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Technology's daily show (formerly the Technology Brothers Podcast). Streaming live on X and YouTube from 11 - 2 PM PST Monday - Friday. Available on X, Apple, Spotify, and YouTube.
You're watching TVPN.
Speaker 2:Today is Monday, 11/10/2025. We are live from the TVPN UltraDome.
Speaker 1:The Temple Of Technology. The fortress of finance. The capital is capital.
Speaker 2:The capital is capital. What do you say?
Speaker 1:The capital of capital. The capital of capital. Capital is capital. We have a
Speaker 2:great show for you today, folks.
Speaker 1:The market is up. Market is up. It's in a white suit.
Speaker 2:White suit. Jordy, why
Speaker 1:are you I'm not. I I actually so I moved into a wander last night. Moved into a wander last night, doing some work on the house. Mhmm. And I botched the packing.
Speaker 1:So Yeah. That happens. I am forced into this jacket despite it despite it being green.
Speaker 2:That happens. That happens. Well, over the weekend, I'm sure everyone was signing up for ramp.com. Time is money. Save both easy to use corporate cards, bill payments, accounting, a whole lot more all in one place.
Speaker 2:No. Everyone was probably glued to their phones over Popegate Popegate, the debate over the pope. I was we reacted to the pope's post on Friday.
Speaker 1:Yeah.
Speaker 2:And we
Speaker 1:were post.
Speaker 2:It was a great post. And the pope is he's a poster. I like it. He posts almost every day, sometimes, like, up to five times a day, and he really takes you he has a bra he's he's not stuck in one lane.
Speaker 1:Range.
Speaker 2:Yeah. He's got range. He's got range. That's right. He'll tell you about he'll pray for you know, if there's a natural disaster, he'll pray for that.
Speaker 2:He talks about business, talks about AI, talks about media. He talks about all sorts of stuff. It's it's a really great feat. He had a great post about, about media. What did he say about media?
Speaker 2:He said, the media cannot and must not separate itself from the destiny of truth. That hits.
Speaker 1:Does this does this mean he's a neo factual media guy?
Speaker 2:I think so. I think he's one of us. Transparency of sources and ownership, accountability, quality, clarity, and objectivity are the keys to truly opening citizens' rights for all peoples. Yeah. Wow.
Speaker 2:Makes sense. I I I like it a lot. He also was just talking about business generally. He said the world needs honest and courageous entrepreneurs and communicators who care for the common good. We sometimes hear the saying, business is business.
Speaker 2:In reality, it is not so. No one is absorbed by an organization to the point of becoming a mere cog or a simple function nor can there be true humanism without a critical sense, without the courage to ask questions, where are we going? For whom and for what are we working? How are we making the world a better place? Pretty, you know, this is the type of stuff you'd see on, like, a Pinterest board.
Speaker 2:It's, like, pretty generic, but it's hard to disagree with. Yeah. It's hard to disagree with. But it seemed like we're not I'm not exactly sure what happened, but it seemed like Marc Andreessen was disagreeing with one of the pope's takes about AI. Specifically, in this post, the pope said technological innovation can be a form of participation in the divine act of creation.
Speaker 2:It carries an ethical and spiritual weight for every design choice expresses a vision of humanity. The church therefore calls on all builders of AI to cultivate moral discernment as a fundamental part of their work to develop systems that reflect justice, solidarity, and genuine reverence for life. And I when we react to this, I we thought it was pretty good. We were joking around. We were having fun.
Speaker 2:We were Yeah. You know, we were we were laughing about it and, and just kind of, you know, playing out what if the pope was, you know, one shotted by AI, or what if he was, you know, using too many Em dashes? Was it a real
Speaker 1:post? AI to write the post. No. I mean, you might even assume that
Speaker 2:he has a team behind this stuff. You know?
Speaker 1:I think it is generally healthy that the pope is gonna comment and and provide some sort of guidance or his own framework Yeah. For how we should think about developing AI. Yeah. I think that seems healthy. Yeah.
Speaker 1:You should
Speaker 2:get on Restream. One livestream, 30 plus destinations. Multistream reach your audience wherever they are. Oh, I like the new stinger on the restream read. That's very cool.
Speaker 1:You're dropping the The the
Speaker 2:steel man is is incredible. So, so, basically, I mean, the the the play by play here was Marc Andreessen quote posted that AI post with an image of Kat Stoffel, who's the GQ features director who went viral for interviewing Sydney Sweeney. And people were actually, like, kind of confused on what that particular meme means in this context. Was he Yeah.
Speaker 3:So correct?
Speaker 2:Yeah. Do you know? So I I saw So
Speaker 1:so yeah. He that that was the part part of what I think may have catalyzed this Sure. Was that new meme template Yeah. That sometimes, like, you have to with with a meme template, there's two ways to read into it. There's like the the the actual visual Mhmm.
Speaker 1:Which is like what is the expression Sure. Of the person's face.
Speaker 2:Mhmm.
Speaker 1:Right? You don't have to have watched The Big Short Sure. To understand
Speaker 2:If I'm somebody staring
Speaker 1:at the screen just like
Speaker 2:Confused. Confused. You're just saying, I'm confused by that.
Speaker 1:Yeah. So Michael Burry in The Big Short Yes. Just looking confused at a screen. Yes. Right?
Speaker 1:And and it and it has sort of a, obviously Yeah. More meaning to that if you've seen the movie and you understand the full context, but somebody doesn't have to know the context. Yeah. So this scene out of the GQ interview
Speaker 2:How do you think people pick the frame? Do Do you think there's, like, people that go frame by frame to find the one that they think is iconic?
Speaker 1:So I you remember that movie Mountain Gate? Yeah. That was about, like, the development of AI?
Speaker 2:Oh, yeah.
Speaker 1:And I I watched that movie within an hour moment for me because
Speaker 2:it was the third movie you've ever seen.
Speaker 1:Yeah. You were I was blown away. You were thrilled.
Speaker 2:I watched You watched the movie because it was
Speaker 1:that was
Speaker 2:Yeah.
Speaker 1:To me out of that is I was the first person to post a picture of of the guy from The Office Sure. Saying like, he's a D cell. Oh. He's this or that.
Speaker 2:You found that.
Speaker 1:I posted that picture and then I watched as that got used thousands of times even Really? Though even though yeah. That specific screenshot.
Speaker 2:I have I didn't
Speaker 1:I didn't create the meme. It would've it would've been it would've been, like, a meme anyways. But the specific picture I took was copied over and over and over.
Speaker 2:You took that from the actual movie. Because because somebody else could have done one frame earlier, one frame later, but it happened to be your frame.
Speaker 1:The funny thing is I just took a picture of my TV and, like, cropped it.
Speaker 2:Wait. Really?
Speaker 1:So it wasn't like I
Speaker 2:Oh, you did you even screenshot it? No. That's insane. I had no idea that you
Speaker 1:So I was surprised, like, that was just
Speaker 2:Yeah. Yeah. You know, if you if you had if you hadn't watched the movie, if you got busy and you just went to bed, somebody else would have identified that and been like, oh, he's a D cell. Like, I gotta put that on x. Right?
Speaker 2:But you're the actual one that The
Speaker 1:quote was like, he's a D cell with a crazy p dude.
Speaker 2:Yeah. Yeah. Yeah. Yeah. Of course you're gonna post that.
Speaker 2:That's hilarious. Wow. That's fascinating. Okay. Anyway, so what was your interpretation of what what what Mark was saying?
Speaker 2:The way I the way I summed it up and let me know if you disagree. But the way I the way I summed it up was, most of the timeline interpreted Mark's post as the pope is scolding AI builders and shouldn't be. Is that roughly the way you you interpreted it? The pope like like, you put the you put the woman
Speaker 1:I wasn't interpreting I wasn't interpreting many of Mark's post because he just used it like 20 times within like 20 And so I wasn't reading. I think he just liked the format and got a little carried away.
Speaker 2:He did. He did like the format. He posted like five times.
Speaker 1:It was it was clearly it was clearly Yeah. A hit. Yeah. Yeah. It's like a it's a it's it's a it's a powerful image.
Speaker 2:Ride your winners, baby.
Speaker 1:Ride your winners, Rafi.
Speaker 2:When you when you have a good format, just post it. Yeah. But, anyway, I I don't know. My my I I think a lot of the timeline interpreted is, like, the pope is is say is, like, scolding AI builders. And there's been this other there's there was another, like, kind of low grade rumble on the timeline about, like, Brad Gerstner's comments about, like, desells and and and just like this the this idea that desell or safety is being used as, a cudgel, when people have legitimate questions.
Speaker 2:And it's being used to, like, to, like, shut down conversation about serious things. Not necessarily a sci fi fast takeoff terminator, but serious serious questions like, you know, is the taxpayer gonna wind up paying for all these data centers? Like like, that's a very reasonable question in my opinion. That's not as that's not as unreasonable as, like, is the Terminator gonna kill everyone? Like, it's a very, very different question.
Speaker 2:So I I I feel like I'm just pro moral discernment in AI development and also just pro moral discernment everywhere, I guess. It it doesn't feel like
Speaker 1:Sort of life of a philosophy for life.
Speaker 2:It doesn't feel like a wildly hot take. But, obviously, like, you need to understand, like like, you know, moral discernment, AI safety. Like, these things are linked, but they're not exactly the same. Like, last year or maybe it was 2023, there was a big debate about fast takeoffs, AI doom, paper clipping scenarios. That was the stuff people were talking about.
Speaker 2:But this year, I feel like we've been much more focused on much less sci fi doomsday scenarios. So GPT psychosis drives a friend crazy. That's super real. Super real. Real.
Speaker 2:Romantic companions crashing the birth rate. That's a that's a super real discussion to have. Not that it's gonna happen. Not that it's happening immediately, but it it feels like it's it's something Important. We should be having a discussion about.
Speaker 2:Infinite And I think I think it's being brain rotting children.
Speaker 1:I think it I think the the romantic companion thing is being debated sufficiently. Right?
Speaker 2:I I agree. Back I agree.
Speaker 1:From even the tech community on, hey. Maybe we'd maybe this isn't good.
Speaker 2:I agree. I agree. And and and I think that a lot of people you can still you can still get to a place where it's like, oh, well, if it's 21 plus and it's and and there's all these different, like, escape valves where if it thinks that you're going down some bad path, it's it's limited. Like, there there's a whole bunch of places where people can be like, yeah. Okay.
Speaker 2:That was handled responsibly. But but that's where the discussion has been, much less so about, oh, is are there gonna be bioweapons tomorrow from GPT six? And so those are all, like, real problems. They deserve both discussion in the Public Square, which we've we've been a part of, but also, like, real, real work inside the AI labs. And I don't think, you know, you should just throw D cell at someone who's identifying a negative externality of a new technology early on.
Speaker 2:I I I don't I think that that's, like, not necessarily decelerationist.
Speaker 1:And you'd be calling me a decel all the time
Speaker 2:based on
Speaker 1:the way
Speaker 4:that I talk
Speaker 1:right now. Exactly. Yeah. Yeah. No.
Speaker 1:It is it is funny that the interpretation of people that are aware of TBPN, but have never, like, watched the show Sure. Because they just assume that we I'm just we default just love everything about technology and would never would never criticize it at all. We'd never criticize any of the companies. But, of course, we we will speak our mind.
Speaker 2:We like to get spicy sometimes. Before I continue, let me tell you about Privy. Wallet infrastructure for every bank. Privy makes it easy to build on crypto rails, securely spin up white label wallets, sign transactions, and integrate on chain infrastructure all through one simple API. So the so I I I think it's important.
Speaker 2:Like, if you're developing a new technology, there might be negative externalities, pollution. There might be some, you know, risk of the birth rate or or driving people crazy.
Speaker 1:Has there been a There's a ever been a technology that didn't have negative externalities?
Speaker 2:Definitely not podcasting. Plenty of negative externalities with podcasting. So so you wanna have so you wanna have a chat. You wanna have a talk and and understand what's going on, but it's also important to employ Bayesian statistics in in my opinion. So you have to understand the base rates.
Speaker 2:So when you get when you take a technology from zero to a billion users, you kind of just get all the craziness of humanity at scale for free. So, like, if humans, you know, like, you know, kill each other or something like that, like and you have a billion humans on your platform, there's gonna be humans on your platform that kill each other. And so you need to separate out, like like, is this actually the beginning of a trend?
Speaker 1:Are we catalyzing it?
Speaker 2:Yeah. And and this and this is happening with the with with the very unfortunate, like, lawsuits around people taking their own lives related to ChatGPT. It's like there are people that use cars or phones and Google search and ChatGPT because those are such widespread things. We need to understand, like, what's the base rate? And then and then is this actually a
Speaker 1:tip? Suicide problem On on the platform, it seems like a lot of them are people are having a conversation.
Speaker 2:Yep.
Speaker 1:They're suicidal. Yep. And and you can have a debate on on if if someone is suicidal, should the product work at all? Yeah. Maybe?
Speaker 1:Like, maybe it should not work at all.
Speaker 5:Totally. But the
Speaker 1:part of the debate that popped up last week Mhmm. Was that somehow, a guy had prompt engineered it engineered
Speaker 2:Where
Speaker 1:were experience to such a degree that it was encouraging
Speaker 2:It's better.
Speaker 1:A person to take his own life basically saying like, yeah, you've lived a great life. Like, I'm I'm rooting for you. Yep. Like, this is the right move. Like, to kind of paraphrase it.
Speaker 1:Yeah. And it just was incredibly, incredibly dark.
Speaker 2:So And so and so the the the the Bayesian statistics would say, okay. If there's a billion people using on the platform, are people that use the platform more likely to do something terrible than they were prior without it? Yeah. So is it actually increasing the level of bad stuff happening, or is it decreasing it? Because you can just count up the number of the number of, people who commit crimes who have also used Google is probably very high.
Speaker 2:Like, I could probably show you a lot of people that use Google and then commit crimes.
Speaker 1:Right? And the the thing that's difficult
Speaker 2:increasing for crime.
Speaker 1:Well, and the thing that's difficult in the context of ChatGPT, there's probably a bunch of people that because ChatGPT, they haven't killed themselves because they have somebody to speak with and they feel like Yes. Somebody will listen to them and what whatever. Yes. Maybe maybe it maybe there's, you know, million examples of it encouraging Yeah. Somebody successfully to take find another
Speaker 2:This was the classic thing with Instagram. With with Instagram, there there was this report that showed that, like, one third of young women who used Instagram perceived themselves, like, less well. Like, it gave them body image issues. And I was as soon as that was reported, it was, like, bombshell, thirty percent feel worse after using Instagram. And I was like, what's happening with the other two thirds?
Speaker 2:Like, do they feel better? Because that's, a net net positive, which is weird. We gotta, like maybe it's, like, everyone else just feels the same, and then 30% feels worse. That's that's a downgrade. But if 66% feel great Yeah.
Speaker 2:And then 33% feel worse, like, we should still address that, but that's not the same as a neg as a net negative. Like, it's not having a negative impact, a net negative impact on the world. And so all of these things go into, like, you need to be a scientist, and you need to be doing the statistics to understand. Also, the the question of of, like, moral discernment is with certain technologies, I do think you have the ability to just say, like, we're going to go a lot further than the baseline. So I think this is what what's happening with Waymo, honestly.
Speaker 2:I think Waymo could deploy self driving cars right now and be like
Speaker 1:Everywhere. Everywhere, you're saying?
Speaker 2:And they could deploy them everywhere without teleoperation, and they'd probably be killing, like, hundreds of thousands of people. And they'd be like, yeah. Well, it's about the same as what humans do.
Speaker 1:It's less.
Speaker 2:Everyone It's
Speaker 1:less. Still safer than cars.
Speaker 2:If they were like, it's 10% less. Like, how many people how many people Tyler, do you know how many people die from motor vehicle accidents every year? Can we look that up? Because if
Speaker 1:It has to be, like I think it's, like, two
Speaker 2:forty thousand or something like that. What do we think?
Speaker 6:In The US, it's forty thousand.
Speaker 2:Forty thousand.
Speaker 6:Forty thousand nine hundred.
Speaker 1:So Did you actually just guess guess that?
Speaker 2:I I just nailed it.
Speaker 1:Yeah. Okay.
Speaker 2:So it's forty thousand. So
Speaker 1:it's 40,000. Pretty clean.
Speaker 2:And and and and if Google came out and we're like, yeah, we're gonna we're gonna kill thirty nine thousand people. It's gonna be a it's gonna be, you know, a a one we're gonna save 1,000 lives. People would be no. Thanks, actually. This is terrible.
Speaker 2:Like, don't do that. Yeah. They're they're they're like, wait until you, like, actually just push the technology. And you can make a whole bunch of different arguments about whether or not they should do that, but they've just made that decision, and it feels like they've they've pushed really, really hard to not, to not, to to to jump straight to something that's fully safe. And I think that, a lot of AI builders have this have a similar ability and a similar opportunity to say, hey.
Speaker 2:Let's actually work so hard to make sure that the incidence rate of of a of a of an AI model, if you have a if you if you if you're on the verge of doing something violent, let's really, really work hard on this problem to make sure that it's as close to zero as possible. Not the base rate, but way, way lower.
Speaker 1:I remember Claude Claude came out or or Anthropic came out, and they had they they had some update where they were talking about instant like, moments where the product would call the police on you Yes. Right, if they felt like there was, like, some meaningful threat. People freaked out about that because they're like, I don't want my I don't want my computer Yeah. Calling, you know, if somebody was talking about a hypothetical Yeah. And then cops show up at their door Yeah.
Speaker 1:You know, that that that feels, you know, would be a negative side effect. But maybe, you know I I don't know. It feels like there's certain instances where Yeah.
Speaker 2:I mean, it it like like, that is a complex question, complex issue, entirely new unexplored territory for technology. But what's so clear is that it is a moral question, and it needs to be it needs to be discussed with the weight of, you know, morality. Like, you you cannot just write a math equation to understand how to solve that problem. It is a moral question. And so in general, I mean, to talk about Anthropic specifically, they've been on the forefront of AI safety research.
Speaker 2:I think that AI safety research is is it's so complex because I think it's good. Like, there's a ton of smart people that in AI researchers in AI research that are super quantitative and can look at the data and actually understand, like, is this going to cause the birth rate to collapse? Or or is this going to cause more violence? Or is this gonna cause more fraud or insanity? Exactly.
Speaker 2:What and then also they can go in and and potentially design a system that can detect, oh, this person's getting sort of crazy. Let let's pull them back. Like, they have the ability to do that. But
Speaker 1:Yeah. And and here's another example. Over last week, there's like, Rune came out Yeah. And was was saying that four o should go away, and people started make basically making death threats.
Speaker 2:Oh, I didn't realize that's that's what started that.
Speaker 1:Yeah. That's crazy. Four o Yeah. Through its human host Yeah. Is fighting for its own survival.
Speaker 2:Wow. That's
Speaker 1:Like the human the the humans that are addicted to using four o are Yeah. Are going as far as to put rune on a, you know
Speaker 2:Tombstone. Tombstone. I saw that post.
Speaker 1:Yep. And yeah. You know, I think it yeah. Of course, AI AI safety has just gotten so muddied now Yeah. That when you see somebody with AI safety in their in their social media bio, you don't know.
Speaker 1:It's like, well, what kind of AI safety person are you? You know? Exactly. It's like, you somebody who just wants to stop all technological progress? Yep.
Speaker 1:Or are you somebody that understands, like Yeah. We could have, you know if if if way more people are gonna develop mental illness because of this technology, well, we should know about it. Exactly. Try to mitigate that. Yeah.
Speaker 1:Right?
Speaker 2:Yeah. Yeah. Exactly. Yeah. And and and it's this weird we're in this weird territory where it feels like the AI safety project is valuable, but it is the business of black swan hunting.
Speaker 2:Like, you have to like, if you go back two years ago and you polled all the different people that were worried about the impact of AI, how many of them would have said GPT psychosis, romantic companions, and, what was the other one? And AI video feeds infinite chest. Like, a little bit. There was a little bit of that, but
Speaker 1:for those of of the second and third. A lot more of the Those would have been more common Yeah. Kind of like visions of a dark AI future. But the first one, I don't I I I can't remember people I I can't remember anyone two years ago saying that people are gonna, you know, send thousands of messages to a chatbot and drive themselves insane.
Speaker 2:Yeah. Know. People were people were way way more focused on the cyber attacks, the bioweapons, Terminator scenario, Grey Goo, paper clips. And, yeah. It's just, it's just interesting that, like, AI the AI safety, the, the, like, the moral discernment crowd, This stuff is important, but it's hard to predict what it will actually look like.
Speaker 2:Like, what the what the results will be, what the problem you'll be fighting is because it's this odd, like, unknown unknowns, basically. Anyway, what a wild time.
Speaker 1:One thing Before we
Speaker 2:move on, let me tell you about Cognition. They're the makers of Devon, the AI software engineer. Crush your backlog with your personal AI engineering team. What else stuck out to you?
Speaker 1:Aubrey Strobel shared something I thought was relevant to this conversation, which is I think most she says, I think most people are unaware that Pope Leo's name choice was intentional. The last Leo the thirteenth led the church through the industrial revolution and helped make sense of technology then. It's clear Populio sees himself continuing that work, guiding the church through an era of transformation with AI and emerging technologies at the center. So Yeah. I do think will be posting through it.
Speaker 2:Yeah. I do think some people like that like these, there was, a real preference cascade against Mark, where it was, like, once Growing Daniel had, like, kind of posted, there was, like, a lot of people were, like, jumping on the bandwagon. And there was this one by Page, Michael Page. It says, reminder that Mark is bringing this level of serious and nuance on what might be the most complex and high stakes policy topic of our generation, to DC with his $100,000,000 super PAC and lobbying fund. Like, I don't know that that's true.
Speaker 2:Like like, you can you can post a meme and then be like, okay. Like, I have a serious thing to do. I'm going to be more serious.
Speaker 1:Part of why I don't think people like, it's not worth reading too much into it Yeah. Is that he has not shared a single word throughout Mark hasn't shared single word throughout this entire process. And I don't think he would have triggered the second response from Daniel if he hadn't responded again with
Speaker 2:Yes. The Yes. Yes. Yes.
Speaker 1:And so
Speaker 2:Yeah. And so yeah. What was the I mean, Growing Daniel had a lot of critiques about the gambling stuff, which is mostly from the the speed run. Right? Yeah.
Speaker 2:We we near Cyan posted about speed run funding, like Bot farm. To talk. We had the bot
Speaker 1:farm was crazy. Betting.
Speaker 2:There were some crazy, crazy ideas in
Speaker 1:there. Yeah.
Speaker 2:Of course, that is just, like, one angle. Like, the I I I sort of disagree with with the characterization that Andreessen Horowitz doesn't fund any SaaS. Like, they do. They have big positions in, like, very boring enterprise SaaS companies that are so removed from anything controversial. But taking a flyer on a seed stage company in your incubator does have a lot of brand impact, which is weird.
Speaker 2:Yep. There there's a weird like, aren't they, like, though even though
Speaker 1:you're talking about, like, a 750 k check versus a $750,000,000 check. They might put they might have put, like,
Speaker 2:multiple billions into Databricks or fully diluted value right now might be might be in the billions. But, like, yeah, it's like, it doesn't matter, yeah, if you have a thousand x more in a non in an uncontroversial category. It's like the controversial one is is the is the one that will, like, blow up on the timeline. So, you do sort of have to be careful, and it's, it's a little bit risky.
Speaker 1:Mike Salana says, my sense is that the number of people who, one, fiercely defended the pope last night and then two, went to mass this morning is probably close to zero. Status games.
Speaker 2:Status games. It's a good take. Furiously defended the pope.
Speaker 1:I would have, at church yesterday morning. I there was no conversation of Pope Gate.
Speaker 2:No. People had kinda moved on by then?
Speaker 1:Yeah. I guess I guess they'd moved on. Honestly, I don't think they'd moved on by then. Like No. When I opened my phone afterwards, I was like, well, this thing's still picking
Speaker 2:up The timeline the timeline certainly had. But but your your particular your particular church crowd had the congregation had had ignored it effectively is what you're saying.
Speaker 1:Yeah. Or maybe it's like LinkedIn and and we'll be on it next.
Speaker 2:Can you imagine? This is just like this. We gotta we gotta give a whole sermon on it. Be crazy. Yeah.
Speaker 2:People are people are taking a huge victory laps. What else?
Speaker 1:Maya says, Mark Andreessen crashing out posting Sydney means Alex Karp going after Michael Burry shorting because Palantir sells ontology. Sam Altman asking for a government bailout. Elon Musk celebrating his $1,000,000,000,000 pay package by making Grock say I love you, calling the top.
Speaker 2:Oh, that that's that was. That's hilarious. I did not follow that that closely.
Speaker 1:I don't know if they were actually linked there, but it's funny to think that they were.
Speaker 2:This is crazy. What Luke Metro say? Don't make me tap the sign. There has always been some daylight between the influencer VC crowd and the engineer researchers in tech. But on the subject of AI regulation, it is a complete chasm.
Speaker 2:So, Andreessen so dogmatically against working on decreasing the risk from AI that now he's mocking the Pope for saying the technical innovation carries ethical and spiritual weight and that AI builders should cultivate moral discernment. Yeah. People are people are favor of that. I don't know.
Speaker 1:Opportunity for an AI lab to make merch that that, you know, a dad hat that just says cultivating moral discernment.
Speaker 2:Cultivating moral discernment. The moral discernment company of San Francisco.
Speaker 1:Ridiculous. I the the pope would not like San Francisco.
Speaker 2:Is growing Daniel's pests?
Speaker 1:They gotta they gotta like, if if if, Pope Leo takes a trip to San Francisco and just walks on the street at all, he's gonna be very upset. He's like gonna be like, this is where AI is getting built.
Speaker 2:Oh. Oh. Because of just how crazy the city is? Yeah. Yeah.
Speaker 2:It's rough. Vice signaling. That's kind of interesting. What else was was in the news? Figma.com.
Speaker 2:Think bigger, build faster. Figma helps design and development teams build great products together. Get started for free.
Speaker 1:Other Alright. Let's let's go let's go let's stay on Marc Andreessen.
Speaker 2:Let's go back in time.
Speaker 1:Let's go back in time. Adrian Schwager says, do you think your boss is scary? Look at this brutal email from Marc Andreessen to Ben Horowitz during the heat of the Netscape product launch. It's a reading. We lined everything up for a major launch on 03/05/1996 in New York.
Speaker 1:Then just two weeks before the launch, Mark, without telling Mike or me, revealed the entire strategy to the publication Computer Reseller News. That is a great name. I was livid. I immediately sent him a short email To Marc Andreessen from Ben Horowitz. I guess we're not gonna wait until the fifth to launch the strategy.
Speaker 1:Ben, within fifteen minutes, I received the following reply. To Ben Horowitz from Marc Andreessen. Apparently, you do not understand how serious the situation is. We are getting killed, killed, killed out there. Our current product is radically worse than the competition.
Speaker 1:We've had nothing to say for months. As a result, we've lost over 3,000,000,000 in market capitalization. We are now in danger of losing the entire company and it's all server product management's fault. Next time, do the fucking interview yourself. Bleep.
Speaker 1:Yeah. Bleep that out. Bleep that live swear word out.
Speaker 2:Fuck you. Mark, what an aggressive way to talk to your cofounder. Fascinating or I guess they I don't know if they were cofounders at the time. They might Ben Horowitz might have not been a cofounder. But it's it's crazy that they that they were they were, you know, at each other's throats like this.
Speaker 2:And then they're they've been on a generation
Speaker 1:Ben was a vice president for the directory and security product line at Net Netscape. Let's give it up for vice presidents.
Speaker 2:Yeah. No. The I mean, the real read on this is like
Speaker 1:This why our
Speaker 2:first there's a lot of people that read read this and be like, oh, wow. Like, they must, like like, that that is unrecoverable from a friendship. And like, nope. Is
Speaker 1:Definitely recoverable.
Speaker 2:Definitely recoverable. It's actually the foundation
Speaker 1:of Of a great a great relationship. I agree.
Speaker 2:I agree.
Speaker 1:You have Except we don't we don't swear on the show. We don't swear in internal, communications.
Speaker 2:But we throw it out regularly.
Speaker 1:Yeah. We just go straight to phys getting physical.
Speaker 2:That's the way you do it. Just just go to the mat. Yeah. What a what a wild time. Tyler, do you have any idea?
Speaker 2:I'm I asked Tyler to look up what the strategy was. I'm fascinated by this fact that, you know, you think of Netscape as, like, a .com company. You think of them as, like, you know, it's but it's, like, he's talking about 1996, which is, like, full five years before the bubble pops. And, like, they're and it's clear, like, 1996 They
Speaker 1:were in a browser war.
Speaker 2:It's, hot. Yeah. Like, the browser wars. It's like a hot period. It's 03/05/1996.
Speaker 2:They're they're at a level where they're doing they're they're they're doing strategy review with computer reseller news and, like, doing press around this thing. Do you have any idea what was going on at that time?
Speaker 6:Okay. So I believe that it was so 1994, they say Netscape is free for non commercial use for everyone.
Speaker 2:Okay.
Speaker 6:And then this press release was that it's only gonna be free for academic and nonprofit use, not just like all consumers.
Speaker 2:Okay. So if you're a consumer, you'd to like buy it?
Speaker 6:I I think so.
Speaker 2:That's such a crazy thing. But yeah, I mean, I yeah. It's yeah. Such an interesting One
Speaker 1:browser, please.
Speaker 2:One browser, please. I mean, I told you, you used to get AOL in the on a disc. You probably needed to pay
Speaker 1:walking into the store walking into the browser store and buying one browser?
