1 00:00:00,100 --> 00:00:04,170 Josh: The question on everyone's minds, should you buy the SpaceX IPO? 2 00:00:04,410 --> 00:00:07,770 Josh: By the time you are hearing this, chances are SpaceX is about to go public or 3 00:00:07,770 --> 00:00:13,140 Josh: they have just gone public at what is going to be the largest IPO in history. 4 00:00:13,470 --> 00:00:16,730 Josh: And it's not even close. I think we have very strong takes and opinions on where 5 00:00:16,730 --> 00:00:19,070 Josh: SpaceX goes. I find the question that everyone is asking me is, 6 00:00:19,250 --> 00:00:20,880 Josh: should I buy? Is this overvalued? 7 00:00:21,150 --> 00:00:25,380 Josh: It's going to be trading, I mean, right now, close to $2.1 trillion beforehand. 8 00:00:25,380 --> 00:00:27,300 Josh: That's an outrageous valuation. 9 00:00:27,600 --> 00:00:30,410 Josh: And I feel very confident that we have some pretty good takes that are going 10 00:00:30,410 --> 00:00:31,510 Josh: to point in the direction of 11 00:00:31,880 --> 00:00:36,900 Josh: actually yeah not only is it a good buy in fact it's undervalued and a lot of 12 00:00:36,900 --> 00:00:41,100 Josh: the news that we got this week from the s1 from the new spacex releases backs 13 00:00:41,100 --> 00:00:45,250 Josh: that up so there's a lot of really strong prevailing wins pushing spacex forward 14 00:00:45,560 --> 00:00:49,930 Josh: and we are going to now address the question should you buy spacex shares should 15 00:00:49,930 --> 00:00:53,280 Josh: you get invested in the ipo and more importantly why. 16 00:00:54,240 --> 00:00:56,640 Ejaaz: Yes, the answer is yes. But before 17 00:00:56,640 --> 00:01:00,760 Ejaaz: we get into it, let's talk about the numbers of the IPO very quickly. 18 00:01:00,760 --> 00:01:07,070 Ejaaz: So they're raising $75 billion, which is three times larger than the largest 19 00:01:07,070 --> 00:01:11,300 Ejaaz: IPO that has happened so far. That was from Saudi Aramco back in 2019, 20 00:01:11,300 --> 00:01:13,640 Ejaaz: and they raised just under $30 billion. 21 00:01:14,300 --> 00:01:19,140 Ejaaz: This is roughly around 3x that, but the demand for the $75 billion raise is 22 00:01:19,140 --> 00:01:21,160 Ejaaz: already 4x, as you're seeing on the screen. 23 00:01:21,160 --> 00:01:26,120 Ejaaz: There's over $250 billion worth of demand with one institution or a couple of 24 00:01:26,120 --> 00:01:30,480 Ejaaz: multiple institutions offering up $10 billion chunks just to get involved here. 25 00:01:30,480 --> 00:01:33,650 Ejaaz: Now, if you're looking at like the price per share, roughly, 26 00:01:33,910 --> 00:01:38,240 Ejaaz: SpaceX's S1 prospectus has put it at around $135 a share. 27 00:01:38,240 --> 00:01:41,690 Ejaaz: Now, what's interesting about this is typically with an IPO prospectus, 28 00:01:41,970 --> 00:01:45,800 Ejaaz: you provide a range, you provide a range and you try and find where the match is. 29 00:01:46,040 --> 00:01:48,300 Ejaaz: SpaceX just went right to the high end of that 30 00:01:48,300 --> 00:01:48,700 Josh: Range and said it's. 31 00:01:49,400 --> 00:01:55,070 Ejaaz: $135 per share, which values it at $1.75 trillion. 32 00:01:55,340 --> 00:01:59,300 Ejaaz: But recent reports from Financial Times and Bloomberg says that this number 33 00:01:59,300 --> 00:02:07,500 Ejaaz: is actually now close to $162 per share, which gives them a crazy $2.1 billion valuation. 34 00:02:07,500 --> 00:02:10,790 Ejaaz: Now, the demand for this thing, Josh, is absolutely insane. 35 00:02:10,790 --> 00:02:15,580 Ejaaz: They reserved, I think it was around 30% of the share allocation that they're 36 00:02:15,580 --> 00:02:18,980 Ejaaz: IPOing with for the retail, for the regular average person. And then that was 37 00:02:19,220 --> 00:02:22,280 Ejaaz: distributed to the likes of financial institutions and banks like Charles Schwab, 38 00:02:22,280 --> 00:02:25,570 Ejaaz: as well as brokers such as Robin Hood and 39 00:02:26,170 --> 00:02:28,550 Ejaaz: The demand initially required you to have like something crazy, 40 00:02:28,550 --> 00:02:32,000 Ejaaz: like half a million dollars in your bank account in some cases to get access to this thing. 41 00:02:32,290 --> 00:02:36,060 Ejaaz: But they reduced that kind of like limit. But it is the most in-demand thing. 42 00:02:36,060 --> 00:02:40,870 Ejaaz: SpaceX is the most in-demand company in general, like whether it's just to buy 43 00:02:40,870 --> 00:02:44,330 Ejaaz: the IPO or whether it's just to like work there. It is a crazy scene that we 44 00:02:44,330 --> 00:02:46,510 Ejaaz: haven't seen before. Largest IPO raise ever. 45 00:02:46,760 --> 00:02:50,230 Josh: Yes. And it is also by far the most accessible IPO ever. We mentioned this in 46 00:02:50,230 --> 00:02:54,630 Josh: a previous episode, but 30% of the entire share float is being made available 47 00:02:54,630 --> 00:02:56,640 Josh: for the public, for retail, as a part of this IPO. 48 00:02:56,940 --> 00:03:00,480 Josh: This is three to five times more than the average, and that means that a lot 49 00:03:00,480 --> 00:03:03,260 Josh: of people are able to participate. So there's a chance if you're watching this, 50 00:03:03,260 --> 00:03:07,590 Josh: you've actually been allocated IPO shares of SpaceX at the listing price. 51 00:03:07,590 --> 00:03:08,680 Josh: You don't have to pay that premium. 52 00:03:08,940 --> 00:03:11,700 Josh: We're going to see the market making happen today as you're watching this to 53 00:03:11,700 --> 00:03:12,880 Josh: see what it's actually going to launch at. 54 00:03:13,170 --> 00:03:14,510 Josh: But I suspect a lot of people watching 55 00:03:14,510 --> 00:03:17,550 Josh: this episode are actually already shareholders and owners of SpaceX. 56 00:03:17,820 --> 00:03:20,400 Josh: And that's such a cool thing that everyone is able to participate. 57 00:03:20,400 --> 00:03:24,750 Josh: Now, in terms of the valuations of SpaceX, why we believe this is undervalued, 58 00:03:24,750 --> 00:03:29,140 Josh: why we believe SpaceX is going to be such a remarkable company, there's a few pillars. 59 00:03:29,450 --> 00:03:33,220 Josh: The first is Starlink. It is internet and space from the sky. 60 00:03:33,790 --> 00:03:38,560 Josh: The second is manufacturing, their ability to manufacture Starship and get payload 61 00:03:38,560 --> 00:03:40,370 Josh: to orbit at a very low cost per kilogram. 62 00:03:40,570 --> 00:03:43,490 Josh: And the third, which is one that I really want to talk about right now, 63 00:03:43,490 --> 00:03:45,670 Josh: is AI data centers in space. 64 00:03:45,980 --> 00:03:48,780 Josh: We've talked about this a lot. what does this look like? How does it work? 65 00:03:48,980 --> 00:03:52,250 Josh: Well, earlier this week, we finally got an answer, and it comes in the form 66 00:03:52,250 --> 00:03:54,390 Josh: of a satellite named AI-1. 67 00:03:55,360 --> 00:03:59,920 Josh: AI-1 is the satellite that SpaceX is going to park on Starship, 68 00:04:00,110 --> 00:04:03,870 Josh: send into orbit and actually put these things into space. And they're going 69 00:04:03,870 --> 00:04:06,760 Josh: to be training data centers. They're going to be beaming data back down to earth. 70 00:04:07,050 --> 00:04:10,060 Josh: And now we finally have a rendering and we have some specs on what it's going to look like. 71 00:04:10,370 --> 00:04:16,060 Josh: In terms of power, there is 150 kilowatt peak with 120 kilowatt average on each 72 00:04:16,060 --> 00:04:17,560 Josh: one of these satellites for reference. 73 00:04:17,850 --> 00:04:21,730 Josh: That's about 100 American homes worth of power per satellite. 74 00:04:22,710 --> 00:04:26,710 Josh: And then we're getting about 70 kilowatts per ton. So that's the efficiency 75 00:04:26,710 --> 00:04:28,100 Josh: part of the launch metrics where, 76 00:04:28,790 --> 00:04:34,150 Josh: The more energy we can get per ton, the cheaper it costs. It's lowering those costs. 77 00:04:34,510 --> 00:04:38,080 Josh: We have compute slots that are interchangeable. And I think this is a really 78 00:04:38,080 --> 00:04:41,720 Josh: underrated part is the GPU modules that you're seeing on the screen on the animation 79 00:04:41,720 --> 00:04:43,560 Josh: we were just showing, they're actually hot swappable. 