doing extremely well and then starting companies. But this is an overall story that I think is really important because it goes to the heart of America and what America is about, which is

a meritocracy, a competition of ideas, a competition of performance, and people striving. And what's happening right now in our public school systems is really tragic. We're trying to take competition and excellence and rewards and meritocracy out of the public school system, and it is going to be a disaster for this country, according to almost any logical person. So let's break down this story and talk about it because I think it's super important. There are two stories here to cover. One's in California. One's in Virginia. And you've probably heard of the California one. You might not have heard of the Virginia one, which I think is actually more interesting. Both of these are along the lines of addressing inequity, not inequality, inequity.

And doing so by lowering public school standards. Now, you remember what my bestie Chmott said on the All In podcast, and I'm just quoting him, when you hear a public official tout the phrase, in equity, run for the hills. In May of 2020, California's Department of Education drafted a new framework for K-12 math education. Now, according to an article in Reason.com, which we'll link to in the show notes, and I'm quoting here, the draft of the framework is hundreds of pages long and covers a wide range of topics, but its overriding concern is inequity. So here's the quote from the article.

The department is worried that too many students are sorted into different math tracks based on their natural abilities, which leads some to take calculus by their senior year of high school while others don't make it past algebra. I would be in that latter group, shockingly. I was an underperformer in school. They literally wrote on every report card,

you know, performing below his ability. And obviously, since then, I've corrected that and tried to perform above my ability, but I had a rough start. But even with my rough start, not getting to calculus, I never dreamed that the kids who did apply themselves should not get to take.

calculus. California's solution is prohibiting sorting until high school. In other words, I want to keep gifted kids in the same class as everyone else until at least ninth grade. Now, if any of you went to school in America who are listening to me public school, which I am a product of the public school system until eighth grade when I was getting kicked out of public school, I went to private school, because I got in too many fights, shocking. The idea that people would not be in a track with other kids who are at their performance levels means you're going to have smart

kids sitting in class who are going to be super bored and then you're going to have a group of kids who are slowing them down who are going to feel super guilty about slowing them down. This framework is claiming that learning calculus in high school is overrated, especially for gifted students. This is ridiculous. Obviously, learning high-end math and physics and these concepts leads to people having the ability to think in incredible ways and to push the end. envelope for humanity. A lot of the great entrepreneurs I know came from math, calculus backgrounds,

and physics backgrounds. Not because those things necessarily apply, but because that type of thinking allows you to think critically about systems and architectures and how to deploy solutions in the real world. Let's put a pin in that for now. Here are some quotes from the framework. And you've really got to pay attention here because it's really subtle and pernicious. Here's the first question. All students deserve powerful mathematics. Okay, we agree with that. We reject ideas of natural gifts and talents. Wait, what?

Okay, we agree. First part of the sentence, all students deserve powerful mathematics. Sure. But we reject the idea of natural gifts and talents. Have these people ever been in a classroom or worked with children before? Of course there are people with natural gifts and talents. There is such a range inhumanity of gifts and talents. across human beings that it's actually one of the most delightful things about the human species

is that some people can sing and others can dance. Other people can run a four-minute mile or five-minute miles. Some are good at martial arts. Others are good at mathematics. Viva deference. We do not need to accept this idea that there are not natural gifts and talents. Of course there are natural gifts and talents. An important goal of this framework is to replace ideas, I'm quoting here, of innate mathematics,

talent and giftedness with the recognition that every student is on a growth pathway. Hold on a second. They just said, we reject the ideas of natural gifts and talents, and then they say, with the recognition that every student is on a growth pathway. Okay, wait a second. If students are on a growth pathway, they're on different parts of that pathway, that would mean that there are natural gifts and talents that put them somewhere on that pathway. some people might be further along in that pathway.

I am not going to be dunking a basketball at 5, 8 and a half to the ease at which Christop's Porzingis at 7.3 is going to be dunking a basketball, and that's okay. That's okay. And there are some people who are just great and have the brain chemistry or the aptitude or the motivation to become great at chess, whatever it is. And people can debate nature, nurture, or any number of factors. But we're saying in one sentence that there is, we're rejecting the idea of natural talents and gifts while saying everybody's on their own growth pathway.

Another quote, there is no cutoff determining when one child is gifted or another is not. It's completely wrong. Of course, there's a cutoff. You can look at performance. And you can say, at this age, this person is in this percentile of math. I have children when we go to school for their yearly or, you know, every six months. and we check in on how they're progressing, they literally have designed if your child is doing math at this level or has a vocabulary at this level or spelling at this level or penmanship at this

level, they are in this part of the bell curve in terms of, you know, they're in the top 4% of verbal ability or they're in the bottom third of mathematics. This is nuts. Who's running the California Department of Education? I'm in California and I'm in a public school and literally we look at these bell curves and they tell you where your child is so that you can do an intervention. What kind of society are we trying to create here? One where everybody is the same? That's not a good goal. We want people to be different and to flourish and to pursue their natural gifts. One of the great things about humanity is that different people can specialize and perform at different levels. Now, in a related news story, in yesterday's Wall Street Journal,

opinion page in an article published by William McGurne, who is a Wall Street Journal editorial board member, former chief speechwriter for George W. Bush, the article titled A PTA purge of Asians. America's top public high school shows us what discrimination looks like today. For background, this is about Thomas Jefferson High School for Science and Technology in Virginia, which is a school for gifted children, students. And they refer to it as T.J. Thomas Jefferson High. It's America's number one ranked public high school by U.S. News and World Report. So we are ranking the schools, but we don't want to rank the students. Okay, at least California doesn't. Now, in this article, in December 2020, I'm quoting the county school

board changed its admission process, replacing a rigorous race-blind entrance exam with a holistic read subjective formula that included grades, but also put caps on the number of students each middle school could send to TJ. Hmm. Okay. A de facto limit on middle schools with high numbers of Asian American students. In other words, they're putting a throttle on this community, taking all the slots in this number one school. The desired result has been achieved. Again, I'm quoting, the percentage of Asian Americans admitted to TJ dropped to 54% this year from 73% last year. Whites, blacks, and Latinos, all sort of their numbers go up. So, again, in March, a group of concerned parents called the Coalition for T.J. sued,

claiming the new policy violates equal protection rights guaranteed by the 14th Amendment. Pretty obvious that it does. Based on the color of their skin, they are not allowed into the school based on their ethnic origin and their ethnicity. They're specifically being targeted by this. Pretty obvious. And it's not the first time we've seen this anti-Asian American or anti-Indian approach to education. It's very interesting that those two, minority groups are getting treated this way, and people are not up in arms about it. In May,

they won a victory when a federal judge refused to dismiss their lawsuits. Everyone knows the policy is not race neutral, and that it's designed to affect the racial composition of school judge Claude Hilton said. I mean, it would be intellectually dishonest to say it does not, of course. One of the coalition members running for PTA is Harry Jackson, a retired Navy officer who's black and whose son is a sophomore at T.J. High. Jackson wrote an opinion, for the Washington Post in March where he explained his position. When I see the effort to water down the admission standards to T.J., and let's be clear, that effort is largely led by paternalistic white liberals

who are determined to help, in quotes, minority victims at any cost, I see it for what it is. A tacit admission that they don't think black and Hispanic students have what it takes to compete on merit. And this is, I think, how a lot of people feel that this white liberal movement is trying to lower standards. maybe the people who they're trying to help don't want their help. More quotes from Jackson's piece, the student body is notably diverse with 79% coming from a minority background. But

according to state and local education bureaucrats, that last point isn't good enough. Because as it turns out, and I'm quoting here, the school's population is made up of the wrong kind of minorities, Asian students. To be clear, again quoting, as an African American father of a TJ student, I would also like to see more blacks and Hispanic students at the school. But if those standards are not making the grade, the problem isn't the standards. It's more likely the elementary school pipeline is failing to prepare them for the rigors of an environment like T.J. But rather than address the very real failures at preparing underprivileged students, Brad Band and his cronies now seek to gut the admission standards to get the racial balance they deem appropriate.

Brab Rand is a reference to the Fairfax County Public School Superintendent Scott Brab Rand, who led the charge to water down the emission standards for T. In other words, we're failing up until eighth grade to prepare these students to compete for these slots. Therefore, we're going to change the admissions to that school and lower the standards. When we should actually be saying, let's demand more of our teachers, let's demand more of our administrators, let's demand more of our education system, let's invest more, let's have after-school programs if we need to, let's have tutoring one-on-one sessions that people could opt into. Why on earth would we throttle high performers in order to not focus the blame where it belongs?