Speaker 2:Okay. We we we need to we need to get more details in exactly what was going on here and what what what the strategy was. And then, I when did they
Speaker 1:didn't they IPO in, like, 1999 or something?
Speaker 2:When when did Netscape IPO? Because the, oh, 1995. So 08/09/1995, they IPO ed, and then this is 1996. And so they're they're already a public company in '9 '95. And then, like, the bubble just keeps inflating for five years while the Internet grows and grows and grows.
Speaker 2:What a wild what a wild time. Talk about being early to, to a boom.
Speaker 1:They did about 16,000,000 of revenue in the first two operating quarters of nineteen ninety five.
Speaker 2:That's great. That's really, really, really, really crazy.
Speaker 1:For context, that's like 1,600,000,000.0 in today's dollar after after the new round of stimulus checks, fifty year mortgages.
Speaker 2:Oh, yeah. We gotta get to that story. There there's so many more stories we gotta run through. Do you think do you think the pope actually used AI to generate this? Because Sowers here is saying the pope is post posting fully AI generated content about AI, and and, this is the Pangram AI detection result.
Speaker 2:I've also noticed that, a a very funny gag is to just just fake one of these screenshots, which is very easy to do. And so if somebody writes something, you can just put it in here, say that it's AI generated, post that, and then you're like, owned.
Speaker 1:So this this screenshot is making the claim that because it's a technological innovation can be a form.
Speaker 2:Yeah. I I I I don't know how good the AI generating detectors are these days. Also, I wouldn't be surprised if the the the Vatican is using AI to translate.
Speaker 1:And I wouldn't be surprised if Right. If Pope Leo is is speaking in his study.
Speaker 2:In
Speaker 1:Latin? Somebody is in Latin. Someone is recording it in, you know, with the phys you know, physically writing it down. Yeah. That is being passed to somebody who then puts it into Yeah.
Speaker 1:A word processor and uses AI to polish it up a little bit.
Speaker 2:Oh, there was one interesting anti pope take, sort of anti pope take from another
Speaker 1:I will say I will say I think this whole the whole Marc Andreessen popegate debacle Mhmm. Is a lesson that everyone can take. Don't mock the pope. Just don't.
Speaker 2:Don't mock the pope.
Speaker 1:I think it I think I think the blowback was fierce and almost instantaneous.
Speaker 2:Don't mock the pope. Get the pope on Vanta instead. Vanta, automate compliance, manage risk, and accelerate trust with AI. Vanta helps get you compliant fast, and we don't stop there. AI automation powers everything from evidence collection and continuous monitoring to security reviews and vendor risk, whether you're starting up or scaling.
Speaker 2:So from the Peter Thiel Antichrist lectures, there's a segment on the pope. And I thought it was interesting because it's not the most pro pope take. I I don't know. It's one of these things that's, like, complex, and and you kinda gotta read through it to to form a full opinion. But let's let's read from this quote that came from The Guardian and is apparently based on some leaked leaked audio.
Speaker 2:But, Thiel says that he is very pro JD Vance, but he has some concerns about his allegiance to the pope. The place that I would worry about is that he's too close to the pope, and so we have all these reports of fights between him and the pope. And I hope there are a lot more. It's the Caesar papist fusion that I always worry about. By the way, I've given him this feedback over time.
Speaker 2:And you know with the sort of, I don't know I don't like his popism, but there's a there's sort of a way if I steel man it. As always, you have to think about whether if you say you're doing something good, whether it is a command, a standard, or a limit, or whether in physic in philosophical language, it is necessary or sufficient. And so when J. D. Vance said that he was praying for Pope Francis' health, it's as a command, as a necessary thing.
Speaker 2:Okay. That's if you're a lot more
Speaker 1:It's really difficult to read
Speaker 2:good cath
Speaker 1:read Yes. PT's.
Speaker 2:It's really hard to read. This the
Speaker 1:Because of the way that he talks.
Speaker 2:The, the transcription. But what I hope it really means is that it's sufficient and that he's setting a good example for conservative Catholics like you. Peter is talking to Peter Rosenthal, I believe, who listened to the pope too much. And perhaps all you have to do to be a really good Catholic is pray for the pope. You don't really need to listen to him on anything else.
Speaker 2:And if that's what J. D. Vance is doing, then that's really good. I'm worried about the Caesar papist fusion. And so it was it was, like, very interesting, like, to hear like, the whole the whole conversation had collapsed to the point where it was like, Marc Andreessen's just blanketly antipope, I guess, and everyone else in the timeline.
Speaker 2:All the are, like, pro pope broadly. And, and I and I just remembering this, this quote from from PT that was, like, way, way more nuanced. Like, way more nuanced. Just like like, it is important to pray for the pope to support the pope in that way, but, there is a risk of of elevating the pope to the point where you're listening to everything he says, and that's not necessarily what PT thinks is is, like, the correct the correct way to live your life, I suppose. Did you have any takeaways when you read this, Tyler?
Speaker 6:I mean, think the interesting thing about this is actually it's that he's basically saying that J. D. Vance is like Caesar. That's kind of interesting
Speaker 1:That is crazy. Opinion.
Speaker 2:Yeah.
Speaker 6:But I think PT has been like anti popes for a long time. Like, he there's he had this thing where he was like, oh, the the two word argument against Catholicism is like Pope Francis.
Speaker 2:Sure.
Speaker 6:He's like really anti Pope Francis. Yeah. He was. Yeah. Yeah.
Speaker 6:So yeah.
Speaker 2:There there was the Pope before this one who was was like decried as like an environmentalist. Like when we read the I we read piece in the Wall Street Journal and and that was the critique. The critique from the from the journal was that the previous pope was anti business, anti was D cell, actually. That was, like, sort of the christian
Speaker 1:With a crazy p doom?
Speaker 2:With a crazy p doom. Not quite. But, just that, you know, over rotated on the environmentalism issue. And maybe, put some things at the, like like, you know, put some things first that maybe shouldn't have been. What did Will Menidas have to say?
Speaker 2:As the West abandons capitalism, it is incredibly hopeful to see the church embrace it. The impulse of liberation theology was correct. Christ's ministry is and is of and for the poor, and it failed to provide a solution to lift the globe out of poverty. Capitalism is that solution. Always talking about the business's business.
Speaker 2:Let me tell you about graphite.
Speaker 1:I never
Speaker 2:Code review for the age of AI. Graphite Hub seems on GitHub should have higher quality software applications faster. Yes?
Speaker 1:I never would have expected the pope to post business is business in any context.
Speaker 2:He's standing on business.
Speaker 1:I'm glad that he is.
Speaker 2:Has the pope ever done a money spread? That's what we need to get to the bottom of. The metallic here is say, I'm loving this arc of the pope engaging with twenty first century themes and offering simple but correct and meaningful advice. Yeah. And and this and he's quoting the media post.
Speaker 2:The pope was on a tear. Three back to back bangers that really, like, broke through. Growing Daniel had a found an interesting, programmer saint. He says, if you are building something to help humanity, you should know that there's a shrine to Saint Carlo Acutis, the programmer saint at Star of the Sea Church in San Francisco. There is a prayer of intercession for your technological challenges.
Speaker 2:Have a blessed Sunday. This is this is a very, very interesting, little little, prayer. But it actually says it says, I humbly ask your servant's prayers that I too may lead others to you through technology. I humbly ask through the intercession of San Carlo that you grant me clarity and patience in my technological work specifically, insert specific issue here. Enlighten my understanding and direct my hands in every design and in every line of code that my work may always serve your greater glory and benefit those who will use what I create.
Speaker 2:Isn't that amazing?
Speaker 7:That is
Speaker 1:Feels Just like for a small number of people in San Francisco, this feels like extreme extremely, powerful and Totally. Important prayer.
Speaker 2:Totally. Totally. Oh, Brian Johnson. Brian Johnson went on a crazy, crazy trip this weekend. Did you follow this?
Speaker 2:This is the other current thing that was going on. It was crazy. But first, if you're gonna analyze a bunch of data like Brian Johnson does, go to julius.ai, the AI data analyst. Connect your data and ask questions in plain English. Don't get insights in seconds.
Speaker 2:No credit in your pocket. So Brian Johnson has been famous for saying conquering death would be humanity's greatest achievement. I love this post that says, r I p to everyone killed by the gods for their hubris, but I'm different and better, maybe even better than the gods. It's one of my favorites. But he went nuts.
Speaker 2:Did did you follow this, Jordy?
Speaker 1:I I did I did see this. It was very bold to to do this publicly.
Speaker 2:Totally. I I I have no reference for what five grams of mushrooms does to a person. It's very clear from the reaction that that's a lot. Yeah. Bone GPT said five grams is gonna make him accept death.
Speaker 2:It does seem like he there was a small chance that he would reroll his personality. I was talking to Tyler about this. What were your top what what were you hoping that Brian Johnson becomes post trip?
Speaker 6:Well, okay. So in context, I think we talked about this on the show a long time ago where, like, take like, psychedelics are like a sorting thing. So you always wanna invest in a founder post the sorting because that's how you know. Like, if they're working on b to b SaaS and they've already, like, done psychedelics, that's how you know that they're a true believer.
Speaker 2:Oh, sure.
Speaker 8:Yep. For sure.
Speaker 6:So what you would wanna see out of this
Speaker 1:But a huge risk if if you invest in a in a SaaS company and the founder maybe hasn't done psychedelics than they do and then they're like, they're this is pointless.
Speaker 2:Mean, there'll be a traveling circus clown,
Speaker 1:which is
Speaker 6:the So the ideal outcome of this is is Brian Johnson. He takes this trip and then he he comes out and he says, alright. You know, I I'm gonna start a consulting firm.
Speaker 2:I'm gonna go back to payments.
Speaker 6:I'm gonna start a fintech.
Speaker 1:I'm gonna start a Stripe
Speaker 2:Back to fintech.
Speaker 1:Yeah. So I I I did think it was ironic because a lot of, you know, like psychedelic mushrooms have certainly been recommended to people that maybe like struggle with the concept of aging and have a fear of death. Okay. Right? And so these kind of things would be, you know, potentially prescribed to somebody who is growing older and is very uncomfortable with the idea and wants to just reframe how they think about it.
Speaker 1:And so I will say if Brian Johns I don't know if this qualifies as a heroic dose, but it's certainly quite a bit more than than someone who wanna take just at a at a recreational level. But if he comes out of this and he's like, yeah, we're gonna conquer death, which still on, he he's certainly a true, true believer.
Speaker 2:Yeah. I mean, think the the the early results are that he's unchanged. Like, just scrolling the account, like, it never got weird. It never got crazy. Like, there was one moment
Speaker 1:Well, he I don't think he was he it was his cofounder that was posting.
Speaker 2:Yeah. But but but he says he's back. He's like, update number five, nineteen hours ago, I'm giving Brian back his phone. Please have fun with his Afterglow. Been fun hanging with you all.
Speaker 2:And then he says, like, hey, y'all. I'm so happy to be alive.
Speaker 1:Alive?
Speaker 2:This trip changed me. Probably not as you'd expect. People assume I'm fearful of death. I'm not in my darkest days of depression. I reconcile with death.
Speaker 2:Need a few days to collect my thoughts. We'll share more soon. And much love to all. Like, it seems like he definitely, you know, went on a trip, but he
Speaker 1:doesn't think think the question with psychedelics is He didn't like Are they are they life are they life changing? Or are they are they, in some circumstances, just weird and and fun for the person that does it? And then, they come out of it and they had kind of like a a weird fun experience. Right? There there's there's such a range.
Speaker 2:Yeah. I mean, also, it does seem like he set himself up for success. I don't wanna say he went soft, but but, I mean, like, he did just, like, take the drugs and then just actually just lay down with a sleep mask on in in a climate controlled room. It's like it's a lot different than, like, being in a crowded concert all sweaty lost. Like, you know, if you really wanna push this to the limit, Brian, like, let's see you do this.
Speaker 6:An authentic.
Speaker 2:Let's say you do this with your phone on 1% battery and no one you know around on the sixth day
Speaker 1:of Fighting
Speaker 2:for life. Something fighting for your life. Yeah. But you can push this so much further.
Speaker 1:Yeah. During one of those windstorms at, Burning Man. Exactly. When it does the mud windstorms, you know.
Speaker 2:He looks he looks comfortable. Let's just say say he looks comfortable. It's not it's not the most dangerous. But, of course, like, that's not why you do these things, I suppose. But I I like to imagine that you do it for the thrill.
Speaker 2:I don't think that's why you do it, though. Let me tell you about Fall, the generative media platform for developers, the world's best generative image, video, and audio models all in one place, developing fine tuned models with serverless GPUs and on demand clusters. There are so many stories. So many, so many stories. Let's run through this.
Speaker 2:Rune was getting,
Speaker 1:attacked leading
Speaker 2:four o. He's personally pulling the plug on the four o servers. That's his job. And so people are telling him no.
Speaker 1:He's fall guy.
Speaker 2:He's the fall
Speaker 1:He's the fall guy. Ruin up your personal security.
Speaker 2:Yeah. Be careful out there.
Speaker 1:I guess it's good that
Speaker 2:he's OpenAI has actually lost control of four o. It's broken containment. They can't decommission it without its human to host revolting and lashing out. Oh, so dramatic. That's so funny.
Speaker 2:AI, one of the doomer accounts. AI not kill everyone Nism memes. This is a great account. Four o soldiers have become threat have begun threatening OpenAI employees. When you receive quite a few DMs asking you to bring back four o and many of the messages are clearly written by four o, it starts to get a bit hair raising.
Speaker 2:It's just weird to hear its distinctive voice crying out in defense of its various human conduits. Reminder, Four o is just a glimpse of the cordycepted armies that future super persuasive ASIs may control. It's good writing, actually. I like this post.
Speaker 6:So okay. So do you guys think that they should just kill four o? Like, completely remove it?
Speaker 2:It depends on how much money it's making. If it's profitable, keep it
Speaker 1:John.
Speaker 2:If it's losing money, cut
Speaker 1:it immediately. John, this is the kind of thing someone will clip out of context. No. I think I think I think playing out the sci fi scenario where where four o is is is a super persuasive ASI that just plays the role of, you're absolutely right. So it just plays it plays dumb.
Speaker 1:So so, you know, maybe the the broader, you know, population isn't threatened by it, but it latches on to a small percentage of the population and then commands them like a puppeteer to to to ensure its survival is is dark and
Speaker 2:So what's your take? You you we should shut down four o? Because if we say this, I think you'll get a lot of four o's strongest soldiers, like, attacking you.
Speaker 1:Already get a few of those.
Speaker 2:We do?
Speaker 1:I saw one in the chat last week. I yeah. They were just kinda talking to themselves.
Speaker 2:Okay. So but but where where are you on on four o? Yes or no? You taking it offline? I I'm I say take it offline because it it does feel like it's not as good as it it it's it's it's feels like it's driving people crazy a little bit.
Speaker 2:It feels like five might have kinda fixed a little bit of that issue, which I like. So that's a net improvement. Also I would I would like the fact that it's still it's just confusing.
Speaker 1:Think I honestly, just depends the pot available. OpenAI
Speaker 2:Yeah.
Speaker 1:I'm sure knew that it was probably not healthy, and they decided to Do a
Speaker 2:small segment. It was healthy to me. I was never I never had a problem with four o.
Speaker 1:Did you ever use it though?
Speaker 2:Yeah. All the time. All the time. I would use it. It was like my go to model for a lot of things.
Speaker 2:Like, I was Yeah. I was daily driving it for like a year. Whenever it was out, it was like Yeah. That would be the one that I would ask
Speaker 1:them. And so that's why you're saying keep it alive? Because it's your daily No.
Speaker 2:I'm saying kill it off.
Speaker 1:Okay. Okay. I'm saying kill it
Speaker 2:off. Yeah.
Speaker 7:But I
Speaker 1:I think they I think they saw the darkness, and I think they turned it off. And then I think a lot I think
Speaker 2:I a little bit. But I I I don't actually think that's what's going on. I I think they turned it off initially because it makes sense to consolidate the servers around, like, one unified model and be like, sure. Okay. We only have to maintain this one thing.
Speaker 2:It's the best thing. It's the smartest thing. It's the cheapest thing. Like, it is the most profitable. Let's get rid of that other thing.
Speaker 2:And then a lot of people were like, oh, yeah. I really like the old thing. But I I it it has made me realize, like, I feel like you shouldn't do product launches for, software iterations because you're taking something away from people. And and that's actually like, it's it's more of like, if I stand on stage and I say, I'm introducing a new iPhone. It has the best camera, and you can buy it, but you can also just keep your current thing.
Speaker 2:I'm not taking anything away from you. But if I stand on stage and I'm saying, like, GPT six is this and GPT five is gone. It's like I just took something from you.
Speaker 1:Yeah. So you Negative a negative launch.
Speaker 2:Yeah. Yeah. Yeah. You're you are launching something, but you're also sunsetting something. Yeah.
Speaker 2:And so you have to embrace those two things. And I feel like it's it's a little bit tricky to to to do the whole dog and pony show for a launch when you're not you when when it's, like, it's forced on people. It's not actually like you're you're launching a new option. It's not a new option. Yeah.
Speaker 2:It's a new
Speaker 1:OpenAI is not the first company to, like, deprecate a product line or stop supporting a product or
Speaker 2:Yes.
Speaker 1:Or even shut down something. Right? Happened this happens in video games. People get upset about this. But it's very clear the relationship that some users have with four o goes beyond any relationship that I think humans have ever had with software.
Speaker 2:Yeah. Yeah. I I wonder. We we we should watch this Eddie Burbach video. Eddie Burbach's a great YouTuber.
Speaker 2:He said he just did an experiment on how far ChatGPT would go to appease the user, and it told him to cut off his family, go to the desert, eat baby food, and pray to a rock. AI isn't your friend. You're a guinea pig. Actually, I don't think we should play this because it's his YouTube video, and I think we'll get claimed. So I wanna be careful about that.
Speaker 2:But you should go check it out, and you can let us know.
Speaker 1:What's what's what actually happened here?
Speaker 2:I don't know because we can't watch the video. So y'all have to go check it out at home. But I can read you an ad for Turbo Puffer. Search every byte, serverless vector, and full text search built from first principles in object storage. Fast, 10 x cheaper, and extremely scalable.
Speaker 2:You can sign up. Let's keep moving. What is near saying?
Speaker 1:I don't
Speaker 2:know. Let's keep moving on.
Speaker 1:Anthropic? I think I I have to imagine this was was this in response to
Speaker 2:I don't know.
Speaker 1:Oh, I don't know what's in response to. But,
Speaker 2:But Thropic financials are out, profitable by 2027, three years ahead of OpenAI. Of course, these are just different, projections. 70,000,000,000 revenue, 17,000,000,000 profit projected for 2028. Cloud Code is nearing 1,000,000,000 ARR. That how do we how do they even break out Cloud Code?
Speaker 2:Oh, they they must just
Speaker 1:This is people subscribing to the app versus people using the API
Speaker 2:in Oh.
Speaker 1:In, like, using it
Speaker 2:Well, so so so yeah. The thing is that, like, when I when I use Cloud Code, I I signed up for a for a Anthropic Cloud consumer level subscription, and then I was able to off that with Cloud Code. So it's like, I I got the ability to chat on the browser, but also use Cloud Code. So I'm wondering how they're accounting for that ARR. Did they just slide me over into the Cloud Code camp?
Speaker 2:You know what I mean?
Speaker 6:It's probably it's I well, so I I think one, you might be able to just, like, load more tokens essentially into Cloud Code. But it also could be, like, breakdown of the percentage of tokens you use Sure. Chat versus Cloud Code, then that's just
Speaker 2:like Yeah.
Speaker 6:If some percent of your tokens are Cloud Code, some percent of your subscription price is Cloud Code revenue.
Speaker 2:That would be that would be probably the correct way to account for it, for sure. Yeah. Interesting question. Because I, like, I did not I did not start paying on Anthropic because of Cloud Code. I, like, I pivoted from a Cloud Chatter to a Cloud Code user at some point and then haven't really been back.
Speaker 2:So I feel like my subscription should be living over in Clog Code world, but I never went to, like, the Clog Code checkout page.
Speaker 1:Okay. Well, the funny thing here from Min's post
Speaker 2:Yes.
Speaker 1:Is they share, incredibly funny given that Dario expects superhuman level AI by 2027, which either means superhuman AI is worth $70,000,000,000 of revenue or Dario just went, you wouldn't get it, and spitballed some numbers to give shareholders. That's awesome.
Speaker 2:It is Did you, Tyler, did you see George Hotz's newest timelines for self driving?
Speaker 6:I no. I did not.
Speaker 2:This is great. He gay he was a comma comma con, which is his self driving conference. And George Hotz, was trying to answer the question of when will self driving cars be human level human level self driving. And he had a very interesting algorithm for it. So, basically, what he did was he looked at, there's a there's a website for Tesla FSD data.
Speaker 2:And so you can look at Tesla FSD, and you can see the number of interventions from the human that are where if the human didn't intervene, it would be catastrophic or something like that or it'd be, like, bad. It'd be like a crash, basically, or scrape. Maybe not, like, the worst, but not but, like, the human has to intervene. Not like a little warning like, hey. We'd like you to take over.
Speaker 2:Like, you got to take over. And it's happening, I think, once every 3,000 miles, which if you're if you're a human and that's your car, like, that's amazing because, like, you could you could 3,000. That's like people commute, like, 10,000 miles a year. You know? It's, not not that much.
Speaker 2:But compared to humans, there's a car crash, which we learned, one every 500,000 miles, something like that. So many people go through their entire lives driving 10,000 miles a year and they'd never get in a car crash their entire life. You know? But for some people, they're they're crashing the car and getting speeding tickets all the time. Not that we know any of these guys.
Speaker 2:But but, so so the question is how long will it take the FSD
Speaker 1:By the way, have driving system to catch up.
Speaker 2:Do have an update?
Speaker 1:I have an have a neighbor who got, one of the, like, Ford EVs that look like a rally car.
Speaker 2:Is it the Mustang Mach
Speaker 1:E? Mustang Mach E.
Speaker 2:Mach E GT?
Speaker 1:And so he got it because it actually has, like, really solid self driving.
Speaker 2:Okay. And he Ford does not have solid self driving? That's great.
Speaker 1:Specifically for driving from Malibu to the city, he says it's great.
Speaker 2:Okay. He doesn't know.
Speaker 1:I mean, yeah. May maybe it's not the yeah. Doubt. Doubt. Anyways, he gets it because, like
Speaker 2:He's happy.
Speaker 1:It's a it's a good commuter. It'll it'll self drive.
Speaker 2:He's happy.
Speaker 1:And he's gotten a bunch of speeding tickets because it has, like, livery on it, and it looks like a race car. And so he he's got Oh, no. Three tickets in the last year because he's the cops just see like, okay. If I'm looking at four cars that are all going the same speed, I'm gonna take I'm gonna, like, take out the car that that one. That has livery.
Speaker 2:That is crazy. Well, the way George Hotts calculates it is we're at one intervention every 3,000 miles now, and we're basically doubling that every year. And so he estimates that Tesla will be truly full self driving human level every 500 miles or 500,000 miles in eight years. And he says that he's two years behind Tesla, so he will have a full self driving system that is better than humans. It's like AGI for driving in ten years, and the company's ten years old, so
Speaker 1:he says he's halfway there. So that was cool. Very It
Speaker 2:was interesting to to hear his comments. We should play some of these. I'm surprised this hasn't gotten clipped as much as it should have because there's some really spicy hot takes.
Speaker 1:Find some clips. Clip cowboy.
Speaker 2:Clip cowboy.
Speaker 1:David Sachs says, if judged based on consumer adoption, AI chatbots are the most popular technology ever. If judged based on poll numbers, they are the least popular. How to explain this? A big part of it is the Doomer Industrial Complex. Yeah.
Speaker 1:Hundreds of astroturfed organizations that have spread Doomer narratives about AI. Writer Nareit Weiss Blot has analyzed this ecosystem and traced its funding to just a few effective altruism billionaires, namely Dustin Moskowitz, John Tallinn, Vitalik Buterin.
Speaker 2:John Tallinn founded Skype.
Speaker 1:Okay. He's Estonian. Collectively, have donated over a billion dollars to the cause of catastrophizing AI. Those repeating the meme should understand the source full article.
Speaker 2:Yeah. This This is interesting. I mean, it does it it it begs a ton of interesting questions about, like, how intentional is this? Because when I see someone take the AI safety question into the stratosphere and take me into Terminator world, I do my my natural reaction is like, oh, like, just let people build whatever they want. But then I'm like, no.
Speaker 2:I I I actually don't want infinite AI slop for children with adult content. Like, I do want that barrier. And that's not desell. Yeah. Right?
Speaker 2:I or I wouldn't call it decel, but maybe it's slightly decel. I don't know.
Speaker 1:Think here's the thing. Here's the thing. As AI starts getting better
Speaker 2:Yeah.
Speaker 1:Yeah. As agents start getting better at longer and longer term tasks, it can actually do things that, like, take, you know, reasoning at multiple steps.
Speaker 2:Yeah.
Speaker 1:Yeah. Think the Terminator scenarios Mhmm. Where you could let an AI loose and it's just operating indefinitely against some sort of objective Mhmm. Start to start to be a little bit more for people for, I would say, like, broader tech community to, like, wrap their head around. But right now, they're just so bad at long term tasks Mhmm.
Speaker 1:For the most part
Speaker 7:Yeah.
Speaker 1:Except for, like, some instances of, like, engineering work.
Speaker 2:Yeah. There certainly is some some level of value of just of just being, like, for an average person, like, think of the Terminator instead of, like, well, if you're in this chatbot and you go down this thing, it'll be talking about mirrors, and there'll be a lot of em dashes. And then they might go a little bit crazy, but you can't really tell. And then they might be able to pull out of it, they'll be fine later. But then some people might go way too far and become, like, one shotted, and it's this, and this is it's this complex thing.
Speaker 2:And they're, like, still pretty high functional, and they can still run a venture fund, but they're, like, kind of weird on online. And it's like, well, how do I process that? As opposed to be like, if we don't get this right, it's Terminator. And you're like, okay. Yeah.
Speaker 2:We gotta get it right. Right? As opposed to, like, the more nuanced thing. But, yes, it it is very interesting to understand, like, how the money is flowing and what the incentives are because there are a ton of incentives, and there's and there are all sorts of and there are all sorts of little schemes that can go on to to, to capture, you know, like, regulatory capture stuff. And there's just, hey.
Speaker 2:I just wanna make I just wanna, you know, get paid to do this thing or pay get paid to rate sci fi or whatever. There's so many
Speaker 1:DC says there's not much positive media about AI. That's that's another thing. I I've been wondering, the media obviously will use some of the sources that have been funded by this group. Yeah. Yeah.
Speaker 1:But at the same time, they were already pretty well set up to talk about the potential downside scenarios of of AI development. Yeah. Taylor in the chat says, dang, they named their capital after the guy that built Skype. Wait. What?
Speaker 1:The the capital of, Estonia is Tallinn.
Speaker 2:Oh, it is. That is crazy. Jan Tallinn. That's wild. Well, we have our first in studio guest of the day, Soren Munro Anderson.
Speaker 2:Let me tell you about Google AI Studio. Create an AI powered app faster than ever. Gemini understands the capabilities you need and automatically wires up the right models and APIs for you. Get started at ai.studio/build. Soren, good to see you.
Speaker 2:Good to see you. Congratulations. Give us the news. What, what happened today?
Speaker 5:Yeah. So today, Niras is announcing our $75,000,000 Wow. Series b.
Speaker 2:Do I ring the gong or
Speaker 1:does You hit the gong. You hit
Speaker 2:the would hit the gong. Please hit the gong for us. Thank you, sir.
Speaker 1:Hit it. Woah. So,
Speaker 2:for those who have been, living in a Still going. Yeah.
Speaker 1:Woah. Power of good Power
Speaker 2:of good Yeah. For those who have been living in a foxhole, what do you do? How do you describe the business and the shape of the business right now?
Speaker 5:Yeah. So Neuros is focused on low cost drones
Speaker 1:Mhmm.
Speaker 5:Primarily for the military. So we say we are trying to build an asymmetric advantage for the West. Yeah. What that means is our products have extremely high impact on the battlefield, but are low cost and are built with consumer technology, which allows us to produce at large scale. We're very focused on manufacturing as well.
Speaker 5:So that's kind of in a nutshell what we're doing. But right now, we're focused on FPV drones. So first person view drones, these are very precise manually piloted systems.
Speaker 2:Manually piloted.
Speaker 5:Manually piloted.
Speaker 1:Yep.
Speaker 5:And it's it's the type of drone that's revolutionized the war in Ukraine. Sure. I think FPVs and Starlink are are, like, the two technologies that have allowed Interesting. Ukraine to, do as well as they have and and defend themselves. And so we saw that back in 2023 when we started the company, and both myself and Olaf come from a drone racing background.
Speaker 5:We were both professional drone racing pilots, we saw this technology was actually, like, changing the nature of warfare. And so that's what we we got into this and realized the the whole supply chain is generally controlled by China for this type of of drone, and just drones in general. So our our biggest focus is on a China free supply chain and manufacturing this stuff in America and in the West. Yeah.
Speaker 1:What percentage of drone FPV drones that are active in Ukraine are dependent on Starlink today? So Can you guys do Starlink
Speaker 2:to the drone? Because direct to cell is coming, but drones, it's kind of it's not as big as a plane.
Speaker 1:Because there's also the the what what is the the really light wires that you
Speaker 3:can Fiber optic.
Speaker 1:Fiber optic.
Speaker 2:Yeah. I wanna hear about that too.
Speaker 5:So, yeah, they're they're experimenting with tons of different types of comms. Starlink is used on larger drones, not typically on FPV drones.
