This Week in Startups - TWiST News: Underwater Drones, Robot Swarms, and Klarna's Going Public | E2043

Starting point is 00:00:00 We don't focus too much on coming home after a long mission, to be honest. You know, it's anywhere from a few hours to potentially a day plus for the small vehicle. And then we're going to be announcing some bigger vehicles where you'll see much extended ranges. Also, the vehicles are fully modular. So you can kind of break it down and put it in a backpack right now. Oh. And the kind of benefit of that is you can add like an extended battery pack and stuff like that to get an additional range. Wow.

Starting point is 00:00:25 So the seals could have these in a backpack. They land in some gnarly area. They send this thing out. It gets them a bunch of data. Then it helps enhance the mission or they could make something go boom. Yeah. Yeah, it's a possible use case. Or you could be a researcher hiking to some remote lake and throw it in there.

Starting point is 00:00:41 Find Lochness Monster. Yeah, exactly. Find some new species. Save Taiwan. Find the Lochness Monster. I mean, either of these would be extraordinary accomplishments. This weekend startups is brought to you by Squarespace. Turn your idea into a new website.

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Starting point is 00:01:33 Welcome back to this week in startups. With me again, Alex Wilhelm, I'm Jason Kalakannis. We're here to talk about technology. And it seems like American dynamism and even Chinese dynamism is alive and well. People are building a lot of physical things in the real world. And we're going to get into it today with a lot of robots and a lot of vehicles. It's coming fast and furious, huh, Alex? It's coming fast and furious, and I'm just very excited as a consumer because I feel like, you know, phones have become so relatively static over the years that I just want something new, exciting, a form factor that blows my mind, something that kind of brings me that sense of joy that I had when I got my first smartphone back in like the original iPhone days.

Starting point is 00:02:15 So I'm optimistic and that feels nice. All right. Well, before we get to surgery robots and robots running through the woods in a completely new format, that I had never seen before from China, these robots chasing you through the woods in a dystopian hellscape. Let's talk about, let's interview our first guest here

Starting point is 00:02:37 and talk about what he's building. Yeah, so today on the show, we have Nelson Mills, one of the co-founders of a company called Voughton Systems that's spelled VATN, if you want to look it up. They are a company based here in Rhode Island, very proud to say, and they are working on underwater drugs,

Starting point is 00:02:55 own technology that will have both defense and commercial applications and the company was just in the news because it raised a $13 million seed round led Jason by D-Y-N-E or Dynne Ventures. Nelson, hey. Nelson, how are you? Great to me, you. Thanks for having me on.

Starting point is 00:03:12 Maybe we could pull up a video and some images of what you're building and you can just walk us through it here for the audience. Show us what you've built and walk us through. Yeah, so right here you're seeing our engineers out. testing and working through the vehicles themselves. So we are seeing here as a man-portable vehicle being carried by our CTO right there,

Starting point is 00:03:33 and now it's running through the water. But our first product, we call the Torsk on the commercial side or the Skalmure S6 on the defense side. And it's a six-inch diameter, really lightweight and a fraction of the cost of existing options with the ultimate goal of really building them at scale, which we're going to start next year. and making it easy for one person to deploy a whole bunch of these and really control a multitude.

Starting point is 00:04:01 So these Torsks look like torpedoes, but these do not have explosives in them. They look like a little missile, but I noticed the person putting them into the ocean from a dingy. They look like they were in a zodiac. Needed only pick up two handles and drop it in the water, so they are apparently pretty lightweight. They look like they're about six, I don't know, seven feet long.

Starting point is 00:04:23 Yeah, and tell us about what the mission is for the T-O-R-S-K. Yeah, so T-R-S-K is our commercial variant, mainly carrying sensors. So it could be anything from side-scan sonar to passive acoustic to other forms of environmental monitoring, even like cameras go, you know, collect data on the seafloor, whether that's for, you know, say, offshore wind, oil and gas, you know, Noah, go clobacco. environmental data, researchers. But I'll be honest, 95% of our focus right now is defense, and we're really working on the Skelemere S6, which can also carry a variety of payload.

Starting point is 00:05:05 Some of them are similar, you know, sensors, but we, at the end of the day, built a truck, and it's up to the customer to decide what payloads they want to implement and deploy on the vehicle, right? Are there other defensive applications apart from just putting an explosive at the tip of it, as you would in, perhaps a traditional torpedo, Nelson? Are there, I don't know, can it like launch stuff on its own out of the water, like smaller drones? I'm curious what you can put into it. Yeah, I mean, it's really the bounds of your imagination.

Starting point is 00:05:31 So we've done sensors to just go like look for objects, clear beaches. We've put on various electronic warfare modules. So make it look like a decoy, whether it's an underwater decoy or to pop up on the surface and suddenly it looks like there's a ship there. There's a whole bunch of use cases where it still makes sense as a, you know, an intradable system, right? that the military can send it out, it can go do a non-kinetic effect or collect some data, and then they don't have to worry about risking people's lives to get it back. And that's really kind of the big motivating factor here is that our underwater systems are way too expensive.

Starting point is 00:06:10 Break that down for me, because I'm presuming that this is usually a defense contracting boondoggle. So what does the military variant of a Torsk cost? And how does that compare to an existing system that you might buy from an existing defense Prime. Yeah, you know, our price point is around 75K. And, you know, for a defense prime, you'd be looking at $500,000 plus dollars for an equivalent system. Yeah. So are they just stealing our money? I think there's just like a ton of inefficiency built into the system and their approach to it. And, you know, the kind of whole cost plus contracting methodology, right? And this is really what,

Starting point is 00:06:46 you know, defense tech is about. It's like upending kind of that methodology. And then also like all those underwater systems, like the underwater drone market is 10, 15 years behind other drone markets. And they're all come out of research. It's like a researcher built one of these, and now they're trying to build a few a month, but it's never been built for scale production. They haven't done the things necessary in order to get the cost down. And from day one, we're going to build thousands of these, and we're going to vertically integrate the key components that lets us significantly reduce our bomb in addition to just like the sheer quantity. Jason, this company has some of the fastest product velocity I've ever seen.

Starting point is 00:07:26 This is one of your favorite things. So a year ago, they were just deploying their first AUV and now they've already moved from prototypes, fully operational systems, which I thought was incredibly impressive speed. Yeah, and what a great price relative to what military contractors spend on similar devices. And this speaks to how conflicts are changing. You have people using drones in the field, quadcopters. We've seen that in Ukraine. We're hearing about it in a possible conflict with China over Taiwan. So not having to recover the tusk is a main feature of this. It can just be used to collect information. If the enemy captures it, if it sinks to the bottom of the ocean, it's not as big of a deal as a, I don't know, $100 million plane or $25 million boat. or whatever it happens to be, yeah? $4 billion sub.

Starting point is 00:08:20 Or a billion dollar sub, right? Yeah. And so these things could collect what a sub could collect. How deep can it go? What's the range like? How is it powered? Yeah, and I'll be up front. It's not a direct equivalent for a sub,

Starting point is 00:08:33 but what we're doing is focusing the top 300 meters of the water and really producing effects and collecting data on littoral and kind of the top part of the ocean environment. There's a lot of people who go deep, and that's another way we really save money and differentiate ourselves. Yeah, that's kind of the primary focus there. And there's a really, yeah, like a big opportunity. And if you control just underwater, you basically control the surface. And that's generally like our philosophy, giving the military the tools to spread kind of control, I guess control or power underwater.

Starting point is 00:09:11 And we really like, you know, we're building something like 100 drones a year, maybe underwater drones a year. the US, right? Like, in terms of actual military drones. Oh, yeah. Yeah, total. That's a pathetic number. That's like backyard numbers. But going back to the depth point, does it only go into 300 meters?