If we are not preparing people early enough, let's go there and do some work there. You do not need to lower the standards on the back end where people are taking calculus and going to, based on merit, the number one public high school. And Gary Tan, friend of the podcast here, who is a product of California's advanced math classes, and who is an entrepreneur-turned-in-investor, and who is Asian-American. He recently tweeted about this article, we must improve access by black and Latino families to better K-8 school resources to lift achievement by high school age.

The answer shouldn't be an unjust shortcut eliminating elite guilt over racial achievement gaps by eliminating the tests that expose them. Think about that. There's a really well-put. There is a war against testing, against merit, against excellence. It is what cuts down on social mobility. Without access to advanced math or the SATs, I would have never escaped my working class childhood. We kill the ladder up if we allow ideologues to burn down merit.

And this is absolutely the case. The teachers' union and the education bureaucrats are way too powerful, and they're setting us down the wrong path. And we must stop them. And we must keep America competitive because our contemporaries and our competitors in the world, the communists in China and other places. is, they are not thinking in this insane way that we don't want to have excellence. They're thinking, how do we have more excellence? They're thinking, how do we push people harder to achieve more, to solve society's problems

more, to play a bigger role on this planet we call Earth? Now, this sounds incredibly hyperbolic, but the human species is at a crossroads. The human species is at a crossroads right now. the communists in China are going to win or the West. The democracies are going to win. And the way we will win is by having the greatest education system in the world that motivates and drives people to achieve more and more specifically in the areas of math, science, engineering.

This is where technology, the future is at stake. and we're literally going to hand it to a bunch of communists in China who absolutely have no problem with putting people on different tracks based on how they perform. And we want to remove performance. We need to be doing the opposite. We need to be looking at the full stack of education every single grade, every single school, every single student

and saying, how do we create a more competitive environment in education? We don't have competition in education. We need to have massive competition in education and the parents need to demand it. Whether it's privileged students or it's underprivileged students and parents who are fighting here in San Francisco against an insane board of education. But let's not damage the next generation by removing standards. Let's inspire them to achieve and reward them for doing so and give them every chance to live an excellent, awesome life with performance and, competition at the core of that. They need to perform and compete. That's the world. If you're a parent, what are we all doing as parents? We're preparing our kids to inherit this planet and to compete

to make it better and solve the world's most important problems, not to be average. Does anybody out there aspire to have their child be average? Or do we aspire for our children to compete and to be excellent? We want all of them to be excellent. And that's not at the cost of anybody else. that's our that's our choice and that's our mission as parents is to give our kids whatever opportunity they want and to push them to achieve so anyway i'm sorry i'm infuriated by all this that's the end of my rant studies have shown that a truly diversified portfolio needs more than the traditional mix of stocks bonds and mutual funds it should also have some exposure to private real estate studies have shown that portfolios with an allocation to private real estate generally

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Go to funerize.com slash twist. That's F-U-N-D-R-I-I-I-R-I-E-E-R-I. ISE.com slash twist, Funrise.com slash twist. Let's go on in the news. Amazon Web Services and their new CEO are facing a lot of bureaucratic challenges. For some context,

Amazon's web service, AWS, which is Amazon's cloud computing platform, is at the core of Amazon's profits, just taking a look at the numbers. AWS, Amazon's web services. This is not you buying books from them. This is their server farm, which they rent out to

startups and big companies. They're on a 54 billion run rate in 2021. This is extraordinary. In 2020, AWS was only 11.5% of Amazon's total revenue, $45 billion for AWS and $386 billion in total for Amazon, and including Amazon Web Services. However, AWS accounted for 63% of Amazon's net income in 2020. In other words, it's highly profitable. Amazon's net income was $21 billion in 2020.

AWS's was 13.5. So let that sink in. This giant business they have of selling books and third-party products and cables is modestly profitable. But AWS has a massive ability to print money.

And that makes total sense. One is delivering books at a very low margin in other products and one is providing scalable computing and software platforms that have just a tremendous margin built in. AWS is the top provider

of cloud computing, in the world, accounting for over 40% of worldwide public cloud infrastructure, according Gartner. AWS recently hired Adam Salypsky as CEO to replace Andy Jassy, who is replacing Bezos as Amazon CEO, which is in itself very instructive. The former CEO of AWS is now the CEO of all of Amazon. Solipski was a VP of sales and then CEO of Amazon Web Services from 2005 to 2016 before leaving to be the CEO of Tablo, a position he held until 2021. In other words, AWS won the day at Amazon,

and they're running the show at Amazon. According to an article published yesterday by the information, Solepsky might be returning to a different company than he left. According to the information, preventing AWS from sliding into the bureaucratic sludge that has mirrored so many large information technology companies is likely to be one of the top challenges for Solepsky. Under Jesse, AWS was run as a startup inside of Amazon. with a frenetic pace of new product and feature releases. Anybody who's in tech knows that they just kept releasing every possible service as an API. And as it's reached this massive scale, it's become more difficult to keep up the pace

and to limit bureaucracy, according to this article. The quote, although the number of employees is a closely guarded secret, more than 75,000 people listed AWS as their current employer on LinkedIn, making it roughly the size of Cisco systems, the 36-year-old computer networking giant. In other words, this is a huge, huge group of people working on this. Greg, Pearson, a long time Intel executive, join AJ Abbas in 2019 as a VP of American sales. And according to four anonymous sources that previously worked at AWS, Pearson brought in a culture of much more paperwork filing and administrative work, turning off some of the salespeople that enjoy to start up like culture at AWS under Annie Jassy. This is typical. You know, the bureaucrats come in and they bring their systems from the previous company and the pirates, you know, and samurai running the previous, you know, in a previous style are now

being replaced with bureaucrats. However, other employees cited a need for more scalable structure at ABUS, which has resulted in incredible revenue growth over the past few years. 2018, 25 billion. 2019, 35 billion. They added 10 billion. 2020, they add another 10 billion, 45 billion. And in 2021, they're on that again, adding 9 billion, 54 billion run rate. So every year, consistently they're adding 10 billion. Now, as a percentage of revenue, obviously adding 10 billion to 25 is a 40% increase, and adding 10 to 45 billion is only in the neighborhood of a 20% increase. So, you know, the percentage is slowing down, but the raw number is still a very large number.

And if the infrastructure is largely staying the same, that means the profits are going up. In other words, they probably, if they're adding $10 billion to their run rate and revenue, are not adding $10 billion in expense every year. They're probably adding a fraction of that. And that's the scale and the beauty of running a software business or even a cloud business, which has some infrastructure costs. It's not fixed cost exactly in that, you know, when you create a piece of software, if you create Slack, it's largely a fixed cost business.

It's in it. You write the software. You have 500 developers writing the software. If a thousand companies use it or a million companies use it, probably doesn't change the number of engineers you have. It may change on the margins. how much bandwidth you use. But those are de minimis costs in the grand scheme of things.

So how can companies like Apple, Google, Amazon, and others maintain a strong pace of innovation while still managing tens of millions of employees? Is it even possible? Well, in episode 37, we broke down Antonio Garcia-Martinez's substack article, Bad Apple about Apple's lack of innovation and crippling bureaucracy. Here's a two-minute clip. But I thought his most salient point was Steve Jobs would not have been able to exist in the Apple that exists today.

He would have gone run out of Apple is what he said. He would have been cancelled. How much innovation is there really at Apple now that the genius who created it is gone? And he ends his article by saying, when Apple launched the Mac computer in 1984, you know, they famously ran that Super Bowl ad that featured a solitary figure flinging a sledgehammer into a big brother-like face spewing propaganda at the huddled ranks of some drab dystopia. And then AGM says the tech titans nowadays. resemble more and more the harangue figure on the screen rather than the colorful rebel going

against the established order, whether it be hiring policy or free speech, Silicon Valley has to decide whether it becomes what it once vowed to destroy. The reality is the great genius who founded Apple is long gone. It is run by HR people and woke mocks. It's run by a supply chain manager. Exactly. And so there is no more innovation there. They are just a gatekeeper collecting rents and, you know, Freeburger, you're right to raise the issue of what's going to create the most innovation. But the thing that's going to create the most innovation is letting entrepreneurs create new companies without needing Apple's permission. I will tell you something. I think that over the next decade, because of exactly what you guys said, that Apple is run

by managers who don't want to see loss, but aren't driven to gain, you're going to end up seeing Amazon particular and Apple likely as well lose to the likes of Shopify and Square and Stripe. Shopify Square and Stripe are all formidable threats to Amazon over time. And now that Bezos is actually going to step out, and it is going to be run by a bunch of managers, and you have these founders of these three companies still running all three of those businesses, and all three of those businesses are going to be incredible competitive threats from different angles on Amazon. That is where innovation win. So if you look at Freeburgs Point, Shopify Square and Stripe, these are incredible companies with incredible momentum and is

AWS going to be able to compete on payments or for e-commerce platforms with Strives, Shopify, and Square? Probably not. And what if those companies start adding other cloud services? We're going to be in for a dogfight here and that's one of the great things about our industry. It's just a little

bit weird for us growing up on Google and Amazon and Facebook and Apple to start thinking about another set of companies disrupting them. But Microsoft and IBM were in fact disrupted by Google and Amazon. So it's one of the great things about our industry. In terms of founder authority, which I talk about a lot, now that Bezos is out of Amazon just this past week, you know,

Amazon has lost that founder authority, which means things are going to change. People are not going to make as many bold bets because they will be thinking about losing their job. When you're the hired gun CEO, whether you're Sundar or you're Tim Cook or, you know, Amazon's new CEO, you don't have the founder authority to say, I'm going to do this, this is my company, I named this company, I hired the first 10 employees, this is mine.

