This Week in Startups - SoftBank's Vision Fund loses $21B+, DTC brands struggle + NutriSense CEO Alex Skryl | E1529

Episode Date: August 9, 2022

Jason breaks down SoftBank's Vision Fund losing $21B+ last quarter and reflects on how founders should approach raising capital from megafunds. (2:11) Then, Jason reflects on lessons learned from the tough DTC space (27:05) and gives a quick Jay Trading update! (36:17). To wrap, NutriSense CEO Alex Skryl joins J+M to break down the benefits of continuous glucose monitoring! (47:37) (0:00) Jason tees up today's solo news + founder interview! (2:11) Jason breaks down SoftBank's Vision Fund losing ~$21B+ last quarter and analyzes some clips from Masayoshi Son's investor presentation (11:31) Microsoft for Startups Hub - Apply in 5 minutes, no funding required, sign up at http://aka.ms/thisweekinstartups (12:54) Jason disagrees with Masa's new strategy and direction and explains how founders should approach raising capital by megafunds like the Vision Fund and differences between how Uber and WeWork deployed SoftBank capital (22:46) Assure - To get 20% off your first Special Purpose Vehicle (SPV) visit https://Assure.co/twist (24:06) Reviewing the biggest hits and misses from Vision Fund I (27:05) Lessons learned from DTC shutdowns, how VCs deploy capital in a downturn (34:45) Prometheus - Go to Prometheusalts.com or download it on the App Store and use the access code TWIST to sign up (36:17) Jay Trading update: $DIS, $AMZN, $WBD, $SFIX (47:37) Nutrisense CEO Alex Skryl joins to talk glucose monitoring benefits, biohacking, and more!

Okay, everybody, Molly's on vacation. But first up, we have some solo-dolo Jason News. SoftBank has reported the Vision Fund had a $21 billion investment loss last quarter. D-to-C beverage brand house does not have enough cash to Kenya operations. So we talk about how investors look at their portfolio and make tough decisions in this kind of a market. And then we go through my J-trades. Ford trade so far. You got Stitchfix.

You got Amazon. You got Disney. You got Warner Brothers Discovery. One of them's up over 16% and one of them's down over 12%. We're going to get into my J-trading experiment. It's not investment advice. And then after we talk about J-trading, we're going to have the CEO of Nutrisense on the program.

It's one of my early investments. They do continuous glucose monitoring, which I believe is going to really help turn around this obesity epidemic. It's going to be a great show. Stick with us. This week in Startups is brought to you by the Microsoft for Startups Founders Hub helps all founders. Hub helps all founders build a better startup at a lower cost from day one.

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That's assure.co slash twist. And Prometheus solves the problem of visibility and access to alternative funds in a way that benefits investors, fund managers, and wealth advisors. Lower investment minimums means that millions of investors can get involved in alternatives and let professional investors do what they do best. Go to Prometheusaltz.com or download it on the app store and use the access code twist to sign up. All right. Now, first story, I think this will be one of the greatest videos in the history of investing. SoftBank reported the Vision Fund had a $21.7 billion investment loss in the quarter ending in

June. If you don't know what SoftBank is, they are the ones who had the Vision Fund. The Vision Fund famously was investing in a large number of unicorns during the peak of the bubble we're just coming out of. WeWork famously, Uber, DoorDash, many different companies. And they were investing at very high valuations, famously $40 billion plus for WeWork. And they exited their entire position in Uber now at a gain, which is pretty interesting. They had the largest venture fund ever. They raised $100 billion. You remember a lot of it from the kingdom from MBS. And Masayoshi-san is been one of the great investors of our time, but to say he is a swing for the fences type investor would be an

understatement. He is a swing for the moon type investor. Masayoshi-san didn't report on job cuts at SoftBank. And SoftBank is a publicly traded company, but it's essentially like a holding company. He famously invested in Alibaba. So those shares are in SoftBank. The Uber shares were in soft bank, the door-dair shares, etc. And based on this massive collection of assets he has, he's able to take loans and then invested in more companies. And so he has been the most aggressive investor in the history of venture capital and capital allocating. And this video where he does his quarterly report, I've literally now watched it. I'm on my second viewing of it. It is extraordinary. We'll play some clips from it in a moment. Here's what the Financial Times article

quoted covering the story said, San, Masayoshi Son, this is his last name, said on Monday that SoftBank would now subject itself to dramatic group-wide cost-cutting extraise after a $59 billion investment gain at the two vision funds almost completely reversed over the past six months. In other words, they were up $59 billion on their investments.

Now, just let that sink in. Almost $60 billion in profits over, like a five-year run, essentially. from when he invested, started investing in Uber and making these huge bets. These were people were incredibly critical of these bets, but some of them did in fact pay off. SoftBank has a $71 billion market cap right now. It's down massively from the peak, well over 50%. And let's get into his presentation.

This is a chart of their quarterly net income and how they've done since 2017. And you can see, you know, they have mostly up quarters during this peak, 2017, 2018, 2019, 2020. These were like the incredible years of this boom and some losses, obviously, because you're swinging for the fences. But oh, my God, the last two quarters sequentially Q4 and Q1 have been disastrous for them. The largest loss in not only soft banks history, but in Japan's history, I think he said. I'm not sure if it's the largest loss in investment history either.

That would be an interesting thing to take a look at. But if you look at how he kicks off the presentation, very dramatically, he showed a portrait of Tokagawa Yasu. This is the founder of the first Shogun of Japan's Shogunate. They ruled Japan for 60 years during the 1800s. The portrait features

Tagawa frowning after losing a battle and having his army destroyed and barely making it out alive. Masa likens the famous Japanese Shogun to himself in this 68 second, very dramatic clip. I'll see you on the side of 68 seconds. This is a portrait of

Tokugawa Iyeyasu, he actually made a big loss against Takeda Shingen and came back. In the background of that, Tokugawa Iyazu had to face Takeda Shingen, which is much, much larger army than theirs. And most of the allies actually said this is going to be the losing battle so that they should not go for it, but actually better to stay at the castle. However, Tokugawa Iyazu didn't want to lose his face so that he gave. get out from the castle, had a battle, made a complete loss and suffered and came back. And that actually learned lesson, he tried to remember and remind his own learnings and put it into this drawing. So since the foundation of SoftBang Group, I made a two consecutive quarter's loss. So previous quarter and this time quarter, consecutively we made three trillion

level of the loss. So in total, $6 trillion was made in the past six months. So I believe I need to remind that myself. Pretty amazing, like self-awareness here going out. And the people of Japan are very humble. They have a great sense of Gehry, of responsibility. And he takes total ownership of these bets. And you, as you're watching it, you're seeing the lessons he learned betting on the late stage of Uber, which wound up being actually a huge hit for him. He's now sold all of his Uber shares, and that's one of the things in the portfolio that's made him billions of dollars. But he also talks about WeWork. And famously, if you've seen the WeWork documentaries, podcasts, Hulu show now that we talked about here, that was a pretty brutal moment of hubris for him.

