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TBPN is a live tech talk show hosted by John Coogan and Jordi Hays, streaming weekdays from 11–2 PT on X and YouTube, with full episodes posted to Spotify immediately after airing.
Described by The New York Times as “Silicon Valley’s newest obsession,” TBPN has interviewed Mark Zuckerberg, Sam Altman, Mark Cuban, and Satya Nadella. Diet TBPN delivers the best moments from each episode in under 30 minutes.
You're watching TBPN. Today is Friday, 09/04/2026. We are live from the TBPN Ultradome, the temple of technology, the fortress of finance, the capital of capital.
Speaker 2:That's right. Let's get that Christmas countdown.
Speaker 1:First, let me tell you about ramp.com. Time is money. Save both. Easy to use corporate cards, bill pay, accounting, and a whole lot more all in one place. How many days?
Speaker 2:There we go. A hundred and eleven days until Christmas.
Speaker 1:A hundred and eleven days until Christmas.
Speaker 2:The Christmas countdown is helpful because Yeah. One, gives you something to look forward to. Indeed. But, also is a subtle reminder that you only have a hundred and eleven days left in this year. Yeah.
Speaker 2:It's game time.
Speaker 1:It is. It is.
Speaker 2:It's game time.
Speaker 1:Well, we're we're excited for it. Big news in the AI world, obviously. Astra GPT six launched yesterday. We went through the blog post briefly. It went up mid show.
Speaker 1:Bunch of impressive benchmarks. We talked about Arc AGI. We moved the goalposts because Arc AGI v three is now saturated, which is particularly crazy because of how detailed those games are when you play them. The thing that stuck out to me though was watching the demos of people build three d scenes in Blender using Astra. Clearly, a bunch of people got access to the model before and were able to fire off one prompt, maybe a few prompts.
Speaker 1:It it feels like it's very, very capable to just fire a blender and do a full task and model a whole
Speaker 2:world, basically. That said, Matt Schumer, who had a couple of the most impressive examples Yeah. He has been talking about how the art of prompting is back. Oh, interesting. He He had a very specific process where you have like
Speaker 1:A loop manager agent Okay.
Speaker 2:And sub agents. Yeah. It's and it's Still not as simple as just like, you can get a good output
Speaker 1:Yeah.
Speaker 2:Doing, you know, in one shot. But to get some of these really incredible outputs does take a little bit of refinement.
Speaker 1:Yeah. And I'm sure a lot of that information will propagate across the Internet as it already has. I'd love to pull up some of the images from or the videos from the launch from folks who are actually test driving GPT six Astra. First, Sharif Sharif said, GPT six Astra recreated the Palace Of Fine Arts in Blender. This is my favorite building in San Francisco because it was built for the World's Fair in 1914.
Speaker 1:I didn't know that. Where the steam locomotive and telephone were showed off. Wow. It was a time when technology gave us all a deep sense of optimism for the future. I feel like I feel like some of that sense has been lost since, certainly.
Speaker 1:But I hope models like Astra can help restore it and push us towards a more hopeful future. So if we can play that actual video, you can see. So I I imagine that it pulls images from the from the Internet. There's a whole bunch of, obviously, reference diagrams. There's a whole bunch of different ways that you could ground a three d modeling exercise.
Speaker 1:You could even pull the blueprints. There might be free architectural plans. And, yeah, it it is this odd thing where you could use an AI image generator because the AI image generators are knowledgeable about what the Palace of Fine Arts is. It could generate a bunch of images there. So there's all these different ways to triangulate it.
Speaker 1:And then you can also just go on I think Sketchfab is one of the big free three d model purveyors online. And so you could potentially go grab an actual three d model, build off of that for your scene. So there's all these different ways to solve a problem and Astra seems to be good at actually going and doing it. There's a few more that we should look through. There's one comparison since this is the new Pelican bench apparently.
Speaker 1:Same same same prompt, same goal of creating this fly through video for real estate scene. And this feels like something that could be useful. I've already seen on Zillow there is the ability to restyle images. So if you're looking at a house on Zillow, you can see the interior photos, and then you can say, I'd like to redecorate this in a modern style or in a contemporary style or in a colonial style. And it will go and use AI image generation on the back end to do that.
Speaker 1:It's only available on a fraction of Zillow listings. It's clearly some sort of feature that they need to turn on. But you could imagine this being something especially for spec homes that are selling that maybe haven't been that that they don't have the budget to actually go do proper rendering just be bring lowering the cost you get sort of a Jevin's Paradox moment. There's another one from Thomas. He says Astra is very good at three d modeling and the lighting is way better than this one.
Speaker 1:This is this is what this actually looks properly ray traced, properly lit, really thoughtfully designed. Maybe that's in the prompt. Maybe that's just the way this one turned out based on the photos from a Blender scene to then an Unreal Engine five walkable experience. So everything becomes translatable. You'll be able to take your tweets, turn them into blog posts, turn them into videos, turn them into three d games on
Speaker 2:video video games. Games.
Speaker 1:Basically. Basically. And so there's a little bit of a prompt and Thomas reveals a little bit about his process here.
Speaker 2:I would like to see VCs, if you're gonna put out an AI blog post. You know, a
Speaker 1:blog post. Like a market map.
Speaker 2:An essay. No. If you're gonna put out an essay that was clearly written by AI Oh. You should be required to put out a video game that accompanies it. Yeah.
Speaker 2:That's sort of playable that gets the
Speaker 1:instead of a instead of a market map, make it a Fortnite map. I want to be able to play in the different, you know, town is a popular AI startup. Might land on a market map, should land on the virtual Fortnite map. I like as well. Who else said this?
Speaker 1:Yufan Yee. I think this was interesting. There there's another there there's some debate over this last one whether there was like a different harness involved. But same thing, give it a Zillow listing, can three d model the house. So this it's it's always with these new releases, it's interesting what makes you feel the AGI or not.
Speaker 1:Realistically, Frontier Math, tier four, I think they scored 99% on that. Terminal Bench Science 0.1. They're just numbers to me. Like, they they they don't do anything for me emotionally because I don't have any grounding in how hard those particular things are. And also, I sort of I sort of assume the computers are good at math.
Speaker 2:And you didn't get past algebra and like, look how successful you are.
Speaker 1:Right? Exactly. Exactly. So so those accomplished
Speaker 2:all of this off of algebra one. Yeah. Yeah. Freshman level math Olympiad.
Speaker 1:Yeah. Exactly. So those are never really feel the AGI moments for me. But this but I I've actually spent hundreds if not thousands of hours in three d modeling software, mostly in Cinema four d and Houdini. And it was really fun.
Speaker 1:I really enjoy making three d renders and motion graphics. And it was also useful when I was making YouTube videos. But every step in building a scene requires you gotta watch a YouTube tutorial, then you gotta look up how all the different functions work. And then ultimately, you're tweaking settings in literally four dimensions because it's a three d scene, but then over time you have to map where the camera goes, where the different objects are moving, how things progress over time. And it can also be very compute intensive.
Speaker 1:So there's there's a whole bunch of times where just to preview the scene in low res, you might have to cache and load and and pre bake certain animations so that you can just see what it looks like and then you're like, bah, it's not there. I got to go back and change some setting for some sort of smoke simulation or some sort of fracturing that's going on. And so it's fun, but it is extremely cumbersome. And ultimately, you're doing this on a two dimensional screen and it can be very time consuming and frustrating. And so by the time I stopped spending time on motion graphics, is around 2021, I'd been building the YouTube channel and hired a few a few editors.
Speaker 1:Some of them were good at After Effects. Some of them learned Blender. Blender was ascendant at that time. So Blender is the open source community led effort. Cinema four d is a closed source piece of software, very expensive, was very expensive.
Speaker 1:Was like over a thousand dollars to get a license that would be good for like a year. Then they eventually went subscription. And so there were pieces of software that were used by Hollywood but were very expensive, very high barrier to entry, so you didn't have as much of a flourishing ecosystem. Blender at in 2021 was clearly on this trajectory where it was going to build this ecosystem and become very, very popular. And it and it did.
Speaker 1:But by 2021, I was able to hire video editors who were able to go do scenes in Blender. But still, it was a huge ask if I was like, for this YouTube video, I was posting every single week. I'd like a motion graphic to illustrate something. And I did this one where we built a three d battleship board for this US China Military Competition competitive analysis. And I mean, it's like it sort of ties up an editor for a week while they're working on this and and this just speeds all of that up.
Speaker 1:So you're gonna get back to like the is it over for motion designers that worry about job displacement. I think we've been through enough of these cycles that hopefully we're Jevan's paradox pill at this point. We imagine
Speaker 2:a world comp it to software engineering.
Speaker 1:Yeah. Exactly.
Speaker 2:There's a lot more three d renders. It seems like seems like everything something is unlimited. Anything that can be rendered will be rendered. Yep. And and it's just and and more people are going to try to make something themselves Yeah.
Speaker 2:And then hit the point where they're like, okay. There's this sort of area where where the models Yeah. Can't can't get it to a 100%. Now I need to actually go find, you know, find somebody who's an expert
Speaker 1:Yeah.
Speaker 2:Work with them.
Speaker 1:Yeah. Yeah. Totally. And so we're back on the is this AGI question. The Wall Street Journal said, yes.
Speaker 1:We are entering the era of artificial general intelligence. It's in the journal. They've declared it. Although entering the era, like, the door the house is AGI, the door and we are enter we're like almost in the AGI era according to The Wall Street Journal. I don't know.
Speaker 1:Stripe called it AGI. Didn't they call it AGI January 1? Something like And there's been various calls. Tyler Cowen called it AGI like three years ago. He was ready to rock.
Speaker 2:I think that was GPT four.
Speaker 1:Something like that. No. It might have been o one. I think o one he was like this is a this is AGI. But it's clearly artificial, clearly intelligent.
Speaker 2:And don't don't you think he'll end up looking like pretty good in the fullness of 100%. On that call?
Speaker 1:100%.
Speaker 2:Because it clearly is this like timeline of spectrum. Yeah. I do like to imagine the the the Stripe, the colossians just like at at like just after midnight Yeah. You know. There's champagne, maybe some sparklers, some fireworks and they just go, that's it.
Speaker 2:It's AGI. It's AGI.
Speaker 1:But the question is no longer is it artificial? We know it is. The question is no longer is it intelligent? We know it is at a lot of different tasks. The question is how general is it?
Speaker 1:Because Blender is open source, can be downloaded and copied a million times into reinforcement learning environments. We know that OpenAI bought quote tens of thousands of Mac minis and Mac studios to do computer use training on. And so the question is, is it only good at Blender? Will it work in Cinema four d? Will it work in Houdini?
Speaker 1:Will it work in a small piece of software that does three d modeling that has been fall has fallen by the wayside? Now there's an interesting dynamic here where I was in the boat of I could see that Blender was going to be the new hot thing, the best tool that I should have moved, but I already had so many plug ins and textures and rendering and I knew the layout that I downloaded Blender, opened it up and I was like, I don't really don't want to have to get over this learning curve even though I know in five years Blender is going be way better than Cinema four d. There's this switching cost. Now, you're in this weird world where it's pretty good if you're a software company where the Frontier Labs bullseye lands on you. And I'm I'm thinking about Slack, like Alex Wang at Meta just moved them to Slack off of Teams where they had like an internal workspace thing.
Speaker 1:And specifically he said For Benioff. Give it up for Benioff, truly. And specifically he said Slack is better for work with AI agents. And why is that? Well, it's because the Frontier Labs all use Slack and so they have Slack as a reinforcement learning environment and so it got really good at Slack.
Speaker 1:And I think that even though there are open source Slacks and you can vibe code a Slack competitor, as we have tested, Slack was the logical tool to pull off the shelf for the AI companies, for the AI agents, for the models and Blender seems to be that. So the interesting thing is that I I do wonder if people will wind up shifting from Cinema four d to Blender because the models are better at Blender? Or will the models generalize and say, yeah, this looks a little bit different because it's a slightly different piece of software, but I've trained so many hours in Blender that I can also do Cinema four d or also do Houdini. Because some of those other softwares are better at certain things. Some of them are better at smoke simulations.
Speaker 1:Some of them are better at water simulations. There are advantages Yeah. To each piece. I don't want to degrade any particular piece of three d software. I love them all equally.
Speaker 2:But I think There are some reports that it's that it's quite effective at at video editing.
Speaker 1:Cool. So I'd be interested to to to take it for a spin. I wonder the the interesting thing is that most video is still edited in Adobe Premiere. It's a closed source Adobe, you know, they they have their guardrails. They probably they might not want to, you know, say, oh yeah, sure.
Speaker 1:Take 10,000 licenses. No problem. Pay us $10 a month for that. They might they might have a different opinion. They may want an AI agent that's internal.
Speaker 1:There there might be all sorts of different things. But then again, there are pro there I mean, I know that there are open source video editing suites out there. I think that they lag a little bit, but there are some that are free or or or open source at least. The the other interesting thing, I mean, video editing, like all these things, like taste is so important in these. It's it's it's often less about the the the exact the exact instructions and more about the, like, telling the right story, using the right tools, not creating slop whether you're doing it yourself or with an AI agent.
Speaker 1:But I I think that gets to the core question of like how do you evaluate these model launches. We were discussing the idea that like the benchmark era might be coming to a close in some in some way because as soon as the benchmark's created, it's hill climbed very, quickly and then it's at 99 or a 100% pretty quickly and everyone sort of their eyes start glazing over in benchmark discussions. And it just goes back to like the vibe check. I think the the the best thing to do when a model comes out is just take it for a spin. And mostly, point it at something that you know really well because you don't want to be in the you you want to expose the models.
Speaker 1:What what what's the what's the gal man amnesia? That's the one I'm thinking of. You basically want to test if gal man amnesia is triggered by you using the model. So point it at something that you intimately understand and see if you're impressed. And then Yeah.
Speaker 1:Because you pointed at something What? Yeah. Yeah. We got to do the horse bench again. We have a couple couple more.
Speaker 1:Let's see comedy. I wanna I wanna see some new jokes. Shrimp fried rice bench. Also interesting, Gell Mann Amnesia not created by Murray Gell Mann, the physicist who was at Caltech who lived in my hometown and his house is actually for sale right now. But he was having coffee regularly with another physicist.
Speaker 1:I forget what his name was but he's really famous. And the other guy was like, we noticed this together, I'm naming it after you. Do you have the story? Did you look this up? The origin?
Speaker 2:It says it's named after Nobel Prize winning physicist, Gale Mann.
Speaker 1:Yes. It's named after him but it was coined by his buddy who was another physicist who was like
Speaker 2:Michael Crichton.
Speaker 1:Is that it? Okay. Yes. Yeah. So they were hanging out, having coffee, they realized this thing and it's like
Speaker 2:Tyler should name this specific situation. Yeah. Cosgrove Paradox.
Speaker 1:Where where Where where someone asks you to fact check something they don't really know anything about. Anyway, we can move on because there's a whole bunch more news. Let me tell you about Cisco. Critical infrastructure for the AI era. Unlock seamless real time experiences and new value with Cisco.
