This Week in Startups - Google’s AI Design Tool, Salesforce’s $8B Comeback Deal, and M&A Momentum Builds | E2131

Episode Date: May 28, 2025

In this episode, we cover three major stories shaping the startup and tech landscape. First, Google unveils Stitch, an AI-powered web design tool with one-click export to Figma—signaling a major disruption for freelance design marketplaces. Then, Salesforce returns to M&A with its $8B acquisition of Informatica, aiming to broaden its AI data stack beyond CRM. Finally, we break down the surge in startup M&A activity, with billion-dollar deals from OpenAI, DoorDash, and others—hinting at a major Q2 rebound. Don’t miss Jason’s insights on what these trends mean for founders and investors.(0:00) Episode Teaser(1:36) Jason’s in SINGAPORE(3:14) The Power of Shame and why we need “Ozempic for screentime”(10:15) OpenPhone - Streamline and scale your customer communications with OpenPhone. Get 20% off your first 6 months at www.openphone.com/⁠twist(12:38) Google’s latest AI breakthrough: Stitch(20:13) CLA - Get started with CLA's CPAs, consultants, and wealth advisors now at https://claconnect.com/tech(21:20) The NBA on Polymarket and what founders can learn from the Knicks(27:08) Why did Salesforce buy Informatica?(30:03) Pilot - Visit https://www.pilot.com/twist and get $1,200 off your first year.(32:42) M&A activity continues, and Jason’s spicy Q2 predictions(40:57) Did tech go woke or was it just performative the whole time?(45:22) Circle, stablecoins, and the perks of being pro-business(51:27) What Trump’s “golden share” of US Steel might look like(54:15) Why Jason is bullish on Joby(57:28) Episode wrap-up and upcoming eventsSubscribe to the TWiST500 newsletter: https://ticker.thisweekinstartups.comCheck out the TWIST500: https://www.twist500.comSubscribe to This Week in Startups on Apple: https://rb.gy/v19fcpLinks from episode:ClearSpace App: https://www.getclearspace.com/Google Stitch: https://stitch.withgoogle.com/Joby: https://www.jobyaviation.com/Follow Lon:X: https://x.com/lonsFollow Alex:X: https://x.com/alexLinkedIn: ⁠https://www.linkedin.com/in/alexwilhelmFollow Jason:X: https://twitter.com/JasonLinkedIn: https://www.linkedin.com/in/jasoncalacanisThank you to our partners:(10:15) OpenPhone - Streamline and scale your customer communications with OpenPhone. Get 20% off your first 6 months at www.openphone.com/⁠twist(20:13) CLA - Get started with CLA's CPAs, consultants, and wealth advisors now at https://claconnect.com/tech(30:03) Pilot - Visit https://www.pilot.com/twist and get $1,200 off your first year.Great TWIST interviews: Will Guidara, Eoghan McCabe, Steve Huffman, Brian Chesky, Bob Moesta, Aaron Levie, Sophia Amoruso, Reid Hoffman, Frank Slootman, Billy McFarlandCheck out Jason’s suite of newsletters: https://substack.com/@calacanisFollow TWiST:Twitter: https://twitter.com/TWiStartupsYouTube: https://www.youtube.com/thisweekinInstagram: https://www.instagram.com/thisweekinstartupsTikTok: https://www.tiktok.com/@thisweekinstartupsSubstack: https://twistartups.substack.comSubscribe to the Founder University Podcast: https://www.youtube.com/@founderuniversity1916

I also think Jason, it shows that Google really wants to do everything in AI. They're trying to flood the zone here. And apparently just some success. So points to Sundar and his team. I got to say they were behind an AI and now we keep talking about him. So that's all. And as you can see here, we've shamed Lon, Alex, because of his prompt, and it worked. It worked.

He's going to do better. His prompt will be better next time. I think prompt shame is the next big thing. I mean, if you get people to use AII, we should be looking at people's prompt and saying, really, that's the best prompt you can do. This is what doing extra. This is what doing extra and it gets you on Twist. You see a thing and you think, you know what?

I need to test this out myself. I'm not just going to take. It's okay, Alex. You did a completely serviceable job. That, by the way, in Jason speak, is thin ice. Serviceable. Congratulations on doing the bare minimum. This weekend start up.

is brought to you by Open Phone. Streamline and scale your customer communications with OpenFone. You're 20% off your first six months at openphone.com slash twist. CLA. Innovation takes balance. CLA CPAs, consultants, and wealth advisors can help you get from startup to where you want to end up. Get started now at cLA connect.com slash tech. And Pilot.

Focus on your product. Let Pilot handle your bookkeeping. Pilot provides the most reliable accounting, CFO, and tax services for startups and small businesses. head to pilot.com slash twist and get $1,200 off your first year. All right, everybody, welcome back to this week in startups. It's your boy, Jake. I'm here with Bonn Harris and Alex Wilhelm.

One's in Austin. One's in New York. And one is in Singapore. I think you can guess I'm the one in Singapore. Gentlemen, how are we doing? What time is it there for each of you? It's 9 a.m. here in Austin, Texas. Okay, a little early for you.

It's 10 a.m. here, but I kind of enjoyed starting work today at 6.30 a.m. because I feel so productive. I have gotten so much done, Jason, in such a short amount of time. If you want to feel productive, every time I get jet lag like I am now, there's just incredible feeling. You fall asleep at like 6 or 7 p.m. when you get here, wake up at 12 or 1 a.m. and then stay up all night. So at 4 a.m., I decided to go for a walk for, you know,

two or three miles around town. This happens to me every time. In the Middle East, I'm in Asia, I'm in Japan. I wind up going for these 3, 4, 5 a.m. walks around the town. and it's, Singapore is a beautiful place. It's a size of New York City. But somehow,

they've carved out a niche here that they are, like Hong Kong was earlier in my life, like this incredibly central, important district. And so I have a list of places I haven't been. And when the speaker bureau is asked,

hey, would you like to speak at this incredible, extraordinary event? Would you like to speak at this incredible, extraordinary event. Here's a briefcase. You know, it's a pretty amazing life, I have to say, to be wanted and to be compensated from flying around the world. I'll leave it at that. It's, it's pretty outrageous. But, you know, I saw this thing on the Twitter. I guess it was called Lear Space, and I sent it to you guys. Yes. We have it here. What's her name, Alexa?