And so he gets asked during the Q&A. In fact, the first question in the Q&A about what he's learned, his lessons learned as an investor. Now, as a capital allocator going into my second decade of doing it, I started with the company that he bet the farm on, Uber. That was like my big hit, as you know, as an angel, about 11 years ago. And now I'm in my second year as a private market investor. And I've started doing J-trading, which is investing in public companies. In a way, I'm not saying I'm modeling my career after Masayoshi-son, but I am certainly looking at him and saying, what has he learned? Just like I said, what did Bill Gurley learn? What did Michael Maritz learned, what did Doug Leone learn during, you know, these moments of booms and busts and capital

allocation and really understanding how the public markets work and how they value companies and understanding how the private markets work. And then being able to combine them, I think, made you the ultimate investor. I think it makes you the ultimate business thinker because you get to see companies in their nascent state when they're forming and then as they're scaling and they're becoming the largest companies in the world. And that's what I'm trying to thread the needle on. If you're watching the show, you're watching me learn, you're watching me build my team, add people to the team. And this clip to me was just amazingly clarifying because Masa is 65 years old. He is one of the greatest investors of all time. He is absolutely, without

question, the most audacious investor in the history of investing. And so here is just an amazing moment captured. So the lesson I learned are so many, but the for vision Fund 1, we were making a big swings Uber, D-D, we work. We had spent almost 1 trillion level of the investment per case. So we've been making a big swing and couldn't hit the ball. That was happened in the Vision Fund 1 because my feeling was very strong, my emotion was very strong to specific companies or business. So that's something that I learned.

So we became more systematic and also smaller tickets and try to make sure that we have better profitability in Vision Fund 2. So that's why that we became relatively smaller ticket size in Vision Fund 2 compared to Vision Fund 1. So rather than aiming for the home run, but try to aim for first base hit or second base hit, make sure that we have a good hit. So I believe that we were on the kind of a bubble on valuations. So that's all my responsibility as a commander. Amazing. And he says there, he put a trillion dollars into Uber D,D, a trillion yen into Uber D,D, and we work each, which would be $7.4 billion into each company of the Vision Fund.

I'm not sure if that's exactly correct, but I think he's saying approximately. And obviously, that's a translator speaking. That's not his voice. doesn't speak in a female voice. But if you think about that, D.D. got delisted, shut down by the Chinese government. They're in the process of being, I believe, relisted on the Hong Kong Stock Exchange.

And the government, you know, has been really given them a hard time. I think they were too successful, like Jack Ma. Uber made him money and then WeWork was a complete disaster. But even WeWork, he might wind up pulling a rabbit out of a hat and getting to break even on that since he bought the whole enterprise. And it's done pretty well since then. But what's very interesting is, is he says, hey, listen, I got to hit singles and doubles.

Now, he's 65 years old. He's only hit grand slams. Alibaba being the biggest one, Uber being the next biggest one. He's a grand slam slugger who's now saying, maybe I should hit some singles and doubles. That's a moment of clarity in terms of thinking for somebody who's been at this for decades. If you're running a startup, you know that every little bit of help counts between running your team, building the product, getting compliant, hiring people, studying customer support,

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AKA. dot MS slash this week in startups. I disagree with him. Just going to put it out there. If he was up 59, almost $60 billion, and he had just sold a third of his position along the way, if he had trimmed the big winners as he went and banked some wins and build up some cash reserves,

they wouldn't have had this huge loss. This would have been much less to bear. And I think that's the lesson for me is actually, I think his big bets were pretty amazing. Now, you can't make each of those work. And there is a problem with the bubble. The market was very frothy. He came in. He arguably created the bubble. So let's just pause there for a second. He's saying there was a bubble. And this is where I think maybe he has a blind spot or maybe he didn't actually think to say this. In truth, what he should have said was, I created a bubble. I wanted these companies to get so big that I overfunded them. And this is where we must pause and think about the overfunding of companies. We had Tina Sharkey on from Brandless. I think they had received $100,200 million

from SoftBank. A lot of these companies received so much money from SoftBank because they had so much money to put to work. When you have a $100 billion fund, you can't give somebody $25 million. You got to give them more money. When you meet WeWork or Uber, you want to give them a ton of money to try to make them the huge winner to block everybody else to go on this global expansion. So what should you do if you're a founder and you're faced with that situation? The optimal situation is to take the money at the high valuation, but deploy it slowly, which is in fact what Uber did.

Uber kept a lot of that money. They kept building up the war chest. And that gave them the ability to work out all these issues and be the proverbial last man standing, last person standing in this great battle amongst the on-demand economy companies. DoorDash also raised a lot of money from Masayoshi-san, and they also are one of the last people standing here. But we were imploded. So why? What's the difference? Well, we work took all that money and they did not stick to their knitting. What made we work particularly special was that they found locations where there were massively under market rents. And then they convinced

tech people by having a really beautiful modern interior and a culture and a there there, a group of people who were hip and cool, maybe a lot of gender diversity and beer and parties. As you saw in the documentary, it was a specific part of his vision. I'm talking about Adam Newman now was to have a lot of women in the space, a lot of parties, maybe a little gender diversity so people could meet their future spouse or somebody they could date and have this crazy party. They did this so well that they convinced people to put their office space, including my team, which had office space, at the WeWork in the Tenderloin. Literally the worst possible place you could ever have an office was the Tenderloin on Turk and Taylor Street where WeWork had set up

one of their first locations. They got it so cheap that space. And they were probably charging $100 a square foot net net when you looked at what you paid for. And they probably rented it for $20 or $30 a square foot. And they got that huge spread. Then what did they do when they got all this money? He started looking for premier buildings on the most expensive rent districts and then was underselling them. So they flipped their model. And this is where jet fuel, which is what venture capital is. Venture capital is jet fuel. It's designed to make rockets go fast and to get escape velocity. The rocket is the startup. The jet fuel is the money. Escape velocity is profitability. When you look at this metaphor, what you can do with the jet fuel, if you're savvy is,

you can put it in tanks. And you got all these tanks on your property and you got a rocket ship factory over here. And like Uber did, they could say, we're going to do India. We're going to go to Japan. We're going to go to Australia. And we're going to put a little bit of fuel in each of these rockets. We're going to do Uber freight. We're going to do Uber vetoes. We're going to do Uber self-driving. We're going to do Uber pool. And they put a little bit of jet fuel into each of those rockets to see if they got escape velocity. Some did. Some didn't. Uber pool probably didn't work, but it was a good experiment. Uber in China and Russia, they wound up selling their assets to the people there, so they got the silver metal, not the gold. In other words, they used the jet fuel

aggressively, but intelligently. Now, there's a big difference between then taking your rocket and throw it into the fuel tank and then letting the fuel tank on fire. That's what we worked in. That's not how jet fuel works. So jet fuel can blow up. That's what Brandlis did, I think, too. Like, they were just grounding in jet fuel. You have to be very careful with the jet fuel. It's volatile, and it will blow up your startup.

It's fine to take a bunch of jet fuel, but put it in a stable tank away from the factory. That's why the factory is over here, and the jet fuel is over here. They put a little bit of distance, like a parking lot, or five parking lots, between those two things. So the jet fuel does.

doesn't blow up the factory. This is basic physics. You don't need to have a PhD to understand this. And unit economics is what all this comes to. If you look at the unit economics of, you know, DoorDash, Uber, and we work, they were using that fuel, right, to get more consumption. So how do you get people to consume more of a product? You make it super cheap. You make the ride so cheap that people can't help tell their friends about it. You make it so convenient to get a delivery that people are like, why would I go to the store if I can get this delivered to me for free? And then you make a habit out of it. And then you slowly increase the prices to reality. And if you can thread that needle, you'll see what happened to Uber in the last quarter. You'll see it happen with DoorDash and we saw

it happen with Amazon. That's the Silicon Valley Playbook. You can discount a price to get more people to use a product. And if you do that and you do it wisely, you can use that jet fuel to get escape velocity and build a huge world-changing business. And that's what Masa is in. And that's what Mosa is in the business of doing. So I love the fact that he's thinking about singles and doubles, but he did create the bubble in many ways. He wrote that $4 billion check to WeWork at a $47 billion valuation after a 20-minute meeting with Adam Newman. And so, you know, WeWork is now worth like $4 billion, like, you know, less than a 10th. And so Masa gave the following quote, when we were turning out big profits, I became somewhat delirious. And looking back at myself now,

I am quite embarrassed and remorseful. I think that is maybe overstating it a bit. I don't think he should lose his aggressive tendencies. I think he should continue to be aggressive. What you have to look at is with WeWork. I believe WeWork's previous round was 10 billion, and then he went all the way up to 47 billion. What he should have done is been more aggressive and said, hey, I'll give you a billion dollars at a $15 million valuation, right? But you have to love that he is honorable and that he takes ownership of this, and he's a good steward of capital at the end of the day. Because I do believe that even though he's upside down right now, he could make this actually turn into a big winning portfolio.