80 00:04:43,760 --> 00:04:49,240 Josh: So you could have NVIDIA chips, you can have Google chips, you could have Amazon chips there. 81 00:04:49,370 --> 00:04:52,590 Josh: What they're going to test this with initially is going to be NVIDIA's Vera 82 00:04:52,590 --> 00:04:55,330 Josh: Rubin platform. That's going to be on version one of these things. 83 00:04:55,630 --> 00:04:59,620 Josh: And in terms of the radiator because clearly no one believes that spacex is 84 00:04:59,620 --> 00:05:02,680 Josh: capable of figuring out thermodynamics in space given the fact that they have 85 00:05:02,960 --> 00:05:05,830 Josh: how many thousands of satellites currently operating in there well they figured 86 00:05:05,830 --> 00:05:08,590 Josh: it out they said they're going to have 110 square, 87 00:05:09,160 --> 00:05:14,920 Josh: meter liquid radiator and basically it's just gigantic sails that we're seeing on screen right now, 88 00:05:15,480 --> 00:05:19,730 Josh: to dissipate the heat into deep space deep space is a huge place even if you're 89 00:05:19,730 --> 00:05:23,390 Josh: in low earth orbits geosynchronous orbit and the wingspan of those will extend 90 00:05:23,390 --> 00:05:26,980 Josh: to about 70 meters wide which is wider than a Boeing 747. 91 00:05:26,980 --> 00:05:31,100 Josh: So this is AI data centers in space. When we say that, this is what it looks like. 92 00:05:31,300 --> 00:05:33,760 Josh: This is how it's going to function. It's a really big deal. 93 00:05:34,280 --> 00:05:37,860 Ejaaz: I want to shine a bit more light on this satellite because previously, 94 00:05:37,860 --> 00:05:41,560 Ejaaz: like Elon has just made bold claims saying that, you know, the valuation that 95 00:05:41,560 --> 00:05:45,960 Ejaaz: we're raising SpaceX at now at a $2.1 trillion valuation is primarily based 96 00:05:45,960 --> 00:05:47,490 Ejaaz: on AI data centers in space. 97 00:05:47,740 --> 00:05:50,950 Ejaaz: And then they kind of signed a few deals recently with Google and Anthropik 98 00:05:50,950 --> 00:05:53,220 Ejaaz: saying, yeah, they're going to be buying these data centers in space, 99 00:05:53,220 --> 00:05:56,500 Ejaaz: but we still didn't know how. Now we have the answer and we have a bunch of 100 00:05:56,500 --> 00:06:00,790 Ejaaz: the numbers and how it's built. Now, to be clear, what does this satellite look like? 101 00:06:01,190 --> 00:06:05,980 Ejaaz: Picture a refrigerator that you have at home with 70 meter wings. 102 00:06:05,980 --> 00:06:09,190 Ejaaz: This thing is 95% wing, basically. 103 00:06:09,530 --> 00:06:13,820 Ejaaz: And that refrigerator is essentially a GPU server rack. 104 00:06:13,820 --> 00:06:20,160 Ejaaz: It stores around 72 NVIDIA GB300 GPUs. And the total compute power that it has 105 00:06:20,380 --> 00:06:25,140 Ejaaz: is around 150 kilowatts. Now, immediately after announcing the satellite, 106 00:06:25,810 --> 00:06:31,860 Ejaaz: Elon also stated that he's filed to launch 1 million of these data center racks, 107 00:06:31,860 --> 00:06:35,030 Ejaaz: these satellites, these AR-1 satellites into space. 108 00:06:35,250 --> 00:06:39,390 Ejaaz: If he is able to pull that off, the total compute power that will be orbiting 109 00:06:39,390 --> 00:06:41,900 Ejaaz: in space will be around 120 gigawatts. 110 00:06:41,900 --> 00:06:47,260 Ejaaz: That's around 3 to 4x of the total data centers that currently exist on the 111 00:06:47,260 --> 00:06:49,530 Ejaaz: entire surface of Earth right now. 112 00:06:49,530 --> 00:06:53,240 Ejaaz: So that is a hell of a lot of compute, but more so currently there's around 113 00:06:53,240 --> 00:07:00,330 Ejaaz: 14,000 satellites in total existence across every single other company in low orbit space right now. 114 00:07:00,530 --> 00:07:04,930 Ejaaz: So Elon is like aiming for like multiples more of that for this particular satellite. 115 00:07:04,930 --> 00:07:07,440 Ejaaz: Now, the wingspan is really important. You must be thinking like, 116 00:07:07,440 --> 00:07:09,300 Ejaaz: you know, 70 meters is absolutely ridiculous. 117 00:07:09,530 --> 00:07:12,930 Ejaaz: Radiation, you need to disperse the heat. It's kind of like hard to do that 118 00:07:12,930 --> 00:07:15,180 Ejaaz: in space. In fact, it's impossible to do that in space. So you need some kind 119 00:07:15,180 --> 00:07:19,960 Ejaaz: of like really ingenious cooling mechanisms. That's what that wingspan is for. 120 00:07:20,250 --> 00:07:21,980 Ejaaz: Yes, it is large, but also 121 00:07:22,460 --> 00:07:25,150 Ejaaz: You're in space. You have all of that space to be able to do that. 122 00:07:25,380 --> 00:07:28,810 Ejaaz: And the way that these satellites are designed is different to the ground data 123 00:07:28,810 --> 00:07:31,460 Ejaaz: centers in the sense that they're going to be beaming lasers between each other 124 00:07:31,460 --> 00:07:35,490 Ejaaz: to form an interconnected grid that they can transfer data between each other. 125 00:07:35,490 --> 00:07:39,760 Ejaaz: And that is the sole mechanism that is required to train and inference models, 126 00:07:39,760 --> 00:07:41,570 Ejaaz: which is the entire point around SpaceX. 127 00:07:41,570 --> 00:07:44,660 Ejaaz: Now, it's important to understand when you're looking at the valuation, 128 00:07:44,660 --> 00:07:46,970 Ejaaz: when you're looking at the price, you might be thinking, well, 129 00:07:46,970 --> 00:07:49,430 Ejaaz: I don't know if this is overvalued. 130 00:07:49,430 --> 00:07:52,210 Ejaaz: It kind of seems like overvalued, even though I like what Elon is doing, 131 00:07:52,490 --> 00:07:56,610 Ejaaz: you have to understand that the whole premise is you're getting three companies 132 00:07:56,770 --> 00:08:00,730 Ejaaz: for one share. It's SpaceX, yes, to be the kind of like highway to space. 133 00:08:01,000 --> 00:08:04,220 Ejaaz: But then you have like the payloads, which is like all these GPUs that they're 134 00:08:04,220 --> 00:08:08,310 Ejaaz: going to be training on the sun's energy, becoming a Kardashev type one civilization, 135 00:08:08,310 --> 00:08:09,740 Ejaaz: which all sounds grand, but like 136 00:08:09,740 --> 00:08:12,110 Ejaaz: we now have the numbers and the mechanism to be able to pull that off. 137 00:08:12,390 --> 00:08:15,680 Ejaaz: And then you have the model itself under XAI. And then you have the distribution 138 00:08:15,680 --> 00:08:18,460 Ejaaz: through social media platform, through app stores and all that kind of stuff. 139 00:08:18,750 --> 00:08:23,630 Ejaaz: And it's not like Elon is depending primarily on his own companies to service 140 00:08:23,630 --> 00:08:25,340 Ejaaz: all this demand for Grok entirely. 141 00:08:25,610 --> 00:08:29,350 Ejaaz: He's signed major deals in the last, I think, three weeks with Anthropic, 142 00:08:29,530 --> 00:08:33,370 Ejaaz: Google, and Cursor, which equates to around $56 billion per year. 143 00:08:33,600 --> 00:08:38,310 Ejaaz: So the previous critics were like, I don't know if SpaceX is going to be profitable in general. 144 00:08:38,580 --> 00:08:41,590 Ejaaz: Now we have the answer, like all this money that's been coming from essentially 145 00:08:41,590 --> 00:08:46,250 Ejaaz: neocloud payments for Elon's existing colossus one two and three data centers 146 00:08:46,250 --> 00:08:49,290 Ejaaz: on earth is paying for itself it's paying for this entire expedition 147 00:08:49,760 --> 00:08:53,800 Josh: Oh it's an absolute monster of a company and now i want to talk about a second 148 00:08:53,800 --> 00:08:57,350 Josh: pillar because we've seen ai1 what that looks like what data centers in space 149 00:08:57,350 --> 00:08:59,660 Josh: look like we also have visual graphics of 150 00:08:59,900 --> 00:09:02,110 Josh: the new startling satellites and we've been talking about these new startling 151 00:09:02,110 --> 00:09:05,450 Josh: satellites for a long time now version two and most recently version three which 152 00:09:05,450 --> 00:09:07,760 Josh: is going up on starship and the 153 00:09:08,180 --> 00:09:12,270 Josh: stats and analytics between these two comparing them is pretty remarkable the 154 00:09:12,390 --> 00:09:18,270 Josh: the first generation of this, version 1.5 of Starlink, had 24 gigabits per second download, which, 155 00:09:18,830 --> 00:09:22,520 Josh: pretty small. If we look at version two of the satellites, which are what's 156 00:09:22,520 --> 00:09:24,630 Josh: available today, that's what's going up in the Falcon 9 rockets, 157 00:09:24,630 --> 00:09:29,320 Josh: the smaller ones, those have about 96 gigabytes per second, and they're able 158 00:09:29,320 --> 00:09:32,470 Josh: to deploy about 27 of those per launch. 