Subscribe
Share
Share
Embed
TBPN is a live tech talk show hosted by John Coogan and Jordi Hays, streaming weekdays from 11–2 PT on X and YouTube, with full episodes posted to Spotify immediately after airing.
Described by The New York Times as “Silicon Valley’s newest obsession,” TBPN has interviewed Mark Zuckerberg, Sam Altman, Mark Cuban, and Satya Nadella. Diet TBPN delivers the best moments from each episode in under 30 minutes.
You're TV. Today is Monday, 06/15/2026. We are live from the TV panel, the temple of technology, the fortress of finance. Let me tell you about ramp.com. Time is money.
Speaker 1:Save both. This is corporate cards, bill pay, accounting, and a whole lot more all in one place. The chat wants me to pronounce, and it's gonna be a fun day. Obviously, Mistral is in the news. Incredibly bullish for Mistral.
Speaker 1:Obviously, very unfortunate drama happening in the Anthropic world. We'll go through all of that. But if the if the sovereign AI thesis could not get any stronger right now, this weekend really showed a lot of countries, hey, maybe we do want a national champion. Hey, maybe we do want someone that will provide us models forever. We're also going to be going through SpaceX IPO.
Speaker 1:We have Gavin Baker joining in thirty minutes. And we're recapping UFC Freedom two fifty. It happened at the White House last night. Jordy, take us through your reactions. Introduce our first guest to the show.
Speaker 2:Okay. Quick intro on the event overall. Yeah. I am a UFC fan. Yes.
Speaker 2:It's one of the few sports, maybe the only sport, where I actually know the names of the people that are competing. Our guest in just a few minutes is is one of those people.
Speaker 1:And are you more of a fan of the UFC or more of a fan of the government? Because a lot of people were watching just because they're fans of the government, and they're and they said, oh, I will watch any I watch C SPAN all day. I'll go ahead watch anything that happens if it involves the government. This was an interesting cross
Speaker 2:No. More more seriously. Mhmm. I as a UFC fan Mhmm. And as an American Mhmm.
Speaker 2:I'm excited for the for the UFC to do well. I'm excited for the fighters to have a platform. I was a little bit wary of this event overall Sure. Just because the aesthetics of putting on this crazy party
Speaker 1:High stakes.
Speaker 2:In this moment Yeah.
Speaker 3:When There is a ton to black pill about.
Speaker 1:Yeah. Not after Interest rates, all this other stuff going on.
Speaker 2:And yeah. So war raging, gas prices are high, house prices are high Yeah. Rates were going up. Having a party. A lot of people in America are not having a good time.
Speaker 2:Yep. And it really felt like a bread and circuses moment. Sure. But the bread and circuses, John, it worked on me.
Speaker 1:Top notch.
Speaker 2:It worked on me. Some of the best ever. It was it was Why
Speaker 1:was it so good compared to a normal UFC event?
Speaker 2:Well, you didn't watch. So I guess it's I guess it's hard.
Speaker 1:Was it the aesthetics or the actual
Speaker 2:Well, so one, the production value one, the card was absolutely stacked. It was eight fights. Yeah. No filler. Yeah.
Speaker 2:Wall to wall. Yeah. Really really fights that had a lot of they carried a lot of weight. Mhmm. So like the the main title fight, Gaethje versus Ilya Tapuria Mhmm.
Speaker 2:That changed both fighters careers. Mhmm. Like, full stop.
Speaker 3:Yeah.
Speaker 2:Right? And even with Bo Nickal joining in just a few minutes, you know, Bo, that was the biggest possible stage Yep. That any athlete could be on, and especially in the UFC, at least here in in America. So anyways, going into it, I thought the aesthetics were bad. I was excited to watch the fights.
Speaker 2:Yep. Turned out, it was just really cool. Yeah. And sure, there's still gonna be people that are upset that the the that the the president and the admin is like platforming something like this. Turned out to be really fun.
Speaker 2:It was it was a cool night. Yeah. And I think America kinda needed it. Yeah. A lot of
Speaker 1:people are saying it's not unprecedented because Teddy Roosevelt held a boxing match in the White House almost a hundred years ago around that time. And apparently, he fought in the boxing match, which is
Speaker 4:big big boxer.
Speaker 1:He was a big boxer.
Speaker 2:And so Imagine.
Speaker 1:Imagine. So this is like a light a light crazy mess.
Speaker 2:Anyway. Anyways.
Speaker 1:You have a guess.
Speaker 2:Yeah. I you know, the the event was was incredible and I came away thinking that big parties and sporting events are potentially the most underutilized political strategy. Right? I would actually expect the the admins like overall popularity To go up. Approval rating to go up based on based just on this event because there were so many iconic images.
Speaker 2:Funny enough, the most iconic image Yeah. Is of a Brazilian named Diego Diego Lopez which we had up on the screen there.
Speaker 1:Standing up on that.
Speaker 2:But but anyways Right. Really really wild. And let's bring in let's bring in Bo.
Speaker 1:Let's bring in Bo Nickal. We talked about it many times on the show. Welcome to the show.
Speaker 2:How are
Speaker 1:you doing, Bo?
Speaker 5:Doing great, guys. Thanks for wrapping me on.
Speaker 1:Thank you so for taking the time.
Speaker 2:Long long overdue. So backstory here is Bo somehow was like one of the first 10,000 people to discover TBPN. You're you're an entrepreneur outside of outside of the octagon and somehow you were in between camps or maybe during camps you you maybe saw a funny clip of a couple guys in suits. And, yeah, I remember getting the notification like, Bo Nickal has followed you. And I was like, oh, who's this who's some troll like, attending to
Speaker 1:be Bo Nickal? Fake account.
Speaker 2:It was you. Scamming. And it was a funny moment because yeah. You know, I probably hadn't even shared that I was a UFC fan on the show. So first off, congratulations.
Speaker 2:Congratulations. I was a of the fights last night were high stakes and but but yours was the highest stakes because I was watching and I I can't imagine what you were going through in the lead up to the fight. But you you had a a perfect performance and and it was really fun to watch. Wanted to first off ask what it was like leading up to this event. Highest profile UFC event ever by far.
Speaker 2:And and I wanna know I I wanna know what that was like.
Speaker 5:Yeah. It was pretty interesting. I think my experience was a little bit different than a lot of the fighters because I knew immediately after my last fight seven months ago that I was gonna be on the card. You know, I think most guys didn't find out till, you know, probably ten, twelve weeks out. And, you know, I knew seven months that I was gonna be on it.
Speaker 5:So I started prepping immediately. And yeah, it was just a lot of a lot more media, a lot more attention, a lot more buzz, tried to take advantage of that as best I could, you know, first and foremost by being prepared to whoop ass. But secondly, just, you know, the opportunity with the the, you know, viewership and stuff like that and maximizing that. So But
Speaker 2:is that is is that knowing nine months out that you're gonna be fighting like, you know, five feet from the president on the White House lawn
Speaker 1:Is that an advantage?
Speaker 2:Is that an advantage or a disadvantage? Because in some ways, you're probably more locked in, you know, you're taking every moment more seriously. But on the other side, like, I know, I There's been moments where I know I'm gonna be like doing public speaking. Right? I don't really love public speaking.
Speaker 2:And and I and I and usually, I'm thinking like, it'd be nice to just get this over with. But nine months out, you know, you're you don't You you gotta that's a lot of time being like, oh, I wanna I wanna get in there.
Speaker 5:Yeah. It it definitely goes in waves. Like, you know, there's certain times where you feel a little more stressed, then certain times you feel really relaxed. For me, was just staying focused on the process, focused on my systems, refining everything that I do, and improving every day. And I knew if I kept doing that for that period of time that I'd just be as prepared as possible.
Speaker 5:So, you know, it really, like I said, riding those waves was was big, and just being able to, you know, kinda stay stay focused on the process and my systems and refine those rather than, like, thinking about this big moment twenty four seven.
Speaker 1:Was the crowd any different? Was the vibe in the stadium any different? Does that affect you during a fight?
Speaker 5:It was way different. To me, I come from a college wrestling background. So, you know, when you're competing in a home match, you got ten, twenty thousand people that love you, want you to win. Right? And and since transitioning to MMA, I've had, like, a little bit of mixed emotions towards me.
Speaker 5:Some people love me, some people hate me, which is it's good for me at the end of the day, but this one definitely felt more like my college days, whereas a home match, I felt like everybody was on my side. President Trump was actually the way he was kind of positioned around the ring, it was like he was right next to my cornerman. So I was he was, like, almost in my corner. And, yeah, it was it was thick.
Speaker 1:That's crazy. What what about the prep? I saw folks doing walkouts from the Oval Office. Do you have enough space to sort of get in the right mindset? Are you stuck in a trailer?
Speaker 1:Like, what is your day of the fight like?
Speaker 5:Yeah. Day of fights, I try to just keep it loose. They have you report a few hours early, but I'm just hanging out with my friends, everybody that's visiting and come watch me. And once you get in, you just you get warmed up, get your gloves on, get taped up. And then what was really unique for this one is the walkout being next to a medal of honor recipient and another another military member was just like, they're walking out with you.
Speaker 5:And so I showed up, and the guy that I was next to, he like, was just a total badass older guy and was like, you ready to do this? And I'm like, hell yeah. Let's go. So, you know, that just got me hyped up and just had to have fun with it.
Speaker 1:I feel like every UFC is a Super Bowl in some ways. It's it's the top every time, but this was a particularly special moment. Is are you, optimistic that, the UFC will find other ways to sort of create even more special events in a calendar crowded with, like, special events that happen fairly regularly. Not necessarily it's gonna be 02:50 at the White House Lawn, but you can imagine that there's just something that breaks through and goes into the mainstream media even bigger like this one did.
Speaker 2:I don't know. I don't know how you I don't know how you go bigger.
Speaker 1:I don't know.
Speaker 5:I don't either.
Speaker 1:In space, on the moon Hey.
Speaker 2:Hey. We've been we'll talk about frames later. Top of the Eiffel Tower.
Speaker 1:Yeah. On top of the yeah. Maybe. Who knows?
Speaker 5:Who knows? They're they're gonna figure out something. They always do. There's always something that comes along. But yeah.
Speaker 5:I mean, I I was told this actually did more viewership than the Super Bowl,
Speaker 1:which Yeah.
Speaker 5:Doesn't surprise me. But yeah. It was it was unbelievable. I mean, they're gonna figure something out. I'm just gonna keep getting better at fighting.
Speaker 5:So I focused on that and take care of business on my
Speaker 2:end Where and get a were you watching Ilya Gecchi from?
Speaker 5:So what they did was they had us go back to the hotel, do media, and then they had a little room set up for us where we could have all of our families and stuff because post fight, they had the presser with all the winners, and we had to wait until main event was over to do the presser. So they kind of set up a nice little area with food and stuff for us. But it was all the fighters in there together, and it was it was a pretty cool environment. It was insane.
Speaker 2:Yeah. That was John John, given that he didn't watch even though he was cheering for you and
Speaker 1:and out here.
Speaker 2:No. You're it's okay that you're it's okay that you're locked in. It's okay. You're probably meeting your like doctor. Explaining, like, me to me, that was that was the most, you know, the the Gaethje, Ilya was the most insane UFC moment, you know, going in underdog.
Speaker 2:He's lost to a bunch of guys that that He's lost to multiple guys that that Tupuria has, you know, wiped the floor with. Yeah. And for Gaethje to do that in that moment Mhmm. Just felt like what a way. I mean, I I was I was just really happy for the guy.
Speaker 2:One of those guys who's been on top and as an American UFC fan. I bet I bet that fight created like a bunch of Gaethys and a bunch of and a bunch of Bo Nichols.
Speaker 1:I love it. I love it. What what is the week, month, rest of the year look like for you now? Like, what is it like off this?
Speaker 2:I texted Bo last night like, so happy for you. You know, blah blah blah. You texted back in like thirty seconds. I was like, what are you doing right now? I would I would have just thrown my phone.
Speaker 2:Yeah.
Speaker 1:Yeah. And they grind themselves.
Speaker 5:Post fight for me, I'd probably take like a week or Mhmm. Ten days to do a little media tour just to
Speaker 1:Nice.
Speaker 5:Kinda maximize that and, you know, do as much as I can. And it's kinda just like, you know, business, but I got a couple things planned for the summer. Of course, a bunch of training. Gonna take a two week trip to Japan, see Japan, which is gonna be dope. Mhmm.
Speaker 5:But, yeah, usually post fight, like I said, try to, you know, take advantage of the media buzz and then, you know, maybe work a little bit on on some of my businesses, things like that while I'm not, you know, directly preparing for a fight and couple couple weeks for a vacay if I can slip that in. But, yeah, it's always staying busy.
Speaker 1:You're going to Japan. Anything we can do to get you to stop over in China and get in the ring with one of those humanoid robots? I wanna see you clock it so hard.
Speaker 2:Yeah. Need a bow. We need bow
Speaker 1:Loads into a million.
Speaker 2:These humanoid companies. Need to create bow bench. Yep. And it's like, Ken, how long
Speaker 1:with with ten milliseconds.
Speaker 5:Yeah. No. Easy money for me. I might break my hand on him for that, but I'll I'll I'll
Speaker 2:destroy him for saying.
Speaker 1:Padded gloves
Speaker 2:or something. I don't know. Happy for you. Enjoy the moment and come back on Whenever you want. Next time whenever you want to talk about some of your businesses.
Speaker 2:Yeah. And yeah, we're we're we're very proud and and yeah, enjoy
Speaker 1:the moment. Honored to have you as a fan. Thank you so much.
Speaker 5:Let's do it. Thanks guys. Appreciate y'all.
Speaker 1:Have a great rest of your day. We'll talk to you soon. Thank you. Let me tell everybody MongoDB. What's the only thing faster than the AI market?
Speaker 1:Your business on MongoDB. Don't just build AI. Own the data platform that powers it. So the other big topic over the UFC was the fact that Dario Ahmaday was not in attendance. He wasn't front row.
Speaker 1:Mark Zuckerberg was. And it sort of underscores this odd situation that Anthropic's in where, like, they just got dealt this weird hand where, like, they're doing so well and the admin could not be more misaligned aesthetically with Anthropic.
Speaker 2:Their their whole brand.
Speaker 1:Yeah. But their whole brand. They're very, very different
Speaker 2:and I was I mean, I was I was, you know, I read the article yesterday Mhmm. That that Anthropic staff were going to Yeah. Washington DC. And some were like, oh, this this this is, you know, this is bad. Like, if it was they could if they could solve the issue easily, they could they could do it over the phone.
Speaker 2:Not how this works. You always go. Serious issue.
Speaker 1:Everybody goes.
Speaker 2:Show, you know, the yeah. You would obviously go. But going to wash flying to Washington DC to try to solve an issue on a Sunday, there was not a worse
Speaker 1:They'll be here. They'll be No. No.
Speaker 2:I know. You can imagine you land there. You're like, okay. Like, where is everyone? Let's let's like, meet as a big issue.
Speaker 2:Let's meet. This important. The national security is on the line. Like, let's figure this And they're like, where is everyone?
Speaker 1:And, like, if you take safety seriously, cybersecurity seriously, biosecurity seriously, export control seriously, like like UFC could not be less aligned with that, the stakes there. And so, like, there is this big gap between the administration and Anthropic. And I think that everyone should like, every American should care about bridging this gap. Like, private enterprises should be able to flourish in The United States. Everyone agrees with that.
Speaker 1:And the government should be able to enact reasonable regulations to protect America's interests. And both of those need to find a way to play together, but there is just a really, really broad gap between these two organizations. And so everyone's hoping that things resolve quickly. And it seems like the right wheels are in motion. The flights have been booked or already taken and things are moving along.
Speaker 1:But just a recap on the play by play. March 4, Anthropic received a Department of War supply chain risk letter that, of course, got rolled back eventually. April 7 was the Mythos preview announcement alongside Project Glasswing. June 9 was the Fable five launch last Monday, Mythos with guardrails around cyber, bio and AI research. And on June 12, just five days after the end of the week, Fable five gets suspended after the Commerce Department issues export an export control directive.
Speaker 1:So Anthropic explained in a blog post that the U. S. Government is restricting both Fable five and Mythos five from being used by any foreign national, whether inside or outside The U. S, including foreign national Anthropic employees. And so that's a huge compliance burden, very sudden.
Speaker 1:And that led Anthropic to completely suspend the use of those models for all users, just foreign national employees because they need to, at least if they want to comply with this, do all the KYC, understand how different organizations are using the model, who at those organizations has access. If something's being vended through an API and it's showing up in another product, does that product do all of the proper authorizations? And so it's a big wrench in the gears of the rollout of this model. Then the information reported that Andy Jassy at Amazon had raised concerns with the senior administration officials about jailbreaking the risk of jailbreaking Fable and getting access to all of Anthropic. Anthropic countered in their blog post saying, We reviewed a demonstration of this specific technique being used to identify a small number of previously known minor vulnerabilities.