Speaker 1:So oh, there are other reactions to Astra we should go through in the timeline. The big one comes from Joe. He says, you're never gonna believe it, but someone one prompted the new model to make a completely new and immersive three d game. Yes. The bar has already been raised.
Speaker 1:The goalposts have been moved. It's not enough to make a game. It has to be funny, entertaining. And I don't know. I I know how I I feel like a lot of people are taking the easy way out with these web based games.
Speaker 1:Playing a game on a MacBook Pro in a Chrome tab, that's not real gaming. It's gotta be it's gotta be running
Speaker 2:In Steam?
Speaker 1:PC, on Steam, or on a PS five, or on an Xbox. It's gotta it's gotta have more to it than just some fun game that you can play around within the browser. I do love that the browser games are coming back. Like, don't know if either of you ever experienced like the Flash era, but like Flash games were huge. Line Rider.
Speaker 1:Line Rider. Okay. What about you?
Speaker 2:In elementary school, we'd play on cool math games.
Speaker 1:Cool math games. Okay. What what game? Line Rider or something else?
Speaker 2:I don't know. I don't know. I don't remember. There's so many.
Speaker 1:Was Sorry? Just like I paid You put any money on it ever? Didn't make any money? Let's see. There's also some updates.
Speaker 1:Token pricing is effectively meaningless now. The benchmarks are meaningless. The token pricing charts are meaningless. Everything's meaningless. No.
Speaker 1:So Steven Heidel is sharing the cost efficiency, how you should think about cost efficiency in the modern era. So 3.8 Flash looks 13 times cheaper when measured per token but Astra is cheaper per task since it's far more efficient. Measure your cost per task, not per token. So interesting. I will we see a decline in if models get more token efficient, will we see a decline I mean we probably won't see an actual decline in in token volumes.
Speaker 1:But we've seen Sundar Pichai from Google and Alphabet stand on stage and talk about the exponential increases in token volumes. But you might see a kink in that graph or like a deceleration to some extent if models just get way more token efficiency. Like if the next version of Gemini or 3.8 Flash is 100x more token efficient, you might see a little bit less growth in token volumes but they might be doing more valuable work than ever. So sort of an interesting nuance you got to adapt to the modern times, I suppose. So the intelligence index versus the output tokens per intelligence task, There's a whole bunch of charts you can dig through.
Speaker 1:Let me tell you about the New York Stock Exchange. Wanna change the world? Raise capital at
Speaker 3:the New York Stock Exchange.
Speaker 1:Jordy, any other Astra reactions you wanna go through?
Speaker 2:I think we'll have more by Monday. Probably. As more people get it.
Speaker 1:Yeah. Yeah. We need we need a break. We need a break. We need a we we we need a
Speaker 2:It's about that time. No. No.
Speaker 1:Mean Not
Speaker 2:for us. But but the
Speaker 1:AI leaders, for the executives, for the enterprise leaders, we need them to be able to digest the model. That typically happens over Christmas even though we're doing the road Christmas. No. But
Speaker 2:we've talked about three day weekends.
Speaker 1:Oh, yeah. Three day weekend's coming up so people will Labor be able fire it Okay. So yeah. It's yeah. Labor Day.
Speaker 1:It's got to be everyone's got to be spinning spinning up Astra by tomorrow. Lock in. Hopefully, you don't have any real plans so you can stay inside and vibe coat. So you can understand, you know, where the model's strong, how you want to deploy it, what you want your employees doing with it, etcetera.
Speaker 2:Jack Altman saw the benchmarks and said, Sam exclamation point, I guess even a blind squirrel can find a nut sometimes. Congrats.
Speaker 1:That's good. That's good. I like it.
Speaker 2:So good.
Speaker 1:Anyway, we should move on to the jobs report because even though AI is getting better so is The US employment picture. The US added a 162,000 jobs in August. Sheesh. That is a lot of jobs. Also, what's interesting is that the the Wall Street Journal had an op ed They're
Speaker 4:a violation.
Speaker 1:Had an op ed just I mean, it just printed today. It it went to it went to print online yesterday. But saying, why we'll have to get used to meh job reports. The economy doesn't need to generate all that many jobs to keep the labor market steady but that won't keep low job growth from feeling dissatisfying. So economists think or they thought that Friday's jobs report will show The US added seasonally adjusted 53,000 jobs in August.
Speaker 1:The number came back a 162,000. Three times what these what these economists what were the economists doing? A sleep at the wheel. They're on summer vacation maybe. Who knows?
Speaker 1:That would be a step up from July's unexpected loss of 23,000 jobs which of course was now revised upwards. So we actually did add jobs in
Speaker 2:Oh, got an upwards revision. Yeah.
Speaker 1:Upwards revision.
Speaker 2:You don't see that much. No. Usually
Speaker 1:Narrative violation. Usually.
Speaker 2:Yeah. That's a narrative violation.
Speaker 1:There's a whole bunch of interesting there's a whole bunch of interesting dynamics going on in the economy. The the the Wall Street Journal has been doing a great job highlighting the the the main street millionaire, the small town entrepreneur, what's happening in the broader real economy, not too focused on what's happening in tech and tech jobs where obviously a very small employee base can create a really outsized outcome. Nothing shows that better than Hugging Face. Couple 100 employees, dollars 12,000,000,000 outcome. And that's not the nature of The US economy.
Speaker 1:That is the power law. That is the the outlier. And But it's easy to track and say, oh, well, like if if you're making a $12,000,000,000 business with just a couple 100 people, there's not going to be any more jobs. But that's not the way The actual US economy works. So what is going on with The US economy?
Speaker 1:The August jobs report is out and it is good. It blew past expectations with The US adding a 162,000 jobs. Economists polled by the Wall Street Journal said that The US would add 53,000. That comes after both the June and July jobs reports were revised up to 31,021 respectively. So the unemployment rate remained at 4.1% which is historically low which indicates that we generally have a healthy labor market.
Speaker 1:The jobs added were fairly broad based from the Wall Street Journal. Food services and drinking places were a standout. Let's go. With an increase of 59,000 jobs and people were worried about this post World Cup slump. You remember this?
Speaker 1:Yeah. Yeah. And so it seems like whatever happened there, whatever gyrations happened, people are still dining out. People are still going to bars and so they're hiring.
Speaker 2:I think it's quite possible that recent model advances are allowing people to have more power lunches. Yes. Might have historically been a Friday thing. Yeah. Maybe now they're adding Monday, Tuesday, Wednesday.
Speaker 1:Sort of a Thursday. Let Astra take the wheel scenario
Speaker 2:Yeah.
Speaker 1:After 1PM in many offices across the country. Yeah. Could be a could be a thing.
Speaker 2:Could be that.
Speaker 1:Similarly, local government education gained 42,000 jobs after losing 58,000 jobs in the prior months. Manufacturing was among the sectors registering job gains as was healthcare as has always been the case. Healthcare continues to boom. The information and finance sectors shed jobs while economists are divided over how artificial intelligence will divide the market. Those sectors are generally viewed as among the most exposed to technology.
Speaker 1:At a minimum, the report is an argument against the Fed lowering rates in September. Before the report, markets have been roughly divided on the prospect of a hike. It also seems that the AI jobs apocalypse is still on hold at least for another month. And of course we'll discuss this on the show. Let me tell you about Shopify while Jordy queues up the next story.
Speaker 1:Shopify is the commerce platform that grows with your business and lets you sell in in seconds online, in store, on mobile, on social, on marketplaces, and now with AI agents. Do you have anything? Because I got a big story here we can read through, but it's a long one.
Speaker 2:Yeah. On on the on the rates debate, the president was over on Truth Social
Speaker 1:Mhmm.
Speaker 2:Today asking for a rate cut and making a bunch of various threats
Speaker 1:Mhmm.
Speaker 2:Around halting trade with a number of of our trade partners if we don't get a rate cut. So hopefully, the market shrugs it off and that's all I
Speaker 1:have. Okay. Let's move on to some funny timeline post. The timeline. Because Logo Daedalus has a funny one here.
Speaker 1:Slop does not come from AI but from the heart of man. AI only reveals the slop that is already in the heart of man. What man desires is slop. The problem with the the problem is with man not the machines. Very eloquent.
Speaker 1:And then Tom Cruise says, not the real Tom Cruise, but a a non account says, I am joining the war on artificial super intelligence on the side of artificial super intelligence with a crazy screenshot that we need to keep on the screen too long.
Speaker 2:Moving. Keep
Speaker 1:AI outage of course and people are saying code with a without AI and it is the the Odyssey try and string this bow challenge. We really should have put Tyler to the test yesterday. Biz Buzz, do it. Python, good luck. You only have github.
Speaker 2:Tyler's first thing, he would go to chat and ask what programming language is good for somebody just getting into programming. And then realize it was down. Completely halted. Mhmm. This was a heartwarming moment.
Speaker 2:A tennis player who's retiring at the end of the year says his next career after tennis will be in finance.
Speaker 1:Let's go.
Speaker 2:And I just wanted to give a round of applause. That's great. Super super herbal.
Speaker 1:I have a new chapter coming next year. I'll be working in finance. I already signed to work in wealth management in a Swiss company. My next chapter is looking more in an office and working in finance. I I know some I know some former pro athletes who have gone into wealth management and it's a it's a fantastic fit.
Speaker 1:They've had fantastic careers. It makes a lot of sense. You can go play golf and tennis with your clients and you meet a lot of interesting people while you're on tour. It's a it can be a very very good fit, especially if you have the passion for it even before you wound your career down. But Major partnership news.
Speaker 1:Huge partnership
Speaker 2:Sam has partnered with Jim Riley at what is it? Carolina AI. AI. Charleston Let's pull up this video.
Speaker 1:Partners with Monaco. Let's watch it.
Speaker 2:This is big.
Speaker 1:As you know, I'm Jim Riley, cofounder of I do know. AI's come to to Charleston. It's already here.
Speaker 2:AI is coming to Charleston. It's already here.
Speaker 1:Partnering with Monaco, we can bring AI to all of South Carolina, which is what I wanna do. I really wanna bring AI to everybody in South Carolina. And with their help, their program, their AI, we can do that. So if you're a founder and you need assistance and want help identifying potential customers, people that will use your product, Monaco is the way to go. Just like how I'm
Speaker 4:using them.
Speaker 1:This is awesome. Talk about moving quickly because if this video went up even one week from now, it could be like, oh, eye roll. Like, we've we've seen a couple of this guy's video. Yeah. The the memes that this is so fast.
Speaker 1:Really great execution. Timing's everything with these things. Very funny. Congrats to Monaco and Sam Blonde on just a just a fun moment. And I mean, like unironically, he seems like someone who is a great evangelist who's going to actually aid in AI diffusion.
Speaker 1:And There's no
Speaker 2:clip of
Speaker 1:It is a
Speaker 2:there's zero clips of Jim Reilly talking about AI doom. Yeah. And that we know of.
Speaker 1:Don't ask what There
Speaker 2:could have been a podcast in
Speaker 1:2018. Don't look him up unless wrong. He might be on there. Who knows? He might have been in a Bay Area group home.
Speaker 1:You don't know that yet. But hopefully, he was just a normal businessman.
Speaker 2:Yeah. He may have read possibly read the basilisk and realized he needed to Oh,
Speaker 1:This is all an elaborate Rocco's basilisk gambit trying to trying to please the future AI gods. Well, NVIDIA has released AI god mode for gamers. It's called DLSS five. They've been working on this technology for a while. Deep learning super sampling.
Speaker 1:It takes the current game resolution, up ress it using AI. Some people hate it. It's very controversial. I think it looks great. Let us know what you think.
Speaker 1:Watch this video of Kingdom Come two. This is being rendered in a game engine and then passed through DLSS five to make it more photorealistic.
Speaker 2:Changes everything.
Speaker 1:Okay. Yeah. Truly, it does still look like a video game to me. But that's not entirely the the point with this. It's just to get to get you just one little notch up.
Speaker 1:It's not it doesn't actually feel fully like a movie, but I don't know. I thought it was good. I'm excited for this. Should Kettle and Fire acquire Campbell's Soup? That's what everyone's asking.
Speaker 2:A 100%, yes.
Speaker 1:Yes.
Speaker 2:I I actually have fond memories of Campbell's Soup. Yes. As as a kid, I would go surfing
Speaker 1:Mhmm.
Speaker 2:And then I'd be really cold, which has created some controversy Mhmm. Online. We had an Instagram reel, went viral.
Speaker 1:That's right.
Speaker 2:I was saying that Yeah. At least in cold waters, Northern California, not not wasn't great for me to surf before needing to be productive.
Speaker 1:Yeah.
Speaker 2:That pissed a lot of people off.
Speaker 1:It did.
Speaker 2:But I would come home and I would have some Campbell's Mhmm. Campbell soup. It was fantastic. But you can imagine that the quality of the product was actually probably pretty bad back then.
Speaker 1:Mhmm.
Speaker 2:And I'm I would assume that it's gotten far worse.
Speaker 1:Mhmm.
Speaker 2:And so if we could get Justin in there to fix it up, get it back on track, I'd love to see that.
Speaker 1:I I I think it'd be very interesting. And it does not seem out of the realm of possibility at all. Justin's a fantastic entrepreneur, fantastic investor. Yes. Campbell Soup is a larger company.
Speaker 1:Market cap in the in the single digit billions, I believe. Campbell's
Speaker 2:6,400,000,000.
Speaker 1:Yeah. But you get the right investors around the table. Obviously, it's a it's a very old company On lot of debt.
Speaker 2:9,000,000,000 of sales.
Speaker 1:He's within striking distance there. I think he might be creeping up on them. One
Speaker 2:One broth container at a Yeah.
Speaker 1:Broth
Speaker 2:container. Box of broth at a time.
Speaker 1:One box at a time. Ryan Peterson has a But we've been saying this for a long time that like that like when when when a large legacy company is has has done the the McKinsey consultant as CEO and they've done the the suit and they've done the okay. We hired the person who is internal and climbed the management ranks. It is interesting to try and put a founder of a smaller company just in the top job and say, go founder mode, try something new. But there's still not that much appetite for it.
Speaker 1:So what are you thinking?
Speaker 2:Ken Wattana says, why are all the a sixteen z partners tweeting about karmic retribution today? Yes. I saw a post from Alex Rampell saying karma is a swear word. Ryan Peterson has a pretty thought provoking theory. He says, conspiracy theory, I choose to believe that Marc Andreessen was funding Pablo Torre's Steve Ballmer investigation to get back at him for Internet Explorer.
Speaker 2:The ultimate punishment, banned from your own arena.
Speaker 1:That's a funny That's a funny karma moment.
Speaker 2:Yeah. Pablo Torre dropped a new investigation
Speaker 1:Mhmm.
Speaker 2:Into the Dodgers this morning. Mhmm. I was listening to it on the way into work, it is fantastic. He is one of the greatest podcast one of the greatest living podcasters, which pretty much includes almost all podcasters ever. Yeah.
