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Technology's daily show (formerly the Technology Brothers Podcast). Streaming live on X and YouTube from 11 - 2 PM PST Monday - Friday. Available on X, Apple, Spotify, and YouTube.
You're watching TVPN. We are in an undisclosed location, so we will be a little bit quieter with the intro. But it is Friday.
Speaker 2:It hurts for Not to yell.
Speaker 1:Yes. It hurts. We will be back in the ultra dome soon. Don't worry. But today, we are still emotionally in the Temple Of Technology, the Fortress Of Finance, the capital capital.
Speaker 1:And we need to kick it off with the level 100 performative tech bro final boss, Peter Diamandis. Are you familiar with Diamandis?
Speaker 2:An absolute legend in the game.
Speaker 1:Yeah. What is it? Singularity? Yeah. Yeah.
Speaker 1:I mean, he has a podcast. He's he's done a number of businesses. XPRIZE, I believe, Moonshot stuff. But, man, was he early to the Singularity game? Yeah.
Speaker 1:Like, it's he was talking about that with the the Kurzweil era. Yeah. And, but the whole reason he's getting called a performative tech bro final boss is because, of course, he is vibe coding on rep lit over Starlink
Speaker 2:flying himself up to the Bay Area. The only thing he missed was sleeping on an an Eight Sleep.
Speaker 1:Sleeping on an Eight Sleep. He should have had the Eight Sleep in there. Yeah. And then he should have had Infinite Jest printed out sort of had Pathfinder. Some
Speaker 2:type of homegrown Yeah. Like autonomous flying setup, actually flying the plane.
Speaker 1:He should have had a ramp card in display.
Speaker 2:That's right.
Speaker 1:Time is money. Save both. Easy use corporate cards, bill payments, counting a whole lot more, all in one place. Go to ramp.com. Lot more.
Speaker 1:We are, of course, on the road. We've been on the road a lot this week.
Speaker 2:We hate being on the road.
Speaker 1:It's not our favorite thing. It's very, very rough. We know it changed the show. Hopefully, we will, get back in the swing of things and kinda bring you the show that you know and love. But But
Speaker 2:we're doing our best
Speaker 1:doing our best. Of course, this part this stream's made possible. Right? Restream one livestream 30 plus destinations, multistream, and reach your audience wherever they are. And for our gracious hosts, we're able to loan us a, a whiteboard where we were to piece together exactly what's going on in tech.
Speaker 1:We're gonna take you through the stories today. OpenAI.
Speaker 2:Was just, like, calling this out. This is exactly gonna spend the next
Speaker 1:Trying to decipher. Decipher. Yeah. Three hours trying to decipher. Together.
Speaker 1:And they will understand the real nature of tech, how it all connected.
Speaker 2:This is the current state of tech.
Speaker 1:Yeah. Right? I like it because there are some connections there, like Amazon Anthropic. That red line is real.
Speaker 2:Real. The Hamptons and Pawtuck.
Speaker 1:Also Also, there's the connection there. Menidas, we'll leave it up to the viewer. That's an exercise for the viewer to see how he's involved. We didn't get Figma on there. We should have we should have been doing all this on a FigJam.
Speaker 1:You should go to figma.com. Think bigger, build faster. Figma helps design and development teams build great products together. You get started for free. So the actual big story is that OpenAI, the nonprofit, is gonna control its for profit arm and own equity valued at $100,000,000,000.
Speaker 1:I believe this will make it the most highly valued nonprofit or, like, the most profitable nonprofit in world history, the best funded nonprofit. Right? And it is remarkable to think about what that will be like. People have kind of written off the nonprofit as, like, it was going away. Like, it is not going away.
Speaker 1:Like, it will continue to be big back. It's it's it's incredibly back, funded forever, essentially, to do a ton of interesting things. I think we're gonna see interesting things about, come out of that organization. But, anyway, the news, this is from the journal, and we'll and we'll break this down. But Nick has it summarized here.
Speaker 1:OpenAI LLC will be converted into a Delaware public benefit corporation. OpenAI nonprofit retains control of the new public benefit corporation. The nonprofit will hold a $100,000,000,000 plus of equity in the public benefit corporation. The PBC structure enables raising large amounts of capital for the mission, which obviously they're already doing. They're still aligned with ensuring AGI benefits all of humanity.
Speaker 1:I think that's good. Got also. It's aligned with, like, your shareholders. Like, if you're just a normal c corp I know they're a public benefit corporation, but if you're just normal c corp, like, shareholders are humans. Let's make sure it benefits the shareholders.
Speaker 1:That will, by definition, benefit humanity. But, specifically, they're saying all of humanity. Even if you're not a shareholder, AGI should still benefit you, which is a noble cause. OpenAI and Microsoft signed a nonbinding MOU, for the next phase of the partnership. A definitive agreement is still being negotiated.
Speaker 1:OpenAI says it's engaging in California and Delaware.
Speaker 2:As it stands, Microsoft gets 20% of OpenAI's revenue. And for
Speaker 1:the big man. Something like that.
Speaker 2:Man, Satya. Something like that, which I it it felt like a stretch to me that that that would be sustainable given the looming costs that, OpenAI needs to incur? Obviously, they're ramping revenue really quickly. Yeah. But you have Broadcom to pay.
Speaker 2:You have Oracle to pay. You have all these
Speaker 1:But it is by the revenue. You know? It's not the same as being like, we're on the whole crazy fixed. Yeah. Yeah.
Speaker 1:It's enough fixed. Exactly. But yeah.
Speaker 2:But still it's a lot of, you know, the the there's these companies are under margin pressure already.
Speaker 1:And and and wasn't the original deal that it would it would be 20% up until they paid a $100,000,000,000 or something like that? There was something where, like, it eventually ran its course. I believe it had an ending, and I think that's what's justifying a lot of the underwriting. Because the lesson from Google, the lesson from Facebook, the lesson from, you know, Microsoft and the rest of the hyperscalers was that you needed your DCF models to be twenty or thirty years into the future. Right?
Speaker 1:Yeah. And so if you just if you if you didn't take into account the third decade of growth, you were undervaluing It
Speaker 2:was originally reported twenty percent through 2030
Speaker 1:Okay.
Speaker 2:Which still is
Speaker 1:I don't think a lot of investors are scared by thinking about value in 2035. I think they're fine with that now. I think they're saying, like, yeah. I have a ten year fund, and realistically, the best venture investments, SpaceX still hanging out in the portfolio twenty years later. They got continuation funds.
Speaker 1:I think that a lot of investors are actually fine to say, yeah. This company is gonna be, like, you know, maybe a financial mess for ten years. But if I'm super confident it's going to be a money printing machine in twenty, I'll do the deal all day. Yep. I think that's a wraparound.
Speaker 2:It's still insane to think that the deal ever got done in the first place.
Speaker 1:Because The Microsoft deal?
Speaker 2:Yeah. If you were if if if you talk to a founder and they were like, yeah. I was running a fundraise and, like, you know, ended up taking this deal. I got the valuation I wanted, but, ultimately, it gave up 20% of revenue
Speaker 1:Perfect action.
Speaker 2:Off the top too. So not 20% of, like, profits, but, like, a 20% tax on gross revenue
Speaker 1:Yeah.
Speaker 2:Just for the just till 2030.
Speaker 1:Yeah. That would be
Speaker 2:And then and the founder's like, well, it doesn't matter that much because I'm in this for, like, twenty years.
Speaker 1:You're Yeah. Yeah. You most most people do not get the pass on that.
Speaker 2:Yeah. Very few businesses very few businesses in the world, especially, like, highly competitive, you know, categories, can sustain a 20% tax off the top Yep. And still really produce any profits or or be
Speaker 1:I mean functioning at all. But, obviously I'll push you off. What if your what if your business is mobile games in the App Store? You've effectively been paying Apple at 20%, 30% tax off the top
Speaker 2:for There's a bunch of examples. Like, Nvidia could do this too. Right?
Speaker 1:Yeah. Yeah.
Speaker 2:Yeah. And they sort of are through
Speaker 1:Yeah. Yeah. So kind of deal. I I don't know. I I I mean, I agree with you.
Speaker 1:Like, it is it is a crazy crazy deal, unprecedented in a million ways, but everything about the entire OpenAI story is unprecedented. Yeah. Unprecedented to start as a nonprofit. Unprecedented to have who are the cofounders? Elon Musk, Peter Thiel.
Speaker 1:Like, you have, like, seven different cofounders who have, bunch of cofounders who have gone off and start direct competitors. That doesn't happen very often. Usually, people are like, I got bags in the category. I'm gonna go work on something else. Yeah.
Speaker 1:There's a bunch of weird stuff. Anyway, speaking of the the nature of the of the industry and all the competitors, Sergei, has a bit bit of a joke post here saying, Dario, Claude will take your job, but it will feel ashamed. Elon, look at this anime girl. She says the n word and is almost naked. Zuck, super intelligence will help people watch more Instagram reels.