Even though he overpaid, there are in the documents the ability to get his money out first, right? So there's a couple of concepts here in venture capital. Even if you invest at these high valuations, your money comes out first, so you sort of have a backstop. Softbank did sell the rest of their Uber holdings between April and July at an average price of $41 and 47 cents per share for a gain of $1.5 billion. So it was still a very profitable. trade for them. They first invested in Uber in 2018 and was a larger, they were the largest shareholders at one point. But this would explain a lot of the downward pressure on Uber shares as well, is that they were clearing that big position. I had heard that through the grapevine,

along with Uber SoftBank also sold at stake in Open Door, Healthcare Company Guardian and Chinese real estate company, Bekoo. So this is interesting because I asked which SPAC people thought was the most promising for a J trade and they've been saying Open Door. So I will be looking at Open Door this week as a potential J-trade, and I'm looking for your feedback. We'll go to J-trading in a minute, and shout out to our friend Keith Roboy. In total, this resulted in a $5.6 billion gain for SoftBank. So they're selling, what I would argue is they're winners to get some cash in the bank. They should have done this earlier.

Obviously, that's in hindsight. Despite this, SoftBank's Vision Fund still reported a loss of $21.7 billion in the quarter ending July. And so that was SoftBanks fiscal Q1 technically. But, again, they're a holding company so these assets can rise and fall. And in fact, their shares in Alibaba, which I think we're at 300 or now at 90, those lost two thirds, right? They're trading out a third. And a large portion of SoftBank's value is the Alibaba stake.

According to MarketWatch, SoftBank will buy back up to 400 billion yen or about $3 billion of its own shares over the next year to try and boost its share price closer to the net asset value. Net asset value very simply is the value of all these investments they have. So SoftBank has the Vision Fund, which is their venture arm. That's the majority of their assets. that's what that value is when we look at the value of the company. Their net asset value is essentially those visioned funds. That's where all the holdings are, including Alibaba. Alibaba's lost 300.

Alibaba's lost two-thirds of its value. So as Alibaba goes, soft bank goes, and they're going to buy back a bunch of their own shares, 400 billion yen or about 3 billion of its own shares over the next year, to try and boost their share price closer to asset value. They also talked in this discussion about their loan ratio to their asset value, which they can control. And so they've basically have loans of something in the range of 15, 16% on the value of all these assets. When you look at SoftBank, it's essentially like a holding company of a bunch of public assets and private assets,

which is what I'm trying to do in my career is Trade Balthough. So I'm very fascinated by SoftBank just as a public entity that you can study and watch as they accumulate all these positions in companies. If you're an accredited investor, you need to know about special purpose vehicles. What's an SPV? It's an investment vehicle that allows 250 accredited investors to invest up to $10 million via one entry on a startup's cap table. So if you're an angel investor, you've got a bunch of rich friends, maybe your poker buddies, you can start your own syndicate powered through SPVs, just like me. At the syndicate.com, we are powered by our friends over at Shore. My syndicate has over 10,000 members and almost 5,000 of them have already done a deal and I've done over 250 deals.

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Investor, uh, Schill Monot, uh, of Better Tomorrow Ventures tweeted a thread on softbanks, Vision Fund today. We'll have Sheel on the program at some point. He said soft bank vision fund one is marked at 135 billion if you believe their marks plus 35% in five years. SPY is plus 70% during this time. Promise I don't believe they're marks. So that's an interesting issue here is do we believe the marks the private company values inside of soft banks holdings in relation to their net asset value? The public ones are easy. Just look at the stock price. How many shares they own? Boom, you know. With the private ones, somebody's got to put the value on it. SoftBank does this themselves.

How conservative are they? Who knows? But he did say they look at the public comps to price their private market investments. And so it's going to be very interesting to look over the years and see what happens with all of these public and private companies. One slide in the deck I thought was particularly interesting was this chart, which if you're watching us at YouTube.com slash this weekend. You can see the Vision Fund One investments and their soft banks gross gains and their multiple on invested capital, Moik, as we call it in the business.

Multiple on invested capital. Uber plus $1.5 billion, but only 1.2x Moik. They exited that position. In other words, the multiple on the invested capital. So they only made a modest return there. DoorDash, $7.1 billion gross gain, 11.5 Moik, right? So the multiple on invested capital, in a venture fund, you know, you're hoping for 3X kind of. So whatever cash came in, you got to 3X coming out of that. And they're still holding their DoorDash, apparently. Slack, 3X Moik, WeWork, not yet exited, DD, 9.3 billion dollar loss. WeWork is a $3 billion loss, not yet. Exited, grab, $329 million loss. Again, not yet exited. So they're holding on to some positions, we'll see. But I thought was most interesting was the approved

investment amount at vision funds. And, uh, they said this highlighted their investment discipline. Q1 in 2021, Q2, Q2, Q3, Q4, you see a plummet from 20 billion, 12 billion, 9.6 billion, 2.4 billion. And then last quarter, uh, 600 million. This actually might be a mistake. If you could actually deploy, uh, money, uh, you would want to deploy it now when the valuations are low. But unfortunately, they didn't take chips off the cable. They didn't, uh, apparently have a lot of cash here. They're dealing with these huge losses. Now, would be the perfect time to be buying into these companies, which is what I'm trying to do with J-trading and I'm trying to do privately. So sure, great to have more disciplined, but my lord, if you gave

Masayoshi-san, you know, $10 million to deploy now, he could buy a lot of great companies, I think, at very low prices. And this will be something we'll continue to watch. So if you haven't seen the video, I posted it over at inside.com. We'll put it in the show notes here. It's worth watching. I think especially if you're a capital allocator, watch the whole video. I really enjoyed watching it. Another hot market was D to C brands direct-to-consumer and friend of our pod, Helena Prince, Hambrick was on the pod talking about her company house. Remember they were the low alcohol direct-to-consumer drink based out of Sonoma County? They'd raised a seed round and with a bunch of famous folks.

And in a tweet thread today, like an hour before I went on air, Helena wrote that their lead investor declined to move forward with their Series A and they were in the process of closing. She said they're going through an ABC. This is an assignment for the benefit of creditors. If you've never heard that, I haven't heard this term since maybe after the dot-com era and a little bit after 2008.