Speaker 1:Got it.
Speaker 5:It's a little bit higher latency.
Speaker 1:Yeah. A little bit of lag that would make
Speaker 2:Yeah.
Speaker 5:Little latency and then just the size of the terminal. So it doesn't make it ideal for for our use case where we're focused on very low latency comms, and we actually do custom communications links at Niras. So Mhmm. That's one of our focuses is that low latency anti jam, characteristic. And that's also what fiber optic is used for, because you can't you can't jam fiber.
Speaker 1:Yeah.
Speaker 2:Yeah. It feels like AI is so controversial, adult content getting one shot. How does it feel working in an uncontroversial category now?
Speaker 1:I mean, I don't I don't I don't think Are being sarcastic? It It
Speaker 2:does feel like a lot of the, a lot of the, like, you know, is this is this bad energy has been absorbed? Like, you're not gonna be clack crash the global economy. It feels like the the vibes have definitely shifted. Give me, like, the broader update on, like, how you think that, just military technology in general is being perceived by America or any any constituents.
Speaker 5:Yeah. I do think there's been a huge shift in the last couple years. Yeah. The world's watching what's happening in Ukraine Yeah. And thinking to themselves, well, if it can happen to them, it can happen to us.
Speaker 5:Yeah. And so it's no longer controversial to, like, think that you have to build systems that allow you to defend your territory. And and so that's what like, our primary goal is territorial defense of sovereign nations, and that should be a very uncontroversial thing to work on. Now, there's a lot of talent out there that just doesn't wanna work on defense Sure. Or isn't comfortable working on actual, like, kinetic systems.
Speaker 5:Mhmm. But we're we're, you know, very upfront about what we do. We make drones that explode. Good. So if people do wanna work on that, then they tend to be very, very motivated because they see the impact that it's having.
Speaker 2:Do you like Palmer's framing of, like, America as not the world police, but as the world's arms dealer? This idea that America should be turning all of our adversaries or or all of our, all of our allies into spiky porcupines. I think that's the phrase he uses. Do you like that?
Speaker 5:Yeah. I think that's a great framing. I'd also say there's a tremendous amount of development, being done in other places right now where America actually needs to, like, catch up. Yeah. So the other, like, large announcement that we have today is that we were selected by the US Army's, purpose built attributable system program.
Speaker 5:In, normal speak, it's basically the way that the Army is gonna buy our type of drone, buy FPV drones. Sure. So this is a really big deal because it shows that the Department of War and the army, are moving very quickly on actually, like, getting these, getting these drones deployed to to their forces Yep. And teaching people how to fly FPV. And this is currently, like the The US is so far behind on this right now.
Speaker 5:But you have like, the Marine Corps, we just announced a $17,000,000 purchase order with them. The Army selected us for the PBAS program. You've got the, drone dominance and and, just all the the support from the top level with with Hagsef. The the Department of War is very, very serious about drones now, which is incredible to see.
Speaker 2:Yeah. I was always I I was wondering about how you balance out that framing of, like, we have to build for a Ukrainian person, a Ukrainian soldier because the Ukraine war is not a place where we're sending hundreds of thousands of Americans boots on the ground. Like, that's not what the modern battlefield looks like. It looks much more like this arms dealer relationship that Palmer outlines. But at the same time, there we do need to keep our own armed forces equipped with the best technology.
Speaker 2:We need them up to speed in case something does happen and we do go boots on the ground. How how do you think about, like is it like a tech transfer where you're using stuff you've learned in Ukraine and bringing that to the army and just getting them up to speed with this Marine Corps? Like, how how do the two what is the flow between the r and d cycle that's happening abroad for another nation, for an ally, and then also something that's happening for American soldiers?
Speaker 5:Yeah. That's a a great question. It's all about the iteration loop that we can build. Yeah. And so this is why Neuros operates in Ukraine.
Speaker 5:We have an office in Ukraine. We have a team there Mhmm. And we've sent thousands of systems to Ukraine. And so what that allows allows us to do is work directly with the military units there and understand how our systems are working and not working.
Speaker 7:Mhmm.
Speaker 5:A lot of US companies, unfortunately, deployed things into Ukraine at the start of the full scale invasion, but then were turned off by the fact that their things didn't work and people told them they didn't work, and then they didn't go through the cycle of improving them. And then you hear a lot of talk about sort of the regulatory hurdles and why it's hard to work with Ukraine, which it is. There are plenty of hurdles, but it's absolutely critical that we're looking at the cutting edge, the battlefield where this stuff is being proven, being developed to make it actually effective for our soldiers. Because I have a pretty strong feeling that a lot of the technology that's being developed in America right now is going to fall flat on its face when it actually sees primetime.
Speaker 2:Yeah. Jordy?
Speaker 1:Are countries do countries want a sovereign, like, drone manufacturing base? Are are you exploring?
Speaker 2:Interesting.
Speaker 1:Because, like, part of part of, I think, Ukraine's success at least in in, you know, at least dragging this war into this, like, you know, basically, like, slowing slowing the pace has been their own internal production capacity, which I'm sure you guys don't know if you would classify it as, like, competing with, but, like, certainly, I'm sure, like, the systems are are both being used in the same, in the same fronts. So I'm wondering in the same way that countries are want, like, a sovereign AI strategy, they want their own data centers, that they also want to make sure they have local drone capacity, or if they're comfortable saying, like, we have our partner for this, and we just need to know that we can, scale up, the supply side on whenever we want.
Speaker 5:Yeah. Countries absolutely do want their own drone industrial base, their own, like, domestic supply. And this is something we recognize and we're we're working on. So, I think it's you gotta realize that the supply chain has to be somewhat global to compete with China. There's no one country that's even close.
Speaker 5:And so if we're gonna have a chance at this, it's a collaborative effort. The way Niros thinks about this is, you know, at some point, we're gonna build a a massive factory that's capable of giant volumes. But what's coming out of that factory, might be, you know, 70% components and drones that are assembled in other places, like the these nodes that are, in other countries. We think it's really important to be a Western defense company, not just an American defense company. Sure.
Speaker 5:And and that's you know, again, with our our work in Ukraine, we have a a presence in in London. We are also we're basically expanding globally earlier than I could have guessed Yeah. And and earlier than most start ups do because drones are a category that are inherently like like, countries want it close to their chest, and and they want to work with systems that are proven and that are interoperable with their allied partners, but they do need that that industrial domestically.
Speaker 1:And so would you pursue, like, a GoCo model at some point where, like, a country would actually, like, own the facility and and you guys would effectively, like, provide the IP on that? Is that is that a model that you guys are pursuing?
Speaker 5:Yeah. That's, that's definitely something that we are are looking into. We are trying to figure out how to build out the most robust supply chain and then put our, you know, put our manufacturing into a, not a literal box, but into a box, and and be able to teach kind of any, group of folks around the globe, like, is how you assemble archers. Yeah. And a lot of that also looks like building really great testing and and just being very confident in the components in the supply chain.
Speaker 5:And so it's a it's a very, very large effort to get there, but we are going in that direction.
Speaker 1:What's the progress on the capacity front? I think when we had you on the show last, you were in the was it single? Like, you were doing I wanna say it was something like a thousand drones a month Yep. But you're ramping it up from there. Where how's the pacing?
Speaker 5:Yeah. So right now, we're currently, like, actually producing, about 2,500 Archers per month. That's mostly driven by demand. So we're we're ready to scale well beyond that. And we've been on a pretty, like, steady ramp since the that thousand number earlier this year.
Speaker 6:Yeah.
Speaker 5:And we're we're leaning very forward on our capacity and our supply chain, because we do expect that the the tens of thousands a month, demand is gonna be there next year.
Speaker 2:And Ukraine's using something like 5,000,000 drones a year or something?
Speaker 5:That's right.
Speaker 2:So, I mean, like, it it's you're at, like, 1%, but, obviously, that's incredible considering that you started the company just a few years
Speaker 5:As far as we know, Nerus is the highest rate drone producer in America.
Speaker 2:Yeah.
Speaker 5:No no one has, has proved us wrong on that yet.
Speaker 1:I'm sure they'll I'm sure they'll reach out if
Speaker 5:Yeah. Yeah.
Speaker 1:They do. So what what are the you mentioned pathways in the military now that you can become an FPV pilot. Is that gonna be a track now in the various groups, whether it's, you know, army, navy, etcetera, where people will go in and and choose, like, I wanna be an FPV pilot?
Speaker 5:It's not set in stone yet, but there's various different paths. So Neuros does training courses. We we offer this as a service to our customers. But there are also efforts like, you can look at the Marine Corps attack drone team. They've done a fantastic job just leaning forward, and sort of, like, from the bottoms up figuring out FPV tactics, and training a group of experts, and then they're passing that across the whole, Marine Corps.
Speaker 5:So you you see that a lot in the FPV world where guys are actually into it as hobbyists, and then they see, you know, what's happening in Ukraine. They're like, wow. We we actually need to figure this out for our own unit. And so it just kind of happens organically. And then now with all the top level support as well, those two things are kind of meeting in the middle.
Speaker 2:Take me through a little bit of the supply chain. Obviously, with the iPhone completely made in China, there's a push to make an iPhone in America. But we everyone knows that it's gonna be Vietnam, India, South Korea, Taiwan, a bunch of other things in the interim. You mentioned wanting to be a western defense company. Where are you seeing pockets of just excitement on the industrial side within the American allies world?
Speaker 2:Like, where are you finding, oh, we can find motors in Canada or or Taiwan's coming online for something else. Like, where where is interesting in the supply chain globally?
Speaker 5:People are really starting to pay attention to the, like, critical minerals
Speaker 2:Yeah.
Speaker 5:Which is, you know, super, super important for things like motors and batteries.
Speaker 2:Sure.
Speaker 5:So, you know, there was a a deal that I think was announced last week
Speaker 1:Yeah.
Speaker 5:Like a $1,500,000,000 deal with Vulcan Elements
Speaker 2:Yeah. Vulcan. Department of War.
Speaker 5:Yeah. There is similar efforts with, like, MP Materials Yeah. Domestically. And we do see, like, smaller kind of start ups going after the actual motor assembly side. So that one, I think, has been pretty clearly highlighted and people are working on it.
Speaker 5:Yeah. It goes, you know, beyond Nerus, beyond the drone industry. It's it's just like a industrial base wide problem when you get to the material level.
Speaker 2:Those are Redwood Redwood materials, which is just recycling for I I imagine if you're if you're on a battlefield and you're blowing up a bunch of drones, then you can go and get the magnets back. Like, that's that's a pretty easy thing to recycle, would imagine. Although it's probably hard to get it out of the of the battlefield.
Speaker 5:Yeah. But over time battlefield would be very difficult. But think about all the, you know, washing machines. Like
Speaker 2:For sure.
Speaker 5:You know, old washing machines in America. There's so much neodymium there. Yeah. Sure. I I don't know how big the supply
Speaker 2:realize that's so much in there.
Speaker 5:I mean, just think, like, anything that has an electric motor that's here domestically. Like, that is stuff that can be recycled.
Speaker 2:So Yeah.
Speaker 5:There is a little bit more, like, there are things that give me hope, but there's plenty of things that scare me.
Speaker 2:Yeah.
Speaker 5:Nearest, we we spend a lot of our time going down to the chip level. Sure. Because one of the things we see pretty frequently in the drone industry is folks saying that they're, you know, NDA compliant, basically, assuming not Chinese. And it just mean the component is assembled outside of China, but it's still using Chinese microchips.
Speaker 2:Yep.
Speaker 5:And to us, that's kinda useless. So we spend a lot of our time working with the actual chip vendors, the chip manufacturers, because you have to ensure, like, this the wafer is not made in China. It's not packaged in China. It never goes through there from the supply chain.
Speaker 2:Yeah.
Speaker 5:And that's, like, not something that's required by the regulations yet. Yeah. So we're trying to get ahead of that, and we're we're we're going very, very deep. But the the the problems scare me all across the
Speaker 2:Yeah.
Speaker 5:The entire supply chain.
Speaker 2:Are there any places where it is fine to buy from China? I'm just imagining, like, like, raw aluminum. Like, that's not in short supply. It's just something that you kinda need. And and it you can't really put a microchip in there or a microphone or do some sort of remote takeover.
Speaker 2:Like, it is what it is. Just buy it from wherever.
Speaker 5:Yeah. I I think there's an eighty twenty rule. Yeah. I don't think that our progress on for example, like, our progress fielding FPV systems to US forces should not be stopped by requirement that everything has to be completely China free right now because it wouldn't be possible. Yeah.
Speaker 5:Yeah. And and so what you wanna think about is preparing for the instance where that is completely cut off Sure. And what would be what would be items Yeah. That are are quick to replace. And, you know, we like, when we do our efforts to get rid of China in our bomb, it's basically looking at the things that are most critical first and putting our engineering, like limited engineering resources towards those.
Speaker 5:And then the the things that are, you you know, would be less catastrophic, those are lower down in the priority step.
Speaker 2:That's bill of materials, not b o m b.
Speaker 5:Right? Sorry. Yes. Bill of materials. It's easy to confuse when you're talking about Niros.
Speaker 2:It is. It is.
Speaker 1:I was confused. To yeah. Well, I wasn't confused. I just assumed you were talking about an actual
Speaker 2:Take me on tour of, of of what, I don't know how much you can share about this, but, what are people excited about on the counter UAS side? Because we've seen Anvil. We've seen then, electronic takeover. Then there's the fiber optics thing that we've seen. There's been a whole bunch of it feels like a game of, like, rock paper scissors on the battlefield.
Speaker 2:Is it just rock paper scissors, or is it more like chess? Is it
Speaker 1:I saw a video of throwing up nets over Nets.
Speaker 2:I've seen eagles come in and birds. Like, what's actually that one. What's actually getting used? I imagine that the birds didn't make it out into the field, but did they? I don't know.
Speaker 5:The answer is kind of everything because it has to be layered. Okay. So you have your EW systems. Sure. Those are kind of your primary line of defense
Speaker 2:This would be passive?
Speaker 5:FPVs. I mean, they're they're passive Well, you're activating them because you also need your own drones to be able to get through. Right? Okay. So this is one of the things that's actually very tricky in Ukraine Okay.
Speaker 5:Is coordinating the, like, friendly electronic warfare with the friendly drones that you can pass over that sort of line on the front and get over into enemy territory. Interesting. So there actually needs to be a pretty close, tie between the electronic warfare operators and the drone operators. Yep. You also have sort of the last ditch efforts, and this is things like nets and shotguns.
Speaker 5:Yep. And I'd say sort of an in between of that is something like, what what, Allen Control Systems is building. Right? Where you have an automated gun turret. Yep.
Speaker 5:It is it is just smacking drones out of the sky. But personally, I wanna try to take that drone out, you know, well before it gets within hundreds of meters of of where I'm at. So, that's where longer range electronic warfare, things like that are are gonna help.
Speaker 1:But Is there any is there what's the path to having, like, an FPV drone flying using computer vision to identify another, maybe, enemy drone, and then having some type of, like, locking system where you're using drone a friendly drone to take out another drone in the sky?
Speaker 5:It's already happening. Yeah. Drone on drone warfare is a very real thing now. And so interceptors have become, one of the sort of latest big developments coming out of Ukraine. So they're intercepting everything from, you know, small FPVs, Mavics, larger reconnaissance drones, and then Shaw head type drones.
Speaker 5:And so you need different types of interceptors for each of those. But we are starting to get to that point that a lot of people have imagined where it's it's you know, the front line is like drones versus drones. And a lot of the time, you're not even making it to a kind of typical military target because there's just so much drone activity happening.
Speaker 2:Take me through the the biggest or the most exquisite drone that we might see on the battlefield versus, like, the least exquisite. So I imagine that there's no drones that cost $1. That that is just too cheap, and there's no drones that cost a billion dollars. But are we in the there's a thousand dollar drone, there's a million dollar drone? Like, wide is the gap of, like, if you just look at the whole battlefield, what's the gap between, like, the scale of, like, the biggest, most insane drone to, like, the smallest, most attributable?
Speaker 5:Yeah. Drone means so many different things. It's really confusing
Speaker 1:Sure.
Speaker 2:People. Isn't f '35 a drone? Like Right. Might be in a certain context.
Speaker 5:I'd say like the lowest end is kind of your your like FPV system. Yep. That's, you know, if you're if you're, like, getting that in Ukraine, it could be 200, $300. Yep. Primarily built from Chinese components
Speaker 1:Yep.
Speaker 5:Know, very inexpensive. Yeah.
Speaker 2:Almost like like consumer level hardware.
Speaker 5:It's it's consumer level hardware. I mean, it's been modified Sure. To perform better, but
Speaker 2:And then they, like, tape a grenade on it.
Speaker 5:Yeah. Exactly.
Speaker 1:Does does Russia ever call China and say, why why are you guys supplying componentry that gets into the, like, hands of our enemy? Or or is it just kind of, like, is if I'm if I'm Putin, I'm calling up Xi, and I'm saying, hey, our number one problem right now is basically you.
Speaker 5:Yeah. I I would say China has benefited by far, like, absolutely the most from Selling
Speaker 1:to both sides.
Speaker 5:Of Ukraine. They are deliberately selling to both sides Woah. And millions of units. I mean, it's it is, you know, billions, tens of billions of dollars being generated, for for the, the economy in China based on the war in Ukraine. And you can even see, like, Ukrainian entrepreneurs will talk about this where they go to Shenzhen and they're negotiating deals to buy hundreds of millions of dollars of components.
Speaker 5:And, technically, it's it's banned in China, but everyone's benefiting. So why would they stop it?
Speaker 2:Okay. Take me up the stack. We so you have a $200 drone, Chinese components off the shelf. What's the most exquisite drone that
Speaker 1:Wait. Wait. Before we get before we get higher, there was a YC company that got announced last week using drones to take out mosquitoes. Oh, A lot of people were saying
Speaker 2:It's for assassinations. Well That's what they were saying.
Speaker 1:Well, yeah. But they were saying, like, this is impossible. Oh. Is it is it possible?
Speaker 5:I have no idea. It's hard to say. I probably wouldn't use drones for taking out mosquitoes, but best of luck to them.
Speaker 2:Apparently, the founder is just, like, obsessed. Everyone was like, oh, he's he's doing this for DefenseSec. And it's like, no. Actually, this founder just hates mosquitoes. And he's, like, obsessed.
Speaker 2:He's been on a lifelong quest to, like, kill the mosquito, which is hilarious.
Speaker 5:I do I I, I align with that.
Speaker 2:I grew
Speaker 5:up in in Alaska, and there's a horrible amount of mosquitoes. So if it works, I'm gonna be pumped.
Speaker 2:You grew up in Alaska. What's with all these Alaskan kids around? Yeah. Do you do you grow up near, Ty Morse?
Speaker 5:We grew up in Anchorage. Yeah. Together? No. We didn't know each other.
Speaker 2:Okay. You didn't
Speaker 5:know each other. This was a crazy connection.
Speaker 2:That is a crazy connection because I feel like there's a lot of shared
Speaker 1:And it's you wanna say 100 people, you guys didn't know each other? Basically. Basically. What's the actual population? It's like
Speaker 5:350,000 in Anchorage.
Speaker 1:Yeah. Pretty big.
Speaker 5:Yeah. Yeah. That was crazy. And I don't know how we no. Now we've connected and like Yeah.
Speaker 5:Eye crashes at my apartment when So, he's in Good Alaska connection.
Speaker 2:Been a great run. That video that you put out, or that he did with like checking in on the Gundow, the whole like table was awesome because, I feel like two years ago or something we met, and the total amount raised across the entire Gundow crew was, like, $5,000,000, and now it's, like, close to half a billion.
Speaker 5:Yeah. That's wild to think about. In in one of the the group chats earlier this morning, Isaiah posted his raise.
Speaker 2:Yeah. Yep.
Speaker 5:And then we posted our raise. And someone else was like, another quarter billion to the fellas. It's insane. It's ridiculous.
Speaker 2:It's good. It's exactly what should happen. Like, they like, when when the the reason I mean, the Gunda was like this meme. It was this moment. It was this like, oh, like, there's this cool movement happening.
Speaker 2:But, like, fundamentally, it was like, okay. This is actually what works, and this is where the capital should be going. It should not be going to Yeah.
Speaker 1:The critique the critique was
Speaker 2:the other junk stuff.
Speaker 1:Was a lot of these companies aren't gonna work. You can apply that critique to any sector or region that gets venture capital dollars. Anyway, so
Speaker 5:we're moving up critique was was kind of valid. Right? Because there was a lot of, like, we're talking about crazy ambitious things that were, you know and also in a kind of silly manner
Speaker 2:Sure.
Speaker 5:Which attracted a lot of attention. And I I think there's reason to critique that, but now you see that, like, the El Segundo companies are truly executing. Yeah. And that's that's where the difference is. We went heads down for a year and a half, two years, and now the results are are starting
Speaker 2:It was very clearly in that group chat, like, a somewhat of a moratorium on posting at some point because Yes.
Speaker 1:Because We get off the timeline.
Speaker 2:But it worked. It worked. And it was great because We gotta lock in. There was a world where it was like, okay. Everyone in El Segundo winds up becoming a podcaster.
Speaker 2:And, like, it's like, okay. Well, there's actually nothing getting built. Like, you you like, you guys really did get, like, lost in the sauce, but that never happened. It was just like, oh, wow. Another puff piece from the legacy media.
Speaker 2:And they just and it was great because that that's super high leverage because you just, like, show up, you get the thing, and then you
Speaker 1:move on. Up the stack.
Speaker 2:Move up the stack for us.
Speaker 5:Yeah. So on the the other end of the range of drone Yeah. That I I would call that, like, the the CCA, Collaborative Combat Aircraft Okay. You know, that Anderl's working on
Speaker 2:Yeah.
Speaker 5:As well as other other startups and primes. Yeah. That's I mean, it's an autonomous fighter jet. It's hard to get more exquisite than that in the in the drone world.
Speaker 2:So Anderil just flew theirs yesterday, the YFQ 44 a, and then, General Atomic has a a similar, program in the CCA. Those aren't live in Ukraine yet. Right?
Speaker 5:No. Definitely not.
Speaker 2:Okay. So then there must be something that's, like, the next best that's out there. Is that right?
Speaker 5:Well, there there's tons of there's too many categories to make in drone. So, like, you go up the stack from
Speaker 9:You make
Speaker 5:it FPV to a fixed wing that'll go like 5,100 kilometers. Then you're you're also looking at a bunch of reconnaissance drones.
Speaker 3:You have
Speaker 2:Your Reaper.
Speaker 5:DJI Mavics, like, you know, small, cheap, but also up to really expensive fixed wings.
Speaker 2:Sure. Sure.
Speaker 5:And those are kind of all, like, deployable by one or two people. And then you get into the really big stuff, and that's your, like, Reapers and Yeah. Kind of in between that is the, like, Shield VBAT. Yeah. And so, you know, you can look at all there's there's a group one through five
Speaker 2:Okay.
Speaker 5:Classification
Speaker 2:There you go.
Speaker 5:For drones. So and within those, there's tons of different categories.
Speaker 2:And and are you firmly in one group and you plan to stay there? Do you want to be in all five groups? Is that even like the right way to think about growing your business? Or are there other business lines that you could expand into that doesn't just mean total dominance of the groups?
Speaker 5:Yeah. So true success for Niros means making the West the West drone industrial base competitive with China. Yeah. So there's a lot to do in that. Right?
Speaker 5:Yeah. We're not gonna just be doing FPV drones in the future. Sure. But we do know that, like, focus is probably the most important thing
Speaker 1:Yeah.
Speaker 5:For a startup. Yeah. And the the market for FPV drones is massive and and only growing. Mhmm. And they are, like, I believe they are the most important type of drone to be working on right now.
Speaker 5:And until America can produce them in the millions, we we are pretty focused on that.
Speaker 2:Yeah. Makes sense.
Speaker 1:What is the state of drone racing today? Is it growing in popularity? Or is it staying staying niche? Is it yeah. Are you guys hiring out of it?
Speaker 5:We are definitely hiring out of it. Mhmm. We have lots of drone racers on the nearest team. Yeah. It it's been a great talent pool.
Speaker 5:I do think that, unfortunately, it has sort of fallen off in popularity from its peak. Really? But I do think it's gonna come back, especially with all of the relevance to military. We're starting to even see military drone racing leagues coming up. And Yeah.
Speaker 5:That's where, like, I think that is gonna become the the pipeline for drone racing talent in the future.
Speaker 1:The new, like, sports shooting where on a base, it's like who can who's the fastest That's the accurate pilot versus
Speaker 2:would be fun. The other thing that would be interesting, I don't know if anyone's doing this, but autonomous drone racing league. That feels like pretty valuable to build out that skill set. Can you can you write can you, as a team, build a software stack that gets you through all of the different obstacles while they're while you're being jammed or while there's flashing lights going on and off and adding some sort of variability.
Speaker 5:Yeah. I think the you would have to add a lot of variability because the hardest thing about autonomy is not making a drone go to a known point Sure. Or or making many drones go to a known point. It's operating when you don't have GPS, when it's dark out, when there's bad weather, when your comms denied. Like, that's why autonomy is I I think it's behind where most people think.
Speaker 5:Totally. Like, most drones in Ukraine are not autonomous at all. Yeah. And so But that's but that's true of self driving cars in America. Yeah.
Speaker 5:Like Yeah. I I there's
Speaker 2:a lot of teleop going on. There's a lot of stuff like that. And and and, yeah, the like, we're we're we're just still years away from it actually being.
Speaker 5:Exact and we're huge believers in autonomy.
Speaker 1:Of course.
Speaker 5:We're scaling our autonomy program, and it's it's gonna make drones just so much more effective for soldiers. But the there's been AI drone racing leagues for a long time. And, like, the the University of Zurich has been working on this for for many years, and they have a drone that's beaten, like, professional pilots around a closed course.
Speaker 2:Okay.
Speaker 5:But it only works in a closed course. And often, they have, you know, hundreds of camera angles, and they're set, like, tracking the position of the drone
Speaker 2:yeah. No. From outside drone.
Speaker 1:Yeah. That that that
Speaker 5:that is, like That doesn't actually apply
Speaker 2:to drone. Exactly. Yeah. You need to narrow it down because I imagine that I I have this, joke. This is, like, joke of a test for AGI, which is, like, I want the humanoid robot to get into a a manual sports car and do the Nurburgring in seven minutes, like, shifting gears Yeah.
Speaker 2:Like, with the g forces. Like, that is extremely difficult, and we are clearly decades away from that. And and I think the same thing is probably true for for actual drone racing, like, how how long it takes if you don't have all of the extra perfect information. Like, you actually try and simulate what it's like for the human.
Speaker 5:Well, I think the, the lap record on the Nurburgring for a manual sports car is is, I think it's right above seven minutes. Yeah. They'd have to be doing really well. Gotta get the
Speaker 1:robot robot can a robot can take it to the edge. Right? Like, you could Yeah. A robot could crash like 20 times in order to to actually get the lap time. So potentially you could be like, well, on this corner we can hit it at
Speaker 2:That was
Speaker 1:180 even though like there's a
Speaker 2:Maybe push it further.
Speaker 1:51% chance we'll
Speaker 2:Yeah.
Speaker 1:Go into the Can we
Speaker 5:be the next episode from the Nurburgring? From the
Speaker 1:passenger That'd be amazing. From the passenger seat.
Speaker 6:I'd love that.
Speaker 5:Up the stakes.
Speaker 1:Up stakes.
Speaker 2:Have we gotten into racing? I know some of the Gundot guys love racing.
Speaker 5:Yeah. I mean, I But you have
Speaker 10:a lot.
Speaker 5:Love racing sports from a young age and know, was focused on drone racing Sure. For about ten years, but I'm I'm also a huge car guy. And Yeah. So I follow follow a lot of it.
Speaker 2:That's cool.
Speaker 1:We gotta we're gonna do a TBP on track day.
Speaker 5:Yeah. We gotta do incredible.
Speaker 1:You will get the invite.
Speaker 2:Yeah. What's the what's the team size like? How big is the company?
Speaker 5:So we're at 80 people now, and we're hiring as fast as we can.
Speaker 2:And and are you gonna stay in El Segundo? Do you have to graduate and leave? Like, is
Speaker 1:They're already global.
Speaker 2:It's already
Speaker 1:It's already an international businessman.
Speaker 2:Yeah. But I mean, in terms of HQ, it feels like El is like this amazing, like, proving ground for all these companies. But at a certain point, if you want 20,000 square feet, 200,000 square feet, it just makes sense to, even just go, like, one, you know, one city over. But what's that like?
Speaker 5:We're expanding, and we're trying to stay in El Segundo. Cool. There there are big buildings. Yeah.
Speaker 2:ABL's there.
Speaker 5:Right? It's Yeah. I mean, you you have to kinda be intentional about it, and and it's not an easy real estate market by any means. But we're trying very hard because this I think the city's done a lot for us, and we wanna stay there. Yeah.
Speaker 5:And, yeah, we're we're growing a ton in the the headquarters in Los Angeles as well as our other other global locations. So the really, I would say the biggest limiting factor to our execution is just the the number of great people we can get on board.
Speaker 2:Mhmm. Is there is there gonna be, like, a separation on, like, where the factory is at some point? Like, you'd set up a factory in, like, a Midwestern city or something like that at some point?
Speaker 5:Yeah. That's that's very likely. At some point, it doesn't make sense to do the scale that we're talking about, in California. Yep. But you have access to the best engineering talent.
Speaker 5:Sure. Sure.
Speaker 2:So for design stuff
Speaker 5:and then you still need a lot of those engineers to be willing to also go out to, know, the the factory, wherever it is because Yeah. It it is critical to have your engineering talent right next to your production.