Speaker 1:Demis, Gemini recently calculated more precisely the motion of the heavens. Sam, excited to open to announce that OpenAI Inc. Has entered into a definitive agreement with OpenAI LP and OAI Corporation and has signed MOUs with OpenAI OpCo LLC and OpenAI Global LLC. It really sums up, it really sums up. And Sergei
Speaker 2:They're all cooking.
Speaker 1:Yeah. They are all cooking, and they're all telling, like, slightly different stories. Sergei, these are all real corporate entities, by the way. But
Speaker 2:And it's yeah. It's worth noting. I it feels like Satya has definitely slow played the renegotiation of this deal. Like, this has been they've been trying to make this happen for a long time. It was reported a while back that Satya wasn't wasn't budging.
Speaker 2:Yep. But it's good to see that the company is able to
Speaker 1:So here's a moving forward. Rohan Paul on what's actually happening with this OpenAI and Microsoft, deal. Microsoft and OpenAI struck a truce to extend their partnership, clearing a major obstacle to OpenAI's shift into a for profit structure. The new agreement is nonbinding right now, but it sets the final stage for final terms to be hammered out soon. In the proposed setup, Microsoft and the OpenAI nonprofit would each start with about 30% of the new company with the rest going to employees and investors.
Speaker 1:The new company is the for profit entity OpenAI is trying to create as part of its restructuring. OpenAI plans to keep nonprofit control and give that nonprofit an endowment stake valued at a $100,000,000,000. Wow. Which would be huge on paper, but the timeline to turn it into usable grants is unclear. Although with the secondary markets, you imagine that that has to be, like they're gonna make payroll next quarter.
Speaker 1:Like, they'd be able to sell some, a $100,000,000,000 and and do a whole bunch of grants. California and Delaware attorneys are generally reviewing the plan, and OpenAI has told its investors it aims to finish the restructure by the end of the year or risk losing its 19,000,000,000 in funding. It's very funny that, like, for all this drama, all the books that we've written, the movies, like, end result's like, okay. There's, like, three parties around the table. How about we go equal?
Speaker 1:Like, Microsoft gets a third. Nonprofit gets a third. Employees, investors get the third. Like, there's really, like, three key counterparties in the deal, and they're it seems like if this is what happens, they kind of just all walked away being like Yeah. Three equally.
Speaker 2:Three key part parties on the on the effectively on the cap table, but then you also have the California being like, hey. Don't mess this conversion up. You know, you're you're a nonprofit. Yeah. California and Delaware attorneys general are reviewing the plan, and OpenAI has told its investors it aims
Speaker 1:to I'm talking about, like, the the the end result of, like, who gets what in the like, there's a bunch of poker chips on the table right now, and there's a bunch of bunch of there's parties around there that all need to agree before anything moves forward. Right?
Speaker 2:Yeah.
Speaker 1:And it's just interesting that, like, what they wound up with was, like, let's go equal. Like, let's split it equally.
Speaker 2:Yeah. If if you play this out, what what happens what is the what what do you think the nonprofit looks like ten years from now? OpenAI continues to execute very well, becomes a multitrillion dollar, you know, tech giant
Speaker 1:Yep.
Speaker 2:And you have a third of the company owned by this nonprofit. What do you think how how happen, buddy. How would you how would you allocate?
Speaker 1:What what happens when you get a ton of missionary AI genius scientists who don't wanna optimize for profits? They're just experimenting, working on whatever ideas they want. There's no pressure because they don't have a user base. They don't have an App Store. They're not competing with anyone.
Speaker 1:They just get to go do pure research. What do you think will happen?
Speaker 2:So they're gonna create the
Speaker 1:Banger consumer app will happen for sure.
Speaker 2:Oh, another
Speaker 1:way. Nonprofit is gonna launch another company, and it's gonna convert to for profit again.
Speaker 2:Well That's my I don't know. I mean, you could you could you could Last time. The question is, like, okay. What is the real relationship between the nonprofit and and OpenAI, like, the the private, you know, for profit
Speaker 1:Yeah. Yeah.
Speaker 2:Arm. Yeah. There's a world where they're just like, okay. We're just gonna keep a lot of research and r and happening at the nonprofit layer. Yeah.
Speaker 2:And then, like, try to just be the ones that Commercialize commercialize every time? Time. Even though you would have to argue if it's like this.
Speaker 1:I don't know.
Speaker 2:Yeah. If it
Speaker 1:I think I think over time, like, the two entities will actually separate and drift apart. We Hard
Speaker 2:to drift apart when we're you know, they're sitting on on a
Speaker 1:30% of the cap table?
Speaker 2:Yeah.
Speaker 1:I don't know. That's not that crazy. Like, there are VC funds that own 30% of the company when it goes public. And
Speaker 2:Well, yeah, they'll drift
Speaker 1:Like, the the VC fund is, like, off doing some other stuff. Right? Investing in competitors sometimes. Like, just kind of looking for the next thing, getting out of the position slowly. Right?
Speaker 1:It's selling into the public markets. So I don't know. Of course, I'm kinda joking, and it's, like, a little bit of a hot take to think that, like, there will be something. But, truly, like like, if you if you want the the okay. Another interesting twist is, like, right now, there is a there is a war for talent in AI, and there's a war for for specifically for missionary talent.
Speaker 1:Right? The true believers, the folks who are just gonna go grind and and explore and not be not be beholden to, you know, optimizing the like, next quarter's MAUs. Right? So if you're OpenAI and you don't want your direct competitors telling that story, hey. We're the missionary AI lab, creating a talent vacuum for that type of that type of that archetype of researcher with the nonprofit.
Speaker 1:Saying, oh oh, yeah. Well, like, we're a nonprofit. Like, you can do whatever you want. You can just do research, and we'll match the salary that Anthropics paying you. Or or is oh oh, Zach made an offer?
Speaker 1:Yeah. We'll match it just for you to come and hang out Yeah.
Speaker 2:Can they give those researchers exposure to the private company shares here?
Speaker 1:Oh, is
Speaker 2:that Just being like, yeah, all of our directors at the nonprofit, like, they get paid out a bonus based on you know, there's there's plenty of histories of nonprofits being abused. Right? Yeah. Like, nonprofit
Speaker 1:people get paid, like, high salaries.
Speaker 2:You Well well,
Speaker 1:stock yeah. In a different company.
Speaker 2:Well, yeah. But it it could just be, like, you know, every year, the stock appreciates
Speaker 1:Yeah.
Speaker 2:Some amount and they sell off a position to be able to pay.
Speaker 1:You would assume that they that they're selling down the position and paying cash.
Speaker 2:That's such such a strange position.
Speaker 1:It's extreme.
Speaker 2:It's extremely strange. And this is why when I talk to founders that are, like I think more and more people have kind of, like, standardized around just, like, start your company on Stripe Atlas.
Speaker 1:Yep.
Speaker 2:Don't try to re Delaware c corp. Yeah. Delaware c corp on Stripe Atlas.
Speaker 1:Post Elon, like Make sure you have that thing. Team. Like, that has not made its way down to startups. Yep. Most startups are just
Speaker 2:Dan. Bills for c corp. Every I mean, I have I have a a friend of mine that I grew up with that that had a breakout consumer product.
Speaker 3:Mhmm.
Speaker 2:He botched the cap table, didn't set up vesting, and it ended up costing him, like, millions of dollars. He would effectively be retired in his thirties if he had not if he'd done this correctly. And that's why it's, like, it's so key to get the foundation, the legal structure of a company set up properly. And so the fact that you had Peter Thiel, Elon Musk, Sam Altman, they all set up this this entity. And and in the fullness of time, it's like they botched it.
Speaker 2:Right? Like, it it was it was a maybe a good idea at the time to try to create a nonprofit for AI research, but just got kind of messier and messier and messier and messier and messier. And every single, you know, person involved is probably thinking, wish we just set it up as a
Speaker 1:Yeah.
Speaker 2:As a c corp from the beginning.
Speaker 1:Yeah. Completely agree. Good take. The yeah. This idea of, like, you know, you like, the folks who are on the founding team are not dumb.
Speaker 1:They're, the smartest people in Silicon Valley, basically. So maybe they were, like, overthinking it or, like, too smart and being, like, let's create an even more complex structure. The other the flip side of, like, the steel man on, like, what happened is if you play it back and you go back to, like, 2015, you say, like, okay.
Speaker 2:Yeah. They they raised they raised a lot of money. And at the time, AI was maybe too like, there there wasn't an immediate commercial opportunity. And so it's very possible they wouldn't have been able to raise, like, the the Even if they raised that they got.
Speaker 1:I think they might have been able to raise the money. But then my question is, like, what happens in, like, 2017 when your share price is kind of stagnating, you still haven't made revenue, and every and the and the meme in Silicon Valley is like, oh, yeah. Like, Sam raised a mega round, a preproduct market fit. Like, that company is not really doing anything. When are they gonna ship?