Speaker 1:These vulnerabilities all appear relatively simple, and we have found that other publicly available models are able to discover them as well without requiring a bypass. So they're saying this isn't that big of a jailbreak. This isn't that big of a deal. We can move forward safely. We've taken safety seriously.
Speaker 1:But that is the debate that's going on between the admin and Anthropic. So as everyone knows, rollout of Fable five has been a bit rocky. Incredible demos, incredible benchmarks, but offset by the odd decision to silently degrade the quality of the answers related to Frontier AI development instead of just refusing the request like cyber and bio prompts, which that was the main thing that everyone was really confused about. The actual rationale behind AI development refusal is pretty sound. Like people are upset about that if they're working on machine learning systems, recommender systems, anything that requires you know, like instantiating an AI product, let alone if you're just, hey, I'm just doing open source AI research and I'd love to use the latest and greatest models to help me.
Speaker 1:Now it's not an option. But at the same time, just think about the logic. If a model doesn't let you hack a system, just have the model build you an unrestricted model that does let you hack your system that system. And so clearly, in that scenario, it makes sense restrict. If you want to restrict hacking or bio, you also have to restrict the tool that makes the tool that hacks the system or develops the bioweapon, in theory.
Speaker 1:And so but the choice to silently degrade responses was not well received. These are important issues. And there's another timeline where AI leaders are cut from the same cloth as America's elected officials. But we're in a world where Anthropic has to make their case for safety in an age of RSI during a UFC fight on the White House lawn. It's a very bizarre timeline, but here we are.
Speaker 1:Most of the big tech CEOs, they have figured out how to work with the administration effectively, showing up to large dinners, photo ops, the occasional movie screening to make their case about hot topics. Many of these CEOs also have business relationships with Anthropic either on the customer side or on the investor side, and that's what's really complicated about the Amazon relationship. Obviously, Amazon uses Anthropic models, also is an investor in Anthropic, also provides compute to Anthropic, And so they have a very hairy, complex circular relationship. And so that clouds the discussion over whether or not is Anthropic going to try and help Anthropic get through this? Are they doing everything above board?
Speaker 1:At the same time, know, people were sort of putting out that like, did did Amazon like spike the ball on this? And at the same time, if the government comes to you and asks like, hey, you're a big tech company. You've been using this model a lot.
Speaker 6:Was partner to Were a
Speaker 1:you able to jailbreak it at all? And your security team just issued a report like, yeah. We actually were able to just jailbreak it a little bit. Like, you're not gonna withhold that from the government. You're going to turn that over.
Speaker 1:That's different than calling and saying, hey. I I I really think it's dangerous. You gotta put pressure on them. So there's this wide range of levels of interaction that can go both ways. You can be a lab partnered with a big tech company.
Speaker 1:That big tech company can have a really established government relations group that is actually helping you get through to the admin. On the flip side, you could have a big tech company that is competing with you or frustrated by your business and is actively trying to put their thumb on the scale the other way. So I'm sure we'll learn more in the future. Many of these CEOs have business relationships with Anthropic, so we'll see how all of this develops. And they're always renegotiating these contracts too, which makes things more complex and they're competing across multiple markets.
Speaker 1:So expect the four d chess to be on full display all summer long in Washington. Anyway, UFC, Anthropic, what else is going on? Meta is doing a one eighty according to Amir over at The Information, trying to be the vanguard of token minimizing. I think the token maxing, token minimizing thing is so silly because do do you know where maxing comes from, really? Like, it comes from gamer lingo usually and
Speaker 2:Adopted by the Luxmaxing community.
Speaker 1:I I don't know if Luxmaxing community was the first one. They certainly made it really they
Speaker 2:popularized like, I feel like through Yeah. Effectively clavs clipping Yeah. That the idea of like doing anything like, oh, I'm I'm computer maxing today.
Speaker 4:Yeah. Mean, isn't it from like min maxing?
Speaker 1:Min maxing. And that's what I'm getting at. Like, you shouldn't be token maxing or token minning. You should be token min maxing. And the idea of min maxing is when you're in a video game, you want to get the most resources for the lowest cost.
Speaker 1:So if you're playing League of Legends, you're going to put just the right amount of of gold into this particular item or this particular stat point in an RPG, and you're going to try and find the optimal build based on your resources. You have confined resources. And somehow, it feels like these like, tech and all these companies went through some sort of hallucinatory period where they lost sight of that they should always have been min maxing because that is the goal of business at all times in all things. Like, you would never say like, Oh, yeah. We're ad maxing this quarter.
Speaker 1:We're going to buy as many ads as possible. Oh, no. It didn't work. We spent way too much on ads. They were not effective.
Speaker 1:We need to admin, spend as little as possible on marketing.
Speaker 2:It's like And there was No.
Speaker 1:You always want to be spending always wanna be getting the most return on ad spend, the highest leverage output
Speaker 7:Yeah.
Speaker 2:Party. There was and again, unsubstantiated post Yes. But somebody was saying they talked to somebody at Meta Yeah. And there was one engineer that spent $90,000 in one day Oh. And was quickly terminated.
Speaker 2:Oh. Really? Terminated within three days. So again, could just be entirely fake news but Okay. Yeah.
Speaker 2:It seems somewhat informed.
Speaker 1:The crazy thing is that is that like the lesson from that
Speaker 2:will This guy be is like, I'm not getting fired. I'm gonna use AI more than anyone else in the whole company. Ride loops. $90,000 bill.
Speaker 1:The I mean, the so so the lesson that will be learned from that is is don't spend $90,000 a day. But like the Super Bowl is literate for a marketer. The Super Bowl is spend 5,000,000 in one day. And it works sometimes. And sometimes Super Bowl ads deliver $20,000,000
Speaker 2:but but what do teams do when they run Super Bowl ads? Right? We ran our Super Bowl ad. Yeah. We we trained our own model Yeah.
Speaker 2:In order to Yeah. Yeah. Kidding. No. But
Speaker 1:We made sure that ours was ROI positive. And we only bought the ad in a small market and we did it before the game. Where our audience And so for a very low cost, we were able to get a very high value. So I believe we got a very high return on investment. We midmaxed the Super Bowl.
Speaker 1:Now there were some companies that sort of just Super Bowl maxed, and they just spent a ton of money. And when you looked at the data on how they were received by audiences, it seemed like, oh, they definitely didn't get $5,000,000 in brand value back. In fact, maybe that ad was poorly received, some of the AI generated ads.
Speaker 2:Easy. I gotta I gotta give it up to the UFC for the for the Ads. Level of advertising during the event yesterday.
Speaker 1:They're running full full ads in the middle? I thought the only thing
Speaker 2:in the
Speaker 1:UFC was no ads.
Speaker 2:No. So one of interesting thing
Speaker 1:Just in just in branding.
Speaker 2:No. With the new Paramount deal, there's a lot of ads. Okay. But one, Dana White was in a lot of the ads Oh. That were running.
Speaker 2:So so like Dodge was doing a TRX ad. Mhmm. It was Dana White driving. That's cool. There was another ad.
Speaker 2:I forget the brand. Yep. I guess it was a bad ad. But Dana White was they faked a podcast set where it was an Oh. With an insurance company.
Speaker 2:And Dana was having a conversation about business insurance with the CEO of the company. Interesting. So it looks like a podcast. So I I thought it was interesting they were casting Dana and all of them. Then second, the the the level of advertising just in Yeah.
Speaker 2:The octagon was out of this world. There was so many different ways to gamble. Mhmm. Every there was like, there's no like the UFC UFC cannot do like a gambling exclusivity deal with anyone. Right?
Speaker 2:Because it's like they have it's crypto.com. It's Okay. Polymarket. It's bet three six five. Yeah.
Speaker 2:Any possible way that you could wanna, like, gamble?
Speaker 1:Bet three six five. So the only day you're cape you're taking off is leap day. Every four years, you take one day off of gambling.
Speaker 2:That's That's the kind
Speaker 1:of like the mission. The company. Day off every four years.
Speaker 2:And then and then Cali's running ads during the event.
Speaker 1:Oh, so Cali and Polymarket are
Speaker 2:is in the Octagon.
Speaker 1:Okay.
Speaker 2:But Cali's running a bunch of ads
Speaker 1:Against it? Against it. And they're buying directly through Paramount? Because you streamed it on Paramount. Is that correct?
Speaker 2:Yeah. I don't
Speaker 1:Did you have to pay for it in addition to
Speaker 2:No. No. No.
Speaker 1:Okay. So you pay for Paramount on a monthly basis and then you get UFC for free. Yeah. Got it. Gambling is just min maxing done poorly.
Speaker 1:That's true. That's true. Anyway, so the news around Meta Meta is doing a one eighty, trying to be the vanguard of token minimizing. Two months ago Meta epitomized token maxing on trend, on track to spend billions a year on cloud, etcetera. We've seen an exponential increase in AI usage, and we are tracking to spend billions on internal use alone in 2026.
Speaker 1:The memo said, at the same time, individuals and teams have limited visibility into and control over how they use AI. In 2027, we expect Meta will move towards managing AI tokens in a more structured way with bullet budgets, allocation decisions, supporting tools. That makes sense. You have a marketing budget. You should also have a token budget as
Speaker 2:part I also saw something they have, like, Meta code, which is their internal
Speaker 1:Yeah. That makes sense. I mean, they're they're like, you know, catching up to the frontier with
Speaker 4:Yeah. I mean, it's like I've talked about this. There's bunch of like these leaked calls where Suck is like Yeah. You know, you you should imagine that met employees are gonna be better than like the the average open source Yeah. Contributor.
Speaker 4:So it's like the the basically quality of of coding data within Meta. Should be super good. Can train some model
Speaker 1:on that. It's the same pitch as take a frontier model, bring them in through some sort of consulting partner. They fine tune on your business workflow. They automate your business process. But your business process in this case, if your meta is generating code that makes your social networks better.
Speaker 4:Yeah. It's especially good because, like, in meta, all of the, like, you know, internal business, like, whatever data. It it's already in like code format. You you don't you don't have to like scan in a bunch of papers
Speaker 1:Yeah.
Speaker 4:Into, you know Yeah. Like digital still
Speaker 2:I still don't know what Meta is actually building. And I think there there comes a time soon that they should probably communicate that to the market.
Speaker 1:Personal super intelligence, baby. What's not to what what's there not to understand?
Speaker 2:No. It's just what does that mean?
Speaker 1:75% as valuable as SpaceX, buddy. Come on.
Speaker 2:It's crazy. SpaceX, well SpaceX is 2.3. Well, if things keep going the way they're going, we'll see even more of a divergence. No. But I think like it's so unclear.
Speaker 1:You should be able to put a lot of the SpaceX bull case on Meta. Right? It's like, sure, they maybe maybe Colossus was built a little bit faster, but Meta's pretty fast.
Speaker 2:Think they're wildly I think they're they're couldn't be more different. With Meta right now, it's the bull case is it's potentially the greatest business in the history Yeah. That is not threatened by AI Totally. Totally. That actually is accelerated by AI.
Speaker 2:Yeah. And and I don't think any anyways. Yeah. But I do think I do think I would expect some communication from Meta around what their real strategy is
Speaker 1:Yeah.
Speaker 2:Over the next month or so because it's killing them that they just keep saying, oh, we're personal super intelligence but
Speaker 1:Yeah.
Speaker 2:Wait, they're building like a coding harness and working on coding. Like, are they gonna sell that externally or is it gonna be internal?
Speaker 1:Coding. Are
Speaker 2:they gonna are they gonna try to
Speaker 1:Coding seems like it makes sense.
Speaker 2:They're Are they gonna their model on an and get into enterprise? Like, the big question is like, do they take the leap? They kinda did that with Manus. Yeah. But that's getting unwound.
Speaker 1:Well, let's talk to Gavin Baker about it. But first, let me tell you about the New York Stock Exchange. One changed the world, raised capital at the New York Stock Exchange. Our next guest is the CIO and management partner of Tradies Management. You've heard him on Invest Like The Best many times.
Speaker 1:Gavin Baker, welcome to the show. How are you doing?
Speaker 6:Doing great, man. How are you guys?
Speaker 1:Fantastically. Right? SpaceX IPO. It seems like everything went just flawlessly to a tee, like, to the point where it wasn't even dramatic.
Speaker 2:Give a round of applause for the banker.
Speaker 1:The banker. It's like twenty percent
Speaker 2:Twenty percent pop almost to a
Speaker 7:tee.
Speaker 1:Yeah. What what I mean by that is like is like it would have been more dramatic if it had like popped up 70% and then went down 30 and then went 50 and it was drama. But it was just like perfect execution from start to finish. Was that how you interpreted it?
Speaker 6:I thought Goldman Sachs and Morgan Stanley did a very good job.
Speaker 8:Yeah.
Speaker 1:What do you think the market is looking for SpaceX next? Is it all eyes on the first earnings report? Like where do we go from here? Because there's so much of the SpaceX story pre IPO that was a decade out, five years out, two years out. But is the market going to be processing quarter by quarter plays like like many other companies?
Speaker 6:Well, I think the market is always, you know, quarters matter.
Speaker 1:Yeah.
Speaker 6:You know, the runners on x, you know, it's like they're these reply people on x for any topic or experts. Yeah. But somebody once told me a marathon is twenty six one mile runs. Yeah. And so, you know, and then all the runners were like, no, that's not true at all.
Speaker 6:Right? You know, obviously running mile is different than running a marathon. But you know, every quarter matters. But at the same time, I do think if you look at how the market has has looked to Tesla over the last five, six years, you know, Amazon during kind of the days of, you know, when they were building out AWS and then, you know, kind of their their retail distribution infrastructure when they go through these investment cycles. I do think the public market has a much greater tolerance for investment and a much longer time horizon than a lot of people in the venture ecosystem give it credit for.
Speaker 6:By the way, this is Foxy in the back. He's our he's he's one of the analysts here at Atreides.
Speaker 1:I was just listening to him on the Brad Gerstner podcast. I think he chimed in on that. Right? You brought him in? There we go.
Speaker 6:Yes. He did. But he did the work on SpaceX, so I thought you guys might wanna Fantastic. Talk about that. But I do think the I'm not sure the story is as far out as you made it seem to be.
Speaker 6:Mhmm. I There are two variables that are gonna matter a lot over the next year. Mhmm. The first is just how quickly can they bring on terrestrial compute.
Speaker 8:Yeah.
Speaker 6:Does seem like they monetize gigawatts at a higher rate than anyone else.
Speaker 2:Yeah.
Speaker 6:And we know from Jensen that they bring on data centers faster
Speaker 1:Yeah.
Speaker 6:Than anyone else per Jensen's words. Yeah. And everyone in the ecosystem is really incented to get land power in the hands of people who can energize it because everybody starts making more money when the GPUs are energized. So, you know, if they can what what are what what was the altimeter figure for how what they were monetizing gigawatts at Fox? Do you remember for which deal?
Speaker 2:Well, I think it was like two to three wasn't it like at least two times higher than like average neo cloud pricing and that's partly due to scale and customer quality and things like that but it was meaningful.
Speaker 6:Yeah. So they're they're doing 50,000,000,000 a gigawatt on Google deal. Wow. So how quickly they can add gigawatts really matters.
Speaker 1:Yeah.
Speaker 6:Right? If you can energize two, three, four gigawatts
Speaker 1:Yep.
Speaker 6:In the next year, that's a lot of revenue. Now, you know, the prices may go up, they may go down, but that's really gonna matter.
Speaker 1:So all eyes on Colossus three, four, five, six, seven, eight, nine, ten, etcetera, at least in the short term.
Speaker 6:Yeah. Our macro hard, macro harder, macro Hardest. To that day, macro hardest.
Speaker 1:Yeah.
Speaker 6:And then I think cursor is another big variable.
Speaker 2:Yeah.
Speaker 6:You know, we talked about it with Brad about how Composer 2.5 after three weeks of, you know, RL and supervised fine tuning Colossus two is kind of Pareto dominant. So what's going to happen when it's applied to a bigger, better base model? I do think Cursor being in, you know, half the fortune 500
Speaker 1:Mhmm.
Speaker 6:Is interesting. So I think those two things, you know, while I mean I'm super excited for going to Mars and asteroid mining
Speaker 1:and Yeah.
Speaker 6:And you know, a city and mass drivers on the moon, like all that stuff is awesome. And I think there's a, you know, decent chance it happens in my lifetime. I just think there is there's much more tangible near term drivers here.
Speaker 2:Yeah. How do you think about the tension of the cloud business versus their own application and and model business? I think a lot of people were surprised when the initial Anthropic deal happened purely because knowing Michael Truel, he would have been very excited
Speaker 1:That's my compute.
Speaker 2:Yeah. Yeah. Get
Speaker 1:access He's like, hey, couple you gotta
Speaker 2:share. Dave's the only child around here.