159 00:09:32,780 --> 00:09:37,500 Josh: So that gives you about a total per launch of 2,600 gigabits per second. 160 00:09:37,760 --> 00:09:42,110 Josh: Now, when you look at version three satellites of Starlink, that's where the 161 00:09:42,110 --> 00:09:43,120 Josh: numbers get pretty silly. 162 00:09:43,350 --> 00:09:49,070 Josh: It's a 20 times multiple per launch on bandwidth relative to version two this 163 00:09:49,070 --> 00:09:51,350 Josh: is enabled with starship we talk about starship all the time. 164 00:09:51,990 --> 00:09:54,780 Josh: They've been doing really successful test runs they're going to continue that 165 00:09:54,780 --> 00:09:58,150 Josh: program once it starts becoming reusable they're going to put these satellites on it 166 00:09:58,470 --> 00:10:03,480 Josh: and it's going to deliver 61 000 gigabits per second to the internet that is 167 00:10:03,480 --> 00:10:08,200 Josh: 60 satellites that is a 20x multiple that is how you get to a true worldwide 168 00:10:08,200 --> 00:10:11,050 Josh: web that exists in space and when you think about what spacex is doing here 169 00:10:11,390 --> 00:10:15,490 Josh: they're creating a high bandwidth clone of the internet that exists here except 170 00:10:15,490 --> 00:10:17,600 Josh: in space What happens with the internet here? 171 00:10:17,870 --> 00:10:22,600 Josh: We actually run wires underground through the oceans to connect the world. 172 00:10:22,920 --> 00:10:26,450 Josh: If we have satellites, you remove a lot of the threat vectors, 173 00:10:26,450 --> 00:10:31,180 Josh: you remove a lot of the sensorability, you create this truly open and accessible 174 00:10:31,180 --> 00:10:33,750 Josh: network that's not only available to anyone with infrastructure, 175 00:10:33,750 --> 00:10:35,930 Josh: but available to anyone with access to the sky. 176 00:10:36,240 --> 00:10:41,010 Josh: And building that and making that available to everyone is such a remarkable 177 00:10:41,010 --> 00:10:44,130 Josh: business. And we've seen that reflected in the Starlink subscriber numbers. 178 00:10:44,380 --> 00:10:46,360 Josh: We have a chart here that shows the Starlink growth. 179 00:10:46,620 --> 00:10:50,960 Josh: And it has been the most perfect exponential chart I think I've probably ever 180 00:10:50,960 --> 00:10:54,300 Josh: seen in my life. And it is the Starlink subscriber growth. 181 00:10:54,570 --> 00:10:57,960 Josh: As of when is this? May 23rd. 182 00:10:58,220 --> 00:11:02,520 Josh: It is now sitting at 12 million users. And you could see they've been adding 183 00:11:02,710 --> 00:11:06,100 Josh: an exponential increment. I mean, the latest 2 million users were added only 184 00:11:06,100 --> 00:11:09,550 Josh: in the last 81 days. They're averaging 25,000 and climbing. 185 00:11:10,020 --> 00:11:13,890 Josh: So Elon and the Starlink team, they just recently revealed on an interview that 186 00:11:13,890 --> 00:11:17,430 Josh: they published a few days ago, the new version of these Starlink terminals, 187 00:11:17,640 --> 00:11:22,060 Josh: which are even smaller, even higher bandwidth, even more accessible in terms of price. 188 00:11:22,350 --> 00:11:25,470 Josh: And it's just this unbelievable service that it's going to be a no brainer not 189 00:11:25,470 --> 00:11:29,440 Josh: to have. If you ever require Internet anywhere that doesn't need fiber optics, 190 00:11:29,710 --> 00:11:32,210 Josh: you should be a Starlink subscriber. And that's what we're seeing in the growth. 191 00:11:32,210 --> 00:11:34,200 Josh: So it's really it's an unbelievable company. 192 00:11:34,390 --> 00:11:38,050 Josh: Starlink is one of those pillars that's just like it's it's crazy what they're 193 00:11:38,050 --> 00:11:40,040 Josh: doing and no one else can come close to this we 194 00:11:40,420 --> 00:11:43,580 Josh: we have blue origin which huge fan of i really hope they figure it out but their 195 00:11:43,580 --> 00:11:47,060 Josh: rocket just exploded on the launch pad last week and their whole program set 196 00:11:47,060 --> 00:11:48,450 Josh: back and they're the only ones that were close 197 00:11:48,780 --> 00:11:52,100 Josh: even if everything at blue origin worked as perfectly as they hoped for they're 198 00:11:52,100 --> 00:11:56,920 Josh: still five years behind at minimum probably 10 this is a full decade lead they 199 00:11:56,920 --> 00:11:59,990 Josh: have so there's essentially a monopoly on space that spacex owns 200 00:12:00,370 --> 00:12:04,440 Josh: and as it becomes more on demand to send mass to orbit, there's only one company 201 00:12:04,440 --> 00:12:06,450 Josh: that can do it. And they can do it damn well. 202 00:12:06,700 --> 00:12:10,680 Ejaaz: So this might be a crazy take, but Elon's superpower 203 00:12:11,190 --> 00:12:14,790 Ejaaz: actually it's not a crazy day this is obvious is scaling hardware from zero 204 00:12:14,790 --> 00:12:18,890 Ejaaz: to one better than anyone else on the entire world he's done it with electric 205 00:12:18,890 --> 00:12:22,530 Ejaaz: cars he's doing it with robots and now he's doing it with space rockets now 206 00:12:22,740 --> 00:12:25,750 Ejaaz: there's another advantage that he has which translates directly from that 207 00:12:26,270 --> 00:12:30,980 Ejaaz: Starlink right so you just mentioned that um you can repurpose starlink's production 208 00:12:30,980 --> 00:12:37,150 Ejaaz: lines to make this new ai1 satellites in fact arguably it's easier see with 209 00:12:37,150 --> 00:12:39,960 Ejaaz: when you're creating these SOLID-X satellites, they have this phased 210 00:12:40,400 --> 00:12:44,930 Ejaaz: Array antenna, which basically is meant to speak to the dishes that are on Earth 211 00:12:44,930 --> 00:12:47,930 Ejaaz: to communicate and beam this internet back down to Earth. 212 00:12:48,220 --> 00:12:51,970 Ejaaz: That is a really tricky thing to produce, but a satellite itself is fairly easy. 213 00:12:51,970 --> 00:12:55,500 Ejaaz: Now, with the AI-1 satellite, it doesn't need this phased array antenna. 214 00:12:55,500 --> 00:12:59,530 Ejaaz: In fact, you just need the laser projections to be able to communicate and talk 215 00:12:59,530 --> 00:13:01,710 Ejaaz: with each other. I mentioned it earlier, like transferring data, 216 00:13:01,930 --> 00:13:05,850 Ejaaz: training your model, inferencing the model, that is arguably easier to do. 217 00:13:05,850 --> 00:13:09,900 Ejaaz: And so Elon already is not starting from scratch here. Normally, he does zero to one. 218 00:13:10,040 --> 00:13:13,550 Ejaaz: He's kind of starting from 0.5 to one to be able to pull this off. 219 00:13:13,550 --> 00:13:18,410 Ejaaz: Now, in terms of timelines, I think he's aiming for the end of 2027 to have 220 00:13:18,410 --> 00:13:23,160 Ejaaz: a full gigawatt worth of these AI-1 satellites out in space. 221 00:13:23,160 --> 00:13:25,930 Ejaaz: So this is a very real thing. The timelines are, in my opinion, 222 00:13:26,170 --> 00:13:27,450 Ejaaz: much shorter than we think. 223 00:13:27,680 --> 00:13:31,370 Ejaaz: And he already has some of the world's leading AI labs committed, 224 00:13:31,590 --> 00:13:37,000 Ejaaz: at least in theory on paper and contractually, to pay and purchase access to 225 00:13:37,000 --> 00:13:41,400 Ejaaz: these things. Like you mentioned earlier, these AI-1 satellites are GPU interchangeable. 226 00:13:41,510 --> 00:13:44,850 Ejaaz: It's not just built for NVIDIA, although that's the primary kind of case right now. 227 00:13:45,090 --> 00:13:47,670 Ejaaz: You can fit TPUs, you can fit Amazon Tranium in the future. 