Speaker 1:Right? Instead, it was just like, oh, yeah. Like, they have a research organization. They're, like, continuing to do cool, like, little projects here and there. And, like, oh, they got the they got a they got a robotic arm to solve a Rubik's cube.
Speaker 1:We're like, oh, they wanted chess or Dota or, like, whatever they did. And so I bet I bet the vibes were better throughout that. Really hard with a c corp to to keep because everyone's looking for a
Speaker 2:Yeah.
Speaker 1:When you're flat. Then it's like, yeah. Yeah. I mean, we've seen this with so many other companies that have raised hundreds of millions of dollars pre product launch, and it's really hard to get out finally. So I don't know.
Speaker 1:The counterfactual is fascinating. I wonder if it would've how how it would've played out. It's tricky.
Speaker 2:Yep. Anyway. Yeah. It's just interesting that almost every person around the table probably feels like they would have benefited from a more simple traditional structure.
Speaker 1:I think you're right. Yeah. And I think Sam's even said that. But like, yeah, we kind of overthought this one. And like Yeah.
Speaker 1:Would have been better just to come in clean. But, you know, it worked out anyway, more or less. And, like, they they we we we got the product.
Speaker 2:Honestly, OpenAI is the best example of, like, if you have true product market fit, you can botch so many things True. And still be wildly successful.
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Speaker 1:So I think we covered most of this. We can go through a little bit of The Wall Street Journal's coverage. The the Primeagean, I hope I'm pronouncing that correctly, is is putting, Dario from Anthropix, claims about AI progress in the truth zone. Said these we are twenty eight months into six months from AI taking your jobs, four months into twenty four months until cursor is obsolete, and six months into six months until AI writes 90% of your code, part two, the codening. So exactly six months ago, this is the report from Futurism.
Speaker 1:The CEO of Anthropic said that in six months, AI would be writing 90% of code. And there and so I think people when he when Dario said this, people interpret it as, okay. Well, 90% of the software engineering jobs are going away, and that certainly hasn't happened. I mean, we're not seeing, like, fantastic job numbers broadly in the economy. There are, like, rumblings about software engineers not getting hired as fast as they should.
Speaker 2:New grads struggling.
Speaker 1:New grads struggling. But, I mean, we're talking about, like like, what, a few percentage points, if anything. That's certainly not 90% of software engineers are out of a job. Yeah. But simultaneously, we're seeing folks like Brian Armstrong at Coinbase highlight that what is it?
Speaker 1:40 of their code is written by AI now. There's a lot more code being written There
Speaker 2:that count are great companies
Speaker 1:Yeah.
Speaker 2:That are internally not focused on hiring new people. Yes. And that they're still ramping revenue. Right? We talked about talked about this.
Speaker 1:Code.
Speaker 2:Headcount.
Speaker 1:Yep.
Speaker 2:At with Palantir, head count is, like, relatively flat. Yep. Revenue's way up. Couple thousand people. Klarna.
Speaker 2:Right? Yep. Headcount is way down. Yep. Revenue's way up.
Speaker 1:Couple thousand people.
Speaker 2:And so you have these companies that are doing well, growing really fast, and then not at needing to add a lot of people. You know, you could just make an argument that that's like willpower. Right? Or the Yeah. The other side of it is like, you know, they're getting new efficiency.
Speaker 2:And, yeah, there there's it's an interesting it's hard to tell what what's driven by increased efficiency due to AI versus just CEOs deciding, like, we're all gonna do more.
Speaker 1:Yeah.
Speaker 2:And you don't I'm not giving you Yeah. We're not giving you budget to, like for this new product you wanna launch, have two people launch it. Yeah. We're not gonna give you, you know, 20 people and and, you know, some massive Yeah.
Speaker 1:It is it is like, if you had told me, like, artificial AGI is real. We'll pass the Turing test. AI will be able to write code at the level of a mid tier software engineer, maybe not total top tier software engineer, but, like You're gonna one shot a calendar app. Billions yeah. You're one shot of a calendar app, and billions of dollars will be spent on this, like, every month.
Speaker 1:I would have said, like, okay. Well, like, I would expect that, like, my my the app from United Airlines is less buggy. And, like, I haven't experienced that. I haven't I haven't been, like, walking around the Internet using different websites and tooling and being like, oh, wow. They did a complete rewrite on this.
Speaker 1:It's so much faster. Or like, oh, wow. There's no bugs in this thing or that thing. It's like it's still very incremental. Like, we really do have a lot more software to write.
Speaker 1:Because I do believe that the code's being written and, like, the product like, internally, every company is writing more code and doing more things, but the amount of
Speaker 2:Yeah. I mean, to do
Speaker 1:actually improve your experience is crazy.
Speaker 2:There's a lot of CEOs and CTOs and engineers that have come out and said 90% of my code is written by AI, but they're they're still like, it's not like they suddenly only need to work for an hour a day. Yeah. It's not like they it's just like The whole Okay.
Speaker 1:We just need to do hard, if not more.
Speaker 2:Yeah. We just need to do more.
Speaker 1:Yep. Totally. Totally. Well, if you're writing a lot of code with AI, you need code review for the age of AI. That's graphite dot dev.
Speaker 1:Graphite helps teams on GitHub ship higher quality software faster.
Speaker 2:Teams like Ramp, Figma, Asana, Cursor, Shopify. Big deal. You know, like, and more.
Speaker 1:We have a post from Ara Karazian, came on the show earlier this week. He has the data on GPT five. He says GPT five was good actually. After a launch that led that led Sam Altman to apologize, the latest ramp data shows OpenAI is growing business adoption faster than any other model company tracked by Ramp AI Index. It's also not just text tech manufacturing is adopting AI faster than any other sector, and it's why the consensus figures on AI adoption are probably wrong or the census figures, which we talked about with Ara.
Speaker 1:And he says read read his full analysis on Substack. You can go to econlab.substack.com to subscribe to our Karazian, and you should, of course, go to tbpn.substack.com and subscribe to our newsletter. So, the Ramp AI Index, the model adoption rate, the share of US businesses with paid subscriptions to AI models jumped significantly in what is it? This is probably March was OpenAI's really crazy fast takeoff. And then in July, the data's up again.
Speaker 1:It it this doesn't read purely as, this this reads more as, like, people understanding o three and reasoning models, and starting to pay. Also, just more monetization tiers, probably, more ways to pay maybe. But, 44% of US businesses, now have paid subscriptions to AI models, platforms, or tools across OpenAI, Anthropic, and XAI, Google, and DeepSeek. And the the Google number seems low since I would imagine that some of those Gemini subscriptions maybe get rolled into Google Apps, like, because Gemini just shows up in the Google Apps billing already. We'd have to talk to our end and dig in more.
Speaker 1:But, I mean, it sure like, clearest piece of the data is that OpenAI is on an absolute tear here in the b to b context, which is interesting. Yeah. And and it's not like we're we're not seeing, like, oh, GPT five sucks, so it's falling off a cliff. It's like, no. Like, the the models are getting better.
Speaker 1:It's just like we talked about this with the iPhone. Like, if it was if it was worse, they probably wouldn't release it. They just stick with the best. But Yeah.
Speaker 2:Anyway This is crazy.
Speaker 1:This other yeah. This is another pro ChatGPT's impact and OpenAI's, like, the I guess, like, I could put this loosely in the bull case,
Speaker 2:but Yeah. So Isaac says, I met someone this morning whose number one source of traffic is ChatGPT's supplement brand and has figured out how to get ChatGPT to recommend the brand whenever someone asks about a specific problem. Crazy. That is crazy. I feel like I'm surprised we haven't seen more of this, but it's just taken a while for It took a while.
Speaker 2:Not only tragedy to get adopted to the point where it's statistically significant, but then also people to figure out how to make it happen.
Speaker 1:I mean, you did the podcast boom firsthand. And how long was it like, podcasts had existed for years before we saw, like, a g one become, like, the podcast supplement brand. Right? Yeah. And and there were a few other brands where it was like this their whole growth strategy was unique to the water.
Speaker 2:Do you remember them?
Speaker 1:Four Sigmatic for sure. That's a great example.
Speaker 2:I yeah. My friends my friends had a podcast, and I was in college at the time. They're they were quite a bit older. Mhmm. And when I met them, they had one sponsor, which was like some random coffee company that just like happened that the founder happened to be in the audience.
Speaker 2:He just reached out. Yeah. And was like, hey, let me like Hey. So so they they didn't they started the podcast without any real plans to monetize or anything like that.
Speaker 1:Yeah.
Speaker 2:And I I at the time, it still felt like I was late to podcasting because there was a bunch of podcasts that that
Speaker 1:I mean, you could say the same thing about direct to consumer advertising on on on, like, meta Platforms. Yeah. Like, the the the Four Sigmatic, I heard do do we hear the numbers together? Someone was talking and saying that so Four Sigmatic era was
Speaker 2:so crazy because it was, like Yeah. Every you know, a few a number of brands realized like, hey, you can buy like really cheap, really effective advertising
Speaker 1:On Instagram. On Instagram and meta meta And platforms then And that allows you to scale number of brands. Too quickly.