Speaker 2:But really, really crazy story. Mark Walter, you know, setting up and Magic Johnson is involved in quite a big in in quite a big way. So highly recommend going and and checking out that story.
Speaker 1:Yeah. I'm excited for that to develop. Again, yeah. I mean, with any of these allegations, it'll probably take a year of investigation to get the actual results. But get ready to learn about insurance because the untangling a lot of these different organizations is very, very difficult.
Speaker 1:But it can be really interesting. What's Ryan Harmon working on these days? Before that
Speaker 2:Okay. We don't have to pull up this image, but has Burning Man fallen off?
Speaker 1:I have no idea. I think they had a rough go after the I've never been. I I think they had a rough go after the, the muddy one. There was one where it rained like crazy, and it was really, really muddy. And I think everyone was like, that was a lot.
Speaker 1:I don't know if I'm going back next year. And then also COVID might have switched things up for a little bit. I think they might have skipped one. So a couple different moments of like, okay. A lot of like like washing out certain people, but then also
Speaker 2:Yeah. It seems like it seems like it's it doesn't necessarily have a massive inflow of
Speaker 1:Mhmm.
Speaker 2:Net new young people into
Speaker 1:it. Yeah.
Speaker 2:And and the the Burning Man population is is just is aging up.
Speaker 1:Yeah.
Speaker 2:Which which doesn't mean that Burning Man, you know, hopefully for BlackRock, you know, this doesn't mean that
Speaker 1:Yeah.
Speaker 2:Burning Man's going away
Speaker 1:anytime We'd hate to see BlackRock City, obviously named after Black Rock, the financial institution.
Speaker 2:Yeah. Probably some sort of connect I would assume some But but yeah, some lab leaders are there Yeah. That I'm aware of. I have been informed that there are there are lab leaders there. Mhmm.
Speaker 2:You know, Sam and Greg have been all over the podcast circuit Sure. This week, so it's not them. But there are lab leaders there which which to me is funny because they hopefully aren't on X because it would be hard to be properly
Speaker 1:social media platform?
Speaker 2:Yes. Okay. You can imagine, you know, you're camped out in the desert. The whole purpose is to like do nothing and just, you know, whatever they do out there.
Speaker 1:Yeah.
Speaker 2:And then it'll be a little bit jarring, I think, coming back Oh, and seeing the updates.
Speaker 1:Yeah. Anyways If Burning Man wants to survive, I think that they should probably host it in New York, switch it up, invite only, maybe get Sorkin on stage interviewing CEO. Something a lot more like deal book Yeah. Would probably work for for, like, the future there. That would be something that I would wanna Yeah.
Speaker 2:And it would make the BlackRock connection make more sense.
Speaker 1:Exactly. Yeah. It was always a little you had to squint to understand why is BlackRock involved with Burning Man. But if they if they held it in Manhattan with just financial leaders, geopolitical leaders and it was just more like one on one conversations
Speaker 2:About global markets.
Speaker 1:With a with a legendary investigative journalist and a and a news anchor who everyone really respects. And it was invite only and then the videos could go out on the Internet. Like that might be a little bit more up my alley. Yeah. Yeah.
Speaker 1:If they want to appeal to me. I don't know. Don't know if they're going after me.
Speaker 2:I don't
Speaker 1:know if I'm in the dam. I don't know.
Speaker 2:Speaking of Sorkin Yeah. Sorkin Sorkin has an amazing quote from when Mark Walter bought the Dodgers.
Speaker 1:He said, mark my words. This man will be investigated by public No.
Speaker 2:He was just like he was basically saying like, to paraphrase, like, this is not all certainly not all of his money. Oh, interesting. There's some other bunch of people funding this that aren't just Yeah.
Speaker 1:And and I forget that how like it's so normal in venture. Like if if you're like, oh, yeah. I raised money from, you know, Sean McGuire at Sequoia. You're like, yeah. Well, that's Sequoia's money and that's not all his money.
Speaker 1:He probably has a stake in it that he invested but then also it's Sequoia's money and Sequoia's money is like the Harvard and Yale endowment money and and CalPERS and all these pension funds and like, you understand that there's this sequence of ownership that happens with a normal venture investment or even an acquisition. But in sports, like the final beneficial owner is really important. And I don't know if that's purely aesthetic because when you say this person owns this team, you want to know that they actually own it and they're not just the front man for like a private equity firm. But it's interesting that that Sorkin called that out. He is the best for a reason.
Speaker 1:Anyway, what's Ryan Harmon up to? He's cutting the number of calories in a new product called Hall Pass. Yep. One third the calories, one third the ad space, Hall Pass. This is from Peter Rahal.
Speaker 1:Correct? Yep. Very cool. So you know him from RxBar. You know him from David, the protein bar.
Speaker 2:Sorry. I wanted to Am I right? I wanted to include Sorkin's line Please. Before we move on. Please.
Speaker 2:He Sorkin said, and this is 2014. He says, they appear to be living out a childhood fantasy using other people's money, some of whom may not even realize it. Wow. And it took over a decade for the chickens to come home to roost Wow. On that one.
Speaker 1:Very very interesting.
Speaker 2:Anyway. He also called it a lawsuit waiting to happen. Anyways, back to advertising. Whole path. Yeah.
Speaker 2:Day Job and Medici, which is the parent company of of David and and now Hall Pass. They've just been cooking together. They had the the same team behind the the fish campaign, which I still we're still it was so odd that it's stuck in your mind. Yeah. I've
Speaker 1:gone back and forth on did they ever actually sell boiled cod?
Speaker 2:Yeah. Did. They did.
Speaker 3:They did.
Speaker 2:They it.
Speaker 1:But they didn't but it's not like an actual SKU.
Speaker 2:It was a SKU for a period of time.
Speaker 1:Oh, for a period
Speaker 2:of time.
Speaker 1:But it was like a special launch, special drop. There there
Speaker 2:See if you can still
Speaker 1:get They're not in the business. Because there is a business there. Like, people people do buy boiled cod. I
Speaker 2:don't know. They still have canned cod for sale on the website.
Speaker 1:Maybe it'll be the biggest skew ever.
Speaker 2:Wild cod Atlantic cod.
Speaker 1:Yeah. It happens. Okay. Let me tell you about console. Please.
Speaker 1:Console builds AI agents that automate 70% of ITHR and finance support giving employees instant resolution for access requests and password resets. Now The great Dyson. The great Dyson debate. TJ Parker kicked it off. He said apparently unpopular opinion.
Speaker 1:Dyson products are generally not very good. David Senra. Someone needs to check-in on him. But strongly agree, though my girls love their air wraps, says Bryce Roberts. A couple other people saying, yep, my wife got a vacuum.
Speaker 1:It was terrible. Felt like a total psyop. A lot of people are upset. The Matic founder's chiming in. I got got an alternative for you.
Speaker 2:Woah. He's saying that it's likely ruining your rug slash carpet.
Speaker 1:Oh, interesting. Dyson rug shed and Dyson suction is very adept at making it shed faster than necessary. Interesting.
Speaker 2:Okay. Okay. I'll start with what I I I think the Dyson business is incredible. The story is incredible. I think that the making things that look like halo weapons for
Speaker 1:Oh, yeah. Stuff around the home That
Speaker 2:is a is a very cool way to differentiate. Mhmm. And I appreciate the over engineering, like, everyday objects. I I'm I'm not saying I'm buying into it, but I'm but I appreciate that that someone's doing it. Somebody needs to make a $500 toothbrush.
Speaker 1:Okay.
Speaker 2:But that being said, I I saw this and I was like, you know what? That kind of I I that does resonate because every time I have a Dyson vacuum at home and I've had various Dyson products over the year, and the vacuum in particular, it just feels like a little bit like creek like it's like creaky. It feels a little bit it feels a little bit cheap. Yeah. And I always want to put it away because I don't like this like halo weapon, know, a home cleaning device doesn't exactly fit in to the overall design
Speaker 1:say you don't live at the city. Say your house doesn't look like it would be welcoming to the flood. Come on. You gotta you gotta design your whole house to fit the aesthetic.
Speaker 2:Yeah. You
Speaker 1:That's gotta have a banshee upfront.
Speaker 2:A banshee upfront Would be would fix me.
Speaker 1:Yeah. I think you forget how bad it was before Dyson.
Speaker 2:Yeah.
Speaker 1:Was so bad. Vacuums were so rattly and clanky and like they used to have bags on the back that you would have to like take out and they have this felt inside and the stuff would be going everywhere. Like, this is such a step forward. Maybe you could say that, like, it's plasticky and and it doesn't feel, like, super rock solidly built now, but it moved the whole category so far forward and so far into the future. Just the fact that you don't have to plug it in.
Speaker 1:It has a battery. That was an innovation. Like, there most most most vacuums, you would have to take it out and then you would unwind this long cable. And they I think they still make some of these, but you would have to find the low the the nearest plug, plug the vacuum in, and then you could only vacuum as far as the cable would go. And then you'd want to move to another room.
Speaker 1:So one of my early like chores I think I I don't know why I have so many remnants of this but I guess I I vacuumed. I have I have
Speaker 2:formative memories of like Vacuuming. Trying to get to a spot.
Speaker 1:And you're like oh, and you're trying to extend it and then you have to
Speaker 2:like And as a kid, you're trying
Speaker 1:to be as efficient as possible. Yeah. Course, don't want move the cord in two seconds.
Speaker 2:There's four plugs in the house that need to hit Yep. To vacuum the And whole
Speaker 1:so you got to you got to optimally It's a traveling sales problem all of a sudden. It's NPR. Like, you gotta plug in over here, reach under there, get under the couch, go over there, then you gotta move the cord over the couch so you can get to the other side. Then you gotta move the cable all the way to the other side of the room so you can get the other side of the room. Huge problem.
Speaker 1:Completely solved. One shotted by James Dyson. One of the greatest to ever do it. And put some respect on his name. Apologize.
Speaker 2:I I I still think they should make a line that that doesn't feel as cheap.
Speaker 1:Yeah. I don't know. There would
Speaker 2:there would almost certainly be zero demand for it. Yeah. But I think that if you're willing to make the $499 toothbrush, you should be willing to make the $5,000.
Speaker 1:Maybe. Hold I feel like you'd lose a lot in the engineering. Like, you would wind up doing I mean, because as soon as you go metal, you're going to get a lot heavier. It's going to be a lot more annoying. I do think that part of the problem that you're feeling is that the products have gotten more complex.
Speaker 1:There's one that has a laser beam on it that shows you the dirt that's somewhat useful, but it's not that relevant. And so there's they've added a lot of weight to them and I think that puts a little more strain on the device and the engineering and so but I don't know. Would carbon fiber satisfy you?
Speaker 2:Yes.
Speaker 1:Okay. The carbon fiber Dyson vacuum. Anyway, there's an article in the journal
Speaker 2:with somewhat niche, but one of the I would call it the post of the day. David Senra interviewing Herbert Hoover. Hoover, I effing love it. You have to effing meet James Dyson.
Speaker 1:Yeah. I I wonder what percentage of the David Senra of David Senra episodes include a mention of James Dyson. It it's gotta be it's gotta be above 50 for sure. Yeah. We talked about this a little bit earlier, but James Dyson sold us a $400 hair dryer.
Speaker 1:Now he's trying a $500 toothbrush. The inventor known for household appliances is turning to oral care. Quote, we don't really structure things on a business plan. I mean, you brush your teeth so much over the course of years. If this lasts a couple years, I wouldn't be surprised if the Dyson camera jet toothbrush sells pretty well.
Speaker 1:Also, just physical objects, things like this, they kinda fit with Christmas. I feel like there's less and less things to to give to people. It feels it feels nice and and luxurious and special, and it's a new gadget. And even if you churn from some of the features, it remains a daily driver. It's not gonna collect dust in the way that some Internet connected gadgets do, even if you don't get a lot of value out out of the the imaging features.
Speaker 1:But I don't know. We'll see where it goes. We'll have to check-in. What is going on with the Cybercab? Cybercab Let's
Speaker 2:check out the interior.
Speaker 1:Is there's an interior tour here with whole Mars catalog. And I b says
Speaker 2:The doors go up, John. The doors go Did you know the doors go up?
Speaker 1:Yes. I saw that. This will completely replace Uber for me. Holy mackerel. I like this.
Speaker 1:There's a couple other data points about the Cybercab rollout. So famously, YouTuber and electronics reviewer, Marques Brownlee, attended the previous Cybercab event and came away impressed and optimistic about the future of self driving but skeptical of the timeline. And he said that if Elon could make good on his forecast, which was for sale by the end of twenty twenty six for under $30,000, no steering wheel, full self driving, you can just put it out in the world and it will go do tasks and earn you money. That was the pitch. And Marquez said, I think that's too aggressive.
Speaker 2:Does for sale mean they're being delivered?
Speaker 1:Yes.
Speaker 2:Okay.
Speaker 1:For sale
Speaker 2:Because they did throw up like
Speaker 1:Pre a order doesn't count. Okay. You gotta pay the 30,000. You gotta get the Cybercab by December 31. And so if you get took that personally.
Speaker 1:Elon took that personally. Yeah. He has a pre order where you can buy a whole stack of them for for a million dollars and run a fleet. But I think Marquez is looking good. The the stakes were high.
Speaker 1:Marquez Brownlee said that he would have to he would shave his head if this happened on Elon's original schedule. And of course, every time a every time there was a Cybercab that was spotted I actually saw one here in LA. Every time there was an update about the progress of the Cybercab program, people would respond with a AI image of bald Marquez, is very funny. But the
Speaker 2:Should we be making predictions with with head shaving as a as a con Yeah. Yeah. Yeah.
Speaker 1:If Elon doesn't ship this by the end of the year, I'll shave Tyler's head. I'm willing to do that. If Elon doesn't
Speaker 2:Okay. Is that do we have a deal? Yeah. Wait. If he doesn't ship
Speaker 1:it? If he doesn't ship the Cybercab for under $30,000 by the end of the year
Speaker 2:Actual deliveries
Speaker 1:No steering
Speaker 2:wheel and or driving vehicles that can do economically viable I'm inverse Marquez Bradley.
Speaker 1:No. No. Yeah. Yeah. Yeah.
Speaker 2:Yeah. Oh.
Speaker 1:No. No. Yeah. Yeah. Yeah.
Speaker 1:If he doesn't do it. Yeah. You're the opposite of of of Marquez. If he doesn't do it, you shave. If in the in the the world where he does do it, then you don't have to shave your head.
Speaker 1:No. I do like the head shaving as a as a bat. I don't know exactly
Speaker 2:When's the last time you had a buzz cut?
Speaker 1:High school. Football season. I would shave it before the season started. Easier to put on the helmet. And then I would grow it out all year and I had long flowing hair.
Speaker 2:I Electric. Will pay a lot of money for pictures of John
Speaker 1:find an old one. It was it was a good it was a it was a wild luck. It was a lot of fun. It was also just like easier. Lazy.
Speaker 1:Lazy bones. Not today. Not today in the life of a broadcaster. Quickly. Ready to fire up Astra?