228 00:13:47,920 --> 00:13:51,930 Ejaaz: He's meant to be the tall man, the transporter for all these GPUs to be put 229 00:13:51,930 --> 00:13:55,950 Ejaaz: out there to kind of absorb all of that sun's energy and train whatever model. 230 00:13:55,950 --> 00:13:58,930 Ejaaz: He's kind of like agnostic when it comes to that. And I think That is one of 231 00:13:58,930 --> 00:14:01,330 Ejaaz: the biggest bull cases for SpaceX as I see it today. 232 00:14:01,780 --> 00:14:04,360 Josh: Yeah, think about how difficult it has been to build a data center. 233 00:14:04,600 --> 00:14:08,550 Josh: You need the, what is it, land power shell in order to get a data center set up. 234 00:14:08,790 --> 00:14:13,280 Josh: And it is so remarkably difficult to get the approvals, to get the public sentiment 235 00:14:13,280 --> 00:14:15,830 Josh: to turn positive, to figure out where to source the energy from. 236 00:14:16,120 --> 00:14:19,490 Josh: It is this incredibly complicated process that's difficult and no one wants to deal with. 237 00:14:19,770 --> 00:14:23,890 Josh: And if you could just go over to Elon and say, yo, bro, I got a couple gigawatts 238 00:14:23,890 --> 00:14:26,280 Josh: that I need in orbit. Can you send them for me in the next few months? 239 00:14:26,540 --> 00:14:31,330 Josh: That is such an easy outcome and one that i think everyone will want to to use 240 00:14:31,330 --> 00:14:32,550 Josh: because why wouldn't you and 241 00:14:32,550 --> 00:14:35,750 Josh: i want to circle back to the ipo and why i said earlier in the show that 242 00:14:36,130 --> 00:14:39,330 Josh: a spacex should be the most valuable company in the world we we barely even 243 00:14:39,330 --> 00:14:42,930 Josh: talked about xai and we barely even talked about the other entities that exist 244 00:14:42,930 --> 00:14:47,880 Josh: underneath it but the idea is that as as ai continues to expand and continues to take up 245 00:14:48,160 --> 00:14:51,570 Josh: more of what we do on a day-to-day basis it's very much accelerating in that 246 00:14:51,570 --> 00:14:52,760 Josh: world of bits that we talk about 247 00:14:52,760 --> 00:14:56,470 Josh: a lot it's able to do ones and zeros very effectively and very efficiently 248 00:14:56,850 --> 00:15:00,520 Josh: the difficult thing now the bottleneck shifts to the physical world this world 249 00:15:00,520 --> 00:15:05,020 Josh: of atoms where you have to actually build things you have to create the physical manifestation of. 250 00:15:05,490 --> 00:15:10,090 Josh: This ai to to allow it to be embodied or to give it enough energy and resources 251 00:15:10,090 --> 00:15:13,680 Josh: to train itself to become this agi the super intelligence and when it comes 252 00:15:13,680 --> 00:15:16,210 Josh: to manufacturing when it comes to real world engineering 253 00:15:16,530 --> 00:15:20,380 Josh: there is really no better team in the world than spacex in terms of hardware 254 00:15:20,380 --> 00:15:23,080 Josh: engineering and when i look at other engineering teams who are really good at 255 00:15:23,080 --> 00:15:27,010 Josh: creating physical objects in the real world manufacturing factories which are 256 00:15:27,010 --> 00:15:30,070 Josh: actually the product and the factories produce these goods and services but 257 00:15:30,070 --> 00:15:31,320 Josh: building the factory is the hard part 258 00:15:31,720 --> 00:15:35,890 Josh: i also look at tesla and tesla has done a remarkable job at building and manufacturing 259 00:15:35,890 --> 00:15:40,250 Josh: these objects at scale and what is tesla now working on they cut down their model s and their x line. 260 00:15:40,890 --> 00:15:45,110 Josh: In exchange for Optimus, the humanoid robot, that humanoid robot is going to scale very quickly. 261 00:15:45,400 --> 00:15:49,210 Josh: That humanoid robot paired with Grok and XAI as the orchestrator is going to 262 00:15:49,210 --> 00:15:53,040 Josh: build this like very autonomous capability of actually physically manufacturing 263 00:15:53,040 --> 00:15:53,770 Josh: things in the real world. 264 00:15:54,050 --> 00:15:56,690 Josh: SpaceX and Tesla are probably going to merge together. 265 00:15:57,250 --> 00:16:00,330 Josh: In the case that those two companies come together, there is no instance in 266 00:16:00,330 --> 00:16:04,730 Josh: which they do not become the most valuable company in the world so long as they deliver on the promise. 267 00:16:05,120 --> 00:16:07,420 Josh: And I think the way you look at these companies, the way you validate these 268 00:16:07,420 --> 00:16:09,930 Josh: companies is you kind of like look at the roadmap and you say, 269 00:16:09,930 --> 00:16:13,730 Josh: are the products and services that they offer in the future going to be significantly 270 00:16:13,730 --> 00:16:14,890 Josh: better than they are today? 271 00:16:14,890 --> 00:16:18,130 Josh: And if the answer is yes, then the idea is that the company should be significantly 272 00:16:18,130 --> 00:16:21,520 Josh: more valuable to match the added value that they're going to increase. 273 00:16:22,160 --> 00:16:25,920 Josh: I very strongly feel that way. We have Starship. We have Optimus, the humanoid robots. 274 00:16:25,920 --> 00:16:29,970 Josh: If just those two things work and nothing else works, the amount of value that 275 00:16:29,970 --> 00:16:34,060 Josh: will be unlocked is unimaginable. It's really hard to fathom how large these 276 00:16:34,060 --> 00:16:37,870 Josh: companies can get. And we have this perceived limit of what a market cap of a company can be. 277 00:16:38,350 --> 00:16:41,990 Josh: NVIDIA is close to $6 trillion or something. But to imagine a company reaching 278 00:16:41,990 --> 00:16:45,760 Josh: $10, $20 trillion, $30 trillion doesn't seem unreasonable when you think about 279 00:16:45,760 --> 00:16:50,860 Josh: the scope and scale of a company like Tesla, of a company like SpaceX merged 280 00:16:50,860 --> 00:16:53,170 Josh: together under the rule of Elon Musk. 281 00:16:53,170 --> 00:16:56,440 Josh: It's just this unbelievable opportunity that finally the public has access to. 282 00:16:56,440 --> 00:16:59,910 Josh: And that's why I am particularly excited to invest in the SpaceX IPO. 283 00:17:00,730 --> 00:17:06,390 Ejaaz: I think for the longest time, the SpaceX IPO has been based on a lot of visionary 284 00:17:06,850 --> 00:17:11,330 Ejaaz: ideas, kind of belief and this undying faith in Elon. 285 00:17:11,330 --> 00:17:16,080 Ejaaz: But I do want to touch more on like what the potential numbers might look like 286 00:17:16,080 --> 00:17:19,170 Ejaaz: to make that multi-trillion dollar valuation that you're talking about, 287 00:17:19,170 --> 00:17:20,730 Ejaaz: Josh, an actual reality. 288 00:17:20,730 --> 00:17:23,820 Ejaaz: So there's two kind of perspectives I want to share here. 289 00:17:23,820 --> 00:17:26,720 Ejaaz: So number one, Hamid over here 290 00:17:26,720 --> 00:17:30,120 Ejaaz: shared his breakdown of what each of these satellites basically equate to. 291 00:17:30,120 --> 00:17:34,220 Ejaaz: So if you launch one of these AI-1 satellites out into space right now, 292 00:17:34,220 --> 00:17:39,670 Ejaaz: today, it's the equivalent of basically half a rack of GPUs that you currently 293 00:17:39,670 --> 00:17:45,120 Ejaaz: find in a data center here on Earth. So it's around 120 to 150 kilowatts, it's around half a rack. 294 00:17:45,350 --> 00:17:50,140 Ejaaz: Now, today's data centers, let's say it's worth like one gigawatts worth of compute. 295 00:17:50,400 --> 00:17:54,080 Ejaaz: That's the equivalent of 4,000 racks at around 250 kilowatts. 296 00:17:54,080 --> 00:17:59,620 Ejaaz: So you would need to launch 8,000 of these AI-1 satellites into space to be 297 00:17:59,620 --> 00:18:03,510 Ejaaz: able to equate to one data center, one gigawatts worth of compute. 