Alexia, but not so my former boss, Jason. Oh, she, your boss, at TechCrunch. I remember meeting her when she was Butta Cubs reporter in L.A. She heard a story about me back in the day. And, yeah, she, I guess, like all TechCrutch VCs went on, all TechCrunch went on to become a VC and got married. And she's Greek, so we have that. And here's Alexia's screen time.

If you check this out. And I guess the concept of. the screen time network is that you share your screen time so you can be shamed I think the goal is to lower it yes the goal is definitely

to lower it that's why they're calling it ozempic for screen time because that was Alexia's joke about it she said the world does not need another AI SaaS what it needs is ozimic for screen time and as you can see Jason from her chart here that I have up on screen she's making a lot of progress over a one week period

From 12 hours and one day to just over two, looks like. Well, I asked Oliver the intern. I bought him a phone. I logged into it as me and I'm on here. And I had him use it for 14 hours a day. And then I have him slowly going 30 minutes down so that I can publicly virtual signal that my screen time is going down here. So I have a burner phone to do that for me.

I got to be honest. I like the idea, but I don't know if shaming is, is the thing that's gonna work here? Like I just, I don't feel like you change, you're gonna change your habits that way. I feel like you're gonna do it for a few weeks and then go right back to your old, okay, your old, I feel like it's a,

it's a lifestyle change, not just like, oh, I feel bad, I'm gonna lower these numbers so that I don't get embarrassed. Let me, let me back into why you're very politely wrong, long. So one, this is from a company called ClearSpace. They're a Y-C backed company, Winter 23 was their batch, team of five according to their profile over there. This, Jason, as far as I can tell, is a viral marketing stunt by the company.

Yeah. Clearspace, their application for iOS and Android is designed to help you limit your screen time. This is kind of almost like a joke social network in a polite sense to show off what you're doing. Now, Lon, the reason why I actually kind of disagree with you is what gets measured gets improved. And I feel like right now, my screen time information instead of iOS is so buried deep down in the menus and the relatively lackluster software that Apple has on there. So I just don't see it. But if I get your weekly, I get my weekly report. Like they, they'll ping you once a week with your like, here's your weekly screen time.

And like, I look at it. And I agree it would be good to limit it. Like I'm not, I'm not debating the overall premise here. I just feel like, like, if I was going to, if I was going to make a change, I would have to like change something about my lifestyle that gets me off my phone. Like, I'm going to start taking a walk every day. Like that would get me off my phone successfully. Just being like, oh, I don't want Jason and Alex to. see how much I've been on my phone.

I don't know if that's like a real fix. That feels like a band. No, I think you're underestimating the power of shame. Shame is something we need much more of in our society. I'm here for it. I think we should be shaming people when they leave the office of 430. I think we should be shaming people when they gained too much weight. I should have been shamed when I was fat.

People should have absolutely tortured me. I should have been bullied and I should have lost the weight sooner. You had me in the first half, Jason, and then you lost me in the back But just for the sake of transparency, I went ahead and signed up for the Screen Time Network. Here is my profile. Seven hours a day. Seven hours a day. I think it starts tracking from when you join.

So clearly, my thing is here. But Lauren, what I really like about this compared to the iOS updates is it gives you a bit more information about when and how you're done. It kind of gamifies it a little bit. It gives you some encouragement. So instead of just being public shame, I think this also is kind of like your Strava results that you can share with your friends about how your runs are going. No one really pairs if you're running 15 minute miles or 10 minute miles.

But if you're going 15, 14, 13, that to me is kind of the thing you want to encourage. So I can see this working. I kind of like it. And Jason, here we are talking about Clearspace. We haven't done that before. So, you know, shout out to them for doing it. That's the big lesson here is you can create a website that's adjacent to what you're doing in a clever way. Simply design it, vibe code it.

and they know the dynamics of shame. They know public competition, time to beat, you know, your best time, yearly average, best weekly average, you know, putting yourself into a pedometer group, which I think Fitbit and some other people did early on. These things actually work, and then people want to share it. So, and when you sign up, you're going to give them your email. So this is a great idea. You should be thinking about this for every startup you do.

Com.com was the master of this. Alex created a website that said do nothing for 60 seconds. Reset the 60 second timer. It was pretty famous. He also did the million dollar homepage where he sold. He made a 1000 pixels by a thousand pixels, I guess would be a million. And he sold each pixel for a dollar.

And it turned out to be an interesting business. So you can link them. So these little devices are just really great at driving folks to understand the problem in your space. So always think about like a simpler, hookyer version of your product. There's the million dollar home place. I'm just showing this for folks who were too young when this came out. But like this was a big deal. This was like a viral hit.

People tried to make copycats of this. They didn't really work out. but Alex Chewy, who later went on to build calm, is kind of a hitmaker, Jason. He's kind of got that might as touch to him. Yeah, it's a viral thing. And this is a viral thing. It's probably, when you do these things, it's probably not going to work. But if it does work, hey, you may get people talking about it a whole bunch.

So good job for them. It's a thing we talk about a lot in Founder You. We have a launch as well. There's a company that they sell billboard space and they created, they go on Reddit because they've got this billboard that they actually own so they can put whatever they want on it. So they go on Reddit and put different kind of messages on it to go viral on Reddit and use that to like grow interest around the company. Right. So gimmicky, fun things that are going to go viral on the internet can be a great way to like promote your company even if it's not directly related.