Basically, it means you're going to shut down, you're going to sell all the assets, and then you're going to give the money to your creditors. So the creditors here, they could have some loans. They could have employees who are owed money. They could have equipment leases. They could have rent. They could have inventory.

that they've bought. So there's a list of creditors. The creditors all put in their claims. They sell everything. They take the money. It's essentially similar to a bankruptcy. And these DDC brands have been hard. It does not surprise me. I think you'll see a lot of these ABCs. One of the things that happens with these ABCs is that there is an opportunity if you're super brave to buy the brand. So if somebody really love the house brand, you might be able to come in and they raised a $4.5 million dollar seed round. So maybe there's $4.5 million invested in this company plus all the work that people did in it. Okay, let's say you look at the house brand and you're like the logo, the goodwill of the brand. What is that worth? Well, and maybe the customer list. If there's 10,000 people in the

customer list and you put a value of $10 on each of them or $100,000, that could be worth, you know, $100,000 or $1 million, but let's just say $25 for each of the people on the customer list. I'm making a number up. There's $10,000 of them. Okay. $200. $50,000 in value in that list. And let's say if you were to build the brand or all the marketing that's been done and if you were to build it over again and maybe there's some inventory. So maybe there's $100,000 in inventory somewhere that you could buy for $25,000. Maybe you could buy the list instead of for $250K for $25,000 and maybe the logo and the website and the domain name for $50,000. You might be able to buy all these assets for $100,000 and then try to restart it. You'd have a clean cap table.

And so sometimes what you'll see is somebody who is in love with the brand has an affinity for it, well then just take $100 grand and buy the asset. I almost did this with Mouth.com. We were investors in Mouth.com and somebody wound up buying it. I don't remember what it eventually sold for, but a couple of hundred grand. And we had a couple of hundred grand into the company. And I really loved the domain name and I really love the branding. But I didn't want to run the business.

I didn't have anybody to run the business. So some other company bought the Mouth.com assets when they went out. And so you'll see a lot of this in the dot com era. we saw a lot of it. After 2008, we saw some of it. And I predict you'll see a lot of this. And I actually tried to buy the Cosmo brand, Cosmo.com, which was like GoPuff, 15-minute delivery service in New York City. And JP Morgan wouldn't sell it to me. I also tried to buy the Path.com brand. I thought that was a cool, like, social network brand. And I was going to try to buy it and get Dave Moore into give me this blessing to maybe pursue it as like a private social network. But the company that had bought it, I think it was a creating company, they weren't interested in selling it to me. So sometimes these brands just die. And it's really sad. And we'll see a lot of this, I believe. You know, I don't know about blaming the Series A investor who didn't come through. It's a dynamic market.

If the company was really strong, they might have had five offers. The challenges, I think, D to C requires a lot of patience. And the return profile is hard. And so what's happening here, and this is no dig to the team at House, is if you're a venture capitalist, you're looking at your 50 investments of active companies. You might have two funds. You got invested in 100 companies. you've got 50 left. You're going to look at those 50 and you're going to say three buckets.

The winners, the companies that are the losers are just not going to make it. They're losing a ton of money. And then everybody in between. It's very easy to say, okay, we have some dry powder here. We've got some capital left. Let's put all of that money into the winners. The winners will then increase our funds winnings in a down market. And those fund managers are panicking right now saying we've got to put every dollar of dry powder we have into whatever our winning companies are so that the fund, I was talking about Moik before the multiple invested capital, so the moik goes up. So let's say your fund is currently 2x Moik. You want to get to three and you got some dry powder.

Are you going to put it into the company that doesn't have product market fit, has some product market fit, or has strong product market fit? It's as easy as that. If there's a company with strong market fit, you have to put every dollar into the ones with strong. You have to be cutthroat about it at a time like this. Because you're not at the beginning of your life cycle. You're in a down market.

Just like Masayoshi. is being cutthroat and he's blaming himself. That's actually happening as a microcosip inside of venture funds if they're smart. I have to deal with this. Masayoshi has to deal with it and everybody in between. If you're a founder, you need to have an honest discussion with yourself. Which bucket am I in? Am I strong product market fit?

I'm going to be okay. As long as I don't run out of capital and I keep myself cashed up. Moderate, medium product market fit, okay. I'm going to have to make cuts. I'm going to have to really focus on that product market fit and really focus on getting some cash in the door. so I can thread the needle here. So if there is a little bit of left over capital,

I might be able to convince people I'm in that bucket or I'm moving into that bucket. But if you're in this bucket way down here, it's over. There's no other way for me to tell you. It's over. You'll have conversations with E.C. They might take the call,

but they're not going to have the ability to really give you the two years of capital you need to get there in this market. And that's the reality you're going to have to face is you might have to go into what we call in the business, cockroach mode. What's cockroach mode? Everybody's laid off. We are going to have two people who are working half time to keep the brand alive and fulfill orders until we get to the

other side of this. And ABC, like an assignment for the benefit of creditors is the extreme version of that. You might have a month of runway. And what you can do in these situations I've seen done is somebody can come in and say, I will give a loan to the company of $250,000. But I am senior to everybody. And I get, if the company doesn't raise money, that 250K is going to convert into a million dollars paid back to me and 20% of the company. And if it doesn't happen and we do not raise the million dollars, I own the company, essentially. I own all the assets. And so those kind of really cut-throw deals are what I witnessed.

I really sadly witnessed a lot of my friends go through it. And essentially then founders quit. And then all of the companies that didn't have product and market fit get flushed out of the ecosystem. And what happens when all of them get flushed out of the ecosystem? Well, when they all get flushed out of the ecosystem, all that talent then goes to what's left. What's left? Companies with partial product market fit, they're triangulating, they're getting close, and strong companies, which then makes those companies stronger. So let that sink in. That's the cycle we're going through. And the way out of the cycle

is for the talent at companies without product market fit. And I'm not saying house is one of them. I'm not jumping. I don't want to beat up on house here. But any company that's going to go out, because we don't know the details of that. But the companies with the companies with out product market fit, all the talent there that are working really hard banging their head against the while trying to figure the stuff out, they go to the strong companies, which makes them profitable, which makes them profitable, which makes them go public, which makes the VCs, distribute money to their LPs, and thus the cycle starts again. Here, end of the lesson. I want to tell you about an awesome new community. It's an app. It's called Prometheus, and I'm

addicted to it. It's basically a hyper-focused version of Twitter, but it's focused on markets, venture capital, trading stocks, and it's filled with people who are fund managers and who are capital allocators. It's like my dream come true. And if you love Twist and you're into that stuff, then you've got to go sign up for Prometheus at Prometheusaltz.com right now. And here's a secret sauce. This is a bunch of fund managers and potential LPs on a platform talking to each other about raising capital, deploying capital. I started putting my J trades on there and I'm getting tremendous feedback from the community. If you're an accredited investor, Prometheus is going to help you find new fund managers to back, like me. And if you're a fund manager, like I am, you're also going

to be able to get access to potential new LPs, limited partners. If you're just a civilian, you're not an LP, you're not running a fund jet, but you're into tech. Well, you can just go there and you can learn. And it's really the only platform where you can talk to these verified professional fund managers. It's all signal. It's no noise. Prometheus solves the problems of visibility and access to alternative funds. And it has lower investment minimum, so more investors can get involved. Here's what I want you to do. You go to Prometheus Alts, P-R-O-M-E-T-H-E-U-S-A-L-T-S dot com,

or you just type in Prometheus and you find it in the app store, but you have to use the promo code T-W-I-S-T-T-T-T-T-T-E-R-R-R-R-R-R-R-R-R-R-R-R-R-R-R. All right, let's go to J-Trading. Just a quick update. I've made four trades to date. I have the domain named J-Trading.com. I'm not saying this is coming to CNBC or Bloomberg, but, I mean, wouldn't that be fun

if I had my own show about trading after Jim Kramer? And I just, I'm going to be honest with you. All my trades are up at Jtrading.com. You can see what price I got in. Remember, the goal here is for me to learn. I am a neophyte at trading public equities. I don't do that. I've never done it.

I've always thought I had no edge. Now I recognize I have no edge, but I want to learn. And so the vehicle for me learning will be Jtrading.com, I'm going to put a million or $2 million into this as my current intention. I could change that. I could put more.