298 00:18:03,510 --> 00:18:08,150 Ejaaz: And Elon is targeting that by the end of 2027, which is a lot sooner than most... 299 00:18:09,300 --> 00:18:13,240 Ejaaz: People would have expected. Now, there's a lot of costs that go in this. 300 00:18:13,240 --> 00:18:17,380 Ejaaz: The average launch costs, actually, you know, if you're being kind of like medium 301 00:18:17,380 --> 00:18:21,170 Ejaaz: to kind of like conservative is around $10 billion just for like the launch 302 00:18:21,170 --> 00:18:22,390 Ejaaz: costs and not the materials at all. 303 00:18:22,390 --> 00:18:26,570 Ejaaz: Now, Elon's whole idea is that he's going to bring these launch costs down pretty 304 00:18:26,570 --> 00:18:28,270 Ejaaz: dramatically over the next three years. 305 00:18:28,610 --> 00:18:33,330 Ejaaz: And at three years in, he's saying that it'll be more cost effective than building 306 00:18:33,330 --> 00:18:35,400 Ejaaz: a data center here on Earth. 307 00:18:35,650 --> 00:18:39,150 Ejaaz: And so if we do napkin math with that in mind, right, three years from now, 308 00:18:39,150 --> 00:18:42,630 Ejaaz: or maybe less than three years from now, a Vera Rubin rack right now, 309 00:18:42,630 --> 00:18:46,240 Ejaaz: which is like NVIDIA's latest GPUs that they're rolling out, 310 00:18:46,600 --> 00:18:47,920 Ejaaz: is worth around $8 million. 311 00:18:48,630 --> 00:18:53,100 Ejaaz: Now, if you couple that with the launch costs at around 200k launch cost per 312 00:18:53,100 --> 00:18:57,380 Ejaaz: rocket, which is what Elon's aiming for, we are going to hit at around $10 million 313 00:18:57,380 --> 00:19:00,020 Ejaaz: to put a single Vera Rubin rack out in space. 314 00:19:00,020 --> 00:19:03,860 Ejaaz: So $12 million on the ground, $10 million in space. 315 00:19:04,220 --> 00:19:07,660 Ejaaz: You can see a world where the cost economics end up becoming favorable, 316 00:19:07,660 --> 00:19:11,140 Ejaaz: especially if you're not just using Vero Rubin racks, you might be using cheaper 317 00:19:11,140 --> 00:19:13,840 Ejaaz: Google TPU racks or Amazon Tranium. 318 00:19:13,840 --> 00:19:17,910 Ejaaz: So the idea is this is a big bet. Now, if you're purchasing this IPO, 319 00:19:17,910 --> 00:19:21,450 Ejaaz: you aren't just in it for the near term, you're in it for this next three to 320 00:19:21,730 --> 00:19:23,660 Ejaaz: honestly 10 year window, where 321 00:19:23,660 --> 00:19:27,400 Ejaaz: AI data centers in space become a much real thing, much more real thing. 322 00:19:27,780 --> 00:19:29,940 Josh: Yeah, and this is a roundup. So we're going to wrap this up in a second, 323 00:19:29,940 --> 00:19:32,670 Josh: get some more news. But the final point that I want to make is you mentioned 324 00:19:32,670 --> 00:19:34,940 Josh: the cost of reusability for Starship. 325 00:19:35,260 --> 00:19:38,750 Josh: If you look at the Falcon 9 rocket, there's two stages, and only one of them 326 00:19:38,750 --> 00:19:41,010 Josh: is actually reusable, so there still is a higher cost. 327 00:19:41,270 --> 00:19:45,370 Josh: With Starship, 100% of the rocket is reusable, and the actual cost to launch 328 00:19:45,370 --> 00:19:48,480 Josh: it in the case that 100% is reusable is just the cost of fuel. 329 00:19:48,830 --> 00:19:52,520 Josh: And the cost of fuel on a Starship rocket is actually cheaper than the cost 330 00:19:52,520 --> 00:19:55,650 Josh: of fuel on something like a Boeing 747. Because... 331 00:19:56,110 --> 00:20:00,690 Josh: 78% of it, I think, like almost 80% is just liquid oxygen. Liquid oxygen is 332 00:20:00,690 --> 00:20:02,610 Josh: like very abundant. We breathe it all the time. 333 00:20:02,840 --> 00:20:08,370 Josh: It is just a liquefied form of oxygen with the remaining 22% being just liquid methane. 334 00:20:08,730 --> 00:20:11,240 Josh: And methane is like, it's the stuff you like cook on your grill with. 335 00:20:11,480 --> 00:20:16,000 Josh: So this isn't very expensive. It's not crazy to think that they will need a 336 00:20:16,000 --> 00:20:18,450 Josh: lot of money to launch these things. And the idea is that that will bring the 337 00:20:18,450 --> 00:20:20,360 Josh: cost per kilogram down to sub $100. 338 00:20:20,640 --> 00:20:23,530 Josh: And that means if you are, it does, if you want to go to space, 339 00:20:23,830 --> 00:20:26,770 Josh: depending on how many kilograms you are, you just divide that by 100 and you're on your way. 340 00:20:27,060 --> 00:20:29,640 Ejaaz: It's a cheap ticket weight so i'm meant to lose some weight now 341 00:20:31,310 --> 00:20:35,020 Josh: So yeah go on a diet so you can get a cheaper ticket to space but that's i think 342 00:20:35,020 --> 00:20:37,820 Josh: that's kind of like the bulkiest why i'm excited i have to ask you as we wrap 343 00:20:37,820 --> 00:20:39,230 Josh: up this section before we get into the next one 344 00:20:39,470 --> 00:20:43,090 Josh: which is going to be open ai building this like gigantic data center is are 345 00:20:43,090 --> 00:20:46,340 Josh: you going to be participating in the spacex ipo are you excited about it are 346 00:20:46,340 --> 00:20:48,550 Josh: you going to buy some what are your general thoughts. 347 00:20:48,880 --> 00:20:52,440 Ejaaz: So if robin hood and my broker allows me to which i've signaled interest. 348 00:20:52,880 --> 00:20:55,540 Ejaaz: Absolutely, I will be as this goes live today. 349 00:20:56,460 --> 00:21:02,250 Ejaaz: My thoughts in general are I wouldn't bet against Elon when it comes to hardware 350 00:21:02,250 --> 00:21:04,960 Ejaaz: scaling. He's less proven on the software side of things. 351 00:21:05,640 --> 00:21:08,950 Ejaaz: This is just me trying to be balanced here, but he has proven himself time and 352 00:21:08,950 --> 00:21:10,120 Ejaaz: again on hardware scaling. 353 00:21:10,410 --> 00:21:15,030 Ejaaz: And SpaceX is solving a hardware issue, one of the biggest hardware issues or 354 00:21:15,030 --> 00:21:17,650 Ejaaz: challenges ever with AI data centers in space. 355 00:21:18,110 --> 00:21:21,100 Ejaaz: As everyone knows, I'm a big AI fan. So if he's able to pull this off. 356 00:21:21,300 --> 00:21:23,780 Ejaaz: More compute equals better models, better inference. 357 00:21:24,340 --> 00:21:27,990 Ejaaz: He'll be able to serve agnostically any AI company. It's an obvious buy for me. 358 00:21:28,700 --> 00:21:32,260 Josh: Yeah, I think I'm pretty aligned. Me too. I have been so I got lucky in the 359 00:21:32,260 --> 00:21:34,550 Josh: case that I had some private shares from about five years ago. 360 00:21:34,550 --> 00:21:38,170 Josh: So I have been a SpaceX holder. I continue. I plan to continue that going forward. 361 00:21:38,410 --> 00:21:39,800 Josh: I also requested some at IPO. 362 00:21:40,070 --> 00:21:43,350 Josh: I'm also just planning to continue to buy like, dude, I can get a 10 plus trillion 363 00:21:43,350 --> 00:21:44,700 Josh: dollar company for 2 trillion bucks. 364 00:21:45,010 --> 00:21:47,930 Josh: Sign me up. I think the people who are a little more time sensitive, 365 00:21:48,150 --> 00:21:51,190 Josh: who are looking to get a return sooner, that might be a bit iffy. 366 00:21:51,330 --> 00:21:55,200 Josh: I mean, $2.1 trillion is high. There's still a lot of variables that need to be worked out. 367 00:21:55,490 --> 00:21:59,170 Josh: There's a chance that this thing goes public, shoots up, and then falls for a little while. 368 00:21:59,570 --> 00:22:02,440 Josh: I don't know. We're not traders. But I think as long-term investors, 369 00:22:03,010 --> 00:22:07,320 Josh: as someone with a low time preference, SpaceX at $2 trillion, two thumbs up for me. 370 00:22:07,720 --> 00:22:10,230 Josh: Let's keep the train going. Anyways, we probably should move on. 371 00:22:10,230 --> 00:22:13,430 Josh: This is a roundup. This is Friday. We got to fill the people in on what's going on. 372 00:22:13,630 --> 00:22:18,500 Josh: EJ, there's some news from OpenAI about a new gigawatt data center. 373 00:22:18,940 --> 00:22:22,120 Josh: We're back on Earth, by the way. We're talking about data centers on Earth. 374 00:22:22,310 --> 00:22:23,870 Josh: What's the deal with this new OpenAI news? 375 00:22:24,320 --> 00:22:29,370 Ejaaz: Yeah, so we're out of the world of single-digit gigawatts now, 376 00:22:29,370 --> 00:22:31,230 Ejaaz: Josh. We're in double digits. 