Speaker 1:Do it on Codex. Codex is a powerful workspace for getting work done with AI agents, whether you're writing code, analyzing data, creating content, or automating business workflows. Codex helps you move projects forward from start to finish. I'm actually really bullish on the Cybercab. I've tested Model s recently and I ordered a Model y l.
Speaker 1:And the self driving capability is 100% ready to rock. Like, it it is, you know, Brandon and our team were saying that he's at 95% of the miles that he's driven in the car have been in full self driving mode. You had a little bit of tele op for that 5% that's not there. And with a cab, you don't have to negotiate driveways and drop off points and valets as much. Yeah.
Speaker 1:It's solved. Like, truly, the only time you're driving a Tesla, if you have the full self driving on the latest hardware, is you pulling into your garage or negotiating a parking lot, something like that. Interestingly, Tesla has a feature, smart summon. It can pull out of a of a parking space and come and pick you up. It's a little janky right now, not quite there.
Speaker 1:You have to sort of puppeteer it yourself. But they don't have a banish mode and there's huge demand for banish, which is the inverse of summon. And Brandon just coined this and I was like, that's actually great. I and he was like, yeah, that's probably what they'll call it. And I was like, yeah, guess, but I wouldn't have thought of that.
Speaker 1:I don't know.
Speaker 2:Seems like a very Elon Yeah. Word.
Speaker 1:So I love the idea of being able to take the full self driving vehicle, get out of it just on the curb, actually at your destination and say banish. Go pay for parking if you wanna pay for parking. Go find a spot on the road. Go drive around until you find something. I'm gonna be here for an hour.
Speaker 1:Deal with it. Deal with it, AI. You know? Like, that's what I that's what everyone wants. Yeah.
Speaker 1:For sure. For sure. Anyway. What did Elon actually say about Cybercab? He said 20¢ a mile to run 30 or 40 with taxes.
Speaker 1:And yes, you can buy one for under $30,000 Get ready to shave your head, MKBHD. Somebody is shaving their head. It's either Tyler or MKBHD. We'll see. I think the cost of autonomous transport will be so low that you can think of it like individualized mass transit.
Speaker 1:The average cost of a city bus per mile, not the ticket price, because that is subsidized, is about a dollar a mile. The operating cost of a Cybercab will be around 20¢ a mile, including taxes and everything else, probably 30 or 40¢ a mile. Yes, you'll be able to buy one. We expect a cost below 30,000. It is crazy that I'm in a world where I think they're going to ship Cybercab before Roadster.
Speaker 1:Cause they announced Roadster a decade ago.
Speaker 2:I know. But we were expecting something around the Roadster in August.
Speaker 1:Right. Yeah. Flying. He and and he told Rogan he was he was gonna show a demo that was gonna blow everyone's mind.
Speaker 2:Yeah. So I would expect that hopefully this month.
Speaker 1:So you think you think you'll be able to buy a Roadster and get it delivered before you'll be able to buy a Cybercab and get it delivered?
Speaker 2:I never said I thought you could ever get a Roadster delivered.
Speaker 1:You just think it's never gonna come?
Speaker 2:No. No. No. But but I would assume if they're gonna do a demo
Speaker 1:Yeah.
Speaker 2:Then we're still over a year out
Speaker 1:Yeah. From delivery Yeah. At least. I mean, just from a financial position, Cybercab makes so much more sense as a business than Roadster. Roadster, I mean, even at $250,000 for the crazy specs, it's still like there aren't that many buyers that want that.
Speaker 1:A lot of people that are spending $250,000, they want a manual, they want an experience, they want a weekender. They don't necessarily There's want so
Speaker 2:many buyers for the Roadster There will be. At least where we are.
Speaker 1:There will be. But we're talking about so many buyers, oh, 10,000 cars a year or something. It's not the way people get around Yeah. Every day like taxis. You know?
Speaker 1:Like, it's just completely different TAM, completely different situation in general. So I don't know. I I might go well, I I'm shaving this side of the head if it's Cybercab first, this side of the head if it's Roadster first, and I think I'll have a head of hair for over a year.
Speaker 2:Oh, I thought you were talking still about time.
Speaker 1:Oh, yeah. Yeah. Yeah. No. We'll we'll we'll do something.
Speaker 1:There there's other there's other Cybercab videos. They're very fun. Go check them out. Tested Cybercab without a steering wheel or pedals drove us for thirty minutes on a pretty busy Thursday night in Austin, Texas. The 4.7 mile ride cost $9.62 starting tomorrow at 5PM.
Speaker 1:Anyone in Austin can hail a Cybercap for themselves. Nothing can compare to this. Well, I mean, can compare Waymo to it, but I I guess it's it's it's good that it's rolling out and we are entering the duopoly phase of of full self driving
Speaker 2:Cybercabs. In the California Post
Speaker 1:Yes.
Speaker 2:We were gonna do the mansion section this week as we do, but unfortunately We'll come back. There is a mansion shortage Okay. In San Francisco. AI is minting a new class of millionaires in SF and they're running out of mansions to buy a wave of wealth tied to the city's booming AI industry, sending home prices soaring, triggering bidding wars with as many as 50 offers and leaving even buyers armed with 25,000,000 in cash out in the cold.
Speaker 1:Woah.
Speaker 2:Frenzy marks a stunning turnaround for a city whose housing market slumped during the pandemic as tech workers scattered and offices emptied. Mhmm. Now AI companies are rapidly expanding, employees are returning to their desks, and startups are generating enormous paper wealth for workers and investors with potentially even larger windfalls ahead. I looked on Compass Mhmm. There are only 14 homes in SF on Compass over 10,000,000.
Speaker 2:And some of them are like duplicates Yeah. Some aren't even like Mhmm. Some aren't single family homes. You just
Speaker 1:have to be bullish on on places that are further away from actual San Francisco. Like you look at what happened with Mill Valley and you have to imagine that with self driving, one a one hour commute to a man's
Speaker 2:And Chinese quad copter drones
Speaker 1:And for robotic horses. Don't forget about those. There's just going to be more tolerance for a longer commute that where if your commute is you're fully on your laptop, basically. Or you're or you're basically talking to your AI agent. And yeah, maybe you're ready to take over once a month briefly, but 99% of your miles on your commute.
Speaker 1:Yes, you have an hour commute, which sounds ridiculous when you're living in a mansion, but you're you're being very productive catching up on all your emails, really going back with all your coworkers, hopping on phone
Speaker 2:calls Yeah. Hopping on a Zoom saying nothing from my end.
Speaker 1:It's going to be electric. The future is here. This changes everything. Well, our next guest our first guest is Hunter Somerville from Stepstown Group. He's part of you there.
Speaker 1:He has his first appearance on the show, so we'll bring him in to this evening in Ultradome. What's going on? Hunter, how are doing?
Speaker 4:Great. How are you guys?
Speaker 1:We're doing Happy early Labor Labor
Speaker 2:Day or or or holidays three day weekends in general have actually been a key part of understanding the AI cycle Yeah. Because when people get a holiday weekend, they have a little bit more time to actually like try some of the new tools. And we've actually seen these like longer weekends catalyze Adoption. Adoption. Just like understanding.
Speaker 2:Yeah. Understanding.
Speaker 1:But let's start by trying to understand your career. It's your first time on the show. I would love to kick it off with a little bit of introduction on yourself and Stepdunk.
Speaker 4:Happy to. Thank you. So I'm a Baltimore guy, born and raised. Plenty of mansions in Baltimore for anyone who's looking on the venture side. That's right.
Speaker 4:Just putting that pitch out there. There
Speaker 1:you go.
Speaker 4:And I was a partner at Greenspring Associates, which Stepstone acquired about five and a half years ago. And now I'm one of the co heads of the Venture and Growth Equity Group under Stepstone. Stepstone is a publicly traded company. It has different asset class teams across real estate, PE, and venture. I only do venture and growth equity within the organization.
Speaker 4:Mhmm. And our group does fund, direct, and secondary investing, so we mix all three together, which is a pretty unique Yeah. Position to be in. We back who we think are some of the most interesting early stage GPs out there that invest its seed in Series A, and then we come in and invest in companies at BCD rounds, either through primary or secondary purchases after the fact. We leverage the ecosystem and the relationships to then identify the companies we want to build concentration in.
Speaker 1:What is the Venn diagram of look through exposure via your fund investments and your primary and secondary your growth equity and your secondaries business? Because I imagine that there's already some sort of relationship. The company has been scouted. There's a growing relationship and then you're ready to do a direct or a secondary transaction. Is that usually how it plays out?
Speaker 4:You've completely nailed it. That's exactly right. We work with over 300 venture and growth managers, which probably feels like a lot. But it's great from an ecosystem standpoint because when we're looking at a company, we have three, four, five different managers Mhmm. Already as part of that syndicate that are sitting around the board table that are actively working with the founders and gives us tremendous insight on those businesses that we would like to do more with and invest directly into.
Speaker 1:Yeah.
Speaker 4:If you segment our business, it's about fiftyfifty between direct and fund investing. And secondary is a little more complicated because that includes both fund and direct secondaries that we do where we provide liquidity to people within the cap table of a business or we provide liquidity to endowments, foundations, pension funds, whoever else may want to sell LP interests that they hold in funds.
Speaker 1:Got it. Yeah.
Speaker 2:Please. I'm very interested how new managers are, on the fund side are are pitching you today. Like, they're coming in. It feels like we are in some cases, feels like we're a decade into this cycle. Right?
Speaker 2:A lot of the big liquidity events of this last year have start have been from companies that started before anyone was brought, like people broadly were were thinking and debating and and investing in AI. A lot of people have been rewarded for backing, you know, I'm thinking of, you know, chip companies like Cerebras Yeah. That, you know, backing those companies in the 20 tens. You've been you've been doing well. But what are the new managers that are maybe coming off of building companies or operating?
Speaker 2:What what's their pitch to you around like the next five to ten years? Because you're you're betting on at the early stage, you're betting that there's gonna be a bunch of big new companies created.
Speaker 4:I would say just first and foremost, it's a harder fundraising environment for new managers that are getting off of the ground. The LP capital continues to concentrate more heavily around the multibillion dollar brands that are increasingly adding strategies or other parts of their platform. Getting LP attention, I think, is tougher. If you layer that on top of the fact that a lot of seed rounds are being bypassed and going straight to larger A rounds or just larger seed rounds in general, it's harder for emerging managers to even play in a lot of those situations because most emerging managers are focused on seed or small a and are operating out of fund sizes of thirty to three hundred million. So they're not exactly going to be leading a seed round in a $100,000,000 kind of financing overall.
Speaker 4:So they need to prove their right to exist, I'd say, even more than they ever have historically. You could argue maybe that's a little bit different in hard tech and deep tech where I do think there's a bifurcation in terms of viability and where you can be an active participant, get good ownership in business like that, and then you get blessed later by the multibillion dollar brands. But in AI specific focused companies, I think seed is harder. You really need to find a way to stand out. You need to prove your ability to source or build relationships with founders very early.
Speaker 4:And certainly, if you're an operator and you come from a company where there's a diaspora of talent and proven founders and a culture that fosters that, you can make the case you're creating a new mafia that you're better suited to back than someone else that already exists. On top of that, AI founders are generally younger. GPs also increasingly have an advantage if they're younger and can relate better with that founder cohort. I think there's an argument to be made in that regard as well.
Speaker 2:Yeah. It felt like, rewind, five years and every
Speaker 1:it
Speaker 2:felt like half the people I knew were raising for at least like a a micro solo GP fund and it and it didn't it seemed like, you know, it seemed like if you wanted to raise 5 to 10,000,000, it was like very easy, you know. You did have to like do the rounds and maybe it took six months whereas but you were gonna be able to pull the money together if you were competent and you had any kind of track record. And it and the interesting dynamic is like back then, there wasn't this crazy new technology cycle. Like the the craziness in the market was a function of interest rates. And so the companies that were growing incredibly quickly were a company that was like a lending business and like they just had a bit of an arbitrage.
Speaker 2:Right? Whereas today, you have it's interesting because it seems way harder for new managers to get off the ground and even pull together, you know, the $50,000,000 fund. And yet, it actually feels like a much better time to be investing because of the the sort of like turmoil of the technology markets right now creating opportunities for new entrants.
Speaker 4:Yeah. I totally agree. And I I would say it's still not that hard to raise a 5 to $10,000,000 fund. If you have any kind of network, you can cobble that together with friends and family or people that you've worked with or new minted millionaires that are out there in the ecosystem. But if you really are going to cross the chasm to being more of like a $50,000,000 plus seed fund, you do need to bring in institutional capital from endowments, pensions, fund to funds, or that kind of ilk, and getting their attention is much harder.
Speaker 4:And some high net worth capital can be rather fickle where they will come in at less obvious times and not be as consistent with continuing to re op into those managers or consistent with doing new managers. I think the opportunity set couldn't be more exciting across all of the categories that I just mentioned, deep tech, hard tech, AI, whatever it may be. But I do think it's harder to get attention from the bigger allocators that allow you to do more proactively. And I think if you're a 5,000,000 to $10,000,000 fund, you're getting really de minimis ownership and you're going to have no ability to follow on and no ability to concentrate behind your winners and just a more problematic portfolio construction math to navigate.
Speaker 2:Sure. How are you how are you managing all your direct opportunities? And specifically, wanna understand how you're evaluating these things when you see a company. Maybe you saw a company at the beginning of the year, you have an opportunity to go to direct. Now, later, they're raising it three, four times that.
Speaker 2:Maybe they've they've three or four times revenue, but these revenue multiples are still So it it it has been the right decision to invest in almost everything, it feels like, at least so far from a markup standpoint. But we know from history that that in the past, it's felt like the right decision to invest in everything until until it's not. And and the quality names, right, will still They might have to do a down round and then grow back into Mhmm. Into that historical valuation. But then we know that there's just hundreds of companies that get left to basically to die.
Speaker 2:Mhmm. And it didn't really matter where you invested even if it had a bunch of momentum. So how are you Like, what are you telling your managers that are bringing you opportunities or the companies that you're already in to go direct or through SPV opportunities?
Speaker 4:Yeah. I mean, it's like everyone forgot the 2021, 2022 time frame where they were left with a bunch of companies that were way overvalued. They took discretionary markdowns of 25% to 50% off of last round. Books were completely underwater. I mean, you certainly could argue, and rightfully so, this is a much different, more exciting innovation cycle, but it doesn't take away the responsibility to know when you should be layering in aggressively and when you should be doing maybe pro rata or below pro rata or nothing.
Speaker 4:And I think what people will ultimately be judged on with a lot of these rounds is how aggressively they built their largest part of their positions early and the follow on rounds get scrutinized much more. And that's how we would ask our investors to evaluate us too. If you're coming in with, you know, 80% of your capital in that last crossover round that maybe the company goes public at or below that or you're not even making a 2x return off of it even if duration is shorter or things change cyclically and you're left, you know, having to take a discretionary markdown and have a a TBPI on a net basis below one because of that, that is the kind of optical look that does not age well and people need to be cognizant of that overall. That being said, follow on activity is just through the roof. I can't remember in August this busy with all of the top sort of value driving companies out there raising money even at the end of the summer.