Speaker 6:And it
Speaker 2:and it feels like you can imagine SpaceX, you know, bringing on a lot more compute very quickly. But at the same time, every lab has had to go through this tension of like how much how much compute do we allocate to training versus inference. Yeah.
Speaker 6:A way to interpret that is that maybe the team at SpaceX is pretty confident in their ability to bring gigawatts online.
Speaker 1:Yeah. That makes sense.
Speaker 6:And the altimeter figure that they've ordered 20% of the Rubens, and the Rubens is an epic chip. Like Blackwell, it was really hard to get it online. Rubens is kind of a more drop in replacement. Mhmm. It's a really, really good chip.
Speaker 6:You'll have the, you know, the Grok LPUs integrated at some point in the next six, nine months. So one way to interpret that is they're pretty confident that they can bring data centers online pretty quickly. But I also I I don't remember all all of the details, but I do think there there was an out in the Anthropic agreement that if they
Speaker 2:and the Google and the Google deal.
Speaker 1:Yeah. Could
Speaker 6:be short term that's
Speaker 2:what I just meant. It's like it is there is like a tension Yeah. There where if you, you know, there's a moment where maybe you want to compute but you don't necessarily have all of the revenue yet and so you could see. Anyways, I'm I'm very confident that can figure it out.
Speaker 1:Yeah. On on on the topic of like Elon web services, is there a world where SpaceX winds up building out more of what looks like AWS? Like, we've seen between OpenAI and Anthropic, there's this tension of like you got to be on AWS because ITAR or the ecosystem or enterprises just want to be on AWS. They won't even go over to Azure or Google Cloud for whatever. And you could imagine like it might is it enough to just be a token factory?
Speaker 1:Or do you need to have a database and an in memory storage and cloud storage and cold storage and all the things that ABS provides?
Speaker 6:My thought is that being a token factory is more than enough for the next five to ten years. Man, we are yeah. We need more token factories. Yeah. But we'll we'll see.
Speaker 3:Mhmm.
Speaker 6:And if they need that stuff, like
Speaker 2:Yeah.
Speaker 6:They will build it.
Speaker 1:Yeah. How are you thinking about the other hyperscalers, the other big tech companies? We were sort of puzzling over Meta's strategy at this point. Tons of resources, cash flow, data centers. They have experience there.
Speaker 1:Maybe they're not as fast as SpaceX, but there's a lot there. But it's a completely different motion to go into token factory and yet there's still a lot of demand. So how do you think all of that plays out?
Speaker 6:Well, think there's many ways to go to the token factory business. You could if you're if you're meta
Speaker 2:Yeah.
Speaker 6:You could just say to someone like Fireworks
Speaker 1:Mhmm.
Speaker 6:Hey. Here are a 100,000 GPUs. We'll we'll take a revenue split and we'll see what happens.
Speaker 1:Yep.
Speaker 6:I am increasingly looking at EV to net PP and E as a valuation metric. Just with the idea of being installed atoms on earth, I think are gonna appreciate in value. This is a little bit that halo trade that I think maybe Goldman Sachs came up with, you know, high asset value, low obsolescence. Yeah. But Meta, you know, Meta's EV to net PP and E multiple is in an interesting place.
Speaker 6:It just suggests that the market has an immense amount of skepticism about their ability to monetize their own asset base.
Speaker 2:Interesting. And and I think that's I think that's warranted given that all we've really got out of management is this concept of personal super intelligence. Mhmm. And it would be different if Meta AI was like at the top of the app store and everyone you were talking to was like, yeah, know, I'm using Meta AI.
Speaker 1:Or there even there was like a killer feature within Instagram.
Speaker 2:Yeah.
Speaker 1:It's like, people are shopping in Instagram now.
Speaker 2:And I think no one no one doubts that like once Zach has an AI product with a billion dollars of revenue, he can take it to to tens of billions. Mhmm. But it's unclear. I feel like, you know, going into enterprise, you know, what what is this API business gonna gonna look like? We know they can use the GPUs just on making the ads product better at the end of the day and but there's a lot questions.
Speaker 2:Look,
Speaker 6:think a few things. I do think if I look at the way different players are behaving, it feels like everyone thinks we're entering the end game. Everybody, you know, loves to use these chess analogies. And it looks like the endgame may be here sooner than we think. I think that's why OpenAI is cutting codecs pricing Mhmm.
Speaker 6:Simply because coding, you know, coding tokens are so valuable. Mhmm. And if you don't have enough of them, you may not be able to get into this RSI loop that that everyone is, you know
Speaker 1:Pushing for.
Speaker 6:And I I think if you're Zuckerberg, feel that acutely. I thought Muse what is it? Muse It it was to me, it was an upside surprise, and it made me feel like, you know, what's the what's what's what's from Talladega Nights or what is it? So you're saying there's a chance?
Speaker 1:Hell, yeah.
Speaker 6:Like, yeah. So you're telling me there's a chance?
Speaker 1:I mean, the other quote from Talladega Nights is if you're not if you're not first, you're last.
Speaker 6:And and you know That's how a lot of people There's so many good quotes from Talladega Nights.
Speaker 1:It's called the windshield.
Speaker 6:Yeah. A 100%. But I think if I'm pretty confident Mark Zuckerberg has proven to be a good entrepreneur over time and has been willing to pivot, you know, and it's just it's so funny, you know, right now, Facebook is, you know, Meta's telling investors there's like no chance that we're gonna, you know, you know, monetize GPUs externally. Well, like, ten days before they announced all those layoffs, which I think was at the end of twenty two. If not, I don't remember when they started to announce the layoffs.
Speaker 6:It was short shortly after Brad, maybe at two months after Brad wrote that letter to Mark where he said, you're the king, you can do whatever you want, but this is what I might respectfully encourage you to do. You know, they went from saying, we're we're not gonna do that, we're gonna keep investing to, you know, super focused on OpEx in a couple of days, man. So it's like people they meet with Meta and they hear, oh, you know, we're not we're not gonna monetize our GPUs externally. Well, I don't know. Check back in a few hours.
Speaker 2:Yeah. Yeah. No. It's like everyone it it comes down to like everyone has a price. You look at you look at Elon and Anthropic's relationship four months ago and then you look at kind of kind of as the opportunity unfolded, it made sense for them to partner.
Speaker 2:Better. I wanted to ask how
Speaker 6:On the meta thing, I think there is one point that's important.
Speaker 1:Mhmm.
Speaker 6:What ultimately drives behavior for all these big cap companies? Like getting to AI, I think that does feel existential for all
Speaker 2:of them.
Speaker 6:But the stock price also really matters. Sure. Because if you don't if the stock goes down, you know, you gave people a grant at this price, stock goes down, you know, your engineers are unhappy and it's tougher to get to where you wanna go if you don't have, you know, these, you know, now forget the 10 x engineer people are talking about, 10,000 x engineer. Yeah. You know, you're not gonna get there if you don't keep those 10,000 x engineers.
Speaker 2:Yeah.
Speaker 6:So just I think, like, we'll see we'll see with Meta.
Speaker 2:Yeah. Yep. How did this IPO update your your general kind of framework for the role that retail is playing in capital markets? A lot of It was very funny last week to see people like say like, oh, the the IPO is only two x oversubscribed by retail.
Speaker 1:Yeah. They're dumb. These all these other $3,000,000,000
Speaker 2:IPOs were were 10 x oversubscribed. It's like, no, we're we're talking about, you know, a very order of magnitude difference here. But it still feels like retail is going to play a very very important role over the next twelve months, maybe more so than ever given that the the the hyperscalers are are now running you know, cash flow negative. You have the conflict in The Middle East, right? There's rebuilding efforts that needs to needs to happen and so I feel like retail this is this is kind of retail's moment now maybe more than ever.
Speaker 6:Yeah. Well, so a few things. One, people say retail in a pejorative way and I would just say stupid is as stupid does. And like, you know, we track, you know, there's all these indices of retail favorites And man, they're up a lot. And they're up a lot 25, and they're up a lot 24.
Speaker 6:You know, so kind of stupid as as stupid does. So I'm not, you know, like I think retail is probably outperforming the overwhelming majority of professional money managers whether they're, you know, private equity managers, venture, you know, public equity managers, whatever. So like retail, I don't think it's a majority of Yeah. I do actually think in the case of SpaceX, I'm not sure, you know, you process so much information. I'm not sure where this comes from.
Speaker 6:But I actually think after the IPO, you know, for whatever reason, it some of that retail stock may have may have gotten allocated to people who were flipping it because my understanding is there was more institutional buying. I don't know where this after the IPO, there was retail buying. Now I'm sure, you know, retail is very sensitive to momentum, so Sure. Maybe what's happening today changes that. But I think another really underappreciated thing about the SpaceX IPO is that 10 over 10,000 SpaceX employees bought on the IPO.
Speaker 6:And that's just, you know, everybody does all these lockup analyses, know, how much stock is gonna come come to market and, you know, for sure, there's all these triple layer SPVs or whatever, you know, or maybe there are, there are, people speculate there are. And I'm sure some of that will get unwound. Mhmm. But the reality is is that SpaceX employees own a lot of this. And if you're an employee or even if you're an investor who has an s an SPV or you're directly on cap table, you've had a chance to sell every six months for the last ten years.
Speaker 6:Yeah. If you wanted to sell, you could have sold and, you know, whatever when they did that offering in in the second half of last year.
Speaker 1:Yeah.
Speaker 6:So I think the supply demand dynamics here here are gonna be very interesting. But with retail in in general, yeah, man, they're they've been a more powerful force in the market over the last three and a half years than at any other time in my career, including the year February, which I think this is nothing like by the way. Mhmm. But yeah, they they matter and stupid is as stupid does.
Speaker 1:I'm interested to go click deeper on the idea of like value will accrue to companies that are in the token path. I think that phrase is extremely powerful right now. But I want to sort of expand it and understand the fringes of the token path because we talked to Matthew Prince at Cloudflare, stocks at all time highs. It's delivering tokens at the edge and obviously there's an immense amount of AI agents that are interfacing with different websites. They need to be distributed.
Speaker 1:So there's a lot of value there. But is Cloudflare in the token path if they're the one finally sending you the packet of tokens at the edge? Or does that not count? How does that how do
Speaker 6:think about that? Every CDN Yeah. Has has this business. Know, Akamai, they signed
Speaker 1:Yeah.
Speaker 6:What was it? A $1,800,000,000 with Anthropic. And if you have all these points of presence Yeah. And you can deliver really low latency tokens to high value users. I think what's interesting for for cloud for all these CDNs
Speaker 2:Yeah.
Speaker 6:Is they're they're getting a massive premium for that latency.
Speaker 1:Yeah.
Speaker 6:You know, it turns out, you know, one of the lessons from from Cerebras is people are willing to pay for speed. Yeah. And you see that in the prices these guys are commanding, but I do think I mean, my gut is in terms of tokens consumed on planet Earth, these CDNs are delivering less than 1% of them and I mean, maybe less than 10 basis points of Most
Speaker 1:of the tokens are happening internally, and then you just get the Yeah.
Speaker 6:Would I say that these guys are in the token path? I mean, I would say they have a path towards being in the token path.
Speaker 2:Yeah.
Speaker 6:Then they have part of their they have part of their business that's in it today.
Speaker 1:Yeah.
Speaker 6:And they're trying and like everyone, they're trying to move it more and more there.
Speaker 1:Yeah. I I mean, Matthew was talking about co locating NVIDIA servers on the edge, specifically for the delivery of voice models because you want those to be very low latency. Maybe you want your coding model to go off and cook in Virginia for twenty minutes or an hour and then come back to you with the final result. But if you're trying to actually talk to a model, you probably want it as fast as possible. What about on the
Speaker 6:opposite end? Wasn't there that startup that NVIDIA just invested in that like will Oh, yeah. On your house. Money to put a GPU, you know, a four GPU server on the outside of your house.
Speaker 1:Yeah. GPUs are going everywhere. Going in your bed eventually.
Speaker 2:I mean, it's full circle too. Jensen talking about stuff like that back during like the original Yeah. Crypto cycle being, like, everyone's gonna be, you know, mining.
Speaker 1:Yeah. And I mean, the Tesla Powerwall is, a version of that for storing energy. It doesn't store compute, but it stores energy locally on the edge off the grid, and there's a lot of powerful things that get unlocked by that. What about land? Is land in the token path at some point on the extreme other end?
Speaker 1:Because people are obviously searching for go going further and further upstream. They found a a toilet company that makes a particular material that goes into semiconductor supply chain. People are hunting for like the final the final ingredient. Maybe it's just sand that turns into silicon.
Speaker 6:Yeah. I do think the bottleneck bros Okay. As they are called are Bottleneck. This like bottle neck trade is kind of nearing its end.
Speaker 1:Okay.
Speaker 6:And you know, I did you know, the Wall Street Journal had the story about this Japanese company that makes I forget what they make. Is it Ajioto? Yeah. And you know, everybody's in this because they thought they were gonna raise prices and then they just said, we're actually not gonna raise prices.
Speaker 1:This is
Speaker 6:the wrong thing for us. And I almost posted yesterday on x, welcome to Japan to all of the bottleneck people. But you know, everybody's, you know, having clawed, run, what's the next bottleneck?
Speaker 1:Yeah.
Speaker 6:That was that was the game for the last year. The next game is what has enduring franchise value
Speaker 1:Yeah.
Speaker 6:Kind of on the other side of these bottlenecks whenever whenever that is. Mhmm. As far as land, is land a bottleneck? Man, I do think the math for Orbital Compute to me, it once they can reuse Starship
Speaker 1:Yeah.
Speaker 6:I think the math for orbital compute becomes pretty compelling, know, it's just 60,000,000,000 to bring on a gig terrestrially, 25 is power and cooling, you don't need that, it's based.
Speaker 2:Yeah.
Speaker 6:And so the right comp for that 35,000,000,000 of kind of, you know, IT equipment, GPU, CPU, switches, you know, memory storage is is that 25,000,000,000 versus the cost of launch. And once Starship is reusable, I think the cost of launch is 5,000,000,000. So 20 that means you can put a gig into space for 30,000,000,000 and a gig on Earth is 60,000,000,000 and that 25, the power and cooling feels reasonably inflationary to me.
Speaker 1:Sure.
Speaker 6:So I don't know that I would say land is in the tokens token path.
Speaker 1:Maybe beachfront property, but that's about it.
Speaker 6:Yeah. Beachfront property is beachfront property, airplanes
Speaker 1:Yeah.
Speaker 6:Really nice cars.
Speaker 1:Yep. Firmly in
Speaker 7:the token path.
Speaker 6:All that stuff is in the token pass.
Speaker 2:I gotcha. How do you think the events of of last week with Anthropic and DC update different countries on their own sovereign AI play? Because there's been there's been attempts. It doesn't feel like, you know, many of the attempts of, you know, you can have a powered shell and you can have the best GPUs, but if you don't have the talent, it's really It's gonna be really hard to get to the frontier. And now, if you don't have massive usage, it'll also be really hard to get to the frontier.
Speaker 2:And so, do you think the ship has sailed?
Speaker 6:No. Well, look look, I think every country is gonna wanna have their own sovereign AI strategy at a minimum for national defense.
Speaker 2:Mhmm.
Speaker 6:I think where that ends up is I saw today that the EU had restricted exports of mixtrawls with
Speaker 1:I think that's a joke. I think that's a meme. So people have gone so far on the mestral le chat thing, le chaton that that they're saying it's like mythos is distilled on it and it's breaking all the benchmarks. I think it's a good model but I don't know that it's quite there yet. Yeah.
Speaker 1:But you can imagine that we get there for sure.
Speaker 6:Yeah. So I think what Sovereign AI will look like for essentially all countries really other than The United States and and China, although I think China is gonna fall further and further behind Mhmm. Is just some sort of you do you use you know, you use one of these providers do some reinforcement learning on your language, your culture Mhmm. Your values. Mhmm.
Speaker 6:You have a system prompt. You do some supervised fine tuning, and you run that on whatever the best open source model is. I think that's where sovereign AI ends up. And then you run it in your own data centers, so you feel like, you know, it's safe and whatever defense questions you're asking it or whatever, forget questions, whatever. Defense and intelligence, and maybe, you know, policing activities your sovereign AI agents are doing, you know, twenty four hours a day, you feel like they're safe.
Speaker 1:Yeah.
Speaker 6:So I think that's where sovereign AI ends up, and I think, there'll still be a big build out for that. But man, Sovereign AI at the frontier, I don't see it.
Speaker 1:Yeah. What do you think the drivers are of the widening gap between Chinese open source models and American closed source models is?
Speaker 6:China's made a terrible mistake not you know, taking it feels like the administration has been willing to let them buy h two hundreds or p thirties.
Speaker 1:Oh, yeah.
Speaker 6:And I think they're on this like, you know, they have this crazy belief that, oh, you know, our own internal chips are good enough, they're not. Yeah. And then, you know, I think what's making them think that is that Chinese labs are very, good at distillations. Mhmm. Somebody told me it only took a 160,000 reasoning traces from o one and o three to get the original DeepSeek.