I could put less. I could shut the whole thing down. Who knows? Now, why do I want to learn public market investing? Well, I find myself having to figure out when to distribute Robin Hood shares, Uber shares, all these companies of mine going public or companies that are pre-going public. Could go public, could never go public. They might SPAC.

Desktop metal went out on a SPAC. All of these companies, I as a private market investor, I'm now running into the public markets. and I'm learning about the public markets just by a function of that and having to do distributions, but I would like to be an expert at it. And I think that'll take me five or ten years to have some level of expertise, but I'd like to go faster. If I can become an expert in five years or less, I think that would be a good goal for me. So I set a pretty audacious goal, which is to learn in public and to try to find companies that could five X in 10 years.

In other words, beat the market, beat the index. Maybe not what I would expect to do in venture, but actually a five X fund in venture would be top like two percent or something or one percent. But I'd like to set an outrageous goal for myself. And right now, I've made four bets. And I'll just go through those bets just very quickly with you. I did stitch fix because I saw Bill Gurley, who's an insider buy a million shares or so. So I thought, insiders, this is but one theory. If insiders are buying the stock and they've been with it as a private company and he's been with as public company,

maybe that's a good signal. I'll place a small bet. I bought 5,000 shares and that's up. And then if you look at the percentage that's up, I think the percentage is 16.43. Say over 16%. This is not investment advice. This is not investment advice. I don't know what I'm doing.

I'm learning in public. If you follow these trades, which one of my friends told me they're going to do, I told them, please, if you're going to follow these trades, do it with money you can afford to lose because I don't know what I'm doing. The goal here is to learn. And I need you, the audience and anybody who's an expert on this stuff to tell me when I'm wrong.

So I'm going to talk about each trade. I'm going to give my thinking here on air. I'm going to talk about it on Twitter. I'm going to tell you my theories and then try to have you tell me it's a stupid theory. So is following insiders a stupid theory? Well, I did that, and I'm up 16% on this. So I'm feeling like maybe I need to do another J trade where I follow another insider into their shares.

I saw that the CEO of IHeart Radio, Bob Pittman had bought some shares in his own company. I don't know how much that is in relation to his net worth. I know Dara at Uber last year was buying a bunch of shares of Uber. So who knows, I think I'm going to find more insiders buying their own shares. Then number two, Disney. Why did I buy Disney?

I feel like these brands will last for the ages. And my theory on that was there is going to be a fundamentally new business in having a billion subscribers. Remember, Disney was not really in the subscription business, right? They were in the IP business. They would license their content to other people. And now a direct one-on-one relationship with customers. I said it on CNBC years ago. I know Disney has been not a great company in terms of returns.

but they're getting to hundreds of millions of paid subscribers. They own Star Wars. They own Pixar. They own the Disney characters. They own Marvel. They own parks. I think the subscription, they're just scratching the service.

The amount of easy wins that they have not accumulated is ridiculous. Inside of the Disney Plus app, there's no merch. Who is running Disney right now? Chapic. Listen to me. This is a message for Chapic. I don't know you.

but for the love of God, let Disney Plus sell merch. My kids are in it all day. After they watch Encanto, upsell them on Encanto stuff. When they're watching the Mandalorian, let them buy Baby Grogu. We bought three baby Grogu's,

three daughters, three baby grogues. I've spent more on baby grogues than I have on Disney Plus. Let it sink in, Chapic. Okay, listen to J-Cal. I'm J-trading your stock. I own, how many shares do I? 250 shares. I need a voice, Chapic.

Cut this and send it to them. In the Disney app, you have my credit card. There's a website called Amazon. It has something called One Click. You could have one click inside of Disney Plus. I'm looking at Marvel and it says, buy the comic book, buy the T-shirt. Why can't I buy Disney theme park tickets inside of Disney Plus?

don't you upsell me when I'm watching Star Wars on that crazy $5,000 Star Wars experience? Why is it? You feel like you don't like money? You don't want to grow the stock. We're trying to get 5x out of the stock. You're going to have to be more aggressive. I like how you're sacrificing your kids to advertising so you can see the Disney stock appreciating. I want my kids marketed to because this is going to pay for their college.

This is their trust funds if I give them trust funds. Okay. So Disney, I'm up 5%. Now, this is all in a month. But my theory again is Disney will have one billion subs. I also think Warner Brothers Discovery could also be joined that $500 million to a billion club. But we need to get Grogu purchases on the menu there. And then from Warner Brothers, it's very similar.

They've got to get everything dialed in. My Amazon share is up 6.5%. So I'm winning there. That's my biggest position in dollars. I have a thousand shares of Amazon. I'm getting my ass kicked by this Warner Brothers Discovery. I bought 3,000 shares. I'm down six dimes.

I'm down 12, almost 13%. As of this morning, I think I'm buying more. I think I'm buying more. The chaos leads me to want to buy more. Because HBO, Discovery, these brands, CNN, I think they own CNN too. And HBO, man, these things aren't going anywhere. DC Comics. And I think Zazlov is a killer. I think Zazlov will do whatever it takes to pay down the debt, to make that cash register saying to fire people, to reorganize. He's a murderer. Zazlov is an

assassin. He's a killer. I think Warner Bros. Dizzy had something like $50 billion in long-term debt. They have a lot of debt from this merger and they will slowly pay it down from profits. But it's good to have a little bit of debt and invest in the brands. That's my belief. But It's definitely something. And Michael Burry, it's his third largest holding, I believe. So that's the guy from the big short. And there I have is like, follow the winners. Michael Burry, I think, bought his shares at like $25.

So he's sunk. So J-Cal got in at 60. Michael Burry got in at 25. Now this thing's trading at 14, I think. I might just buy more. I might buy more. Because I think there'll be three or four winners in this space. Netflix, I might have missed my opportunity there.

But with Warner Brothers Discovery, man, I think that's going to become a juggernaut. I think that could be huge. That's a J-trading. Now, if you want to check it out, jatrading.com. My next theory is that SPACs are so derided and hated at this point. And people have so little faith in, you know, the collection of SPACs that came out. And I gave people a warning about them that like you're investing like a venture investor if you're investing in these companies.

And the YOLO craziness where everybody was like, I don't need to understand the revenue. I don't need to understand the growth. I don't need to understand product market fit. That all went out the door. And that to me, and nobody is looking in this pile. There's a big pile of SPACs. Somewhere in there, I believe, is a 10 or a 20X. I want to find the 10 or 20X in the SPAC pile.

So here's what I want you to do. This is your homework for J-traders out there. I need you to look at the price to sales ratios. I need you to look at the earnings. I need you to look at growth. I need you to look at management. I need you to look at the product. We're looking for a management team.

That is hardcore. We're looking for, you know, like Amazon hardcore, like Tesla hardcore management team. Like, we're going to win Zazlov. You know, I'm looking for Sluutman level management. War time CEOs, I need assassins, killers, samurai. So number one, in the smack pile, I'm looking for three things. Number one, killer, killers running the company. Number two, a product that is transcendent that people love that they won't shut up about.

Okay? Product, product, product. Okay? And then we want to see growth. We want to see some sign of life here that that product market fit and that killer team is actually resulting in the cash register ringing. That's my three criteria. You're the J trading army. You're my J-traders.

I need you to get out there and then give me some ideas. I'm looking for ideas. Okay? I need your ideas. Is it open door? Is it Jobi? Is it desktop metal? There's something in the SPAC stack that's going to go 10x or 20X.