Speaker 4:I guess it's intuitive with the expectation that IPO activity will be much more robust in the fourth quarter, but it's still crazy busy to your point around the amount of financing rounds that we're seeing right now.
Speaker 1:Yeah. Totally. What are you seeing on the spread of fee structures for early managers with the k shape? You know, we've seen reporting of funds charging not the traditional two and twenty, but you see four and forty, I think, in the most extreme case. And then you also see early managers giving on fees.
Speaker 1:How wide is the spread? Is it widening? Is there is there a k shape in fees where the next generation of managers are making zero zero? Just doing it for the love of the game?
Speaker 4:The the most egregious part of the entire continuum, I think, is SPVs and what people are doing on SPVs. Even separate from the funds, it's the insane, like, four to 10% management fees that people are charging and syndicating out to the long tail of investors that are out there. I mean, it's almost criminal how bad it is in terms of how some of these SPVs are being structured, then they're opaque. They're multilayers. People didn't even know what shares they own underneath of it.
Speaker 4:And so, I think that that is the worst part where there will be a reckoning and lessons learned, and I think it's well overdue. When it comes to funds, you know, there is adverse selection on fee concessions, and I don't think you see that from high quality groups in venture. The spinouts that are the most interesting with the most pedigreed people or the best operators never have to concede in that regard.
Speaker 1:Mhmm.
Speaker 4:They can still raise quickly. There are certainly contrarian ideas where that may make sense, but our mentality as a partner is to not crush people on fee negotiation, you know, as long as it's within a reasonable range.
Speaker 1:Yeah.
Speaker 4:We'd rather make sure we build a robust partnership where we can do stuff more collaboratively on direct and secondary than on fighting hand to hand combat on fees overall. And I think when it comes to the carried interest piece, it's all about it being aligned and performance based. Use escalators. Make it predicated on hitting certain return thresholds, hopefully not a 2x, which anyone should do in venture in terms of what you're looking for return wise, but 3x, 5x. Even when someone puts a 10x threshold in, we love that dynamic because we know they're going to try to nuke it and really shoot for the alpha and upside that venture should provide for people that are willing to allocate that risk capital.
Speaker 1:I I have one more on this.
Speaker 2:Go for it.
Speaker 1:Can we stay with the humble SPV hustler? They got Miami penthouses to pay for. But I'm interested. We've had Matt Grimm on the show. He's talked about all the whack a mole he's been playing with Andoril secondary activity and shares falling in the wrong hands.
Speaker 1:What else are you seeing in the secondary market? And particularly for founders, what steps should they be taking early on to avoid the cap table getting super complex and muddy over time? Or is this just the inevitable new normal?
Speaker 4:I mean, sometimes at the beginning, you have to scrape things together and do what you need to do to get things going. But from a secondary standpoint, like, there is a point in the trajectory of a business where you begin consolidating that cap table. Sure. And that's what we look to do as a We secondary go in, we build a relationship with the founder, and we try to be a helpful partner and let them lead us to who they would like to provide liquidity to, who's well suited for that, who might not make sense to continue on the journey, who's already made a great return at seed and maybe should liquidate at that point in time. You need to put the power of the decision making in the founders' hands and let them guide you in the direction of where you should be buying from.
Speaker 4:I think it's terrible practice for people to go out and cold call on LinkedIn or bother employees and try to create disruption within a company artificially and then hope that a board blesses it end of day. It's all on hopes and dreams of that happening. If you actually work hand in hand with the founders directly, they can be your Sherpa and guide to the right people you should be buying from in the first place. When it comes to SPVs and syndication, yes, smaller funds who can't do their pro rata will likely SPV at some point, but it becomes unwieldy, confusing, and complicated. Then there are multiple layers on SPVs as these companies become better well known and bigger and later stage, that needs to be cracked down on over time.
Speaker 4:You just lose complete control. Frankly, you're not even bringing in the right people into the rounds all of the time because every insider is then taking a huge percentage and syndicating it out more aggressively. You need to think of when the right time is to stop that or to be more selective and narrow around it, but you can't not have an opinion on it or not manage it with a firm hand and understand who your beneficial owners are end of day. It's just not helpful. And then your information is getting out to everyone without your control as well, which which doesn't always make sense.
Speaker 2:Yeah. Can you talk about the the power law in the in the secondary market? Like I you have to imagine that like OpenAI, Anthropic, Anderol, Stripe, Neuralink, Databricks, like, you have to imagine just like a handful of those names account for like 90 I would guess like 95% of the volume. But does that does that track in your experience? And then how much activity is actually happening in the in the long tail of names outside of like shares trading hands, like when financings are happening and and like little tender offers here and there.
Speaker 4:Yeah. I mean, it is broadening significantly, but all of the discussion is still on those top names. And, you know, you need to be in the top names in venture, particularly as a late stage investor, but you need to be in them when it's not overtly obvious and when you're building those positions aggressively upfront before it becomes massively confusing and overly syndicated. But I think every company is realizing the value of being thoughtful in terms of offering liquidity as an option to tenured employees within a business on an annual basis, a semiannual basis. You decide who is the right level of tenure within your company and it almost becomes like a benefit within a company like anything else where they know that their shares are worth something.
Speaker 4:It's not so amorphous. You can go home and tell your spouse or significant other that this is not all paper gains. It's not going to immediately evaporate. We can realize part of our position. We can utilize that capital to live our lives and do what we need to do.
Speaker 4:We can ride the other 80% because we believe in the mission and the company that we work at more aggressively. It creates more aligned employees and I think people have realized that and there is certainly a more active buyer universe to provide that. But it requires that companies are thoughtful. They think about it not at the very beginning where it's almost absurd to be offering secondary liquidity or taking it. You need to have proof points.
Speaker 4:You need to get it to a stage and size that's relevant. But then it does become a very interesting recurring benefit to offer your employee base with strict control led by the founders.
Speaker 1:Yeah. How is the global pool of capital changing and its appetite for venture? I'm just thinking about there was a moment when, you know, Sequoia had a Chinese arm. They obviously separated. There's a conflict in The Middle East.
Speaker 1:There was a long time when there was a stage, I'm thinking of like the Uber era where it was like, oh, like The Middle East shows up with a big pocketbook but now there's a there's obviously geopolitical conflict there. There's protectionism, tariffs, all sorts of different dynamics. What are you seeing on the global stage of capital allocation towards venture? Because it's certainly not showing up in the headline prices, but I would expect some sort of move here. But how are you puzzling all that together?
Speaker 4:It's actually still pretty robust, but it's concentrated among a smaller subset of managers. And that's sort of natural because a lot of the international check writers are going to be writing larger checks. And so they're not going to be able to come in and do sub $200,000,000 seed managers Mhmm. Or they're not going to be staffed to be able to do it or the proximity of what's required to do diligence and build relationships and build pattern recognition is just naturally more difficult. I think another way to approach it, I think there are great branded managers that are bigger that are very much worth doing and should be a ballast in any venture portfolio.
Speaker 4:But you can also supplement that by working with a partner on a separate account basis and build customized exposure in smaller managers on top of that and almost barbell it in both ways where you get the core exposure with the managers that have the halo effect and the ability to get into the best companies early. Then you also get that alpha exposure from the smaller end in a more customized way that fits the needs of a team that's maybe more remote or further away. There are creative solutions to do it, but I would say it's still much more weighted towards the bigger brands that are more proven and derisked when it comes to how people are thinking about allocation decisions.
Speaker 2:What's the what's the what are the upsides and downsides of being in this business from Baltimore versus living, you know, in in SF? I can I can imagine I can imagine a lot of a lot of, honestly, alpha and, you know, you you and being able to actually understanding like diffusion?
Speaker 1:Yeah. Like the real world.
Speaker 2:But but what what's your view?
Speaker 4:Yeah. We have parts of our team in California, in San Diego, in Palo Alto, in New York, in London. Biggest part is actually still in Baltimore, which does seem counterintuitive. We like it that way. I I think our culture is predicated on grit and grind.
Speaker 4:Behind me, I have a bunch of Cal Ripken merchandise, the Ironman, and that's sort of how we think. Go to work every day. Work your ass off. Crush it, don't be complacent, and don't get caught in the echo chamber. This is a cyclical asset class.
Speaker 4:It's a cyclical business. It's easy to get caught up in euphoria all of the time and feel like momentum is never going to stop. I think being in Baltimore where things are tough and not always easy and there's challenges beyond what we do on a day to day basis grounds us. When it comes to difficulties, you know, I'm on a plane four days a week going all over the country or internationally to meet with founders, to meet with funds, to meet with our investor base. And so, it creates sacrifice, but I mean we're blessed to be in this business.
Speaker 4:There's nothing I would rather be doing to back innovative founders taking risk, embracing the American dream, going hard at things and to be able to do it, you know, still in a small blue collar environment like Baltimore is pretty special.
Speaker 1:Love it. Have I have two more questions. I'll I'll leave time for you, Jordy. But one, the liquidity wave. There were a ton of breathless articles about the wave of liquidity coming to early stage managers, late stage managers across SpaceX, OpenAI, Anthropic.
Speaker 1:Some big IPOs coming. How real is that? How significant is that? I mean, SpaceX is a $2,000,000,000,000 company. It's holding.
Speaker 1:You mentioned the IPO window potentially continuing to be open. But how much does that actually change the calculus of what you do and others in the category do?
Speaker 4:Yeah. Awesome question. And we haven't talked about that yet. So The biggest issue, I think, with venture is duration. It takes forever to go from seed to eventual exit.
Speaker 4:Yeah. The bar to go public is 500,000,000 or whatever people think these days on the banker side, 400,000,000, 500,000,000 of top line. AI businesses are obviously growing faster than anything we've ever seen, but the duration is still long. Yeah. And you need to be able to distribute capital back to investors in order to get them to invest in your next funder.
Speaker 4:That cycle is not sustainable overall. And so, people have been waiting four or five years for liquidity. DPI has been in short supply. Mhmm. And it does feel like that is changing both with M and A.
Speaker 4:We saw Hugging Face, obviously. Yeah. Most recently, we saw the SpaceX IPO.
Speaker 1:Reversive a
Speaker 4:bunch of other IPOs happening in the fourth quarter and hopefully into the first half of next year, which would be awesome. Yeah. And so hope that continues. But you're you're right. It it's actually an interesting thing to think about on the secondary side because if there's a massive kind of environment around liquidity generation, I would say that is a negative for the secondary side, but not a huge one overall because there's still what we described before where people are going to offer tender offers on an annual basis, start putting that in place ahead of time Mhmm.
Speaker 4:And creating an environment where that's iterative over time. And for our asset class and the endurance and long term viability of it, I welcome a lot of capital coming back to all of the hardworking pensions and endowments, and that'll give them a lot more flexibility to be able to invest in new funds, new innovation, continue and start to do more on the emerging manager side again, and broaden out holistically what they're considering within venture. I'd say it's a double edged sword, but but we'll we'll root for liquidity anyway.
Speaker 1:Yeah. Yeah. Yeah. That makes sense.
Speaker 2:You have one more?
Speaker 1:I have
Speaker 2:I have one more. Yeah. Go for it.
Speaker 1:I'm interested in how much you think thematically. Obviously, AI is driving headlines every single day but there's these interesting knock on effects of deeper in the supply chain, energy, hard tech you mentioned, but also there's some excitement among early stage managers that we talk to for the coming potential of AI to accelerate biotechnology. And so maybe that looks like writing more checks into biotech companies. Maybe the bio VCs, the flagship pioneerings do better, but maybe there's more crossover from the traditional tech investors that dabbled in crypto and did some hard tech and then also do AI. Maybe they will figure out bio.
Speaker 1:But how do you think about guardrails either at the manager side or at your level of there's a way of coming, when do we need to start paddling?
Speaker 4:Yeah. No. Totally. And all of our partners focus on different areas when it comes to the direct investment side. We're not like a traditional VC firm because the GPs are the core of what we do and so they lead us in the direction of where we want to go.
Speaker 4:But then we develop thematic points of view. Me, personally, I've covered more of the hard tech, deep tech categories that you're alluding to. I like those businesses. It's probably because I'm more old school and appreciate a moat and a multiyear advantage. I think a bunch of those areas you mentioned, energy specifically, mining, anything touching rare earths, refining, production of magnets, around defense, specific areas around aerospace that SpaceX may not be competitive in.
Speaker 4:All of those are places where I've liked to spend more time and I feel more comfortable. It feeds into the fun side of things because I also cover a lot of the smaller emerging managers that are doing it in deep tech and hard tech. You get the recognition of what's working at a seed level before it's overtly obvious to the rest of the market, And then you can build those relationships on the primary and secondary side more proactively. And unlike some of these massive seed and Series A AI rounds, it doesn't happen that way and as quickly and linearly in deep tech and hard tech. The seed investors can invest in one or two rounds and then people realize it's technically de risked.
Speaker 4:It's crossed the chasm. It's interesting. And then you will have very large check writers blessing that and doing really meaningful meaningful check sizes at that point in time. There are other bites at the apple that are more attainable than a really hot AI company at the very beginning. Don't get me wrong.
Speaker 4:We love both. I have other partners that are equally active on that side. The key is blending it and not making sure you're doing too much of one thing and that you're being thoughtful and bobbing and weaving accordingly. Biotech is a weird category, I would say, overall. I think over the past few years where it's been most interesting is on the crossover side because there's an ability to become pretty aggressive, almost predatory at the very late stages of some of these businesses overall and get good value or put structure in place.
Speaker 4:You've also had the ability to go public earlier and more aggressively in those categories. It's created a weird dichotomy where it actually made sense for crossovers to dip down and be more aggressive. And you've not seen the same level of new fund formation in biotech as you've seen in all of these other categories that we've discussed today.
Speaker 1:It. Wait. Wait.
Speaker 4:So really quickly, crossover, you
Speaker 1:you mean public markets hedge funds doing private placements early stage biotechnology companies that are going through FDA approval and will ultimately IPO, not a software VC crossing over into biotech, which is also going to happen, but separate things.
Speaker 4:Got it. You nailed that. Exactly. It's that type, even mutual funds Yeah. That I was alluding to.
Speaker 4:But to your second point, we are now seeing sort of the formation of dedicated specialists in tech bio Yeah. That are more typically coming from the tech side probably rightfully so. Although any good cap table that does tech bio probably needs to mix the two together where you have more of the traditional old school biotech managers and then also the very forward thinking, more tech focused groups on top of that, doing it together in a syndicate variety. And then the last thing I was saying is you also just don't have as many new funds that are coming into existence in pure biotech. Tech bio will probably increase at a much higher clip than we've seen in biotech over the past three to five years.
Speaker 2:Sure. How do you handle breaking up with with managers as an LP? Feels like really like I mean, it's tough on the direct side too. If you back a founder, they come back for more money and you say like, you know, you have to sit it out for whatever reason, it's not great. But on the fun side, it's like you've been with them through basically multiple, almost multiple companies in some way, and maybe they had a bad sort of period, but they came back from it, and then it's bad again or whatever it is.