Speaker 1:Yeah.
Speaker 6:You know, they're very clever at industrial scale distillation, running it through multiple APIs Mhmm. Pinging each API from, you know, we've all seen those iPhone farms in China. You know, they've got they've got the same thing for distillation and they've got, you know, a 100,000 endpoints distilling these models across every API available. They've gotten really really good at that. But man, all that goes away if people stop releasing these models at the frontier and I think mythos Yeah.
Speaker 6:Is a sign of things to come there.
Speaker 1:Yeah. Yeah. It seems like they're getting much better at locking down. The Reasoning Trace is locking down the the espionage. It feels like back during the l one days, the labs weren't even aware that was so possible that that was that that was something that was such a such a potential threat for sure.
Speaker 1:Jordy?
Speaker 2:Yeah. Please. Is any part of you worried that you'll never see another another company like SpaceX?
Speaker 6:Worried is the wrong word. Not worried,
Speaker 2:but like you have to appreciate you have to appreciate that a moment like that, you It's possible that you have an opportunity to invest in a company like that one time in your career, and thank God you did it. Because there's plenty of people that that had the opportunity and didn't, and
Speaker 6:Well, I did own 15% of the video when it was a sub 2,000,000,000 market cap, but I I owed 10% of Tesla when it's a sub $2,000,000,000 market cap. But SpaceX certainly it's been a special experience for me.
Speaker 1:Mhmm.
Speaker 6:And I think there is a chance that it is, you know, one of the most important iconic companies of all time. I mean, it already is. There's a chance it's the most. And I think in general, it's just it like, I I kinda wanna take a step back and like, all this trillionaire hate from the left, it's like the you know, there's a great post from my friend Kevin Mahaffy saying like, oh, this is a Bond villain who's decarbonizing the world. Last time I checked, people on the left wiped the environment, Connecting, you know, poor people in low income countries, schools and hospitals to the Internet, very low cost, and he's helping blind people see today and Yeah.
Speaker 6:You know, interact with the world. That's a villain. And then just like there's so many parts of the SpaceX story, like all of the, you know, blue collar workers who've gone super well. If you're opposed to data centers on Earth, because the environment well, SpaceX is your is your solution. So, you know, there was another great post that just said, you know, the left what if they don't even appreciate it.
Speaker 6:The world's first first trillionaire, you know, has done more to kind of solve the environment than like everyone else on earth could buy. Yep.
Speaker 1:Yep. Yeah.
Speaker 2:I saw there was another good one. It's like, yeah, Elon could solve world hunger by, you know, market selling every, you know, piece of stock that he has and send the world into a global economic downturn losing, you know Yeah. Millions of millions of in Yeah. The
Speaker 6:Then somebody said that Elon that the World Bank could solve hunger with 5,000,000. And he said if you prove it to me, I'll do it.
Speaker 7:Yeah. Of course.
Speaker 6:And turns out you can't solve world world hunger for $5,000,000. Yeah. But yeah, SpaceX is certainly I would say, you know, SpaceX, Nvidia, Tesla, they've all been very special to me in kind of a different way. But there's nothing like a rocket launch. And so I just don't think as a visceral experience, I highly recommend everyone listening, you guys, if you have kids, take your kids to a launch.
Speaker 6:You don't wanna go with SpaceX. Everybody's always like, oh, get me the special tickets. You just literally you can go to a beach at Boca Chica Yeah. And be where the special SpaceX viewing area is. You could literally be closer to the lodge.
Speaker 6:Yeah. You could there's hotels near Vandenberg. Take your kids, see a lodge. It's super inspirational that humans are capable of this, and it's much more visceral than you realize. Mhmm.
Speaker 6:You know, the sound, the blast of hot air, a lot of people cry. So go see a lodge, but there will be a I don't think I'm pretty skeptical that there will be another company that delivers a visceral experience like that. And then listen, if SpaceX puts a city on on the moon and then Mars, it enables, you know, becomes a British East Sydney company, the solar system. I think this will those there's a lot of hard engineering that needs to happen to go into all that. This will probably be the most important company of certainly my lifetime, but maybe of maybe of all time.
Speaker 6:And so for that sense, I don't think there will ever be anything else like it. And, yeah, I guess that is a little bit sad, but you know what? There's so much awesome stuff happening in the world that it's it's it's tough for me to get too down, man. I
Speaker 2:love it. Yeah. Hard to hard to hard to be too
Speaker 1:I have I have one last question. We have you mentioned owning NVIDIA sub 2,000,000,000. What is the health of the sub 2,000,000,000 market right now? Is there is there anything that you're excited about?
Speaker 2:Is there anything that the bottleneck bros haven't
Speaker 1:ran
Speaker 2:They
Speaker 1:haven't run up to a trillion yet?
Speaker 6:Taken everything under 2,000,000,000 Yeah.
Speaker 1:Not even maybe not even like like public companies, but private areas. I mean, we're starting to see the knock on effects of AI and bio and material science and like Neuralink was sub 2,000,000,000 for a long time. Right? And so there are more air like not in theme, but accelerated by. So I don't know.
Speaker 1:There's also just like Listen you
Speaker 6:know, company. There's loads of incredible venture companies, you know, startups under 2,000,000,000. Yeah. Like, loads of them. Yeah.
Speaker 6:You know, I I I talk to them, you know, several times a week minimum.
Speaker 2:Yeah.
Speaker 6:In public, you know, until the bottleneck bros came along, until AI came along, there was not a lot happening in public small cap land. Yeah. And by the way, on this like, all these small caps, these bottlenecks, this AI, it does feel a little weird to me that you could have like a large following on social media post about, you know, buy buy stock at something.
Speaker 1:Yeah.
Speaker 6:And then post about, you know, outline your thesis in a $35,000,000 market cap company and send it up like a thousand percent. And there's a lot of that going on. And by the way, this is not this is not like a serenity comment. I think that guy is person Mhmm. Is smart.
Speaker 6:But I mean, there's there's there's there's a lot of shady stuff happening it feels like to me.
Speaker 2:Sure. Well, yeah. You look back at you know, you're a young young analyst at Fidelity, right, during the the doc you know, the end of the the .com cycle and there was a lot of just like euphoria stuff happening and in the years that followed, there was consequences. Right? There there were people ultimately had to to face
Speaker 1:Sometimes civil penalties, all sorts of different things. Companies went bankrupt. There were all sorts of different, you know, perturbations in the market. And, of course, we got a we got a bunch of really enduring generational companies through that period too.
Speaker 6:Although a lot of these accounts are anonymous, and I'm sure they're logged into social media with a made up email. Yeah. You know, gone through a VPN. And so I don't I don't know.
Speaker 1:We'll see. Is it is different than a research than a sell side research report that maybe goes a little bit too far, there's still a whole compliance department around it. We are in, yeah, uncharted territory, so everyone needs to stay safe out there and do your own research, I suppose. Yeah. Anyway.
Speaker 6:Well, man, this was super fun. This was great.
Speaker 1:Let's do it again soon. On board. Thank you so much.
Speaker 2:Anytime. Let's get the whole team on too. Yeah. Yeah. On whole team.
Speaker 2:You know
Speaker 6:what that's actually fun?
Speaker 1:Yeah. It'd be Let's
Speaker 6:do that with the whole team.
Speaker 1:It'd be amazing.
Speaker 6:That's awesome.
Speaker 7:I would
Speaker 1:love it. Yeah. Yeah. You're in a
Speaker 6:conference room. You guys
Speaker 1:have conference room with a with a nice wide angle camera. You can just have the whole crew there. That's great. Partner meetings.
Speaker 2:Into a partner meeting. Yeah. Exactly. Awesome. Great to hang with you guys.
Speaker 2:Thank
Speaker 1:you so much coming on. We'll talk to you soon. Let me tell you about CrowdStrike. Your business is AI. Their business is securing it.
Speaker 1:CrowdStrike secures AI and stops breaches. Our next guest is Leaf Abraham. From Public, he's the cofounder, co CEO. Here to break down what happened on Public when SpaceX went public. How are doing, Leaf?
Speaker 1:Good to see you. Beautiful background.
Speaker 8:What's up, guys?
Speaker 1:Hope you're enjoying New York City. What's up?
Speaker 8:It was fantastic.
Speaker 2:Great to see you.
Speaker 1:Wait. Was was Friday crazy for you? Was the weekend crazy for you? Is today crazy for you? Is it all just, like, crazy in the, wow.
Speaker 1:This is a historic moment versus, like, crazy at the office, like, the servers are on fire? Like, does that happen with you?
Speaker 8:Yeah. I mean, by now, it's obviously more kinda business as usual and Yeah. IPOs happen. But on Friday, definitely, I mean, SpaceX was the most popular IPO that we have seen on the app ever Yeah. By, like, a wide margin.
Speaker 8:And, you know, to give an example of, like, you know, of everyone who bought a stock on Friday, nearly half of people who bought a stock on Friday bought SpaceX.
Speaker 1:Wow. Right?
Speaker 8:So which is obviously quite quite crazy. Right? Like, another
Speaker 1:thing diagram is a circle.
Speaker 8:The, like, second most traded stock was NVIDIA, and SpaceX was, like, 533% more trading than NVIDIA that day. Right? And so so definitely, you know, the the like, one of the kind of craziest IPOs that we've seen so far.
Speaker 1:Yeah. What was the retail allocation actually like on the ground? We heard numbers like it's it's double oversubscribed, but then the number that I saw reported was, 100,000,000,000 for retail. And that seemed like way more than what would actually go to retail because so much of it is gonna be anchored by the banks and what I would not put in the retail bucket, like Yeah. Yeah.
Speaker 1:JP Morgan's, like, you know, clients. Right?
Speaker 8:And and you would think so, but I think we when when people talk retail Mhmm. They think what you and I were just thinking of, like, basically, people who use retail investing apps, like, public and the like. Individuals and they're making decisions. To, like, self directed, you know, and so Not not necessarily fun. Like but, like, retail is still, you know, the rich guy who has a JPMorgan adviser and stuff.
Speaker 8:That still counts as retail. Right? And, like, like, when you see know, you and I know it was first about 30%, then it was, like, down to 20% in terms of, like, retail allocation of it Yeah. Yeah. You did still see that, you know, at least, you know, sort of, you know, happen and don't labor.
Speaker 8:Like, you you you did still see that at the end of the day when these retail allocations happen these days, it still mostly goes to the good, wealthy customers of the big banks and their wealth management arms first. Mhmm. And that's why you saw, like, you know, the, like, retail brokerages that had some allocation, you know, ended up mostly giving people, like, one share and stuff. And that is because most of that 20% still went to, you know, the good long term customer with a very large account of JPMorgan and Merrill and whatnot. Right?
Speaker 8:So that is still the reality. And I think the main thing there is really is that, you know, the banks who are, in most cases, also, like, the ones who are underwriting the IPOs, you know Mhmm. They are kind of managing also the process. They will send it to retail allocation, etcetera. The most companies that go public maybe also don't really have the let's take SpaceX, etcetera, but, like, you know, most companies in the Smithsonian really have the perfect understanding of, like, the nuances in retail.
Speaker 8:And I think, you know, that's why you're still seeing that the the banks who are underwriting are, like, pushing their weight around. And at the end of the day, most of that still goes to, you know, the the wealth management customers and stuff.
Speaker 1:Can you talk a little bit about either the research that you're seeing folks do or maybe the research that you're enabling with Publix tools? Specifically, I I I read a very interesting in the Financial Times where they visualized over the next year how the lockup will actually play out. It's a very low float stock early on, gets added to the indices. And there's all these different milestones that I mean, could just say it's all priced in already, but I imagine that many investors will care and want to buy ahead of ahead of a index purchase, but after lockup ends or something like that. And I'm just wondering about, how you can actually help a investor understand those dynamics.
Speaker 8:Yeah. I mean, I don't have a perfect schedule in front of me right now. But first off, I think this IPO specifically that the banks likely have done a pretty damn good job, like, terms of the pop was there. It was sizable, but it wasn't ridiculous necessarily. You know?
Speaker 8:Even now on day two, like, the the stock clearly is holding up. And then the whole orchestration of the kind of multistage unlock of the of the float at the same time or or or the lockup in the same time where, you know, obviously, like, the whole renegotiation would be, you know, adding to the Nasdaq 100 and so on, which then creates more buy pressure on the other side as the other ones kinda, you know, get unlocked. And I think that orchestration, we'll see how it all plays out as it kinda really unwinds. But it's clearly very well thought out. And if you would judge the performance of that, you know, orchestration so far throughout this IPO and stuff, I mean, I would argue compared to many other IPOs, this has been very well executed.
Speaker 8:Right? So my Yeah. So lunch is that a lot of smart people have done some some some good work there that's I don't know if you can really play it like that
Speaker 1:because Sure.
Speaker 7:Sure. Sure.
Speaker 8:You know Yeah. There's surely smarter people than you and me that have Mhmm. Models that have all figured that out.
Speaker 2:So there's clearly continues to be more retail demand than allocation for these blockbuster IPOs. On one hand, Elon has benefited tremendously from like the power of retail. Right? It helps to have a bunch of people invest at like, you know you know, low two digit, you know, billions, you know, with Tesla and sort of ride that up. Right?
Speaker 2:But I feel like one of the challenges for retail to actually get meaningful allocation is just the lack of like reliability and the flipping risk associated with allocating to retail. I'm sure Elon in a perfect world would love to say like, yeah, we're gonna give half of the IPO to to retail but then there's there's gonna be that risk that people are like, you know, not as not as reliable as the big, you know, institutions and things like that or or certain even clients of the private banks that wanna make sure they're in the next IPO. So how do you think that that gets solved? Is there a world in the future where like, retail has, like, a true lockup? Like, they they cannot sell versus just saying, like, hey.
Speaker 2:Please don't sell. What do you think happens?
Speaker 8:Yeah. I mean, so as a broker, you you know, what's what what most brokers do and also what the companies who who IPO kinda ask for is just like, what's your flipping policy? And is that in most cases, if you flip within a certain time frame, you basically get restricted from future IPOs, and that's like one of the kind of forcing functions. But pure security is not perspective. You can't create this this notion where, you know, once the stock is common stock publicly trading, like, every, you know, every investor has to be treated equally.
Speaker 8:I mean, you can't then suddenly be like, well, I'd I like, don't trust you, retail investors, so you can't sell, but the other institution I sold it to, they they can. You know? Like, those things can't, like, can't really happen. But I think from a retail investor perspective, it really depends on, obviously, like, the the the at the end of platform in most cases. Right?
Speaker 8:So in our space, would also buy that up as, like, trading platforms, where they have that focus. Right? Trading platforms are, like, investing platforms. So, like, trading is basically, like, your chart based first product, technical analysis, very heavy options and futures and so on. And in that world, you do actually have a flipping culture.
Speaker 8:Like, there's Reddits about it. There's, like, you know, like, Telegram groups, etcetera, about, you know, where we basically, like, try to find multiple access points to an IPO just for the matter of, like, flipping it. But I would say that that is a small sliver of the retail market. Most people are actually more buying and holding. And what we've seen with IPOs in our history, our, like, net share retention on IPOs is, like, a 125% roughly, you know, which basically also means
Speaker 2:that people
Speaker 8:actually add to their positions afterwards. And so they get shares allocated, but didn't get everything that they wanted in the obviously, you know, so far always. And then, but then they add to it as it starts trading in the public markets. And I think most cases what you're seeing because, like, normal retailers, like, by the way, we're not traders. We are people who, like, build up portfolios for the life and stuff.
Speaker 8:Like, they are mostly people that are cold stocks. Right? And that's what you've seen also with, like, the diehard Tesla crew, like, in the past. You know? These people were people who were treating out pictures of, you know, their monthly DCA, their monthly dollar cost average into their Tesla stock because they got a new paycheck.
Speaker 8:You know? And I think that is the much more normal behavior, I think, than this tool flipping thing. So I think it's, yes, it exists, but I think it's a little bit maybe the fear is a little overstated, I would argue.
Speaker 1:There were a lot of people that were upset about SpaceX's inclusion in indices. They maybe they don't like Elon for political reasons. Maybe they don't like the stock because of the revenue multiple. There's a variety of gripes that people have. But I saw Jason Kalicana's fire back say, hey, you can create a synthetic index that, you know, you want to own the S and P four ninety nine.
Speaker 1:Just go do that. And it seemed a little complicated. How complicated is it actually to do that today if you're genuinely so bearish on SpaceX that it can't touch your portfolio? Because you could go short or you could just buy everything else in equal proportion, but then there's reweighting that happens and it's sort of complicated. But where are we from someone being able to just do that with a prompt or a click these days?
Speaker 8:Well, I love the question because I can perfectly now do a put an ad in here. So the simplest way is you just go to public.com, sign up, and there's something called
Speaker 1:gotopublic.com?
Speaker 8:Something called direct indexing. There you go.