Starting point is 00:09:28 Does that allow you to go faster underwater? I'm not sure about the result of more water on top, pressure, and if that slows down travel and also increases in efficiency in terms of drag. It doesn't necessarily limit the speed you can go, but it is another kind of a differentiating features is that we go a lot faster than a traditional UV. We don't go as fast as a torpedo, but we live in that space between UVUV and torpedo and can really conduct a variety of missions. We're not limiting ourselves to just one. Your typical UV right now cruises at like three to five knots and some of our vehicles can approach 30. What is the UUV? Unmanned underwater vehicle.

Starting point is 00:10:08 Unmanned underwater vehicle. So that's the category UUV. You're making one that goes particularly fast. So this would go faster than a ship would be able to go or a submarine if it was on the surface or similar? It depends on the ship. And, you know, there's there's we have, you know, ships in the U.S. military that go really fast. And subs are are quite fast too. We're not necessarily trying to go after that. Think of like the kind of effect of the, you know, the PRC has 10,000 maritime militia vessels, right, that are just like basically armed fishing vessels. Like, what do we do about that? They're not fast.

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Starting point is 00:12:26 So I was just curious if you could educate us, the audience as well, just on the state of the tonnage and the number of vessels and the type of vessels that China is investing in, because obviously they've got a pretty large southern coastline there, and that area is the South China Sea, I guess, is a big debated area where we think the next major theater of war could occur. So maybe it's just broad strokes. What are we dealing with? Yeah, I'm not necessarily an expert on the CCP's Navy just to be up front. But, you know, the U.S. Navy has significantly more punage, but in sheer number of ships

Starting point is 00:13:04 and kind of spread in mass of ships, the CCB has been building rapidly. And, you know, I think one of the issues we have in the U.S. is like, if a conflict happens, we can't produce our ships, our core systems, fast enough, right? So what is the solution? And part of that, you know, the thing we can build fast enough or we'll be able to build fast quickly is drones of all sorts, surface, underwater, air, etc. But there's really no platform manufacture of underwater drones in the U.S. right now.

Starting point is 00:13:34 That's what we want to be and want to do, right? So where are you going to build them? Because I know you're based in Portsmouth, Rhode Island. And I'm going to say Rhode Island as many times as I can on this episode just because I'm proud. But I'm curious if we have enough space industrial capacity in our little state to actually support, you know, making thousands of these a year. So do you have to expand else we're in the U.S.?

Starting point is 00:13:52 Yeah, we can build thousands in Rhode Island and we're planning to. Like, we're already working on it. I think, you know, as you approach larger amounts, we probably will start to work with other states too, but, you know, Rhode Island's an awesome place to be. There's great infrastructure here for manufacturing, actually, and for defense. So, yeah, we're excited about it. To explain that, we built submarines in Rhode Island. So we have a lot of the, you know, boat contracting world set up here. People don't know that. Now they do. Yeah. I'm very excited about that. Yeah, exactly. And then my other question is about tonnage versus swarm. So you told Jason that the

Starting point is 00:14:28 U.S. Navy has more tonnage. I presume that's mostly held up in our aircraft carriers, which are enormous and nuclear powered and so forth. But just as a drone can take out a main battle tank, I presume that an underwater drone can, you know, undercut the power of a heavy traditional weapon system. So does the ability to build lots of these underwater drones obviate the concern that we have about American shipbuilding capacity compared to China? Because it seems like this is a better, cheaper, faster way and doesn't risk our sailors' lives. Yeah, I mean, it's part of the solution, right? I don't think we're getting rid of main warships. anytime soon and they have a seeming place in the battlefield, but our goal is that we can take

Starting point is 00:15:09 our warfighters farther away from the action with our vehicles. And we've seen how effective they can be in the Black Sea, right? Like, that's been, you know, kind of a battle lab of maritime drones. And they've been mostly using surface vessels, which are, you know, a little bit more prone to interception and they've still had great luck against these, you know, multi-hundred million dollar systems, you know, destroyers and etc. Could we say like a GoFundMe to buy stuff from Voughton systems that we can send them over to Zolensky? Because, you know, I'm in for 50 bucks. Yeah, I have to consult my lawyers on that one.

Starting point is 00:15:44 Yeah. So talk to us about raising money for defense tech because this seems to have been something 10 years ago. The entire technology industry was maybe, or the majority of the technology industry and venture capital industry wasn't going near this. And then they start Andrews success and some other hardware success. The SpaceX, obviously, being the tip of that spear. And now all of a sudden, venture capital is like, hey, there's something here. It's not outrageous to give $13 million to a crazy team in Rhode Island to think that they compete with government contractors. So maybe you can talk just a little bit about the climate around defense tech startups and your experience raising.

Starting point is 00:16:29 Yeah, no, I mean, there's no better time, I think, to raise in defense. And I don't think it's going away anytime soon might reduce or might be a little bit of a bubble. But I think the core of it is that defense is here to stay as a category in venture capital. But you're right. I would argue even like less than 10 years ago, I can remember. I mean, I was an investor before this and 21 even, yeah, like 21, I don't remember anyone talking about defense. Right. I think the Ukraine conflict and seeing the impact technology can have there is really what threw on the kind of afterburners or whatever on this segment.

Starting point is 00:17:04 I think Androl did pave the way, but they were the lone voice in this space for a long time. Other people might have been doing defense contracts, but it was kind of something you didn't talk about, right? It's like, oh, we're doing this, but we don't want to tell our investors or anyone else, right, or something like that. But yeah, that's completely the switch has flipped. And I think it's great. I mean, I think there's going to be a lot of companies and funds that that fail in the space, but that's venture capital, right? Like, there's going to be a lot of great success stories. There's going to be companies that fail through no fault of their own. There's going to be, you know, companies that fail through their fault and every other, every which way. Well, I mean, it is, I think if we're going to win the war, and I hate to, you know, wax poetic here about capitalism like I'm prone to do. But in an authoritarian, government, you know, a dictator can say, I'm going to just take these million people, put them in a slave camp, and tell them to build what I want them to build. And that seems like a really amazing

Starting point is 00:18:03 feature for their society to be able to use imminent domain and unlimited, unchecked power to just accomplish goals. And then, you know, you look at a democratic process, which is quite messy, as we've seen in the last week, or, I don't know, last decade. And so we can sit here and say like, oh my God, we're wasting time. We're wasting time. But freedom and capitalism, democracy plus capitalism, feels so messy and chaotic. As you just described, hey, a bunch of these companies are going to die because they're

Starting point is 00:18:35 incompetent, but also through no fault of there. But a bunch of the smartest and brightest people who are given the job of capital allocation, meeting with all these teams and saying, hey, which team do I want to back and why? And then those teams trying to convince those people, hey, here's our strategy, and here's what we've done. Here's why we're the best team to bet on. That basic, competitive, dare I say, selfish approach that you believe you actually have the best solution, and you believe you can bring the best team together. And you can beat the other competitors on the playing field. You know what?

Starting point is 00:19:14 That's very hard for a dictator to deal with, because you can put a gun to people's head and say build. but the motivation is going to be fear, as opposed to a motivation, which is opportunity and pride and competitiveness. And that's just absolutely, I know it's out of fashion to say this, but competition and excellence is pretty awesome. And I just want to applaud you for doing this.

Starting point is 00:19:38 You can probably do something easier as a venture capitalist and start a company, and you weren't investing before this. But I think that this could be, you know, what you're doing this entire movement. This could be the difference between democracy increasing and democracy decreasing in terms of the number of people who are living in a system where they're allowed to vote. And they're allowed to argue over their votes and did their votes count?