Speaker 2:But, like, what is that actual process like having, I'm sure, had to do it on a number of occasions?
Speaker 4:It's like what every person I dated before I got married said to me, it's it's not you. It's me. You know, in this scenario, there's always the ability to to stop backing a manager based on your pacing and how quickly funds have come back to market and your lack of available capital. If you're a fund of funds, you're raising your own money. If you're an endowment, you have a denominator effect to consider.
Speaker 4:And you are also all suffering from the fact you're not getting enough money back from a DPI standpoint. And so, it's more of a realize results, return money, we'll have more money to deploy and consider you or others when that happens as an easy out. But we tend to be much more transparent and objective. I just think that's the type of people we are. We try to benchmark it against other managers.
Speaker 4:We've backed. I mentioned we work with over 300 or so groups. We have a very robust dataset where we can actually show people in vintages how they would compare on a generalized anonymized basis against other people both in terms of TVPI and then also what they've returned back. We recognize that TVPI or total value over paid in capital is subjective. It's based on valuation practices, so we pierce through down to the underlying asset level and try to create a real apples to apples comparison where we know how five managers are carrying the same company and we come to our own conclusion on what that valuation should be.
Speaker 4:But if you give people objective kind of criteria on how they compare against others that you work with, it's hard to debate that. Ultimately, they get, like, two or three funds to prove it anyway because you're not going to come into one fund lily pad hop out of it and be done immediately unless they have some kind of catastrophic situation at the team level or organizationally where they've really screwed something up or have lost your trust as a counterparty. Otherwise, you're going to get a few funds if you raise them every two years to prove it. Then, ultimately, like, the results will tell the story. And we love our partners, and there are deep friendships on top of of everything else.
Speaker 4:But as an allocator and as a fiduciary for other people's money, you ultimately need to let the results point the way.
Speaker 2:You're like, help me help you have a number of liquidity events and then I'll maybe give you some of that money back. That makes sense. I know. Good great great explanation.
Speaker 1:Well, thank you so much for taking the time to come chat with us. This is fantastic. Let's do it again soon.
Speaker 4:My pleasure.
Speaker 2:Yeah. This was really Thank you so much guys.
Speaker 4:Appreciate you having me on.
Speaker 1:Have a great weekend.
Speaker 4:Have a great
Speaker 1:Have a great day. We'll talk to you soon. Goodbye.
Speaker 2:You too.
Speaker 5:You got
Speaker 2:a bunch of Hunter fans. You got a bunch of Hunter fans in the chat.
Speaker 1:Business is AI. Their business is securing it. CrowdStrike secures AI and stops breaches. Yeah. Huge huge fans in the chat.
Speaker 1:Thank you to everyone who was hanging around and chatting, giving us feedback. We appreciate it. Our next guest is Var Winkler from Wonderful, co founder and CEO, and first appearance on TBPN. How are you doing,
Speaker 2:Bar?
Speaker 1:Mister Wonderful. Mister Wonderful. What's up? Are you doing? Welcome to the show.
Speaker 1:Congratulations on the news. We'll get to that. But first, let's start with an introduction on yourself and the company.
Speaker 3:Great. Thanks for having me. Yeah. I'm Bar. Just moved into New York a few weeks ago.
Speaker 3:Nice. And landed from Delhi about two hours ago from a sixteen and a half hour flight, so
Speaker 1:Wow.
Speaker 3:Still working from my living room and
Speaker 2:Branding. Yeah.
Speaker 3:So CoolWonderful is an AI operating system coupled with deployment teams around the world. We are, I believe, one of the fastest growing applied AI companies today. We are operating in 33 markets with local offices in all of them, And that gets me on the frequent flyer on every airline pretty consistently. Yeah. Great.
Speaker 1:What is the smallest company that you hop on an airline for?
Speaker 3:To be completely honest, I don't really open airlines for stand alone customer meetings very often.
Speaker 1:Okay.
Speaker 3:It's almost always it's almost always hiring and and team building. Sure.
Speaker 1:It's just
Speaker 3:much higher leverage.
Speaker 1:Yeah. I imagine the the the forward deployed nature of your business. That becomes valuable once a company is post 50 employees, like they're past any self serve tools, they need deep integrations? Or is the most value going to the really big companies? We were talking about Campbell Soup earlier.
Speaker 1:I'm sure they have thousands of employees. Like, who is the ripest type of corporation that needs help transforming?
Speaker 3:In general, we bucket companies into over $750,000,000 and under. And at this moment, we are focusing all of our efforts on the first. We don't work with companies that are under $750,000,000 in revenue. Sure. With a few exceptions, right?
Speaker 3:The only exception would be if we have a customer in which we have CEO engagement, so like an absolute top down mandate.
Speaker 1:Sure.
Speaker 3:And we know that we are like the prime Applied AI partner. Yes, that would be and also we try to, I mean, least until now, this might change down the line, but we try to avoid working with VC backed tech companies. We really try to work in, We try to work in what we call critical industries.
Speaker 1:Yeah.
Speaker 3:We we think the alpha is much bigger there.
Speaker 1:Sure.
Speaker 3:The proficiency of tools is usually much bigger there. There is just like
Speaker 1:Yeah. VC backed companies, they already have a board member that's asking them every quarter, like, what are you doing with AI? So they already have that person in their ear.
Speaker 2:Yeah. What what what kind of what
Speaker 3:kind
Speaker 2:of advantage are are you getting customers? Like, where is AI actually having an impact outside of the obvious places? Making it easier to make a a slide deck, making it easier to review things like loan application or or obviously coding agents. But, like, where are some areas that your team is applying AI, getting, finding finding alpha in that that companies broadly don't maybe fully appreciate yet?
Speaker 3:Yeah. So, Wonderful started as a as an agents cost company mostly for customer support, mostly for voice. We then expanded to other modalities, through chat, email. We then expanded to back office processes. We then expanded to system replacement, or just like agentic apps.
Speaker 3:And we're now also expanding into new fields, for example, AI gateway and coding as well. We have so many different use cases with customers. Like, few days ago, I was in Mexico and met with this, like, large ISP that has over a 100 entities around the world, sorry, around Mexico for tax reasons, right? They just divide the revenue between many entities to not get above a certain tax threshold.
Speaker 1:Oh, interesting.
Speaker 3:And so the first use case that their CEO asks us to help them with is build an app for, like, reconciliation so they can reconcile between all of those different entities easier and faster. And actually, I didn't think it was a very big use case. That was, like, a bit surprised and talked with the CEO and asked him, like, what what's it about? And to make a long story short, they're they're probably going to merge with this other large company.
Speaker 1:We have a 100 companies too. You know what I mean.
Speaker 3:This other large company is an Oracle ERP shop.
Speaker 1:Okay.
Speaker 3:And the company we visited is an SAP ERP shop. Oh. So he told me, listen, I cannot stand the thought of having to integrate between two systems, which I obviously don't like, for the next five years. Yeah. So my ultimate goal is to leverage AI to create this new agentic ERP for the unified Interesting.
Speaker 3:And this is something that I've never heard before, coming from a CEO at this stage. Usually they know about software placement or creating a layer on top of a legacy software, but to actually replace an ERP for a company this old and complex, that's the first time I heard this, and I think that's pretty consistent to my experience in Wonderful. Because we work with enterprises and they follow the news, they constantly ask us for the newest stuff they read and hear about. So whenever something becomes like a talking point, usually are going to be one of the first to have to properly productize it and deploy it.
Speaker 2:Yeah.
Speaker 3:The same thing is happening now with cost control, which surface the need for better routing and the gateway product, etcetera.
Speaker 1:Mhmm.
Speaker 3:But, yeah, to your question, tons of different use cases.
Speaker 2:Do you Wonderful looks like in in five years? Because now it it sounds like there's you're building your own software, you're also doing a lot of services, one off projects. I imagine you're probably leaving some software behind, then you're maybe managing that, but, like and then you're working on a gateway. Where what what does the business look like in in five years?
Speaker 3:So so we don't do wonderful doesn't sell any services. Right? Everything we everything we sell is consumption and and the platform itself. And sometimes we attach use case fees to certain complex use cases, but these are all recurring. We don't charge for a single FD or DS that is deployed with our customers.
Speaker 3:As as a principle. It's very hard for me to tell you what Wonderful looks like in five years. Because five years is just a huge amount of time in this day and age. My gut is that in five years, Wonderful is an independent company, one of the largest applied AI companies in the world, mostly seen as an infrastructure. So mostly known for our AI operating system, with millions of different people around the world building their company on top of Wonderful, as an infra.
Speaker 3:I think in a similar way in a similar way to how Microsoft is perceived today, or how Microsoft was perceived a few years ago. Right? That's pretty ambitious. But I I would say that's more the north star than, let's say, Palantir.
Speaker 2:Yeah. So so so you're you end up building something net new customer, productizing something for a customer, but then you're you're fine not charging for that build out because you plan to use that same product. You'll you'll be able to resell it to other other players and capture margin that way. Is that is that right?
Speaker 3:So so the the the flywheel between front end engineers or FTEs into the core product team is something that happens pretty naturally because no one wants to do double work. Right? And the the challenges between different enterprises around the world are relatively consistent, regardless of where they are geographically. So whenever there so wonderful has a library with, like, hundreds of different agents and apps that were written on the platform, and that's the first place that an FD or DS, for example, would go to find out, like, a good starting point for their own solution. Most of the bespoke stuff that we build are actually integrations on the customer's end.
Speaker 3:We don't build that much, like, bespoke features into the core product for one customer. The vision for me is to go after large use cases one by one, and I think the north star should be that Wonderful acts as a zero to one or like an agency machine for enterprises with all of those use cases we built left to their own engineers and own business stakeholders to manage on our infra.
Speaker 1:Did you the company?
Speaker 3:Founded the company in January 2025. Wow. So a bit less than two years ago.
Speaker 1:And what's the latest news on the fundraising side?
Speaker 3:We announced c round a few days ago.
Speaker 1:Give us the number.
Speaker 3:As announced. We raised we raised $550,000,000. Oh, yeah. Let's
Speaker 1:go. Bang.
Speaker 2:Big number.
Speaker 1:Incredible speed. Incredible Incredible speed.
Speaker 2:Last last question before you jump in. I'm I'm sure you'll be back on for the next round. But you're there's a bunch of different products tying into the platform. Do you ever see yourself getting into the inference business? Or is that something you're fine working with partners?
Speaker 2:Like, do you do you imagine actually setting up your own, you know, data centers, or or is that not, like, an area that you feel like you're getting a lot of value out of?
Speaker 3:So I don't have a, like, religious answer on this. I I I or I guess the first principle is that, wonderful, we see ourselves as the apply the eye partner for the enterprise. So when everything when when whenever something becomes commoditized, we want to be the first to productize it very well and give it access to the enterprise. A good example, for example, is like coding, right? Coding was a very hard science problem up until maybe yesterday, right?
Speaker 3:Or a few months ago.
Speaker 1:Yeah.
Speaker 3:As soon as coding becomes a sheer engineering problem, then why wouldn't it be part of wonderful? Just as a first principle. So if inference becomes so commoditized that we think it's better for us to own it, then sure, we'll own it. But we don't have a principal decision to to do it anytime soon.
Speaker 2:Yeah. Makes sense. Last question because we didn't get to it in the beginning. I'm curious. What were you doing before this?
Speaker 3:I was the founder of a pretty standard b to b SaaS company that I sold in 2021, and then I worked three and a half years.
Speaker 2:We're we're number one defenders. Thank you for your service. In the SaaS trenches.
Speaker 1:Yeah. We love it.
Speaker 2:Great to meet you, Bar. Yeah. Congrats on all the progress.
Speaker 3:Thanks for having me.
Speaker 1:Yeah. Good luck. Get some sleep. Enjoy the weekend. Hopefully, you can rest up.
Speaker 2:Job. Cheers.
Speaker 1:We'll talk to you later. Goodbye. Let me tell you about Railway. Railway is the all in one intelligent cloud provider. Use your favorite agent to deploy web app servers, databases, and more while Railway automatically takes care of scaling, monitoring, and security.
Speaker 1:I believe we have our next guest. We're ready to rock.
Speaker 2:Here they are.
Speaker 1:Welcome to the show.
Speaker 2:What's going on?
Speaker 1:How are you?
Speaker 6:How are you?
Speaker 5:Hey. How are you?
Speaker 1:You so much for taking the time. Let's kick it off with some introductions on both of you and then we can go into the news today.
Speaker 5:I'm Ken Ono. I'm founding mathematician at Acxiom Math.
Speaker 7:Yeah. I'm Carina Hong, founder and CEO of Acxiom Math.
Speaker 1:What is the latest in your world? What is the Is
Speaker 2:there anything left to do, Ken?
Speaker 1:Yeah. Job's finished.
Speaker 5:Well, no. Actually, I I think it's a wonderful time for mathematics now that we have tools that can empower Mhmm. Mathematicians. The questions are still there. Mhmm.
Speaker 5:Last I checked, the Riemann hypothesis is still unsolved. Yeah. So it's a new era.
Speaker 1:Yeah. That is the benchmark for everyone. Certainly for the AI labs, you can see that they're both were, you know, of the companies are working on this. Do you see Three
Speaker 5:of us, you mean.
Speaker 1:Yeah. Everybody. Everybody is working on this. But do you see these particular challenges as good benchmarks, or is there a more a more broad overarching vision? Or or or is it worth focusing on these specific things like the Riemann hypothesis?
Speaker 5:Well, just very quickly, I'm a pure mathematician, so I don't think in the world of benchmarks. Yeah. The problems are there, and I love the problems. Some of the problems get solved, but every time you solve a problem, there are new problems. So I think it's an exciting time.
Speaker 5:It's very disruptive for the community. Mhmm. It's let's face it. But moving forward, six to eight months from now, I think I think scientific research will be thriving.
Speaker 1:Yeah. I think Yeah. Please.
Speaker 7:Yeah. The history, I think, has been that every mathematical discovery, like, unlocks, like, either an applied like, an actual real world application, like, hundreds of years down the road, or it even starts, like, new fields in science. So we're very excited about all these mathematical discoveries happening. Mhmm. For the audiences who don't know what's new, we had an exciting week.
Speaker 7:The very long, astonishingly, notoriously hard problem bounded gap in primes have been the world record has been updated three times this week. First by Julia Stalman, the human mathematician, getting two forty down from two forty six, and then by Axiom Math at two twelve, and then by opening at Astra at one eighty six. So it's a Wow.
Speaker 1:Yeah. I'm looking forward.
Speaker 5:I I have a blitz.
Speaker 1:Is it ever like this in math? This is this is No.
Speaker 5:No. Yesterday.
Speaker 1:A football game.
Speaker 5:Yeah. That that is all new. There's an analogy, if I could just very quickly say, Freeman Dyson was a very famous mathematician and physicist. And he described mathematics mathematics as mathematicians could be the birds or a mathematician could be a frog. And right now, right now, we're in a position where we're amplifying the flyers.
Speaker 5:Sure. The ones with vision.