Speaker 2:Yeah. With literally like, if you had a decent product and you had funding, you could like per you know, scale overnight. And so many people realized that yeah. So many people realized the opportunity and just flooded it and just peed it away. Auction.
Speaker 2:So Yes. So supply grew, but the demand, you know, for the ad inventory.
Speaker 1:Yeah. I think in the mushroom coffee category, there are three or four different brands doing a $100,000,000 plus in sales. Maybe, like, $300,000,000 plus in sales. Like, there are some really, really
Speaker 2:big Yeah. There's Mudwater.
Speaker 1:Mudwater, or Sigmatic. There's a two there's two others that I haven't heard of. And and and you just every time you hear I
Speaker 2:heard it crazy.
Speaker 1:Yeah. They went from they went from 0 to $200,000,000 in five years.
Speaker 2:I I heard a crazy story about a somebody interning at one of the mushroom coffee companies. Mhmm. Leaving Leaving. Started they wanted getting an an out and generate this company was already a 9 figure revenue mark. Intern left and started another one and then outgrew the original.
Speaker 1:That's insane.
Speaker 2:Yeah. Yeah. A lot of Wiggly mom.
Speaker 1:Financial. I I I I do wonder what those companies look like in five, ten years. I mean, we've seen, when we talk to the Ridge guys, like, like, top line growth is not the end all be all of d to c success. Like, you have to generate Cash flow matters. Cash flow matters, and this takes time.
Speaker 1:And so, when you hear one of those, like, crazy revenue ramps, especially in d to c, you should always ask this even in AI. But in d to c, you really need to understand, okay. Is there is this just the founder's good at fundraising, and they're losing money on every transaction, and they're just gonna keep this flywheel grow going because they've figured out how to make their revenue steeper than everyone else, and so they keep getting funded? Or is there something really special about the I
Speaker 2:always used to
Speaker 1:I always
Speaker 2:used to laugh. Something about unprofitable SaaS. Mhmm. I mean, it's it's like, how are you gonna sell software and lose money? It's funny, but, like, selling physical goods, it's like, wait.
Speaker 2:You sold this mattress? It cost you money to sell this mat to make it sell this mattress?
Speaker 3:Yeah.
Speaker 2:Yeah. And, obviously, there's plenty of cases of of great companies that that were deeply, you know, unprofitable for for a long time. But something about D2C companies, you know, running running in the red, massively. Yeah. It's like, come on.
Speaker 2:You should at, you know, at least
Speaker 1:I mean, it's like lemonade stand stuff. It's like, as a kid, you learn, like, buy the lemons, buy the sugar, get the pitcher, and then add it all up, multiply it by two. That's how much you're charging. It's like cost based pricing is, like, you know, the most instinctual economic force in the world that, like, a child can understand. And yet we justify all these different things, and sometimes it makes sense.
Speaker 1:Sometimes it does make sense to lose money on SaaS for a little bit if you're building a, you know, some sort of network, some sort of locked in thing, some sort of high margin opportunity down
Speaker 3:the road.
Speaker 1:Anyway, if you're growing your business, you need to analyze some data, get on Julius. What analysis do you wanna run, chat with your data, and get expert level insights in seconds that are loved by 2,000,000 users and trusted individuals at Princeton, BCG, and Zapier.
Speaker 2:Equally important, we need to talk about ProFound in the context of ChatGPT traffic.
Speaker 1:Yeah. I was I
Speaker 2:would not be surprised if the company that Isaac, is talking about here, that's getting all of their traffic from ChatGPT is using ProFound.
Speaker 1:Yeah. Right. Profound.com. It's in the back.
Speaker 2:There you go. I put it up on the
Speaker 1:Reach millions of customers who are using AI to discover your products and brands get your brand mentioned mentioned in ChatGPT.
Speaker 2:Yeah. Whether you're doing whether it's consumer product that you're selling or enterprise software Yeah.
Speaker 1:You need get on. We kind of, like we we kinda took the conversation in, like, a, an almost, like, negative situation, talking about, like, the long term durability of these businesses. But,
Speaker 2:I mean, really Well, this this is crazy because it's it's organic.
Speaker 1:Yeah. Exactly. It's like,
Speaker 2:SEO is sort of, like, faded in terms of of importance and relevancy.
Speaker 1:Like, if you can if you can be the first brand to go and find the the correct strategy on Instagram and dominate. Like, that's that's such a huge advantage. And it's the same thing with like, how did Airbnb get to scale quickly? Old school SEO. Right?
Speaker 1:They just had landing pages for every single, you know, rental homes in Tulsa. Right? Yeah. And when you Google it, you go, they're really good at SEO. There's a whole bunch of other Houston at at Dropbox.
Speaker 1:He was like, we we copy pasted the entire, like, web two point o growth handbook, which was, like, give 10, get 10 PayPal model of, like Yeah. You know, incentive based viral growth. And with Dropbox, it'd be like, I give you five gigs of storage. I get five gigs of storage. We add it all up, and it just went super viral.
Speaker 1:And they, he said something like all of the, all of the viral like, the viral growth, it's like you can go way deeper with that metaphor, which is basically like as an Internet SaaS company, you need to be sneezing on as many people as possible, which I think is hilarious. So he's like he's like, you know, to get the viral coefficient up, you need to be sneezing a lot and not washing your hands. What does that mean in the Dropbox context? Well, it means when any whenever someone clicks a Dropbox link, there's a little prompt. Hey.
Speaker 1:Do you wanna sign up? Hey. Put your email let's just grab your email before you view this PDF. Yeah. Oh oh, HelloSign.
Speaker 1:Yeah. We acquired them. Let's bring them in. And, oh, if you wanna sign a document, like, set up a Dropbox account. Right?
Speaker 1:It's like these are sneezing all over the Internet is what he'd, like, referred to it as. I thought it was brilliant.
Speaker 2:Yeah. Yeah. AngelList has has done this well with with, the roll up vehicle product. Right? Yeah.
Speaker 2:Every time every time, you know, somebody gets invited to a roll up vehicle, they create an AngelList account. They may maybe make their first investment. Yep. And AngelList can say, like, hey. Do you wanna invest in this fund?
Speaker 2:Do you wanna do this? Do
Speaker 1:wanna do that?
Speaker 2:Yeah. They're fantastic. Do you wanna read through this journal article at all? Do you think
Speaker 1:we
Speaker 2:covered
Speaker 1:it in I think we covered most of this. Basically, the the journal's asking, about OpenAI's funding challenges. We ran through this, yesterday. And, basically, my conclusion was $300,000,000,000 to Oracle is a staggering amount of money, but it does it is in line with what it takes to build, all the data center capacity for an amazon.com, a Facebook and Instagram, like meta platforms internal a google.com, not the cloud businesses. And so I can see I can imagine the spreadsheet that that that they that they used to develop the model.
Speaker 1:The question is, will the growth continue? I think they're on a fantastic growth curve. It feels like this will, that they will wind up paying a lot of this, and that and that's certainly what the market's pricing in based on the the the the the pop in the Oracle stock. It's not like Wall Street looked at the the Oracle backlog and was like, oh, that's fake. This is bearish.
Speaker 1:We need to sell the stock. No. They were like, yeah. That money's coming in. 300 billion's coming in over the next over the next half decade or something.
Speaker 1:So, like, let's send I think that was the
Speaker 2:smart frame. I think you can I think you can think that it may not materialize, but still think it's a good investment in the short term?
Speaker 1:Sure. But, I mean, they missed top of the fund.
Speaker 2:Yeah. Yeah. But purely momentum.
Speaker 1:Maybe. That's I I think that's kind of odd. It's kind of like a circular logic. Because, I mean, then you get into, like, you could say that about, like, anything. Like like yeah.
Speaker 1:Well, like, they they Yeah.
Speaker 2:I would say, like, if
Speaker 1:a bunch of peep
Speaker 2:a bunch of people are like, wow. Yeah. Oracle is gonna generate hundreds of billions of revenue from AI. I wanna own this stock. And then I'm just saying there's a category of people that are gonna say, like, okay.
Speaker 2:This stock's gonna run
Speaker 1:Yeah.
Speaker 2:At least in the short term, but maybe it's 1999 and and, you know, we're we're we're gonna see some type of, you know, correction here. So
Speaker 1:We will we will find out. We'll see. I mean, we'll we'll probably have more data on I mean, as soon as Oracle's next quarter prints, we'll see exactly how much they're pulling down, exactly how much they're building. OpenAI in the last in the last nine months has committed to spend around $60,000,000,000 a year for computing from Oracle. And this will really I mean, if this pencils out, like, this will drive a radical transformation in Oracle's business.