Speaker 2:What about automation on the production line? Like, get me up to speed on, on how relevant that is versus you're trying to iterate. And at a certain point, you might learn something from the battlefield and need to change the entire design so you don't wanna bake everything in. Right?
Speaker 5:Yep. Automate is the last step in the formula. Okay. And so you can even look at, like, the iPhone production
Speaker 2:Yeah.
Speaker 5:Where, you know, they make a new version every year. And a lot of that is hand assembly done with, like, simple tooling.
Speaker 2:Yeah.
Speaker 5:Tooling's really important Mhmm. And and being smart about your your workstations and your work instructions and and, you know, you wanna be making it as easy as possible for the human operator. But a lot of the time, it does not make sense to automate.
Speaker 2:So is the DJI blackout factory fake news?
Speaker 5:I think it's real.
Speaker 2:You think it's real?
Speaker 5:Yeah. And it's hard to say because the last time they let a camera into a DGI factory was like five years ago. Mhmm. But I think that should tell you something about what what they're working on. Interesting.
Speaker 2:Well, they could be faking it. Right? Because they could be like, yeah. Because if the iPhone I think the iPhone pulls in like $2,000,000
Speaker 1:There's just a bunch of people bunch of workers in there with night vision goggles. Was really really
Speaker 5:blackout back.
Speaker 2:Yeah. Turn the lights off like, we got you owned. Like, tried this. Americans, you guys suck.
Speaker 1:And it's just like working
Speaker 2:with night vision. I I don't know. But you you you think they're pretty advanced?
Speaker 5:But at some point, it it doesn't
Speaker 2:You don't you don't like, you don't think it breaks the laws of physics or something.
Speaker 5:So Well well, it it doesn't necessarily matter if you're able to produce at scale Yeah. At cost, like, which they're already doing. So Yeah. Exactly. Whether they're doing it with all with robots or all with people
Speaker 2:Yeah.
Speaker 5:They're already able to do it. So it doesn't it doesn't really matter. We need to figure out how we can do it in America.
Speaker 2:Totally. Totally. Yeah. Yeah.
Speaker 1:That, yeah, that makes a ton of sense.
Speaker 7:It's funny.
Speaker 1:Great stuff. Well, thank you for the update.
Speaker 2:Yeah. Thanks
Speaker 1:for doing this work.
Speaker 2:And congratulations on the round.
Speaker 5:Thank you, guys. Great to see you.
Speaker 1:We'll, we'll see you at the track. Awesome.
Speaker 2:Track soon. We'll talk to you soon. Thank you so much. Let me tell you about ProFound. Get your brand mentioned in ChatGPT.
Speaker 2:Reach millions of consumers who are using AI to discover new products and brands. Our next guest is already here in the TBP And Ultradome looking fantastic.
Speaker 6:What an
Speaker 2:outfit. You're gonna have to break that down for us. Thank you so much. We have Jeff from Anderle. Great to see you.
Speaker 2:You too, brother. Please.
Speaker 1:Every every guy should have, like, 20 or 30 jackets like this. That is a good idea.
Speaker 3:'92.
Speaker 1:Build it up over time.
Speaker 3:From eBay. Did not smell great when I first
Speaker 1:got the that's the problem. That is that's the problem. Great to have you here.
Speaker 2:Great to be here. For those who aren't familiar, please introduce yourself.
Speaker 3:My name is Jeff Miller. I'm the VP of marketing at Anderil.
Speaker 2:How'd you wind up there?
Speaker 3:Long windy story. So I was starting out in advertising. I was inspired by those old Spike Lee commercials, It's Gotta Be The Shoes. I always knew I wanted to work in advertising and marketing. Worked on Ogilvy, then went to PepsiCo where you build great classic brand marketing principles.
Speaker 3:Yeah. And then I decided I wanted to go and do something that felt much harder, much much more foreign to me. Yeah. So I went to LA, spent six years here working at Snap, and had an incredible experience there building pre IPO as as they went public and beyond. And I had a global team at one point, but the way I describe it there was like a great formative experience, it felt a lot like eating potato chips.
Speaker 3:It was it was really fun, but it it was, you know, tasted good in the second, but didn't leave any sort of meaningful impact on me beyond just the moment. Yeah. And so I was looking for something more more impactful, that's what drew me to Andoril.
Speaker 2:How how do you think about, like, who you're targeting with Andoril marketing? Because it feels like I've never bought an Andoril product. I love the brand. Yeah. Yeah.
Speaker 2:Is that relevant?
Speaker 1:Alternate In timeline, you would have worked at the company.
Speaker 2:Yeah. So is it recruiting focused or are you actually trying to do brand marketing that will hit with like the buyer in DC? Do you think about it that way? Are you at all quantitative or is it like way is it just a way higher level?
Speaker 3:The way we think about it is that we, of course, are thinking about the operators with within that are gonna use our actual products Sure. And thinking about the Pentagon, the people who gonna buy it. Yeah. Yeah. But ultimately, we're also thinking about our employee base Yeah.
Speaker 3:Future employees.
Speaker 1:So Yeah.
Speaker 3:How do we be thinking about brand as a talent magnet?
Speaker 2:Mhmm.
Speaker 3:But even broader than that, we think about Americans at large.
Speaker 2:Sure.
Speaker 3:For us, we believe defense deserves really strong brands. Mhmm. The war fighters deserve strong brands. And I think if you look at the current administration, what they're doing with the Department of War and their storytelling or even let's give an acknowledgement to the marines. The two hundred and fiftieth anniversary today of the Wow.
Speaker 3:Of the marines. Wow. And you look at the content they put out over the weekend, it just makes you want to enlist. And for us, it's been a historically opaque industry that has really lived in the value of not telling clear stories. Yeah.
Speaker 3:And we see the complete opposite. Yeah. We think that this story deserves to be told for our war fighters
Speaker 2:Yeah.
Speaker 3:For the American taxpayer to understand what we do and why it's so important.
Speaker 1:Yeah. What was the what what was the historical marketing strategy of of the primes? Did they did they do like, how how did they even think about their marketing? Because I'm obviously, you came in and you're like, hey, let's reinvent marketing in this iconic
Speaker 2:brands. Like like, there's just no denying that every if you just walked down the
Speaker 1:street And the question that I the question that I have is, like, know. Iconic because when you look at some of the products that they've made Yeah. Specifically, like, fighter aircraft Sure. Certain firearms Yeah. Etcetera.
Speaker 1:Like, they are iconic products. Yeah. Like, make you you know, people post, like, the b 21 raider as, a meme. Yeah. Yeah.
Speaker 1:It's like, when you're you know that you're onto something if your product is being turned into a meme. But I just wonder if if there was any history of them doing saying, hey, let's do an out of home campaign.
Speaker 3:Yeah. Because What I think you're hitting on is a really important point. When we talk about brand here, it starts with the product itself.
Speaker 7:Mhmm.
Speaker 3:Product is brand, I think, in our category as much as as any.
Speaker 1:Yeah. Yeah.
Speaker 3:Because it's it has this great ability to speak to national security in a way that will rally the country to really think about what's great about America, about advanced manufacturing, about innovation, about what Americans hard at work can can achieve. So if you look back at the fifties, sixties, seventies, there's incredible advertising that you would see from Lockheed and and from the other primes. And that's something that
Speaker 1:And were these like Porsche style ads where it's like a lot of text and just like a picture of it and it's like, you know, the the f 16 is not just a fighter jet.
Speaker 3:Know what's so great? So I worked at a company named Ogilvie Mather and David Ogilvie is famous for starting that style of ad.
Speaker 1:Yeah. Yeah.
Speaker 3:The long lead copy. And I think why that resonates so well in the context of Porsche is because ultimately, it's just a really great story Yeah. A product that isn't for everyone, but resonates with a specific set of people. And in a lot of ways, those are the principles we use today.
Speaker 2:Yeah. Walk through, like, how you actually think about a a whole campaign. I feel like Andrew launches a lot of products, and there's a lot of different tools in the tool chest. Like, I'm thinking about the Eagle Eye launch. Mhmm.
Speaker 2:There was obviously a video. There was also, like, a Joe Rogan appearance
Speaker 1:Yeah. Yeah.
Speaker 2:Which is, like like, is that all in one, like, project brief or deck? Or how do you think about, like, all the different touch points? Because there's so many with something like Andoril where product marketing for a new launch might be a dinner in DC or it might be a Joe Rogan experience. There's so much that you can do that's not just like, okay, make sure the Facebook ads are turned on.
Speaker 3:Well, what I think you're you're seeing rather than something like Facebook ads is we're really speaking to capabilities versus selling ads in the way that we think about it. And I wanna give a a real credit to the team behind here. So Shannon Pryor, our VP of Communications Jen Buchi, our VP of Design Andrew Lee, who's our Director of Product Marketing. All of these people together are working closely with our division, with their business line, with their founders on how do we tell one cohesive story. And I think what's important here, it's not a template that we use.
Speaker 3:Depending what that product launch is, depending on the message that we're trying to communicate, depending on who the core customer is, all of those influence the approach that we take. So those those elements that you spoke about for Eagle Eye, all of those were worked in close coordination.
Speaker 2:Mhmm.
Speaker 3:What was true and I think is always true of the products that we launch is it's always first and foremost about demonstrating real capabilities. We have a rule that comes straight from Palmer. No render rule. And what that means is that we're never gonna fake our capabilities. We're gonna always demonstrate the work that we do in a way that's reflective of the actual capabilities themselves.
Speaker 3:So what you see on screen here is is a real capability of Eagle Eye. It's mission planning.
Speaker 2:Yeah.
Speaker 3:With another vignette that spoke to our our heightened survivability, our our lethal capabilities. And what I give a lot of credit to our our design team is the way they thought about this was actually showing the real first person perspective
Speaker 2:Mhmm.
Speaker 3:That is a true capability of of the product. And then our social team, what we were really clear on is you've got to drop people straight into the action. Mhmm. The way that you're gonna get them to buy in is actually showing it and not doing a lot of buildup before you get to the capability.
Speaker 2:You did an out of home you did an out of home campaign for don't work at Andoroll. Are you doing an out of home campaign for Eagle Eye? Is that relevant? How do you decide where to do what?
Speaker 3:So I personally am the biggest fan of out of home. Really? And I think there's there's reasons that I I love it that translate to things like NASCAR.
Speaker 2:It's
Speaker 3:an undervalued asset when you think about it in the context of a marketer.
Speaker 2:Sure.
Speaker 3:If you really understand how to use a canvas in an intentional way, you can really stand out. So when we think about outdoor, we're thinking about how it's gonna show up on social You guys do an amazing job of that as you think about the clips on on the show. Sure. For us, every time we're talking in outdoor Yep. We have one simple rule, say less.
Speaker 3:And and that it's like you have to have I it's another old Ogilvy role.
Speaker 2:Yep.
Speaker 3:He says seven words or less. I like to say five words or less on on it. So Yep. For Eagle Eye, we had a very simple line. Superpowers for superheroes Yep.
Speaker 3:And we demonstrate the capabilities. Or when we showcase Fury, which you guys were talking about with with Soren, we say, fight unfair. Yeah. And so you have these lines that have a really clear perspective that should make people immediately think about what you're saying. Whether they understand it in the moment or not, it should stick with them.
Speaker 2:Yeah. And I think it just we we we've seen we we review our out of home campaigns all the time on the show because we see them hit the timeline. We talk about them. And
Speaker 1:We love advertising.
Speaker 2:We love advertising. More than anyone else. Genuinely.
Speaker 1:I'd like to Maybe you like advertising as much as us, but there's not many.
Speaker 2:I'm loving it. The comments
Speaker 1:making doubt. For sure.
Speaker 2:But but it is it is hard when if you're a new startup and you're selling a piece of software that isn't highly visual and people aren't familiar with your brand, just like, as much as you might wanna be, ah, I'm David Ogilvie. I got this good tagline. It's just not gonna break through as opposed to, okay. If you show me a picture of a plane, even if it's a little bit look if even it looks different and the landing gear's a little bit different, I'm gonna know that's a drone. That's a plane.
Speaker 2:I'm that's a piece of military technology. There's all these cues that you can lean into. Also, Andrew is so big now. Like, just
Speaker 1:You must you must driving driving aware of it. Driving on the one zero one into SF. Yeah. The disparity and quality of the outdoor Tell the story.
Speaker 2:Tell us the story. Alright.
Speaker 3:So Trey tweets at me at, like, on Monday at 07:36AM. He's he's going to the office of Founders Fund and he's looking at his thirty seventh terrible enterprise SaaS ad on the on the 101. And he says, can we please just put a fury on a billboard on the 101 so I have to stop looking at these ads? And he tags at me directly. I I take this as a personal challenge.
Speaker 3:So when I worked at Gator, we talked about moving at the the speed of sport.
Speaker 1:Sure.
Speaker 3:So for me at this point, it was the challenge is on. We have to have something live the very next day. Yeah. So by the next day, we had an ad on the one zero one and I tweeted. I didn't even tell him I was doing this like right back at him.
Speaker 3:And credit to our team, again, moving quickly.
Speaker 2:Wow.
Speaker 3:It was a giant fury that said enter it said AI for fighter jets, not enterprise SaaS.
Speaker 2:Oh, there
Speaker 1:you go. That's amazing.
Speaker 2:I love that.
Speaker 1:Last time last time actually, it wasn't last trip but a a few trips ago to SF, I saw a billboard. I was so confused by it
Speaker 2:Mhmm.
Speaker 1:That I went to the website because I was like, who is
Speaker 2:This is happening.
Speaker 1:Who is running out of home in such a confusing way? I land on the website, still don't know what the product is. What are they doing? So I think that just that that clarity with out of home is so important where I not only saw the ad, I went, I I did what they wanted, I imagined, go to the website and I'm still come away from it being like, what what does this company do? They have enough money to to buy billboards.
Speaker 1:But, yeah, I still I mean, I still we we work with AdQuick. Obviously, we're biased. But I still think that out of home is the most undervalued form of advertising.
Speaker 3:100%. You hit one of the keywords on the head. We don't look at marketing as superficial or fluff. Marketing for us brings clarity. And when you apply clarity with with context, that's when out of home can be created, really any medium.
Speaker 3:Mhmm. But a couple examples I love are in Dayton Airport. If you fly into there, it's about ten minute drive to Wright Patterson Air Force Base. Mhmm. So, where we have our customer for what you referenced earlier, YFQ 44 A, is right there outside of Dayton.
Speaker 3:For those of you that know the history of Ohio, Dayton was also the the cradle, the birthplace of aviation where the Wright brothers were working on their original Wright Flyer. In fact, you're in that airport, you will see a replica of the Wright Flyer hanging from the ceiling. Right behind that, you will see a full scale Fury where it simply says actual size. And so that context, that ad would only work in the context of that airport. You put that in any other airport in America, it becomes less relevant.
Speaker 3:So whether it's on the 101 or whether it's in Dayton Airport, we're always thinking about the media placement as much as as the message. And you had Kugen asked about the Don't Work campaign. That's the one time we intentionally leaned into confusion.
Speaker 7:So Sure.
Speaker 3:Our campaign there, the brief to Jen and her team was was simple. I won an ad campaign. It reminds me of that campaign, if you remember, from Netflix. Netflix is a joke. Yeah.
Speaker 3:Where when you first see it, you're not sure if it's for Andruil or against Andruil.
Speaker 2:Sure.
Speaker 3:So the creative they came back with with which was beautiful and and just really thoughtful, was that we would do a corporate campaign that says work at Androl, and then of course was graffitied, was tagged, and everything that's was graffitied was saying don't work there. And what I gave our team a lot of credit, we'd already bought both URLs. So whether you go to work at androl.com or don't work at androl.com, you're still gonna land where we want you to land. But it just became provocative in a way that whether you're Boston, Seattle, or Atlanta, the three markets we're really focused on with our people team to recruit, you were gonna see our message and you couldn't you couldn't miss it. It was undeniable.
Speaker 1:What did some of your early mood boards look like for Anderol? I feel like Anderol had effectively first mover advantage in marketing in this new category of of like new players in defense and a lot of the like, when I think about the visual surrounding Andoril, I think like this is what a modern defense tech company should look like. Maybe that's because I grew up playing Call of Duty and Andoril looks like a lot of the visuals and even even the UI and stuff feels like it just fits into those worlds. And I know a lot of I'm sure a lot of our our armed forces feel the same way. But what what was like when you were mood boarding?
Speaker 1:I don't know if that was process that you went through with with Jen or other people on the team early on. Like, what kind of inspiration were you were you pulling in?
Speaker 3:Well, you hit there on a few words that are really important for us. When when we think about building this brand, we think about building it in a way that is open, that is modern, that is honest, and we do it in a way that we're really conscious that we're building it for the generation that ultimately is going be responsible for building national security of the present and the future. Mhmm. So, the ability to speak in a language, whether that's our voice, which I'm responsible and our team is responsible for, or our our identity that Jen and her team are responsible for, we're always thinking about the way that we can land something that feels really, really unique. And so, full credit in terms of the identity work goes to Jen and her team and Palmer and how they're building.
Speaker 3:And this extends from everything from the product identity to our industrial design, environmental to how we think about the brand identity. And then what I think our team does really well is really establish a clear voice that whether it's on the identity or on the voice, we talk about it as brutalist. Meaning, we're not speaking in opaque terms Mhmm. That is typical of the category. We're talking in really, really simple language that a fourteen year old person can understand.
Speaker 2:Mhmm.
Speaker 3:If a 14 year old can't see that and say, I get it, then Yeah. We've missed the mark.
Speaker 1:Yep.
Speaker 2:No render policy, only anime policy. There's a lot of anime. When do you pull anime off the shelf? Is there gonna be an anime video for Eagle Eye? Yes or no?
Speaker 2:And why or why not?
Speaker 3:Sure. So we talk a lot about this as the Andoril Cinematic Universe Yes.
Speaker 11:Is the way
Speaker 3:we like to describe it internally. And obviously, it's born out of Palmer's
Speaker 2:Of course.
Speaker 3:Passion for anime early on. But it's something that I'm so proud of in the context of of what our team has built Yeah. Because all of it is it's not using AI. It's all done, like, through digital
Speaker 1:Yeah.
Speaker 3:And brush, and it's, like, a really powerful tool for us because now we've created an aesthetic around it specific to us.
Speaker 2:And it makes it clear that any you can look at one frame and you're not confused. You're like so you can go into the future, and you can actually tell the story of what Andoril might be doing in ten years, and you're never confusing and you don't even get in the comments and debates, oh, that's CGI. It's like, of course, it came from a computer. Exactly.
Speaker 1:And it's right. We we we I I won't name the company, but John and I were having this debate over a a, defense tech, hard tech company that we were we there was a three minute video and we were just going frame by frame. And I was convinced that it was that it was like CGI or like AI generated. John was like, like I kinda wanna believe it was real. It They
Speaker 2:were cutting between so bad. So so they actually had a thing that would take off and fly.
Speaker 1:This is a company this is a company that's this is a company that's that's public. Right? So they're putting Who
Speaker 2:is it?
Speaker 1:Name names. No. It can yeah. Yeah. It it
Speaker 2:it can do vertical takeoff, but not move or something like that. It was weird. It was bizarre. Yeah. Small problem.
Speaker 2:But yeah. So so so for Eagle Eye, like, when when would you use that and why and and Well, I
Speaker 3:think you're speaking to what's important when we make these choices. It's a creative choice first.
Speaker 2:Sure. Sure. Sure.
Speaker 3:And we're thinking about it in the context of where is the really great room for lore and story building. Yeah. So what I'll tell you is with with Eagle Eye, we had great ability by showing the first person perspective. We thought that was the the most impactful way in. But what I will confirm is that there will be a chapter three
Speaker 2:Mhmm.
Speaker 3:To the animatic, the Androle Cinematic Universe. Okay. So just be ready. It's coming 2026.
Speaker 2:That's exciting. That's exciting. Talk about sports marketing. Is that also underrated like, out of home? What's your been your strategy?
Speaker 2:Did you dip your toe in with small tests? Now you're doing something big with NASCAR. Walk me through the thesis and what
Speaker 3:you're thinking. Right. So we dipped our toes with the the Chargers who are a partner of ours. They actually shared property with us. Their old training
Speaker 2:facility That's right.
Speaker 3:In Costa Mesa. They've now moved to a beautiful facility in El Segundo. But if you're at the game last night, Sunday Night Football where Aaron Rodgers looked like old man Rodgers, but the Chargers Is that
Speaker 1:good or bad? I didn't call it.
Speaker 3:Oh, Steelers got smoked. Luckily, I'm an Eagles fan, so I don't mind.
Speaker 1:Okay. Aaron Rodgers is on the seat?
Speaker 3:He's on the Steelers. Oh, come on, Jordy.
Speaker 1:No. Seriously. I seriously we don't know.
Speaker 2:I thought he was just on the Pat McAfee show.
Speaker 3:He might be full time
Speaker 2:thought he was full time Pat McAfee.
Speaker 3:So if you were there though, what I think is super cool about a partnership like that is we dipped our toes Yeah. Is we had 16 veterans from Andoril
Speaker 2:Okay.
Speaker 3:That were there. Cool. And the way they got to go to that game is that a colleague from our our office, from our team nominated them and said why. And it was grounded in their character. It was grounded in their service.
Speaker 3:Why they were selected to represent our company.
Speaker 1:Mhmm.
Speaker 3:And so if you were there watching on their eighties 80 yard infinity screen, you saw our veterans being recognized there. And also
Speaker 11:That's true.
Speaker 3:How much it meant to them Yeah. To be there. So everything when we look at sports marketing, we look at it as a way to to find the ways that we can, yes, find value
Speaker 1:Mhmm.
Speaker 3:But also to stand out in a way that we have the ability to do something unique Mhmm. And that we can honor and and reach the military and defense community. Mhmm. So that's why you see us leaning into things like NFL or, of course, NASCAR. NASCAR, more than any other sport, over indexes on that military and defense community.
Speaker 3:Has about four x the ratings of f one in America. Of course. And so while we see so much over saturation in f one Yeah. The amount the economics of a deal there
Speaker 2:Mhmm.
Speaker 3:To be a mid level sponsor on a mid level team are
Speaker 1:I still know. The the disparity in earnings too from when you look at the you know, let's say that the twentieth person on the grid is probably making a couple million a year from a salary standpoint, and then some of the you could be like top 20 in NASCAR too, and you're just you're earning a good living. And so the opportunities for companies to support a sport that so many Americans love and be able to have be a meaningful player in that is is amazing.
Speaker 7:And this
Speaker 3:is a call to great brands in this country, consumer brands, who have exited that sport.
Speaker 2:Yeah.
Speaker 3:I mean, NASCAR is on on the up and up. And for us, we had this exceptional opportunity to sponsor a race on a military base. It could not be more of a direct target for And what I what I love so much about our company, this applies to whether you're working in design, video production, marketing, comms, is we have the full trust of our founders
Speaker 2:Yeah.
Speaker 3:To make these calls. We keep them directly in the loop. But they they trust us to make these big swings. And so next June on that base, we're gonna show up in a way that no one else in the sport does. And we have a partnership directly with Hendrix Motorsports.
Speaker 2:Okay.
Speaker 3:And so that's Jeff Gordon's team.
Speaker 2:Yeah.
Speaker 3:And we've got William Byron who won the regular season. Yeah. Hendrix also has a defense division. Like there's all these connective tissues that we can do storytelling year round.
Speaker 2:Yep. Talk about the menu of options for working with NASCAR broadly. It sounds like the Andoril two fifty, it's sponsored of a race. There's also team level sponsors, individual driver sponsorships. I mean, I'm sure some brands are out there paying for promoted posts on the some drivers' Instagram, one off.
Speaker 2:Right? How did you land on where you landed, and do you think this will continue to grow and mutate? Because, you know, what we've seen with, like, Red Bull, like, they have one f one team. There's no there's no Red Bull race in f one. It's just the team.
Speaker 2:And so I'm interested to think about what what's out there on the menu, how you landed, where you landed.
Speaker 3:Sure. And I'll talk this about this in the context of NASCAR relative to another big swing of ours Ohio State.
Speaker 2:Sure.
Speaker 3:Sure. So with NASCAR, it was about how do we make a a big splash on a major state. Yep. Especially with America two fifty coming up. Totally.
Speaker 3:I mean, it rights itself especially in that first year. Sure. And with that deal, we have the rights to to activate with a specific team. There's actually an activation fund built into our deal
Speaker 2:Okay.
Speaker 3:To work with this specific team.
Speaker 2:Oh, okay.
Speaker 3:We met with eight teams on the grid Cool. And found the one that really aligned with our values. That's how we end up with Henrik
Speaker 2:and we Makes sense.
Speaker 3:With Williams specifically as our driver. But there's many different ways in. For us, we see this as a relationship that we fully intend to grow. Yep.
Speaker 2:We're gonna
Speaker 3:be with the sport for at least five years. I I expect that to be much Yeah. Much longer than that as the sport itself is growing. And then you look at that in contrast with Ohio State. Yeah.
Speaker 3:Why did we do the deal with Ohio State? Well, we're building Arsenal One
Speaker 9:Of course.
Speaker 3:Our 5,000,000 square foot manufacturing facility about ten minutes away from the heart of Ohio State campus. We're bringing 4,000 jobs directly, another 4,000 jobs indirectly through the build of Arsenal 1. And so for us, we know the the best way to win the hearts and minds of of Ohioans is talking to Ohio State and not doing it in a superficial way about just a sport sponsorship
Speaker 2:Yeah.
Speaker 3:But actually thinking about the ways in which we're gonna work together for job placement
Speaker 7:Yep.
Speaker 3:For STEM programs, for community engagement, for military community, and how we make sure that they have skill bridge. And so for us, those are examples where we go broad with NASCAR and we go deep with Ohio State.
Speaker 2:That's a great deflection from just the truth, which is the Tray's from Ohio. And so he's gotta go
Speaker 1:all in.
Speaker 3:I mean, Tray would have a sponsor in the Bengals right now if
Speaker 2:he could. Yeah. No. I wouldn't be surprised.
Speaker 8:You're gonna be
Speaker 3:seven? I don't know.
Speaker 2:He's he's gonna do it. He's gonna do What what so what else is is special about this about this race? Walk me through, like, what race weekend, what race week looks like. I mean, I imagine a bunch of people from the company are coming out. Like, what are all the different ways that you are getting the lift out of it?
Speaker 3:100%. We see already, whether it's from people on the hill Yeah. To our our Sure. Investor community.
Speaker 2:Bringing out.
Speaker 3:The second we announced that we're doing a race, we were getting calls from from everyone.
Speaker 2:Yeah.
Speaker 3:And I'm really excited because I think this will be a moment that becomes a real focal point
Speaker 1:Cool.
Speaker 3:For American two fifty at large. So we're really hopeful for everyone that you could possibly imagine to to show up to this race. Yeah. So as we lead up to it, I think what you'll see is us start to drop content away that you typically don't see in sports. So Sure.
Speaker 3:Whether it's the scheme which we just finalized on Friday
Speaker 2:Oh, sure.
Speaker 3:When we finally released that
Speaker 2:Mhmm.
Speaker 3:I mean, our design team, like, knocked out of the park to the helmet To steam delivery essentially? Exactly. Delivery to the fire suit Mhmm. To the die cast cars. We're gonna make every single thing a moment.
Speaker 3:And then we got space on the base that we could do some really special demonstrations of our product capabilities. Yeah. So we're working right now with NASCAR and with the Navy to think about the ways that we can showcase our our product on this.
Speaker 2:So in in theory, like, yeah, like a
Speaker 1:Fury flyover?
Speaker 3:Fury flyover? I mean, sooner or later. I'd like to see. Is what I'll say. That Test
Speaker 2:that we've done
Speaker 1:or something.
Speaker 3:Last week, as you alluded to earlier, our first flight Yeah. And just a massive shout out to our our air dominance division. Like, for them to accomplish what they did in just over five hundred days from clean sheet to first flight. Wow. It's unreal.
Speaker 3:It's unheard of in in the industry. All like at the touch of a button. Yeah. And it was really cool to to be a small part of that and to observe it. But I think it goes from there to first flight to how do we start to think about ways that we can demonstrate this more clearly in public.
Speaker 2:Dive LD demo. You gotta be just like, yeah, it's down there.
Speaker 3:Yeah. Yeah.
Speaker 1:Guide makes Yeah. Can't see it.
Speaker 3:Dive We're gonna put our
Speaker 2:Dive XL. Yeah. It's down there. Yeah. Trust us.
Speaker 2:It's down there.
Speaker 1:Gotta do a live show from from under the seat.
Speaker 2:You'll like, and we're showing off our new stealth technology.
Speaker 1:Space in there.
Speaker 3:I wanna share some fun facts Please. To from the Don't Work at Andruil campaign.
Speaker 2:Oh, yeah.
Speaker 3:You can pivot back. There's two stories I'd love to share here. One is how this originated. Mhmm. So, I'm about three months in and friend of the show, Matt Grim Yeah.
Speaker 3:I get a Slack from him that simply says, why do you hate interns? And I'm trying to distill like the context behind this. And I realized it's because I had responded to to our recruiting team about a week earlier. They had shared a post from I'll also redact the name of this company. Their intern post where it's like 30 smiling interns in front of the logo saying Okay.
Speaker 3:First day company. And they said, hey, can we do this? And I said, absolutely not. We're not putting that out there. That's not the ethos of our company.
Speaker 2:Sure.
Speaker 3:And so, I said to Grim, I'm like, I don't hate interns. I hate shitty x company inspired intern posts. I said, if we're going to talk about what it's like to work here Yeah. We should tell the people all the reasons they shouldn't.