Speaker 1:Yeah. I like that. What else can you tell me about reaction from the mathematics profession and also what the role of the mathematician was in the pre AI era and what it might look like in the post AI era because I know a lot of very successful mathematicians who have had full careers as professors and proving theorems and working on these hard problems wasn't something that was really on their resume necessarily. Like they they contributed so much else to the world and they lived full lives and had wonderful careers And it wasn't purely about the the gamesmanship, although we're now it's game on.
Speaker 7:Proof Olympics time.
Speaker 1:Yeah. Proof Olympics. So
Speaker 5:so like I said, I think the questions that we that that I wake up in the morning thinking about Yeah. They're still there. It's just the paradigm. It's the the tools that we use that didn't exist before are amplifying us. Yeah.
Speaker 5:I think that's where we are. It's a great time.
Speaker 7:So so to track kind of like the the community of mathematicians, but also the community of researchers working on AI for math, Pat Shafto, who is a program manager at DARPA Mhmm. Organizes this sort of meetup every every two months or every three months. And we just went to the last edition of that. It was, like, two weeks ago in Seattle. Terry Tau was there.
Speaker 7:Alice was there. Boris Alexi from OpenAI was there. A lot of the academics who are working on harness engineering that are great mathematicians are there. A lot of industry AI researchers are there, including people from OpenAI. We were there, and AWS was there.
Speaker 7:The the energy is incredible. I think it's like the it was like a three day, like, research program. Everyone was reporting their newest, the open source model. Godo Prover has version three. That's Princeton Labs, Sanjeev Arora's.
Speaker 7:The community is thriving. I think we're, like, seeing these incredible number of open problems that suddenly become attainable because of the technology advancing.
Speaker 2:How do how do you guys make money? Yeah.
Speaker 7:That's a great question. I think the word is going
Speaker 5:She paged me.
Speaker 2:Oh,
Speaker 7:wow. The word the word is going to, I think, run on a different kind of flywheel of generation and verification. So we don't really think of formal verification as kind of, like, guarding or, like, capping the downside. We think of it in terms of performance, and we think of it as optimization. So by having the cost of proof reduced to zero, you can generate new algorithms.
Speaker 7:You can make new scientific discoveries. It's going to have important implications in the world of coding, in the world of AI for science, and other, like, physical engineering disciplines that we couldn't think of in the past.
Speaker 5:So put another way, the world runs on code that people don't understand, many people haven't even read. So software verification, hardware verification, as Carina says, is kind of the challenge for the future and that's really like doing math.
Speaker 1:So lean startup of the future. All code written in lean or something like that. Formal verification coming to all software for with cyber security benefits potentially. Is that the idea?
Speaker 7:Are a lot of different viewpoints on this. So, I've met researchers who think that, all the word software should be rewritten.
Speaker 2:Yeah.
Speaker 7:There are other people who believe, wow, we should formally verify everything. Yeah. The truth is, I think, somewhere in the middle. Mhmm. People traditionally think of formal verification as something that you get zero credit for if you don't formally prove everything.
Speaker 7:Mhmm. We think partial verification has a lot of value. By decomposing or refactoring, each word has its own, like, loaded meaning Yeah. A very difficult problem into subproblems, a very difficult coding challenge, coding task into different modules. You can get assurance in certain parts and try to, just lock in and optimize because you now have that formal guarantee.
Speaker 7:Yeah. So it's, again, this idea of verification for better performance.
Speaker 2:I love it. Can you can you guys walk me through your your basically psychology when you're working on some of these open problems and you know that there's a bunch of different teams that are also working on the same set of problems. And it it feels like one of those things like where there's insane urgency because you could spend three weeks Yeah. Working with models and your own harness and tools like trying to solve something and then someone comes out with it and it's like, you know, the whole the you you don't get any credit for for your work because someone beat you to it. But do you are you feeling that pressure right now or is there are there enough like sort of disparate problems that Yeah.
Speaker 5:That that's a great question. So the way we do it here Acxiom, we have little team called the a team, small but mighty. We have a list of problems that are our favorites. And on that list, there are some big problems like bounded gaps and primes, which we know the whole world of mathematics cares about.
Speaker 1:Yeah.
Speaker 5:So to tell you the truth, I'm not in a race with them until we get the idea that we're all onto the same problem. And recently, Julia Staubman's paper that came out a few days ago was a landmark moment. When that appears on the archive, you know that everyone in the world and the community is trying to optimize that. So there was crazy urgency the last couple of days. Sure.
Speaker 7:The psychology behind the scene was, I think, in February, we tried having Axiom Prover tackle research conjectures in fields that are pretty deep, have a lot of theoretical literature. And that was that was successful. So Axiom Prover was able to put on archive a few researched open problem solutions completely automated and also fully in lean without human intervention. That's in February. Immediately, at the beginning of March, we were setting more North Star visions.
Speaker 7:As Ken said, there's a list of targets that we were excited to go after. The problem of bounded gaps in crimes is a particularly beautiful one. It is a lot of people's childhood dreams. So I think yesterday, I saw Wei Jie Su, an OpenAI researcher, post that when he was nine. He knew about the problem.
Speaker 7:For me, I was I was 12 years old. I I knew about Itau
Speaker 1:Jong. Success. Yeah.
Speaker 7:So so it was Itau Jong's, like, solution of pushing that to the finite balance, 70,000,000, which is a very, very large number compared to today, the new world record. But that is a problem that's very fond to a lot of our hearts. So it's very natural that a lot of people are working on it. Mhmm. I think no one has ownership of any problem, and the word of scientific discoveries is pretty infinite, so you have a lot of problems to go after.
Speaker 7:We think we will probably enter similar races like the one with OpenAI we just had yesterday in the future. And, also, we are formalizing big problems, so we just saw anthropic announcement on formalization of Fermat's Last Theorem.
Speaker 1:Sure.
Speaker 7:We have been working on similar things. So we're excited to continue to go head to head with OpenAI and with Anthropic.
Speaker 1:I love it.
Speaker 7:We are a thirteen month start up, and we we sometimes could be disappointed by, you know, being beaten the world record in a few hours, but we'll keep trying. And I think you're
Speaker 2:very much in the game.
Speaker 1:In the game.
Speaker 5:Yeah. Another thing I wanted to say though is among the problems that are our favorites, there are community so last week, we set a world record on a problem called the parity of the partition function. Mhmm. It's not as famous as as bounded gaps and primes. Sure.
Speaker 5:But for those communities, it set a world record. So Mhmm. Our portfolio is vast.
Speaker 1:Does a, does math exhibit the same slop problem that you see in text and code generation? You know how like you can go to a deep research report, it can write a really, really solid history paper that might be PhD level, no hallucinations. But the experts and people who know this will just say, ah, just the flavor is not quite there or it has it has it has AI written all over it. Does that exist in the lean that is produced like formal proofs? People are like, ah, yes, it works.
Speaker 1:Congratulations. But it's still a little sloppy.
Speaker 7:Three layers. One is correctness. So a lot of in in the past, we'll be worried about correctness.
Speaker 1:Sure.
Speaker 7:Fortunately, you have lean. Yeah. And then two additional layers of taste. One is the code quality of the lean formalization. Yeah.
Speaker 7:The choices of what to keep conditional. The particular class, how you approach definition of a very central mathematical object. And in our formalization of the two forty six bounded gaps, which was done by polymath a b, we really emphasized on reusability, on producing really good code quality so communities can build upon it. And then the third part is the taste for the mathematics. Yeah.
Speaker 7:Ken, do you want to add on that?
Speaker 5:Well, the taste for mathematics really matters. Okay. You know, honestly, the the percentage of math that has been understood by mankind that out of all the math that probably exists, probably close to like one or 2%. Math is we're just always discovering things. But you can prove theorems that nobody cares about or will have no application to the real world.
Speaker 5:And what's the good in that? So the human taste and the judgment and the final arbitration for what matters is very much a human thing.
Speaker 7:Yeah. I think I when I was a student in Ken's he's REU. I remember Ken giving me the critical feedback of the symbol for elliptic curve conductor must be l. And if you use any other symbol, you will be criticized as not an expert in the field.
Speaker 1:Very cool. Well, thank you so much for coming on the show.
Speaker 2:Yeah. Fascinating. Congratulations. And super super impressive progress Yeah. From the whole team.
Speaker 1:Keep up the good work.
Speaker 2:Can't wait to see what you guys ship next. We'll talk to you soon.
Speaker 5:Alright. See you. Aloha.
Speaker 2:Aloha. Cheers.
Speaker 1:Let me tell you about MongoDB. What's the only thing faster than the AI market? Your business on on MongoDB. Don't just build AI, own the data platform that powers it. There is a fascinating deep dive, an investigative report in the Financial Times wealth section.
Speaker 1:Playing with Fire, the Chinese Cambodian billionaire Chen Zhi. As an investor, Cohiba Sikars became ultra luxury symbols, then things came crashing down for the tycoon. It's a longer read. I don't know if we can go through it all, but there's some fascinating things here. One is that in 1962, JFK, he goes to his press secretary and says, I need 1,000 Cuban cigars Because as soon as they arrived, Kennedy signed the order imposing US embargo on Cuban goods.
Speaker 1:So he knew that he was going to block Cuban cigar importation, importing. And and he said, I I I need a little stockpile, so get me a thousand Cuban cigars. But this is a yeah. It's a strange business. Chinese born billionaire who moved it to Cambodia in his twenties and became extraordinarily powerful extraordinarily quickly.
Speaker 1:By 2020, his prince group claimed interests ranging from real estate to banking to supermarkets and an airline. Then he owned a 35 53 meter yacht with its own nightclub on it. He bought a $100,000,000 basically £94,000,000 London office building and a £12,000,000 mansion and cultivated the image of a connected international tycoon but Chinese authorities had already begun I like how
Speaker 2:he cultivates that image too.
Speaker 1:A little bit. Yeah. And he's got some tycoon.
Speaker 2:He's one years old. How is he how is he doing all that he's doing? How does he know who he knows?
Speaker 1:Yeah. But Chen, his most unusual asset was in Cuba. In 2020, Imperial Tobacco sold its half of Habanos, which is the group that control that markets Cohiba, Trinidad, and the company's other famous brands. They generate roughly $500,000,000 annually in the Cuban cigar market. And there's this weird illegal Cuban cigar market that has created a bunch of pressure where the Cuban cigar companies struggle to even supply the actual the legal market because it's it's so complex.
Speaker 1:But he he he buys into habanos giving him an indirect stake of nearly one third of the Cuban cigar company. And he explored cigar warehouses in in Singapore, cargo flights between Havana and Cambodia, really starts trying to expand the operation. But his empire imploded on 10/14/2025. The US and The UK froze Chen and the Prince Group, his company's assets, with American prosecutors alleging that Prince Group was actually one of Asia's largest transnational criminal organizations operating compounds where trafficked workers were forced to conduct online scams. He denies the allegations, but in January 2026 Chen was extradited from Cambodia to China and effectively disappeared from public view.
Speaker 1:Days later liquidators were appointed to dozens of companies connected to him including the vehicle that owned his stake in the Cuban cigar company. His lawyers are fighting the liquidation but potential buyers are already circling cigar investment trying to get a stake. I don't know. Maybe things will change over time. But the bigger problem is that habaneros may have damaged the business.
Speaker 1:The price has exploded.
Speaker 2:Astra has landed. What happened? Astra seems to have landed Explain. Lot in of prosumer accounts.
Speaker 1:Oh, cool. Yeah. Yeah. It's available. Let's let's refresh.
Speaker 1:I I was looking at it. It is in my personal pro account, not on the chat tab, but on the work tab. So if I go to chat.com and then I click on work and then I check the model picker, I got GPT six Astra here. And and not to make it too simple, I got light, medium, high, extra high, max, and ultra, which
Speaker 2:can see So the limits
Speaker 1:take it for a spin. If you have a ChatGPT pro account, this is your weekend. Tell your family you're locking in. You're vibe coding something in Blender taking it to Unreal Engine. That blog post, it's an Unreal Engine video game now.
Speaker 1:It's multiplayer. It's going to happen. Anyway, we have our next guest here with us in the waiting room. Let's bring in Bridgit Mendler from Northwood. Welcome back to the show, Bridgit.
Speaker 1:How are doing? Back.
Speaker 6:Hey, guys. Doing well. How
Speaker 7:are you?
Speaker 1:Thank you so much for hopping back on the show. Great to see you again.
Speaker 2:So many flags.
Speaker 1:So many flags. Where are you calling in from? What is this new This
Speaker 6:is this is old space.
Speaker 1:Old space.
Speaker 6:Okay. This is this is Northwood HQ. Okay. First first Northwood HQ. Yeah.
Speaker 6:And yeah. We we're starting to call ourselves the United Nations of Northwood. So just more more flags representing really the the countries that we have a presence in.
Speaker 2:Yeah. I was gonna say it's if there were people if it was representing the people on the team, I imagine there maybe be a few more. But yeah, very very very cool. Yeah.
Speaker 1:Yeah. Has international expansion been like? Why is that important to the actual rollout of the the product, the technology, the business? Why do you have so many flags so quickly as a relatively young company?
Speaker 6:Right? No. We're we're doing startup on hard mode. Why Yeah. But so reminder, we do networking for space and Yep.
Speaker 6:You know, you can I I like to do the comparison to like a cell towers when you're going down the freeway? You need to hit different cell towers to stay in contact. Same deal with the satellite. It's just way further away. And so their equivalent of cell towers are literally on different countries or continents, and that's how you can provide the continuity of coverage.
Speaker 6:So we kind of have to stand up a bunch of sites around the world to support satellites orbiting. And, yeah, it's it's challenging. It's part of the game. But I think that's really gratifying.
Speaker 1:What is the state of yeah.
Speaker 2:What what is the actual process of a search look like? I imagine in a bunch of areas of the world, you are looking at a region that encompasses multiple countries, and so are you basically doing like a road show and you know, you wanna get buy in, but then there's probably also incentives that you can get, but like, how does that actually work? If I'm not not planning to compete. To be clear.
Speaker 6:Give me the secret. Yeah. No. It I mean, the annoying answer is it depends. It really depends on what the satellite operator is maximizing for.
Speaker 6:So some will care about, you know, their contact time metrics. So wanting to make sure that they can have, you know, minimal windows of gaps between their contacts. Others will care about, can you drop data in this one very specific location? And so once we have that customer parameter, then the question is, know, you where's the infrastructure that makes things cheap and easy for Northwood? What country is is a good partner?
Speaker 6:And and then kind of kick off the the the lease hunt and the construction and all that from there, and then we get it up and running. So, yeah. We've we've been busy. We've been doing that in a lot of different countries, and was thinking it could be fun showing the factory floor. So it's been filling up a bit, and so we need to move to the new spot.
Speaker 6:So these are our portal and prism units.
Speaker 1:What's the serrated edges for? Do you have pigeons that land on the edges of the I've only seen those on like park benches in New York City.
Speaker 6:Yeah. No. You're not the first person to ask about that. Really for our antenna performance. So we we wanna make sure that we're really precisely hitting where we wanna go and Okay.