Speaker 1:Like, you we saw the the chart in the journal where their core business, like, that they've built up so far is basically expected to decline over the next five years as they switch to pure cloud computing. Like, they want to be a hyper Yeah. Or OC
Speaker 2:Eric, newcomer, this morning said Yeah. Being a forty eight year old database company suddenly grow by more than the size of Salesforce over the course of a trading day is one of those occurrences that makes you wonder about the moment we're in. It's at once incredible, uncanny, and terrifying, like your grandfather during a family reunion gathering everyone around, tossing off his walker, and doing parkour. Good. Very, very funny bit.
Speaker 2:Eric Eric Newcomer also was bearish on he was bearish on OpenAI at around around 30 or at least, like, very skeptical.
Speaker 1:Yeah. Maybe a year or two ago, he wrote kind of the bear case.
Speaker 2:But I think this is a very, very fair
Speaker 1:Yep. OpenAI loses billions of dollars a year and has told investors it is on pace to make 13,000,000,000 in revenue this year according to a person familiar with the matter. Less than three years since the launch of ChatGPT, OpenAI is tying its fate to a belief that companies and consumers will increase their spending on artificial intelligence at explosive rates for years to come. And I do I do wonder like, like, you have to believe in the agent to commerce story to, to to really see another, like, 10 x in revenue. How do they get to a I mean, the predict the the projection that people are underwriting open ad, I believe, is 200,000,000,000 in revenue in, like, 2030.
Speaker 1:And and it's hard to imagine, like, am I gonna pay $2,000 a
Speaker 2:month? To exist.
Speaker 1:Is everyone gonna pay
Speaker 2:200 My soundboard.
Speaker 1:Would I pay yeah. Yes.
Speaker 2:I wanna I wanna hit the air horn so bad. Yeah. Yeah. I I I think You gotta pay attention users. Yeah.
Speaker 2:You gotta You just gotta users.
Speaker 1:You can't get them all on $20 and $200 a month plans. Maybe the 200
Speaker 2:that I always give is, like, the average American, if they don't have a show they like on your streaming platform, they will just cancel it.
Speaker 3:Yeah.
Speaker 1:Yeah. Like, I mean Like, they're like, sorry.
Speaker 2:I don't care.
Speaker 1:People that just haven't upgraded, haven't I mean, people are just starting to experience, like, the reasoning models. I don't know. They're like, I I would if the if the if the paid plans stick around, like, it could be they could get a lot more people to convert, especially if it's if it goes through your business, if you're expensing it, if, like, you know, how how much do how much, how much money is spent on, like, email subscriptions across?
Speaker 2:Yeah. It'll be interesting. The an interesting comp is, like, do you think that Netflix or OpenAI will have more subscription revenue in 2030?
Speaker 1:I would say OpenAI by mile.
Speaker 2:Yeah. And you and you think that's because people will pay to have this, like, all powerful assistant that can
Speaker 1:Yeah. I mean, I guess, I the the only the only question is just, like, is there a better way to monetize? Like, can you get $20 or $200 of value out of someone by just handling their purchases than just doing the agent to commerce thing?
Speaker 2:And Yeah. And and you're not And OpenAI is not, OpenAI is completely aware that they're driving a ton of economic activity. Right?
Speaker 1:Saw it. A big company. They're like, I'm
Speaker 2:so happy that you're making millions of dollars from our product.
Speaker 1:Yeah. Yeah. Exactly. How
Speaker 2:exactly did you?
Speaker 1:Yeah. Like, I'd like you wanna keep this relationship going? Let's get it cut. And that's super valuable. That's what that's how that's how Meta generates so much money and Google too.
Speaker 1:The scale of, like, Internet commerce and taking a cut of all of Internet commerce is extremely, extremely it's just an extremely huge pool of capital to draw from. It's a huge it's a massive Thanksgiving plate to eat off of. Right? And so OpenAI deals that came to light in the past week have added up have added more than $400,000,000,000 to the market value of two companies, chip designer Broadcom and cloud provider Oracle. They also put Oracle chairman Larry Ellison in striking distance of becoming the world's richest person.
Speaker 1:Oracle's stock market value jumped over $240,000,000,000 on Wednesday after the company revealed a giant backlog of computing orders. Most of that is derived from a roughly 300,000,000,000 five year computing deal with OpenAI. Well, if you are generating media, you gotta go to fault.ai, generative media platform for developers. The world's first the world's best generative image, video, and audio models all in one place. Develop and fine tune models with serverless GPUs and on demand clusters.
Speaker 1:Don't get caught writing a $300,000,000,000 check to Larry Ellison. Just go to fall.
Speaker 2:Not today. Adobe, Shopify, Canva, Cora, and many more are on all, and you should be there too. Did we wanna tap through this? Didi was highlighting Yeah. This is
Speaker 1:a interesting story.
Speaker 2:It it's so crazy to look back at these, like, incredibly strategic acquisitions from from, you know A decade ago? Couple two two decades. '8. 02/2008. So in 02/2008, Apple acquired Palo Alto Semi, fantastic name.
Speaker 2:It's great. Really ahead of the curve. If anything if anything, they were they they created the trend.
Speaker 1:The semiconductor company of Palo Alto. Really? Yeah.
Speaker 2:The Silicon Company of Palo Alto.
Speaker 1:What's funny is there's there's also Palo Alto Networks. And so I wonder if Palo Alto Semi was directly inspired. They're like, oh, well, like, we're in Palo Alto and we're doing something similar. Anyway, you wanna
Speaker 2:I actually like this formatting. They've just Palo Alto Semi, Palo Alto Network Yeah. More than the blank of blank.
Speaker 1:So you'd just be New York browsers? The New York browsers. It sounds like a sports team. The Palo Alto semi conductors. The Palo Alto Networks.
Speaker 1:Yeah. The Palo Alto Networks We should too.
Speaker 2:We should just rename our c corp to Hollywood Content Inc.
Speaker 3:But,
Speaker 2:anyways Anyway, with the Didi says few people know about Apple's acquisition of Palo Alto Semi in 02/2008, arguably the highest ROI acquisition in tech history. The $270,000,000 price for a 150 engineers laid the foundation for all the Apple silicon chips you see today that have generated over 500,000,000,000 in value to Apple. And, anyways, he's highlighting an article from 02/2008. An Apple spokesman said Apple has agreed to buy boutique microprocessor design company called PA Semi. The company, which is known for its design of sophisticated low power chips, could spell a new feature for Apple's flagship iPhone and possibly iPod products as well.
Speaker 2:That is crazy. These these kind of acquisitions have created the set of circumstances that allow CEOs to justify these, like, un like, absolutely insane because when you get an acquisition Yeah. Right Totally. The the return is is can be as good as a as a, you know, seed to unicorn, you know, venture investment.
Speaker 1:Yep.
Speaker 2:And so but when you think about, like, the Instagram acquisition, the YouTube acquisition, Palo Alto Semi. Right? These were
Speaker 1:bit different. I I I just feel like there is an alternative scenario where they don't they don't buy PA Semi. Instead, they're just, like, poaching and, and hiring a 150 people, and it takes them, like, three years to get there, but they eventually wind up doing it. But maybe there's, like, important IP. I don't know.
Speaker 1:I wonder what do you think $278,000,000 is in today's startup economy? Like, if you go back to 02/2008, $278,000,000 feels like a block buster acquisition to me. This is Totally.
Speaker 2:That's what I'm saying.
Speaker 1:Yeah. But but is that is that a 10 $10,000,000,000 acquisition? $2,000,000,000 acquisition?
Speaker 2:Like Yeah. It's funny that, like, m and a has, like, actually out stripped, like, inflation.
Speaker 1:Well, a 100%. When you look at Scale AI. Right? It's a 20 almost $20,000,000,000 deal.
Speaker 2:For half the company?
Speaker 1:Yeah. And so I so I wonder, like, we have we really had a 100 x increase in in valuations, basically? Yeah. This makes me wanna go dig into Apple's recent acquisitions because remember on the earnings call, Tim Cook said, hey. Yeah.
Speaker 1:We're actually acquiring a company, like, every few weeks. Like, we've done basically one a month this entire year. Yeah. And everyone's been like, oh, it's boring. Like, who cares?
Speaker 1:Like Yeah. Like, these they're not doing they don't they're not buying Anthropic or they're not buying Yeah. Perplexity for 10,000,000,000. But if they have So just if they have a PA semi in the in the portfolio right now and we just haven't, like, clocked it, like, that's gonna be amazing.
Speaker 2:Yeah. So biggest m and a I'm on on Gemini. Biggest m and a Mhmm. Of the
Speaker 1:Of 02/2008?
Speaker 2:2008 was HP acquires Electronic Data Systems. Okay. It was the biggest $13,000,000,000 deal.
Speaker 1:Like a huge merger of massive companies.
Speaker 2:Oracle acquires BEA Systems, which was a business software company I'm not familiar with.
Speaker 1:Love it.
Speaker 2:But I love business software.
Speaker 1:Me too.
Speaker 2:6,700,000,000.0. Google acquired DoubleClick for 3,100,000,000.0.
Speaker 1:That was the huge acquisition. Yeah. That's amazing.