I have founder shares, and everybody is going to have to deal with my decisions, even if they're mercurial, even if they're quixotic, even if they seem insane and bold. But Apple, as Sachs joked, is run by a bunch of HR managers, and that might be why,

let's be honest, the best product they've produced at Apple in the last 10 years since Tim Cook's been running it, probably AirPods. And I'll be honest, AirPods now, I don't know if you've tried pixels, earbuds, whatever they're called, the pixel version from Google, they're kind of better.

In fact, they're much better. And they're $99. So I think, you know, those mean Apple's not going to be a great company and not going to print money. But I do think if you're looking at Apple for massive innovation and risk-taking, you're not going to get that when they're run

by a supply chain manager. Literally, Apple is run by the supply chain manager, Tim Cook. Now, that is not a dig to Tim Cook. Tim Cook is a lot of the reason why Apple was able to hit incredible scale. But, you know, where's their AR glasses? Where's their new car?

You know, where's the new, you know, incredible product? The new IMac, yeah, it's not. nice, and the M1 chip, pretty innovative. You know, this stuff is great, but you don't see the bold bets that we would be looking for. You're not going to see a cyber truck, which now has a million reservations. You're not going to see, you know, an AWS launch inside of Amazon again, I don't think. And that's okay.

You can manage these companies to excellence defined as printing money, not defined as changing the world with new products and services. And that's okay. Okay, it's time for another R crowd deal of the week. Right now, you can join our crowd's investment in Ripple. According to the deal memo, Ripple is an established innovator in the rapidly growing multi-billion dollar dairy alternative market. Ripple offers alternatives to milk, protein shakes, creamer, and more with proprietary tech

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France's competition regulator find Google 500 million euros, almost 600 million US dollars on Tuesday for failing to negotiate in good faith with French publishers in a dispute over payment for their news. The agency threatened fines of another 900,000 euros around a million bucks per day if Google doesn't come up with proposals within two months on how it will compensate publishers and news agencies for their content. Google had $182 billion in revenue in 2020, so paying a fine of a million dollars a day is not a big deal. What they would more likely do is stop Google news inside of France. This is the second largest antitrust penalty ever in France. The largest was an Apple fine of 1.1 billion euros,

where Apple was accused of working with wholesale distributors to divide up customers and not compete. Google's fine is the second major one. They've received this month in France. Earlier in July, Google settled a $270 million fine for favoring its own ad auction platform. So this idea that Google is giving preferential treatment to their ad auction or their Yelp competitor,

you know, Google Local, or Google, flights or Google shopping, each country is going to come up with their own concept of what's allowed. And I think what you'll see is companies like Google, just like Facebook threatened to not allow the publishing of news stories from France. I'm sorry, news stories from Australia to their social network and that freaked everybody out in Australia. You're going to just see these big tech companies just say,

fine, we'll do it your way. We will no longer index LeMont in Google, news, et cetera. I do think that Google News, that's great, publishers article and curate them into a feed, that should be a licensed product. And I think Google should just come up with something fair for this. If you're going to show, you know, a snippet of a news article and increasingly Google will use AI to pick the most important information in that article and then represent it,

why not just come up with a fair CPM, a cost per thousand views for that? as opposed to just taking it. And supposedly Facebook has paid off New York Times with some payments for their content. People don't like to talk about that. But that might be, I think, an eight-figure deal. And it might be people say why Facebook hasn't been treated as difficultly by the New York Times. I don't know if that's actually correct. But, you know, I went through this myself running Mahalo where I created a comprehensive search engine built by humans.

was kind of Wikipedia plus Google search. And Google just took us out of indexed. Google does not play fairly. They have sharp elbows and they will fight and they'll win in most cases. And if they get a speeding ticket like this, so be it. I mean, that's the way they look at it. It's a total black box. They will not tell you what's happening.

And Ruben Murdoch, you know, from Fox kind of got this right. He pushed Australia and he pushed France and other folks to really pay attention to this. because Google makes a lot of money selling ads and not giving publishers a cut on Google sites. And Google will say, well, you can just not index us. And that's kind of a jerk move. We want to be indexed. We just don't want you to take the snippet.

So there should be some middle ground here. And Google's going to have to really figure out a fair way to mitigate this. It's the same stuff that happened in Australia, where Facebook and Google were told they need to compensate publishers for news. And Google is compliant. They agreed to pay nine Entertainment Co, one of Australia's largest publishers, more than 30 million in cash annually for use of his news content. So, uh, taking the other side of this is a tech blogger Benedict Evans, who worked at

Indy San Horowitz for a bit. He says, the shakedown continues. It's hard to see how making tech companies pretend to buy something that has little to no economic value to them is a path sustainable business model for newspapers. If you want a tax and a subsidy, be honest, and call it that. I think it's fine to call that a tax. If you want to index that content, and it does provide value. It just may not provide value directly. So Benedict does. wrong there. You know, if you're, I think that's why Google News and Google Images don't have ads on them. The second they put ads on Google images or Google News, those two specific services on Google, then you would be able to make this very direct connection. How much money

do Google News make? How much money do Google Images make? Instead, what they say is, we're just indexing, we're just indexing. We're not actually publishing the content. We're just pointing to it. And then you do a Google search because you're on their site, so they get the revenue through the secondary usage of their service. In other words, it'd be like getting, it'd be like me playing a movie, a television show for free in a movie theater and then making money off the popcorn, right?

Kind of what's happening here. Somebody is like, hey, we're playing these movies in the movie theaters, but, oh, we don't get any value from that. We gave the tickets away for free. But if you look over here, you know, we are sold the popcorn in the front of the movie theater.

That's a better analogy for me. And so separately, in the U.S., Google is being sued by 36 states right now, alleging that Google is a favoring its Play App Store on Android and removing other options for app developers to distribute on the platform and then charging. What some people consider a high fee of 30%,

which I don't consider that high of a fee because I remembered in the package software days, you know, you would sell your chess master game to, you know, a computer store for $25 and they would sell for $50. So you really were playing 50% in retail or maybe you were getting paid even less.

But this is, is going to be the trend. If you're only allowing software onto your platform through an app store, like iOS or Android, I think that's going to be a trigger for this antitrust regulators, and there's a very easy way to solve it. Just allow people to click on a button to allow third-party app stores, and then you can say, we're not going to support your phone if you allow other rogue apps on here. So don't come to us for customer support. If you're using your iPhone and you start loading apps from some Chinese app store or some Russian app store

has stolen apps in it. It will become the Wild West. The second you can put any app store on people's phones, it'll become like BitTorrent or spam or viruses. Your phone will get hacked. There'll be nobody reviewing those apps.

They'll be filled with, you know, all kinds of fishing scams and data scams turning on your camera maybe and uploading everything from your photo album to their servers and then doing ransomware. I mean, you would have to be. be a fool to load some rogue app store because once they have your access to your phone, they've got everything, every photo, every location.

I mean, it could get pretty gnarly. And that's why spy agencies love, love, love people having this device in their pockets. Because once they root it and they get their claws into your phone, they can turn the microphone, etc. You think that this is me sounding like a crazy conspiracy theorist? This is state of the art, espionage. This is how it all works today. you can have the Russians, the Saudis, etc., hacking high-target individuals like Jeff Bezos's

phone with all kinds of software. And if you allow other app stores where the apps are not reviewed, you are going to get demolished. You are going to have all your data stolen. I would never, ever do that? Now, do I want the ability to load an app from one of my, you know, investments, you know, through test flight or maybe just at least have the option to do that? Maybe, maybe I would want that, but I have security concerns. I kind of like the idea that the App Store is throttling the number of apps on my phone and doing some curation because I would like it to be safe

and I would like my kids, iPads, to be safe. But people have a lot of different. Some people want their phones to work like their desktop computers where if you want to, on your Windows machine or your Mac, to load some piece of software that roots your machine and, you know, does God knows what? Maybe record your keystrokes, you can go do it. God bless you.