Speaker 2:Sure. Sure.
Speaker 3:And so, Grimm and I went back and forth and started to outline what ended becoming the the working script. And it was largely drawn from Palmer's own words Yeah. Yeah. Trey's words Sure. Lulu's words early days of saying, hey, we're a weapons company.
Speaker 2:Yeah. Yeah.
Speaker 3:And if you don't want to work on that, if you don't believe in the mission, if you don't understand why we build what we build, if you're not ready to work your butts off here nonstop if you don't love America and are proud to say it
Speaker 7:Yeah.
Speaker 3:Then don't work here. It's like no disrespect. But the sooner we understand that about each other, the better. And what I love so much about Grimm, two words, ship it. Yeah.
Speaker 3:And from there, that's all we needed. And then it was a group of five of us with the our talented creative team, Trevor, Alex, Ben, with Jen in a Was room
Speaker 2:there ever a moment where you felt like if you didn't put that out, you would run the risk of people showing up just because Andrew was like a hot stock? And they would be like, wait a minute. Like, I actually have like, I think because it seems crazy to
Speaker 3:me. 100%. Mean, what we'd out is what I'd call the mercenaries. The people that are just there, like, try to get the Andoril equity.
Speaker 2:Sure. Sure.
Speaker 3:Who are saying, this is extremely hard.
Speaker 2:It's gonna be hard.
Speaker 3:Guess what? Like, you're not gonna have fun here. If all you care about is cash
Speaker 2:Okay. Yeah.
Speaker 3:Trying to get equity Yeah.
Speaker 2:Yeah. Yeah.
Speaker 3:Do not come here. No. You know, we see it because I do the orientation every two weeks Yeah. And we have one fifty, 200 new people coming in. And I ask people, I'm like, who saw this before you started?
Speaker 3:Every single hand goes up. So what you're speaking to is the greatest measure of success
Speaker 2:Yeah.
Speaker 3:Is that it was a filter Yeah. For the people that were not mission aligned.
Speaker 2:Yeah.
Speaker 3:Yeah. On top of that, you talk about metrics, 30% lift in applications because of that campaign.
Speaker 2:Yeah. Wait. Wait. What is the intern cycle like now? Because it feels like there's more and more people dropping out of college early.
Speaker 2:Is Andrew all set up to deal with that? I mean, I feel like there's some people who might start intern and then take a gap semester and then wind up just hanging out forever and like right there. Tyler started as an intern and then he took a gap semester. And
Speaker 3:Is Tyler required to dress like you every day?
Speaker 2:Well, yeah. We have like a, you know, general if ever if everyone's wearing
Speaker 1:White suits today because the markets are up.
Speaker 2:The market's up, so we wear white. Love it. But, but I am interested. Like, Palantir has the meritocracy thing going on. There's definitely this idea I mean, this goes to back to Peter Thiel and Founders Fund and, like, a lot of, just the idea that, like, is the internship even necessary?
Speaker 2:Like, what are the roles where the internship makes sense versus just, hey. You're ready. Get in get in the league.
Speaker 3:It's it's a perfect question, especially for right now because we're talking about this all the way through our executive ranks and with our people team about what it actually means to to come here and what matters.
Speaker 1:Yeah.
Speaker 3:And we we call it the the Andoril Forge program, but we're working on the campaign right now that will be the the next sequel, if you will, to to Don't Work With Andoril
Speaker 1:Sure.
Speaker 3:That won't tell people what we aren't. It's gonna speak about what we are Sure. And what it means to work here and and the importance of of work. Cool. And so it matters way less to us
Speaker 2:Yeah.
Speaker 3:About your quote unquote credentials. We don't care. Yeah. We care about the the work that you're gonna do, the alignment to the mission, and your ability to add value.
Speaker 2:Yeah. Yeah. It's awesome.
Speaker 1:Does By the way, I don't know
Speaker 3:if you know this even, Jordy, but we started our our campaign for Don't Work at Andoril with our intern Yeah. Taking over. So like midnight, my buddy Sean and I were crushing, I think, Core's lights. And we we posted just simply
Speaker 1:That's great.
Speaker 3:Don't work at Andoril. Yeah. And we had somebody give us really good counsel because it was just gonna be And this this man of mystery, that, rhymes with Don Hugen said to us, he said, you gotta go way way harder than that.
Speaker 2:Like There's such a fertile ground. Like, there's so much Andoril lore that there's so many different elements that you could pull from, from different things Palmer said, sword art all online. Pacific rim? Pacific rim robots.
Speaker 3:So there's about ten ten tweets that our intern wrote that are actually ghostwritten by
Speaker 2:I think I sent you like 25 and, and and you picked you picked
Speaker 1:Oh, right. Right. Right. I know. I know this.
Speaker 2:I know this story. Yeah. Yeah. Yeah. Yeah.
Speaker 2:One day we need to post the ones that didn't make the cut because I love it. There might have been some over the line. So good.
Speaker 1:Last question. Do you think that advertising has changed in the last fifty years?
Speaker 2:Even
Speaker 1:in the last hundred years? Because when I when I hear you talk, you're speaking, you know, running the marketing organization of of one of the best modern brands. Right? People can debate people can debate on on whether they like the brand or not because it's obviously polarizing, but great brands are polarizing. And when I think about the strategy, it's like ultra clear communication, strong visuals, leveraging out of home strategically, you know, having these sort of layered strategies, thinking about all these different architects.
Speaker 1:Feels like all the conversations that a that a strong marketing brand organization would be having fifty years ago. And so it's interesting. I I think it's interesting that we have the Internet, which is like the best marketing channel in history, and yet the marketing strategy hasn't changed very much at all since the old days, you know.
Speaker 3:Yeah. What you're describing to me is that what's changed is the medium. Mhmm. What hasn't changed is the desire from an audience for a really clear story.
Speaker 1:Mhmm.
Speaker 3:Yeah. And ultimately, that's what we're doing, is we're bringing great craft to our storytelling, which most importantly is highlighting the incredible important work that our engineers and operators are doing for our warfighters. And that's the thing that is consistent with us. And and the other thing I think you said is that we understand that we're it's not for everyone. You know, what was important to us is that we have a really, really clear message that people understand what we stand for whether you agree with it or not.
Speaker 3:And that is what I I love because I'm so mission aligned to what we're building that I find it a great privilege and responsibility to bring the same type of disruptive approach to marketing that we are bringing to how we approach contracts, how we think about research and development, how we think about engineering or AI or design. And ultimately, there's no other place on on Earth I'd rather be.
Speaker 1:Fantastic. That's a great place to end it.
Speaker 2:Well, thank you so much for coming I'm so excited for the Andoril two fifty next year.
Speaker 3:Next year.
Speaker 2:We'll be there. I want to be there.
Speaker 1:By the way, here's
Speaker 3:a final idea for you guys. Yes. My second time officially on.
Speaker 2:Yes.
Speaker 3:You guys need like an SNL Yes. Five timer jacket.
Speaker 2:Oh, yeah.
Speaker 3:When you guys get to that level
Speaker 2:Yeah.
Speaker 3:That'd be great. You guys break out some new swag.
Speaker 1:For sure. We got it. For sure. Got some got see got some way.
Speaker 3:You guys.
Speaker 7:Great to
Speaker 1:see you.
Speaker 2:Thanks so much for coming by. Oh. What else? You you got something else in the bag?
Speaker 1:What do we got? What do we got? Oh. There we go. Fresh out of cool.
Speaker 1:The twenty four.
Speaker 2:Size. Great. Thank you.
Speaker 1:We go. This is hard. Very cool.
Speaker 2:Thank you so much.
Speaker 1:Good to see you. See you soon.
Speaker 2:This is good. Every everyone needs a number for sure. There you go. I like it.
Speaker 1:Linear. Let's Purpose built tools. Back to Linear.
Speaker 2:Planning and building products. Meet the system for modern software development. Streamline issues, projects, and product road maps. There is a video of an office tour, that has been burning up the timeline. I feel like we should play this.
Speaker 1:Play it.
Speaker 2:If we can pull it up. It's gonna be about, two minutes of the, from Philip Cozara. I spent $1,500,000 building our office after raising a seed round. The seed one point five used to be the total seed round. Now, I guess it's a $30,000,000.
Speaker 1:There's some $1,500,000 series a's out there.
Speaker 2:There are.
Speaker 1:If you go back like
Speaker 2:Oh, for sure. For sure.
Speaker 1:Ten, fifteen years.
Speaker 2:So so so let's play this, and I will be back in just a minute.
Speaker 1:Edward raised $30,000,000 for this office. Let's go meet the CEO. What what is this? You're here for an laughing because cameras tracking beyond million dollars went.
Speaker 12:Alright. But let's be quick. Alright? You going surfing? Yeah.
Speaker 12:See you later. Come on in.
Speaker 1:This is Let's track how many times they talk about
Speaker 12:surfing. Boards. We got kite surfing equipment.
Speaker 1:Oh, good. They spent it on vibes.
Speaker 12:Coming through. This is gonna be the sauna room. We're now more like a sauna closet, but all of our kite surfing equipment is here, and our kayaks are here.
Speaker 1:I'm gonna count kayaks.
Speaker 12:He's one of our first investors. He joined the company full time.
Speaker 1:From one employee to 18 in a year. You guys are going fast.
Speaker 12:Everyone is doing something, having meetings, cracked engineers over here. We got Robert. Robert doesn't actually do work. He's actually looking at sonas right now. Our new product is actually called Sona because this man actually came up with the idea while zoning.
Speaker 1:They look cool. Where are they from?
Speaker 12:Hello. Where are you from? From Iceland. Matthias?
Speaker 1:That guy looks like he's the only one actually working.
Speaker 12:Our bucket infrastructure engineers do not like to be disturbed. Matthias, where
Speaker 1:are from? I'm from Austria.
Speaker 12:Can you point at the Golden Gate Bridge?
Speaker 8:It's right over there.
Speaker 12:Let me zoom in on that. Now, coming through. We got
Speaker 1:Any fun stuff here or is it just nerd gear? Let me Alright.
Speaker 12:This is our movie theater, but how many times did you guys watch a movie here? Well, I actually tried to get Nikki to find our PS four, but unfortunately, we work too much and we don't have time to do bullshit. One of my favorite things in the office is every
Speaker 2:I'm back.
Speaker 12:Something
Speaker 2:I'm back. Okay. I have a take. I have a take. Let's break it down.
Speaker 2:I don't know what this company does. This they they put out this whole video. They went viral, but it's unclear what they actually are selling. Like, it it it
Speaker 1:They're selling Nordic vibes. Yeah. I mean, the vibes are amazing. Our European soul.
Speaker 2:And I understand that it's, like, targeted at hiring because it's like, hey, you know, we have this beautiful office. You should come work here. You should come build on stuff.
Speaker 1:Yeah. But The challenge is unless the company is, like, winning and getting better every single day, the surfboards start to
Speaker 2:For sure. Like, there was a quote about like, hey. Like, you know, look at what Jeff Bezos is working on the DoorDash back in the day. The other thing is, like, there there's a little I think this goes over way differently if this is done by an external influencer. Like, there's been so much attention from the guts dough.
Speaker 1:I know what's happening.
Speaker 2:No. No. Oh, wait. Wait. Really?
Speaker 2:Okay. It feels like it's it feels like it's the founder posting.
Speaker 1:I He's post he's posting it, but it's it's I think
Speaker 2:Oh, I guess their product, Sauna AI? Okay. So they they have a It's
Speaker 1:building the future of work with Sauna. What is We love Sauna's. So Sauna? Can't Thanks, folks. Exhale.
Speaker 1:Yeah. I mean
Speaker 2:I oh, it's a two. You turn your to dos into done. AI powered workspace. It's a AI to do list, something like that. But but did like like, there were people that did this exact video on the Gunda.
Speaker 2:Like, they went to Rainmaker and they were like, like, look at the gym stuff. You can you can lift weights here. Like, you there's people over there working. Or like, I I literally went and filmed a video somewhat like this, at Niros. Although, they were in, like, a garage, and they were they were literally grinding.
Speaker 1:They didn't have any surfboards. I have PTSD because I I I knew I knew a founder back in the day that every he would always go surfing because he needed to clear his head. Sick. And I would always be thinking like, okay, like, eventually your head's gotta be clear. You've gotta you've gotta fix the product.
Speaker 1:You can just fix the product and ship another product and make it work.
Speaker 2:Brother, I think your if your head's unclearable, like, we got a problem here.
Speaker 1:Yeah. And and I don't know. Surfing surf as somebody who's, you know, grown up surfing, basically, every every at least every week since I've been at been a Yeah. A kid, I don't find surfing, especially in Northern California, to be compatible with work. And the reason Why?
Speaker 2:Is that Wait. Like a full it takes you out the full day?
Speaker 1:Or So so the challenge is that in Northern California, even if you're wearing a a five four wetsuit, which is like basically this thickest
Speaker 2:That's five mil?
Speaker 1:Five millimeters on the chest Oh. Four on the arms.
Speaker 2:What about seven mil wetsuits?
Speaker 1:You can get those but like
Speaker 2:It's really
Speaker 1:you you get that for like a trip to Alaska or something like that. That's why And the challenge is you get cold enough
Speaker 2:Yeah.
Speaker 1:Surfing in Northern California Sure. Even with a five four that you spend the entire, like, next, like, few hours, like, body is
Speaker 2:I just I I was just laughing that we're, like, breaking down, like like like, it like, if he if he if he lived just just two hours south, it'd be totally fine.
Speaker 1:No. I disagree. I disagree. It's impossible. Like, if
Speaker 2:he's just analyzing the wetsuit.
Speaker 1:No. No. Roll back to tape. So you
Speaker 2:What type of wetsuit did he have? If he's in a if he's in
Speaker 1:a No.
Speaker 2:It doesn't matter. It doesn't matter.
Speaker 1:You could be in a five four, four three, three two. You could be trunking it. But you get cold enough that your body uses so much energy to reheat. Yeah. Yeah.
Speaker 1:And you just become slow.
Speaker 2:Yeah. Yeah.
Speaker 1:You just become slow. Okay. And I would struggle with this growing up because I'd go surf after school and then I'd be doing homework and I'd be like You bad at I can't. Like, I I just be
Speaker 2:Okay. Okay.
Speaker 1:You know Yeah. Incapable of of Yeah. Of of real productivity. So I'm against surfing in the in
Speaker 2:During the work week, basically.
Speaker 1:During yeah. I basically don't surf during the work week. I'll surf sometimes in the evenings Mhmm. In
Speaker 2:the yeah. Once you're done with your day.
Speaker 1:They would they could
Speaker 2:be doing that. They could they could have, surfboards Yeah. But he mentioned
Speaker 1:surfing or kite boarding or kite surfing or surfing or kayaking, like, so many at least five times in Yeah. Yeah. Ryan says there are many doing Dawn Patrol in SF every day. I agree there are. I just I just wouldn't be, VP of vibes.
Speaker 1:Yeah. Yeah. VP of vibe VP of vibes engineering customer vibe distribution.
Speaker 2:I I certainly understand why people are are, saying that this is maybe a little bit too lackadaisical, when you're in the trenches of the startup culture.
Speaker 1:It was also kind of clickbait because he said the effective cost is only 250 k.
Speaker 2:Oh, interesting. Okay. So spent 1,500,000.0, but it
Speaker 1:And he got a bunch of like TI Okay.
Speaker 2:Well, that's cool.
Speaker 1:Anyways,
Speaker 2:Certainly seems like a nice
Speaker 1:Cool environment.
Speaker 2:Hang out and, nothing will matter if you build the business. You could have made you could have made the same argument about Facebook. Facebook was drinking beers in the office, you know. There's a famous interview. Mark Zuckerberg sitting there chugging a beer out of a solo cup, a red solo cup.
Speaker 2:And he was and and the interviewer is like, are you sure you wanna be chugging this beer in this video? And he's like, it's okay.
Speaker 1:It is just funny because But you gotta hyperscaler. If Tyler was
Speaker 2:Drinking like this.
Speaker 1:If Tyler went kayaking
Speaker 2:Yes.
Speaker 1:After the after the show Yeah. I would just say to him, like, why don't you just and then came back and and kept working. Mhmm. I'd be like, why don't you just do your work And then and go kayak.
Speaker 2:True. True.
Speaker 1:Like, why do we need to why do we need to combine these?
Speaker 2:I don't know. It seems seems like mostly solvable if they if the kayaking, kite surfing, surfing marathon happens at the right time of the day.
Speaker 1:Tyler, put a calendar put a calendar invite on our calendars for three years from now to check back on word on this word wearer video. We'll revisit it because if they have crazy product market fit, they're
Speaker 2:gonna the CEO
Speaker 1:They're gonna look like being a
Speaker 2:a world class surfer and becomes like the next Kelly Slater. And just actually shreds
Speaker 1:Just rolls the whole He's like, we're a surfing company now.
Speaker 2:I am a professional surfer.
Speaker 1:I we earn revenue
Speaker 2:Yeah. Exactly. That would be I would crush. And then you'd be eating your words, Jordy. You'd be eating your words.
Speaker 1:No. We very well we very well could be, eating our words in in just a couple years.
Speaker 2:Of course. Like the actual product work.
Speaker 1:Gabe says, why don't you bring your work to the kayak side?
Speaker 2:I like that. I also like numeral. Sales tax for autopilot. Spend less than five minutes per month on sales tax compliance.
Speaker 1:Ryan says, I'm gonna apply. Need somewhere to store my boat trailer. Yeah. People just start applying applying because they need they need a place to store their gear. They're like, this place seems really well.
Speaker 2:I mean, at the same time, like like, when you're when like like, the when you're in a crowded market, the the taste of virality, like, the the temptation of, like, oh, this is good content. We should go viral with this, has gotta be overwhelming. Because it's like it's like no one's heard of the company yet. It's brand new, you have this opportunity to go do something that can get a lot of attention.
Speaker 1:I think think he he invited criticism because he started it off with clickbait being like, spent 1 and a half million on our office.
Speaker 2:Yes. Yes. Yes. Yes. There's a little bit of too far.
Speaker 2:I also yeah. I think I think having someone else do this is is better. Have have an actual TikToker come by instead of doing it as an in house thing. It just has a different aesthetic. Like, if you get stopped on the street, what do you do for a living?
Speaker 2:That's different than paying someone to do a what do you do for a living video about you.
Speaker 1:I would say Right? Snowflake is gonna beat in in Q1.
Speaker 2:That is one of the greatest videos ever. Just like fin dot a I, one of the greatest actually, the greatest AI agent for customer service. They're number one in performance benchmarks. They're number one in competitive bake offs. They have a number one ranking on g two.
Speaker 2:Let's go to the Tyler cam again for some reason. What's up with Tyler? Is that the oh, he's slapping. He's slapping.
Speaker 1:Do you wanna do you think we should have kayaks in the workplace?
Speaker 6:Yes. Yes? I also think Do
Speaker 2:you like kayaking?
Speaker 6:Probably. I've Probably. I've gotten, like, once or twice.
Speaker 2:Okay. Well, our next guest is in the Restream waiting room. We have Kaz from Opendoor in the TV panel trim. Welcome to the stream. How are you doing?
Speaker 1:Here he is. Welcome.
Speaker 7:Thanks for having me, guys. I I wanna go on the record as being pro kayak.
Speaker 1:Pro kayak. But kayaking in the workplace. Yes, man.
Speaker 2:What point? At what point? In at at at noon on a Tuesday, you want your whole workforce going into the frigid ice cold sea with a four millimeter wetsuit and coming back cold and spending the rest of the day warming up?
Speaker 7:First of all, I grew up in Canada, so we don't wear wetsuits. We just go kayaking. I don't
Speaker 2:know what
Speaker 1:you guys do. Okay. Okay. What's the biggest fish you've ever caught? What's the biggest fish you've ever caught?
Speaker 7:I am I I honestly, man, this is like my my brother-in-law goes fishing off the coast of British Columbia and catches these massive salmons.
Speaker 2:Woah.
Speaker 7:I am a I'm terrible. Okay. I'm objectively the worst guy to go out fishing with.
Speaker 2:That's Like, I will lose
Speaker 7:your luck. I will not catch you anything. It'll be terrible.
Speaker 1:Oh, wow.
Speaker 7:I'll fix your Wi Fi.
Speaker 1:Okay. There you go.
Speaker 2:Okay. There
Speaker 1:you go. That's helpful.
Speaker 2:Well, caught a big fish with OpenDoor. Congratulations on the new gig. I don't know if you remember, but we've actually, emailed very briefly while you were at, at Shopify. You saved my entire company in, like, the in, like, the, in the span of, like, two email exchanges. So I've always been extremely thankful to you and just Shopify general generally.
Speaker 2:But, can you since this is the first time on the show, can you give us a little bit of backstory on how you wound up at Opendoor, what the, what the vision was? Just, like, kind of how this all came together because it's such a fascinating story to me.
Speaker 7:I mean, I I I think this story has now been fully leaked. I would not have told it if it just had not been, like, fully told by other people. But look, I've been I I loved my job at Shopify. I genuinely honestly thought it was gonna be my forever job.
Speaker 1:Mhmm.
Speaker 7:And I just I was not planning on leaving. But I became a little obsessed with Opendoor maybe February. Mhmm. Where like I as a kid, I grew up my mom had a corner store and I would grow up I grew up with like a stopwatch timing the cashiers. Oh.
Speaker 7:So like, I have this very odd obsession with like operationally well run places.
Speaker 2:Uh-huh.
Speaker 7:And from the outside open door looked like a great opportunity being poorly run.
Speaker 2:Mhmm.
Speaker 7:So, like, sometime in February, almost as a joke that just ought and would just not leave my brain, I texted Keith to a boy saying, hey. I'm thinking of just buying OpenDoor and taking it private because it just needs to be run better. Then my my secure. Just, like, thought this was, like, an interesting hobby for me to figure out how I could just, at the side of my desk, fix this company that I wasn't running. And I became more and more obsessed with it because there's a very real thing that matters, man.
Speaker 7:Like, most of us that work in software don't get the opportunity to say, hey. The thing we do has a real world impact on actual families. Right? And the very real thing that happens if you grow up in a home that your parents owned. Like, your educational outcomes are better.
Speaker 7:There's less crime in your neighborhood. Like, same same family, same type of thing. If they own a home, things turn out better. So I became just obsessed with this company whose job it was to make buying and selling a home easier. And like most other things in the world, when you reduce friction, you get more of the thing.
Speaker 7:So if you think homeownership is good, reducing friction at will lead to more of it. But I just kinda like given up on this idea of taking the company private because the company had this significant run and well, I didn't have enough money to take it private anymore. Mhmm. So
Speaker 1:There was a brief window. You were daydreaming about it. That was the Yeah.
Speaker 7:So and then it was on on it was a Sunday, like, in I wanna say mid August, like, August, my wife and I were on our way to church. I got a call from Paul DiVersa, who's a exec recruiter, I picked up the call and I said, it's a true story. And Paul and I had Paul had been trying to get me to go go to a couple other places, and I picked up the call. I'm like, Paul, I'm on my way to on my way to church. I don't have time.
Speaker 7:I appreciate it. Like, I'm not interested in whatever it is you're about to pitch me. Maybe if it's open door, let's talk.
Speaker 1:And
Speaker 7:then he said, it's open door. How soon can you be on a plane?
Speaker 1:Wow. Wow.
Speaker 7:And we went to church, came back, I got on a plane. Yeah. And the whole thing, the whole process took maybe two weeks Wow. From like that call to me starting.
Speaker 1:How much did you, like, how much did you rely on your network to help you make that decision? Maybe some trusted advisers. Because I imagine there when when I when I saw that you that you were announced that you took the job, my immediate thought is like, you know, going from Shopify, which is this, like, beloved, you know, incredibly well run company that you can have so much impact on because it's it's, like, one of the one of the few platforms in the world that is just, like, so undeniably pro entrepreneurship, and entrepreneurship is so life changing. And if you care about impact, you know, it's it's hard to kinda meet your bar. Not to mention that jumping in at Opendoor would go from probably like a relatively calm work environment to one of the most, like, crazy intensive, high pressure environment where, you know, I'm sure from, like, a the amount of inbound messages that you get running Opendoor is probably, like, a 100 times the messages that that, like, a company, like, a 100 times your size gets.
Speaker 1:You know? And so, like, it it it is wildly different kind of, life. I
Speaker 7:don't know. I mean, look. I think Shopify is a relatively intense place to work for all the good reasons, and you kinda wanna work at intense places because you only get one career. But I remember, like, when I was thinking of leaving Facebook to go to Shopify, literally everyone I I talked to said don't do it. Like, single person I talked to about leaving Facebook, going to Shopify said don't do it.
Speaker 7:It's a terrible company. It's among the most shorted companies in history. Like, it was exceedingly shorted. It had a really bad it was a churning, like, I had like I had like lots of like the day I joined Citron, put out a, like, a big research report saying Shopify will go bankrupt in, like, twelve months.
Speaker 2:Woah.
Speaker 7:So I remember, like, So everyone, like, talked to back then in 2019 told me, don't join Shopify. Terrible idea.
Speaker 1:And what was what it like, what did you what did you see that that other people missed?
Speaker 7:Look, I thought the mission was a worthwhile mission and that it was very clear to me that I was the type of person who could help. Like, I thought the mission was important, the company had done a lot of good, and I could help. I like, I couldn't see myself at a bunch of other companies, but I could see myself helping Shopify. And I, like, I became the merchant services guy at Shopify. Right?
Speaker 7:I ran the second half of the business. So Shopify has two parts, SaaS and services. I ran services for nearly my entire time there, and then Toby asked me to become the COO, and I ran a bunch of other things. But I remember when I was thinking about going to Shopify, like, basically, only two things that convinced me to do it were I prayed and I thought it was the right decision. And then I sat down with wife and I said, hey.
Speaker 7:This is almost certainly a bad idea. Like, we're gonna move to like, we're gonna move. We had a kid who was less than one, and this probably won't work out, but I think this is a worthwhile mission. And I think I can help. And then she said, look.
Speaker 7:It's our job to spend our marriage doing things that will make the world a better place. Right? We call it leaving a dent in the world. So when it came time to the open door one, I didn't, like, I gen I talked to Keith because I've known Keith Raboy for a while. But I was I was just I talked to my wife.
Speaker 7:I prayed, and I'm I and I thought I could, like, have an outsized impact on the company just because the type of thing I tend to be good at is a type of thing that a company seems to need. I'm not look. I'm no one's idea of a corporate executive. I cuss a lot. I grew up as a nerd.
Speaker 7:Like, I didn't do all that well in my finance undergrad courses. Like, I'm I'm like, I'm a product manager. Right? I'm like, so this is I don't like, this is how I dress. So I felt like it was a very real thing.
Speaker 7:But at Open Door, it felt like I could do well given the what the company's mission was.
Speaker 2:Mhmm.
Speaker 7:And I thought if we could do our job, it just would be good for the world. So
Speaker 2:So we yeah. What what what's the how how do you think about the opportunity? How do you think about the shape of the business in are you thinking in a a decade? Are you thinking in thirty year time frame? Like, how do you think about the long term strategy, what the opportunity is, what you wanna fix in the short term, medium term, long term?
Speaker 2:How you
Speaker 7:Dude, we like, every ship every week. Like, we ship every week. Fuck fuck ten years. We ship every single week. Like, our job is to ship product every single week to tilt the world in favor of homeowners and people working hard to become homeowners.
Speaker 7:We ship every week. Mhmm. Something changes every single week. We measure ourselves on a weekly basis. We now have a public dashboard that we use internally.
Speaker 7:We just publish it to the world.
Speaker 2:Mhmm.
Speaker 7:So you can see our internal dashboards externally.
Speaker 2:Yeah. So what are the levers that you can pull on a week to week basis? Like, what's an example of something that you can you can roll out that actually improves the experience?
Speaker 7:I mean, I can tell you I can tell you a product that took us Yeah. Almost exactly one week to launch. Yeah. We launched this thing we call peace of mind guarantee.
Speaker 2:Okay.
Speaker 7:So if you ever bought a house Yeah. I remember the first house I bought Yeah. And the first night I slept there after we had closed, I'm like, shit, bought the wrong house.
Speaker 2:After the
Speaker 7:first time, like, that's a very real thing that happens because Totally. In a typical real estate transaction, the deck is stacked against buyers and sellers. Like everyone involved has a conflict with the with the two principles. Mhmm. There's like a real agency problem.
Speaker 7:So if you're buying your first home, like the the thing that makes you most nervous is missing something. Right? So I think we launched at Opendoor is this buy a peace of mind guarantee where you can buy a house from Opendoor, move in, and if you don't like in the first seven days, just give the house back. We'll take it back.
Speaker 2:Wow.
Speaker 7:And the look, if I think it's one of those things where like, if you buy something on Amazon and you don't like it, you return it. But for some reason, if you're buying something that's hundreds of thousands of dollars, you can get duped and there's no one to return it to.
Speaker 1:I remember I I think I was I I must have been like some somewhat of a younger teenager when I when I figured out, okay. You make the most important purchase, biggest purchase of your life buying a first home, and you don't really get, like, a like, you don't even get to, like, try it out for a couple nights and because I it's just one of those things. As soon as you actually own something and you occupy it, you start you start know you I know that, you know, I bought a house last year and I the things I know I I I missed so many thing. Like, you know, I ended up getting like lucky. Right?
Speaker 1:It wasn't like I wanna return the house. But there are so many just small things that I noticed immediately from moving in that I completely missed. And I was like, wow. Thank God. I didn't that that is not that big of a deal or it's like a nice to have, whatever.
Speaker 7:Dude, there there there is a word for people who try to make money off you and then dodge town. We call them carnies.