Speaker 2:Which in hindsight, like, you know
Speaker 1:It became
Speaker 2:a back of acquisition. Yep. And BusinessObjects was acquired by SAP.
Speaker 1:I like BusinessObjects. That's a good name.
Speaker 2:No make. Yeah. It's like, we don't know how to name companies like this anymore.
Speaker 1:Objects. That's so good. So The business company.
Speaker 2:There was, yep, a ton of, like, multibillion dollar m and a that year. Good. But it does feel like if Apple were to acquire, make a super strategic acquisition today I mean, they were who knows how real, like, the perplexity rumors were. Right? They were you know, Apple was under pressure to make an AI acquisition, but it didn't feel like Apple would ever get to the point where they would buy Perplexity for 18,000,000,000 or whatever they wanted out
Speaker 3:of it.
Speaker 2:It's odd for It was like when you look
Speaker 1:at an application layer company. They really don't buy a lot of applications. I mean, they bought, Shazam, I believe. But, a lot of times, they're what they're buying are these underlying hardcore teams that are gonna create the foundation of the next hardware wave for them. Like, in the lead up to the Vision Pro, they acquired I mean, you know you know someone who sold a company to them that went into their VR portfolio.
Speaker 1:Correct? Like, like Yeah. That is the Apple playbook is we have a vision. We're gonna do VR or or augmented reality in a decade, or we're gonna do car, or we're gonna do custom silicon. And so let's start hiring, acquiring, little little investments here and there, here and there, and here and there.
Speaker 1:They're not just gonna go out and be like, we're trying to buy Waymo. Or, like, we're trying to buy the the the best asset. They kinda opt for, like, Fifth Ave.
Speaker 2:When they bought Beats for Yeah. Point 3,000,000,000, Beats was doing, like, 1,400,000,000.0 of revenue. Sure.
Speaker 1:Sure.
Speaker 2:Trailing twelve months. Yeah. So Yeah. Exactly. Again, it was a very, you know
Speaker 1:So running reasonable. Acquisition. Didi has the story. Pay a semi special specialized in power efficient chips with power PC chips that, delivered 300% more performance per watt than Intel Xeon at the time, which I believe was their server chip, Founded by the late Dan Doberplu, DEC alpha and strong-arm legend, in 02/2003, the team had expertise in low power architecture that Intel couldn't match. The acquisition gave Apple the dream team that would create the a four chip in 2010, launching Apple silicon dominance.
Speaker 1:Key engineers like Jim Keller, g Williams the third, and Johnny Srouji, architected the a series that powers two plus billion devices today, crushing Qualcomm's monopoly. This philosophy evolved into the m one's twenty plus hour battery life that's powering this laptop right here. Loads
Speaker 2:of Do you get twenty hours out of that bad boy?
Speaker 1:I'm plugged in right now. I'm not risking it while we're on the stream, but I I think we could maybe get twenty twenty hours if I was, you know, low low dim, screen brightness and maybe not connected to the Wi Fi, maybe just in a text editor with a dark background the whole time. And it also had a 3.5 x faster performance than Intel at one third of power. The m line of chips today powers Macs, iPads, and Vision Pro. Without PA Semi, there may never have been an iPhone processor independence, iPad dominance, no Apple Silicon Macs.
Speaker 1:The small investment, a series a a round a series b round today has generated 500 plus billion in value strategic acquisitions like this can make the break make or break the future of a business. And if you what else? Turbo Puffer. It's on the skits of
Speaker 2:We're puffing.
Speaker 1:We're puffing. Search every byte, serverless vector, and full text search built from first principles on object storage. Fast, 10 x cheaper, and extreme extremely scalable. Pretty much used by every Curse
Speaker 2:company we've been able to find. There's a bunch of logos that they have that are absolutely crazy that they don't even they're not even listing on the website. Yeah. So a lot more to come from Turbo Puffer in the near future, but for now, get on it.
Speaker 1:Did you wanna go through this post by Ajni Midhad and Vincent?
Speaker 2:Yeah. I thought this was I thought this was, a couple things as you could read into this. So many v he says, many VC firms are being asked by their LPs how they so utterly miss the entire 20 to 25 cohort of frontier AI startups that are now category winners. Worse, they're being asked by the same by next gen founders. I've never seen so many traditional investors become obsolete so fast.
Speaker 2:So It was like if you think about if you think back, like, the twenty twenty twenty through 2025, you had ZERP where just every category was going crazy. Mhmm. And then you had like like fintech was super hot, crypto was super hot. It was easy to get kind of like if you were if you were a generalist VC, a lot of generalists like decided, I'm gonna go just be a crypto investor. Yep.
Speaker 2:Or or I'm gonna focus really heavily on fintech. And then you also had the the sort of American dynamism boom, which people were were drawn to in different ways. And and but when you look back at when you look back at when some of these leading AI companies were started
Speaker 3:Yep.
Speaker 2:It really was, like, 2022 during, like, a time where a lot of VCs were, like, trying to, you know, do, like, basically damage control on the on their portfolios. Right? They had funded a bunch of companies, like, at at insane multiples. We started seeing, you know, a real kind of, like, correction in in in venture. And and if if you just, like, weren't really didn't have your eye on the ball and weren't, like, seeing kind of the future, you missed a lot of.
Speaker 1:Yeah. And when I see when when I think about the cohort of Frontier AI startups, who do you put in that bucket, in that cohort? 2020 to 2025. Like, if you're a if you're a traditional investor that doesn't wanna become obsolete, what logos do you want on your portfolio page? Well, so the It signal to the next generation of founders and LPs that you did not utterly miss the entire twenty twenty to twenty twenty five cohort of frontier AI startups.
Speaker 1:Put it in that bucket.
Speaker 2:First example that came to mind was, like, Listen Labs. Right?
Speaker 1:Okay.
Speaker 2:$6,000,000,000 company now. Started in 2022. Yeah. Seems like it, you know, seems very obvious in hindsight. But if in 2022, you had, like, funded, you know, 15 fintech companies and we're trying to figure out what was gonna happen to them as interest rates were spike you know, spiking.
Speaker 2:Mhmm. And and you were distracted by crypto. You just, like, didn't you know, you weren't there were people that were locked in on AI. Right? People that I the the people that I that come to mind is like people like Elad Gil who are in a lot of these companies.
Speaker 2:Right? The the a lot of the platform funds, like, mean, obviously, Anjane at at Andreessen is is there in a lot of these companies, but they're multistage. Right? So it didn't matter if you didn't have to catch them at at series a Yep. Or seed, although they they caught plenty.
Speaker 2:And so and then the other thing is, like, if you're not in if you're a platform VC and you weren't in any of the winning foundation models Yeah. Like, what what were you doing?
Speaker 1:Postla has a fantastic story around early OpenAI. Thrive has a fantastic story around early OpenAI. Then there was that first, like, pre like, right around the right around the moment ChatGPT happened, I remember there was a big round, and a lot of investors got in there. And it was around it was in the tens of billions. And it was a crazy valuation to kinda come out of the gate with.
Speaker 1:There was already this Microsoft deal. It was a complex thing. You had to take a ton of risk on the nonprofit for profit conversion. But
Speaker 2:Yeah. There was there to be clear, there was plenty of reasons not to do
Speaker 1:100%?
Speaker 2:OpenAI. 100%. Not like, whether it was pricing, the structure, there was
Speaker 1:plenty of meme about, the model the foundation model layer will commoditize. Right? Yeah. And so if you fell for that meme, you are not in
Speaker 2:And then there was a meme of, like, the application layer. It's there's no value. There there was a period where people They fell for both of felt for I just felt like a mid curve both of them. Just just and then you're sitting here. You got no foundation model bets, no no application layer bets, and you're and and you're like, well, even the new foundation models are too expensive.
Speaker 2:I can't do those. And then this company is just like a trying to fast follow that company that already broke out. Yep.
Speaker 1:Yep. So, I mean, when I think about the the twenty twenty to twenty twenty five cohort of Frontier AI startups, yeah, I think Eleven Labs fits in there. I think mid journey, no one got into. I think, I would put DeepMind. You you couldn't invest because that was with Google, but it's gotta be, OpenAI, Anthropic, or a few of the other major, like like, application layer companies that have done very well.
Speaker 1:And if you're in those even if it was a growth round and you got in later, if you at least built a position and have something going on there, it seems like you kinda check this box. But it is it is an interesting, it is an interesting question to to to phrase. You gotta you gotta buy fifth ad sometimes.
Speaker 2:That's right.
Speaker 1:Linear. Linear is a purpose built tool for planning and building products, meet the system for modern software development, streamline issues, projects, and product road maps.
Speaker 2:I think linear.ai. I think all the breakout AI companies are already running on linear, and you should too.
Speaker 1:Well, we have some news from Dylan Patel over at Semi Analysis. Another giant leap NVIDIA Rubin CPX specialized accelerator and rack inference prefilled specialized GPU. Dylan says NVIDIA has widened the gap for inference rack scale architecture yet again. Prefill specialized inference chips massively lower total cost to own per million input tokens on long context transformers. As usual, other AI chip upstarts will follow this with prefill specialized chips, later.