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twist. Please put in the offer code twist so they know that I sent you. Okay, let's get back to this amazing episode. Before we get to the interview today, just wanted to give a shout out to a product I love. I'm holding up right here. These are anchors, mag safe adapters for my iPhone 12. As you know, the iPhone has a magnet on the back. Boom, you put this on here. You press this little button, and you're now charging your phone. This has been a godsend for me. That's why I own two of them. I've started traveling again. I get these two things charged. And then when I'm using my phone on airplane or I'm in an Uber. I just pop this on and I keep my phone at 100 all day long, which is just a great feeling. It really does because it attaches to the back of your phone.

It's no big deal. You don't have to actually plug it in. It's so fast and so easy. It's so great that Apple is now releasing one. Anchors, I think, will always be better. Anchor is just this great company that I buy every new product. This is how crazy I am about Anchor's products. I go to the Amazon Anchor store and I look at what's new. and I just buy whatever's new. They have like a new nano, I think it's a 60 watt charger, and I just buy whatever the newest thing they make is.

I don't know why I'm so into accessories for electronics, but it's my Engadgety's coming back. But this MagSafe battery pack from Apple, this will be coming July 19th. I also have from Anchor, my friends at Anchor, this stand, which you can put your phone on, and on your desk, you can be charging and looking at your phone. It's quite delightful.

And then it comes to the little pad, here. So I have my pixel buds, which also are not mag-safe. So it's not going to, oh, actually has a little bit of a magnet. It might kind of falls off. But this little stand here is also, allows you to charge. So when you plug it in, it's charging here. So you can plug in your phone. And pixel buds, much better than anything from Apple. In fact, just to show you how great these are, when you put these pixel buds, which are only 99 bucks in your ear, you just twist them in. You don't even see them. Look how flush they are. So when you're sleeping, listening to this startups and all in, you just go to bed and you just lay down and you don't even forget,

you forget you have these in. I wake up with these sometimes. They obviously turn off when you're not using them. But pixel buds, 99 bucks. Anchor battery pack, no brain or Mac safe. I'll try the Apple one, but I'm kind of loyal to anchor. And then this anchor stand, they're not paying for this. I just thought it would be interesting on this podcast to tell you the products I love.

You can tell me the products you love on Twitter or Jason at Calicanus.com and maybe I'll promote them here. Maybe we'll start doing unboxing videos here. Another product I'm researching that I think is really great is I've been thinking about safety for neighborhoods, especially with San Francisco where I no longer live, but I do have a property in San Francisco that we have our office in right now. It's like a live work loft I have. I may sell it if I move to Austin or Miami, but I still have it.

And one of the things I've been thinking about is private communities and what do they call those gated communities. I've always wondered about those. I've been fascinated. As a kid from Brooklyn, the first time I saw one in New Jersey, I was like, this is crazy. Like, your community has a gate? And they're like, yeah, are you dumb? Like, have you never been out in the real world?

I'm like, no, I haven't. I'm from Brooklyn. I thought everybody lived on a block with, you know, the houses in row houses next to each other. I never knew people had backyards and parking spaces and, you know, this kind of thing. But I did some research on this, and I found there's an API and an open source project for license plate reading, because we had a bunch of burglaries in the, area where I live today. And the way they found them was, it was the same car coming in and doing afternoon, you know, afternoon, you know, run into people's houses and take their laptop kind of

situation. Don't do that on my house. I have a gun and security. So it would not be a good move. But people were doing this in our little community. And so I was just thinking like, why are we not, I wonder if we should be a gated community or, you know, if they ever thought about that. And I was thinking about license plates because license plates are public information, right? and, you know, they're just, they're out there in the public. But license plates, if you were to know in my community, if I lived in, you know, this community on the north shore of Kauai, and there's one road in and one road out or a limited number of roads, if you had just a camera there and you had people's license plates,

you could make a database of every time somebody came in and out, and if that license plate hadn't been recognized before, it could send an alert that there's a license plate in the community that has never been there before. Now, this is super Orwelly, and I thought, wow, this is really interesting. I wonder if there's obviously privacy concerns, but it's public information. And there's an API to do this.

And then I found this company, flock safety.com, and they make a device for $2,500 a year. I got in touch with them. I haven't bought it, but I just thought I would share it with you that I've been doing this research because I've been thinking about safety.

You know, when you have a family, start thinking about that, when you have a home, you start thinking about that when you see what's happening in San Francisco. And then I'm also into privacy, and I was wondering if this product existed, and it does. They've created a camera system with a giant battery in it and a 5G connection, and you can plop it on your property. Now, if your property happens to be near a street and you have a driveway, you can put it in your driveway, and every car that goes by, you can personally record every single license plate to make a database and know when your neighbors are leaving their house

and when they come home, as well as every other license plate, and then if there was a robbery, you could say there was a robbery on our block, there was a break-in, here's every license plate that came in and out not just that day, but here's the pattern of every single one

for the last year or 10. And then I thought, I wonder if you could just upload a video on some regular basis from a Ness camp, and then I thought, well, why does Ness just add this? Because Nest has an outdoor camp. And then I was wondering, well, if that's the case, what if Tesla built this into their cameras?

And when you're driving down the road, it records every license plate, or if there was an app and you put your phone on your dashboard, you could be recording all this. And then I just came to this conclusion, like, wow, our privacy is an illusion. People are actually doing this in the real world already. And if you go to Flock Safety's website, you will see videos of them catching people based on their license plate.

This is the world we live in today. This is why a lot of criminals are taking their license plates off when they do hit runs in San Francisco because they know the license plate might tag them. But this software also tells you the color of the car and the model. And obviously, if you're getting the license plate,

there's no reason you can't take a picture of the person in the driver's seat. So I'm going to be interviewing the CEO, Garrett Langley, later this month from Flock Safety. And it's a really interesting company. And I'm just curious what you think about this and what questions you might have for him

in terms of privacy and safety, and should this be allowed or not. I don't have exactly a position on it now. I tend to think our privacy is an illusion, and it's already been compromised, because if this software is out there, and it's an API, and there literally is an API provider for this now,

and there are open source projects. People are already doing it. And I bet somebody has an app somewhere that you can put on your old pixel phone and mount it to a wall or your dashboard and just, every time you drive up and down the 280 or 405 in LA, you could be tracking every license plate and know who's in what car.

It's kind of crazy when you think about it. And I'm just curious your opinion on it. Okay. So let's get to the interview. All right. Next up on the program, we're going to talk about robotics and what jobs will be eliminated and how we're going to feed the world. Now, I was at Stanford this morning.

I was in a class and somebody said, hey, what jobs are going to be eliminated? And I said, you know, it's interesting. Cashiers and cars and people driving trucks, this is starting to happen already. We're starting to see that some jobs, which are mind-numbing and horrible, like standing on your feet all day and typing in somebody's order, that's being replaced by people ordering on kiosks or on their phone.

And driving a truck for a living, there's, I guess, some romance to it in some ways, but I think most people would argue, that's a really tough job to stay away. awake for 10 hours a day and drive down the road. It's hard. It's arduous. You've got to be away from your family. Self-driving trucks are coming. When I saw this next company, which my friend Rob May introduced me to, and I had invested in Rob's company, I was like, wow, this needs to exist in the world. Why are we not using AI, computer vision and all this technology, robotics, to go in there

and just pink, pick raspberries and blueberries and blackberries without people having to be doing backbreaking labor on their needs. all day long in the fields picking berries. Shouldn't this be done with technology? Well, we were lucky enough to invest in a company called Route AI, and we invested in them about

a year and a half ago or something like that. And then I found out they got acquired. It was one of the quickest investments to acquisitions we ever had. So Root AI got acquired by App Harvest, and I was going to have the founder on the program to talk about the investment we made in this company, and by that time,

the company was, acquired, and App Harvest acquired Rude A.I for $60 million in April of 2020, just a couple months ago, for $50 million and $10 million in cash. So, instead of having the CEO of Rude A.I. on, today I am lucky enough to have Josh Lessing, the CTO of App Harvest on. Hey, Josh, how are you? Good afternoon. Congratulations on the acquisition. We invested last year, I think. Last summer, almost a year. So it was the end of July. of last year. So we're just coming up on that anniversary now. This was incredible. I heard the pitch from you and we met through Rob May. Tell me what was the

pitch of Rude A.I that I heard. Maybe we could share that with the audience and what you were setting up to do here with Rood A.I. So at Rude A.I, we were set out to transform farming. You know, right now, farming is one of the major sources of pollution in the world. It is delivering a product that does not, it's not easy to access. It's not as nutritious as it should be. And frankly, as we look at all the challenges that come with climate change, the way in which we source our food is just broken. Right. You know, if we're getting our food from all over the globe, it at a moment's notice, that supply chain, especially with fresh, can break down. So what I wanted to do with the business was pivot the world's food supply to a model where every single country had the

fundamental infrastructure that it needed to feed its people. And that was going to require a bunch of technologies, including artificial intelligence, robotics, and in greenhouse farming. And so I framed it as backbreaking labor in the fields. But in fact, I was wrong. It's not just about that. It's really about, hey, what if you could have blackberries and raspberries in your backyard being farmed indoors? And your plan, if I remember correctly, was to sell the equipment to farmers. You were looking for farmers and you were going to sell them a solution. What was that solution and what was the first iteration of it going to be?