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60,000 businesses trust open phone. I am one of those 60,000 open phone, is offering twist listeners 20% off your first six months at openphone.com slash twist. That's O P-E-H-O-N-P-H-O-N-E.com slash twist. Open phone. No-miss calls, no missed customers. Yeah, no, I think that's brilliant. I mean, billboards are a big deal in kind of Silicon Valley culture, Jason. I think we all recall the ask your developer billboards they ran back in the day that really kind of put them as a developer first company that worked quite well so lots of fun to be at yeah it's uh the way to do it with the billboard would be to come up with some funny use of it to put up there well that's what they were doing on redid is they actually asked this reddit community like what do you guys think we should

put on the billboard and they would take pictures of the billboard with whatever the messages the community too basic uh the best thing would be to hashtag your tweet or your Instagram, a billboard, and then put something on there like, if it hits 100 retweets, then it goes on the billboard, and then say that. If I get 100 retweets, this goes on the billboard. So now you've created a viral loop, right?

So, you know, what should we put on the billboard? Doesn't create any virality, but coming up with a contest to do it, or if I get 100 likes or 100 retweets, then it goes on the billboard. That would create more of a loop, reason to come back, right? So that's the virality piece of it. I saw some folks talking about this Google Stitch thing and looked incredibly, yeah, it looked incredibly compelling to me. Maybe you could share that with folks here. Yeah. So Google had its I-O developer event just a couple days ago,

and they released Jason roughly 55,000 things. So I think we're all still digesting each element of what Google put out new models, new image creation models. new video creation models. One thing they dropped was a product called Stitch. And this is not something that's entirely brand new. It is tell an AI what kind of website you would like, and then it'll generate something that's along those lines. What's cool about Stitch is that it has a button that says edit and Figma. So if you're a Figma person, they're really setting this up to be a quick loop between ideation, AI generation, and then human editing, which I think it's kind of a cool thing. Now, Nyati Sol had a pretty

bullish tweet about this that we saw. I'll just show that to give her credit for this. She says that it's absolutely mind-blowing and that now the potential is endless. There's no excuse left to not build stuff. So, I this morning went and gave it a try and let me tell you, it wasn't great.

I'm not going to lie. It was kind of a left-down. I think your prompt was pretty bad. A newsie weblog newsletter design for caution optimism.com. That is punchy, serious, and calm. you gotta do something a little bit more thoughtful than that. Like just redoing a blog is like a very base thing.

When she did it, she was look at her prompt or like the result of hers. Hers game out really gorgeous. But, you know, the bigger point here is, there's another job, UX that I think everybody's going to be able to do.

Now, that doesn't mean everybody's going to be able to do it perfectly. But let's pull up her design because it's a little more than just redoing a newsletter page. She did something that was more like, let's build an app. And I think that's where it really shines. And as we saw last week when we did the, yeah, here's hers for those of you watching on YouTube. And can you see her prompt if you click on it? If you click on the image Yeah, I got it. Mobile friendly home for a marketplace of handmade ceramics and pottery with a minimalist

op theme, and then she refined it. The home screen for the ceramic and pottery marketplace app features a minimalist dope theme with a search bar, a featured artist banner, curated collections, and a bottom navigation bar for easy access to different sections. Yeah, so with a little more robust prompt and then a follow-up, you can see, like, if a designer getting paid 50 bucks an hour on Fiver or, you know, one of these marketplaces submitted this, I would say that would be what I would expect. And why is that important?

Well, I think probably most startups, that's exactly what they do. They design with a $25 to $50 an hour offshore designer that they find on Fiver or what are some of those other sites where you can get like freelancers, dribble, B-Hance. Upwork. Upwork would be the big one. Yes. Sorry, that was the one I was thinking of. So you go on Upwork and, you know, you find these designers who I would say are good. copying other common designs and being inspired by other designs.

We talked on All In, I think last week, somebody stopped me who worked at Apple on the airplane. It was like, you trashed us last week. I was like, where did I? I was like, get in line. Who did I trash last week? And he's like, Apple. I'm like, I don't trash Apple. I love Apple.

What are you talking about? He's like, art design. Johnny I said he stole everything. I said, well, no, I said he was inspired by Dieter Braun. So It was Sacks who was arguing that he's a talentless hack Who didn't really do anything You were more in the middle

I think I was in the middle of the other two guys were laughing Sax and I were back with our pick and roll We were What happens is when Sacks and I get going on something like that He's like, is it? Was he a media creation? I'm like, interesting Yeah, let me get it on this Yeah, Sax's contention was Jody

I've never done anything good a pure media creation. Jason was more like the moderate position. Like maybe he never did anything good and just ripped off all his ideas, but maybe not. Maybe there's something to it. Oh, well, I was like,

maybe that's what great artists do. Is steal. So I gave it a backhanded column, but the point is even the mighty Johnny I have copied everything Dieter Braun. Is that his name, Deeter Braun? No, Dieter Rom, he worked for, Braun is the, I'm sorry.

That's why I got it. It's Dieter Ram? Yeah, I believe Dieter Rom is how you'd pronounce. Rom. is how you pronounce it. And he worked for Braun, you know, like the shaver, but they did many other electronic devices. When you see them type of-seekers and yeah, yeah. Transistors.

So once again, we just eliminated a line item from the costs of running your startup. That's, we're here on this week in startup. I was like to go back to that angle, gentlemen. You now have two tips in the first 10 minutes here. Number one, if you create something viral and you put these two things together, like a, make me a gorgeous website that tracks your iPhone usage that's in a retro style and that has short URLs and boom, you do that. You could have vibe coded this over the weekend in like a day or two or in a day.

This is probably $5,000 to $10,000 worth of spend of your 125K incubator check, just like signing your safe note or convertible note and having an attorney review it. was $5,000 or $10,000, making a marketing plan, you know, writing some code on the margin. So we're seeing each line item get abstracted. So if you want to come up with a good startup idea, what are the things that people used to spend money on for their startup, recruiting somebody, acquiring some customers, creating a community, creating your designs, doing PR, sales development, raising money itself, that whole money raising process.