There must be, right? And nobody's looking there. So if nobody's looking there and everybody's buying Amazon and now they're buying Stitch Fix, because me and Bill Gurley are in it, we've got to go find the next name. We got to go find the next name. I need you to slide into my DMs or email Jason at calicanus.com, producers at this week at startups.com, and get me. the next big win. I think it may be open doors on that short list. Everybody keep, I know it's down

40% or so in the last six months, but people keep telling me to check out Open Door. Hmm. Hmm. And don't IPOF me. Don't talk to me about Chmots facts. Chimot's my guy. We're besties. But please, please, I am not responsible for Chmoth. Chmoth is not responsible for J-Cal. We're friends. Don't come to me and ask me what IPOF is. I don't know what IPOF is. Okay? And if you reply to me and say some conspiracy there about IPOF, I will snap block you on Twitter because I don't have time to be speculating and then somebody's going to think that I know something I don't. I'm not trading Chumot Spacks. I'm not trading IPO. I'm not trading. Please make your own investment decisions. It's not investment advice.

Jtrading.com. All right. Next up on the program is Alex Skrill. He is the CEO of Nutrisense, of which I'm an investor and they've been crushing it and we break down why the company has done so well and why continuous glucose monitoring could be the secret to weight loss and health and getting rid of the obesity problem in America. Why does your glucose spike? Well, I use this continuous monitoring device. I used NutriSense. I fell in love with it. I invested in the company. And this is a great interview. So stick with us. All right, Molly. Next on the program is an entrepreneur that we invested in. His name is Alex Skrill, and he's from Nutrisense.

This is a SaaS platform that I wanted to try because, you know, I was struggling with my weight, and I was trying to understand what was going in in my chemistry. And Nutrisense lets customers track their glucose levels. And it also combines it with a coach, which is exactly what I was looking for. A company was formed in 2019, and we actually had them at the first remote demo day, which was in December of 2020. We started that program Remote Demo Day for people who are listening, RemoteDemoday.com, just as a way to meet founders during the pandemic.

And then we wound up investing from our third fund and our syndicate invested a bit of money. And we've been delighted with the results since then. The company has over 8,000 paying customers. Back in Q1 of 2021, they did 484,000. And this year in Q1, they did 1.7 million plus. So four times revenue. And we've talked about this as you've become an investor, Molly. you're looking to see if your companies can, you know, double triple revenue.

And when you got a company that's doing something in that range or better in this case, that's really, really great. And the product works because it's not just giving your blood glucose level. They're also tracking sleep and diet and you can put in the food that you're eating. And then all of a sudden the coach was like, hey, what did you eat here? What was the spike? And it turned out for me, Molly, cereal was the killer. and the order in which I was eating food.

So then I switched to eating vegetables, then protein, and then maybe having any dessert, sugar, flour, carbs. Man, did that change the profile of my glucose spiking? And it really helped me with my weight loss. So welcome to the program, Alex. Hey. Alex, welcome. We're not just an investor.

We're customers too. Amazing. Yeah, I mean, it is always something mundane like cereal, right, in the mornings, where you're just like, oh, wow, like this corn flakes or whatever I've been eating is spiking my sugar like crazy. It was weird. I was doing it at night, actually. I would get like super hungry at night. And now, what I'll do is I'll just have either full fat ice cream or, and I'll just have a scoop or two, or I will have Greek yogurt. And then sometimes I'll sprinkle in some keto granola, got a piece of fruit or whatever. And man, you know, getting your blood sugar level under control is a key part of weight loss.

Is that what people are using Nutrisense mostly for? Are these quantified self people? Are these people who are overweight? Who's using Nutrisense? Who's the ideal customer? Who are these 8,000 people paying to monitor their glucose level and have a Yeah, yeah. I mean, when we went into this, you know, my expectation was it is going to be a lot of folks

who are quantified self, who are more data-driven performance optimizers. But what we realize is that those folks are fairly educated on their diet. They're fairly healthy and they're doing it out of curiosity, more than anything. And the people who are getting the most value out of the actual program were the regular folks, like us, you know, not professional athletes. They were the people who were struggling with weight loss, struggling with pre-diabetes in the family or type 2 diabetes in the family, and really trying to understand what it is they should eat

for the long term to stay healthy as long as possible, to be able to, you know, stay healthy into their 50s and 60s and never developed diabetes in the first place. Yeah. talk to us a little bit about the science, like this idea that glucose monitoring is such a key. I have a mom who's type 1 diabetic, and I do feel like I've been sort of saying for any really, really one of my closest friends. And there is this sort of like, wait a second, if we all ate like a diabetic, it seems like we could be healthier. So talk about the science of like how monitoring glucose levels does play into weight loss in health. Yeah. So I actually think monitoring in general

should play a much larger role in healthcare, right? Like if we think about how we do healthcare now, it's very much about reacting to acute things that happen. You go to a doctor, they say, oh, something's out of whack. You need to take medication. You need to have a procedure, but that's sick care, right? You just diagnosed like something serious and now we need to treat it, rather than following your data and your trends while you're healthy and understanding when your trends are becoming unhealthy in the first place. If you think about how we diagnose cars and planes and software, all of these things, you know, we're monitoring. every single aspect, every single component, and making sure everything's working correctly.

But with us, with humans, we're just kind of waiting for something to break until we, you know, and at that point, we try to treat it. And so glucose, you know, my journey started with monitoring my cholesterol, which is much harder to do because you need to do, you know, constant lipid testing. You need to understand. And it became so tedious that I actually got my own cholesterol testing machine at home. And it's kind of similar. You know, you kind of prick your finger, collect some blood. But you get the data much more frequently and you can actually correlate that data with what you're doing, right? Like I ate high fat or a keto and here's what happened. Or I switched to high carb and here's what happened. And so that consistent monitoring and having that data is what I

think is really beneficial here. Glucose in particular was interesting because of the technology that was available. Right? So when you look at the type 1 diabetes space, the CGM devices have become cheaper and more effective over the last 10 years. And CGM is continuous glucose monitoring. Sorry, not to interrupt.

Yeah, yeah, exactly. Yeah, CGMs are the continuous glucose monitors. I mean, they've become fairly tiny, almost, they're still slightly invasive. There's a little filament that kind of goes under your skin. But it's basically a quarter-sized. It's like the little joby that you wear on your arm. Yeah, yeah, exactly.

just a little quarter-sized white puck that sits in your arm and it just sits there for 14 days just tracking your glucose levels the whole time and what's great about that is you know as you're tracking your meals you don't have to remember what you ate you just can you know make a note take a photo and then you can see the glucose spike associated with that food and a lot of people discover exactly what jason discovered which is like hey this cereal i've been eating all my life every single morning is causing a huge glucose spike uh probably not healthy in the long run, but you can't really tell until you're much older and these, you know, these health problems start to actually develop and show themselves.

Sorry, just to go back to like super basics, why is a big glucose spike bad? Yeah, so it's kind of like redlining your car at every stoplight, right? Like, you're really putting a lot of stress on the engine. In this case, your pancreas has to work hard to lower those glucose levels, especially if you're not using it. Like if you're a marathon runner, you know, you eat a pizza. before your marathon, you'll be fine because your body is, I mean, again, it is stress, but your body is using that energy for something.