Yeah. So, you know, the big signature part of the product roadmap was a robot that was universal, right? So, you know, what we've lost isn't access to, you know, one bespoke machine. We've lost the agility that comes from being able to pick any crop, see any crop, understand it. And so what we were building and what we continue to build is a robotic system that can care for your crops. You know, the current iteration picks grape and cherry tomatoes. It also picks strawberries. It picks cucumbers.

And it's built on a human body plan because the, you know, the aha moment is if you ergonomically structure a crop environment to be picked by people and you design the crop genetics to support the same, if you could build a robot, that has the body plan of a person. And by that, I mean, you know, the way in which the linkages of the arm are the same, the extent of the fingers, you know, finger dexterity and frankly, robotic capacity to understand how to be dexterous, that we could develop an unbelievably versatile tool that facilitates harvesting, a very time-sensitive, vision-critical part of the farm. But much more importantly, could also start infusing farming with data, right? Farming is an unpredictable form of manufacturing, where your most upstream process is highly volatile.

Being able to have a robot there, understand what products is being brought in, and build every single workflow around that data, creates tons of new opportunities. And so that was the value problem. Okay. So to unpack that a bit, humans have evolved as an agricultural society and species for, some number of years to pick produce from the vine, from the tree. And that process of growing is random in its nature, even when put inside of a factory with, you know, pristine conditions and temperature and water.

We still don't know where on the vine exactly the tomato is going to grow. So it turns out that making an arm that is similar to, to a humans and having a visual system similar to a humans and then building from that point forward is the optimal way to build a robot that can pick vegetables and fruits from the vine. Multiple crops, quite specifically, right? So there is a certain amount you can accomplish in the plant genetics itself, how the plant structures this self. This is not GMO. This is just centuries of breeding. And one of the things you breathe, for is the ability to be, you know, have the plant be workable by people. And you can create

infrastructure that ties up vines and trellises branches. But, I mean, there's a limit to that, as you're pointing out. So, you know, the thing that you're tailoring for, the harvesting is done by people. So making the robot akin to a human's kinematics and general kind of strategy and approach to picking is what allows it to go cross-crop. And that's, you know, the fact that we're building a universal harvesting platform that facilitates so many different crop needs is in line with what you need the tool to be truly transformative, useful, a game changer. And, you know, what we were doing at Root and what we continue to do here at App Harvest is really push the envelope there and that, you know, ours is the very first robot to ever go cross-crop, ever do multiple

jobs at the farm. And we're working on continuously expanding that functional envelope. And this is very analogous to a conversation to which I had with the CEO of a dishwashing robot except that they made standard dishes because they didn't want the robot to have to learn to do all dishes. So they said, you know what? For the first version, we're only going to have

these very specific plates, these very specific bowls with the specific magnets in it to just narrow the scope of what The dishwashing robot has to do. And that was Linda Pooleet from Dishcraft Robotics. That was a great episode. I forgot the number of that episode, but you can look it up online. What you're saying is that was episode 1140 for those people who are fans of the pod back in November of 2020. You've built a robot that could literally go into the cherry tomato fields, then go into the strawberry bushes.

And the cherries might be growing, you know, five, six feet high, and the strawberries might be on the floor. whatever it is. And the same robot can do this. It can pick either type. Without a hardware change, it just would be a software change or we'd have to just understand the lay of the land. So, quite literally, the lay of the land. So yeah, so you, you slightly change the gripper, you know, in the same sense. It's the same theory of operation, but just like you would pose your hand like this for a cucumber and like this for a beefsteak tomato, we change up the gripper in that way. But beyond that, it's software. And, um, I would say that there's a bigger, you know, when you look at these plants, you might think that they're completely random.

And they're not truly, you know, a cucumber, a pepper, a tomato. These are all vine crops with symbol or kind of indetermined genetics and trellising. When you talk about raspberries and strawberries, these are bush crops. There are anatomical features there that you can identify with an AI, kind of parse that environment, find a free path to approach the object, and then land fingers on the object to organize. to illustrate the pick. And so from that perspective, you know, building the system with the flexibility to really think about vine crops all similarly, because there are a lot of similarities there, and think about bush crops similarly. I wouldn't say that the, it's so mind-blown. I wouldn't say that it's boundless, right? Like, there are things that facilitate the robot.

It's a part of why it's such a good pairing with greenhouse farming, and that the way in which greenhouse farms are laid out is literally the same all over the planet, which is confusing at first until you realize that you're building a massive indoor growing environment. You could be, you know, the one I have not too far from where I'm doing this call right now is a 60-acre building. I've been in 200-acre buildings, you know, and these whole structures are designed from the ground up to support the plant's health, its biology, and the plant has very specific needs. So you go to facility after facility and it's all running the same exact arrangement and structuring of the crop. So it does create a bit of a simplification. I would say as far as,

you know, the discraft comparison, the fact that we're focusing heavily on these highly sustainable structured farms is our version of custom dishes. But at the same time, you know, these kinds of farms, you know, if you're getting a tomato at the grocery store now, odds are it's from a greenhouse and they're taking over the world's food supply chain in a lot of major categories so leaning into that environmental structuring is a big deal and this is a good thing for humanity that we're moving towards greenhouses for our vegetables and our plants and you know fruits because it's more sustainable it'll be higher quality and more nutritious or is this bad and it's better to have free-range bushes everywhere.

I'm sure there's some hippies somewhere who are like, this greenhouse stuff is terrible. In reality, am I correct in thinking that the greenhouse, because it's more controlled and more productive, is less on the, less impact on the environment? Oh, certainly. So, you know, it's all in how you formulate it, but you can get remarkable results with greenhouse.

So we're using 90% less water. you know, we're producing about 30 times as much produce per square meter in one of these facilities. We're not, you know, we're not using any harsh chemical pesticides or herbicides because since you have this enclosed environment, you can actually have good bugs that fight the bad bugs. You know, you can bring in predatory insects that kill off the insects that damage your crops and then that way not put chemicals on your crops. Wow. So mind-blank. Even, I mean, so I travel frequently to the Netherlands where a lot of this technology was invented.

And, you know, you can pair, you know, something like Royal Dutch Shell and the, you know, the carbon dioxide effluent from one of its facilities and then pipe it into an agricultural corridor and use the plants for carbon sequestration. They breathe CO2. So why not pair it with the facility? Take its waste heat and its CO2, make it more sustainable. And, you know, fundamentally speaking, besides the fact that it's, it makes good, nutritious food that can be made, you know, right now where, you know, where the farm I'm referring to here right next to this office, we're within, I think, one day's drive right now of about 70% of the U.S. population, so we're not trucking. And so, you know, all of these things really increase, you know, the kind of just sustainability score that we have here. And fundamentally, we have to go in this direction. there's so much volatility coming in the weather that is scary and it's dangerous.

You know, living in a world where you cannot depend upon your food supply is a pretty spooky one over the course of my life, right? I am now getting towards the end of my 30s and over the court and about one third of the world's arable land just disappeared. Not disappeared. There are very specific reasons of what we didn't do to prevent it. But, you know, these are farming facilities that don't require. arable lands. You put them down. The grow media is whatever you choose. You put it in a bucket. You can grow the tomatoes. You can grow the strawberries in there. You don't need to have amazing arable lands. You can grow this in the Middle East. You can grow this in China. You can grow this

in India, in the U.S. And people will have food. And it's a place that we have to go as a society. And I would say one of the things that really excited me about building root is I've always had ambitions of making the things that I work on be meaningful to the world around me. But often if the thing that you want to build isn't aligned with major financial objectives of big corporations, you know, it's hard to align what's the right thing with what's the profitable thing. And in this case, that's not that's not the case at all, right? By building a distributed network of fresh, you're actually creating a food infrastructure that is the perfect marriage between, you know, the way in which Amazon thinks about order fulfillment, the way

which Walmart thinks about order fulfillment. So you're all of a sudden giving the biggest drivers in the restructuring of global commerce the way they would want to get access to food, which is put the food facility right next to my fulfillment center. And for me, the fact that they want that. And then all of a sudden, we get to make it environmentally sustainable is, a reason to really, you know, as an entrepreneur, break your pick and make it happen. There's another example of like, show me the incentive. I'll show you the outcome. If the incentive is wherever you're already shipping produce to restaurants and supermarkets, we were literally putting vegetables and fruits onto trains, I believe, then taking them to

centers. And then those centers would put them onto trucks to then bring them to supermarkets and restaurants, etc. You're saying, hey, wherever that depot is for Cisco or whatever the distributor is, we'll put our greenhouse next to it. Is that what I'm hearing correctly? And that has to be the future of food. And it's something that is already starting to come into the foreground. And it's just a fundamentally better solution.