Speaker 1:And so yet another bullish take for NVIDIA. Everyone's competing. Following the AMD story has been interesting. Dylan's been been pushing AMD to fix some of the bugs, get more serious about AI, really, talk to the developer community, engage with the developer community. AMD was doing that, was seeing some some positive some positive early signs of being taken more seriously.
Speaker 1:George Hotts was on the team a little bit. But but has since, like, pulled back and, you know, Jensen sees semi analysis too and can see, oh, AMD is coming for my lunch. I'm gonna step on the gas. And it seems like, yes. So congrats to everyone over at NVIDIA for putting on a putting on absolute clinic clinic in in Raphael's friend.
Speaker 2:Jack Fields says well, he's quoting Sam. There's not a single person in the world who needs a two terabyte iPhone 17 Pro Max. Jack Fields says slaps car roof. This baby can fit so much other in it.
Speaker 1:Is that a thing? Like
Speaker 2:Yeah. If you look at if you look at it, like Storage. Storage, there's, like, a category called other.
Speaker 1:And is it big?
Speaker 2:Is that just Usually Eyewear? It usually is.
Speaker 1:It that's a bad sign if I have other going on. I have a one terabyte iPhone, and I don't have any other. I have no other. My my my phone is applications, and then little
Speaker 2:bit Other I I think this
Speaker 1:podcast TV
Speaker 2:I'm looking now. I don't I don't have system data. I don't have it anymore, but there it used to be
Speaker 1:Oh, a little throwback.
Speaker 2:It used to be the other. It used to be a much bigger
Speaker 1:Well, they've done a lot better exposing where the data is actually stored. I think, you know, the two terabyte phone that feels like it's for, someone who Mister Beast.
Speaker 2:Filming, you know, his entire Yeah.
Speaker 1:And and, specifically, the new phones, 48 megapixel cameras, Genlock, you can run them for a long time. Better heat management, so you can probably record for ten hours if it's plugged in. No problem. And then you're saving all of that footage, and you can record in raw video now, raw, so that those are huge files. So there is a world where if you're using this as a production tool, I saw another take that was, like, the the iPhone 17 Pro gets you ready for the $2,000 iPhone.
Speaker 1:Like, the like, mentally, that's a that's a threshold. That's a Rubicon that everyone has to cross. And, and and maxing it out and offering that level of performance and saying, hey. Look. We're we put Pro on it.
Speaker 1:Like, you have to be using this in a professional context. Like, you should be expensing this. And for someone like MrBeast who says, yeah.
Speaker 2:I want So funny. Every every every camera company just being like or Apple's not, you know, Strat. Like, they're really they're really, you know
Speaker 1:We might see his place in that with the iPhone soon. I I think the
Speaker 2:Watch out, Sony.
Speaker 1:Watch out, Sony. Sure.
Speaker 2:Cook wants your lunch.
Speaker 1:He's cooking. He's cooking. Naveen Rao is leaving Databricks, a little bit of a trade deal, a $100,000,000,000 startup, to build a next generation computer to shrink AI compute costs, and Databricks plans to invest. That's bullish. Databricks sits around $100,000,000,000 and just raised one b.
Speaker 1:They're also at a $4,000,000,000 run rate. Congrats to Databricks, which we had our Gong. The core problem for the AI industry is that large models are limited by memory bandwidth, Internet interconnect latency and power, so every token can be can produce can be too expensive. A purpose built computer may tackle those costs by bringing memory closer to compute, wiring chips with faster link. Is this data center focused or or, or something that would actually sit on your compute on your desktop?
Speaker 1:Does this is this a George Hot's Tinybox competitor? I'm not exactly sure, but, congrats to Naveen Rao on the new gig. We will be following the story and monitoring the situation. Big move. We'll try to get
Speaker 2:him on.
Speaker 1:When you tell those computers, make sure you're on numeralhq.com, Naveen. Sales talks on on autopilot. Spend less than five minutes per month on sales tax compliance.
Speaker 2:Auto van Von Twitmark. Twitmark. Auto Says, can you shorten an entire country? Referring to Albania. Albania is appointing an AI generated governor government minister to govern the country's finances.
Speaker 2:Apparently, they've had so many issues with with with, like, corruption and fraud.
Speaker 1:They're
Speaker 2:just like, oh, let's just, like, make an AI.
Speaker 1:Yes. No one's gonna no one's gonna prompt inject.
Speaker 2:The top comment is their their alternative is in Albania.
Speaker 1:So
Speaker 2:I don't I've never really I I don't I don't think I know many Albanians. I don't know.
Speaker 1:Apple has some wild stories about going to Albania, I believe. Yeah. I don't wanna dox too much, but he has some he has some funny stories. Hopefully, we can get him to share them on the show.
Speaker 2:It's It's in the
Speaker 1:The idea of, like, let's just use an AI for to to to, like, clean this up. It's like, that's who's prompting it? Like, are they reliable?
Speaker 2:Well, what if they're I mean, Miramaradi is Albanian. Yeah. Albanian Americans so they could get thinking machines.
Speaker 1:There would be a pretty crazy story of what what's it called? Sovereign AI? It'd be a sovereign AI story.
Speaker 2:I don't know. I don't know if they're Well claiming that it's that it's their national champion yet. She Not yet. Albanian American.
Speaker 1:Yeah. Well, if, if someone in Albania needs to, chat with someone about their tax return, maybe they could get on fin.a I, the number one AI agent for customer service, number one in performance benchmarks, number one in competitive bake offs, number one ranking on John,
Speaker 2:I've been I've been informed that, back home in the studio, the whole team is clapping along with us during the during the during
Speaker 1:the Hopefully, there'll be audio mix in and everyone Yeah. Everyone goes for Gary Tan had a post. AI startup founders tout a winning formula. No booze, no sleep, no fun. But Gary Tan disagrees about the no fun, though.
Speaker 1:And this is from The Wall Street Journal. San Francisco
Speaker 2:This is the vibe right now.
Speaker 1:Startup founding. And we talked to a few of these folks. One of these guys, came on the show, just, at YC Demo Day, actually. So, fascinating. And and this was a this was a second, this is clearly, like, a story that was inspired by that previous story of that that that founder who said that the vibe's nine nine six.
Speaker 1:No run hard, lift heavy, marry early, that whole that whole viral quote. This is, probably, like, downstream coverage of that. But, in San Francisco, startup startup founder Marty Causus was at the office on Sunday. Where else would he be? Causus, 28 years old, recently posted on LinkedIn that he put in three ninety two hour weeks in a row.
Speaker 1:He went on vacation once, he said, but flew home early because he was too stressed about work. His goal is to build a $10,000,000,000 company in ten years. The motive isn't purely financial. There are easier ways to make money. This, it isn't part of a social mission either.
Speaker 1:We built customer support software. It's not like this grand vision that we're saving the world somehow. He compared his pursuit to a board game, one he wants to win. I could be a programmer working at a big tech company, he said, but that doesn't sound cool. Instead, he raised $51,000,000 for Pylon, an AI startup he cofounded.
Speaker 1:Congrats. Si's gone for that. Yeah. I was just reflecting on this this this whole vibe and the coverage of this vibe and thinking about when I got to Silicon Valley and Yeah. What was similar and what was different.
Speaker 1:And so
Speaker 2:You didn't have a PR person working overtime coverage. That was your mistake, John. I I know you only raised, like, $17 in your first round.
Speaker 1:Raised $17,000, and, there was no concept of going to the office because the office was my bedroom, and my cofounder lived in the same bedroom as me. So we had two beds in the same room. We would wake up and go sit at the same desk next to
Speaker 2:each other. Like a real lock in because because you don't even have a private life. Right? Like, there's not you have nothing.
Speaker 1:Nothing. It's purely like, there was there's one local bar that we went to once in Sunnyvale because there was nothing to do. But we would we would go outside and we'd throw the football. Pigskin? Yeah.
Speaker 1:The pigskin. We would go outside and get some sun and throw the football back and forth and then go back inside and just program. And my and my day was literally, like, wake up at noon and because you're not having calls. Wake up at noon, program until 4AM, fall asleep, do the same thing the next day, seven days a week. And there was no there was no alternative.
Speaker 1:And this other like, we are also in this weird I mean, also, I wasn't 28. I was I was 21 at the time.
Speaker 2:It's funny because the saying, like, I put in, like, three like, obviously, respect Yeah. To Marty. But saying I put in three ninety two hour weeks is another way you could say, like, for the last three weeks, I've slept and ate and done normal human things for about twelve hours a day. Yeah. And the other twelve hours, I spent working.
Speaker 2:Yeah. It doesn't hit the same as three you know?
Speaker 1:Yeah. It is it is it is wild. But I don't know. I mean, in in general, like, if this is a if this is there was there was a time in Silicon Valley also that, you could raise enough money that you could just immediately be on, a party circuit. And, like, clearly, this is a step in the right direction away from that.