377 00:22:31,230 --> 00:22:32,550 Josh: Run it up expeditiously. 378 00:22:32,550 --> 00:22:38,530 Ejaaz: OpenAI has basically signed a major deal for a 10-gigawatt data center. 379 00:22:38,530 --> 00:22:43,010 Ejaaz: For context here, the largest gigawatt data center, which is what Elon's building 380 00:22:43,010 --> 00:22:48,100 Ejaaz: with Colossus 3, is aiming to be around 1.5 to 2 gigawatts worth of data centers. 381 00:22:48,860 --> 00:22:56,100 Ejaaz: For a single site to own 10 gigawatts of compute, you need roughly around $500 billion. 382 00:22:56,620 --> 00:23:00,710 Ejaaz: Now, obviously, OpenAI, they haven't IPO'd yet. They might be pretty soon. 383 00:23:01,490 --> 00:23:04,690 Ejaaz: They don't have that kind of money. So they're being backstopped by their best 384 00:23:04,690 --> 00:23:07,720 Ejaaz: friend, SoftBank, and of course, NVIDIA. 385 00:23:07,870 --> 00:23:12,770 Ejaaz: Jensen Huang is stepping up to backstop this entire data center campus in Ohio. 386 00:23:12,770 --> 00:23:16,180 Ejaaz: It's going to be an absolute gargantuan beast of a site. 387 00:23:16,420 --> 00:23:18,820 Ejaaz: And it kind of follows in the trend of 388 00:23:19,250 --> 00:23:23,240 Ejaaz: Sam Altman and OpenAI specifically, who have been incredibly aggressive about 389 00:23:23,240 --> 00:23:27,360 Ejaaz: acquiring as much compute as they can to serve their models. 390 00:23:27,360 --> 00:23:30,290 Ejaaz: Now, if you compare them to Anthropic, you might notice sometimes when you're 391 00:23:30,290 --> 00:23:32,770 Ejaaz: using clawed models, the performance gets a little degraded, 392 00:23:32,770 --> 00:23:35,550 Ejaaz: or you might get limited, or you might hit your limits really quickly. 393 00:23:35,660 --> 00:23:39,070 Ejaaz: That's because Anthropic has fairly been conservative with compute, 394 00:23:39,070 --> 00:23:40,870 Ejaaz: and that's given them advantages in other areas. 395 00:23:41,100 --> 00:23:44,480 Ejaaz: OpenAI has been the opposite, and that's why it's always kind of like relatively 396 00:23:44,480 --> 00:23:48,270 Ejaaz: free and flexible to use as much of your rate limit at OpenAI as you can, 397 00:23:48,270 --> 00:23:51,940 Ejaaz: which has led to arguably a better developer experience, a better coding experience, 398 00:23:51,940 --> 00:23:53,490 Ejaaz: a better LLM experience in general. 399 00:23:53,700 --> 00:23:56,800 Ejaaz: And Sam is doubling down on that bet. He believes in the future, 400 00:23:57,010 --> 00:24:00,910 Ejaaz: the demand for AI is going to outstrip the amount of available compute supply 401 00:24:00,910 --> 00:24:02,280 Ejaaz: that he has currently on Earth. 402 00:24:02,600 --> 00:24:05,140 Ejaaz: He is kind of not on good terms of the alarm, you could say. 403 00:24:05,140 --> 00:24:06,680 Ejaaz: They recently just got out of a court case. 404 00:24:06,920 --> 00:24:10,140 Ejaaz: So he's probably not going to be using data centers in space anytime soon. 405 00:24:10,310 --> 00:24:14,140 Ejaaz: So he's trying to secure as much ground space as he can on this new site. 406 00:24:14,140 --> 00:24:19,190 Ejaaz: Now, what worries me a little about this is just the pure amount of money that 407 00:24:19,190 --> 00:24:21,060 Ejaaz: you need. Now, obviously, this is going to be done in phases. 408 00:24:21,060 --> 00:24:24,310 Ejaaz: 10 gigawatts of computers is going to take absolute years to spin up. 409 00:24:24,550 --> 00:24:28,700 Ejaaz: But it's an important bit of news that I think kind of lays into this next headline. 410 00:24:28,990 --> 00:24:32,960 Ejaaz: Josh, I don't know if you saw this, but OpenAI has confidentially filed for 411 00:24:32,960 --> 00:24:36,050 Ejaaz: an S1. They are going to be IPO-ing relatively soon. 412 00:24:36,370 --> 00:24:41,270 Josh: OpenAI is copying SpaceX with data centers. They're copying SpaceX with IPOs. 413 00:24:41,270 --> 00:24:43,620 Josh: It doesn't work with Elon. All right, I'm getting the trend. 414 00:24:43,760 --> 00:24:45,790 Josh: Yeah, but it seems like this is actually official now. 415 00:24:46,230 --> 00:24:48,020 Josh: I hope they can build that data center. That would be amazing. 416 00:24:48,020 --> 00:24:51,290 Josh: But we do have a official filing of a confidential S1. 417 00:24:51,560 --> 00:24:56,610 Josh: And there was also a leaked all hands news report that I read that said Sam 418 00:24:56,610 --> 00:24:58,150 Josh: is kind of using this as an option. 419 00:24:58,520 --> 00:25:02,980 Josh: There is the option to go public soon. But depending on how their model progress 420 00:25:02,980 --> 00:25:05,620 Josh: goes over the next few months, they will then make that determination. 421 00:25:05,620 --> 00:25:08,750 Josh: His perspective is that the world will meaningfully change in the sense that 422 00:25:08,750 --> 00:25:12,980 Josh: they do get kind of like this runaway AGI self-fulfilling loop type thing. 423 00:25:13,330 --> 00:25:16,350 Josh: And he wants to be a private company in the case that that does happen sooner 424 00:25:16,600 --> 00:25:19,020 Josh: rather than later. This is some pretty... 425 00:25:19,960 --> 00:25:23,550 Josh: Big grand visions that they're dealing with so we'll see but now they do have 426 00:25:23,550 --> 00:25:26,670 Josh: the option they have confidentially filed someone out there is reading through 427 00:25:26,670 --> 00:25:29,800 Josh: this and probably having a field day understand the internals of how this company 428 00:25:29,800 --> 00:25:31,970 Josh: actually works so that's pretty exciting news. 429 00:25:32,140 --> 00:25:35,920 Ejaaz: Yeah and there was another bit of news that uh open ai reportedly is looking 430 00:25:35,920 --> 00:25:41,340 Ejaaz: to slash the cost or prices to their subscriptions which is kind of a change 431 00:25:41,340 --> 00:25:43,310 Ejaaz: in the directional trend that we've seen from anthropic um 432 00:25:43,990 --> 00:25:47,970 Ejaaz: google actually this week cut their prices as well i think we're starting to see, 433 00:25:48,550 --> 00:25:51,930 Ejaaz: we're starting to reach a point where all these AI models, as good as they are, 434 00:25:51,930 --> 00:25:53,830 Ejaaz: are starting to become more commoditized. 435 00:25:53,830 --> 00:25:57,260 Ejaaz: They kind of all do the same things. The leap between the prior version and 436 00:25:57,260 --> 00:26:01,180 Ejaaz: the current version isn't as large as it used to be, like, say, a year back. 437 00:26:01,410 --> 00:26:04,970 Ejaaz: And OpenAI is taking the first step to being competitive towards Anthropic and 438 00:26:05,650 --> 00:26:10,520 Ejaaz: Google. So Google slashed their access to their AI studio to about $20 a month 439 00:26:10,520 --> 00:26:13,110 Ejaaz: for their cheapest thing. I think OpenAI is planning to do the same. 440 00:26:13,110 --> 00:26:16,400 Ejaaz: And I'm guessing, like, Anthropic and OpenAI are going to get into some kind of a bidding war. 441 00:26:16,560 --> 00:26:20,380 Ejaaz: OpenAI kind of like taking its time to go public, as Sam suggested in that leaked 442 00:26:20,380 --> 00:26:24,090 Ejaaz: memo, is very interesting to me because you see Anthropik and SpaceX kind of 443 00:26:24,090 --> 00:26:26,050 Ejaaz: like racing to raise as much capital as they can. 444 00:26:26,200 --> 00:26:29,840 Ejaaz: And if Sam wants to pay for a $500 billion data center, he kind of like, 445 00:26:29,840 --> 00:26:32,210 Ejaaz: I'm confused where he's going to get the money from. Maybe he's just going to 446 00:26:32,210 --> 00:26:33,180 Ejaaz: keep borrowing privately. 447 00:26:33,570 --> 00:26:38,000 Ejaaz: But it's just a unique case where OpenAI is kind of breaking away from the pact. 448 00:26:38,000 --> 00:26:40,940 Ejaaz: And I'm wondering if these financial decisions actually end up paying off. 449 00:26:41,350 --> 00:26:45,690 Josh: Yeah, we'll see. We got to cover Fable next because it just released this week. 450 00:26:45,980 --> 00:26:48,640 Josh: You've been using it for a few days. I've been using it for a little while. 