Starting point is 00:20:03 And how should their vote count? We are so narcissistic and entitled that we have no idea how great it is that we can sit here and pick a leader and we can sit here and debate our voting. It's just a beautiful thing. I don't know if there's a question in there. I just felt like I needed to get that off my chest. Yeah, I agree completely. I mean, part of the reason we beat the Soviet Union was because of the failure of their command economy, right, and our ability to innovate and grow and outspend.

Starting point is 00:20:35 It's the same thing here. Like, I always say that, like, defense technology is necessarily about winning a war, it's about preventing the next war, right? It goes back to like a fundamental Sun Z quote of like, don't conduct a war until you know you can win. As long as we're innovating and putting the best technology on the field and can show that we will be a really tough opponent and they don't know if they can win. Our adversaries don't know they can win. Then there won't be a war, right? At least I don't think there will be.

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Starting point is 00:22:42 which is self-driving for underwater drones, I believe. And then also we're talking a lot these days about swarming technologies, usually in the air, but also now in the water. And I presume that autonomy underwater is going to be clutched to actually having these drone swarms in the seas. Yeah, so Instinct is actually just our inertial navigation system. And 2026 is its release as an independent product, but it'll be in our, yeah, it'll be in our vehicles much sooner than that. It's already in our vehicles.

Starting point is 00:23:12 But we do our full stack of our own autonomy and our own swarming software, right? Really single agent and multi-agent autonomy. And underwater is a space where it's autonomy first, right? Like we have no way to control these vehicles. Like they're fully autonomous. Once they go underwater, you can't really communicate with them. You can send like stop or like a new command or something like that. But underwater comms are really limited.

Starting point is 00:23:38 So it's kind of cool. that tragedy with going to the Titanic, most of the time when you send something into the deep water and you go a thousand feet deep or more, you can't communicate, I guess, unless there's a tether, or there's some technology that you just send a text message underwater, explain to the audience. I mean, we obviously understand there's a density of water. It's hard to send signal over the air is pretty easy, but the density of water makes it near impossible. So what's actually occurring there when you try to communicate with one of these things and it's a thousand feet down? Yeah, so we use kind of off-the-shelf acoustic communication technology.

Starting point is 00:24:15 It's just scale the ACOMs for short. And with that, you can send, like you said, text messages. It's like kilobytes per second. And you're typically range-limited 1 to 8 kilometers. Now there's some really cool technology and startups in the space, and I think that's going to improve quickly. But at the same time, like, you run up to some barriers in physics, right? Like, there's really cool, like, light-based comms underwater, but, you know, you're talking

Starting point is 00:24:40 100 to 200 meters. You can stream video, but like, you can't take it very far. Just a diffraction of light and water. You run into the barriers of physics. Honestly, I think it's, like, good for us as a company because, you know, we can't pretend or we can't start with, like, oh, this is operated. Like, from day one, we have to be autonomous. And-

Starting point is 00:25:01 Yeah, you're going right to level five. There is no safety driver. there is no mission control specialist with a joystick who can take over for these things when they're at a certain depth. But I assume they can talk to each other easier than talking to the services on the surface on some mission.

Starting point is 00:25:20 So that is kind of interesting that they could create some sort of a mesh network, perhaps. If you had 20 of these things and each were at different heights, they could communicate with each other and then the final one could communicate in a faster way with the surface, yeah? Yeah, exactly.

Starting point is 00:25:34 you hit the nail on the head. You know, one can be on the surface and act as that relay or an unmanned surface vessel or even a manned surface vessel can act as that relay to underwater and communicate with a swarm or mesh, mesh of the vehicles. And the vehicles themselves can also act as a kind of underwater comms relay. That's really hard to jam. That's another kind of our use cases. Lots of interesting things you can do on that front. And, you know, we do use the ACOMs for the vehicles to coordinate among themselves too. And that's kind of what

Starting point is 00:26:04 How long of a mission can they last for? Because there was a cell drone company. I remember, I think Chimov maybe had invested in it. It had solar. It was a surface-based vehicle. They could go all around the planet. I'm sure you've seen it. And collect information.

Starting point is 00:26:18 With yours, I'm assuming there's some sort of battery pack in here. But how long is this thing going to be able to go for? And then if they complete their mission, can they go to the surface charge up with some solar and then come home eventually? How does it work? Yeah. We don't focus too much on,

Starting point is 00:26:33 coming home after a long mission, to be honest. But we, you know, it's anywhere from a few hours to potentially a day, a day plus for the small vehicle. And then we're going to be announcing some bigger vehicles where you'll see extended, very much extended ranges. Also, the vehicles are fully modular. So you can kind of break it down and put it in a backpack right now. Oh.

Starting point is 00:26:54 And the kind of benefit of that is you can add like an extended battery pack and stuff like that to get an additional range. Wow. So the seals could have these in a backpack. they land in some gnarly area, they send this thing out, it gets them a bunch of data, then they can,

Starting point is 00:27:09 it helps enhance the mission or they could make something go boom. Yeah, yeah, it's possible use case. Or you could be a researcher hiking to some remote lake and throw it in there and

Starting point is 00:27:17 find lockness monster. Yeah, exactly. Find some new species. All right, but save Taiwan, find the Lochness monster. Exactly.

Starting point is 00:27:26 I mean, either of these would be extraordinary accomplishments. Yeah, I want to do one more question, Nelson, before we let you go, because you just mentioned, size and I'm very curious because what you're currently building is cool because you can carry it around.

Starting point is 00:27:38 It looks like a torpedo. But how big will Gen 2 and Gen 3 be of what Vatten builds? Because I'm curious that this gets to like half sub size. Yeah, we're not we're not going crazy big. But more will be released next year. You guys can have me back. I tell you all about it next year. I'll have you back when you debut. Listen, continued success with this. It's super important. And I think just you know, as Americans, it's just a great feeling to know that there are teams who believe in protecting the country and protecting democracy. I know some people are, you know, at this, we're all for peace, but peace through strength is, I think, what this is going to take. And we all know full well, nukes, you know, are one level of deterrent. But man, if we get into

Starting point is 00:28:22 one of these serious conflicts and we have to, we need to have a different type of equipment for the same theater, but it's going to be a very different movie, isn't it? Yeah. Exactly. We've been living in Pox Americana since World War II, and we need to keep that going. Yeah. Yeah. Peace through strength. And we'll see you soon, Nelson. Thank you so much for coming on. Thank you for having me on. Yeah. Continuous success. Oh, and are you hiring right now? We are hiring a ton of people. What's the difficult position? Because, you know, we always do a good job of helping people find elite talent. Yeah. I mean, if you're an amazing inertial nav engineer, guidance navigation, control engineer, you know, come email me, you know, check out. Actually, there is somebody listening who knows somebody works in guidance and who would love, love to live in the Northeast, Rhode Island, incredible place.

Starting point is 00:29:11 Awesome. We have a great GMC team and looking to add some awesome folks to it. Awesome. I'll talk to you soon. Well done. Talk soon. All right. You want to build products that users love.

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Starting point is 00:30:04 it's going to increase retention, it's going to reduce churn, all of those good things are going to happen. See why top product teams at Notion and Figma, two of the classic breakout products of the last decade are already using Spriggs AI to unlock new opportunities at scale. Visit sprig.com slash twist to book a demo and get a $75 gift card. How nice. Sprig S-P-R-I-G dot com slash twist. I just love this new format we're doing where we get these entrepreneurs on real quick, talk about what they're doing and then get right to the news. This format of interview, then getting into the news, we get to be super efficient for those of you who listen three times a week, four times a week.