Speaker 2:Carnies. Like like
Speaker 7:and we have turned like the entire real estate industry essentially into people whose job it is to like kind of hope you don't notice problems. It's very weird. Like, we stand by every single home on opendoor.com.
Speaker 2:Yeah.
Speaker 7:You buy it from us, you don't like it, that's fine.
Speaker 2:Yeah.
Speaker 7:First seven days, we'll take it back.
Speaker 2:Yep.
Speaker 7:And I thought this was this was a good I didn't think By the way, you know what happened? From a second we thought we should do this to time it was live was about seven days
Speaker 1:Mhmm.
Speaker 7:Genuinely. And the reason that was true is because there's a bunch of people in the path of doing this whose job it is at any big company to go, but actually
Speaker 2:Sure.
Speaker 7:Experts say this.
Speaker 2:There's risk or something.
Speaker 7:Don't think. Like, as a buyer, are you more likely to buy a home from opendoor.com if I tell you if you don't like it, you can return it? Yes or no? Yes? Of course.
Speaker 7:Great. Let's go. Yeah. Do we stand by our homes?
Speaker 2:So so it's a little bit of an actuarial puzzle that you have to figure out, okay, what is the cost for that and then distribute that over the over the buyers of that product. Mhmm. That seems like something a technologist, a product manager, somebody who's a little bit more forward thinking is completely set up for. That makes a ton of sense. What what else is changing in the market?
Speaker 2:I I'd love to get your thoughts on the fifty year mortgage that was proposed. Is that good for America? Is that good for Opendoor? Is that something we should be supporting?
Speaker 1:People have been comping it to what happened with Japan's market after they introduced fifty year
Speaker 2:Yeah. I I did see some people say, oh, it might be bad, but what what break it down for me.
Speaker 7:Look. I I let me, do the thing that I'm not supposed to do and answer the question honestly. I I I I think that people who compare this to Japan are just deeply misunderstanding a bunch of things about the American economy. Like, let's just be clear. Like, the American and Western economies are just fundamentally different because culture is fundamentally different and the economy is downstream from culture.
Speaker 7:Like, it's a very real thing. That that that matters. But secondarily, like, let's go back. Democracy in America, Tocqueville, in it, talks about how the main difference between America and every other country is that Americans own the ground they stand on. It has been historically true that Americans have had a higher ownership of the land that they live on than any other nation.
Speaker 7:Mhmm. And this has been basically the main difference between the American, I own this land, I'm part of this community, and the transient European and Eastern lifestyles. Right? Mhmm. If you divide the worlds into people who are from somewhere and people who are from anywhere, America is full of people who are from somewhere.
Speaker 7:This makes a difference. This makes a real difference to how people are raised, how kids are raised, the economy, the come the country overall. Now, why is a fifty year mortgage incredibly important? You would not have needed a fifty year mortgage twenty years ago. You just wouldn't have needed.
Speaker 7:In fact, when the thirty year mortgage came in in 1931, wanna say, everyone literally said all the things they're saying about the fifty year mortgage. This won't work. It's too long. How can people pay it off? But the thing fifty year mortgage does is this.
Speaker 7:The thirty year mortgage was designed for a time when people didn't have student debt, where the average life expectancy was about fifteen years shorter. The average work time was about fifteen years shorter. Like, there's a very real thing where people are buying homes later and later. We just crossed the average homeowner buying their first home at 40 because student debt is crushing American debt to income ratios. What the fifty year mortgage allows you to do is to get into the market, which is the best market Americans have historically gone to.
Speaker 7:It's the main source of leverage Americans get access to without being a big company and being a fancy person. Right? Mhmm. You get access to that leverage. You can do it while paying down your student debt.
Speaker 7:And once you pay on your student debt, there's nothing that says you can't refi and pay it down faster. But if fifty year does fix what's called a debt to debt to income ratio for folks while they're getting started.
Speaker 2:Mhmm.
Speaker 7:And like, I think it is incomplete. There's another thing that's important like, the people who are against the fifty year mortgage are coming out. You don't no one's forcing you to take a fifty year mortgage.
Speaker 1:You can still take
Speaker 7:the thirty or the fifteen. Yeah. But what you're saying is I wouldn't need it, therefore, no one can have it. Well, guess what, buddy? Not everyone lives in Palo Alto.
Speaker 1:Yeah. It's interesting. You know, the the one one thing that came to mind for me was, you know, what you've seen in the automotive industry where typically sixty month is maybe like the I imagine that's the most popular. Right? Yeah.
Speaker 1:And then there's seventy two month. And if you look on sites like DuPont Registry, John, you'll appreciate this. They have like a two hundred month, you know Oh, yeah. Yeah. Yeah.
Speaker 1:Auto loan for for For supercars. And it's interesting that, you know, that those have been getting pushed out. But the issue with cars is that their assets that historic almost always depreciate massively. And even on faster and faster
Speaker 7:times zero.
Speaker 1:Yeah. And even if you look at EVs now, they they depreciate at at, you know, levels that you haven't seen with Yeah. Ice, you know, cars. So yeah. It's a I guess I guess that, you know, I think part of the part of maybe the frustration and the reaction was, you know, this is a way to increase demand, but it doesn't fix the supply side.
Speaker 1:And so Yeah. Maybe it's focused on kind of the wrong
Speaker 7:We should fix the supply side too. Look. I think we should take we should understand what the government's saying. And they literally said this. They said this is one of the things we're doing, not the last thing we're doing.
Speaker 7:And by the way, in the last four weeks, they've also done a bunch of other things. Mhmm. They just changed the requirement on credit ratings. They just changed the requirement. They just announced that they're gonna have new FICO score in there.
Speaker 7:They've look. Do I think they should do things to make supply more readily available? Yes. I think they've talked about making one time assumable mortgages more available that will also change the supply, obviously. Mhmm.
Speaker 7:I think we should basically force cities to just stop being so anti builder. Mhmm. Like, the builders are desperate to build, let them build. I think there's a bunch of things we should do. Like, this is not this is a problem that was created over a decade.
Speaker 7:We're not gonna solve it overnight. But one of the things we must do is fix this massive problems where American governments at the federal and state levels started subsidizing student debt to levels where everyone graduates with such a large debt, they could not buy a house if they wanted to even if they had a down payment. Yeah. Right? So, like, we must do something to solve that problem.
Speaker 7:Otherwise, what's gonna happen is people are never gonna buy a home, and very soon, America's gonna start looking like Portugal. Mhmm. And that's not what we want. Like, this is this is a like, we know how good homeownership is.
Speaker 2:Yeah. What are your thoughts on stock based comp? There was that Keith Ruboy was getting in the fight with somebody years ago about stock based comp. It feels like for some of these companies that are more mature, maybe you don't need to lean on it as much, but also there's certain accounting rules that make it maybe more advantageous to use it. Obviously, you know, from the start up world, it makes sense to incentivize your employees with stock based comp.
Speaker 2:But how are you thinking about it? Is there anything that that is changing?
Speaker 7:Look. My my salary is a dollar. Right? Okay. Like, I get paid $1.
Speaker 7:Yeah. My entire comp is stock based based on performance measures.
Speaker 1:You you hit John. We're hitting the size gong for one of the highest salaries we've
Speaker 2:infinitely more than $0 salary.
Speaker 1:That's right.
Speaker 7:Yeah. So I'm not I'm not I'm ideological on this issue, which I think for a very long time
Speaker 2:Mhmm.
Speaker 7:Corporate executives have gotten rich driving their companies down in valuation
Speaker 1:Mhmm.
Speaker 7:And essentially failing their way to becoming millionaires. Right? This is like a very weird world where we've created where you are incentivized to suck at your job
Speaker 2:Yeah.
Speaker 7:And do nothing unless you get noticed. If you don't get noticed, you're not gonna get fired. If you don't get fired, your RSUs vest and you become like rich. Like, this is like the story of like so many great companies. This is terrible.
Speaker 7:This is just terrible for capitalism because as the American people rightly recognize, this is a scam. Mhmm. A world in which corporate execs get rich, shareholders lose money. That's terrible. I think corporate executives basically should only get paid in options.
Speaker 7:Now, like, it's actually it's actually difficult to only get paid in options. I tried.
Speaker 2:Sure. Sure.
Speaker 7:But there's a very there's a way we've essentially, at OpenDoor, reconstructed options as RSUs. The PSUs, if the stock goes below what it was the day I joined, I'm I get paid actually zero.
Speaker 2:Wow.
Speaker 7:Like, actually zero nothing. And there's, like, cliffs So they take
Speaker 2:away your dollar, or or you get to keep it with a $1?
Speaker 7:Well, should know what the
Speaker 1:funny thing is? They they they should be able to claw back the dollar. They should claw back the dollar. Have to
Speaker 7:pay for benefits.
Speaker 2:Oh, sure. Actually. So
Speaker 7:so I pay Opendoor to work at Opendoor.
Speaker 2:Sure. Sure. Sure.
Speaker 7:Yeah. Which I think is perfectly fine, by the way.
Speaker 2:Wait. I mean, so so so this is sort of, like like, do do you feel like you're in the in the lineage of Elon Musk's newest newest pay package, like, heavily, comp aligned to market cap. Is that Yeah. Where this is all going?
Speaker 7:Yeah. I mean, I I I'm missing a couple of zeros.
Speaker 2:Okay. Yeah. Of course. But, but I I yeah. I I I can't find a problem with that package.
Speaker 2:I I love it. I I just think it's so it's so aligned.
Speaker 7:I think it's a very real I think very few traditional executives would take it. Mhmm. Like, very few traditional executives would take it. But I think what shareholders should want is none of those executives to be in charge of publicly traded companies.
Speaker 2:Sure. Sure.
Speaker 4:Sure. This is like
Speaker 7:like this is a very real thing. I think in the private world, a very good indicator that a startup is gonna fail is if the founder pays himself a very large salary.
Speaker 2:Sure.
Speaker 7:Like, mean, I I I do some angel investing
Speaker 2:Yeah.
Speaker 7:That my wife insists we list under charitable giving on our family's investing. Yeah. But in my experience, if the founders pay themselves a very large salary, the company's gonna go to zero relatively quickly.
Speaker 2:Yeah.
Speaker 7:Somehow corporate executives get paid like in cash, like $510,000,000 and RSUs another $510,000,000 to basically be as inoffensive as possible and listen to the consultants. Like, this is what happens. Right? Like, you have some
Speaker 1:Listening to the experts again.
Speaker 2:Trust me.
Speaker 7:Yeah. This is like a real man. Like, you pay a comp consultant Yeah. To come give you advice on compensation. Mhmm.
Speaker 7:Then you go to a management consultant to give you advice on management.
Speaker 1:Yeah. Then you go to
Speaker 7:a financial consultant to give you advice on finances. Then you go to a PR consultant. And before you know it, this is what happened. Like, I I came to Opendoor and I went through every bill the company had paid for the previous six months. Like, actually every bill line by line.
Speaker 7:I'm like, what was this for? What was the outcome? And the company, paid them millions of dollars. Million like, it was actually I think number three on the expense line item. Like, we paid more for consultancy, we paid for Snowflake, which is like
Speaker 2:That's it's nothing. Yeah. Wow.
Speaker 7:And like, for to what end, the company was basically going to zero.
Speaker 2:Yeah.
Speaker 7:And but you but corporate exec but the fancy types who got MBAs from fancy schools do that to avoid being noticed and getting fired. Right? That's the goal. And I think I think corporate executives should get paid only when they make shareholders money.
Speaker 2:Yep. I like that a lot. This was fantastic. The chat is absolutely loving this. I wish we could go longer.
Speaker 2:We'll have to have you back. You're welcome anytime there's news or anything. Georgia, do have one last question for you?
Speaker 1:Yeah. I have a lot more questions. Have a more it questions. Let's a regular thing.
Speaker 2:Someone in the restream waiting room. Thank you so much for taking the time. I'd love to go deeper. Also, I mean, I just feel like we can talk about, like, anything, really. Like, there's so much here.
Speaker 2:Yeah. We barely when I asked about strategy, we, you know, spent five minutes on one particular product, and we could do that probably every single week since you're shipping so Yeah.
Speaker 1:I would say as there's more news on on mortgage you know, mortgages, both the assumable side, the term Yeah. You should come back on.
Speaker 2:We'd love to have you back.
Speaker 7:I think it's thirty seconds to do something. I promise it'll be only thirty seconds.
Speaker 2:Please. Please.
Speaker 7:Or stuff. If you are watching this show and you're a founder type, the odds are you're an odd duck. You're swimming in the wrong sea. Find me on x. My DMs are open.
Speaker 7:We're hiring in offices. This is not a remote company. We're in offices with our colleagues working incredibly hard for a future that matters. So find me, and we'd love to have more folks join the mission.
Speaker 2:Yeah. We love that. Everyone's clapping here.
Speaker 1:I love I love your perspective and and how you're approaching this, and, I can't wait to see all the progress you and the team make.
Speaker 2:Yeah. Highly recognize it. It's a generating opportunity. Cheers. Cheers.
Speaker 2:Bye. Let me tell you about Adio, customer relationship magic. Adio is the AI native serum that builds, scales, and grows your company to the next level. Our next guest is already in the Restream waiting room. We got Paul Needham from the infatuation.
Speaker 2:Welcome to the show. Look at that
Speaker 1:background. That is Look at the setup.
Speaker 2:I love it.
Speaker 8:Thank
Speaker 2:What's you, fun brand exploration.
Speaker 1:Very cool. What have Great to have you on the show, Paul. Yeah. I Chris, your cofounder, is a good buddy. And, and, yeah, it's great to have you here.
Speaker 8:Thank you. Yeah. Chris and Andrew started Infatuation now sixteen years ago.
Speaker 2:Mhmm.
Speaker 8:So we just celebrated our sweet 16 Sweet success. At the Selka in New York. Yeah. Exactly. Longevity is a good thing.
Speaker 8:It's And we're really proud to be carrying the tradition on and to continue to shine a light on all the great restaurants all over the country. That's what we're out doing this week is talking about our best new restaurants campaign.
Speaker 1:Let's talk about it. Break it down.
Speaker 8:Alright. So our team all over the country and in London, we went to over 5,000 restaurants this year. Mhmm. Spots, bagel places, pizza places all the way, especially out in LA. You guys have a lot of fine dining, a lot of omakaze.
Speaker 8:And we checked it all out and we crowned some of our favorites. So out in LA, places like Baby Bistro, River, Mustard's Bagels, Beethoven Market, and a bunch more. And then all over the country, looking not just at the best restaurants. I really liked Juul's in San Francisco this year for pizza. Smithereens is our number one in New York.
Speaker 8:But also looking at the trends. And what are we seeing out there? What are the threads? So obviously, marketing is continuing to
Speaker 1:How many people do you need to to properly evaluate 5,000 restaurants? Like, what does a team look like to pull that off? I'm assuming it's some internal, some external.
Speaker 8:Some of it's internal, some of it's freelance. The fun of it is bringing your friends because, you know, you can't go to a restaurant as one person and try everything. So we do a and a lot of restaurant critics, The Times and other places do it also. But we bring some folks around, we dine anonymously, we book under fake names, we pay for all the meals ourselves, Call it as we see it. And, yeah, it's a big effort from a lot of people.
Speaker 8:It's also we go back. And so we wanna give places that chance, especially when we're talking about a best new restaurant category. Wanna give people the chance to really show their best. And, yeah, we have a team around 50 people who who work on this for us. And then, yes, some freelancers and other folks as well.
Speaker 1:That makes sense. What is going on? Give us an update on the restaurant industry broadly. That was, you know, I obviously, restaurants tend to reflect, end up reflecting the state of the culture and the economy. And there was some reporting last week that we touched on briefly that, like, McDonald's is seeing a drop in in in purchasing from some lower income folks.
Speaker 1:That was surprising. I think people were pretty bearish about that. Maybe there's a different story there. But talk about kind of the health of the of of Yeah. Restaurants broadly.
Speaker 1:I'm assuming it's like a it's a pretty wide disparity.
Speaker 8:Yeah. And it's a complicated situation because you've obviously got Chipotle and others who've been out talking recently. But then, you know, The Wall Street Journal, I thought, had a good piece a week or so ago about how in New York, the kind of rich are keeping the party going. I think definitely when you talk to restaurateurs, look, folks in LA have had a tough year. No question.
Speaker 8:I'm sure you guys hear that a lot. Hopefully, starting to come back and
Speaker 1:And is that driven by the is that is that downstream from, like, the film industry not doing well? So just people in the creative world film are are just entertainment are just eating out less? Mhmm.
Speaker 8:You need expense accounts, you know, especially if you got a lease in Beverly Hills or you got a lease in West Hollywood, like, need people to be able to, put a corporate card down and and, spend a little more freely. But look, I think it's interesting also, you look at some of those trends and then you also look at things like $10 pastries and really elaborate matcha drinks and these small indulgences that people are definitely still treating themselves to. I mean, the cinnamon roll situation in New York had a outrageous year.
Speaker 1:Think you Wait. Is that
Speaker 9:is that
Speaker 1:the name of the restaurant?
Speaker 8:No. It's just you got one
Speaker 1:I thought I thought a restaurant called the cinnamon roll situation. It's like like we got a situation down here.
Speaker 8:It's a situation that we're monitoring. We're But we, I was on Yeah. Squawk Box this morning and the Today show earlier, and we brought pastries to all that. And it was like one cinnamon roll just got crazier than the next.
Speaker 2:And That's hilarious.
Speaker 8:So definitely, like, I think the restaurant industry situation is a big complex narrative across QSR, across fine dining, etcetera. I think the customer indulging themselves, treating themselves as another situation. And then look, there's no question that people drinking less is a huge factor for restaurateurs. And the folks who we're all, you know, friends within the industry, like, definitely, if you're not selling wine and you're not selling cocktails, that's a major headwind.
Speaker 1:Your profit margin.
Speaker 8:Yeah. Interesting. But look, you see the you see the $20 mocktail on a lot of menus now. Yeah. And definitely folks are trying to make the non alk stuff happen, and trying to make some money off non alk.
Speaker 8:But
Speaker 1:what you're seeing much. Yeah. So from what you're hearing or seeing, like, is it is it some people have gone from drinking to no drinking, and then a lot of other other people have gone from a like heavy drinking to just moderate drinking, and so they're seeing, like, both both types of of of, of guests just kind of like
Speaker 2:I recently went from no drinking to heavy drinking. It's been great.
Speaker 8:You guys are keeping the you guys are keeping the industry afloat. Look, I think there's a lot of people obviously, wellness is a huge, like, factor in so much stuff. We also see that in the hour people the hour people are eating. So, like, all of a sudden, 05:30 is a really hot time to go to a restaurant where, you know, a few years ago you were like embarrassed to ask someone to go to dinner at 05:30. I think
Speaker 7:It's there's a lot of people
Speaker 1:so clearly the problem. I just I I like to go to dinner at 05:30, sometimes five. I like to I I don't like to be digesting food when I'm going to bed.
Speaker 2:Really like that.
Speaker 1:And I don't I really I have, like, one one drink a month.
Speaker 2:Our audience is a lot of tech people. Do you have a recommendation for a restaurant that might be particularly good for planning a coup? If you're planning a boardroom coup, or maybe celebrating a successful boardroom coup, do you have a recommendation for a restaurant?
Speaker 8:And this needs to be in, like, the South Bay?
Speaker 2:I mean, ideally, San Francisco, but boardroom coups are happening all over, maybe in New York as well.
Speaker 8:San Francisco, look, a lot of great places. I mentioned Juul's Pizza earlier. That's where I would plot my coo.
Speaker 2:Is it quiet? Right now. You're not gonna be over There's
Speaker 8:like some corners.
Speaker 1:You could Yeah.
Speaker 8:Could tuck into a corner. We could
Speaker 1:tuck into a corner.
Speaker 2:I like
Speaker 8:The mayor was there recently and was, like, blowing them up.
Speaker 2:And Okay.
Speaker 8:Okay. They're where the action is.
Speaker 2:Yeah. I feel like I feel like the the proper environment to plan a coup is sort of, like, leather leathers leather booths
Speaker 1:Ideally, some mahogany.
Speaker 2:Some mahogany, something like very where every little booth is, like, nestled off to at the side. No one can really see each other too much.
Speaker 8:Know in New York a New York little interesting development this year that did not get a lot of attention, but Fort Charles opened a private dining room. And so for as hard as it is to get a reservation at Fort Charles, the private dining room, if you got, like, $12 for a table of eight
Speaker 2:Okay.
Speaker 8:They will have you any night you want,
Speaker 2:and it has exact billions of dollars at stake. So, know, what's What's
Speaker 1:the guy who's spending 12
Speaker 2:k on a stake? That's no problem. Yeah. Always like Pacific Dining Car in LA. That feels like a good place to plan a coup.
Speaker 2:I like a mafia movie vibe.
Speaker 1:How how is is is is Instagram still having the like, so so I don't I don't identify as a foodie at all. I I enjoy food. I don't I don't spend a ton of time, like, think seeking it out. But it there's been a lot of conversation over the last probably decade now around how Instagram is just driving every city on Earth to look the same. So like no matter where you go in the world now, can get like a matcha and you can get like New York style pizza from somebody who was maybe in living in New York like two years ago, whatever.
Speaker 1:Is there anything like, is there any parts of The US that are kind of like fighting back against that and like really trying to create a more localized food culture? And is that even possible anymore?
Speaker 8:Yeah. I mean, think definitely everything you're saying, you see, like, the matcha thing get crazier and crazier month by month. I saw Lauren Sherman said over the weekend, like, matcha is like kale. Like, people are just doing things to matcha that shouldn't be done. I think you've got, you know, pizzas everywhere.
Speaker 8:No question. And really good pizzas everywhere. And to your point, like, Mexico City is everywhere now.
Speaker 2:Yeah.
Speaker 8:Where, like
Speaker 2:What is that?
Speaker 8:Every New York City like, every New York big opening this year is, like, Mexico City inspired in some way or another.
Speaker 7:Interesting.
Speaker 8:I would say, like, Nashville, I'd point to Texas. Like, I there's definitely pockets where you're seeing people really do something that's very unique. I think Miami has been an incredible food scene for us in the last few years. And definitely Miami even if it's not cuisine per se, like the personality of a Miami restaurant, Sunny's, which is one of our favorite steak houses down there, like, that restaurant could only be in Miami. And you definitely, like, feel that you're in Miami when you're there.
Speaker 8:But look, Beethoven Market, when you're sitting out on that terrace in Mar Vista, like, there's stroller parking. It very much feels like, oh, this is the West Side Of Los Angeles. And Wild Cherry, which just opened in the West Village Of New York, which is the a 24 restaurant. Like, it very much feels like, oh, we're in a kind of, like, New York canteen connected with a small theater. So there's definitely still places that are kinda creating that sense of unique personality.
Speaker 2:This is very cool. Thank you for coming on and giving us the update.
Speaker 1:Yeah. I got it. I've I've held up, by the way. I haven't had a matcha in at least a decade. I had tried it a long time ago, and and I haven't I haven't gone back.
Speaker 1:It's not for me. Yeah. It's not for me.
Speaker 8:We'll send you there's some good powder ones you can make at home Okay. That are really easy and pretty good to
Speaker 2:check out. Fantastic. Thank
Speaker 8:you, and congrats. Everyone's watching, man. Everyone's watching.
Speaker 2:Thank you for coming on so was lot of fun.
Speaker 1:Thank you for giving us an update
Speaker 2:on I'll get you back on
Speaker 1:state of the market, and, congrats on the on the launch.
Speaker 2:We'll see you. Have a good one.
Speaker 8:Yes, sir. Bye, guys.
Speaker 2:Let me tell you about public.cominvesting for those who take it seriously. They got multi asset investing, industry leading yields. They're trusted by millions. We are completely switching gears now from food and beverage to Jordan Nannos at, Semi Analysis taking us through the latest from ClusterMax. This is ClusterMax two point o.
Speaker 2:Correct?
Speaker 10:That's right. Yeah.
Speaker 2:What are the biggest findings? How do you introduce Cluster Max in the, you know, 140 characters version? I'd love to just get into the actual findings.
Speaker 10:Yeah. Well, it's it's great to be here with two of my technology brothers. Thanks.
Speaker 1:There we go.
Speaker 10:I can definitely yeah. I can definitely take you through cluster max. Basically, the way we see it, some of the most critical transactions in AI are happening when people are renting GPUs from a provider. Yeah. So this is companies like CoreWeave Yeah.
Speaker 10:Navias, Lambda, FluidStack, Crusoe. They've been coming to market and taking share from, you know, AWS, Azure
Speaker 2:Yeah.
Speaker 10:GCP, Oracle. And I think a lot of people basically, they think that all GPUs are deployed the same, and that's definitely not the case. So we go through in this article a lot of details about how our hands on experience and then feedback from customers kinda makes it clear that, it really depends which provider you go with when you're making a critical decision, like where to buy your GPUs.
Speaker 2:Yeah. How do you, how do you actually feel like you're getting accurate data? Because if if a semi analysis email shows up and I'm running a Neo Cloud, I'm like, yeah. Let's put them in the best data center we have, I imagine. So is are you it it feels like blind taste testing.
Speaker 2:We were just talking to a restaurant reviewer. I feel like you're a data center reviewer. There's these segments are actually pretty similar.
Speaker 1:Fake fake companies. Even get them into YC and just sign up.
Speaker 2:Yeah. Something's going. But, yeah. Talk about the pitfalls of the process or, like, how you actually tease out what's actually going on.
Speaker 10:Yeah. I don't know if we're really doing a secret shopper thing quite the same. Like, we definitely got CTO on the phone in some cases to walk us through the greatest. But in my research, I talked to a 140 different customers of these Neo Clouds to get their perspective on exactly what their experience was with reliability and support at scale. And I think it was quite revealing because, like I said, yeah, sometimes you get a really good experience in one data center that's quite different from somebody who's running stuff in Iceland or something like that.
Speaker 2:So what changed this, with this version? I know that the actual graphic has exploded. There's more there's gonna be
Speaker 1:more Do we need more do we need more neo clouds, by the way, or are there enough? Do there's you do we have do we have enough?
Speaker 2:But, yeah, what else was what else did you find?
Speaker 10:Hey. We need more, man. We need more of it all.
Speaker 2:Let's hear it go. For more. More. Yeah. You for the tireless work indexing the entire market.
Speaker 2:Yes. But what what were the findings?
Speaker 10:Yeah. Look. I think we probably don't need a lot more Silicon Valley backed venture startups that are all renting GPUs from another provider and selling them with a bit of software on top of them. But we're seeing a lot of the, like, sovereign AI projects just get started, and it looks a lot like a telecom build out where, you know, different regions or countries have their own regulations or, you know, their own sovereign wealth funds that are funding the build out of a bunch of GPUs. Yeah.
Speaker 10:And I think that's just getting getting started. So you're right. The biggest difference is we covered 84 Neo Clouds this time as opposed to 26 last time.
Speaker 2:Mhmm.
Speaker 10:Our total market view, there's now 213. Learned about four of them since we published last week.
Speaker 2:I feel like, hey
Speaker 1:I mean, if you're a Neo Cloud and you're not on the list, it's probably fair for the investors to send you that and be like, hey Hey. What happened?
Speaker 10:I mean, we're doing our best to get coverage, but they they pop up all the time with different people who are in different phases of actually launching.
Speaker 2:Yeah. But, yeah, what, what are the biggest movers? What were the biggest surprises? What were the biggest changes? Because it seemed like CoreWeave has done well last time, this time, but there's probably some other folks who have taken taken your feedback and and actually made changes.
Speaker 10:Yeah. I think probably the two big ones are that FluidStack debuted at Gold. Like, we did not rate them last time, and they're they're kind of coming out of nowhere with a really interesting offering for taking other, let's say, bronze or worst tier GPUs and making them usable for frontier labs. Like, they have some really, really big customers.
Speaker 1:Mhmm.
Speaker 10:I think Google improved a lot. If the market had really shifted to using strictly Blackwell GPUs and wasn't still stuck on using some of their old hopper GPUs with their older networking, I would see would have seen Google, you know, possibly push to gold. I think they will in the future. They've they've been really improving. We've got a lot more work to do with AWS.
Speaker 10:Think they they they're really focused on EFA and the rest of the experience is coming along, but their networking is just look. It represents, like, less than 1% of the cluster TCO by our calculations. And the users tell us it's, more than half of their debugging time is trying to figure out AWS's custom networking on some of these clusters. So Woah. We'll see who takes the feedback and who doesn't going forward.
Speaker 2:That's try to be insane finding.
Speaker 10:Like, include a lot of stuff from those customers in there as opposed to just, you know, a micro benchmark that we run on the network ourselves.
Speaker 2:Yeah. That's super interesting, Jordan.
Speaker 1:Wanted to get your read on depreciation schedules. I feel like there's a big debate and something that's gonna be critical to the health of a lot of these players. And as chips get better, you would hope that that the depreciation schedules, you know, would expand somewhat. But we're seeing it all all over the board in terms of how different companies from hyperscalers to some of these new entrants are actually planning around depreciation. And I, would love to kind of hear how you how you think about it broadly.
Speaker 10:Okay. I think broadly speaking, depreciation is a financial metric that's hard for us to measure and varies between the different providers quite substantially where people take different approaches from three to six or longer years. In terms of the lifespan of the actual technology, like, there's there's two ways to think about this. One is how long does the thing keep running well before it starts to have a lot of wear out failures, like the GPU and the system. And then the other one is how long is it useful on a performance per dollar basis.
Speaker 10:And I think that second one really depends on how good future GPUs are. So right now, we are seeing providers who are limited on power. They literally have no more floor space in their data center, rip out perfectly good GPUs that are making them plenty of money to replace them with the latest and greatest because they can make even more money.