Speaker 1:There you go.
Speaker 8:Fantastic. So and there's direct indexing, which basically means you can buy the S and P. You can customize them. You can be, you know what? I wanna have the S and P 500 without this and that stock.
Speaker 8:You can have rebalancing built in, even Texas harvesting built in
Speaker 1:Okay.
Speaker 8:Which means you can actually, you know, save some money just on, you know, take the the just on the
Speaker 1:Sell on the losers. Taxes there
Speaker 8:as well. Yeah. That's So selling the losers, you know, and Reboots. Rewaiting all the time. And so that is super easy now, at least in public, and is I it's it's something that that a lot of people do.
Speaker 8:I think the main thing that really was I think what a lot of people got upset with was that, people have trust in these indices
Speaker 1:Yeah.
Speaker 8:Because of the rigid frameworks that they have.
Speaker 1:Yep. Have to be profitable for a certain amount of quarters. Exactly. A certain size. Yeah.
Speaker 1:Totally makes sense. I understand the critique.
Speaker 8:So and so and so the minute it was basically like, oh, now we make an exemption suddenly.
Speaker 6:Think a
Speaker 8:lot of people were just getting upset with that. They'd basically be like, hey. What the fuck? Like, I put my my life savings into this Yeah. Because of these frameworks, and I have basically, like, you know, agreed to them or whatever, believe in however you structure it.
Speaker 8:And I think that was mostly what kinda came.
Speaker 1:Yeah. And also, like, when I think about the S and P 500, I think most people mentally think, okay. I'm gonna have point 2% in every company, but of course, it's cap weighted. And when you see a 2,000,000,000,000 behemoth come into the index, you're like, well, that could be like 3% of my portfolio, maybe 5% of my portfolio if it runs. And I don't want that index exposure necessarily.
Speaker 1:Of course, everyone has different risk tolerances, different preferences, but good to know that there's an alternative out there. Jordy, anything else?
Speaker 2:I was gonna say if if you have thirty more seconds to answer, how do you think the SpaceX IPO impacts how, you know, bankers and companies are thinking about, you know, potentially other IPOs this year? Obviously, retail's quite strong.
Speaker 7:Mhmm.
Speaker 2:They want exposure and it's at a level that is pretty
Speaker 1:And also the market, I felt like there was one narrative where it's like, if SpaceX wins, everyone else loses because there's gonna be so much rotation out of everything else, but the market's performed well today and stuff, and that would that that's not what's happened at all.
Speaker 8:Yeah. I don't know. I would argue there's so much money in the world that it's totally fine. I think when you put if look at the big institutions that put multibillion dollar checks into SpaceX, a lot of those were even, like, existing investors and so on. They kinda doubled down their positions and stuff like you know?
Speaker 8:And so I've I I wouldn't necessarily think of that argument. I do think that, because this IPO, at least so far, has been really executed quite well Mhmm. That it makes everyone very confident on the next ones. Yeah. And so, you know, if I would be now Anthropic or OpenAI or something, I I would I would like to look at this one now and be like, okay.
Speaker 8:Fantastic. The market is ready, and the bankers seem to be ready as well. Yeah. So I would say this is I would like would argue it's a it's a very it's good sign of general confidence and so on.
Speaker 1:White pill on a suit day. There you go. What else? Sorry. I cut you off.
Speaker 8:Oh, it's bad. Whatever. Hold Thank
Speaker 2:you so much. Great to see you.
Speaker 1:On the show. Always great to see you. We'll talk to you soon.
Speaker 3:See you guys.
Speaker 2:Great
Speaker 1:rest of your Goodbye. Let me tell you about Cisco. Critical infrastructure for the AI era. Unlock seamless real time experiences and new value with Cisco. Fox is buying Roku, the streaming service for $25,000,000,000.
Speaker 1:It's in the Wall Street Journal.
Speaker 2:25 or 22?
Speaker 1:25,000,000,000 in the Wall Street Journal here. Let me refresh the page, see if they updated it. It still says '25. Weird.
Speaker 2:All read reporting through 22,000,000,000.
Speaker 1:Oh, okay.
Speaker 2:Well, who knows?
Speaker 1:Somewhere in the north of 1,000,000,000, sub 100,000,000,000. Let's be very conservative with our estimates.
Speaker 2:Yeah. CNBC also 22,000,000,000.
Speaker 1:Okay.
Speaker 2:Weird that the journal is
Speaker 1:The journal may have inside information given that it's news corp property related there. Right? Anyway, let's read through the journal piece which might be well, I don't know. Let Go for it. Let me just give you some facts and then you can sort of give me some takes and and and contextualize it with more information.
Speaker 1:So Fox Corp said it's acquiring Roku in a deal valued around $25,000,000,000 So the Wall Street Journal is saying around? Is 22 around? Maybe. Making a major bet on the future of ad supported streaming. Ad supported streaming, obviously Netflix pivoted to ads after saying we don't know we're not going to do ads turned out to be a great business.
Speaker 1:Ads are undefeated and Consumers more people want
Speaker 2:down with ads.
Speaker 1:They're just down with ads, especially for good ads. Anyway, the Fox, deal. The deal is Fox's largest to date. It brings together a media company known for its live news and sports programming with the biggest provider of streaming platforms for connected TVs. It will add scale to Fox's streaming business, currently home to free ad supporting streaming service Tubi, which the company bought for 400,000,000 in 2020 and subscription based Fox One and Fox Nation.
Speaker 2:In addition to just Tubi, from my understanding, has been a home run.
Speaker 3:Yes.
Speaker 2:Like, you know, I don't remember exactly what the revenue is, but they bought it for 400. It's in the billions Yeah. Now.
Speaker 1:And all all the metrics about actual audience size Yeah. Are huge. And, yeah, putting up, getting to tens of millions of dollars in revenue, hundreds of millions of dollars in ad sales against a big audience like the Tubi viewership when you have the Fox machinery behind it makes a ton of sense. Yeah. In addition to distributing other streaming services through connected TVs and devices, Roku has its own ad supported Roku channel.
Speaker 1:The combined company will better compete with the likes of amazon.com and Netflix for ad dollars. Bringing these two companies together will really help define the future of television in The United States and in many other markets around the world, Fox Chief Executive Lachlan Murdock told investors on a call Monday, Fox will pay around a $160 per share, 96 in cash and 0.99693 Fox class a shares. The deal is valued at around 22,000,000,000 on an enterprise basis. Fox expects to fund the cash portion of the transaction with $12,000,000,000 in new debt as well as cash on hand. The combined company expects to cut around $400,000,000 in annual costs.
Speaker 1:Fox plans to keep 2B and the Roku channel as separate offerings. Consumers are increasingly opting for free and lower cost ad supported streaming options as the cost of subscriptions marches ever higher. Ad supported streaming plans now represent almost 50% of all premium subscription ad video on demand sign ups in The US, up from 39% just two years ago. More than a 100,000,000 global households stream with Roku, Roku's the largest streaming platform for connected TVs with 25% market share. Samsung's Tizen is number two at 23%.
Speaker 1:And then I'm sure probably Amazon's Fire TV is not far behind. Fox remained on the sidelines during the heady early days of streaming boom, pouring money instead into programming for its cable channels and buying up sports rights. It launched Fox Nation in 2018 and introduced direct to consumer Fox One, which includes sports and Fox News last year. Fox said last month that Tubi had nearly 100,000,000 monthly active users and its revenue had grown by 23% in the fiscal third quarter. And so Fox's stock is down today.
Speaker 1:Roku is down 0.2%, something like that. And the market doesn't like it. Take him has a take here. We can read through his opinion. He says, I don't understand how this Roku deal makes any sense.
Speaker 1:Bringing together the most valuable live
Speaker 2:I'll tell you how it makes sense.
Speaker 1:How does it make sense?
Speaker 2:No. So I think it makes sense. One, Fox, they have a a great product in Tubi. Right? It's again, there there are certain people that are that are happy with their with their HBO or Netflix or whatever, but Tubi has has a great niche.
Speaker 2:It's been a great acquisition Mhmm. For Fox, north of a billion dollars of revenue. That is a product. Roku is a platform. They have over 20% market share in connected TVs.
Speaker 2:I was looking at the data. They have over 40% of the engagement with connected TVs. So when you think about it from an advertising potential, it's not just that they have 20% of the connected TV market. They have over 40% of like the watch time effectively. Right?
Speaker 2:So looking at the potential from an advertising standpoint and how many dollars are still yet to shift from traditional television to connected TV. So from that lens, I think it's I think it's great. Roku is also a much younger demo. Like a lot of media Mhmm. Lot of media properties, right, especially television related are gonna be, you know, older demos that are that are eventually gonna be aging out at least of like prime consumers.
Speaker 2:But these are consumers that are in their, you know, prime earning years, prime years as consumers. And and so ultimately, I think it makes sense. I think it makes sense for for Fox. Next, the thing that I hope that they can do as a consumer is rebundle. Right?
Speaker 2:We've just gone Mhmm. We've gone through this era of of unbundling Yeah. And the fact that you got a new TV and you're like, okay, great. Let me log in to, you know, fifteen, ten different services, something like that. I would like to see them do I would like to see them do something in bundling for for a consumer.
Speaker 2:So again, looking at it from the lens of like having north of 40% of like watch time
Speaker 1:Yep.
Speaker 2:Right? That is a super valuable property property and like with the right ad driven approach, I think I think it'll pay off.
Speaker 1:I wonder how windowing fits into this. Like, I I when when I grew up, I didn't have cable, but you would get a prestige movie played on ABC like once a week. And for a while, that was the flow on Netflix. And HBO was like its own premium subscription. You could open up the HBO app.
Speaker 1:It's all premium series and movies. And then some of that would trickle down, but then it feels like the ecosystem sort of branched a little bit where Netflix stopped getting, like, the James Cameron library for a while. And Disney started hoovering up some of that, keeping some of the really popular movies, the Marvel franchise, off of Netflix, even for later run a year or two after, because there was more competition from the actual different pieces of the different studios. So I wonder if Roku will be able to to provide some sort of like neutral territory in some ways where where viewers can pick up something that's in the premium end, some things that's, you know, a sequel to a franchise that they know and love, but it's not seen as as competitive as as, you know, Disney versus HBO or whatever. We'll we will see.
Speaker 1:The history of Roku is interesting. We gotta take you through this briefly. So it was founded by Anthony Wood, born in 1965. In when he was a teenager, he published Lunar Lander in the Ahoy magazine, earned a bachelor's degree in electrical engineering from Texas A and M. He met his wife there.
Speaker 1:Now they have three children. Congratulations. They live in Palo Alto. But in college, Wood founded his first company, AW Software. AW Software.
Speaker 1:Do you think the AW stands for? He's putting his name on the line.
Speaker 2:On the line. Andrew Wood I got meet Anthony recently.
Speaker 1:Oh, you did? Yeah. Wait. Really? Yeah.
Speaker 1:No way. That's awesome. So he was selling computer programs. He founded Sunrise Industries while studying engineering, developing software for the Amiga, the original Amiga system. After graduating, he founded his I think this is his third company and it's called Sunrise Version two.
Speaker 1:Later in 1995, he launched another company, iBand, and iBand sold to Macromedia for $36,000,000 in '95. That's a lot of money. And Macromedia, of course, was the makers of Adobe Flash. He left in 'ninety seven after two years to launch Replay TV, which was a digital video recorder DVR for you'd have something coming in over the antenna and you would be able to record it and watch it later, much like TiVo. TiVo was their main competitor.
Speaker 1:He in 2002, he founded Roku, his sixth startup to market home devices. Roku means six in Japanese. And he's just like, it's the sixth time I'm doing this. Imagine being on the sixth startup. I'm Grind number four or three or something like that.
Speaker 1:Also worked at Netflix. The Roku history is sort of interesting. So he founded Replay TV. Replay TV did not was not successful, so he worked at Netflix. In 2007, Wood's company began working with Netflix on Project Griffin, a set top box.
Speaker 1:Netflix was thinking about getting into hardware and it would allow Netflix users to stream Netflix content to their TVs. Like, they were working on, like, the Apple TV, basically. They it was a crazy fork in the road. A few weeks before the project was due to launch, Netflix's founder, Reed Hastings, decided that it would hamper license agreements with third parties. It was all of our third party license agreements, they're giving us content.
Speaker 1:They're gonna be super upset about this. We're shelving this product. We're not doing it because we we want to keep Netflix on all the other platforms. When the Apple TV comes out or whatever other boxes out there, we want Netflix there. We don't want Apple cutting us off because they say, oh, you got your own box.
Speaker 1:You can live over there. You're not on ours. Not that Apple would necessarily do that, but that type of set top box would not integrate, or the smart TV would say, are not integrating. Yeah. And so Fast Company cited the decision to kill the project as one of Netflix's riskiest moves.
Speaker 1:Netflix then decided to spin off the company and Roku released their first set top box in 2008. In 2010, they began offering models with with various capabilities which eventually became their standard business model. And so, they went on and on and wound up as a very successful company now Yep. Owned by Fox as long as the steel Yeah. Clears.
Speaker 2:Overall, real platform.
Speaker 1:Yeah.
Speaker 2:They already have a product that sits on top of it. Tons of of advertising potential and I I I think that regardless of whatever the market reaction is today, I expect that people will will get it over time.
Speaker 1:Well, Roku is ad supported and we are too. So let me tell you about Console. Console builds AI agents that automate 70% of IT, HR, and finance support, giving employees instant resolution for access requests and password resets. Tyler Cowen shared some more thoughts on the recent mythos, brouhaha. It's a good term.
Speaker 1:We this was all over. We talked about this earlier, but he says, according to not yet confirmed but likely true reports, it was shown that the model could be jailbroken. There's debate over this now. The released mythos already restricted bio and AI improvement queries rather than strictly in fact rather strictly in fact. So now we are back to the model not being available.
Speaker 1:Here are a few of the constraints on the U. S. Government, not the only ones, I might add. One, it needs for the main companies to stay in business. On top of that, it wants their IPOs to go reasonably well.
Speaker 1:And it's now much harder for the top companies to recruit foreigners, which is a significant share of their highest quality workforce. Demis, Ilya, Andre, for a start, are all are all international engineers. It is much harder for the main competitors to drum up foreign business in a credible manner and sustainable manner. That's interesting. We haven't seen many breakout charts of how much revenue is domestic versus international, but we have seen reports of OpenAI and Anthropic doing big deals with international companies.
Speaker 1:Some of these companies, Fortune five hundreds, they just have global footprints, so they gotta use the models everywhere, ideally, unless they do all of their software engineering in Silicon Valley. One b, how are American multinationals operating abroad supposed to use top systems moving forward? That's literally what I just said. I just predicted the next line. Whoops.
Speaker 1:I am a am a stochastic parrot. It wants to use model access as a tool of both hard and soft power. So model access has to be possible at some level. But it is very hard to control what foreign agents will do with partial model access when they get it in the future. Three, The U.
Speaker 1:S. Needs to stay ahead of China in the AI race. This is a big question. We have Aaron Ginn from Hydrohost joining in just ten minutes. We'll ask him for his perspective on this.
Speaker 1:Four, The US needs to issue restrictions that are actually enforceable, and US citizens only doesn't fit that bill. That's a good point. You might have some KYC, but it's very difficult when these APIs leak into other products. All of a sudden, you're prompting a model within a piece of SaaS. We've seen this with you go to Slackbot in Slack, Salesforce product.
Speaker 1:There's an AI model under the hood that's vended in by Anthropic or OpenAI depending on the deal, depending on the product. And that now needs to be passed along to understand, is this a U. S. Citizen on the other end of the line? Let's find out.
Speaker 1:Furthermore, markets and everything, he it is easy enough to hire a traitorous American to access tools of wrongdoing. That's a really good point. How can you verify that every American is is loyal? Or for a matter, it is not that difficult to fake citizenship in various ways.
Speaker 2:Yeah. There's been there's been people over the last fifty years that have gotten caught, like, passing on or basically selling, you know, secrets around our Yeah. Various military aircraft Yeah. For example.
Speaker 1:Yeah. There's a very controversial story of Virgil Griffith, cryptocurrency researcher, who I actually met once. He worked at Caltech, was deep in math, and very excited about cryptocurrency. And he went and gave a talk on cryptocurrency in North Korea, explaining how cryptocurrency works and how crypto cryptography works. And that was seen as a violation of export controls, he was sent to prison.
Speaker 1:And the crypto community is very upset about that because they they maintain that math should not be illegal. This information should not be illegal. The the government side is defense
Speaker 2:was he like thinking that he was gonna liberate the North Korean people by giving them access to effectively or explaining how code
Speaker 1:Can be used to create a store of value that that is that is unsanctionable essentially. And so it was seen as a violation violation of sanctions by the US government. And and more importantly
Speaker 2:Do they have North Korean stable coin?
Speaker 1:I don't know. I don't know. They had a lot of
Speaker 2:the most sanctioned stablecoin. Potentially.