So look at each of those in terms of the number of hours they take or who you might pay as a consultant. And then I bet you be able to start up around every single one of them. Yeah. One last point about this. When I was playing with the Jason refining my initially weak prompt, I did discover that it won't make desktop websites. So I was stuck in this mobile world.

And I said, hey, can we actually just swap the desktop? And it said, no, you have to start a new thread for that. So I did. And then it said, you can't do that start and new thread for that. So right now, a little bit limited. But again, I also think Jason, it shows that Google really wants to do everything in AI. Like, they're trying to flood the zone here. And apparently just some success.

So points to do Sundar and his team. I got to say they were behind an AI and now we keep talking about him. So that's all. And as you can see here, we've shamed Lon, Alex, because of his prompt. And it worked. He's going to do better. His prompt will be better next time. I think prompt shame is the next big thing.

I mean, if you get people to use AII, we should be looking at people's prompt and saying, really, that's the best prompt you can do. This is what doing extra. This is what doing extra and it gets you on Twist. You see a thing and you think, you know what, I need to test this out myself. I'm not just going to take. I'm not. It's okay, Alex.

You did a completely serviceable job. That, by the way, in Jason's speak, is, is, is, uh, is, uh, is, Fin-ice. It's serviceable. Congratulations on doing the bare minimum. The world of tech startups is a whirlwind. Man, you've got to navigate financial management, global expansion, and of course, strategic growth.

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Visit cLA connect.com slash tech. And don't forget to mention that your boy, J-Cal sent you. That's cLA connect.com slash tech. Start today. Now, before we get into the next story, Jason, I thought we'd take a quick polymarket break because I know your beloved nicks are now down three one. Oh, no. If I recall correctly. So I wanted to bring to you the polymarket odds for them making it all the way to become the NBA champion.

I'm sorry to say, Jason. You're about to be disappointed. 3%. And last week we brought up a market that was a little bit light. Jason, this one has $1.7 billion in volume. So I think it's nice and deep. Do you think the Thunder are 78% favorite? That's my question.

They're up 3-1 as well, or 3-2? I think they're one. Yeah, it might be 3-1. 3-1. So they're both 3-1. And so, oh, this is NBA champion. So, by the way, this is going all the way. So this is not only winning this round, this is winning the championship.

Correct. Wow. So the Knicks have to win seven more games to win the championship. Yeah, this is the right odds, I think. Indiana Pacers need to win five and Oklahoma City need to win five, right? The one game close out the series and the four to win the next.

I think the Knicks have squandered their best chance at winning a championship since the Hakeem Elijah won series when we lost because John Stark couldn't hit the side of a backboard. But, you know, there were many reasons We could have won that series.

But yeah, we could have been in the finals, so it's incredibly frustrating. But, you know, this is life. And I'm excited we got to the conference finals, but I just want to win the next game. I just want to win the next game. Nearly every sports team does not win their season, right? So do you feel like happy as a Knicks fan

if they make a good deep run in the postseason? Or is that just more like a teaser that makes it worse than they lose? Right now it feels pretty bad. And because the coach of our team, this is kind of interesting for startups as well. He, something worked like he has a short rotation kind of concept. So in basketball, you have a 15-member team. You can only play five.

Those are called the starters at the top of the game. And then you can rotate players. And typically, I would say the average team plays eight, nine or ten players a game. He has always played a short rotation, six, seven players, right? He never gets the eighth or ninth unless it's garbage time. Meaningless game, he might put some people in. This has led to his players famously getting injuries because he overworks them. And also this year has resulted in them having incredible stamina.

But what it does do is you don't get to see all the possible lineups and you don't give some emerging talent the ability to develop. So when we got down two games in a seven game series, he hadn't tried out a lot of people on the bench. he hadn't tried out different rotations. And so then he starts experimenting with rotations in game three and we win. And we had some really nice moments where we had to not belabor the point, spread out a little bit of the minutes and try giving different people the opportunity. I do this inside of our venture firm. Everybody wants the starters, the high performers,

constantly get the same opportunity because they have done really well, being the point guard, the center, the wing, etc. What I do is every six months or 12 months, I will change who's in charge of Founder University, the accelerator, the syndicate, or working here at launch or working directly with me as a shadow. What that does is it lets emerging talent get the chance to prove themselves. It gives them their 20 minutes in the game, 15 minutes in the game. And yeah, what's the downside? They fall on their face.

They cause chaos. They're not very good. You know what? I kind of want to know that quickly so that I, can stop investing in that person, or I can invest in that person and get them better because the mistakes they're making are fixable, right? It's one or the other. Here's how you do that. You tell everybody at the start, you're going to work on a project like Founder University. Jackie worked on that, for example. A guy named Charlie then took it over from Jackie. He added his own spin on it.

It went to another level. That's no dig to Jackie. You know, and then Kelly worked on it, added some things to it that made it even better than it had been under Charlie and Jackie. And now Lucas and Lon and some other folks at the headquarters are running it, it's doing even better. And what happens when you move people around as well, you have redundancy. You're not reliant on one person. So if one person is not bringing it, you got this other person is bringing it. This happened to the Warriors. They had older players who were, you know, in the twilight of their career.

you had younger players, Clay Thompson and Draymond Green. As they came off the bench and got minutes, you were able to give them room to perform. But that also did was, you know, if some older person wanted a huge contract, you were like, you know what? Are you worth that amount of money? Or is this younger, up and come or worth giving the opportunity to? And this sounds incredibly cutthroat. And it is. And as business is. So if you are looking for, for yet another startup lesson, you know, look at the bend and give the bench an opportunity. A hard agree with that.

Also, it makes more more fun games to watch because you get to know more players and you get to see kind of more, I don't know, playing methods. I've been watching a lot of WMBA lately, so I've gotten to see some of this, Jason. All right, Jason, you wanted to talk about the biggest deal of the week, which is Salesforce is buying a company called Informatica, which is the most enterprising sounding name of all time. before you jump in here, I'll just let everyone know it's an $8 billion transaction.