451 00:26:48,990 --> 00:26:53,840 Josh: It's a pretty amazing model. I've been using it for a lot of fun extracurricular 452 00:26:53,840 --> 00:26:56,870 Josh: stuff I found. Like I created the Minecraft clone to play around with it. 453 00:26:57,040 --> 00:27:00,610 Josh: I've been building kind of games in 3D spaces and I found it to be really fun. 454 00:27:00,610 --> 00:27:04,520 Josh: It genuinely feels like this novel model architecture that I've been enjoying 455 00:27:04,520 --> 00:27:07,140 Josh: playing with. Ejaz, over the first few days that you've been using this, 456 00:27:07,350 --> 00:27:11,640 Josh: what are your initial thoughts, opinions, kind of like after the dust settles, how do you feel about, 457 00:27:12,250 --> 00:27:13,430 Josh: the new model fable 5. 458 00:27:14,010 --> 00:27:19,160 Ejaaz: Um i think it is less sycophantic than opus 4.8 i'm not gonna lie i 459 00:27:19,530 --> 00:27:26,250 Ejaaz: when 4.8 came out i use it primarily as my main model but like it was way more agreeable than 4.7 460 00:27:26,560 --> 00:27:30,770 Ejaaz: we're now back with fable 5 and that might sound like it's got nothing to do 461 00:27:30,770 --> 00:27:34,730 Ejaaz: with intelligence to me it is it factors in the personality of the model and 462 00:27:34,730 --> 00:27:39,600 Ejaaz: i'm able to like work with it longer over certain tasks it just understands what i want to do 463 00:27:39,930 --> 00:27:42,980 Ejaaz: the second thing i've noticed is i've been working on a couple of personal projects 464 00:27:42,980 --> 00:27:45,080 Ejaaz: that involve a lot of code and research. 465 00:27:46,000 --> 00:27:53,270 Ejaaz: I can just one-prompt Fable 5, and it is able to just work continuously for up to an hour. 466 00:27:53,270 --> 00:27:56,460 Ejaaz: Now, I know software engineers listening to this are like, I let my thing run 467 00:27:56,460 --> 00:27:58,890 Ejaaz: for five to six hours or maybe even overnight. 468 00:27:58,890 --> 00:28:04,170 Ejaaz: But for me, for the average person, it is becoming incrementally more valuable 469 00:28:04,170 --> 00:28:07,940 Ejaaz: for a model that understands what you want, that doesn't come to you for every 470 00:28:07,940 --> 00:28:11,480 Ejaaz: kind of challenge it hits, and just kind of figures it out for himself. 471 00:28:11,480 --> 00:28:16,220 Ejaaz: And I think this kind of trend of models doing longer horizon tasks way better than the average human 472 00:28:16,500 --> 00:28:20,820 Ejaaz: is a subtle trend that is going to be increasingly valuable for corporate workers 473 00:28:20,820 --> 00:28:23,650 Ejaaz: at enterprises, as well as personal people that are like starting their own 474 00:28:23,650 --> 00:28:27,200 Ejaaz: businesses or want to spin up multiple of these agents instead of hiring an employee. 475 00:28:27,410 --> 00:28:30,960 Ejaaz: I just think it's a wonderfully intelligent model. And I'm excited to see further 476 00:28:30,960 --> 00:28:35,530 Ejaaz: iterations of this mythos grade kind of type of model be released. 477 00:28:35,530 --> 00:28:39,690 Ejaaz: But there was some pushback, right, Josh, like there were some policies that 478 00:28:39,690 --> 00:28:43,060 Ejaaz: came out that were basically like, hey, like, You get access to this public 479 00:28:43,060 --> 00:28:46,540 Ejaaz: version of Mythos 5, but it's going to be heavily safeguarded. 480 00:28:46,540 --> 00:28:50,720 Ejaaz: Now, one of the biggest criticisms that they faced was if you ask it questions 481 00:28:50,720 --> 00:28:54,690 Ejaaz: like, hey, I'm trying to train my agent to become more efficient and use less 482 00:28:54,690 --> 00:28:58,570 Ejaaz: tokens, it'll take that as some kind of an inclination that you're trying to 483 00:28:58,570 --> 00:29:00,540 Ejaaz: learn how Claude Fable 5 is built. 484 00:29:00,860 --> 00:29:06,590 Ejaaz: And Anthropic installs these anti-distillation maneuvers, basically rediverting 485 00:29:06,590 --> 00:29:08,570 Ejaaz: you back to the old model, Opus 4.8. 486 00:29:08,930 --> 00:29:13,070 Ejaaz: But in this case, it would give you degraded quality intentionally because it 487 00:29:13,070 --> 00:29:15,530 Ejaaz: thinks you're trying to like steal its blueprints. 488 00:29:15,880 --> 00:29:18,780 Ejaaz: Anthropik has now walked that back because previously they weren't going to 489 00:29:18,780 --> 00:29:19,690 Ejaaz: tell you when they were going to do it. 490 00:29:19,930 --> 00:29:23,030 Ejaaz: And now they are telling you. They reversed that decision as of yesterday, 491 00:29:23,260 --> 00:29:26,740 Ejaaz: basically saying, hey, we'll be up front with you when we're going to intentionally 492 00:29:26,740 --> 00:29:30,410 Ejaaz: degrade the quality of your answer because we think you're trying to like copy 493 00:29:30,410 --> 00:29:33,010 Ejaaz: our model weights, which is a very political maneuver. 494 00:29:33,010 --> 00:29:35,620 Ejaaz: And it's nice to see that they backtracked on that. 495 00:29:36,020 --> 00:29:39,680 Josh: There you have it. So there's the update on Fable and the final topic of the week. 496 00:29:39,680 --> 00:29:43,460 Josh: We filmed an entire episode about Fable and also this final topic, WWDC. 497 00:29:43,460 --> 00:29:46,200 Josh: So if you have not watched either of those, I highly recommend going to check 498 00:29:46,200 --> 00:29:49,370 Josh: them out. Pretty amazing episodes. We had a really strong week of fun topics 499 00:29:49,370 --> 00:29:53,010 Josh: to talk about this week, but I do want to trace over WWDC, particularly around 500 00:29:53,010 --> 00:29:56,860 Josh: Siri AI, which seems to actually be as good as they said it would be. 501 00:29:57,280 --> 00:30:01,460 Josh: And we have to cover this because that comes as a surprise. This is not the Apple of the past. 502 00:30:01,460 --> 00:30:04,770 Josh: This is the Apple that promises things and doesn't always deliver so the people 503 00:30:04,770 --> 00:30:08,320 Josh: have had to download the beta actually fact check try it for themselves and 504 00:30:08,320 --> 00:30:10,520 Josh: the initial reviews have been spectacular 505 00:30:10,830 --> 00:30:14,440 Josh: it seems like it actually works better than what they demoed in real time on 506 00:30:14,440 --> 00:30:17,890 Josh: stage it actually works faster it understands context it works very well on 507 00:30:17,890 --> 00:30:21,460 Josh: people's phones and this is available through the developer program that apple 508 00:30:21,460 --> 00:30:23,720 Josh: offers through their ios developer membership 509 00:30:24,030 --> 00:30:27,750 Josh: it seems like we're actually going to have a pretty powerful siri experience 510 00:30:27,750 --> 00:30:30,410 Josh: we're going to have on-device ai that is actually. 511 00:30:31,100 --> 00:30:34,070 Josh: Contextually aware of everything that lives on your phone and off of it. 512 00:30:34,440 --> 00:30:37,110 Josh: And they actually addressed something that I found really interesting. 513 00:30:37,110 --> 00:30:42,040 Josh: Maybe you saw, maybe you didn't about their removal of Siri from Europe and 514 00:30:42,040 --> 00:30:45,790 Josh: from China in the sense that they will not budge on the privacy thing. 515 00:30:45,790 --> 00:30:48,870 Josh: They will offload some of the compute to cloud in the sense that, 516 00:30:49,190 --> 00:30:53,290 Josh: or in the case that it can't run locally on your device, it's a little too challenging for that. 517 00:30:53,520 --> 00:30:55,730 Josh: And when they do, it's done so entirely privately. 518 00:30:56,010 --> 00:30:58,600 Josh: Europe doesn't want this to happen. So therefore Apple's like, 519 00:30:58,850 --> 00:31:01,380 Josh: no, no, no, we're not giving you the backdoor. We don't even have the backdoor. 520 00:31:01,770 --> 00:31:05,120 Josh: We are just not going to push it there. And I really admire the like standing 521 00:31:05,120 --> 00:31:08,200 Josh: strong on the stance of being private of running everything on device. 