Starting point is 00:30:48 Yeah, it's funny, though, because it always forces me to learn a lot while we get these people on, prep them, go through the graphics, figure out the technology. And then I do all this work, Jason, to know good questions to ask, help explain to the audience, And then what I do is I go off script and I try to explain ocean physics in the middle of my question about drag and make a complete horse's ass of myself. No, you don't. You don't. I mean, one of the great things we can do here, I think, is, you know, get people information efficiently. And I think the American dynamism movement. And if you listen to this pod, you're just going to understand the trends because that's what we do for a living is just try to understand where the puck is going and skate to that place. What you're seeing here is hardware is hard. However, venture capitalists are starting to learn which hardware categories could build a sustainable business. Now, if you're in the consumer space and you build something that's a commodity, like a webcam,

Starting point is 00:31:43 it's going to be very hard for you to compete against what will eventually happen, which is the same factory in Chechenchen that makes your Nest camera is going to make literally a $29 version of what you're selling for $2.99, and they're going to take the bottom half of the market, and they don't care if they have a $5.5. percent margin and you're trying to operate with a 50 percent margin, 30 percent margin, etc. But VCs also know that platform companies that have customers with deep pockets and complex problems, you know, those are more sustainable. And so I brought up density. We had them on the show recently, Andrew, with a hockey puck called The Waffle that does people counting. But they're building an entire platform. When you build an entire platform and you solve a really important problem,

Starting point is 00:32:26 which is like understanding the density of space and how space is used, this is a lot at stake. your company will survive. But when they started that company density, Alex, they were at Phil's coffee in San Francisco, just counting the number of people coming in and out. And the potential application was knowing how busy it was. Which, by the way, Google does now by just tracking how many phones go into a location. You know, it's not spyware exactly, but it's not exactly not spyware. They know how busy a place is based on the number of Google Maps people who just entered it.

Starting point is 00:32:56 So your data is being put to good use. So, you know, I don't know if you've ever seen that. I have the little chart on... Yeah, how crowded is the place. That was an original vision of density, and it got solved by, you know, the Android operating system having Google Maps, ubiquitous. Putting all that aside, hardware is hard, but if you pick the right customer and you have the right VCs, they can help you manage it.

Starting point is 00:33:19 And that's what we're seeing here. Only $13 million to start a defense contractor. Oh, yeah. It's pretty amazing. But when you think about it, how many people do you need it? And that's the second trend I wanted to build up. You know, hardware's hard, but is one trend. Okay, we all know hardware's hard, but there's a caveat there when it's possible.

Starting point is 00:33:35 The second piece is commodification of sensor technology. You know, the cost of the batteries he's putting in there are really cheap because of electric vehicles and Tesla. Tesla's vehicles and the electric batteries, and there are very cheap because of iPhone batteries hitting scale. And iPhone batteries are very cheap because previous to those laptop batteries got back. better and better. So you can watch laptop batteries give way to electric vehicles, give way to iPhone, and now give way to these. He doesn't have to do anything in GPS, batteries, and you know, with 3D printing and a team, you can, and we have a company desktop metal where investors in that lets you do 3D printing of metals and all kinds of different

Starting point is 00:34:21 fabrication. All that technology is now getting to the point we're prototyping the stuff and even building commercially viable things can happen at much smaller scales with less investment. Yeah. And I think the margin point is super critical because your webcam example is great. There's very little margin left there. Desktop computer monitors. Dell has crushed that, very little margin. No point going after that. But when he told us that these same technologies cost $500,000 from a major defense contractor and they're going for 75, that's a hell of a lot of margin to go attack. And what did Jeff Bezos say about margins? Well, their opportunity to D's if you're attacking them.

Starting point is 00:34:57 So yes, your margin is my opportunity, was the quote. Yeah. Yeah, I'm really excited about this. But let's get the hardware theme going. Yeah, please. Jason, you have found a plethora of interesting bits of technology in the last couple of days. We have compiled them and we're going to start with my second favorite, which is LG's new stretchable screen. Now, if you're not familiar with stretchable screens, it turns out these have existed for a while, Jason, but they only have like 20% stretchability.

Starting point is 00:35:24 now LGs can do 50% stretching from 12 to 18 inches. I think this is super cool, but I wonder how expensive it is to make. But I think it's awesome. You know, the reason I shared this was because they're really starting to make progress on monitors and screens. And if you look at a foldable phone movement, that went from being like science fiction to, you know, every time I go to a meeting. Especially in the Middle East, by the way, people had these because there's, Android is loved in the Middle East, one. And number two, there is a status culture. These are incredibly high-end consumers who love to buy the latest gadget. They're incredibly tech savvy. They're very plugged in. And I noticed so many people had the, I think it's Samsung and then the pixel had the ones that open up, but then also have like a third screen on the front. Yeah. I looked at that and I demurred when I saw the price.

Starting point is 00:36:27 Like these were like two grand. Yeah. That's a lot to, you know, get like another screen that, you know, whatever. Anyway, putting that aside, I think the foldable stuff is kind of gimmicky. What it's getting close to being interesting. What I like about this is I believe this is going to open up wearables in a major way. So whenever they show these, the thing I think that's going to really be interesting is when you have a jacket or a bangle, you know, like, you know what a bangle is?

Starting point is 00:36:55 Yeah. You remember of a bangle? Yeah, it's a, like a thick bracelet. Yeah. Yeah. You know, how you look at your watch, you get this little tiny screen. But imagine if your whole forearm, you give you information. Or you held it, I'm holding my palm up now.

Starting point is 00:37:09 And so you and I are in a conversation. I've got my hands in front of my face right now for those listening. And I'm looking down at my arms. You're going to have AirPods in to talk to you. You might have glasses on to interpret the world. And you might on your jacket. Why couldn't Apple make a jacket? They're really into fashion now, right? They made these very fashionable wristbands. They made a jacket that had an iOS screen where you could get your just your notifications and just swipe them back and forth. This is coming. And you know what? If you want to look it up, there's military applications for a long time. Discrete communication. Covert communication without breaking reality communication. And this is happening in AirPods right now. I told you the story. These AirPods 4s have any gain-changing.

Starting point is 00:37:52 feature of all game-changing features. It says notification from Alex from Slack, production room. Read it. And I go like this. And I nod. And when I'm on my hike around the ranch in the morning, when you post the docket for today,

Starting point is 00:38:05 I nod and it gets read to me. Oh, this is fascinating. I don't have to take my phone out of my pocket and I'm getting informed and I'm still doing my hike. I think this would be the application for these is going to be really curving these onto either furniture or clothing. You can have like a real. a lot of interesting applications are coming

Starting point is 00:38:24 for this technology. I think it's ready to. Cars, there are people going to wrap their car in these flexible screens and they're going to be incredibly loud and annoying and not tasteful and I'm excited about that because I love crass. We just put a flagpole on our house just because we wanted to. But why do I have to swap out my flags? Why can't I just have a flag made out of, you know,

Starting point is 00:38:45 screen and then have it do whatever I want? So I'm very excited about this. LG is a South Korean company. If you want to look more into this, There's notes all over the web. Hard recommend. Jason, why don't we next talk about the robot you teased? Because I feel like we shouldn't leave people hanging. But there is a robot that is dog shaped. Yeah. But acts a little bit more like a quad. You might drive around the ranch. This is super interesting. What we're seeing here is from deep robotics. They announced a new quadruped model. Quadruped. Quadruped. Oh, okay, there it is quadruped. Yeah. So there's a quadruped. What's interesting about this one is it's got wheels. it looks like the dog one that walks around that we've all seen a million times from Boston Dynamics. Other people have it.