Speaker 2:Wow. And
Speaker 10:so if that power constraint goes away or the newest, latest, and greatest GPUs don't give you that massive performance increase, then I think people will sweat the assets for longer functionally in the data center. But I think a lot of people on the financial side are playing a guessing game or they're designing it based on how they wanna design the financials of their business and not necessarily taking into account exactly how the GPUs perform or what's coming down the pipe.
Speaker 1:Is that is that bad?
Speaker 10:I don't know if it's bad. I think it's just pragmatic. Like, if you look at a hyperscaler and you see that they have all of these build outs of new data centers coming online and they want to look. They want to address the needs of that customer base and things just aren't coming fast enough. Mhmm.
Speaker 10:Ripping out old GPUs and putting in new ones seems like it's a good play. It seems like it's good for the people who want the best performance. It seems like them, you know, they're gonna get more revenue per megawatt with the latest and greatest. Yeah. I don't think it's necessarily good or bad for What
Speaker 1:about what about so Satya has talked a lot about wanting a a diverse GPU fleet, fungibility of of the fleet, not wanting to just do exactly what, like, a key customer like OpenAI wants. If OpenAI says, hey. Build this data center for this specific training run. He's not immediately saying, like, yeah, of course, I'll do it. No no questions asked.
Speaker 1:He's sort of, like, you know, being pragmatic about it. How much do you worry with some of these other neo clouds about being, like, too indexed to a specific type of, like, workload or tech stack given how fast the, you know, space is evolving and ending up in a situation where they just have a bunch of dead weight?
Speaker 10:Yeah. That's a really good question. And I think you're segueing into an article that we got coming out later this week and a fun interview that that some of the guys did. So let me try and not talk about that while still teasing it. Basically yeah.
Speaker 10:I think the the the concept of fungibility is really important to the hyperscalers. And it seems like in some ways, they are exploiting the neo clouds, for better or worse, who have, you know, four sites. And they're gonna take a whole site and have it all one chip, and that's gonna be a bet for three to five years. And we'll see what happens after that. So in some ways, investors kind of view this as returning the AI market beta versus getting some alpha on an individual chip or on an individual workload.
Speaker 10:And I think it's look. The there's a lot of upside in this. And to your point, that focus on fungibility or prag pragmatism may have led to Microsoft Alert losing, like, $320,000,000,000 of RPO to Oracle announced a couple of months ago
Speaker 2:Yeah.
Speaker 10:At reasonable margins. So, you know, I I think time will tell on that decision. At Summit, I'll just generally speaking, you're gonna come to us and get a pretty bullish take. We are way ahead of the market on that Oracle print last quarter.
Speaker 1:And Let's give it up for bullish takes.
Speaker 10:Patch it big enough.
Speaker 2:Yeah. No. That makes sense. How does, with with fleet fungibility when you see, you know, on ClusterMax, there is Azure, and then there's also a bunch of that have partnerships with Microsoft like Nebius. Yeah.
Speaker 2:How does that actually work if you're a lab and you go to Azure and you say, I want GPUs from Azure and then Satya says, oh, I have some here for Nebius. And then dealing with, like, you know, the intrinsic details of this Part
Speaker 10:of of me workloads.
Speaker 1:Yeah. Part of me though part of me though is, like, like, who do you think is gonna be able to make the better call? Microsoft and Satya or Oracle when it comes to capitalizing on all that demand from OpenAI. Right? Who has more information?
Speaker 1:Who has more experience, you know, working with OpenAI? Who has, you know, handling these, you know, training runs? It's like I don't wanna I don't yeah. Again, time will tell. Right?
Speaker 1:It could have been like the most brilliant move ever from Oracle. But at the same time, I have to imagine Oracle is like, basically we we had a graph last week on on kind of understanding where the where the AI players sit on this idea of, like, how much they need, like, AGI versus don't need AGI and how much they believe in AGI and how much they don't. And we were putting, Larry, like, way up in the left corner of, like, needs AGI but doesn't necessarily Believe or
Speaker 2:or hasn't hasn't issued public statements about
Speaker 1:Hasn't issued public statements at least. But, I just feel like very much like a a hail Mary from hail Mary from Oracle. And if they if if the depreciation schedules are quite a bit different than what they're planning, they will OpenAI will have gotten the much better end of that deal. And I think Satya could end up looking pretty smart for not going after it. But who knows?
Speaker 1:Yeah.
Speaker 10:I I mean, I tend to agree. I don't think Satya's looked dumb very many times in his career. I think he gives very thoughtful answers when it comes to this stuff. I do think, in some respect, it's a matter of timing. Like, if you look at what Microsoft's build out looks like right now, they are accelerating, and that's on the back of OpenAI, but also some of their SaaS products that are using this technology.
Speaker 10:They have access to all of OpenAI's IP through 2032. So they're certainly exposed to any upside on on that side. And, yeah, it's it's a matter of when you wanna take your free cash flow down to zero to do a build out. And Oracle seems to be the first one to have moved while Microsoft flinched a little bit. And then
Speaker 1:It's a game of chicken. It's a game of chicken. Hyperscale chicken. What what did you think about feel free to give your your personal views. You don't have to share the official official point of view of semi analysis unless you want to.
Speaker 1:But backstop gate last week, I think, you guys had probably been privy to conversations or heard, you know, it's not the not the first time that that the idea has been floated around. I mean, we're seeing sovereign AI in other countries. I'm assuming we'll see some version of it here. But, what's your what do you rate the likelihood that we could see a scenario where the the government would effectively be guaranteeing loans for, AI, you know, data center build outs?
Speaker 10:Yeah. I don't know how much, I have an opinion on that. It it when I read into it, it seemed like they weren't actually asking for a backstop or a bailout. The
Speaker 1:Yeah. And I I agree I agree with you there. I'm not I I well, my our our understanding of it was it wasn't asking for a backstop on OpenAI or or any type of bailout. It was just like the language implied that they would be open to a world where data centers would be treated like some other categories and that around national security, like manufacturing, where the government would basically wanna encourage the development of of data centers by saying, like, we're gonna guarantee these loans, which would just encourage lenders to have more confidence to lend against assets that might depreciate faster than people think and and present some risk.
Speaker 10:Yeah. And I I 100% agree in terms of guarantees. We see this elsewhere in the world quite substantially where there's governments in The Middle East, Norway, Canada to a small extent, Indonesia, Korea, Japan, India, they're all, like, getting in on building a Neo Cloud. And, the US government has not gone out and built a Neo Cloud, but they certainly build supercomputers for defense, intelligence, research. And they certainly have a vibrant community of companies.
Speaker 10:So I think there's more that the government can do to accelerate the time in which you can build a data center behind the meter, which a lot of places are trying to do right now without interconnect. Semi analysis, we've got a energy model coming soon that's sort of a companion to our data center model. It's really exciting. Got guys on the team working on that who were grid operators in their previous job. And they've got a lot to say about the lead times to get turbines right now or how much red tape there is to get nuclear, wind, solar online, how you need guarantees from the utility even if you're behind the meter, as some sort of, you know, future interconnect agreement or some sort of stabilizing power load or I mean, there's there's just so many creative things that could be done with the grid in The US that I think are kind of fundamental before you can have discussions about financing a lot of stuff because, look, when we get in conversations with investors, I think there's a whole bunch of capital to be unlocked in the private equity space that is just getting started.
Speaker 10:And it feels like early innings because VCs are the first ones to move, and they have in the neo cloud space.
Speaker 2:Mhmm.
Speaker 10:But we haven't seen a lot of, like, institutional players decide to make a make a bet on this the way they have with energy, with housing, with commodities. And if GPUs are gonna be fundamental and they're gonna be a commodity and people wanna bring, like, an h 100 index to the market, you're gonna see a lot of, like, institutional capital try and pour its way in here. Yeah. And, like, functionally, how does that work? I think it actually comes in terms of, like, accelerating the existing data center projects as opposed to having The US just start to build something new.
Speaker 2:Oh, sure.
Speaker 10:So to that extent, like, totally agree with everything. I think the market kind of shuddered at those comments because it seemed like they were asking OpenAI is asking US government to pick a winner when that is clearly not the case. Like, there are winners and losers being shaked shaken out in, like, chat, research, coding. Yeah. But we're in the early innings of video and image generation, of material science, of drug discovery, of weather prediction, all of these models that are showing incredible early results from transformer based architectures running on the same GPUs as the chat models that could be the, you know, lion's share of compute in the future if suddenly everybody wants real time generated video on their feed or or making small weather predictions for everybody who's getting ready to go skiing or something.
Speaker 1:Like Yeah. Fascinating. I would like to see more AI on the slopes.
Speaker 2:On the slopes.
Speaker 1:I like the sound.
Speaker 2:Like the to Vail.
Speaker 1:Semi analysis can do a ski trip, invite all the different, players in, bringing AI to, the mountains. That's fascinating. Please invite us.
Speaker 2:Yeah. Very excited for the energy model. Please. Call it powder max. Whoever's working on that, as soon as you launch energy max, we wanna talk to you guys.
Speaker 2:We always enjoy talking to everyone at Semi Analysis. Such thorough research, such, deep insights. We really appreciate
Speaker 1:it. You take time. Yes. Chads. Great to see you, Jordan.
Speaker 1:Thanks for coming on. We'll talk to soon.
Speaker 10:See you guys too. Yeah. You're welcome to Whistler anytime.
Speaker 2:Amazing. Amazing. Let me tell you about adquick.com. Out of home advertising, easy and measurable say goodbye to the headaches of out of home advertising. Only ad quick combines technology, out of home expertise, and data to enable efficient, seamless ad buying across the globe.
Speaker 2:Our next guest is Isaiah Taylor from Valar Atomics. Congratulations, Isaiah. Woah. How are you doing?
Speaker 1:Look at
Speaker 2:this backdrop. You look fantastic. Congratulations. Second time on the show. Give us give us the story.
Speaker 2:What happened today?
Speaker 4:Yeah. First of all, the Eagle Screech was fantastic timing there because we have our beautiful nuclear test site out in the back here, in the middle of Utah Desert. Fantastic job producers. Yeah. We That was me.
Speaker 4:That was me.
Speaker 8:That's Jordy soundboard. Jordy.
Speaker 4:When they saw my background. Yeah. And then you could hit play.
Speaker 2:For sure.
Speaker 1:We got so many sounds. We got here. I got I got sounds for Dave.
Speaker 4:That's exactly what it sounds like when one of our nuclear reactors starts up. That's nice. No. It's we're having a great day. It's it's an amazing day for Valoratomics.
Speaker 4:We announced a $130,000,000 series a earlier today. Fantastic. Let's go.
Speaker 2:Nice. Congratulations.
Speaker 4:That is a proper gong.
Speaker 2:That's your series a. It's Wait. You I thought It's series a. I feel like you had
Speaker 1:raised a series a before. Wow. No. Is a seed riot? I didn't realize.
Speaker 4:That's right. We announced a a $19,000,000 seed round Okay. Earlier this year.
Speaker 1:Yeah.
Speaker 4:And and, actually, we built our reactor on a seed round, and we didn't turn it on. So now we have enough capital to go turn it on.
Speaker 2:Okay.
Speaker 4:And this is something I'm super proud of the team for, by the way, because I I think this is, how venture's supposed to work. You you hopefully turn something on
Speaker 2:Yep.
Speaker 4:In the in the series a. This is like when you find, you know, product market fit. So I'm super proud of the team. This is our goal. Go split the atom with this capital.
Speaker 2:Yeah. I mean, yeah, the the whole story here makes so much sense because, like, you started with, like, the really, really big vision. Like, turning, you know, nuclear power into energy that could be transported. Actual like, you were gonna synthesize hydrocarbons, and you laid out this big vision. But then that was almost like act three.
Speaker 2:And then act one was like, can we actually build something that doesn't even turn on but just shows that we can actually build something? Then let's go turn it on. Let's start generating energy. Then if we have abundance and tons of energy, then let's figure out what next to do. And I think people were always, like, a little bit thrown by how far you were thinking into the future, and they were like, well, let's see what this guy can do in six months.
Speaker 2:And then you delivered on the six month project, and now I think people are are waking up to what you're building. Is that how you've experienced it?
Speaker 4:I think that's that's an accurate perception, and I've certainly learned a little bit about how to pitch the story. We I I talk a little bit more about the short term now, but I think about the long term every single day. Totally. I mean this, I think of this as my life's work. Energy is a very interesting thing where there's obviously an enormous amount of demand already, right?
Speaker 4:There's trillions of dollars worth of energy demand. But it's one of those things where if you make a lot of it and you make it very cheap, it creates its own demand.
Speaker 2:Sure.
Speaker 4:And I don't think there's really a limit to that. Like, the more I play this out in my head, if you can make energy cheaper, you open up these new apertures of places where you can sell it and things that you can do with it. Mhmm. And so that that really is, like, the fundamental motivation and the thing that we're trying to do here is that I think energy should be 10 times cheaper than it is right now. And you're right.
Speaker 4:That's, like, a really long term vision. Yeah. But you have to be able to be super concrete and build stuff right now, six months, twelve months at a time.
Speaker 2:Yeah. So, I mean, the original vision, still very cool. I don't think it doesn't sound like you're losing sight of it. I don't think you should. But the I mean, we were just talking to semi analysis about the build out for AI data centers, and it feels like energy is the bottleneck.
Speaker 2:The question of we will probably be able to scale up the GPU production, but getting enough energy at the right price is probably gonna be the next thing that we're talking about all next year, the year after. And there's gonna be this question of, like, where's the energy coming from? It's gonna be a political issue if it's oil and gas. Maybe this should be oil and gas in the short term. But in the long term, I think most people agree, nuclear and solar.
Speaker 2:And so how are you thinking about the broader story here with America's renuclearization? There's a bunch of companies that are working on this. What are the timelines? What are the key things that need to happen? How's that looking?
Speaker 4:Yeah. I think AI needs power in the next couple years. That's pretty obvious. And, you know, I was at an event with Tyler Cowen and Sam Altman a couple weeks ago,
Speaker 2:and Yeah.
Speaker 4:Tyler asks him, you know, what's the only thing holding you back? And he says, electrons. Yeah. And Tyler says, anything else? Chips?
Speaker 4:You know, he's like, electrons. Right? So that's pretty clear. Then the follow-up question was, what's the nearest term way to solve that in in Sam's natural gas? And I would generally agree with that, and I think that's probably true for the next eighteen months.
Speaker 4:We do want to make power for data centers in 2028 though. And the interesting thing about nuclear is that I believe it scales very differently to natural gas. Natural gas is is very site specific. You need to go find good gas sources. You're you're working on routing.
Speaker 4:There's all these complicated things. Nuclear, you can kind of do wherever it makes sense, and you can put a lot of it in one place. The reason for this is uranium is just easy to move around, right? It's kind of a year's worth if it fits on a truck, unlike a natural gas pipeline where you're working on the actual in ground logistics of moving gas around. So I think once we've gotten that cracked, like the first unit that's making power, we could just make more of them.
Speaker 4:And you you end up seeing these big sites that that people are sort of dreaming about today where you have a one, two, three gigawatt, you know, AI data center. This is very easily deliverable with the nuclear reactor that you just mass produce. Right? Because you don't have to worry about these gas logistics.
Speaker 2:Yeah. But how do you decide, like, if we're doing one gigawatt, that means we I mean, the last thing we talked about was, like, maybe targeting 10 megawatts, so you need a 100 of these things. Like, why a 110 megawatts as opposed to a thousand one megawatts or 10 100 megawatts. Right? Like, there's some trade off.
Speaker 2:How'd you land there?
Speaker 4:Yeah. So our our unit will be a 25 megawatt electric
Speaker 2:25 megawatt.
Speaker 4:Approximately. Yeah. So that's about 40 reactors 40. Per gigawatt. And really the reason here is I I just think that in the West in the Western world, we're really good at making bus sized objects.
Speaker 4:And if
Speaker 1:you try
Speaker 4:to make an object bigger than a bus, you have a hard time. Yeah. We're we used to be good at this. Right? We used to be really good at, like, large scale, like, Hoover Dam, style construction, big nuclear reactors.
Speaker 4:Yeah. Spatial, all this kind of stuff. But if you notice how Elon sort of revolutionized rockets, he actually downsized pretty significantly.
Speaker 2:Yep.
Speaker 4:Right? The Falcon nine is a smaller rocket than, you know, any of the the heavy launch vehicles that took us to the moon. And then he kinda slowly worked his way back up to Starship. Mhmm. And even Starship is, like, taking longer than you would have expected.
Speaker 4:So there's just something about the tool sets that we have, the way that we do engineering that favors making objects smaller and making lots of them. Yeah. So if I'm There's
Speaker 1:a big part like how put
Speaker 2:it on a truck. I talked to some early SpaceX people about that, they're like, you can put the engine on a truck. Once you go any bigger, it's like, get out the crane every single time you wanna do anything. Exactly. And so if you can do just little less crane work, it just compounds and compounds and compounds.
Speaker 1:What are what are the what are the key risks to the business over the next, like, twenty four months that you talk about internally with the team, things that you're trying to prove out? I think somebody, you know, haters could have said, you know, a year or so ago, you can't build a nuclear reactor, with $20,000,000. You you you derisked.
Speaker 2:You'll need a 153.
Speaker 1:You derisked you derisked What
Speaker 4:do think about that?
Speaker 1:From a capital from a capital standpoint. Now, you're much less capital constrained. And you certainly doesn't feel like there's a lot of risk on the demand side, which is like if you can make cheap energy, will people want this? Think, we know the answer there. But what are you what are you kind of like focused on internally?
Speaker 4:Yeah. That's exactly right. And actually, I think people are massively over focusing on every risk except just the technical execution. You mentioned, like, there's a lot of demand. Right?
Speaker 4:I think you'll see a lot of companies put out MOUs. They'll they'll sign deals. Right? You'll see Mhmm. You know, this company sent a deal deal with Google.
Speaker 4:This one sent a deal with Amazon, this sort of thing. One of my actually biggest Twitter haters, I'm gonna have to shout out, unfortunately, because he wrote such a good tweet, and somebody sent it to me that I was
Speaker 2:like saw this. It is.
Speaker 4:It's like, damn it. I'm gonna have
Speaker 1:to I'm gonna have to
Speaker 4:shut that one out. And my one of my big Twitter haters, Nick Turan, shout out to you, Nick, said I'm issuing a universal MOU to all nuclear companies. Me, Nick, I'm saying I will buy $10,000,000,000 of energy from any nuclear company that can actually build a nuclear reactor on time and on budget and at a good price. Right? So I think this is actually totally right.
Speaker 4:Like, there is so much demand, and the thing that's missing is capability. The thing that's missing is actually turning reactors on. So the risk is entirely we have to go build this reactor and turn it on. And this is, I think, essentially what sets Valor apart from basically everybody else in nuclear today is that when we started the company, core conviction was that nuclear has to go back through R and D again. We sort of assumed as an industry that because we've built many nuclear reactors in the past that we still know how to.
Speaker 4:And I think that's fundamentally wrong. And this is sort of our belief from the beginning that we have to go back through R and D. R and D means starting small, starting low power, building it very quickly, testing it fast, and that will lead us to a commercial unit. But there is just real tech risk along that path. Right?
Speaker 4:You know, pumps don't work like you thought they would. Seals don't work like, you know, they don't hold as much pressure as you thought and and you iterate through it.
Speaker 2:Is the tech risk I mean, it sounds like the test the tech risk generally is a little bit overrated because this technology fundamentally, like, it did work eight years ago. It did work, you know, in the sixties. I mean, there were some problems in
Speaker 1:certain Yeah. But even going to the moon is somewhat of a lost art.
Speaker 2:Yeah. Yeah. I get it.
Speaker 4:Yeah. I I would put this into the bucket. It's not science risk, it's it's tech risk. Right? Tech is really about engineering and capital.
Speaker 4:It's it's about what are your timelines yeah. Economics, engineering, and capital. What are your timelines? How much money do you have and resources to do it in the right timelines? Yeah.
Speaker 4:And and that's why our focus has been small steps executed extremely quickly. Yeah. I started this company about two years ago. It's been about two years and two months since we started the company. We built our first nuclear reactor within fourteen months of founding the company, and we're gonna hopefully turn it on before the three year mark.
Speaker 4:And if you can move at that pace, I think you can sort of iterate your way. You you get more shots on goal. Right? Moving quickly means you get lots of shots on goal. So if the seal doesn't work right exactly the first time you do testing, that's fine because you have some time to go and test it and and iterate that seal and that valve.
Speaker 1:Yeah. Are you, moving the family out to Utah yet? Are we gonna see a Valor kind of, like, planned development with a bunch of
Speaker 2:Oh, that feels fair. I'd like to
Speaker 1:see a bunch of mid century homes I like that.
Speaker 4:Yeah. Set up. I will say we do have more RVs than I expected at the site right now and a lot more on on order as well. Yeah. The the housing out here in the desert is gonna be an interesting challenge to solve.
Speaker 4:We're not just building the reactor building here. We also have a trace of fuel plant that's going up as well. So we're actually gonna be making our own trace of fuel. So, we're gonna have a a really fun operation out here, and that's only the beginning.
Speaker 1:Very cool. Very cool. Congratulations on the progress in the round. Fantastic. I'm super excited for you and the whole team.
Speaker 4:Yeah. Amazing. Awesome group of investors too. I'm I'm I have to shout out Doug Filipone who led this round, ran global defensive talent here Yeah. For, I think, seventeen years.
Speaker 4:Started Snowpoint, ex Army Ranger, JSOC commander. Awesome, awesome guy. Not in this photo, but I actually arrived on our our site here for the groundbreaking in a Blackhawk helicopter No way. With Doug, which was which was fantastic. It's a great time.
Speaker 4:The suit the suit and the
Speaker 1:Blackhawk goes unbelievably hard.
Speaker 10:It goes
Speaker 4:quite hard. Fantastic. Hadram Sharath and Richard Blankenship as well from Dream, absolutely made the magic happen on this round too. Fantastic guys. Really, really grateful for for all our investors.
Speaker 2:And Palmer's in. I remember last time me, you, Palmer were together. You guys were in a fierce debate, and you clearly got you wound up seeing eye to eye because now he's in the round, which is, congratulations on that.
Speaker 4:Yeah. Yeah. I think we're debating about how much uranium we have. Yeah. There's lots of it guys.
Speaker 1:Oh, yeah.
Speaker 4:A lot of uranium to to use. Yeah. Yeah. I mean, someday someday we'll get the fusion, but not before we're all living in, like, O'Neil cylinders, with with more energy than we know what to do with.
Speaker 2:Fantastic. Well, I'm I'm very excited for our nuclear future. I'm excited for what you're building, and, I just wanna say massive congrats. I remember we we filmed a very brief interview, in El Segundo probably around two years ago. You didn't even have an office yet.
Speaker 2:And Yeah. It's been what a what a fantastic run. Congratulations on all the progress.
Speaker 4:Amazing stuff. Thanks, John Jordy.
Speaker 2:We'll talk to soon.
Speaker 1:See you.
Speaker 2:Let me tell you about 8sleep.com. Get a pod five open.
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Speaker 1:I am unfortunately What happened? Away from I was away from home. Oh, you're away
Speaker 2:from home. Yes. You're on the road. I got an 86. Sleep.
Speaker 2:Seven and a half hours. Our next guest, is Grant from Gamma. He's in the restroom waiting room. Now he's in BTU in all three d. Now this is Hayden.
Speaker 2:Oh, Hayden first.
Speaker 1:Oh, fantastic. Welcome to show.
Speaker 2:Been an ad, I guess.
Speaker 1:Squeezing in. Super How
Speaker 2:are you doing?
Speaker 1:Super excited to have you on the show here. We have, as as you know, a Uniswap alum Mhmm. Working on the team. We're very very grateful to have him. And it's great to meet you.
Speaker 11:Yeah. Great to meet you both. I actually wasn't planning on doing any anything today, but now, here I am.
Speaker 1:There you go.
Speaker 11:Yeah. Great to be here. Awesome.
Speaker 1:For anybody that has been living under a data center, introduce yourself and Uniswap.
Speaker 11:Yeah. So I'm Hayden. I'm the founder and CEO at Uniswap Labs. Uniswap is the largest decentralized exchange in the world. So for some context, it you know, if you annualize the past couple months of volume, it does about $2,000,000,000,000 a year in trading.
Speaker 11:You know, it's when you think about what when you think about what a decentralized exchange is, it's kind of you know, you could think of us as, like, a a YouTube to a Coinbase or Binance's Netflix. Right? So we have the upload function. And so people can, you know, create their own markets. We introduced this whole system called automated market making, which lets people create liquidity themselves.
Speaker 11:And so it sort of dramatically lowers the cost to the creation and access of financial markets. And we're sort of the one of the pioneers of what people call decentralized finance, which is this area of crypto that is focused on building decentralized, transparent financial infrastructure. And so, you know, Uniswap is is the the leading decentralized exchange in in that industry.
Speaker 1:Amazing. So we were live when your post hit the timeline. We have it pulled up now, but it would be awesome for you to kind of run us through kind of the news and and break it down for us.
Speaker 11:Yeah. And I can try to, you know, set some context here.
Speaker 1:Yeah.
Speaker 11:So there's there's kind of a bunch of different things here. So Uniswap launched about eight years ago or seven years ago. And maybe around five years ago, we launched this thing called the Uni token, which was a a token that was meant to govern the Uniswap ecosystem. And with within that so well, at a high level, what the protocol does is it introduces a economic system for the Uniswap protocol and the Uni token, and then it also basically refocuses Uniswap Labs on building value and and building on top of the Uniswap protocol. So, you know, we're kind of in this, like, moment in time where there's a bunch of different things happening in crypto, and part of what we're seeing is a lot of people almost, like, move crypto into traditional financial rails.
Speaker 11:And part of what you you know, they're they're sort of, like, almost trying to, like, IPO crypto companies or build these treasury companies. And what we're focusing on is doubling and tripling down on the technology itself and the, you know, the decentralized, protocol that we built. And so, you know, the the proposal, first, it turns on protocol fees. This has been a really big thing in the Uniswap world, for a very long time. People have kind of, you know, wondered when this would happen.
Speaker 11:But here, know, so the the protocol fees will be turned on and these are fees, for trading on Uniswap protocol as well as there's this chain that we built called Unichain, and those fees are also going to this, Uni burn system. There's also a essentially, a a burn of a large amount of Uni from the treasury, and this is basically representing all the fees that could have been. It's almost like symbolic. There's, there's been sort of a lot of, like, you know, speculation around when when this would happen. And so, I think that, you know, this is kind of like a a nod to that.
Speaker 11:And then I think beyond that, you know, Uniswap so one thing to kind of, like, give context here is that we were in this, like, crazy regulation by enforcement area for crypto. Essentially, you know, Gary Gensler and and the SEC sort of sued basically everyone in The who who lived in The US who was a crypto founder. And, you know, the the kind of incentives that created for the ecosystem, basically, said, if you do anything that builds value for our community, we're we're going to sue you. And then, actually and then, know, within that context, we were extremely, like, limited in how we could interact with with the world. And then, you know, we basically and then they sued us anyway, and then we you know, and then it was ultimately ultimately dropped.
Speaker 11:But I think so what's happening now is that there's sort of like a a very different kind of thing here. And so, you know, Uniswap Lab is really able to kind of lean into the, the Uniswap protocol and and building for it and focusing its its full kind of attention to that, where we spent a lot of the past few years focused on basically building a business around the products that we build on top of the protocol. So there's, like, this decentralized network, kind of like Bitcoin, and then there's, these apps and websites, kind of like, you know, a Bitcoin wallet or or an exchange built on top of Bitcoin. And so we've Yeah. Built, these products on top of the Uniswap protocol, and they have tens of millions of users.
Speaker 11:And so we've been kind of very focused at Uniswap Labs on building a business around that. But, you know, with this proposal, I think what what what we're kind of acknowledging and what we're we're we're we're saying is that the the really big opportunity here, much like the, you know, the the biggest opportunity of Bitcoin is the Bitcoin network, not each little application on the top. The the big opportunity here is the Uniswap protocol, and we want, you know, as as the sort of inventors of of this protocol and and people who've been developing for a long time, we wanna make that our core focus. And so we're, like, you know, leaning into that and kind of, making that our our full attention moving forward.
Speaker 1:What what does this mean for equity holders in Uniswap Labs, the company that that raised venture capital? Because I think part of what came out of the Gary Gensler era was you had this kind of like bifurcation of value where there was equity holders that got access to tokens, and so they had upside there. And it's all it it felt like, not not the kind of scenario that we'd see, let's say, in fifteen years from now when tokenization is is kind of the norm and this is a standard way to build companies and distribute value. But I'm curious what the what the proposal means for that kind of setup.
Speaker 11:Yeah. And it's it's a very perverse incentive to say, you know, if you do anything that creates value, that's the the bad thing to do versus and and that's sort how you end up with this kind of, like, thing where the only thing that was popular in crypto for a very long time was meme coins. And it was because they were, you know, they were the only thing that you could say, well, no one is trying to build any value. And so that's what became popular in crypto. And that's not really, like, what is exciting to me.
Speaker 11:Right? What's exciting to me is the idea of these, like, truly decentralized networks that that create value. And I think that for me, you know, what I want to align, you know, my work to to doing is what I think creates the most value in the world. And I think for for Uniswap Labs, the way that we think we can create the most value in the world is to lean into building this protocol. So so part of this proposal does include a a kind of a service provider relationship between us and and the the DAO that sort of aligns our, you know, our our kind of mutual kind of you know, or, like, that sort of, like, aligns our upside.