And Salesforce, as we all recall, is a company that pledged back in 2023 that I had disbanded. It's M&A committee. I was going to pull back for mega deals. And then about 20 minutes later, Mark Benioff was like, well, that's boring. I'm going to go back to doing deals. Tried to buy the company last year. Didn't work out. And now it's scooping it up, Jason, for about $3 billion less.

But no matter what, we love to see some M&A, even if it is a couple of public companies. Okay, so one simple sentence. I always like to know what the company does. So what does this company do? And what's the thesis? Do we have a handle on that? We do. Okay.

There is. I'm scrolling through my, I wrote this down, so I knew you were going to ask it. Always start with that. Like, I think it's just important for the audience to understand, especially the founders who are watching,

why is somebody buying a company, right? It is interesting, I think, in terms of context, that Salesforce during the wrath of Lena Khan gave up. Did that really happen? Did Benny Off say we're disbanding our M&A? That was back in 2020. That was back in 2003 because he was under pressure by outside investors to stop doing so many

big deals. They wanted him to focus more on cost cutting. And then he went back to doing deals. Oh, so that was because he was feeling pressure from activist investors, not necessarily Lena Khan. But I bet you the outside investors were like, listen, it's not going to get. through anyway. So what's the point of all of this to try to even buy things, spend years doing and then having like Adobe having the Figma deal canceled? So I bet you that was why the activist

investors who wanted him to lay people off and get the earnings to spike, you know, and thus get the stock price to spike. So tell us what is Informatica? All right, informatic. Informatica does corporate data organization. It helps companies find out where are there data is. It helps them figure out the governance for it. And also to make sure that they're doing good data observability, Jason, which is making sure that your data sources are accurate and not spitting out complete garbage. Now, that's pretty boring, I think, in a pre-AI world. It's a lot of buzzwords. Corporate data organization, observation, and governance. I'm trying to even parse what that means, but okay, you got a lot of data in your organization. We're going to somehow organize

it? Yep. That's their goal is to go figure out what you have, help you organize it, figure out who's allowed to look at it and interact with it, governance, and then also make sure that your inbound sources are not polluted and full of crap. If you're a startup founder, you've got a million things that you're worrying about at this moment. You know what you shouldn't worry about? Your bookkeeping. Your bookkeeping should be perfect. And you should have a partner who makes sure it is so. And that partner is pilot. It's the industry standard. Pilot is the largest accounting firm out there built for startups. They know how high the stakes are.

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Just go to pilot.com slash twist. That's p-I-L-O-T dot com slash T-W-I-ST. Interesting. As opposed to using the SaaS-specific SaaS products, this would do it across many SaaS products. So they would take your Salesforce data, your HubSpot data, whatever, your Slack data, your Google drive, your email, and be able to look across all of it.

Okay, I think I get it. Got it. Now, that was an important bit of work in the pre-A. world, but now I think it's much more important because everyone wants to use their internal data in an AI context to automate tasks, learn more about their business, and so forth. The context here for Salesforce is that the company's growth has slowed. Salesforce is growing 8, 9, 10% a quarter, even with some relatively large acquisitions, Jason.

So my thought here is, as Salesforce pushes more and more into AI and AI agents, they need to expand the TAM and get out of just customer data. And so working with a company like Informatica will give them access to a lot of customers that have non-CRM data and therefore they can apply their same agenda technology, back to the buzzwords, across a broader set of problems. And so I think it makes some sense. And it's only about a 3% market cap deal for Salesforce. So it's not a bet the farm style transaction. Interesting. And we've been tracking a lot of MNA here.

Do we make our MNA tracker or maybe you could just tell the audience, like what we're? of the stuff, because we, there were, off the top of my head, I remember there were two purchased by DoorDash. Then you had two purchased by OpenAI. So that was four deals. Those four deals, I think, were all billion dollar, low billion dollar deals. So we're starting to see a trend of single digit billion deals happen just in the last 30 days. You had the cursor competitor bought by OpenAI I, you had Johnny Ive by Open AI, 6.5, and I think the other one was three billion. Am I about right? Yeah, so the windsurf deal was $3 billion, but I still think that has not been officially confirmed by the company. Okay, so that's in process.

Then you had the Johnny Eye. Then you had DoorDash bought two companies. I forget which ones those were, but I think they were also $1 to $5 billion. Am I correct with those? There were smaller deals, yes. It was Deliveroo, wasn't that one of them? Yeah. Deliveroo and there was a smaller company.

I think delivery was like $3.3.5 billion somewhere. Yeah. So a direct competitor, but in a smaller market in the other one. Also, by the way, here in Singapore, it's a graphic. world. I opened up my Uber eats. I opened up my Uber and it was like, yeah, Uber forwarded me to the Grab app, said, we are no longer operating here, but you can use our partner Grab. So I think this is one of those markets where they gave up and then got a percentage ownership in the you know, domestic player, in this case Grab. And yeah, you have to download and sign up for a new

app, which I did. And there were two interesting observations I had about grab. Number one, it sells insurance to customers for 30 cents a ride. And the insurance protects you against the Uber, the grab, arriving late. And if it arrives late, you get like five bucks or ten bucks. I'm like, who's buying this? This makes no sense. But there it was. Or if you're late to get to it, then you don't pay the $5 fee, which I got dinged with the $5 fee because they will not. not pick you up and a grab, it's such a high functioning society here, that all of the livery cars have to go to specific locations located throughout the city to get into the car. So I had to go to like a garage lobby to a hut to get my car and it was a block and a half away.

And it took me a couple of minutes because I went to the wrong place. So I thought it was super, super interesting to have that experience and see some little bit of a different take on how these things should operate. I would pay for the insurance. Weird, right? Insurance for, I almost feel like it was like a little bit of gambling, like I'm going to bet 30 cents to make $5. That's exactly what I was going to say.