If you're just kind of dumping sugar into your body, making your, you know, pancreas work, but your muscles don't really need this energy, then it ends up going somewhere, right? So either you gain fat or over and over again, you know, your pancreas having to work hard leads to pre-diabetes, potentially type 2 diabetes, if you keep doing it over and over. Gotcha. One of the nice things I learned as well, Molly, was just going for a walk for 15 minutes. Man, did that have an impact on lowering my glucose levels? The spikes would just become maybe half as much, a third as much, two thirds as much,

depending. And so a lot of times if I felt like I ate too much, I'm like, ah, why did I do that? I made a bad decision. And I'm like, you know what? I can kind of correct this decision if I just go for a walk. And the little puck that you put on was kind of like a round. round oversized, you know, band-aid. And the filament is a needle, but it is the thinnest needle you could possibly imagine.

Like, you can't barely see it when you're looking at the puck. And you use this little button to snap it on. You push it on. And you don't feel it. So that was the thing I had a, I was like, did I do this right? And then it was like, oh, yeah, I did. Because it's literally such a tiny, I think maybe getting bitten by a mosquito you would feel more. So I mean, for people who are scared of it, it's not very scary. Is that ever going to

work without having like a needle like that? Like, is my Apple watch ever going to track my macidos or Fitbit or something? Or my contact lens. I want a contact lens someday. Contact lens would be cool. The needle is actually used only to apply the filament. So the filament is flexible. It's like a little flexible thing. That's why you don't feel it under your skin. But totally. I mean, there are there are companies working, there's a company out there called Biolink working on a microneedle version of this, which basically scratches your skin and gets that fluid to come out. And basically measuring those same, measuring those glucose levels in the fluid, but, you know, not having to put something under your skin. And, and of course, optical is somethings people

have been mentioning for a very, very long time. You know, every year, it's kind of coming next year. but essentially the issue there is accuracy, right? Like how accurate can they get this to be? And you don't want it to be inaccurate just in case people misuse it. For example, if a type 1 diabetic uses it to inject insulin and the device is not accurate, they could essentially hurt themselves, right? And that's why the accuracy is so important here. We are not working with type 1 diabetics.

So, you know, if somebody is using insulin, they do need physician oversight. we typically work with folks who are, you know, fairly healthy and want to monitor their health. Some of them are maybe pre-diabetic or kind of getting close to type 2 diabetes. Tell us about the dietitians in the role they play. I know you have 50 of them now. I'm assuming they're working from home. I had very nice interactions and surprising ones where they, I don't know exactly how it works, but maybe they see on some intranet somewhere all the spikes that occurred in real time.

And this is what I'm imagining. and they just ask you what happened or they look at your food. Obviously, this is all with permission. It's part of the service. But do most people use the dietitians and what impact does a dietitian being in a chat room with you monitoring this due for you?

Yeah, absolutely. So when you sign up, there's actually a health questionnaire and a goals questionnaire. So we're asking you what it is that you want to achieve with this program. So people come in and they say, hey, I want to, I'm predisposed to diabetes in my family, and I want to prevent pre-diabetes.

or I want to lose some weight. And we actually assign a dietitian who happens to be an expert in the thing that you're trying to achieve. So whether that's weight loss, where there's a lot more accountability and the dietitian really just working with you and setting goals for you. And there's some folks who need more education than others. So there's a lot of education around glucose and how to use glucose measurement day-to-day to understand what you shouldn't eat.

So dietitian is assigned to. to every single person who signs up. It's basically free for a month for everyone who signs up. And then if you want to do it continuously, there's a small fee on top of our monthly subscription fee, where you can work with the digestion, you know, hands-on 24-7. You're basically chatting with them through the in-app chat.

So it's not like a video call or an audio call. You're basically, you know, you're able to ask them questions. And then they reach out proactively as well when they see something like a big glucose spike or a big change in your data. Let's talk about pricing because it's not inexpensive. It's $245 a month base, right? How long do people typically sign up for and then how much more is the dietitian? Yeah, so you can think of it as kind of like a gym membership.

We have a cheaper $200 a month version if you sign up for a longer period of time. And $250 if you sign up for the basic three months period. And the dietitian is an extra $50 in top of that. So can you imagine a scenario where like, I know that our medical system and insurance is not super focused on prevention and wellness, but can you imagine a future where somebody could have this prescribed and have it be part of their insurance package? Yeah, absolutely. I mean, with so many self-insured employers out there, right, they're trying to optimize for costs. And if you come to them and say, hey, a hundred of your employees. employees are using NutriSense and they love it and they've lost this much weight and they've

improved their blood sugar. I don't see why somebody wouldn't be interested in doing it for their company. And once self-insured employers are on board, it becomes easier to talk to larger health groups as well. Yeah. I can see that being an awesome benefit, Jason. Well, I mean, it is definitely, thanks. Thanks. Thanks. Just putting them on blast. Well, it is, you know, I do think we've been talking about this. We had the land beyond in talking about their sort of, you know, affordable, quote unquote, you know, concierge doctor at 3,000 a year. This is a similar price product.

You know, these things are not yet cheap, but what I've learned with technology is Uber Black quickly becomes UberX, becomes Lyftline, UberPool, you know, or jump mobility, lime scooters, whatever. You know, innovation just keeps happening. And I think we do need to get to a place where. we have an honest discussion about what are we spending on health care, especially for young people or younger people before the plane or the car breaks down. This is like not having a check engine light or only having a check engine light, but not having what pilots see. Pilots know the temperature,

the speed, the altitude, the oil pressure, how much fuel is in. They really have a lot more detail on what's going on with the car. And that does become a discussion with the maintenance crew, right? and they can see the history of things. And I think this whole IoT movement, Internet of Things, for people who weren't here for it, is going to have like this sort of second or third wave where we're going to just have more senses around. I just got a sensor for CO2 monitoring as an example.

And I've been carrying it around my house with me when I work out. And I was like, wow, the CO2 levels in the house are amazing. The HVAC is working well. I have also some sensors for California fires, Molly, just to make sure everything's nice and clean. And then I was working out and I brought the sense with me. And all of a sudden, for the first time the carbon monoxide went off. And I was like, what's going on here?

It's a problem in the gym. It's like, I'm the problem in the gym. I am running. You're huffing and puffing. I'm huffing and puffing. And then I opened the doors and put on the air purifier just to get some air circulation out. And it just boom, dropped immediately. And I was like, wow, you know, this is why I might be feeling a little dizzy on the treadmill.

Because I'm not getting enough oxygen or the carbon monoxide level is triple what it was. previous to the doors being open and the air filter being on. And, you know, this is just but one example. I think temperature sleep with eight sleep. We're investors in that company. I think we're going to start to see these items. And Alex, I don't know if you agree, become part of a collection where people will drive their own health.

And I think that to me, with, you know, the calm investment as well is what I'm interested in is people taking control of their own health outcomes. people picking their foods wisely, picking their exercise wisely, and just, you know, making an investment in time. Because it really isn't money. It doesn't seem in all cases. You could use this product for the three months, right, subscription and at least get some basic understanding. And it wouldn't be that much compared to what you would pay if you got sick. And if you all of a sudden were a diabetic and you had to pay for your insulin for God's sake, you know, I mean, the amount that people have to pay, like a type one can't help it, right? Their

pancreas doesn't operate. Yep. But if you can prevent type two. Yeah, also might be one visit, right, Molly? Right, it might be one visit. Exactly. To a doctor. A specialist.

And it's so hard now to like go to the doctor. You can't be assured of good care. And so this idea of prevention and wellness and like you're saying, this independent control feels so much more valuable. It saves you in all kinds of ways. Agency, right? I mean, just having an agency over your own life and not relying on the government or the health care system or the education. or the education system. It's great that we work on those.

But I just think some radical agency will actually change it because if your doctor, think about how your Alex, your relationship with your doctor and your healthcare providers change when you are coming in with your glucose levels

with your sleep patterns, with your weight and how it's changed. When I started doing that, the entire relationship changed. The doctor was like, well, you're on top of this. And I'm like, okay, so what's your advice? It's like, keep doing what you're doing.