You end up getting, first of all, more shelf life out of the product, right? If I don't have to move it for... How much more do you get? Because is it like a week for something like strawberries or tomatoes? What is the time between when it gets picked and I eat it today and then how does that change when you're doing it? Yeah, sure. So, I mean, a good personal example is I was reviewing the technology landscape of a produce company that did conventional. And I traveled to one of their farms in Mexico and pick some crops. And I'd say that in the field, that strawberry was quite good. And then I made sure to get the exact same crop when I made it back, you know, our offices in Boston.

Eight days later, it hit Boston. The product was not nearly in the same condition. Some of it was damaged, rotted, not particularly flavorable. And those eight days, all of that transit mattered. And one of the other really disappointing things about our current food supply, the status quo, that we're trying to replace here, is, You know, you design it when you breed plants, you design it for trucking. You're not designing it for nutrition. You're not designing it for flavor.

Like, those are factors, but they're not like the dominant factor. And in a world where healthy food is medicine, it's what really, you know, I focus on things. I worry about housing. I worry about food and I worry about medicine. And in a world where I can get you a sustainable farm that produces, you know, fresh that you want to eat, that's a big deal. So, yeah, so capturing eight days back is a big deal in quality. But what you're also saying is the design. They were designing for it to not get ripe for eight days.

Am I correct in my guess? Yeah, so to make it to survive that transit is really depriving the food of its quality. I mean, the way in which you used to get tomatoes is you'd harvest them, let's say, down in, you'd harvest these outdoor beefsteak tomatoes. you'd harvest them when they're practically still fully green, you would gas them with ethylene to force ripening as on its way to market. And the end result is not a product you want to feed to your kids. And we, that was a miracle at the time because we could then get tomatoes anytime we wanted

and we could have abundance. And so the motivation wasn't completely bad at the time. it was suboptimal. Now we can actually grow these the proper way and either get additional shelf laid out of them or more nutrition. You've been working on grips. I believe you were at MIT, is that right?

Working on the grips or somewhere? So I was in MIT, but my gripper work started at Harvard a long, long time ago in a galaxy far away. That was like the 2013 time period. You were working on these grippers or something. So I have a question for you. Is it the gripper technology that was the gating factor?

Or was it the AI and computer visualization to understand, hey, that's a strawberry, that's worth picking. Or was it the AI piece to like get in there and operate around the, you know, leaves and stems? Or was it the gripper? What was the gating factor on this technology getting to market? Yeah, so it's definitely the AI piece. So leaving Harvard, I built out another robotics company, and that is a robotics company that is really, really focused on the, you know, the mechanical engineering and materials of the gripper for, and that was in a case where, you know, kind of the Amazon problem.

Variable size, weight, shape needs to get into a box, infinite number of skews. for root, it was the exact inverse problem, which is, you know, these, a tomato is a delicate object, but like, it's not like one tomato is going to be the size of a grape and then one next to it to basketball, right? Like, it is reasonably regular. You need to have a lot of experience in how to grip, and that's something I've built over a long career in doing this, but, you know, really the new challenge was the artificial intelligence. And until recently, it just wasn't doable. You know, both the, you know, the massive advances in convolutional neural networks and their applications to computer vision, that was enabling. The fact that- Explain that for a second. Unpacked that. What does that mean in plain English to a neophyte? So, you know, the modern world of computer vision is really robust in that, you know, you're creating these training data sets.

You're taking photographs of an environment. You are annotating. You're circling the objects of interest. Let's say you're looking for cars. you're circling images of cars. And you're feeding those images where a human said where the cars are into a complex statistical model that teaches itself what are the fundamental attributes of cars. And if you put, you know, unincluded images of cars, it's just, you know, easy to see

whole car. It will find whole cars. If you add to that dataset semi-obstructed views of cars, it'll get good. And it'll start to understand how to also find semi-obstructed versions of cars. you know, if you take a look at some of the older versions of computer vision, where it was really kind of top-down creation of the different filters that found objects, they just would easily break down in practice in complex environments. So they were really good at, you know, if I needed to pick an object off of a conveyor and put it in a box and it was a well-singulated object, it had nothing else around it. And it was up against a simple background. It was a white conveyor. you know, you could, and maybe it had a logo on it where you had the ability to look for the lettering.

You could take that previous generation of computer vision and make it work in that application, but you throw a pile of those objects into a bin and it's many different objects and suddenly the environment is hyper-complex and those vision algorithms, the older ones, would fall apart. The modern generation of computer vision that everyone's talking about is able to take on highly complex, real world applications and it's quite remarkable. I would say that the, another major thing that has changed is being able to have computers that you can use at the edge.

So when you're in an farming environment, you know, you're first of all, usually far away from, from Wi-Fi. You're far away from the, it's not like you're going to plug into a wall jack, right?

You're often surrounded by plants, which have a way, you know, all the water content in those plants also have a way of blocking signals. So the concept of like, I'm going to take an image at the robot, I'm going to pass it to a computer in the cloud, and I'm going to run a model. That is not, for the most part, a tractable solution for real-time artificial intelligence required for picking. The fact that I can buy a system on module computers with chips designed for running these models, and they barely consume any electricity super important for a mobile platform.

I can just buy these things. They're cheap. and I can put them into my robotics platform, like, that's a complete game changer. It's the reason why you're seeing, it's one of the reasons why you're seeing autonomous driving become an ever more practical application of artificial intelligence. That is the reason why we're seeing a lot of hardware

being put at the edge of computer platforms. We had a company on the program that was building cameras for checkout lists, shopping and they put there are people making cameras with graphic cards in them or putting racks in the back of the stores

so that they can do that computing computer vision in real time and that all comes from gaming correct like if the gaming cards had not been 60 frames 120 frames per second and that increasing crazy resolution

we would have never had these invidia cards or whatever cards to be able to do this, correct? It's funny because where I started to experience those graphics cards was early in my career when at a point in life where I was very misguided and I wanted to be an academic. And, you know, there's a lot of, I was doing a lot of spectroscopy and protein biophysics. And all of a sudden, there were a couple of really brilliant groups that realized you could start running a lot of hardcore physics on, you know, PlayStation's.

and then you started like, you know, slapping together a bunch of PlayStation's, you had a supercomputer, and it was earth-shattering, and that was in my old field a million years ago, but, you know, that same kind of aha moment that it's a fundamentally different

kind of chip in the way it, it runs these calculations in there, and the kinds of math that you do for artificial intelligence is really well mapped to those chipsets. It just makes everything, move bleeding fast. And now you have the economic incentive of cryptocurrency and Bitcoin and hash.

Is that compounding at another level that people are buying all these cards to do that? I mean, I love the fact that people are doing all of these custom chip projects and that we're getting ever more specific kinds of chips for running, you know, different parts, you know, different kinds of, you know, important calculations that you would find on a robot, but the other application you just talk about as well, being able to run that all at the edge with very, very little data passed along, a sparse amount of metadata passed along to the cloud or passed along to a user. It just, it allows you to put these algorithms in places where they touch the real world and solve dramatically more interesting problems,

or at least more interesting to me. Yeah, I mean, if you look at the M1, which I'm on a Mac Minutes, M1, which is like the super cheap computer. It, and then I have the M1 MacBook, you know, laptop. And it's amazing. They literally made a chip designed to run a browser, essentially. They were like, how can we run a hundred browser tabs without your machine crashing, without slowing it down, and without burning the battery out? It seems like that was Apple's number one, you know, criteria is how long did your battery last?

And now the battery lasts on some of these laptops two days. or 25, more than you could ever need, 20 hours of battery life, all because they're doing these, the number of components is going down and the functionality and the specificness is going up. I think that's why Tesla did their own, you know, circuit board as well for their self-driving program as opposed to just slapping NVIDIA is in there, correct? Yeah, and it's becoming dramatically more attainable to actually make these custom chip sets. So, you know, I mean, it's a combination of different things, right? I had a background in robotic dexterity for food, which is a weird specialization, but here I am.