Starting point is 00:39:28 Yeah, but this one has the ability to stand upright and roll down steps. And literally, this thing can just fly down a mountain, you know, on a trail with rocks that a mountain biker would need to have some dexterity to do. And I guess because of the way it's designed and the flexibility can go extremely fast. and flip itself over upright. It can lower itself to get better aerodynamics, et cetera. And again, back to warfare. You can imagine, you know, these things chasing a platoon and boom, game over. I think it's going to be a staple in warfare.

Starting point is 00:40:08 I don't know other use cases for this. If you can think of them, I would think search and rescue is going to change forever because you could probably drop this from a helicopter. Now, imagine somebody's lost in the woods or somebody's been injured, a plane. You could drop 10 of these things in 10 different ravines and just tell it, search. Yeah. If you find a human, take a picture and send your GPS port and it's in, you know, finding people lost in a forest fire and sending firefighters out. That's over.

Starting point is 00:40:38 You just send 10 of these things in. Yeah. They're going to be able to search for 24 hours, 48 hours. And if you lose a couple to the fire, no big deal. You lose a couple firefighters. That could be somebody's mom or dad or brother or sister. So I just think this has got a really, some interesting missions. Again, when we talk about these technologies, I like to think about what's the mission.

Starting point is 00:40:58 Yeah. What I love about this is it's a combination of stuff we've seen. So you're right. It is essentially like the Boston Dynamics robot dog, but with wheeled feet, which makes it able to flip over and turn around, which makes it kind of emulate those old children's RC cars that had four big wheels and could flip over and didn't matter which side was pointed up. It's kind of like a combination of like advanced military technology and children's toys brought into one package. But Jason, these are just back to the Votin example, mobile sensor

Starting point is 00:41:27 platforms. Like basically whatever you want to do with them, they can go out and do it for you because they're not restricted by height gaps. You know, if they run into a log, they can just go over it. No need to even worry about balance. I think it's really awesome. And if you're curious about deep robotics, I did a little research. They are based in Heng Shu and they're actually called something else in Chinese, but they go by deep robotics on the English web. And I don't know how much they've raised, but they did disclose a B plus round, series B plus, which I think translates to a series B extension, but mostly the information on them is in Chinese. But I hope after this viral moment, we do learn more about the company because certainly I hadn't heard of them.

Starting point is 00:42:06 And now that I've seen them, I want to know a lot more. I love it. Yeah, it's a pretty cool stuff coming out of China and interestingly it dovetails with our, with our guest Nelson earlier, that how war occurs is going to be how many of these swarms can you build. Not just how many of the units, but like if a swarm equals a hundred of these, how many hundreds can you build? And that's the new tonnage is the number of swarms. And if you could swarm, can you imagine 10,000 of these things, landing? on the beaches in Taiwan.

Starting point is 00:42:44 I mean, this would be crazy. And I was looking up, you know, famous battles, right? And you start thinking about landing on the beach in Normandy. Sure. Or some of the other Pacific battles that were notable with the Japanese. These things would have changed everything about those. And so that's, I don't know what you think, but is this mean less humans die? And we just send our robots to fight each other?

Starting point is 00:43:09 You're a fan of this science fiction. What did science fiction people think? I hate to put you on the spot. I know you've got a knowledge in space, and I'm filibustering to give you a little time. But do more or less people die when we build these swarms and robots? Well, you're essentially asking, will more civilians die? Because if we replace individual soldiers with robots, yes, that will limit, in theory,

Starting point is 00:43:32 combatant deaths. But if we have a robot swarm versus robot swarm battle in the middle of a town, civilians are going to get shot to pieces. So I think, yes, in terms of limiting military casualties, people in the army, the Navy, the Marines, et cetera, but I don't know if this would actually limit overall loss of light. On the science fiction point, two things come to mind. One is the Asimov world of robotics and the rules thereof. He wrote famously the three rules of robotics. None of that applies here, because that is all about how robots cannot harm humans, whereas here, I feel like we're talking about how robots will be able to impact human conflict.

Starting point is 00:44:05 So I don't think that applies. The other thing that comes to mind is the forever. war, which is by, I had to look this up, Joe Haldeman, which describes how humans will handle not just future conflicts, but also future interstellar conflicts. And the lesson from that book, at least as far as that author, put it together, was that humans would remain pretty central to human warfare. So I'm sure there's other examples than Science Fiction University Jason. Those are the two that came to mind first, but I think it's still an improvement to have robots killing robots with some civilian casualties,

Starting point is 00:44:36 than to have humans killing humans with some civilian casualties. I know that sounds a little macaw. I hate to give any spoilers here if you were going to read Ender's game, but isn't the concept of Ender's game as a bunch of video game playing kids are playing a video game that actually mimics a real world space battle, and they're doing it remotely? Yes. So the end of that book is Inder Wiggin, the protagonist,

Starting point is 00:44:59 going through a series of what he thinks are simulations that are, simulations that are tests of his, not a lot of leadership abilities, but tactical prowess. And then it turns out at the very end that he has been leading human ships in fights using the technology called the Ancible, which allows for instantaneous communication. Anyways, yes, and there's other stories that have a very similar bent. So people have been thinking a lot about how we can take humans out and put robots in, either autonomously or with human direction. But we only have one planet, you know, right now. So I do hope that even as, we build cooler weapons technologies, we use them to pursue peace through strength and not

Starting point is 00:45:36 adventurous war. Nobody wants to start wars. And I do think showing that we're making these things is will be enough to avoid most conflicts. And, you know, when we drop a bunker buster somewhere, it does seem like people tend to get the message. And I think that's a part of this, right? And I'm not a warmonger, but if somebody invades another country and you drop a big piece of ammunition, they tend to pay attention.

Starting point is 00:46:04 And if I can tell you, man, if you're, these terrorists must be after what we've seen in the Middle East of late, with the Pagers blowing up, you know, like, I don't, I don't know that I want to join a terrorist organization if they can get to me so easily, right? Yeah. Well, also, I was blown away by that story for the cybersecurity element, the long-term planning, but also I was just blinking. I'm like, Pagers? Is this 1984?

Starting point is 00:46:29 Like that, like the choice of technology that they had picked? They must have picked it because it was low tech, right? I think they picked it probably because they went on a website. Literally, I think they went on like Alibaba and looked for a private paging network that they could leverage thinking they were smart. And I think the backstory here was they knew they were buying page or technology from somewhere and they either intercepted it at the order in China and infiltrated that company or they infiltrated it on route, i.e. maybe those came in a container ship to a port and they figured out a way to unbox them, put the ammunition in them, seal them, rebox them, and have them delivered, which is like an interesting message. If you, you know, want to know how hacking occurs, three-letter

Starting point is 00:47:16 agencies pretty good at intercepting your iPhone order and then your iPhone comes to your house and you unpack it. Unknowingly, it had already been unpacked and repacked with a chip in it. That is taking pictures of your screen, independent of the OS operation. They can put that in there to literally take pictures of your screen, pack it up, and through a separate radio that's been put into your phone, send screenshots of your phone. Lest you think, there's not an easy way to do this because you're using, oh, you know, whatever, signal, et cetera. Yeah.