Speaker 1:This one, number five by Tyler Cowen, was a little bit controversial. He says the US government cannot nationalize these companies and then proceed to run them effectively. And people are debating that, saying that it might be possible for the US government to to own the labs in some way and and and leave them to their own devices to actually roll these things out. What do you Yeah.
Speaker 4:I mean, if you're like super RSI pilled, right, you don't need the employees at all because because the AI just improved
Speaker 1:the system. Government just says continue to improve? Yeah. That's it. So you don't actually
Speaker 4:you know, the the extreme scenario.
Speaker 1:Yeah. Yeah. And then and then on the other side, it's that, okay, these systems are actually extremely complex. You look at the uptime of some of these systems, the research taste. In fact, you need so many employees to make these products effective.
Speaker 1:You actually need the international employees as well because they come up with great ideas. So, yeah, those are the two sort of sides of the debate. Six is Chinese and open source models do in fact improve at some reasonable pace even though they are right now considerably behind the best proprietary models. And that's something that I want to dig into more. It does seem like the pace of open source development in China is slowing.
Speaker 1:I'm not entirely sure what's driving it. It feels like there's a number of different things. Gavin Baker said it's about compute and they're turning their backs on the Blackwells that they had the opportunity to buy. I think it might be research ideas that are more locked down now in tighter controlled circles in San Francisco. It also might be the data.
Speaker 1:It might be, but you'd have to imagine that they have lots of people that are writing code, lots of people that are inferencing those models and then full data and information capturing of those rollouts. There are a number of different reasons why that pace might be slowing. And we'll see. Maybe there's a big jump in the graph. Maybe we have another deep seek moment in the next couple months.
Speaker 1:We'll see.
Speaker 2:It's I think everyone should expect some type of update, hopefully, today from from Washington or Yeah. Or both. Hopefully today. Yeah. Anthropic had originally said I think twenty four hours.
Speaker 2:Mhmm. Obviously, a lot more time has passed but Yeah. Partially due to the events of the White House Lawn yesterday. Things a little bit harder. Well, before go One person potentially impacted is railway.
Speaker 1:Railway is the all in one intelligent cloud provider. Use your favorite agent to deploy web app servers, databases and more while railway automatically takes care of scaling, monitoring and security.
Speaker 2:Who was impacted? One person potentially impacted is Carpathi.
Speaker 1:Okay.
Speaker 2:Theo went to Google and said, is Carpathi a US citizen? And AI overview seemingly pulled went to Grok and said, according to Grok, Andre Carpathi is EB one extraordinary ability green card recipient, not a US citizen.
Speaker 1:This is a loop. Is a loop. Loop from Gemini to Grok and back, and then it goes back into Grock now because the screenshot's been shared.
Speaker 4:This is RSI.
Speaker 1:This is RSI. For sure. For sure. Where where where next, Jordy?
Speaker 2:What else do we have?
Speaker 4:We've talked about Le Chateaune.
Speaker 1:Le
Speaker 4:Chateaune.
Speaker 1:Le I
Speaker 4:think that's how you pronounce it.
Speaker 1:Okay. Yes. Take us through this. What's going on?
Speaker 4:Well, yeah. So there's rumors. I I think this has not been formally announced by Mistral.
Speaker 1:Yeah.
Speaker 2:Formally announced by a bunch of teapot schitzos, though.
Speaker 1:So in closing, Tyler Cowen called out Mistral specifically. He said rising in status, Mistral, AI nationalism, proponents of slow takeoff is the likely scenario, reticent, quiet CEOs. But he calls out Mistral as a potential beneficiary of all this government chaos, government restrictions, closing down. And so what's going on? What is Mistral's released many models.
Speaker 1:They've done their actual pre trained. They're not doing fine tunes on Chinese models. Correct? And and and it's been a good product. Like, it's been working.
Speaker 1:They've been raising more money, but they've never been seen as one of the leading frontier labs. Is that the general tone?
Speaker 4:Yes. I think that's correct. I I think I mean, very early on, I think they were like, oh, this is maybe one of the frontier labs. Right? It was all, I think, ex meta researchers.
Speaker 2:Mhmm.
Speaker 4:But, yeah. There's the new model, you know, is it real? Technically, no. Mhmm. But, you know, perhaps in the future, some of the the founders are vague posting.
Speaker 4:Maybe they will actually release a model called
Speaker 1:Let's go through some of the vague posts.
Speaker 2:All I know is a lot of Americans have ever since ever since this new model started being talked about. A lot of Americans that maybe formerly had some type of beef with France have been real quiet. Yep. Yep. Real real quiet.
Speaker 1:Well, people are having fun with the fat cats, Arthur Mench. This is a fake screenshot, I believe, but TensorQT shares the death star with the cat on it. And then Shashank Goyal says, is now number one on open router. Need to urgently fix our. Axes.
Speaker 1:And he actually He's works not really
Speaker 2:helping the confusion.
Speaker 1:He actually works Because yeah. Chart, it has a break in the chart because it goes so high that it's off the charts. Fat is crushing it. I like I like a I like a friendly hype hype cycle.
Speaker 2:This is great. Says
Speaker 1:thought we had more And it's a fake in in it's a fake image, but it says the French government citing national security authorities has issued an export control directive to suspend all access to by any foreign national, whether inside or outside France, including foreign national employees, the net effect of this order is that we must abruptly disable for all of our customers to ensure compliance. It's a direct copy pasta from the Anthropic Post, of course. And Gary Marcus also says, I got early access to Chateaune, and it's terrifying. I was wrong about everything. Of course, Gary Marcus has been skeptical that LLMs will deliver AGI, ASI, RSI, whatever you want to call it.
Speaker 1:Wherever your goal posts are. Gary Marcus says LLMs are not the direct path. And so the joke here is that Le Chaton updated his
Speaker 2:Does anyone notice Le Chaton fat got quantized lately?
Speaker 1:Yes. People were also saying mythos is a distillation of le chaton fat.
Speaker 4:Yeah. There's there's various rumors around.
Speaker 2:I think the the accelerate harder says you can really tell who has early access to le chaton fat and who does not.
Speaker 1:You know, like like, the the the butt of the joke here is that, oh, like, like, can't possibly be on the absolute frontier. But this this is just good vibes. Like, like, it's showing that they are the leader in France for sure. Totally. They're they're getting a lot of attention.
Speaker 2:Still have mind share.
Speaker 1:Yeah. Growing the valuation, delivering something and now people are gonna check out this model and see what it can do and it's certainly it it like, people wouldn't be making this joke if Mistral had, you know, been, like, completely languishing, not doing anything, not making any progress. Like, this is a sign of of some healthy attention. I can't tell if this is a joke anymore, but NVIDIA's reportedly in in talks with Mr. All AI to supply €1,500,000,000 in compute per month to help support the demand for fat and le chaton That
Speaker 2:is a joke. That is a joke.
Speaker 1:I mean, Nvidia
Speaker 2:It's all fake. Probably do. All fake except except the vibe is real and it's amazing.
Speaker 1:You can tell who has early access to le chaton fat and who doesn't.
Speaker 2:Other news, the prime minister of The United Kingdom has banned social media access for under sixteens. He says, these days kids must find their feet in a world where technology intrudes into every area of their life. I just can't let that go on anymore, so we're giving children their childhoods back. Let's play the video.
Speaker 1:Very interesting. Kier Starmer. Right?
Speaker 9:Every parent wants the best for their kids. That's what being a parent means. And for me, for my two kids, all I've ever wanted hand on heart is for them to be safe and for them to be happy, and the rest is up to them. But you know, I think back to when I was growing up and I have to say, I think we had it easier. These days, kids have to find their feet in a world that changes so quickly, where technology intrudes into every area of their lives, and we know that harms them.
Speaker 9:The response from parents in the consultation has been absolutely clear. Thousands of parents say their children are addicted to social media. It can leave them trapped in a cycle of endless scrolling that displaces play, sleep, and time with the family. It can harm their mental health. And frankly, parents need our support on this.
Speaker 9:That is why today, the government has decided to ban social media access for children 16. It's a big step
Speaker 1:for our country. If you're 16 in
Speaker 9:The UK. It's not an easy
Speaker 2:It's been a
Speaker 1:good run. I'll be honest with We exist on social media. Think We haven't rushed to know. RSS feeds are those social media?
Speaker 9:Carefully at the evidence.
Speaker 2:Imagine if turn okay. So so we can
Speaker 1:have to we have to print every episode's transcript as a book and mail it children's bookstores. Every every episode of TBPN needs to be transcribed
Speaker 2:It works because there's no square.
Speaker 1:On paper and delivered to children's bookstores.
Speaker 4:Fly plane over The UK and then drop
Speaker 1:a massive leaflet campaign. But every So every episode is a 50 500,000 words, so it just hits the ground like that every every week.
Speaker 2:So so what's gonna what's gonna happen? They're gonna require they're gonna require major social media companies to require ID verification for every user. Okay. There's potentially a bunch of, you know, issues with that, especially given that there's a sort of raging debate around free speech Mhmm. In The United Kingdom and Yeah.
Speaker 2:Bunch of issues related to that. And so that that a lot of this again, I I will happily say that I I'm I look forward to trying to get my children to not use social media as long as possible. Mhmm. I don't I don't think it's I don't think it's good for anyone's mind, much much less the mind of of a child. But there's a lot of issues here.
Speaker 2:One, the other thing with vibe coding is like literally anyone can make a social media app with like one prompt now. Right? And so my expectation is this is not really gonna work. And one of the
Speaker 1:I think it's power law though.
Speaker 2:Yes. But but imagine being a kid and being and that's been you're 15 years old right now. You've been using social media for
Speaker 1:I I I mean, truthfully, like, if a kid goes and vibe codes a social network and sends it to, like, their five friends, like, yeah, that might violate, user account logins. It might be like a social app, but that feels like way chiller and not a big deal to me. Like it feels like the spirit of the law is like held there. Anyway Yeah. We we can come back this in the
Speaker 2:Yeah. I just I just don't I just think like there will be a new social network later tomorrow that gets hundreds of thousands of users because social media is inherently viral. Because they all yeah. Yeah. But but again, like, these things pop up.
Speaker 2:I mean I remember I remember there were
Speaker 1:social If you if media you have like okay. There is a million dollar penalty for delivering a social media experience to someone 16, then if I'm a vibe coder, first, the model's gonna say, hey, what you're doing violates UK law. I can't help you. Or they'll say, are you sure you wanna do this? Because like that's risky.
Speaker 1:And then you do it, and then you just get the fine, and you're like, I'm shutting down. Why would I keep doing this?
Speaker 2:Yeah. But there's gonna be plenty I mean, there's there's I don't I don't I just
Speaker 1:wanna do on this.
Speaker 2:Information flows. One and and and the only other thing is people have had every issue with like Metas like trust and safety. Right? Mhmm. But for everything that they do is that is bad Mhmm.
Speaker 2:They do probably a million good things. Right? Like taking down content Sure. That shouldn't be online. Stopping abuse.
Speaker 2:Things like that. And so I'm just very interested to see how this plays out. I think that kids are gonna find a way to gather online no matter what the law says. Yeah. You know, maybe it's in the comment section of like the Financial Times, you know?
Speaker 2:Yeah. They'll turn they'll turn that
Speaker 1:to so the the the definition that The UK is using, they're using the Australian model. It's not anything with accounts and comments. It's user to user platforms whose purpose is to enable social interaction where users can post material and where content is distributed alongsidethrough algorithms. So you got to have an algorithm is there. They explicitly named Snapchat, TikTok, YouTube, Instagram, Facebook, and X.
Speaker 1:And so the working definition is basically a social app where users post content to other users, interact socially, algorithmic feeds, shape distribution. So messaging services like WhatsApp signal are not affected. So anyway, we can dig into this more. I I think we have Derek Thompson coming on this week.
Speaker 2:Mad everyone's sharing, you know, homegrown reels in that they're making in their own homes.
Speaker 1:Yeah. Why not? Imagine. That seems more healthy than I don't know. That seems like it solves the problem that they're going after.
Speaker 1:If they think it's a problem, they it's fine. Anyway, we have Aaron Ginn from Hydra Host. He's the CEO and cofounder. You know him. You're welcome.
Speaker 1:Aaron, how are you doing? Been too long. What's up?
Speaker 3:Yes. It's been a while, man. I miss David Cameron. So that that's why that's why I take away from that. Yeah.
Speaker 3:Oh, really? Tory, yeah. They're they're Tory, they're a mess, but yeah.
Speaker 1:Yeah. Yeah. Well, mean, have you been grappling with the phones, fertility thing, the social media thing? Like, where do you stand on all that?
Speaker 3:I mean, one, most of the longitudinal studies, they actually can't normalize their control for most of the stuff versus, like, already predisposed behavior.
Speaker 2:Sure.
Speaker 3:And then like you already were existingly depressed and accelerates the depression, similar with like alcohol and other things like that. Sure. But but but the second is that this is gonna go the way of the eighteenth amendment. Mhmm. Because of the Geico Jordi said, which is like, but the world is flatter than it's ever been before.
Speaker 3:Mhmm. Just like the model stuff with Anthropic. Mhmm. It's like it's like, okay. So we make a big deal about this, but then 06/2005 China already has it.
Speaker 3:So, like, what's the point of this? And and and I think that that's like I I like the intent, but the intent should be, like, empowering parents to, like, educate their children and and empower them to control
Speaker 1:Or choose.
Speaker 2:Yeah. We should do do it. Even a curfew feels more enforceable or, like, enforced screen time, which is, like, you get thirty minutes a day on social media. Mhmm. Like, that feels, like, easier for the platforms to actually enforce than or the country to enforce than, like, a a total ban.
Speaker 3:Yeah. But but this this should go the normal trajectory of how technology gets adopted. There's always a late stage of regulation. And and for, like, GPUs, you know, like, or the reason why the UK government is so aggressive on sovereign AI is because they wanna do similar things to to, like, what this is. And and I I think that that trend is a little bit onescapable because in The UK, you have the right to do that.
Speaker 3:Like, they're they're a sovereign country. You can regulate how you wanna regulate. And then the latter component is that if if you think about the kind of how this whole space has flushed out, well, like, has enabled our business and why we just, you know, closed a very large series a. How much? A $100,000,000.
Speaker 3:$100,000,000.
Speaker 2:Yeah. Yeah. Know. Right? Right.
Speaker 3:So I appreciate that. I I have a gong in mind whenever y'all had your successful Fantastic. Acquisition. I rang my little I rang my little gong three o. So, yeah.
Speaker 3:Of course, man. The Did you did you
Speaker 2:prime it? Because we've been getting a lot of critiques online. People said you didn't prime the Gong. Yeah. And I just thought you'd come in with the hardest possible hit.
Speaker 1:No. I'll show you. I'll show you. Do you five priming strikes and then the real strikes. So you go
Speaker 6:it's prime. Now
Speaker 2:it's prime. Okay. And now the
Speaker 3:real hit
Speaker 1:like this. That's how you prime the gong before you strike it. This is the way you do it. We learned this from the commenters who said we weren't warming it up.
Speaker 3:Hey. I'm I am pro appropriation of my culture. So, like like, this this is this is always a pro for the Yeah.
Speaker 2:You brought us you brought us you brought us hats that I didn't even I didn't feel comfortable wearing because it they just
Speaker 1:I thought he was talking about I that's totally GPU whisperer culture, whispering to the GPUs.
Speaker 3:The the I mean, literally, my dad gave me this on my desk. So, like, this holds my phone. Cute.
Speaker 1:Love it. So So $100,000,000. What what is the distribution of that? I mean, are you gonna be buying a lot of GPUs? You're working with NVIDIA.
Speaker 1:Is this, like, one multiple data centers? Are you part are you building, like what restate the thesis of, like, where you fit in the bottleneck?
Speaker 3:Yeah. The so, no, we're not using any of the money to buy GPUs.
Speaker 2:Oh, no.
Speaker 3:We are an asset light company.
Speaker 2:Yeah.
Speaker 3:I believe we hold the title of the only Neo Cloud in NVIDIA's Orbit that is a software company. Mhmm. So we we manage GPUs. So we provide an operating system for the data center Mhmm. To where any data center in the world can become a Neo Cloud.
Speaker 3:Sure. We're already in almost two dozen countries, close to 60 data centers.
Speaker 1:Yeah.
Speaker 3:And we have, let's say, several billions in contracts that have been signed Yeah. For us to continue this project. So so that's why Sovereign is a big customer of ours. You've got to think that, you know, is is a US company really going go try to build a data center and supply in England? Mhmm.
Speaker 3:Or are they just going to rent from somebody in England? Mhmm. Then you then come you know, add the layers of now we're on social media, but this is clearly gonna be applying to GPUs. Yeah. Then you can see how this all kinda all flows out where data residency in nation states is gonna be a permanent fixture going forward.