522 00:31:08,410 --> 00:31:12,220 Josh: It seems like Apple has a grand slam and it comes maybe a couple of years later 523 00:31:12,220 --> 00:31:13,000 Josh: than everyone would like. 524 00:31:13,240 --> 00:31:16,620 Josh: But this is something I am stoked to get. And I think the downstream implications 525 00:31:16,620 --> 00:31:18,210 Josh: of this are probably pretty big. 526 00:31:18,210 --> 00:31:22,350 Josh: There's a lot of casual users of something like ChatGPT who pay $20 a month 527 00:31:22,350 --> 00:31:27,000 Josh: to have an LLM that they basically use as Google Plus Plus, this now substitutes 528 00:31:27,000 --> 00:31:29,410 Josh: and subsidizes a lot of that all for free, 529 00:31:30,070 --> 00:31:33,720 Josh: running local inference on device. So very excited, very bullish about Apple in general. 530 00:31:34,160 --> 00:31:38,960 Ejaaz: You know, it was funny. I was reading the release article for Siri AI, 531 00:31:38,960 --> 00:31:43,390 Ejaaz: and typically at the footnote, you'll see, you know, these regions are excluded. 532 00:31:43,390 --> 00:31:46,430 Ejaaz: It'll just be a minor bullet point in tiny, you know, writing. 533 00:31:46,790 --> 00:31:52,010 Ejaaz: For Europe, they had an entire A4 page basically saying this is Europe's fault. 534 00:31:52,540 --> 00:31:56,830 Ejaaz: Europe government is the reason that we can't release our product, 535 00:31:56,830 --> 00:32:00,320 Ejaaz: and we are not budging because we just think, frankly, that this is ridiculous. 536 00:32:01,150 --> 00:32:05,280 Ejaaz: It was a larger piece than the China bit, which just came in as like a paragraph. 537 00:32:05,280 --> 00:32:07,200 Ejaaz: Obviously, China is like going to want access. 538 00:32:07,200 --> 00:32:08,750 Josh: I think everyone expects the China one. 539 00:32:09,010 --> 00:32:14,900 Ejaaz: Exactly. But for Europe, they've been sort of anti-AI and anti-privacy for quite a while now. 540 00:32:14,900 --> 00:32:20,590 Ejaaz: And it has resulted in slowed down releases of the latest AI products and features 541 00:32:20,770 --> 00:32:23,260 Ejaaz: in that region, which is just kind of like sad to see, especially like, 542 00:32:23,390 --> 00:32:24,340 Ejaaz: you know, that's where I'm from. 543 00:32:24,340 --> 00:32:27,320 Ejaaz: And it's annoying that like, I can't talk to my friends about the latest features 544 00:32:27,320 --> 00:32:30,710 Ejaaz: because they have to wait like months to a year to get access to the exact same thing. 545 00:32:30,940 --> 00:32:34,190 Ejaaz: That being said, a lot of the haters for Apple, which included me, 546 00:32:34,190 --> 00:32:37,970 Ejaaz: which was me a year ago, was like, I don't think Apple's gonna be able to catch up. 547 00:32:38,330 --> 00:32:42,600 Ejaaz: We have been proven absolutely wrong. And I wanna make that very clear on camera right now. 548 00:32:42,910 --> 00:32:46,700 Ejaaz: Apple has a distinct advantage, which is they own the entire consumer hardware 549 00:32:46,700 --> 00:32:48,620 Ejaaz: ecosystem, 3.5 billion devices. 550 00:32:48,870 --> 00:32:52,760 Ejaaz: And now they have the hardware, the chips, to run some of the best frontier 551 00:32:52,760 --> 00:32:55,210 Ejaaz: models on your phone. They may not be as large as Anthropics. 552 00:32:55,210 --> 00:32:57,060 Ejaaz: They may not be as large as OpenAIs. 553 00:32:57,290 --> 00:33:00,420 Ejaaz: But they're trained on your data. And you can do something that none of these 554 00:33:00,420 --> 00:33:04,580 Ejaaz: other AI labs can do, which is ask Siri to basically find that text that your 555 00:33:04,580 --> 00:33:06,670 Ejaaz: mom told you to do the thing and you forgot what it was, or, 556 00:33:06,950 --> 00:33:09,510 Ejaaz: you know, bring back that memory of like when you were hanging out with your 557 00:33:09,510 --> 00:33:10,600 Ejaaz: best friend, doing blah, blah, blah. 558 00:33:10,820 --> 00:33:13,810 Ejaaz: It has full context, grounded context on your entire thing. 559 00:33:14,090 --> 00:33:18,630 Ejaaz: And that is a feature we haven't seen and one that I'm personally super excited to use. So... 560 00:33:18,970 --> 00:33:22,430 Ejaaz: That is all the news for today, folks. Josh, any final thoughts? 561 00:33:22,650 --> 00:33:26,230 Josh: You're caught up. No, that's everything. The vibes have been crazy high this 562 00:33:26,230 --> 00:33:27,650 Josh: week. The news has been insane. 563 00:33:27,870 --> 00:33:32,940 Josh: Lots of things that I think we're probably personally excited about have been released. We got WWDC. 564 00:33:33,150 --> 00:33:38,320 Josh: We got a new Frontier AI model. And we got the biggest IPO in history all in one week. 565 00:33:38,320 --> 00:33:39,010 Ejaaz: It's crazy. 566 00:33:39,190 --> 00:33:40,640 Josh: It's like there are weeks where- We also got. 567 00:33:41,160 --> 00:33:43,760 Ejaaz: The Knicks dub yesterday. Please, let's not forget. 568 00:33:43,960 --> 00:33:47,280 Josh: For the New Yorkers. Ejaz and I are both in New York, both big Knicks fans. 569 00:33:47,480 --> 00:33:51,050 Josh: Huge. hopefully the day after you're watching this they win the championship 570 00:33:51,300 --> 00:33:55,010 Josh: that'd be pretty amazing given the vibes this week i suspect that's that's likely 571 00:33:55,010 --> 00:33:57,140 Josh: that feels probable just on a vibes based opinion 572 00:33:57,460 --> 00:34:00,620 Josh: um but yeah very excited about all the things that are happening very excited 573 00:34:00,620 --> 00:34:03,460 Josh: that you have made it here to the end of the episode and are still listening 574 00:34:03,460 --> 00:34:05,940 Josh: so thank you so much for all the support as always 575 00:34:06,270 --> 00:34:09,700 Josh: if you enjoy this as always also don't forget to share it with a friend anyone 576 00:34:09,700 --> 00:34:12,950 Josh: who you think might be interested anyone who asks you should i buy the spacex 577 00:34:12,950 --> 00:34:15,000 Josh: ipo maybe send in this video and say, 578 00:34:15,350 --> 00:34:18,790 Josh: not only should you buy it, you should set, I'm not, I can't go that far. 579 00:34:18,790 --> 00:34:21,370 Josh: Don't make your own. This is not financial advice. 580 00:34:21,370 --> 00:34:25,030 Ejaaz: Actually, if you disagree with us, if you disagree with us, we actually want 581 00:34:25,030 --> 00:34:28,040 Ejaaz: to hear from you. Like we have been combing through the numbers. 582 00:34:28,040 --> 00:34:31,440 Ejaaz: We've been combing through the projections and we're like, this kind of makes a lot of sense to us. 583 00:34:31,730 --> 00:34:34,640 Ejaaz: But if you're adamant that we're wrong, let us know in the comments. 584 00:34:34,640 --> 00:34:37,420 Ejaaz: We're hearing, we're going to hear you. We're going to see you. 585 00:34:37,620 --> 00:34:40,400 Ejaaz: We're going to respond to you. So we want to hear from you, whether you hate 586 00:34:40,400 --> 00:34:43,740 Ejaaz: our opinion or you love it. Like tell us where we're wrong. Tell us where we're right. 587 00:34:44,240 --> 00:34:46,410 Josh: Yeah, and I'm also going to disagree with you. So I'm ready to go to war in 588 00:34:46,410 --> 00:34:48,320 Josh: the comment section. Bring it on, baby. 589 00:34:48,700 --> 00:34:51,020 Josh: Tell me why SpaceX isn't the most valuable company in the world. 590 00:34:51,020 --> 00:34:53,970 Josh: Come on. But yeah, that's it. Thank you guys always so much for watching. 591 00:34:53,970 --> 00:34:54,820 Josh: Have an amazing weekend. 592 00:34:55,100 --> 00:34:57,310 Josh: Enjoy the weekend. Hopefully, by the time you're watching this, 593 00:34:57,310 --> 00:34:59,310 Josh: SpaceX is going up only. That'd be great. 594 00:34:59,940 --> 00:35:02,280 Josh: If not, I'm sure we'll hear about it. 595 00:35:02,440 --> 00:35:04,420 Ejaaz: Long term. The thesis is long term, Josh. 596 00:35:04,460 --> 00:35:07,230 Josh: Yes, we're long term. This is a low time preference show, man. 597 00:35:07,230 --> 00:35:10,150 Josh: I'm here for a long time, not a good time. Or a good time and a long time, 598 00:35:10,150 --> 00:35:12,750 Josh: I guess. But it doesn't matter the timelines that it happens on. 599 00:35:12,750 --> 00:35:14,430 Josh: But yes, thank you all so much for watching. 600 00:35:14,630 --> 00:35:18,900 Josh: Have an amazing weekend and we'll see you next week for another set of episodes on Limitless. 601 00:35:18,900 --> 00:35:19,800 Ejaaz: See you. See you guys.