I was like, do you think because gambling is so popular there that they've sort of started to integrate the idea of insurance into, because that's like, it's like blackjack. That's exactly what I was thinking. Well, it's sort of like polymarket too. Like, polymarket, you're getting insurance. So if I bet that 3% and the nix. hit, or if I were to bet the Pacers, then I could have the joy of knowing the team that beat us

eventually won, so we lost to the champion. So I would get like some, yeah, I hate those kind of bets. It just makes me obsessed more sad twice. The reason why I would buy the insurance is I still sometimes run into the problem with Uber in which a driver will accept the ride and then kind of like not drive towards you and hope that you cancel. And I understand the dynamic turn. The slow roll, the classic slow roll.

Yeah. But if I had insurance. I don't like the slow roll. I always complain about the slow roll. It hasn't happened to me recently. When's the last time you got a slow roll? Two weeks ago, I was trying to leave the poker room and I was trying to Uber home. And the driver was like, we're going to play chicken.

And I'm like, yeah, I got time. Let's go. Like, so I just waited him out. Jason, back to your question, though, about M&A. I want to share a couple of data points that I pulled for everyone this morning. First of all, a reminder that we are still in a historical low period for M&A. This is a chart I'm showing on screen from KPMG that just shows venture back to exit activity here in the U.S. And while the first quarter of 2025 with $56.2 billion

in known transactions was the highest since 2021, it's still Jason not exactly where we want to see. And it's lower the numbers we saw back in 19, some parts of 20 and also 2021. So it's still a bit depressed. That's three quarters of increase and it's going to be a blowout second quarter is my prediction. I think we might see that number double. You heard it here first, folks. Well, we have some more data because I was trying to do some work on what's happening in Q2 because Q2 is still ongoing, but just over the halfway mark, I wanted to bring some more new data to the table. So I went ahead and did a bunch of searches on Crunchbase and there is a meaningful uptick this this year, but I was doing my own data work.

So I also grabbed some data from E.Y, our dear friends over at Ernst & Young, and this is U.S. activity in terms of deals over the $100 million mark in April. As we're seeing here, the growth in deal value is up 100% April of this year, Jason, compared to April of last year. So I think a very strong start to the second quarter. Okay. So the deal value is up massively. The number of deals is down slightly, is a little.

Is that what I'm reading into here? Yes, 34 versus 42. So the dollar, so that makes sense. What that would indicate to me is maybe some of those deals that happened previously were aqua hires, low value deals, clearing out some inventory. The company's worth acquiring, but it might not be able to survive as a standalone company with venture investors on the board. But I will tell you, I've now had to make like three decisions in three weeks about, you

approving two different sales. and then getting offered secondary during a like series B, let's call it. And so this is three delightful moments for me. Well, I should say like one of them was a sale that I was displeased with. You know, one is a sale that I'm okay with. And then one is a secondary sale that I am, dare I say, if we were in my group chat with other investors, I might put an eggplant emoji on the... Which is what grown men do in my adult chat is.

It means I'm excited about this. I'm excited. I'm enthusiastic because in Italian culture, everybody knows, the side of eggplant is a sign of being excited. The eggplant parmesan, the king of side dishes. Absolutely. It's just an eggplant parm homage. Let's not read into it anymore.

than that. Sometimes the promo code twist and J-Cal for your hymns prescription. I don't think you have an egg plant is the worst vegetable. It tastes like garbage. I don't know why people like it.

Oh, spicy taste. Horrible, terrible food. Lon and I am making fun of Alex is now turning into a dynamic like me and Shemot beating up on Freedberg.

We got a scale back. I agree. Guys, I have a two and a half-year-old. I get flamed all the time. I'm going to get an Alex impersonation that has

nothing to do with Alex. I actually did a little comedy when I was in the Catskills as a child. Is that what I sound like? No, that's my nerd. That's Dave Friedberg. Oh, okay. When he laughs at himself, but he. Yeah.

This makes me. I like this twist format. We should have Jason B 12 hours ahead more often. This is fun. I am definitely in La La Land because I was up all night. the middle of the night and now I'm going to be in this weird position where I slept for five hours, got up at 10 p.m. to do this and then yeah, moving on to that. I want to keep the deal flows back. I think Lena Con will be working at a venture firm. A woke venture firm

will hire Lena Con. I don't know which is the woke. Oh yes, there are. Wow. Oh, big time. Big time. Yes. It works when you look at their socialists. team, no, you're going to look at their team page and it's going to look like a Benetton ad. And then when you double click on it, everybody has the same title partner. And then half of the people who are diverse do not have checkwriting ability. I'm not calling anybody specific out. Oh. Well, that's interesting.

Because is that, is that woke or is that performative? Because I would say. Performative woke. Right. Like, that's not, like, if you're actually woke, you would just have a diverse. group of partners because that's what you wanted in your organization. It wouldn't be a publicity stunt. But what you're saying is it's actually performative. It's not really. They're not low people. They just want everybody to think they are. You know what,

F it. I'm going to go for it. I'm going to, you know, I'm a little loopy move here. We can always cut this out later. No, I'm going to let it go. I'm just going to let it go. I'm not going. Here's what happened in the industry. TechCrudge, your alumni of, and I was formerly partners with in year one. We did a conference together for, yeah, that's stuff happened. Anyway, I went to it when I was a baby. Yeah, yeah. Yes, it was pretty great. I remember those days. Yeah, the crazy thing that happened was TechCrunch riders, which became like, you know, after the leader of TechCrunch kind of disappeared when, you know, kind of went into the crypto world, it got kind of taken over, became a little woke like most of the Valley did

during that time period. Hey, and what they did was they would screenshot people's team page. and be like, look, five white guys, you know, and, you know, two Asian receptionists, right? They literally would write stories like that and dunk and be like, oh, you know, look at the diversity problem. Then I literally was hanging out with VCs at a dinner, no less than 12 firms at this, like, group dinner. And two or three of them are goofing off laughing at the corner. And I said, what's so funny?