Speaker 3:Yep. And and then that's not me approving that or wanting that. Like, I just I just think that that's just where we are right now. And and then you then add the continuous layers to that of, like, well, what is AI gonna work on? Health care, education, defense.
Speaker 3:Already all those are nationalized industries, it means other countries. So in summary, public cloud is dead, and NVIDIA in their all the other accelerators are basically are applying a ton of free cash flow to that same argument. And so we're the software that enables all of that to work together.
Speaker 1:How much of your thesis is like you want to stay NVIDIA only, you want to compound the learnings around the NVIDIA ecosystem, there's value? Like, we talked to another, a a Neo Cloud last week that's AMD super focused. But then you talk to other folks, they're like, we wanna be completely agnostic. We wanna be, you know, one big blob of fluid compute. There's multiple thesis, that are playing out, people are sort of testing every idea.
Speaker 1:But how do you see it? Like, what is your strategy?
Speaker 3:Yeah. So our our software works with with any OEM or or ODM. It's intentionally designed that way. But, of course, like, the capacity in our data centers reflects exactly what the market demand is.
Speaker 1:Yeah.
Speaker 3:And the videos is just the best. And and, yes, I I do think that there is a place for not necessarily the hyperscaler chips. I think that that market is pretty narrow. I think it's probably five customers that actually would ever buy that. But the rest of the kind of alternatives
Speaker 2:Yeah.
Speaker 3:They're they're all gonna be designed for very specific use cases. But if you're in a market where power is gonna continue to be constrained, data center speed is gonna be you're gonna pick the most like, you're basically always gonna pick the Porsche Cayenne Turbo over and over and over again. You want to put your kids in it. GT. You wanna put some stuff in the back.
Speaker 3:Yeah.
Speaker 2:You mean the GT.
Speaker 3:And you want to go fast. You wanna go you want to go fast or or or or Mercedes
Speaker 2:Live bus.
Speaker 3:Station wagon. Right? The AMG station wagon. Right?
Speaker 2:Yeah. That's good one. Classic.
Speaker 3:So that's so that's yeah. So that's the NVIDIA play. Right? Is that I'm the best. I'm expensive, but I can do everything you wanted me to do.
Speaker 3:And ASICs and TBUs, etcetera, they're very they're like, I'm getting a motorcycle. I'm getting a Skoda.
Speaker 1:Yep.
Speaker 3:And the market will eventually get there, but in a world cross where
Speaker 1:cabri cross cabriolet. Yeah. So React to what Gavin Baker just told us in the show earlier. I asked him about it looks like the trend lines are widening between The United States closed source model capabilities and Chinese open source model capabilities. There's a bunch of charts that show one line is growing linearly, the other is growing exponentially over time.
Speaker 1:That could be really good for America. It could mean a lot of different things. They could catch up. Who knows? But he was saying that the big reason for that is that Blackwell is a great chip.
Speaker 1:They've had the ability to buy it, and they've turned their back on NVIDIA even though Jensen and NVIDIA went to Washington and figured out the correct framework to allow for exports. Those exports have not been received on the other side because of the push to build an indigenous supply chain. How strong is that narrative for you? What would you add to that?
Speaker 3:I think on one of my last op eds and appearance of the show, I told Dale that was gonna Mhmm. That that China was going to basically reverse ban. Okay. They because and that's why I wasn't really that concerned about the initial kind of pun. Yeah.
Speaker 3:Because that that wasn't actually the goal. It's it's Yeah. Again, y'all like y'all both know my disposition is I love this country Yep. And I'm happy my family came here. But there's a kind of under appreciation about how actually Chinese people think and what their goals are as society.
Speaker 1:Mhmm.
Speaker 3:So the I agree with Gavin's kind of you know, listen to him on All In Yeah. This other podcast. Like, Yeah. He's very aligned with kind of our thesis about global compute. Sure.
Speaker 3:The the the one thing that I would add as a caveat, like, the question is, like, does it matter? And and that's what we don't really know is that that if if we're in the market as customers and that's think probably all three of us has at least some German car.
Speaker 1:Sure.
Speaker 3:Then other models of German cars are very interesting to us. But if China doesn't care because it buys Toyotas, it buys Volkswagens, it buys whatever, like, end stuff, then it's just it's just a different way of understanding the preference theory of another country. And and currently, I think the safest assumption that we should have as Americans is that it doesn't matter to them. Mhmm. And they because it could be 80%, and that's all it needs to be.
Speaker 3:Mhmm. And if you look at the history of CCP policies, everything from environment to manufacturing to buying stuff from TBPN, it seems like the consistent strategy is that 80% is good enough. Mhmm. And and the the one thing that we do have to be very careful about, which Stack does talk about pretty religiously, is that they are winning on the adoption side. Yeah.
Speaker 3:And and every kind of arc of innovation that has happened in in the world, like previously AI, America has won the several stages of the, like, industrial revolution to other phases of the Internet because we are first to adopt. And China clearly is the first to adopt on robotics, on drones, on AI integration, and and that's where maybe they figured out it doesn't matter. Like like like, they can solve it via other mechanisms like dirty power, inexpensive chips, and they can kinda go their own their own trajectory. Mhmm. So so, like, you know, I'm I'm with the administration on on the changes that they've all implemented.
Speaker 3:I I would say that the Friedberg's kind of last rant last week was definitely echoing, like, my view on things, which is, like, the the government always thinks they can do something about something when they're out or they can't. And then they spend a bunch of energy, and then at end of the day, doesn't work, and then they still claim victory. Like, world poverty is a great example. Yeah. And and and so I feel like that's where we're gonna end with AI where in the end, it kind of, like, all this effort really didn't matter, and it caused, you know, entrepreneurs to slow down.
Speaker 3:And eventually, the government backs off and realizes that we have to, to quote David Sachs, you know, let America cook.
Speaker 1:Yeah. Is distillation a bigger problem than chip exports?
Speaker 3:I I think most of that's overblown, and it's just kind of hard to prove. Yeah. I I think I I think it's actually quite hard to prove. And and and I I also believe there is this kind of the
Speaker 2:model will just tell you straight up that it's It's clawed? Yeah. For example, three.
Speaker 3:Yeah. Like that. Like, I I I don't doubt it. Like, I'm I'm not to be clear. It it totally just happened.
Speaker 3:The question is, like, how much does it matter? Yeah. Right? Like like, the and and I think a lot of it is oriented towards the fact of, like, underappreciating the fact that Chinese engineers are actually amazing that that this that I just brought. And I think it's kind of all coded with that.
Speaker 3:They're like, oh, if they're copying us, somehow they can't do it themselves. Mhmm. And they have proven over and over and over again they can. Yeah. And then you then go into the fact of, obviously, coding is now universally accepted as a wide adoption or, like, you know, the first CSA foothold for AI.
Speaker 3:Mhmm. Well, that's because it was also the most widely used by the customer base, and it has a, you know, a firm yes or no answer. So now you see China, which is using kind of grade b models currently, but accelerating in its adoption. Like and it, you know, doesn't care about the what things that we care about in terms of everything from formality to safety and things like that. So, of course, they're going to be able to find use cases and things that we didn't understand.
Speaker 3:And and then that that's that's something we, as Americans, have so far deeply underappreciated. And and you can see that in the poll numbers where data centers are more unpopular than nuclear energy.
Speaker 1:Yeah.
Speaker 3:And and that's a quite scary place to be, which is why the kind of, I think, end arc of the data center business is actually gonna mimic the oil and gas business where they the reason why fracking became this great energy revolution and why we became the number one exporter of oil and gas in the world is because oil and gas companies pay off owners of lands.
Speaker 1:Yeah.
Speaker 3:So that that's just what the Forever too.
Speaker 1:I mean, you have a small piece of land that they're fracking on, like, get a check-in the mail. Yeah. That's right. And and that's starting to happen. I I I there there's a
Speaker 2:Sounds like Brad is working on something.
Speaker 1:Oh, with the Trump accounts but also I
Speaker 2:mean No. Not even he was sort of teasing like we have something Yeah. Like around like because we were just saying why would you want to center in the backyard if you can get if you can use inference from, you know, somewhere in another state. Right? Makes sense.
Speaker 2:Tyler just wanted to say hi. It's been a minute.
Speaker 3:Oh, yeah.
Speaker 1:There we go. There's the hat.
Speaker 3:He kept the hat.
Speaker 2:Yeah. Oh, of course, we kept of course, we kept the your gift. We would never we would never it's it's here always in the office.
Speaker 1:It's on our hat rack with a space helmet, hard helmet.
Speaker 2:Cowboys hats, unicorn heads.
Speaker 1:Howard Wiggering thing.
Speaker 3:Oh, that's so great.
Speaker 1:Anyway, thanks so much for taking the time.
Speaker 2:Yeah. Congrats on the milestone. To see you.
Speaker 3:Yeah. Thank you. Let's see. It's been
Speaker 1:too long. Let's do this again soon. We gotta chop it up on all sorts of things. This is always a great time. Have a
Speaker 3:good one. Yeah. Absolutely. Yeah. And congrats to y'all too.
Speaker 3:God bless y'all y'all definitely out of the few entrepreneurs I know, man, like, was very happy for y'all. Y'all deserve it.
Speaker 2:Thank you. Thanks, Aaron.
Speaker 8:We'll talk
Speaker 2:to you soon. Yeah. Congrats again.
Speaker 1:Yeah. Let me tell you about Figma. Agents meet the Canvas. Your AI agents can now create and modify your Figma files with design system context. And our next guest is here with us live in the TBPN Ultra Dome.
Speaker 1:Rafael, welcome to the show. Please introduce yourself for everyone at home first.
Speaker 7:Rafael Vivas helps with AppLovin. Yeah. AppLovin is the largest mobile ad platform platform that you may or may have not heard of.
Speaker 1:Let's put this
Speaker 2:I think everyone on X knows. I feel like your guys is you guys have like a 100% saturation at least on our corner of X.
Speaker 1:Yeah. I feel like some people learned like forcibly because they were like, hey, what's going on with this business? Came out of nowhere. Like, wasn't I don't know. It wasn't like super noisy and then people were skeptical and then you kind of proved all the haters wrong again and again.
Speaker 2:Not not a venture story. Right?
Speaker 7:No. Not at all. We couldn't even raise a dime in Sand Hill. I think Adam was willing to give away 25% of the company out of 5,000,000,000 cap way back in the Wow. And now the company is worth a $180,000,000,000.
Speaker 5:We've done pretty well.
Speaker 1:That's crazy. 25%. What what was as you tell the story, what was the key to get from 5,000,000,000 to where you are today?
Speaker 7:The big thing for us has really just been the model. Right? The great thing is in the world of performance marketing, advertisers don't have incremental costs typically to bring in new users. Yeah. Right?
Speaker 7:At least on the digital side
Speaker 1:Yeah.
Speaker 7:For games. And then we went into ecommerce as well, we made the model work there. People always want more customers Yep. And especially if they can buy them profitably. The question is how many more times over can you do
Speaker 1:that? Yeah.
Speaker 7:We've been able do it at a pretty big scale.
Speaker 1:Okay. So mobile games, super interesting economy, sneakily large again. I think the part of the reason why AppLovin is sometimes misunderstood is that people misunderstand how big the mobile games market is. They think like, oh, well, I'm familiar with, like, a blockbuster movie. Certainly, it's about the same.
Speaker 1:It's entertainment. No. It's way bigger. But walk me through, first, how big is the mobile game market? How international is it?
Speaker 1:Walk through the dynamics of, like, whales versus daily players versus free players. Like, what what's the shape of the market that you're describing to a potential new app loving customer?
Speaker 7:Yeah. Sure. So the mobile gamer is pretty much everyone. Think about it. You're on a first class flight.
Speaker 7:Right? You see somebody right next to you playing a word game or a solitaire game or you're on the bus or it's your wife at home. Yeah. So it's not just, you know, some kids sitting in their basement. Yeah.
Speaker 7:For us, we see over a billion people every single day. Wow. Primarily heads of households and female. Mhmm. So for us, like, we see it's a massive market.
Speaker 7:Yeah. And I think in the App Store, there's I think over a $120,000,000,000 of annual spend just in in app purchases. So that really speaks to the volume
Speaker 1:of it. Yeah. The dads are PC master race mouse and keyboard. Exactly. They have to call it dead on a mobile game.
Speaker 7:And I mean
Speaker 1:It's getting there. It's getting there. You you get the backbone. You click that into your phone. You can play COD mobile.
Speaker 1:There's there's little halo But with gaming streaming.
Speaker 7:The the business grew 70% last year, and it was primarily driven by the gaming side of the business. Yep. Ecommerce has been the really big massive thing for us.
Speaker 1:And
Speaker 7:listen, you say everyone's heard about us. Part of our TBPN app partnership, you know, helped
Speaker 6:with that.
Speaker 1:Yeah. Yeah. Totally.
Speaker 7:But no, it's it's been incredible. I mean, you know, kind of looking back, we're in '26. Yeah. In '25, we announced doing having a billion dollar run rate in the ecom business. Yeah.
Speaker 7:Was just a year of it being open. Yeah. Now, we're have our self serve referral only.
Speaker 8:Yeah.
Speaker 7:Thousands of accounts have onboarded
Speaker 2:Yeah.
Speaker 7:And hundreds and millions of dollars, hundreds and hundreds of millions of dollars of value has been generated for e commerce merchants.
Speaker 1:Yeah.
Speaker 7:And we're so small. I mean, like Mhmm. Just for the context of the market here. Right? So I think Facebook's got over 10,000,000 active advertisers.
Speaker 1:Mhmm.
Speaker 7:We only have a few thousand. Right? And so for us, this is like a holy crap once in an op opportunity, especially for advertisers that are looking for a new channel.
Speaker 1:That's amazing.
Speaker 7:For us, like, you know, we're at less than point 01% of the market share.
Speaker 2:Yeah.
Speaker 7:But we have north of $12,000,000,000 of ad spend compounding at 70%
Speaker 1:Yep.
Speaker 7:Year over year. Right? So we think this is gonna be a massive Yeah. Massive opportunity.
Speaker 1:So two questions on AI. Let's start with the the mobile game dynamic. We've seen those charts. The number of app store submissions is skyrocketing. And yet we all can't really point to, like, oh, there's that breakout game that was vibe coded by the, you know, the the the kid in the basement or something like that.
Speaker 1:And we could during the early app store boom. Remember was it Flappy Bird?
Speaker 7:Yeah. Isn't that created by
Speaker 1:a kid? Yeah. It really not it wasn't some Sand Hill Road $10,000,000
Speaker 2:NBA related game.
Speaker 1:Yeah.
Speaker 2:I didn't I didn't play it, but I had it at least a handful of people, but it was all web based.
Speaker 1:Few games that are happening. But what are you seeing in the data? Is anything starting to move where you're like, oh, like, that's AI or that's vibe coding? I can see something changing about the business. Or are we still sort of like pre showing up in your business?
Speaker 7:So what we see is really cool. I'd say on the advertiser and the developer side
Speaker 1:Yeah.
Speaker 7:More and more people are coming onto the platform. Okay. Right? And so on the developer side, what we see is that more developers are in need of distribution.
Speaker 1:Yep.
Speaker 7:It's now become a core part of the Makes
Speaker 1:so much sense. Yeah.
Speaker 7:In 2012, 2013, when we started the business, most advertisers would depend on just getting an app store feature.
Speaker 1:Sure.
Speaker 7:That is no longer the case.
Speaker 1:Yeah. Yeah.
Speaker 2:A buddy of mine
Speaker 1:Just be able to just climb
Speaker 2:the rankings. Go to an app. Yeah. I downloaded it. Yep.
Speaker 2:And then was later trying to leave a review because he's like, hey, this helps visibility. Yeah. Couldn't find the app in the App Store even if I searched the
Speaker 1:Exact name.
Speaker 2:Like the exact phrase.
Speaker 1:Yeah. There were so many little like
Speaker 2:find it through the link. So like Yeah. App Store discovery seemed like, you know
Speaker 1:There were so many little, like, I don't know, the, like, the web two point o playbook of, like, contact import, invite your friends, share social leaderboard, and people would be, oh, yeah. Game center integration is gonna be the thing that makes you pop out. And none of that was they were always sort of overpromising, but some of them did work. Like, some of them really did go viral and and had interesting distribution techniques, but a lot of those have been commoditized. So actually showing up and building your business on the back of Apple makes a lot of sense.
Speaker 1:What about AI internally? Eric Sufort at Mobile Dev Memo is writing a lot about GEM's model, the GEM model over at Facebook, that they're getting a lot of lift at Meta out of new, more advanced transformer based, you know, matching algorithms, advertising algorithms. It's sort of like the unsexy part of Meta's AI strategy. But have you started to see glimpses of just improvement in your system during the AI era?
Speaker 7:So, yeah. So, you know, on our side, our developers on a weekly basis are releasing improvements to our algorithm.
Speaker 1:Yeah.