Starting point is 00:47:50 There are many ways to intercept something you could put into the average keyboard, a keyboard logger. Sure. You think you're unhackable and like literally every keystroke is being. sent to somebody. So the way this was explained to me back in the days of Snowden, the NSA leaks, and when we learned quite a lot about our domestic capabilities in digital surveillance was you can try to keep yourself secure and you, the individual can do a pretty good job if you're smart. You know, strong passwords, password managers, VPNs, you know, the standard array of things. But the other thing I was told was, if a sophisticated nation state wants to surveil you,

Starting point is 00:48:25 wants to hack you, yeah, you're pretty much screwed. Anyways, surgery robots, you found an awesome clip from John Hopkins University that shows off robots that have watched other surgical robots from tasks and can then mimic them with pretty insane precision. And I have to say, I went into this little segment thinking that I was going to hate this

Starting point is 00:48:45 and not want it, but after actually watching, I think I'm going to be fine getting robot surgery in 10 years. Yeah, what's really interesting about this is these robots were trained not to pick up the needle. They watched just a hundred hours of footage of people doing surgery. And so for people watching, don't worry, this is a piece of chicken that they're doing surgery on, or it's a fake piece of plastic that they learn to do surgery on. And what you're seeing here, pause it right there, if you don't mind. And what you're seeing

Starting point is 00:49:15 is there's tying a knot in surgery, right? And so they're using porkloin here. And when it's tying the knot, they try to distract it. And so if you just scrub backwards, just a wee bit here, what you'll see is a screwdriver comes in. And this is tying the knot and it knows to tie the knot based on having watched movies before of surgeons working. It did not ever see a screw come into place,

Starting point is 00:49:45 nor did it know a procedure for dropping a needle. In other words, somebody did not write code a language model, an LLM of some type, consume this information, processed it, And it learned to ignore interference. It also learned when you're looking at this.

Starting point is 00:50:05 Again, don't worry, this is not human flesh. It doesn't look better than it's chicken, man. It still looks a little. And if you scrub backwards, there's another scene here where it shows side by side, two different cuts of meat. There it is. And like one's chicken, one's pork wine. The chicken has got a bunch of marbled fat on it.

Starting point is 00:50:23 The other side is pretty lean the pork, the cut of it. I'm getting hungry now. Yeah. What's interesting about this is, again, it was never trained on how to do different cuts of meat and different views. It just figured that out. And so we will have a surgeon, a robotic surgeon, right? And this robotics has been going on for decades where they can do very tiny things with robotics. Now it's going to be whoever the greatest surgeon is in the world will become studied, along with the other 20 great ones.

Starting point is 00:50:57 field and there's going to be one surgery robot that they'll make 10,000 of and send to 10,000 cities and every city will have the greatest surgeon. You used to have to go to a specific city to get surgery and now it's going to be one amazing pilot flying all the planes in the world, one perfect surgeon doing all the surgeries in the world, and one perfect driver driving all the cabs in the world, all of those professions will be replaced 100% with AI. And if you're not paying attention, it's happening a little faster than people think. Yeah. The other place I think this fits in really well is places you don't have certain things. Like if you're on a container ship, right, for across the Atlantic journey, that takes time. Can you get a helicopter come get you if you've

Starting point is 00:51:47 a problem? Probably not. What if you have an appendicitis? Well, wouldn't you be great to have an onboard surgeon that knew how to do the top, I don't know, Jason, 150 procedures. Like, I don't think they're going to be doing the most, you know, complicated stuff to start. But if you could do even just the big things that come up in commercial industrial settings, that's huge and lower costs. That means you can take them around the world, bring them to markets where doctors only come in for like visits to do work and so forth. So it democratizes care, makes people more safe, seems to be kind of awesome. And also has made me a little bit less interested in eating the chicken.

Starting point is 00:52:21 breast for at least three or four days because that was kind of gross. What you bring up back to science fiction is literally my favorite sci-fi film. Ooh. I don't know if you knew this, but I think my favorite science film, you know, after Blade Runner, in Prometheus, one of the... Yeah. Yeah, such a good film, isn't it? I like it.

Starting point is 00:52:41 What I love about Prometheus is, you know, it sort of explains where the engineers came from and what their motivation were. Mm-hmm. In Prometheus, there's a scene to exactly your point. when they're going halfway across the universe, she's pregnant. Spoiler alert. It's not a baby. It's not a traditional baby.

Starting point is 00:53:00 And she gets into a biopod. You can see her programming the pod. So she's got something growing inside of her. And she gets in there and does a manual procedure and she's talking to the computer. This is literally becoming what we're seeing out of John Hopkins. Yeah. They're showing a robot learning how to do surgery from. videos of other surgeons and as you're talking about, you're on a ship, something happens,

Starting point is 00:53:27 you need to, I think we'll probably stop it here. The best science fiction film though, Jason, I think might be Sunshine, the 2007 film about restarting the sun. If you haven't seen that, hard recommend. Pretty fantastic, isn't it? Yeah, that was a really great one. There was an IPO filing. We should just at least mention it.

Starting point is 00:53:42 Yes. Because it was done quietly, but this is a big one, folks. I, again, don't want to make this show too political here. but I think that this, the timing of this is related in some ways to the newfound business optimism that we talked about on the show would happen if Trump won. Does it mean you have to love Trump? Doesn't mean I'm endorsing him. But he has signaled to the market that there'll be less regulation and the good times will roll. Here we go.

Starting point is 00:54:14 So we're talking about Klarna, which is a Swedish buy now pay layer fintech giant. For those of you who are product nerds, more than financial nerds. Klarna does a lot more than just BNPL today. They have their own card. They built their own shopping app to help people actually do commerce and they're moving Jason into banking with something called Klarna balance. Anyways, the point is they're widening the aperture a bit, but everyone knows them for their BNPL work.

Starting point is 00:54:40 This is a company that went up to a $46 billion dollar valuation back in 2021, only to see it crashed down to like $6.7 billion in 2022. But, Jason, I've been tracking this company nearly quarterly, thanks to its disclosures, and it's had a pretty strong financial glow-up, and now it has filed privately to go public. Comma. Everything you're saying is true, and I think the reason why it's filing now is not just optimism, but also because some of its comps, Affirm, PayPal, and Sessel have also appreciated greatly in the last two weeks. Okay. So, fintech has boomed. Whether it's crypto, Robin Hood, Coinbase, Affirm, Max Levchins, a company that does Buy Now Pay Later.

Starting point is 00:55:19 I think Klarna was the original version of that. And so that whole category, people believe, hey, maybe the financial regulations will be lower. So something like Buy Now, Pay Later would have less regulations or, you know, your ability to charge people a late fee on an account. Not that Clarner necessarily does that. I don't know if they do or they don't. But those type of things are, that kind of regulation is going to be removed. more fluid. So all of those things appreciated massively. I saw my Robin Hood shares went way up. And I had bought Doge. I've only bought two cryptocurrencies in my life. Doge at like, I think,

Starting point is 00:55:58 19 cents. And I was a loser for many years on that trade. And now my money's doubled. Yeah, it's 40 cents. Not bad. My wife put the Bitcoin trade in. We were all talking about it constantly. And I had some Bitcoin, the place we had, it got hacked and those went away. but then the one she bought it $100 a share, $100 a coin, we still have. Nice. Coin broke $90,000. It's going to be a major trade for our family. I can't believe that, you know, this is happening, but here we go.