You know, the convolutional neural networks that were coming out for computer vision that were remarkable, these chipsets, the ability to use cloud resources to train your models, and just so much, just, you know, back-end infrastructure for deploying all of this. You know, it just, it makes it faster to innovate. and it's the reason why you're seeing, you know, applications of artificial intelligence in the real world all the time. By in the real world, I mean, like, if it's a robot driving by you on a street, that's in the real world. And the thought of, you know, people talk about software in the world and all of these efficiencies that have been garnered from software, but they've lived in realms where the entire workflow was digital. FinTech, sure.

online, you know, many aspects of online commerce up to the point where you have to do the order for film unsure. The idea that you can push this technology out into physical environments and do physical work is just mind-blowing when you think about the possibilities and to be living in this moment in time is remarkable. And for me, you know, I have a particular dream, right? Like if going back to the theme of its shelter, it's medicine, it's food, if I can be part of a project where what the world gets is a building that infinitely pumps out food and it's easy to use and it is reliable, we've solved one of the biggest problems that humans have ever had. We're on the cusp of massive abundance when it comes to food, aren't we?

I mean, the cost savings from having robots pick this, from it being in a factory that doesn't have to deal with weather, doesn't have to deal with bugs, and we don't have to travel from Mexico to Boston to get your strawberries. I mean, this is, is it going to make, if you had to guess 10 years from now, adjusting for inflation and everything, how much cheaper will food be or more abundant? Is it going to be a dramatic lowering of cost or just higher margins for the people sell the food or it's going to stay sideways? So as far as lowering your costs, I'm not sure if I'm able to fully wrap my head around that in the sense that, you know, I think one of the major issues that we have now is lack of access. You know, the ability to distribute food production and be able to make it accessible to different communities is one of our massive challenges. And, you know, we're looking at a huge increase in the global population over the next 30 years. So demand is going up. And then as many societies are becoming, have better infrastructure, people are becoming more affluent and biaffluent.

I mean, some crazy form of wealth. I mean, like being able to be able to build a good life for their families, our diets are becoming more complex. Our calorie counts are going up. So, you know, the amount of food that we need to produce, it's access. right? You know, we're, we sell our, we could sell our product for more here at the company, but, but we don't. It's a matter of principle. You know, so we're keeping what we make accessible. But, you know, for me, it's really just expanding supply and protecting that supply against the changes that are coming. And, you know, we're really spearheading this mission, you know,

kind of look around and I think not enough people know that our, food supply is, you know, tragically underserviced by technology. There are things that people who have engineering and science degrees could commit themselves to and make meaningful change. And we really want to be the ones who lead the charge. Well, it's not only is it under, not only have we underapplied technology to this specific problem and category, we don't have the redundancy and the resiliency in the supply chain. We only have 30 days worth of food. I believe, you know, Freiburg mentioned that

statistic on an all in podcast recently, David Freeberg, my friend, that the world lives on a 30-day food supply. I don't know how exactly accurate that is, but I would think for vegetables, it might even be, and fruits, it might even be less. Like, we might be living on two weeks or three-week supply of fruits and vegetables. In which case, if we have hurricanes, rainfall, extreme weather, you know, pandemic, and let's say the pandemic was really, you know, Ebola like, God forbid, and people died from going to work. We sent frontline workers. We sent people into the fields to pick food. They weren't given the option to stop working. If it was truly, you know, a deadly pandemic, you know, 30, 40 percent of people who got the disease died, and people just said, I'm not showing

up for work. I'm not bringing food to your house. I'm not instant carding. I'm not door dashing. Screw it. I'm staying home. We would have had a total breakdown of society. Now, if we had redundant food supply in every city, it would be a lot different. Am I correct? Exactly. Not to be completely sappy here, but I have a kid. And a big part of kicking off root and a big part of this acquisition had to do with thinking about what is the world she's about to receive. You know, I, you know, it's a term you'll hear it go around, water wars, right?

you know, the idea that we are going to fight over these resources well before they run out. The second that people start to fully understand how fragile our ecosystem, ecosystem is, I don't mean environmental ecosystem. It just mean the infrastructure. Yeah, our infrastructure is when people start to piece that together because they see disruption, it's not going to be a good world that we live in. And so, you know, building this business. Yeah.

And so, you know, one of the, so I, So Jonathan, who is the CEO here, is actually, I met him just at the founding of Root, and he shares the same vision. He wants to, you know, he wants to improve the environment. He wants to create sustainability in our food supply. And he wants to bring jobs and wealth back to communities, which is what we're doing here in Kentucky right now. And all of this can be accomplished with this tech stack. And it has everything to do with building a better society. and the acquisition here allowed us to really pull in the entire product roadmap, which is more than just robotics.

It's artificial intelligence to minimize how much energy we use and inputs we use to grow the same amount of food. It is, you know, it's understanding how all of the processes in a farm work, the human processes, the robotic processes, the growing processes, and using Enterprise ML to deliver more food at, you know, with less. waste. It has to do with, you know, all sorts of different innovations that we can do in the supply chain as well to make sure that the goods that we move are more effective. And, you know, being able to work with a company that was very well capitalized, had dedicated group of investors that were looking to do something massive, global scale agricultural technology products. You know, that was an ability for us at Red Root to really leap forward by over-euvre. a decade in our development timeline where I don't think times are a friend right now.

It's really interesting. We had this conversation on the last episode of All In, where I was just saying, like, you know, we sometimes the solutions are right there and they're just not implemented or implemented at scale. And I was saying, like, why don't we just put a nuclear, these new nuclear reactors, the small ones near the ocean, up and down the California coastline with desalinization plants and then you've got the energy for the desal without, and I know desal and there is an economic,

there's an environmental impact to everything. Nuclear has an environmental impact and of course desalization does, but global warming is having a colossal impact on the entire planet, to your point about we're screwing up our farmland. So if we implemented just a three-part plan here, nuclear desalinization and what you're doing with factory,

I don't want to call factory farming, but farming, organic farming inside of factories? Is that the way to refer to it? I like to think of it as organics farming inside of large robots. You know, these buildings are like 60-acre robots themselves. Yeah. If we just did those three things, we could really change the redundancy, resiliency, and the effectiveness of our supply, our infrastructure here in the United States,

and all that technology exists right now. We just don't have the leadership and the will to implement it. And it's up to entrepreneurs to make it so affordable and undeniable that society says, okay, fine, fine, you've made it so obvious now and so cheap and affordable, fine, we'll do it. But we don't have, we shouldn't be struggling with this. It's like the MRI stuff. Like, we had MRI for 20 years. We just didn't have the will to put it to work.

It's incredibly frustrating that society is throttling. the technological advancement. And let's face it, if they, if our government gave your company a billion dollars to go deploy this across the United States, you would have no problem building, and what does it cost to build one of these robotic farms?

Like $10 million, $25 million? So a bit more than that. So they are considerable pieces of infrastructure. But at the end of the day, it's not, what is one of these 60 acre? You know, you could probably do for,

you know, between a million and $2 million an acre. for some of these facilities, depending upon how you want to do the math. So $100 million, and what does that feed? How many people does that feed? I mean, it feeds cities. You know, that's what's important about this. And, you know, we've had incredible support here in the local community, both at the,

you know, the community level and the government level. And so the goal for the company is to make 12 of these farms by 2025, which to me is the real MVP. You know, we're going to be making leafy greens. We're going to be making strawberries. We're making tomatoes. We're going to be making, you know, all sorts of crops you can grow in a greenhouse. And we're plunking it down right in the middle of 70% of the U.S. population.

Amazing. And demonstrating what a fundamentally different food supply looks like. And I'm also proud to say, and this rarely ever comes from the mouth of a roboticist, we're actually doing this in a way that expands jobs, you know, considering that we're Well, considering that we're importing a lot of this food from abroad, these are jobs that already left and we're bringing them back here. And the other cool thing is, you know, you talk to any farmer. We're re-importing jobs.

We're re-importing jobs. And also you talk to any farmer and the work on the farm is never over. You know, you could be in one of these facilities. And when you have a million plants and the outcomes in the farm go up, the more you can individualize care, you know, the fact that a robot is doing one job means you actually can make time for another job and it massively increases the performance, the crop, the sustainability, the infrastructure. So, you know, the company stood up a massive growing environment in the middle of a pandemic and employed a community. And that, you know, being,

it's just saying, you know, it takes entrepreneurs to do this work when others won't and then build a community and a movement around that success. It's really crazy, too, because if you think about what this sort of of large-scale agriculture. I don't know if there's a term for large-scale agriculture. What did it get us? It got us dwarf wheat. It got us soybeans and corn and corn syrup.