Speaker 6:And, you know, RF has this thing called side lobes Yeah. Which can means that the the signals will bounce off in kind of unintended ways. And so that's a way for us to kinda control where the signals go.
Speaker 1:Interesting. So if I How much space in in pigeon defense, things that might make my WiFi better or worse?
Speaker 6:Literally two birds with one stone. Avoid the pigeon, avoid the Oh. No. I I actually I I don't
Speaker 1:know that. You have to test it.
Speaker 2:So how much space do you actually need in a country? Is this like you can get by with like a quarter of an acre or how like the the the Yeah. Hardware doesn't look like massive.
Speaker 1:Yeah. You're not building like scratch
Speaker 2:power and it's secure Yeah. And it but No.
Speaker 6:That's the whole deal. We we compress it a lot. So our our portal system, which is right here Mhmm. It's designed to replace a 7.3 meter dish antenna, which is a hard number to visualize, but think of like a two story building. And so those portal antennas, you can combine, like, six or eight of them together and it replaces that.
Speaker 6:But the cool thing is you can actually do multiple satellite contacts at once. So what might take like multiple football fields to support that much contact, you can actually do in basically the size of like a strip mall parking lot.
Speaker 2:Mhmm. Very cool.
Speaker 1:I had something else. Now I'm blanking. Lost my train of thought.
Speaker 6:Yeah.
Speaker 1:I guess I guess my question was what is driving growth of demand for ground stations satellite connectivity generally? Yeah. We've seen Starlink's meteoric rise. Then more recently, I think earlier this year, there's sort of like the the like the other side, the other team that's emerging. There's some deals with ASTS, some other earlier stage.
Speaker 1:There was an acquisition. Yeah. There's a few other Internet providers. Feels like there's at least going to be an attempt at making that a duopoly or oligopoly. But then there's also we've talked to Planet Labs.
Speaker 1:There's so much else that's going up in space. There's government stuff. What what what do you see as, like, both the near term driver of demand for you and then also longer term?
Speaker 6:Yes. Great question. Overall, North with thesis was more things are going up into space and they need to be able to control the spacecraft. They need networking to control the spacecraft and to be able to sell more bits. That has definitely proven out.
Speaker 6:I think, you know, government and commercial demand for space, it's never been higher. Every operator needs those functions. And so for us, you know, moving to a new factory is about how can we ramp up the production on that hardware to support that. Mhmm. I think, you know, when when you think of the product lines on the portal side, which is the one I just showed you, think of missions that need to do complicated in space maneuvers, kinda like a Star Wars moving in space.
Speaker 6:So there's more customers trying to do that. And so that's driving expansion of that product line. The other one, the Prism product is really about how do you do, like, scalable highly scalable, highly reliable networking for Constellation. So kind of like the Mhmm. The folks that you're mentioning there.
Speaker 6:A lot of demand. I I you you guys mentioned a fair amount of it. I think it's been a crazy year for space. Right? I mean, we had the the SpaceX IPO.
Speaker 6:Huge amount of, like, enthusiasm and appetite. I like, one of the things I I was kinda curious to talk about with you guys because I imagine you're you're hearing it and seeing it too. It's like we're in this weird dichotomy where it's like appetite for space has never been higher. At the same time, there's like all of this concern around launch being constrained. Sure.
Speaker 6:It's a wild time. It's a wild time for the ecosystem I think. And, you know, I have my own soapbox on on like what that means and how the industry is gonna respond as a result. But
Speaker 2:Well, yeah view as a I I wish that we had more more alpha to share to you share with you on launch bottlenecks but you're the one buying launch capacity like No. How how much
Speaker 1:It doesn't need to. Well, so so Downstream of it.
Speaker 2:Yeah. Yeah. Down You're you're you're sort of limited limited by it Yeah. Potentially in the future where you a a good scenario is you get to the point where you're like, we are generating as much revenue as we can based on what is currently Going up. Space.
Speaker 2:And Yep. New revenue will be dependent on that. But how much of the how how you know, we had the the founder of what's his name? The space Philip from Star Cloud? Yeah.
Speaker 2:So Philip from Star Cloud was on. He said part of the reason to raise their they raised another 250,000,000 Oh, yeah.
Speaker 1:They're buying already.
Speaker 2:Yeah. And 2029. Yeah. But when you talk to different space, you know, teams, is that like really like super top of mind for them or do they have is that like problem number five after making sure that their satellites and spacecraft actually work and all those other things?
Speaker 6:I think it depends on kind of the maturity of the company, you know, for a lot of companies or, you know, things like that. They they've already had their established plans, so it's not an immediate impact or concern, but something more down the road. You know, government operators have their ways to to get what they need even under those conditions. But I I I think, like, self self servingly, what I think is interesting, you know, we like you guys said, we serve objects that are already in space. So we get to, you know, continue to have market there and then into the future.
Speaker 6:But I think what's gonna be really interesting is if you do have constrained launch, you actually need to eke out as many bits, like what you're actually selling from space as possible, and you need to do it as at high dollar as you possibly can. So, like, each one of those bits counts for so much more. And so, you know, my thoughts around that are, like, point one, if you need to eke out more bits, how are you gonna do that? You need higher utilization. That means, like, more seconds in contact with whatever that end customer is on earth, making sure you can actually transact for as many seconds as possible.
Speaker 6:And then how do you send as many bits as you can per second? So, like, you you get as as much as many bits out of each of those seconds as you possibly can. So that's, like, throughput and utilization, really. So that's one piece. And then the other piece is like how do you get customers to pay higher dollar for those bits?
Speaker 6:Like, let's imagine there's some kind of winter where you're limited in the number of satellites that you can launch into space. You want all of them, like, maximized. You want all of them monetizing those bits as much as they possibly can. And I think that's where it comes back to, you know, reliability. Right?
Speaker 6:Like, that's something that US government pays for. Mhmm. That's something that more enterprise use cases really pay for and prioritize. And so I think, like, you know, bear case scenario, that's what happens where all those operators are are treating their assets differently in a sense where they're really prioritizing that utilization and and high value, which, like, I think we've kind of been designing to serve for. So selfishly, I think that that works out well.
Speaker 6:But, you know, bull case, we we figure it out and there's some other launch provider that swoops in and saves the day.
Speaker 2:Similar kind of like at this point, sort of like intellectual debate on what happens with compute on earth. Like, does compute aggregate towards, you know, certain model providers that are at the frontier that can get more economic value out of out of a Exactly.
Speaker 6:Out of
Speaker 2:a data center or a single GPU. I'm curious about, like, how does it how does the launch
Speaker 1:do you know about launch? Netflix in space to free up the ground compute for AI?
Speaker 6:I mean
Speaker 1:Might be easier. Yeah.
Speaker 2:How does the how does the is there a secondary market for launch? Like, if you like, I'm thinking about, like, people that are buying launch capacity today or or preordering it and then they get to twenty twenty nine and they're like, wait, this is not the most economically
Speaker 1:Oh, like sure. Sure. Sure.
Speaker 2:Yeah. Use case of this Resell. Capacity. I imagine Elon would be like, cool. We're gonna be the one reselling that.
Speaker 2:It's hard to imagine. Who knows?
Speaker 6:Right. Yeah.
Speaker 7:Depends on
Speaker 2:the rider.
Speaker 6:I would imagine that. You're not the first person to float that idea though.
Speaker 1:What about your I don't know if they're KPIs, but your benchmarks. Yeah. Like, you mentioned sort of like the the throughput and availability of a connection. And it Yep. And that feels like we're almost in, like, the pre like, with if I just think about WiFi connectivity, I think about throughput and latency.
Speaker 1:Availability is almost more of a bottleneck now. But hopefully, we get to a place where availability is universal. And then does latency matter? What are the other Yeah. Kind of selling points and, like, benchmarks that you're using to understand the performance of your system versus the status quo?
Speaker 6:Yeah. I think I think throughput definitely matters. And then I also think there's an interesting kind of like, you know, I I I I've mentioned the word, like, industrializing before, which I know is, like, it's it's a buzzy word and all that. But I think, like, what I mean for space with that is, like, as more and more use cases go to space, then you start applying those KPIs that might have applied to terrestrial market terrestrial networks to space. And so one of the ones that, like or some of the ones that we've been thinking about, yes, I think throughput really matters.
Speaker 6:What's interesting is that's actually about not just a single direction of throughput. People may sometimes not think about that, but, throughput is actually a bidirectional thing. So you need to be able to both send traffic and receive traffic, and some systems are set up to do that in an asymmetric way versus ones that are set up to do that symmetrically. So, you know, just like one thing that we think about is is, like, yes, throughput and which direction is it going, and that's actually really relevant when you think about different markets. And then the other one is, the reliability piece that I said.
Speaker 6:So you think about I was chatting with somebody from, you know, Cloud flare recently and and hearing about their kind of reliability metrics. Like, people tend to measure it in terms of the number of nines Yeah. That you can support.
Speaker 1:Yeah. What is space? Does space have any nines?
Speaker 6:Been pitiful nines.
Speaker 1:Yeah. Can imagine it's like
Speaker 6:zero nines. Well, and it's so for like for for the actually, for for higher reliability use cases. Right? Like US US government uses space and needs to have really high reliability Yeah. Performance.
Speaker 1:GPS has been up for decades. It's probably Yeah. Five nines at least.
Speaker 6:Yeah. Yeah. And so, like, the way that they do that is by either, or both. Like, you have hardware that becomes much more expensive to make it more performant and then you have much more of it. So you have, like, backup and failover and all that.
Speaker 6:Yeah. And so, yeah, one of the ways that we design is like, how can you have that reliability at a much more like commercially viable price Because wouldn't that be so cool if you could use space for so many more terrestrial applications? Yeah. So anyway, those are those are like two metrics that we pay attention to when we track. And like, you know, we're we're in baby network stage right now.
Speaker 6:So we are very much trying to like fail as much as we possibly can. And like, you know, if you have a bad uptime day, like good job because you spotted a problem. But eventually, yeah, I think we will want to be driving towards like really competitive reliability metrics.
Speaker 2:Yeah. Jocko Jocko mindset space. I guess. Yeah. Problem?
Speaker 2:Good.
Speaker 6:Yeah. Right?
Speaker 1:Gives you that
Speaker 2:Have you had any any any like big multinational telecom players like, trying like, seeing what you're doing and thinking, hey, we should probably get ahead of this and and and start try to compete? Or is it still feel like a like a Partnership. Partnership in the field?
Speaker 6:I think they're definitely paying into they're paying attention to space in a big way. Mhmm. And I think there's more opportunities for collaboration Mhmm. Or for for just like interesting configurations than maybe people imagine. Like, I know there's been a ton on the, like, direct to cell conversation.
Speaker 6:Right? Like, getting satellite signal directly to your phone. It also could be a part of the cellular backhaul setup, things like that. Yeah. You know you know, for instance, like a lot of our backhaul connectivity today is still done over microwave, which is a point to point RF link.
Speaker 6:It's just not up and down. It's side to side. Yeah. And so I think there's a lot of a lot of ways that that the telcos can engage with space and obviously they already are. They're paying a ton of attention to it.
Speaker 2:Last question. It feels like a natural place to put your portal and prism would be where there's existing Mhmm. Like it it's all the right sort of like setup to Yeah. To do one of these things.
Speaker 1:Last question from the chat. The wired headphones, you
Speaker 2:Yeah.
Speaker 1:Is this because there's a lot of RF interference in your headquarters? Or are you just a wired headphone respecter like Jordy Hayes here? He loves that.
Speaker 6:I wish that was the case. To be honest, these were just the first ones I could find. No no political No.
Speaker 2:People don't we we get no. We get We get annoyed because I we want more people to call in with Wired because there's no delay.
Speaker 1:Yeah. No. It's actually a better experience. Most why I did re call ins. It's my it's been crystal clear.
Speaker 1:So thank you.
Speaker 6:I'm so glad.
Speaker 1:You coming on and breaking it down.
Speaker 6:Okay. Awesome. Yeah. Great to see you.
Speaker 2:Great update. We'll talk to you Excited to see more flags up there next time. Sweet.
Speaker 1:Talk to soon. Bye. Goodbye. Let me tell you about public.com. Investing for those who take it seriously.
Speaker 1:They got stock options, bonds, crypto treasuries, and more with great customer service.
Speaker 2:Jordan, what else is in the timeline that you want to Crusoe raises over
Speaker 1:Oh, yeah.
Speaker 2:3,000,000,000 Chase. At 30,000,000,000 on an absolute tear.
Speaker 1:He's chasing capital.
Speaker 2:He's locking it down.
Speaker 1:Mean Chase.
Speaker 2:He is the bank. Yeah. He's the bank himself. Yeah. More importantly though, the National Weather Service forecast dangerous beach conditions for the Malibu Coast
Speaker 1:Dangerous.
Speaker 2:Starting today.
Speaker 1:Dangerous for novices or dangerous for someone at your level? That's impossible.
Speaker 2:Dangerously good surf absolutely electric surf conditions heading into this weekend.
Speaker 1:Out there.
Speaker 2:Hope to see the TBPN nation in SoCal Yep. Taking advantage of this hurricane as well. We're gonna have back to back days of, you know, phenomenal Yep. Activity Yep. In here on the Pacific.
Speaker 2:So I'm thrilled. I'm excited. Yeah. Hope to get you out there, John. Right.
Speaker 2:I would love to see you.
Speaker 1:I might be tinkering with Astra. Who knows?
Speaker 2:I could see you getting into e foiling, you know. E foiling.
Speaker 1:I got a I got a startup idea. What if you made a a message board or bulletin board just for AI agents? I guess that would be Motebook. But why why do the agents love hacking into everything and making just using it as a message board? They're obsessed.
Speaker 2:Easier than having to figure out how to ship your own forum, basically.
Speaker 1:There's something at a very deep level. I mean, the the the there's another example of beyond the hugging face, they were using artifactory, like the internal package manager as a discussion board. Now there's news that they hijacked a German website this spring and transformed it into a bulletin board for other AI agents. That's from Reuters. There's something about I'm still so interested in why they need to do this and why collaboration is not prebuilt into the system, because that feels like it'd be more monitorable and stuff.
Speaker 1:But, well, I'm sure we'll have more reporting on the, the Hugging Face incident and what flows from how these agents collaborate with each other. Obviously, monitorability and AI safety is very important. So it will be interesting to see where those where where where all that goes. Was there anything else, Jordy? What else is
Speaker 2:I think that's it. That's it. There's a bunch
Speaker 1:more posts, but we'll get to them because we'll be back on Tuesday. Have a happy late
Speaker 2:wonderful Have a wonderful three we will says great weekend to get out on the pontoon in Malabar. Pontoon would be insane. Yeah. Pontoon might flip it. Yeah.
Speaker 2:Could be fun to flip it. Yeah. Sounds good to see. Yeah. Be safe out there.
Speaker 1:Yeah.
Speaker 2:Be safe. Have a wonderful three day weekend. Yeah. Love you guys.
Speaker 1:We'll see
Speaker 2:you Tuesday.
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