And I'm like, really? Like, why do I have a primary care doctor anymore? Like, I literally did not invest all that much in terms of time or money to have the doctor say, yeah, just you're like the least of my problems. Keep doing what you're doing. I'm like, what else can I do? He said, not much. It really has to do with what doctors are trained to do, right? They're trained to, they're trained to diagnose and treat rather than educate and help you monitor and help you understand.

So if you think about it as education, right? Like instead of, but we used to have tutors, right? People used to be tutored one and one. And if you have that sort of relationship with a doctor or with an expert, your outcomes are way better than if you're sitting in a, you know, classroom for 500 people and just kind of consuming the same generic information because everything is personalized. It's about your data.

It's about how you're behaving. Yeah. And it's not just, you know, something that kind of applies to everyone because we all learn differently and we all respond to foods differently. And we all deal with different health issues, right? So I 100% agree. I think the IOT movement, you know, look at what we've done with heart rate recently. We started with just workout heart rate.

Now it's used for sleep detection right in your aura ring with, I think your eight sleep also measures heart rate, right? And sleep. Everything. Yeah, and sleep. It is literally the quantified self movement. and just, you know, let's call it health care agency or your own having agency of your own health really is what this is about and getting educated yourself. And it's really very simple. I think mental health falls into this as well. We're very quick. I don't mean to go all Tom Cruise here

of, you know, hey, this kid's got a problem. This adults has got a problem. Hey, here's a lot of, here's the menu of all the things you can do your brain and we can just start flipping chemistry switches here. I am not. Which, by the way, we know almost nothing about. So yeah, let's definitely get in there and just start. Exactly. I mean, you went there, Molly. I don't want to. Molly, don't start jumping on your couch here.

We don't want to go full Tom Cruise, but we've done the research. I took all the Tom Cruise drugs. I'm ready to jump on the couch. Don't be glib, Matt Lauer. I don't know if you guys remember that. We started yelling at Matt Lauer for being so glib and that Matt Lauer didn't even know what SRIs or serotonin was. It literally is Tom Cruise is a hero in some ways for his confrontation with Matt Lauer on that.

Because he was 100% on the right. He's like, you're reporting on this. Kids are being given these drugs. And everybody's laughing at Tom Cruise. He's like, but you're the person who's on Good Morning America broadcasting to five or ten million people and you don't even know the research. And I think we all have to get this research. If you look, Tom Cruise's was advocating for diet, exercise, sleep. Yeah.

And maybe like going out with your friends and having great relationships. If you talk to any therapist and, you know, anybody who's in mental health, They will tell you, how are you sleeping? What are you eating? Are you exercising? And tell me about the relationships. Do you have positive relationships with people at work and friends? Like, that's where they start.

And if you actually tackle those four things, you too will make a movie as great as Top Gun Maverick at the age of 60 and you don't age. You will not age. It's either that or Scientology. And I guess I would prefer to believe in sleep and diet, although I'm starting to wonder. The Scientology is basically a collection of self-help. No, it's a collection of, I know people in Scientology, a lot of my close friends. No, it is. And listen, I'm an atheist.

But it is a collection of self-health tools that a mad scientist named Elron Hubbard, who was a science fiction author, collected. So he kind of did what I'm doing right now, and I'd like to announce that Caliconology will be launching. And I'm 60. So Alex, you want in on this? It was only a matter of time. No, like a study came out, not to belabor this, but a study came out last week that was like, hey, you know this whole idea that serotonin levels are what caused depression in your brain? Yeah. That's not true.

There were huge doubts about that science when it was reported. But that is what led to all this, the SSRI treatments. And it appears to be inaccurate, a myth, which is why SSRIs work for like, you know, 2% of the population because they're effectively a placebo. but it does like increasingly right it's like the more you look into anything the more you discover that it's like inflammation which is diet and sleep yep full stop and exercise like it's just it shouldn't be that simple but it is yes Alex tell us you know have you stopped taking all of the uppers and downers that it requires to take to be a entrepreneur in this environment newotropic are you doing i'm limiting my coffee intake now to like just a weekend

Honestly, it just It's just, it. No, no, come on. Come on. No, stop with the caffeine. That's great. I'm going to selectively. I'm going to, I'm going to pick the, um, I'll go for your coffee.

No, actually, I love coffee. Just like, whenever I start drinking coffee, my tolerance builds up so quickly. I just go from one cup a day to like four cups a day in like a week. Oh, good. And. Okay. Yeah. So I try to keep.

Have you tried the Terra Cafe also a launch investment in syndicate investment? Actually, I've been looking at it. I actually really like it. What is the TK. When is the TK2 coming out? That's what I'm waiting for. I can't say, but I will say I have seen it and it's hot. Here's what I would do.

I'd buy the one that's out right now. It's great. TK2, I don't want to steal any thunder. It will be great too, but, you know, it might be more expensive. I don't know. But I would just buy the TK1. Enjoy it. When the TK2 comes out, whenever that is, you gift the TK1 to somebody.

It's a nice gift to give somebody. That's my plan. You know, just move it to your ski house, the old one, you know, whatever. Your beach house, whichever. I mean, I don't know if you need it at your beach. Molly, did you move it to your beach house? Because I don't know if you do ice coffee there. I put mine in the private plane.

On the private plane. Perfect. I should have known that. I actually gave the Tara Cafe to Chamath as a thank you gift because he did a favorite. It's a great gift, actually, by the way. All right, listen. Alex, thank you for letting us invest in your company.

It was great to get in early. Continued success. It's fantastic to see you performing so well as an entrepreneur and staying focused. what has been, if you were to give advice to the entrepreneurs listening, subscription businesses and product market fit, what do you think the secret to running an organization as a founder is that can hit this vaulted goal of tripling revenue year over year? How did you do it?

And what's advice do you have here as we wrap up? Yeah. I mean, I think I get this advice more to technical co-founders because one thing that they forget is to actually find, you know, find out who their customers are early and learn how to sell to them. and learn how to market to them. I mean, it depends on whether you're B2B or whether you're BTC,

but like start selling your product as early as possible, start getting interest as early as possible. Because a lot of people build for too long before they ship, right? And that's, it's sort of a cliche, like they say ship often, but a lot of people still, you know, we're all tight A. We all want this thing to be perfect before we actually ship it and then we, you know, give it to the rest of the world. But having a co-founder who was able to sell while I was,

focused on building division of labor. Division of labor. That's right. And a bias towards action. There you go. Bias towards action. Sempify. This is a U.S. Marine Corps. And then eventually taken on by Amazon in our

industry. A bias towards action is critical as a founder and product velocity matters. And as Reid Hoffman says, if you are not embarrassed by your V1, you ship too late. Great true, Reid. back on the program. I haven't seen me in a while. All right, listen, Alex, continued success. And yeah, keep us updated on your progress. We'll see you in a year. Congrats. Can't wait to try it. Thanks. Pleasure to be here.

I guess I'm fine. Take care. Okay, everybody, make sure you tune in tomorrow. I got my boys from Acquired. They're back. The Acquired Boys are back. And we're going to go deep into this VC downturn, what it means for founders, what it means for capital allocators, angel investor seed funds, and maybe some more SoftBank Vision Fund reflections. And we got some amazing notes on Amazon, AMZN, which I think is my second, that's my second pony there,

doing pretty well for me. And we'll go in to talk a little more about J-trading with the boy, see if they have some insights for me. They're always good. We'll take a couple questions from the Noty Gang. It's going to be an awesome show.