Speaker 7:And a lot of those improvements are also on the backs of using the state of the art models in So we definitely get an advantage of it. Yeah. And outside of just like the ad algorithm itself, internally, our efficiency gains have been massive. Mhmm. Like I can speak for myself personally.
Speaker 2:Yeah.
Speaker 7:Our marketing team is eight other people. Yeah. Every single person on the marketing team
Speaker 1:Yeah.
Speaker 7:Is a vibe coder. Right? They're using cloud code. They're using codecs. Yeah.
Speaker 7:And they're building tools Yeah. To make them more efficient in their role.
Speaker 2:Yeah.
Speaker 7:You know, we before used to have to run everything through an engineer. Now everyone is their own engineer.
Speaker 1:Are you token maxing? Are you token minning or are you token min maxing? We're token maxing. Maxing.
Speaker 2:We're token maxing.
Speaker 1:Flashback to February. What's going on? Alright. Isn't this gonna be a problem? Aren't your shareholders gonna be upset?
Speaker 7:We've gotten some messages from IT. Flashback.
Speaker 2:Yeah. Coming in. Yeah.
Speaker 7:We've, you know, we've got some messages about costs getting a little bit out of hand. But, know, the the good thing is this.
Speaker 1:It's not showing up in the quarterly earnings yet.
Speaker 7:No. Not at all. I mean, the beauty is that when you've only got a few 100 employees and your gender haze, my revenue is not. So you're gonna have to be doing Hey.
Speaker 1:There was somebody who allegedly, might be a complete rumor, but $90,000 in a day. Wow. So I I think you might be changing your tune.
Speaker 7:No. We're we're nowhere near that.
Speaker 1:A light week. Half $1,000,000. Yeah. But, yeah, judicious use, token maxing, but not taken to the extreme. Yes.
Speaker 1:Yeah. Judicious usage. That makes sense.
Speaker 2:What what what does it take to all the digital marketers, growth people I know will happily test any new ad platform. What what has been the key to retaining customers. Right? Like, you know, a marketer, let's say they're managing a $20,000,000 budget. A lot of it's going to Meta, Google, handful you know, maybe some TV.
Speaker 2:You come to them and you say, like, give us a shot with, like, you know, a quarter mil or half a mil or something like that. Everyone will take the shot. Right? But you gotta if you wanna build a big business, you gotta retain that.
Speaker 7:Profitability at scale. Mhmm. So that scale is different for everyone. Some people are happy with you driving an extra 10% growth for their business. Some are saying, hey, you have to be the next, you know, Facebook or Google
Speaker 1:for us. Yeah.
Speaker 7:But I would say for us, like we see over half our clients actually retain. So we do a pretty good job. The algorithm works for a lot of people who come on. Now it's just getting the word out to the masses. Right?
Speaker 2:Yep. Awesome. That's next week?
Speaker 7:That is next week we open it. One other big thing is that we are going back to the App Lovin' name and this is a part of the
Speaker 1:love it. Amazing.
Speaker 2:That's what I want. I wanted the whole time.
Speaker 1:I wanted that the whole time. App Lovin' is amazing. It's it it transcends app. Like I think of it as its own entity, App Lovin. You know, it doesn't it doesn't matter
Speaker 2:And for for
Speaker 1:candoecom.
Speaker 2:For anyone that's confused Sorry. As to why Go is going back to the name App Lovin. Yeah. You guys were thinking about having the ad platform be named something
Speaker 1:else. Axon.
Speaker 7:Axon. Yeah. Yeah.
Speaker 2:So smart smart play. I always I always it's what I always wanted. I have no say in the matter, but I was always there.
Speaker 1:Yeah. Let's we're more marketing people. That's amazing. Talk about generative creative. Is is that in demand from your partners?
Speaker 1:Because I can imagine a marketer saying, you know, for this particular audience on this particular platform, yeah, I want you to just go to a frontier model and generate me a 100 different copy lines that all fit neatly in the box and generate some images and here are some screenshots to sort of work through. You could even have an AI agent actually use my game, take real screenshots, then you don't get the slop allegations. But in terms of layout, in terms of distribution, like, how much of that is brands coming to you saying, look, I'm already really comfortable with ChatGPT images or Nano Banana or Higgs Field, so I got it handled. I don't need your tool versus I would love for you to do this for me.
Speaker 7:Yeah. So taking a step back Yeah. The value of creative is that if you find the right creative that resonates with the right audience
Speaker 2:Mhmm.
Speaker 7:It can be one of the biggest growth levers for your business. Yeah.
Speaker 1:Sort of a power law.
Speaker 7:Exactly. Right? Yeah. It's, you know, let's say you spend an extra 5% on creative and you find a winner, it doesn't mean you're only going to spend another 5%. You could spend double.
Speaker 7:Right? Yeah. And so every advertiser wants more creative that's performing and high quality. Yep. And so amongst all advertisers we talk about, they all want the generative tools.
Speaker 7:Mhmm. What we have right now is generative interactives. So that has been very helpful for us. Yeah. Why is that?
Speaker 7:Why interactives? And we'll talk about video in a second. How our ad unit works is we show a video. Then there's interactive, and then there's a catalog. A lot of the clicks that happen on our ads are within the interactive.
Speaker 7:And so that has been massively adopted.
Speaker 1:And that's basically playing a demo of the game or a smaller version loaded probably in HTML or JavaScript, and then you get to demo it
Speaker 7:a little. You hit the nail on the head. Got it. That's exactly.
Speaker 1:And that's probably extremely cumbersome for a small small developer with a new game. They have to go create a new version of their game that loads quickly in the Applovin platform very seamlessly, and that's a perfect use case for
Speaker 7:and imagine you're not even a game studio. Right? You're an ecommerce store. You're selling wallets.
Speaker 1:And you wanna use the interactive.
Speaker 7:Right. Exactly. How interesting. Right? Well, the interactives are massive.
Speaker 7:Yeah. Right? And so it's where we get a majority of the engagement and you're showing an ad within a game. Right? Yeah.
Speaker 7:So how do you gamify that experience? Yeah. How do you allow it to look at more specifications of the product?
Speaker 1:Yeah. Yeah. Yeah.
Speaker 7:All I would say 80% of our top advertisers use interactives.
Speaker 1:Yeah.
Speaker 7:Yeah. And so it's such a massive unit.
Speaker 2:Yeah.
Speaker 7:Now, where is this going? So right now, we've got the interactives. Yeah. Now, video has been our main focus. Yeah.
Speaker 7:We have it in beta and it's been really good.
Speaker 2:Yeah.
Speaker 7:And so our goal is to get that out to everybody.
Speaker 2:Yeah.
Speaker 7:By the end of the year, how we envision onboarding on AppLovin is you go onto the site, you set up the pixel Yep. Then you create a campaign with one button. Mhmm. It automatically generates the creatives. It pulls the links.
Speaker 7:Yep. And then you're off onto the races. Right? You just have to tell it your goal as well. So that's where we expect where the market is going.
Speaker 7:And it's part of our goal, is making profitable advertising accessible to everybody.
Speaker 2:What's your advice for somebody that wants to be the first hire at a company that becomes worth 175,000,000,000 in the public markets?
Speaker 7:Work harder than everyone else around you and always be meeting people. I, you know, I got lucky to meet Adam. Yeah. Now, I
Speaker 2:don't think it was any luck. Like, just pure yourself. That's why I asked.
Speaker 7:But I know. I mean, like my background, funny enough is I am a high school dropout, right? What I tell everyone is that
Speaker 2:Do you get your GED or
Speaker 7:do No GED. If mom and dad are listening, sorry.
Speaker 1:Have actually gamed out? Can you get like an honorary PhD from some elite institution?
Speaker 7:I don't know. I haven't reached Because that's the max award.
Speaker 1:The advertising honors. Yeah. Wherever like your hometown has a university, you go give the commencement speech, you start donating and all of a sudden they're just like PhD. It's like probably cheaper. Like if you donate what the tuition would have been, you'd probably get the honorary degree.
Speaker 7:Well, Stanford and Harvard are listening, you know, my email box is open for you.
Speaker 1:I think they need you.
Speaker 7:But but my analogy I'd always tell everyone is that, you know, when you send the warriors out to go get food, the first question they ask back isn't who is the the the eldest tribes leader. It was who killed the animal and who brought us back the food. Oh. And so that was always my analogy of like, as long as I outworked everyone and delivered a ton of value
Speaker 2:Yeah.
Speaker 7:Yeah. Then I would be at the same conversation Yeah. Yeah. In the same table as everybody else.
Speaker 2:Yeah. Your advice. One word. Kill. Yeah.
Speaker 2:Exactly.
Speaker 1:Kill. I mean, yeah. You can kill at a lot of small companies. And if you provide value, if you provide ROI, you keep showing up. What about other platforms?
Speaker 1:I mean, were just talking earlier in the show about Fox acquiring Roku. They have Tubi. There's a lot of ad inventory there. Have you thought about getting into that space? Like, what does that look like?
Speaker 1:What what is the product line expansion beyond the phone look like in the future?
Speaker 7:You know, it's funny. Everyone talks about expanding. It's me. Yeah. We're thinking about consolidating more.
Speaker 7:Yeah. Focus. Exactly. Right? You know, you try to do everything.
Speaker 7:You can't go deep on many And things. So our what I would say is like our company has grown so much since we got rid a lot of the gaming studios. We stopped poking on that side of the business. For us, we feel like we have so much room to grow. I mean, remember, less than a tenth of a percent of advertisers in the world even use Apple.
Speaker 1:Sure. Sure. Sure.
Speaker 7:So let us get to millions of advertisers Yep. And then we can talk about the rest of the other platforms.
Speaker 1:That makes sense. And also, you're very fortunate, like, you're focused on a market that is growing, both like mobile gaming and advertising in mobile gaming and
Speaker 2:the And time commerce on phones.
Speaker 1:And time on like, you're I feel like 12 different tailwinds. Why go into a market that has headwinds?
Speaker 7:A 100%. I I don't think people are spending less
Speaker 8:time on
Speaker 7:their phone these days.
Speaker 1:Nope. Nope. Maybe in The UK if you're under 16 soon.
Speaker 2:John with your Apple Vision Pro. Yeah. You know, that's taking away some screen time. That's threat. That's a real threat to
Speaker 1:you guys. It's actually twice the screen time because
Speaker 2:it's both eyes, two screens.
Speaker 7:Nick's Nick's in one YouTube on the left.
Speaker 1:Yeah. Nobody's asking. Full brain rot.
Speaker 2:Awesome. Anyway, Excited for more people to to get access and great to meet you.
Speaker 7:Thank you so much. Thanks for having me on the show, guys.
Speaker 1:On the show.
Speaker 2:Not for a bit.
Speaker 1:We'll close out there. Leave us five stars on AppleFunCo. We got got suck. Okay. Do we got?
Speaker 2:One of the best ads I've ever seen.
Speaker 1:Okay. We're going from
Speaker 2:ad to In my life, this ad is is truly one of the best. Let's pull it
Speaker 1:up. Wait. What is this?
Speaker 2:This is just an ad from
Speaker 1:Chad. Cheaper usually. Cheaper usually. This is one of those Cheaper. Fake a this is one of those fake tech ads that the guy put up in the subway.
Speaker 1:That's what's going on.
Speaker 2:No? Cheaper. Usually. Yeah. I I started thinking, well, in what settings is it not cheaper?
Speaker 2:It's really tough if you're trying to get people to to switch.
Speaker 1:It's certainly not cheaper if you're trying to go like one block. Like a car is always gonna be is always gonna be more expensive. But this also feels like it's like we're trying to be cheaper. It feels like price war with Uber still. But it's like we're sort of doing a price war but not all the time.
Speaker 1:So you don't know. It's not really a guarantee a sort of like feel like most marketing campaigns need to guarantee something. Even if it's a moderate guarantee, it's like 5% cheaper every time.
Speaker 2:Yeah. But because if it's cheaper usually, could they not just say cheaper? Even Drop the usually.
Speaker 1:The usually is hilarious. Like, I'm thinking about different campaigns
Speaker 2:like If you take if you take a bunch of Lyft rides
Speaker 1:Yeah.
Speaker 2:At the same route Yeah. Every single day and you take a bunch of like Uber rides
Speaker 1:Yeah.
Speaker 2:Yeah. You could probably just make the argument that it's cheaper.
Speaker 1:Yeah. Well, what's the what what's that airline that has the tagline bags fly free?
Speaker 2:Tough to put cheaper and then your logo.
Speaker 1:Yeah. Because That's not good either. I think it's Southwest that has bags fly free. Like, can you imagine how bad that campaign would be if it was bags fly free usually? Usually.
Speaker 1:Like, built Ford tough. Usually. It's usually built Ford tough. Not always, but usually. What are some other big just do it.
Speaker 1:Usually. Usually
Speaker 2:the most expensive option.
Speaker 1:Most I most
Speaker 2:That's even that's even that's even worse because then they're thinking, okay, sometimes it's the most expensive. Anyways, folks, I'm rooting for Lyft.
Speaker 1:There's some other billboards.
Speaker 2:Let's check-in.
Speaker 1:The the new Chad GPT billboards are are really good.
Speaker 2:Lyft is up 10% in the last month.
Speaker 1:The Chad GPT The image is working. It's really cool. I like it because it has the same like it it is aesthetically pretty but it's also functional. It like actually
Speaker 2:fly free anymore apparently.
Speaker 1:Oh, yeah. They don't. But there was one airline. Think different usually. I'm loving it usually.
Speaker 1:McDonald's. A diamond is forever, usually. De Beers. What's the other one? Finger licking good, usually.
Speaker 1:KFC. It's very ominous.
Speaker 2:The best a man can get, usually. Gillette, usually. Breakfast of champions, usually.
Speaker 1:Have it your way, usually.
Speaker 2:I'm loving, usually. Like a good neighbor, like a good neighbor, State Farm is there, usually.
Speaker 1:The few, the proud, the marines, usually.
Speaker 2:Taste the rainbow, usually. Red Bull gives you wings, usually.
Speaker 1:That's actually probably accurate. Anyway, these
Speaker 2:are Why the friendly skies, usually.
Speaker 1:Wait. I gotta tell you about Shopify. Shopify is the commerce platform that grows with your business and lets you sell in seconds online, in store, on mobile, on social, on marketplaces, and now with AI agents always. Shopify always lets you do this. They never it's not a usual thing.
Speaker 1:Verizon's Let me also tell you about Codex. Codex always is a powerful workspace for always getting worked on with AI agents. Whether you're writing code, analyzing data, creating content, or automating business workflows, Codex always helps you move projects forward from start to finish. Always.
Speaker 2:Visa. Everywhere you want to be, usually.
Speaker 1:Also, we told you about public earlier, but it's investing for those who take it seriously.
Speaker 2:BMW, the ultimate driving machine.
Speaker 1:Yeah. We all oh, we also got to talk about fin dot a I sale to Salesforce. Fantastic outcome. True testament to founder mode. Give it up for Owen McCabe, friend of the show.
Speaker 1:Mark Benioff, friend of the show. Teaming up. Absolutely amazing outcome. Such a wild ride to build intercom, wind up raising a ton of money, build a great business but not, you know, have this like, you know, founder energy. We talked to talked to Eoin about this where it was like, the business is working.
Speaker 1:Things are growing. It's not crisis mode. It's not wartime anymore. And he sort of got forced into peacetime and then AI shows up and he gets to go back into wartime. And he delivered fantastic growth, fantastic new product, a fantastic outcome Met the for moment.
Speaker 1:Everyone, met the moment and is now on, you know, the the the Salesforce team and gonna be absolutely
Speaker 2:Great.
Speaker 1:Knocking heads
Speaker 2:Great outcome for Intercom and Finn. Massive pickup for Salesforce.
Speaker 1:Yeah. I mean, the rebrand, crazy move. Like, I think a lot of people were like, wait, Intercom's like this known thing. Why are you launching a new product and rebranding the whole company? But that's the type of thing that you get when a company switches into wartime mode, switches into founder mode.
Speaker 1:And so you get these like high risk, high reward things. And I don't know if the rebrand or the rename was, you know, that critical to the outcome. There was a lot of other stuff, mainly the growth, the product. Right? But it just shows you that OWN came in and said, I'm willing to change literally everything including the name of the company that I've been running for a decade.
Speaker 1:So fantastic news. The transaction is expected to close in the fourth quarter of fiscal year twenty twenty seven. That's a long time to integrate, but good luck to them to get through that. It's been fifteen years in the making, so what's six quarters to wait around for them to Super close happy to the team. Outcome in the seat for twenty seven years.
Speaker 1:Benioff's been at it. So fantastic crew. Congratulations to all in all.
Speaker 8:Clearing order in
Speaker 1:Leave us five stars on Apple Podcasts and Spotify. Sign up for a newsletter at tbpn.com, and we will see you tomorrow at 11AM Pacific. Goodbye.
Speaker 2:Technology's Daily Show. Technology in Motion. According to Trane in the chat. We love you. Goodbye.
Speaker 2:Goodbye.