Starting point is 00:56:29 And I, you know, I wonder what's going on here. Yeah, I have a lot of questions about the depth and honesty of a lot of crypto trading, because there's a lot of wash trading and other sorts of. manipulation. Painting the tape, yeah. Yeah. At the same time, though, I think with stuff like Bitcoin ETFs, and now, you know, we're seeing

Starting point is 00:56:53 Ethereum ETFs as well. We're also seeing, you know, stable coins like USDC, and they've also have a Euro stable coin. It really does seem like there's an open door now to experimentation and trying things. I will just remind everyone

Starting point is 00:57:07 that in Tristan Horowitz wrote about their kind of cryptothesis recently, and they are very optimistic, but they cautioned that there's still work to be done. Just electing somebody doesn't change the rules. They're still probably needful legislation and so forth. But I do think that the expectation of reduced regulation and therefore the ability to charge higher fees, more frequent fees, and just take more money as a fintech player is driving the share price appreciation at a firm, et cetera. And what that does, Jason, and I know you can explain

Starting point is 00:57:36 it's better than I could, is it makes Klarna able to go out at a higher evaluation for free because its comps have been repriced by the market so it can probably sell for a higher price. You know, whoever the last investors in have like probably some downside protections in their documents when they made the investment. And I think the last investment was at 14 billion or something, if I remember correctly. And if you look at that valuation, maybe the public comps would have been 5 billion or 10 billion. And so the people who were the last investors probably said, yeah, let's just keep building. I don't want to go public, convert. When you go public, because of in the wheat's technical thing, everybody converts to common shares. Everybody has the same

Starting point is 00:58:17 class of shares. So if they have protective provisions in their shares that say, hey, we have some downside protection. We're guaranteed to get our shares out at a, that this valuation. And if we don't, we get extra shares. That creates an untenable situation because let's say they bought, I don't know, 5% of the company. Okay. They put 750 million in at a $15 million valuation. They own 5% of the company. When it goes public, they need to have, depending, I don't know if this is the case here, but it wouldn't be uncommon for them to say, when we go public, we have to have 5% of the shares at a minimum. Or if they had a liquidation preference, maybe they have to have double that 10%.

Starting point is 00:58:52 Well, if the company goes public at $5 billion, because that's the comps of the other companies, and they have to have 10% of that, now you've got a little bit of an issue, right? Because they paid $750, but, you know, how much do they have to own in order to have $750,000? They've got to own more than $10%. They've got to own like 15% right. So it's just, which would be dilutive to the other shareholders. So now you've got the standoff. And that's one of the things that's being worked out now as the market comes up or people

Starting point is 00:59:22 get tired of being stuck in an investment. Maybe they say they're willing to come to the table and negotiate that down to get their liquidity. Can I tell you, though, why I want to be full throttle optimistic about this, but I'm actually a little bit concerned. And not talking about Klarna, because I've been tracking Klarna for a long time. And honestly, I think they've done a great job cutting their losses, reducing their operating expenses, get into breaking profitability, and reigniting growth. Shout out to them. It's been a really good job, and I'm going to give them points for it.

Starting point is 00:59:50 But my concern is that it took a market that was already compared to historical norms, expensive, an election of a business-friendly candidate, at least in theory, and then an appreciation from that point to get Clarnet out the door and filed. And that means that the number of things that have to line up to get the public markets rich enough to get some of these unicorns out are kind of rarefied. And what happens if things go down by 10%? Does that mean no IPOs next year? Jason, I'd cry. I think it's just the overpriced ones that raised at sky high ZERP valuations that will be stuck in this indigestion. And they'll be stuck in customs, basically, as they try to get through and get their passport stamp. The other thing I'll note is

Starting point is 01:00:35 Who were the group Brittle me this? Who were the group of people who showed up in this election In a way that hadn't previously shown up? Young men? Young men. Okay. What do young men like?

Starting point is 01:00:48 To do. Vodka. Yes. And they actually don't drink as much as they used to. They like gambling on crypto. Oh, yes. And they like draft kings. If young men showed up

Starting point is 01:00:59 and young men owned crypto and we're in this afterglow. I think there's a bit of euphoria going on right now, perhaps even mania. And people are buying Doge. They're buying Bitcoin, they're buying Robin Hood. I wonder if what we're seeing is the Young Man trade.

Starting point is 01:01:18 YMCA, young man, you don't need to be down. Young man, your crypto's up off the ground. Okay, so Draft Kings has appreciated from pretty much 36 bucks to share to 42, but it's still down on a six-month basis. What is it on like a month basis? Because it kind of became clear Trump was going to win about a month ago.

Starting point is 01:01:38 11% in the last one month of trading. Okay, so that one has it appreciated. In the last month, how much is Bitcoin appreciated? And how much is Robin Hood appreciated? Those would be other ones to look at. And so literally 30 days ago? November, let's do Monday, November 4th. Robin Hood was 24 bucks a share.

Starting point is 01:01:56 Today, it's 33 bucks a share. That's some relatively sharp gains. Bitcoin, I have a seven-day number right in front of me. It's up 24% in the last seven days. It's probably a little bit more over 30 days. But a lot of appreciation. There's a flip side to this, though. There was a really interesting article about, I think it was like sports betting in Brazil

Starting point is 01:02:15 that you can now do on a mobile basis. And there's a lot of people who are loan sharking people to lend more money to keep gambling. And they're paying like 400% on those loans. Anyways, the gist is, yes, people love this stuff. But it does remind me. a little bit of the 2021, you know, mania. Remember when Stock X,

Starting point is 01:02:35 the shoe reselling company was like opening more and more facilities? Everyone was into collectibles. And NFTs, right? What was the big NFT company that became worth like $10 billion immediately? Board Ape Yacht Club. And that was part of Yuga Labs. Yuga Labs became huge. And then there was a website for trading them,

Starting point is 01:02:52 a marketplace for trading them that also became, got picked up on this. OpenC. Yeah. OpenC. Yeah. Right. So all of those were like going to be like tops trading cars plus plus plus plus plus plus plus plus and the bottom fell out I think in that market big time.

Starting point is 01:03:08 That would be when you know mean is fully returned if the price of board apes or those pixelated. I think crypto punks. The original. Oh, crypto punks. Yes. Yeah. Thank you.

Starting point is 01:03:19 You know all this stuff. That's why you're here. Cryptopunks and yeah, the board ape yacht club, man, just shows you like we live through a literal tulip mania. That mania was so sharp and so amazing. And people really thought that it had tons of staying power. I think that the current mania has more legs. I think sports betting will have a longer lifespan than the NFT realm. So I don't know if it gets up to the same heights. Why do you think that? Oh, because people have been betting on sports since the Roman days. I mean, we've been raising chariot in an oval and now we just call it NASCAR, right? Well, and it's connected to a real

Starting point is 01:03:55 world event, right? So there's something. Yes. There's entertainment value to it. And that, I think, is what was missing from the NFT stuff is there's no entertainment value to it. Like, um, the closest thing to an entertainment value to it was when they did those drops where they mutated. Do you remember that concept? This was the famous, you can use multiple slurp juices on one ape tweet. Yeah. Everyone was talking about. Um, can I just say though? And I, look, we on this show are generally, I would say net bullish, right? We're optimistic about the,

Starting point is 01:04:25 future. Cautiously. Yeah, well, I'm trying to not, but the point is, I'm not bullish on NFTs of that variety. And so I'm kind of glad we've left that speculative moment behind, but I am optimistic about more people owning equities and bonds and maybe blue chip cryptos if you want. We have a little exposure through the Fidelity Bitcoin ETF. Oh, so you're happy about this appreciation. I did have a funny moment when I announced on my self-stack that I was going to buy some Bitcoin

Starting point is 01:04:52 on a regular basis just to have some of it in our portfolio. and then the next day it dropped like 10%. You know? I'm really interested to see, you know, my understanding of residential politics is, and these new administrations is you tend to get whatever you're going to get done in the first two years, not the last two years.

Starting point is 01:05:11 And then when you do get stuff done, you tend to get one or two things done as an administration. You kind of can't do everything. And so if we look at the promise set, crypto is one of them, fixing immigration's one of them, Reducing government, the Department of Government Efficiency Doge that the Vec and Elon are going to run, apparently, as advisors for some number of months, 18 months or something.