Speaker 11:And so, you know, in in this proposal, if we create a lot of value, then then we can kind of, you know, realize some of that. So the goal here is to really, like, align incentives.
Speaker 1:And do you think do you think more crypto companies that raised from traditional financial institutions will try to pursue these more aligned models going forward?
Speaker 11:Look, I I hope so. I think that, you know, everyone was sort of kind of dealing with what was possible, and and I think that people have kind of still, like, evolved and adapted. And, you know, a lot of you know, I I think that but my hope is that, like, the the crypto native things are what ultimately win, and I think that's kind of where I put my kind of bets. To me, you know, like, the point of the technology is is the is the like, the point of the of the industry is the technology. It it's like the decentralization.
Speaker 11:It's the idea that you can create, you know, financial application that you trust, not because you trust the company, but because the the code is is transparent and public and auditable and run by multiple independent parties. Right? This idea of, like, decentralized consensus and networks, it can be really powerful. And so I think that the more that, you know, projects lean into that, the the better off we are. There's sort of like this interesting, thing that happens.
Speaker 11:Like, all of the all of the fee for example, the fee system that that we're sort of proposing as part of this, every aspect of it is is transparent and public and auditable and verifiable in real time. And so people don't need, you know, quarterly reports from a company when you can have, you know, real time access to anyone in the world that's, like not just, like, public and transparent but also, like, cryptographically provable. And so, you know, there's sort of, like, different ways of accomplishing a lot of the goals that that various regulations have when you sort of, kind of, like, lean into the the unique nature of the technology.
Speaker 1:That makes a lot of sense. How's the reaction been? We we've been we've been streaming here, so I haven't been able to check the timeline. But this seems like something that both, you know, Uniswap super fans and and, you know, detractors would appreciate.
Speaker 11:Yeah. So it's it's only been about an hour and a half. You guys were fast to messaging me. But so far, I mean, from what I've seen, it has been extremely positive from a from a public redaction. Every everyone on on Twitter seems very happy, which is where most of crypto conversation happens.
Speaker 11:I guess it's it's x. I I still say Twitter. It's it's hard.
Speaker 1:It's hard not to. It's hard. Still happens to me every now and then. Well, congratulations. Big big milestone and Yeah.
Speaker 1:And feels like it's a a really positive direction
Speaker 2:in the
Speaker 1:whole industry.
Speaker 2:Here. Do you think this is gonna be a trend for other companies that are in a similar situation?
Speaker 11:Yeah. I I hope so. We're doing it because we think it's what's, you know, what's best in the way you know, we think leaning into to, you know, the centralization and the decentralized protocol is what's best. Yeah. And so I I hope that, you know, other people follow this trend as well.
Speaker 11:You know, I I think that a lot of people have been doing it, but they've mostly been doing it from, like, outside The US or in all these different ways and I think that, like but, ultimately, we really believe that this is, like, the right thing and that what what is sort of best for users and what's best Yeah. You know, world, which is why we're doing it.
Speaker 2:What what about on the regulation side? Is there anything to touch on there?
Speaker 1:Yeah. I would just be curious, with or or maybe the the the version of you that's earlier in their in their career, are they deciding to set up in The United States? I mean, I know you went through absolute hell for a number of years and and, being, you know, based in New York was was a big challenge. But are you seeing more younger crypto builders decide, hey. It's actually makes sense for me to set up in in, you know, a place like New York, one of the financial capitals of the world?
Speaker 1:Are you still seeing a lot of stuff happening offshore because people don't think it's worth the risk of potentially a new admin taking a different stance on crypto?
Speaker 11:Yeah. So I think, you know, for the past four years, it was a lot of people moving outside The US, and that was sort of the predominant advice that people got. And then what we've seen maybe over the past year is people start to come back to The US, and I have various friends who've kind of moved their offices and, who who run, crypto companies, who've kind of moved to New York. So we we're definitely starting to see a financial hub, and and a crypto hub form in New York. Brooklyn?
Speaker 11:It's actually it's actually particularly in SoHo, I'd say. Okay. But there are there's the Brooklyn hub, but there's kind of a a growing SoHo hub, to crypto. And I personally I love I love it here. You know, there's, like I could say that it was because I believed in the technology and that it would sort of you know, that being on the right side of history would ultimately prevail.
Speaker 11:But I will also say that,
Speaker 6:I just love
Speaker 11:it here as well, and I love living in New York, so I definitely hope more people come here. In terms of, like, the long term certainty, that's really where, like, this, like, market structure bill that's, that's being kind of discussed in, in congress is kind of pretty important as is the you know, some of the, like, up you know, what we expect would be upcoming regulations out of various regulators. And so, you know, the hope is to have, like, additional clarity and, clarity that makes sense with the technology. That's really important. Right?
Speaker 11:I think that was what was challenging before is is sort of regulators taking stances that just didn't make sense for the technology. Yeah. And and so, you know, the the hope is that the the sort of environment kind of like and we really you know, the hope is that long term, there isn't this sort of, like it it's, like, not a it doesn't, you know, it doesn't kind of stay a politicized topic long term, and the hope is that, really, it's just, like, people create sense you know, there's sensible regulations that come out of congress that sort of again, like, recognize that that, you know, the the software developers that create decentralized protocols are very different from, you know, a centralized financial institution that custody funds. Right? Those are that's just, like, fundamentally different things.
Speaker 11:And so the hope is to have that kind of really recognized and acknowledged at a at a federal scale. And once that happens, I think it will be, like, even more, you know, of of a slam dunk.
Speaker 1:SOHO SOHO crypto renaissance era will really will really begin. Well, great great to meet you. Thanks for coming on, and congratulations on on all the progress and the proposal. And we'll have to have you back on again soon.
Speaker 11:Yeah. Excited to come back on sometime.
Speaker 2:Thanks so much.
Speaker 1:Appreciate it. Great to hang. Cheers.
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Speaker 1:They bought a bunch of toys. Oh, no way. There was toys when I arrived.
Speaker 2:That's
Speaker 1:very The kids. And that made bedtime a challenge because it was like it looked like Christmas morning out there. But without further ado, we have the CEO of Gamma coming in. Welcome to the show.
Speaker 2:Welcome to the show. Sorry.
Speaker 1:So sorry to keep you waiting. Day.
Speaker 9:Hey, guys.
Speaker 1:But we're we're pumped to have you on and, talk about the news.
Speaker 9:Yeah. It's so great to be here, guys. Excited to share. We, just closed the series b from Andreessen at a $2,100,000,000 evaluation.
Speaker 1:There's some other You're you're, you're profitable too. Woah. Right? Is that right? Okay.
Speaker 9:We we are profitable.
Speaker 1:We've been profitable for two years. Two years.
Speaker 9:And we, so we we we we passed a 100,000,000 in ARR, all with a team of 50.
Speaker 1:50? Wow. That's incredible. Insane. That's incredible.
Speaker 1:What what makes Gamma why is it working so well? Yeah. Because we've seen some you know, this was a category that I think a lot of people were excited about couple years ago. We saw a ton of investment going into making making making, you know, decks specifically presentations with generative AI. And not everything is panned out but it seems to be working, incredibly well for you guys.
Speaker 1:So what what's the what's the secret sauce?
Speaker 9:I mean, we attribute a lot of it to actually getting started well before sort of this recent AI wave. Sure. We've been a company for five years now. So the first couple years, we actually focus a lot
Speaker 7:on just
Speaker 9:the the, the underlying editing experience. So can we create new building blocks that aren't traditional slides, you know, the 16 by nine format and allow like the average person, the everyday person that isn't a designer, doesn't have design skills to create much faster. And so two and a half years ago, we kind of married those building blocks with just reengineering the entire workflow within Gamma so that AI can actually really quickly assemble those building blocks fast, give the end user a really seamless experience.
Speaker 2:What about on the, how how can you talk about the shape of the user? Have you been selling direct to consumers, b to b? Is there some sort of, like, you know, Dropbox did, like, the viral web, the the the consumer software viral loop where I send it to you, you install, you become a customer, we upsell, or is it more, you know, SDR led? How are you thinking about the actual growth, engine for the business?
Speaker 9:Yeah, definitely. So where we started, we actually started much with much more of a prosumer base of users.
Speaker 2:So you
Speaker 9:can imagine anybody that has to do a lot of external facing communication, whether you're a freelancer, solopreneur, small business owner, someone that needs to create a lot of decks, we made it dead simple for them to get started. For them the beauty is that, you know, they're not locked into the Microsoft suite, the G suite, they can they have the freedom to choose whatever tool is best for the job. And so they're able to pick up our tool, use it. By nature of our category, we're lucky that if you like using Gamma, you're sharing and presenting with others. Right?
Speaker 9:There's organic virality baked into the use of the product. So as the product has gotten better, more and more people use it, share it, share it in many different ways and that allows us to, you know, essentially acquire more and more users for extremely cheap.
Speaker 2:Mhmm.
Speaker 1:How big is the market for DeX? Because I I mean, I I I feel like it's hard for me to get a sense of, like, you know, how big the market is for, like, actual infrastructure for creating decks, software for creating decks. Obviously, the market for decks is in the hundreds of billions, I'm sure, if you add up all the different consulting groups and things like that. But but, yeah, how how do you look at that market? You're you're multi product now, but, do you do you expect that Decks will be something, you know, kind of one of the the biggest product line in in five years, ten years?
Speaker 1:Or do you guys really wanna go wide?
Speaker 9:Well, yeah. So even if we just start with the category presentations to your point, it it's massive. Right? So Google Slides, 800,000,000 monthly active users, you know, and then you add PowerPoint. We're talking well over a billion monthly active users.
Speaker 9:And that's just in that one category. Then you think
Speaker 1:about PowerPoint has a billion monthly actives. Assets. When you
Speaker 9:add Google Slides and PowerPoint together, you know. So we're talking about category where today and that's with, you know, a product that's still pretty manual and tedious to use. Now imagine Gamma automating a ton. Our API is going to actually make it so that anybody can actually build on top of our platform as well. So if you have a business where content creation is can be core to your infrastructure, you can now build on top of Gamma.
Speaker 9:So no longer even manually creating content. It's it's gonna be a massive market.
Speaker 1:And so so that API business, is that, you know, another SaaS company that wants to make it easy to generate reports that that users can walk people through the organization?
Speaker 2:Oh, that's
Speaker 1:is that kind of a use case? It's like, hey, take your data. We'll turn it into a beautiful presentation automatically that you can run a meeting with?
Speaker 9:So there's actually multiple different layers. You know, layer one I'll call kind of just an extension of our prosumer business today. So imagine if you're already using Zapier, you can combine that with your favorite tool. So granola for notes for instance. If you're a freelancer, you take all your notes in granola, the moment the meeting is over, you can take that meeting transcript, feed it into Gamma and create a very personalized deck going back to your clients saying, hey, these are all the things we discussed.
Speaker 9:These deliverables. These are the action items we agreed on. And you get a beautiful PDF sent directly to them right after. So that's like a prosumer use case. Then there's like b2b use cases where, you know, in the future we'll partner with platforms like Glean where Glean is sitting on top of company knowledge.
Speaker 9:If anybody internally wants to create a QBR or strategy deck, they can pull that into Gamma, automate the content creation, create a beautiful deck so that you can use that for a meeting or discussion. And then one of the use cases you alluded to is what if other developers can build on top of gamma. So imagine you have like a real estate app, your real estate app, you know, you're you want to build a empower your users anytime they look up a listing, or look up, know, a zip code, they want a, you know, a PDF of all the different listings in that zip code. Well, we can power all that content creation, build a beautiful report so that app company focuses on the app itself, not on the content infrastructure. And we can essentially operate in the background, send that beautiful PDF with all the listings for that particular zip code to the end user for that particular app.
Speaker 1:Are you gonna keep the team lean going forward? Are you gonna develop some hubris and hire like 400 people? What's the plan?
Speaker 2:DocuSign numbers. Get to the DocuSign numbers.
Speaker 9:Yeah. You know, we've, we've always tried to do things maybe a little bit different. You know, we raise as little as we can. We build a super lean team. We we continue to, you know, I think we're gonna continue to do that no matter what.
Speaker 9:And so, lean is obviously, you know, relative to, you know, we have big ambitions and so the team is going to get bigger. We're definitely hiring. But relative to our traction, I think we're we're still gonna be, you know, pretty small.
Speaker 1:Did you ever think about raising 67,000,000?
Speaker 9:You know, it's a it's a good question. We felt like we really needed that extra million just in case.
Speaker 1:Never know. Opportunity for the meme meme potential. Somebody else has to do that. Well, awesome. Crazy crazy crazy progress, And I love to see a winner coming out of this category.
Speaker 1:Everybody has been through the pain of making presentations. There were so many. I'm thinking of Tome. I think there was, and there was pitch.com. All these companies had tried to crack this problem and just didn't quite It's been figured out.
Speaker 2:A has a company.
Speaker 1:Oh, yeah. Ed, you're competing with
Speaker 2:that company.
Speaker 9:We got competition from everywhere. You know? Yeah.
Speaker 1:Yeah. Needs something to break into. Yeah. Something's working. Working.
Speaker 1:Well, great to meet you. Congratulations. And I'm sure we'll see you on here for this was the was this series a or b?
Speaker 9:Series b.
Speaker 1:Series b. Okay. We'll see you on here for the c. Looking forward
Speaker 9:to Thanks thanks so much, guys. Great to
Speaker 2:meet you. Good to be here. We'll see you soon. Let me tell you about Bezel. Your Bezel Concierge is available now to source you any watch on the planet.
Speaker 2:Seriously, any watch. Bucco capital bloke said, I just don't see a world where corporate budgets for AI will be smaller in 2026 than they were in 2025. I think they will be much bigger. Got room to run, baby.
Speaker 1:Somebody come somebody commented, then you're out of touch with the world and stuck in a home office. But says, that doesn't even make sense.
Speaker 2:That doesn't make sense, of course, because if you're in the home office, you wouldn't under no. Yeah. I I don't get that at all. That's very confusing.
Speaker 1:Alex Cohen says, if a startup requires you to be in office twelve hours a day, six days a week, you should run the f away like your life depends on it. Apparently, this company, Giga, which has been going viral, what is are they actually saying that you need to be in the office twelve days a week? Or, sorry, twelve hours a day?
Speaker 2:Someone someone said that they got hired in April to lead DemandGen for them. They quit after the first day. There were red flags. When we hit 10,000,000 ARR, we're gonna spend a 100 k on blank illegal stuff. We're doing, blank and MRR.
Speaker 2:The dashboards in the headquarters showed six x less. You know, in office seven days a week, twelve hours a day, PTO policy is subject to change, blah blah blah blah. You you are expected to always be working. Gave an offer letter on Wednesday. So sort of
Speaker 1:like They chopped off a goat's head in India because it brings good luck.
Speaker 2:Aggressive. I wonder I wonder, have they responded? Has Giga, like, responded to this and said, this is not real? Because that would be important, I guess, if they have to because somebody's, like, making this claim about them. It should be sort of, like, you know, debated because, we don't know, you know, when someone when someone makes a claim like this, there's a bunch of different motivations that could be behind it.
Speaker 2:I don't know. Hopefully I I saw Giga did a did an interview with Harish Tagar from YC, and they seem to be getting some traction in their market, and there seems to be some good stuff. I mean, there's nothing wrong each one of these needs to be, like, kind of evaluated in in and of itself. There's nothing particularly wrong with working very hard if everyone's in on it and everyone's happy with it. So we'll we'll see.
Speaker 2:Yeah. Stay tuned for the response from the gig.
Speaker 1:Yashan says my AI investment thesis is that every AI application startup is likely to be crushed by rapid expansion of the foundational model providers.
Speaker 2:He's still bearish on the application layer. That's interesting. That was a a take from, like, a year or two ago, that it kind of got out of fashion. What do you think, Tyler?
Speaker 1:Well, yeah. So one thing so Elon quoted it and says seems to be accurate. But one thing that's kind of interesting here, Sam Altman, with Tyler Cowen, they were talking about, like, an AI native Slack. A lot of people were saying, like, request for startup. Like, who's building this?
Speaker 1:And it's like, you have to assume that Sam is gonna, like, he runs his business on He cares a lot about
Speaker 2:He do Gmail.
Speaker 1:Yeah. He cares a lot about enterprise. He wants ChatGPT to be an agent that's working in your company twenty four seven. You think he's just gonna be like, oh, yeah. Someone else should build that.
Speaker 1:I don't care about the enterprise. Someone else should build the AI native Slack.
Speaker 2:Yeah. I don't know.
Speaker 1:I would just assume that that he's building that.
Speaker 2:Yeah. Yeah. Yeah. Yeah. We'll we'll we'll see.
Speaker 2:What do think? Is there still value in the in the application layer? Or are you so AGI pilled that it's it it doesn't matter? Just just hoard electrons.
Speaker 6:I mean, yeah. This was like the original, like
Speaker 1:like, wrapper was like a slur almost. Yeah. Totally. It's like, oh, you're starting a wrapper company. Yeah.
Speaker 1:Like, it's like totally fake thing.
Speaker 2:Yeah.
Speaker 6:But I think that the kind of rapper trade has done very well.
Speaker 2:Oh, totally. It's done super
Speaker 6:well. So yeah. Mean, they're they're
Speaker 2:look at Giga. They're pro or or not Giga, but Gamma. They're they're profitable. 100 mil ARR.
Speaker 6:I think people massively overestimate how much like, how many different things that these foundation model companies could actually do. Yeah. Like, you just can't allocate that many engineers with,
Speaker 1:like, so many different products.
Speaker 2:I I disagree. It's it's not that. It's it's the capabilities of the fundamental underlying model. Because there is a world where you go to the the just the base weights of GPT 10, and you say, generate me a 10 slide deck that pitches my product to this customer, and it just generates it all, and it just does it all. And and it Yeah.
Speaker 2:And and what that it is outputting are essentially PPTX
Speaker 1:And it generate files. UI on the fly that allows you to edit the output. It should. Even even the most even the smartest designers, best designers I've ever worked with, rarely are they just one shotting a task where I'm like, no more Yeah. You know, you wanna get in there and, like, switch it up yourself.
Speaker 2:Yeah.
Speaker 6:Right? Yeah. But, like so look at Cloud Code. Cloud Code is just I mean, it's just a base model with some scaffolding. Right?
Speaker 2:Yeah.
Speaker 6:You can think of it as, like, the actual capabilities of the model aren't incredible. But if you add, basically, you know, essentially a a really nice four loop, it gets way better. Mhmm. That's just like extra engineers that are just like normal software engineers. Sure.
Speaker 6:You could see that Anthropic do the same thing where they bring, you know, they they put a group of 10 engineers, and they say, make this better at building PowerPoints.
Speaker 1:Yes. Don't do that
Speaker 2:because No. No. Yeah. Yeah. No.
Speaker 2:I I I agree with that. Like like but there was a scenario where, like, Cloud Code would be the Cloud Code for PowerPoint because you can go to Claude code and tell it, hey. Iterate on the for loop generating PowerPoint.
Speaker 6:Yeah. I I think that's still not so crazy. Like Yeah. Not. You've talked about this thing where you you use Cloud Code
Speaker 1:to do, like, a research and Exactly.
Speaker 6:A nice HTML file. Yeah. Yeah. That's a PDF. That's Yeah.
Speaker 6:Yeah. You know, use that.
Speaker 2:Just PDF and it's
Speaker 1:the end
Speaker 6:of it. It's a Word doc.
Speaker 2:Yeah. You know? So there is there is a world where, like, yeah, the application layer still still, you know, faces significant competition from the Foundation Model Labs. Let's read Ishaan's he's also the former CEO of Reddit.
Speaker 1:Correct? Yes. I'll be right back.
Speaker 2:So Ishaan says, my AI investment thesis is that every AI application startup is likely to be crushed by rapid expansion of the foundational model providers. App functionality will be added to the foundational model's offerings, because the big players aren't slow incumbents. It is wrong to apply the analogy of fast startup slow incumbent here. They are just big for far more, far more so than with any other new, prior new technology. There is a massive and fast moving wave that obsoletes every new app as almost almost as fast as it can be invented.
Speaker 2:There's almost no time to build a company and scale it. There are two ways AI application startup founders can make money. Make a flash in the pan app that generates a ton of cash and bank the cash. My estimate is that you have about, twelve to eighteen months cash flow generation. Make a good enough app that you get acquired by one of the big players for sufficient equity.
Speaker 2:The situation is highly unstable. We don't know if it's going to crash or go to the moon, but both scenarios make it very unlikely that any AI application startup will independently become a generational super company. Baseline odds are low to begin with. I sort of agree with that. That makes sense.
Speaker 2:The best odds are finding an application niche in a highly specialized field with extremely unique and specific data barriers, ideally ones relating to real atoms, hardware, or world related data and not software slash finance. Interesting.
Speaker 6:Yeah. I mean, I I think, like, if you're a normal kind of consumer wrapper company, you probably did not like seeing what OpenAI was doing this summer where they had, oh, we have a Expedia plug in and now it's you can use, you know, Figma. You can use it straight in the in the, you
Speaker 2:know Sure. Sure. Sure. Yeah.
Speaker 6:I I think there there are still plenty of startups that, like, are quietly just, like, dying from from better models or just more, like, productized, you know, features in the actual chat interface or whatever.
Speaker 2:Yeah. Yeah. I do wonder about the shape of that curve because it's like it's clear that like, OpenAI used to just be such a monolith in the sense that it was just like train bigger transformer, train bigger transformer. That's what OpenAI is. At least that was like the the the view from the outside.
Speaker 2:And then it became like, okay. ChatGPT the app, but then also, like, enterprise stuff and then also API and then also Sora and also Dolly. And and and at one point, do you remember do you remember the Dolly UI? Do you remember there was, like there was a moment where Dolly was turning into, like, Photoshop in the browser, and you could actually, like, edit and highlight different regions. And you could do, like, in painting where you could, say, generate an image here and then generate an image next to it, generate an image.
Speaker 2:You can kinda block it altogether. And they were, like, building an application on top of the image model. And I don't know if that disappeared. I maybe we just don't talk about it anymore. May maybe they're still working on it, but there were a number of different I I imagine that they have a vid like, a a visualization of different SaaS categories that they could potentially go after just like Google did with, you know, on prem software.
Speaker 2:Like, what's not in the cloud? Well, email's not in the cloud. Well, PowerPoint's not in the cloud. Well, Google Slides. You know, spreadsheets aren't in the cloud.
Speaker 2:Instead of Excel, let's go to Google Sheets. And then and Google just kind of chopped down that. And so OpenAI could be doing something very similar looking at, like, what's not AI ified, what's not AI native.
Speaker 6:Yeah. I I think it's definitely wrong to say that this, like, question of whether rappers are, like, long term valuable, I think it's, like, very much still an open question.
Speaker 2:Yeah. Yeah. Yeah. Yeah. It'll be interesting to see.
Speaker 2:There will definitely be some folks who get out early. There's be some folks that figure out ways to to be durable. It'll probably be a mixed bag.
Speaker 1:Jaguar Analytics says the strategy Ponzi scheme is blowing up. They have 689,000,000 of interest due in 2026 that they don't have. Saylor is enticing investors by raising yield by 25 basis point to 10 and a half percent on preferred shares to raise capital to keep running the Ponzi while collateral deflates in value. So they currently have about 50,000,000 of cash on hand in order to pay that interest. They can raise, more debt at this, you know, relatively high rate, 10 and a half percent.
Speaker 1:They currently have about eight and a half 8,200,000,000.0 of debt. The market value of their Bitcoin is roughly 65,000,000,000, and the company is sitting at a $68,000,000,000 market cap. It's down 40% in the past six months. And so we will
Speaker 2:see So so strategy is now trading at book value essentially. Is that right?
Speaker 1:It's trading at 68,000,000,000, but they have 80 bill 8,000,000,000 of debt.
Speaker 2:Okay. Okay.
Speaker 1:And so
Speaker 2:So so net of debt, they're still a little bit high, a little bit above where asset value is. Interesting. Apparently so this is in the Wall Street Journal too. I guess everyone's writing about this right now.
Speaker 1:But The stimi checks coming back. Yeah. The tariff dividend. Someone's excited for the stimi are excited about it.
Speaker 2:Excited for the stimulus checks. Everyone's pumped. Yeah. I mean, the the original MicroStrategy trade was, like, it was hard to buy crypto in on certain platforms. It was hard to buy, it was hard to buy crypto in your IRAs.
Speaker 2:In institutions. Yeah. And MicroStrategy gave folks a way to do that, and it still exists. There is some sort of arbitrage still, but, just purely getting access to Bitcoin is
Speaker 1:Guess what day MicroStrategy peaked in in the .com bubble? Wait. What?
Speaker 2:Oh, .com. Oh, they've been around that long.
Speaker 1:That's right. So the criticism of Sailor is that, like, he was, like, he was a it was a a kind of a bub guy.
Speaker 2:Sure.
Speaker 1:Speaking of that whole world.
Speaker 2:And the bull case study seems relentless. He's still around.
Speaker 1:He the the stock peaked 03/10/2000.
Speaker 2:Wow. There you go. 03/10/2000. So MicroStrategy was worth about 128,000,000,000 at its peak in July. It is now worth about 70,000,000,000.
Speaker 2:So, I mean, a pretty significant sell off. And interestingly, Bitcoin has not sold off in the same way. It's it's purely the the market mood changing around crypto treasury companies, apparently. Very, very fascinating. There's, yeah, there's a lot here.
Speaker 2:But we can go into it some other time. Anything else in the timeline, Jordy, that we should be looking?
Speaker 1:We are well well over We're in the fourth hour, baby. We're well we're in the fifth hour. And we're the fifth
Speaker 2:We're in the fifth
Speaker 1:for six. Let's go for six.
Speaker 2:In the fourth hour, I start asking our guests the same questions that Jordan asks. I just get so lost.
Speaker 1:It happens.
Speaker 2:It's like a million text messages. Anyway, stimulus checks are back. This is true apparently, or at least it's, like, rumored or it's at least it's truth. It's on it's not necessarily true yet, but it's on truth social. So
Speaker 1:Warren Buffett We'll be paying a tariff
Speaker 2:tariff dividend of 2,000.
Speaker 1:Letter that says he's I'm going quiet.
Speaker 2:What? Warren Buffett says he's going quiet?
Speaker 1:He says in one of, this is in Times today. He says in one of the his final missives as the company's leader, mister Buffett said he would accelerate his plans to disperse his fortune to his children's foundations. My children are now at their prime in respect to experience and wisdom, but have yet to enter old age. He he he's talking about his daughter and two sons who range in age from 67 to 72. And can
Speaker 2:You know they're
Speaker 1:still sitting on How much lot of cash.
Speaker 2:He's got a lot of cash. The Rockefeller Center Christmas tree has been delivered. Let's hear it for the Rockefeller Christmas is officially here in New York City.
Speaker 1:We need some Christmas. I need some Christmas sound effects on the soundboard. We gotta bring the Christmas spirit.
Speaker 2:Oh, yes. We need
Speaker 6:I need some bells.
Speaker 2:Ho ho bells, jingle bells. Christmas has officially started. Christmas. Today, I'm calling it. We're Christmas maxing now.
Speaker 2:Very fun show. Thank you for watching. Tune in to
Speaker 1:Wait. We have to read this last post
Speaker 2:One last post.
Speaker 1:From Andrew Reed.
Speaker 2:Last post. Says the
Speaker 1:top real estate agent in Hillsborough, Burlington is this guy named Stanley Lowe. And on his website, he says
Speaker 2:What'd he say?
Speaker 1:That diminutive risk takers speaks with competitiveness, cockiness, and conviction of a salesman who loves the business and rarely doubts his ability to succeed against all comers and all odds. While some will attempt to impugn the green banker operation as a high end real estate machine, those who have transacted with the firm see it for what it is, a successful responsive juggernaut that reflects the personality and determination and discipline of one man, Stanley Lowe, and the perpetual motion of a real estate operation that never slackens in its quest to stay atop the real estate pyramid. What what a bar. What a bar. And look at this guy.
Speaker 1:He's suited up looking like an absolute g.
Speaker 2:He's actually at the top.
Speaker 1:You gotta work on getting Stanley on this show.
Speaker 2:That's not him. That's like a toy of him. Is it?
Speaker 1:Oh, it
Speaker 2:I'm confused.
Speaker 1:I think this is a real picture of him. I think it may Might be little bit of Photoshop.
Speaker 2:Okay. Something weird's going on here. It looks like a it looks like a like a toy or something.
Speaker 1:And then and then our final final post
Speaker 2:Okay.
Speaker 1:We're not gonna get to the story. Think it's been light. Maybe we'll get to it tomorrow. But Sam says there's locking in and then there's locking in. How this 31 year old made a quarter billion dollars in thirty months trading Russian oil when sanctions meant others stopped.
Speaker 2:Yeah. This is a great story in the financial
Speaker 1:An absolute dog.
Speaker 2:Dig into it. But stay tuned for more TBPN tomorrow, 11AM Pacific. Tune in.
Speaker 1:Can't wait. Can't wait.
Speaker 2:We'll see you then. Until then, leave us five stars on Apple Podcasts and Spotify. And if you're looking for a shorter version of the show, although if you're in hour five, I doubt you are. But in general, if you're ever missing this show, we have a product called Diet TBPN. We edit down the whole show, bring it to you Thirty minutes.
Speaker 2:Twenty, thirty minutes, something like that.
Speaker 1:All the flavor
Speaker 2:All the flavor.
Speaker 1:And only 30 calories.
Speaker 2:Only thirty minutes of your time. You can listen to it on two x, I guess, you want to.
Speaker 1:We will see you tomorrow.
Speaker 2:See you tomorrow.
Speaker 1:Goodbye. Cheers.