Like, if you wanted to scale agriculture, it meant narrowing the big ag, right, is I think the term, big agriculture. Big ag got us like a very narrow set of scaled calories, corn, soybeans, wheat. Turns out these are not great for humans. it turns out leafy greens and the green stuff and the vegetables and the berries, they're better for you, but they don't scale as gracefully. But now with AI, now with training the data sets, and now with robotics, we can have a better, everybody could have a better set of calories.

Is that correct, too? Exactly. You know, if you look at, you know, like a lot of the row crop, right? These are crops that were automated. When you think about a tractor, that means it's mechanical automated. I mean, these days, they do fuse it with digital innovations, but that's automation. No one has been able to automate some of the most important crops for your diet. And, you know, that's something that we fundamentally need to change.

Leafy greens, is that on the menu? Or is that just something that's, you know, we've already got a robotic solution for that. Because are they, are leafy greens picked or are they just cut? So you can cut them. And we're building out automated leafy green facilities. and it's really nice because normally, you know, you're shipping this in from Arizona, California, Mexico, which, you know, if you live in Washington, D.C. is a little bit of hike. And for leafy, you know, those are very, very perishable crops.

And at the same time, they're also crops that when grown outdoors, you have recalls, right? You have recalls around dangerous bacteria. And the idea that you could grow things in a way where you're not, putting anyone in jeopardy, which is a real thing that we have to intend with now, that's a game changer as well. Yeah, you guys don't get the arugel like we have out here, man. Oh, God, the baby arugula here. I get this watermelon salad at the Greek joint by me.

Oh, my lord. That is something I, you know. Watermelon arugula salad with feta. Yeah, I mean, the further you get from where your food is grown, the quality just goes off of a cliff. And so as someone who's a bit of a foodie, uh, my, myself and I've traveled the world, you know, every kind of a food product you can imagine. I mean, there's also just the fact that it's nicer to be enjoying what you eat and being able to

make wildly good products not a luxury. They're a freaking human right. And that's part of the goal. Beautiful. It's beautiful. Think about it. Like if poor kids, you know, who don't have a lot of money are right now eating like factory farmed meat on, you know, bread.

and that's their diet, cheese, bread, meat, and they could be having a beautiful arugula salary with great tomatoes, some berries in their Greek yogurt. I mean, it's all about Greek food anyway, but you could have this could be so much better. Oh, by the way, just for folks who were wondering, the company was standard cognition. Jordan Fisher was on episode 977,

doing the automated checkout using computer vision at the edge. And then Lila Jana, tragically, from Samasource, who passed away, was doing training of data. datasets with people across the planet, including in Africa and people training the data sets. But when you train the data sets, do you use like some outsource people to look at cameras and just circle the strawberries and say, pick this one, pick that one? How do you know which strawberry to pick? So yeah, you have to.

So in the case of strawberries, it's color. It's also morphology. So for example, one- What's the morphology mean? So you don't get to see this at the grocery store, but when a bee doesn't, an incomplete job of pollinating a flower, you end up getting these massive, like, empty cavities in the strawberry. The strawberry looks very, very unusual. And so, you know, it's, it's morphology, it's color. And ultimately, what it really should be is bricks. You know, that is the sugar content of the

strawberry. We're not talking about a Snickers bar here. We're still talking about a healthy product. But, you know, if you could start moving, you know, what your standards are, you know, picking to a flavor profile, getting that perfect acid balance and sugar load. You know, strawberries should be candy. These should be things that your kids are, you know, pulling out of the refrigerator because, you know, they're looking forward to it. And that is something that you can achieve with this kind of technology. I'm looking at strawberry morphology right now.

You got the oblate, you got the goibos, you got the guybo's. Conic, conic, short wedge, long wedge, neckered, long conic. What's the right shape? What's the right morphology for the most delicious strawberry in your mind? I mean, that's a long conic. The important thing is they're all delicious. You know, but. The most delicious.

Is it the conic? I feel like the conic. So I personally love any really tiny strawberry, one that really had, you know, that's one of the better ways to get a high sugar content in the berry. They're often much, much harder to bring to market. in a way that's economical because of just when the berries tiny, right? They spoil quick. And they spoil quick.

And there's also like just how, how much effort it takes to harvest them. But when I see those on a grocery store shelf, I run for them. I mean, and they're frankly, they're harder to find. A lot of things are harder to find in the United States. Like when we, when I go to a grocery store in many places around the world, it is an experience. But in the United States, I think we're just awakening to the fact. that our grocery store shelves can have much, much better variety. You know, you mentioned as it related to a lot of row crop agriculture that, you know,

figuring out how to, in an economical way, deliver food meant delivering a small number of foods, and there wasn't a lot of diversity in what we are eating, you know, using robotic systems that allows you to achieve scale in a variety of different crops in a way that's economical also means that we can start driving a diversity of what we see in the grocery store, which also just heightens the food experience. Wow. So the idea being that you could have five different types of strawberries, and you could pick all of those and have them sorted by different sizes.

I like the small ones. Great. If I wanted the giant ones because I wanted to dip them in chocolate, I could do that. Amazing opportunity to increase the diversity. Listen, thanks for letting me invest in the company. I'm still a shareholder. I'm really excited to send these shares to the syndicate.com.

It's the quickest turnaround we ever had. I'm under a year, and I don't want to say exactly the multiple, but a multiple are investment on one year. But for me, as the lead, I am going to get those shares and I'm holding them, because I want to see where you take this. I'm really, really excited. And, you know, it was for me personally very meaningful to be able to make this investment and I couldn't be more happy that you found a partner to help scale it and really make the entire, you know, infrastructure of our food and our ag better for our daughters and all kids out there.

I mean, I think it's really not to, again, to be sentimental, but, you know, it's like really nice to work on projects like this as an investor and or com.com for meditation and well-being or blockable for housing. You mentioned your passion for housing too. Like, we can solve these problems. We could solve food, we can solve, you know, mental health, and we can solve housing. These are not beyond our reach. They're actually, all the pieces are there. We just have to implement. You have to flip the script.

You have to be excited when you hear these problems. When you realize that you have a relevant skill set that can change the world, it should be energizing. And so right now, I'm massively expanding the technical team. I'm looking for, you know, I'm not looking for mercenaries. I'm looking for missionaries. I'm looking, you know, if you are a scientist or an engineer, typically it means you're an optimist. You wanted to dedicate your mind to making the world a better place through the things that

you built. And so right now, I'm on a mission to hire up as many people that wanted to have an opportunity to apply their skills for good. We're ultimately figuring out whether or not a cell phone has just the right, you know, surface coating and rounded edge and that the app ecosystem for parking your car. I mean, these all are great in all, but their relevance disappears unless we get the basics down, which is in this case making sure that we have great food and that we're passing along a world that everyone wants to live in.

And here it is, folks, app harvests.com slash careers. Tons of jobs from a greenhouse operation specialist to growers, people ops packing the vegetables and technology. If you can write code, if you can build robots, if you can... Data scientists, machine learning, cloud.

Architecture, scrum manager, so many great gigs. Embedded. You got to do hardware. You got to do software. You got to do everything. We're hiring for everything across the board.

This is a great place for you to make a positive impact on the world. Go to apparvest.com slash careers. Stop trying to make the Facebook ads. 0.07% more clickable to trick people into clicking on some dumb ads? I heard a great quote from one of my investors, and he lamented the fact that the greatest minds of his generation spent their lives figuring out how to get people to click on a banner ad. Like all of the algorithms that go into that.

And we can do it differently. So that's the opportunity. That's what we need to get back to here, is this optimism that we can solve the world's biggest problems and create abundance for everybody. Housing blockable. Food app harvest. Mental health, calm. There are so many opportunities. Space exploration, SpaceX, sustainable energy. Like, let's solve these worlds problems. Stop with the goddamn ad network clicking. Quit Facebook, quit Instagram, get the hell out of there, take the bag, get all those RSUs, and go work for app harvest right now. That's my message. All right, listen. Thanks for letting you.

me invest in the company and continued success. And hey, maybe we could in a year from now, when you get a couple more of these up and running, we could do a little check-in. Would that be okay? That'd be fantastic. A little check-in pod. All right, great, awesome. Listen, continued success. Again, thanks for letting me invest and letting our syndicate invest. If you want to invest in interesting companies, go to the syndicate.com and apply as an accredited investor. And I'm teaching Angel University to find great companies like this to invest in. I don't want to say exactly. exactly what we did, but we may have tripled our money in a year doing something really great for the world. And I'm holding my shares, because I think this could go 10, 100x from here.

I'm going long. Continued success, and we'll see you all next time. Bye-bye.