Starting point is 01:05:36 And they're going to create a leaderboard. I love this idea. And I actually punched up the leaderboard idea on X. I said they should make a leaderboard of not only the people wasting money who get caught doing it and name and shame them if they're doing corrupt stuff. And then on the other side, the heroes who actually say, I know of waste, like not exactly whistleblowers, But hey, I knew we were wasting money, so I got rid of this real estate nobody's using at the FBI or the Department of Education or this. And I thought, like, this is a very innovative thing. But I wonder how much they can execute.

Starting point is 01:06:09 Are they going to get one thing done, two things done, three things done? And what would those things be is, I guess, the real question. Well, I think crypto is. And then what impact they'll have, yeah. Tariffs is the other one, yeah. Well, crypto's easy, I think. All you have to do is take Garrigan's letter out, put in someone who's pro, and stop suing people

Starting point is 01:06:27 and it's kind of off to the races. So that to me seems to be pretty doable. Terrapes also through executive action seemed to be pretty likely. John Thune just won the gavel in the Senate. He's the new Senate Majority Leader. He is relatively anti-tariff,

Starting point is 01:06:41 so that could be difficult to get through Congress. On the Doge point, what I'm curious about is how much they're willing to make Republicans mad. Because to make an example that I always come back to, we have a lot of M1 Abrams tanks, MBT's main battle tanks.

Starting point is 01:06:57 And the army at one point in time when it was reduced the number of MBTs they had in storage because they didn't need that many. Well, what does that mean to the congressional district where those tanks are stored? So it ended up that the Congress told the army, too bad you're keeping the tanks.

Starting point is 01:07:12 So, you know, there's, it's not as easy as, oh my God, look, I found these bureaucrats and they're all playing solitary in their cubicle. There's a lot of thorny political and local issues that are going to come up and two trillion dollars is a big number cut. So I don't know. Who knows?

Starting point is 01:07:28 I mean, in that number, I wonder if that's per year or in this administration, we do two trillion in cuts and it's $500 billion for four years or it's $200 billion for 10 years because we've kind of set this in motion. I think any progress on this, it was my number one issue. I hope that government wasteful spending becomes the issue that the Trump, administration succeeds on and that they're known for. And I hope the thing that they're not known for, just my personal belief folks, is that they don't get known for mass deportations of hardworking immigrants, have no problem getting rid

Starting point is 01:08:08 of the criminals by all means. But I do think that could wind up creating so much chaos. I don't know if you have this in your community or whatever, but there is a sense of dreading concern right now amongst a number. of people I've spoken to about the deportation concept, this mass deportation. And so I don't know if it has an impact on our industry in any way, but I do sense that people are concerned. They're going to lose a nanny, a housekeeper, a restaurant worker, any of those frontline workers could be lost. And then people are confused because Americans won't take those jobs and then who's going to

Starting point is 01:08:49 phildom, right? Right. It's heavily inflationary on the labor cost side. Jason, are you, I'm going somewhere with this, a role of me, are you religious at all? I grew up Catholic. I am spiritual, but not religious. Fair enough. I grew up Lutheran, and now I'm an anti-theist.

Starting point is 01:09:05 I'm taking it a little bit further than you have. But, you know, I was raised in the American Christian petition. And one of the things that was, you know, drilled into my head very politely by reading the scriptures was the importance of being kind and loving to your neighbor. Yeah. And to me, we can debate policy points and use of the National Guard and sanctuary cities and all this. But I feel like we're failing that test in this conversation. And so the sense of dread that you are outlining, it meshes with how I feel about it. Because I don't think the people who want to get their way on this issue in the Trump administration, Stephen Miller and so forth, care about their neighbors. I think they're vindictive. is for Americans, and Americans only, was the quote. And I just thought to myself, well, isn't that the opposite of everything I was taught?

Starting point is 01:09:55 America's for immigrants to come and make a new life for themselves if they work hard. And so... Yeah. Sorry. I mean, the actual liberty doesn't have a little finger. Yeah, I kind of still believe in it. I do want the people to come in legally, of course. I do think this will become the debate of the next two years is how do we do this,

Starting point is 01:10:16 compassionately and thought. And so, you know, we'll be tracking this immigration issue because it does impact the business industry massively. I think one of the thesis or a thesis that I've been hearing is there is a belief that there is going to be massive job destruction because of AI and that we are suddenly going to go from this 4% unemployment to 14% because of AI. and I just described it with surgeons, so I can't be too faced on this issue. I just said there's going to be like a lot of surgeries being done by robots and a lot of self-driving cars and a lot

Starting point is 01:10:55 of pilots that are auto autonomous. Now, that could be occurring 5% of the work a year for 20 years. Who knows? And then there's going to be more consumption, so who knows how it nets out? But I don't know what you think of that theory, that people want to export 15 million people because they want American companies to be forced to raise wages, ostensibly a good thing, in order to fill those positions with Americans who are about to lose their jobs as truck drivers, as cab drivers, as cashiers, as perhaps even knowledge workers, or even professions like a certain. surgery. Seems far typical, right? But this is a system, right? We're talking about a system. Yeah. Not one component. There's a massive system here. What do you think of this theory?

Starting point is 01:11:48 Well, one of the biggest professions in the United States is driving trucks, right? If you look at the most popular professions across many states, truck drivers are very high up there. So let's say we turn to all autonomous trucking, which I think you and I both think is the direction we're going in. And you take all of those people, which were, by the way, Trump voters, ironically, and say, okay, well, you're going to, You're going to go now be short order cooks at restaurants and you're going to get paid mostly in tips and you now work these hours. I don't know if there's going to be a direct translation of AI eliminated jobs and then those people being willing to take jobs that historically were staffed by immigrant and migrant labor. There might be some really tough gnash of teeth about that. I don't know if that would be politically palatable.

Starting point is 01:12:31 And so I wonder if there's going to be an extension of the current populist movement, if you will, into protection. And I think that does nest under tariffs and so forth. But if you export people, drive up labor costs at tariffs, you're going to have a wage price spiral, which is not popular ever. So I don't think this is going to be a non-disruptive next 10 years in our economy. And I hope that the people we have in leadership are technocratic enough and empathetic enough to be intelligent about change, while also realizing that we're talking about humans inside of a system and not just robots inside of a system. sticking with my abundance goal, I want to see us have 500 million Americans in the country in 10 years and 10 new cities that can house 15 million people each. I'd like to see us grow the population dramatically and have 10 new cities, maybe 20, with 5 to 15 million people in each in our lifetime, like literally a Manhattan project to build the number of Americans and the number our cities here. We, I think we should be growing. I think we should be growing massively. And we should be ambitious about that. So I, anyway, could just agree more. Big America is, is my thing.

Starting point is 01:13:45 Because I remain wholeheartedly into the depths of my soul's of my feet, an American believer. So, all right. That's my politics. There you have it, folks. This is, uh, Captain nuance along with Captain America here. Chopping it up. The robots are coming and new weapons technology. And hopefully, we make sense of it all and we'll be tracking it here three days a week on this week in startups bye bye and don't forget on tomorrow we're alive

Starting point is 01:14:12 not on Friday on Thursday this week so if you're all in tape and move to Friday right and tomorrow just to give you a teaser by Combinator just dropped their new request for startup list we have this we are going to go through it and handicap our ideas talk about some leading companies it's going to be a blast Jason I'll see you tomorrow

Starting point is 01:14:30 here on the show all right peace out everybody

This Week in Startups - TWiST News: Underwater Drones, Robot Swarms, and Klarna's Going Public | E2043

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