They're like, oh, we just like, we hacked tech crunch, like literally. And I was like, how'd you do that? They're like, oh, well, we, we now, everybody in our firm's a partner. And I said, what does that mean? Everybody's a partner. Like, don't you have like levels? Isn't there levels to this game? They're like, are there?

Yeah. He, he's like, yeah, I get it. I get it. Are there? Yeah, there are. There are like, you're like a researcher or an analyst, associate. You're a principal. You're managing director.

You become a junior partner. The hierarchy. You move up the hierarchy. The hierarchy is exactly like how that works. They're like, does it have to work that? way? I'm like, I don't know. Like, well, I'm like, so they show me their homepage. And they're like, yeah, we hired two black people, three Asian people, a trans person, like literally went on a hiring spree for the most entry level positions, created a scout program essentially, where they gave them

the ability to, oh, and they hacked it too to be, you have check writing ability to write 50K checks. out of the scout fund in a billion dollar fund. Right. And literally TechCrunch is like fawning over the diversity of one fund and crucifying another for this. They literally hacked it and nobody ever double-click on it. This was always the issue with DEI.

The attacks on it have been, it's unfair to white people or it's not a meritocracy anymore. But the real problem is it was never sincere. It was always, a front to get better press coverage. It was never about making the companies actually more diverse. Very few people in business are in it for moral reasons. People are in business for profit reasons.

Now, the partner point that Jason's making is actually interesting because we did notice. I mean, we weren't stupid. But when Andreessen Horowitz just declares that their entire firm is full of partners, it does obfuscate really, really deeply who actually can write checks. Oh, there's a name shout out. Ooh, spicy. Alex shouts them out. I didn't say any names.

You were talking about, Andrews and Dr. I said no names. I'm at a table with 12 VCs and a group of them are talking about how they hacked Techrent for making everyone a partner. I mean, that narrows it down, Jason,

to just a couple of firms. All right, I want to talk about Circle, Jason. We have been going on about stable coins add nauseam here on Quist, and I just want to point out a couple of quick things. One, we now kind of know when Circle's going to go public. It's going to be, I think it's June 4th, followed by a June 5th debut.

And also, we have some pricing information. We now know what circle may be worth when it does list. They have put a $24 to $26 per share target on their IPO, Jason, which at the midpoint gives them a valuation of about $6.2 billion on a fully diluted basis. Now, I tried to figure out, does that number make sense for us? And I actually ran into an interesting accounting problem. So they're kind of gross revenue run rate, puts them like a 2.6x multiple at that price. Gross revenue, which is the interest generated on the holdings of the stable coins, I'm going to guess.

Yes, that is the vast majority of their revenues. They could have fees as well, right? So if we were looking at a bank, a bank might have fees like late fees, overdraft fees, etc., up, gold card fees, right? I have a platinum card. I'm paying $800 a year for like an idiot from American Express just so I can get into the Centurion Lounge, which I'll probably use four times a year. So it costs me $200 each time, which now I feel like an idiot, but okay. Maybe it is worth it. So the other one would be the interest on the float, which is also how a bank works. Okay, got it. Now, just to be clear, their quote, reserve income, which is their interest-based

payments from holding treasuries and so forth, is the vast majority of their revenue. 80%, 90%, I'm I'm going to guess. 95, 96. I'll show you the income statement in a second. But where it gets a little interesting is distribution and other costs. See, what I think is not as well understood is how tied Coinbase and Circle are. And the terms of their agreement are that if stable, if the USC, the chief stable coin from Circle, which is pegged to the US dollar, if those exist over on Coinbase's platform, Coinbase essentially gets the money. which means, or half of it or 80% of it? As far as I understand it, going back and reading through the S-1, I still need to do a little bit more research here.

It's the vast majority of it. So that ends up with a big chunk of the gross reserve income that Circle generates from holding the backing currencies and bonds that back the stable coin going somewhere else. And you know how we think about Google's revenue on a X traffic acquisition cost basis? We might want to think about Circle in a. an X distribution cost basis because they essentially pass through a lot of that revenue. All that's to say that GMV is not revenue and you do want to pay attention to net revenue versus gross. So in this case, Jason, if you strip out the amount of money that they're paying to Coinbase and so forth and just get down to their kind of like adjusted revenue, it's like a 6.7x run rate multiple for today,

which I think is pretty reasonable for what is effectively a bank. Yeah, that's literally what stable coins are. They're a paying. Yes, but not because they can't give you money back. And we touched on this before. I just want to double click on this because in the Genius Act, there is a prohibition on stable coin providers under this, it's going to pass bill that's going to regulate all stable coins in the U.S.

You cannot offer a payment of yield or interest on an issued payment stable coin. So Circle is safe. from being undercut by people who are going to, you know, give back 90% of the revenue. I think this is the part that's going to change pretty quickly is there, in order for this to work, you need to get paid interest on your stable coin. So perhaps I'm trying to think of why the government doesn't want to give interest on a stable coin. I'm thinking it has something to do with control over a currency. And maybe that's the last piece that are a sovereign. country has to incentivize people to keep dollars in their currency, which is you can get interest on it.

If you can get load-bearing interest on your stable coin, well, then it's no different than a dollar. So maybe this is their way to differentiate, but I think this is going to mean people are going to keep very low amounts of dollars in this. But there will be an amendment to this, and there'll be a way in which circle can pay the interest, I bet. Not circle, I'm sorry. Coinbase as the partner can pay yield. There will be a yield product. I don't know how they'll do it. Maybe it's with loaning out the dollars or something.

There'll be some complex way of making money on this. And this is a way for them circle to block other players. So you might want to, you know, give free deals to the top three markets, cracking and circle and Coinbase and whoever else. and then maybe everybody else gets charged, you know, less. So, one way, another way to think about this is on the Coinbase, Board of Directors, Coinbase makes a lot of money from stable coin yield is Mark Andreson. Mark Andresen has been helping to staff the federal government and has influence over policy and so forth.

So I don't think it's a huge shock that the companies that he is representing are getting kind of a good deal here. Welcome to capitalism and democracy, everybody. But I do think it's going to be interesting to see just exactly what you're saying. What is the innovation that comes next? But I do think that the genius act looking the way it does now is going to help Circle get public because there's going to be at least near-term confidence that their business model won't be undercut by a nascent rival who can just essentially say, well, we're going to give all the money back and therefore Circles revenues go to 10%.

So encouraging, I'm really excited about this IPO. We had Jeremy Allaire on the show. I'll have that link down the show notes. I just, gosh, it's so good to talk about some real exits and talk about pricing, Jason, instead of just, you know, Lena Kahn. Here we go. This is why this is the lesson for the side that lost. If you are anti-capitalism, if you are anti-business and you plant that flag, don't be surprised when a bunch of business leaders who backed your before move to the other team

who's saying, we're going to let you do M&A, we're going to let you go public, we're going to get rid of regulations of which there are far too many. You can debate which ones you want to get rid of. And by the way, you gave a bunch of money to that side and they left you at the altar. Give us a bunch of money and we're going to bring in the tent. Big lessons for certain political parties. Build a big tent. Listen to the business community.

The business community are the ones who build stuff in the world. Yeah, there are artists as well, but a lot of that art winds up with a little bit of commerce. If you ignore builders, you will lose elections. It might not happen immediately. but when it does happen, it is going to be cataclysmic. I cannot lie here and say that I am not absolutely thrilled with this administration's approach to M&A, IPOs, and regulation. I am. I wish the Democrats were like Clinton and said, you know what, business matters, jobs matter. We understand M&A is a big part of monetary velocity and part of how capital gets allocated

is the expectation that you can buy a company or take it public. And if we put that on ice for four years, you're going to break the industry. This industry is literally teetering or was teetering. If this had been another four years of this, I think the venture industry could have broken and would have been like half the size it was. That actually was a realistic possibility. So this is a message to Dean Phillips and my other friends in the Democratic Party. there is a path here.

Cherish business leaders and capital allocators. Yeah, but you know, this is why I think the GOP is going to get hosed in the next set of elections, Jason, because what business leaders want is consistent rules of the road, a lack of trade barriers, stability. And we've had one of the craziest hundred and some days now of this administration. And by the way, on the M&A front,

I just, I think they're getting credit they don't deserve. Like, you saw the U.S. Steel deal that's now a huge mess. and the government's going to take a golden share like it's literally acting like China. How much are we getting, by the way? How much are we getting? That right there, the sort of gangster capitalism in which Trump is literally god king of the world

and hitting Tim Cook for not going on vacation with him to the Middle East. This is the most vindictive and petty administration. So I think you're correct in the bets that were made going into the election. I'm not sure that everyone who made that bet is going to be content enough to make the same wage of twice in a row.

Late breaking, Joby Aviation. shares up 20%. I was going to do a J-trade at four or five, six bucks because I was in the Middle East and everybody was talking about Joby coming to UAE and that you'd be able to go from Abu Dhabi to Dubai to, this is years ago, maybe three years ago, Abu Dhabi to Dubai. It was a SPAC who went out at $10. And I was following this company because I said, this is going to work. And it was at four or five or six bucks. Oh my gosh.

People are in this like copter thing. Are you looking at, I'm looking at the first page of their shirt. vertical takeoff. There's your older letter. Yeah. It works. Yeah. These things are common, dude.

I mean, I, no. I would like to try one, but it does not look like that thing is going to stay in the air to me. Like, it's a miracle. Better than a helicopter by a hundred. And probably it'll eventually be safer than an airplane by 10x. And do you want to know why? I believe you. I just, it does not look like it would fly.

Please. Take a guess. Why would the quad copter? like this. And you can see a video of it here. There, there it is. Yeah. Why would?

When it flies, those, those propellers are facing forward, not up like a traditional helicopter. Right. They face forward so it can get horizontal, right? As opposed to vertical. So it's vertical take off and landing. When it flies,

they tilt forward and you get that. Exactly. But why is it safer? I mean, I'm guessing it's the multiple propellers rather than just the one. If you're in a conventional helicopter, that one propeller messes up.

You're dead. This one, you got backups. This one, if you look at it, you not only have four engines that can counterbalance each other. There are two rotor sets on each, and I believe there are two engines. So they're stacked. So you could have, I think it's something like five of eight or three of eight. Like you could have three of the eight propeller engines go out because it's eight engines. They still be able to sort of bring it in.

Easily. You could finish the mission, I think, losing three of eight. And I think you could easily land. with half of them. And so if they start going, and you're not going up that high, these things are meant to fly, I believe, you can look it up at like one to five thousand feet. These are not meant to be at 10,000 or 20,000 feet. What is the height they fly at? I said a thousand to five thousand. Oh, it's about, it looks like most commercial flights are about 5,000 feet or below. It's capable of reaching 10,000 feet, maximum cruising altitude, 15,000 feet. Yeah. So they'll be just literally zipping

New York Harbor, you know, around Singapore's Bay, Sydney Bay, and they'll just fly over the water. They also make no noise. So the big complaint about helicopters in New York is the noise level. I know that Toyota and some other folks have backed this previously. They see this as a major future place. And there was Archer aviation that also SPAC. These two companies are the two companies, I believe, that will come out of the SPAC era that could be 10 baggers out of the SPAC. Terra. What's the market cap on this thing now? Because it went up 20%, raised 250 from Toyota. Joby is worth, as of now, just about $7 billion. So shout out to them for a basically pre-revenue company. All right, everybody. This has been another amazing episode of this week in startups.

I'm in Singapore. There's going to be a meetup on Saturday. You can go to Get River or follow us here on TWA. Startups. Follow me on Jason. They'll announce the details today, I think, if you're interested on Saturday, Saturday, this Saturday in Singapore. This Weekend Startups all in joint meetup. A bunch of fans are coming to a food court. Thisweekinstartups.com, YouTube.com. Search for us and we'll see you all next time. Bye-bye.

Bye-bye.