Speaker 1:It's, like, actually taking business seriously. So hugely bullish overall. It's just funny, like, thinking about, like, like, the money flowing. Like, there were not that many companies in 2012 that were raising, like, double digit millions, but then there weren't that many companies making money. Like, we certainly weren't.
Speaker 1:We had no users. So, like, who was gonna fund us? Like, $17,000 was the right amount of money to give us. Like and, also, it's not like we were being recruited by big tech. Like, if I tried to get
Speaker 2:a job there, I'd be like, no. The capital markets were efficient.
Speaker 1:They were. They were. Like, it was like, I didn't deserve more than 17 k. I wasn't that experienced. Like, I was just trying to, you know, like, do something, build build a way.
Speaker 2:It is a it is a you know, it's very real that, like, a lot of founders would benefit from, like, having their first fundraise be, like, a $100,000, which is just enough for them to like hack for two years and not have to get a job. Yep. But the current the current state of the capital markets means that if you're like talented and charismatic and compelling and you have an interesting idea, you can get at least a million Yeah. Probably well beyond that.
Speaker 1:Yeah. Yeah.
Speaker 2:Yeah. At at demo day, like, it was very obvious Yeah. For the most part when I you could tell. Yeah. I pretty much was guessing every time.
Speaker 2:Was like, let me guess your round's closed.
Speaker 1:Closed. Yeah. I mean, yeah, in in in in 2012, like, I think there were probably, like, five or 10 teams that, like, raised solid rounds coming out of, like, an 80 team batch. Like, it was it was not it was not snap your fingers and the money shows up. The I mean, the hottest, like, most overheated round was done at, like, 60.
Speaker 1:And everyone was like, this is a bubble. This is insane. There's one company.
Speaker 2:What company was that?
Speaker 1:There's a company called Viral, and they were actually really good at viral videos. And they they were great at video production, and they built an ad network and were doing sort of, like, some programmatic ads. So it's more like an ad business than like, I I don't think they ever fully stuck the landing on, like, becoming, like, a major platform. Like, I I don't think that they IPO ed or anything. I know the founder's done quite well and has, I I think, a number of businesses.
Speaker 1:But they they launched a few, like, extremely great launch videos. They I feel like they almost you could almost go back and credit them with, like, creating the original launch video. You should look up v I r o o l, like, launch video on YouTube.
Speaker 2:V I r o o l?
Speaker 1:By rule. Yeah. By v I r o o l. And the whole idea was, like, they would get you to go viral, and so you'd pay them. And then they do
Speaker 2:It's still a comp I mean, it's still
Speaker 1:It's still going. It's still cooking. Well, Alex Deb Debilov, I believe, is the founder. Great guy.
Speaker 2:Still have 50 LinkedIn says, I don't know. This company looks pretty dead.
Speaker 1:Okay. Well But Ah. I mean
Speaker 2:Oh, it's it's now called I guess it was a
Speaker 1:I mean, the founder, it was super young, and and I met him in college, and it you know, it was just like he really was the type of person that you would want to fund at 60 because, like, he was making money in his dorm room, like, hand over fist too. Like, had actually scaled the ad network and was, like, bringing in real revenue and real profits. It was just maybe, like, it wasn't necessarily gonna turn into, like, you know, AdWords because he didn't have, like, a Google attached to the front of it. It's still, like, super impressive business. Right?
Speaker 1:But they had worked with this, video production company called Glass and Marker, which I wound up working with later, sort of like a precursor to Sandwich Video, a precursor to a Jason Carmen production, and was particularly good at, at creating this, like, just super cinematic, like, Hollywood level video production for, like, a launch video. And they they they put out a few that were really good. I remember that, like, SWAT team going in, pulling in, like, this, like, blue, this, like, blue goo that was, like, radioactive, and it was like, you gotta get the formula to go viral. It was great. Are you throwing them on there?
Speaker 1:Virool, v I r o o l. Alex Debilov, if you wanna come on the show and tell us the full story, hit me up. The moon. Probably the moon. Well, they yeah.
Speaker 1:They were they were going to the moon. Yeah. The the other funny thing that I I I like is this, so, like, you know, the the the these teenagers that they interview interviewed said, the brass ring is a trillion dollar company with a global user base. To grab it, they rarely drink, scoff, and work life balance and are locked in a twenty four seven competition to be or appear to be the most obsessed. The there's a framing there's a one framing, which is like, I don't drink because, like, it's like, I've done the research, and it's a carcinogen.
Speaker 1:It's bad for my health. There's another one which is like, I I don't drink because it's, like, sacrificing because, like, I care about work. Like, for me and my friends, it's, like, we we would drink every drop of alcohol that we could afford.
Speaker 2:It was just not that much.
Speaker 1:And so we had, like, three beers a month because, like, that was what we could afford. And we and we did not we it was like, yeah. Like, if we're going to Costco and getting, like, a huge box of ramen, like, it's gonna be a consideration if you take the 30 rack in the in the bag. That's gonna hurt your burn rate. When you're on $17,000 for six months, like, an extra $30 in beer is, like, material.
Speaker 1:Yeah. It's it's a serious
Speaker 2:Yeah. I was hacking Chipotle, you know, with the, like, double beans Yep. Double rice because it didn't add anything. And then Yeah. Then
Speaker 1:You're not being like, yeah, throw a corona in there with my with my meal at Chipotle. No way. But
Speaker 2:I used to go to I used to go to this is will be funny to you now, but I used to go to the the first, like, 20 trips I took to Eirwan, I didn't go in the building. Yeah. I would just bring jugs of water to fill up in this thing outside. That's great. And I'd pull up with my car that had, like, 200,000 miles on it and just, like, just be, like, you know, carrying these huge jugs of water.
Speaker 2:Yeah. Fond memories.
Speaker 1:Here's here's the trade off. Why would I go to drink at a bar if I can be building a company? I mean, it is the right trade off, and it is the thing that you don't wanna lose as the capital markets loosen. Right?
Speaker 2:This is such a this all the people that are, screenshotting this article Yeah. Why would I go drink at a bar if I could be building a company? That is a really
Speaker 1:Yeah. It it there there is a little bit of this that's like that's like the the the whole the whole question The Wall Street Journal is clearly asking here is, like
Speaker 2:I don't even like I don't like bars, and I don't like drinking, but this is still a funny quote.
Speaker 1:Yeah. Yeah. No. I I I understand what you're saying, and I understand what people are are are screenshotting it about. But the the the interesting thing is, like, if the money starts flowing in Silicon Valley, like, the thing that you would definitely not wanna lose is, like, the time in the office.
Speaker 1:Like, the time actually working. Like, that's the worst thing to lose. And so Yeah. Even even if you have to justify it in this, like, you know, psychological way Yeah. It's it's good not to lose that.
Speaker 1:Yeah. Because as soon as you'd actually go to the bar every night, like Yeah. Definitely not be able Yeah.
Speaker 2:I was thinking I was thinking, like like, I've always felt I had, you know, somewhat of a balanced life. Right? I've had we we we realistically, we work, like, sixty hours a week and that, we leave home at
Speaker 1:Yeah.
Speaker 2:Somewhere around five.
Speaker 1:It's pretty balanced.
Speaker 2:Get home around 05:30, and then obviously working randomly on on, you know, nights, weekends, etcetera. But I was thinking, you know, people say, like, social life, work, like, you know, family, like, pick two. Yep. And I realized recently took me a while to realize, like, how much I sacrificed, like, my I I, like, social life. Right?
Speaker 2:Because I feel like I have a social life at work and Yep. And I'm lucky that a lot of the people obviously consider every person on our team
Speaker 1:Yeah.
Speaker 2:A friend. And and the people that I invest with are friends, and the people that I work with are friends. But, yeah, you do have to this this is just this culture of, like, sacrifice everything but the company works really well when you're 20 when you're when you're in your early twenties, mid twenties, depending on when you
Speaker 1:I think we I think we found the ultimate killer in this article. Hassab Ulla, he works at a Founders Inc, a waterfront campus in Fort Mason that provides desks, a hardware lab, game room, stage area for hackathons. He lives on one that eats meal per day to save time and avoid cooking. Ola pays $700 a month to live at a former office building that was converted to a living and workspace for about 20 residents. The beds, are clustered in a common area, are fully enclosed pods.
Speaker 1:He literally lives in the pod, with a privacy curtain similar to a train sleeper car. With the curtain shut, his pod gets pitch black letting him sleep days after working all night. This guy is a killer. I'm betting
Speaker 2:on him. I it. Dog.
Speaker 1:This is not a LARP. $700 a month is so little to live on in San Francisco. I assume that's where this is, Founders Inc, Fort Mason.
Speaker 2:He's living in the pod.
Speaker 1:He's living in the pod. He's locked in.
Speaker 2:It is funny it is funny to do to do
Speaker 1:Shout out to this guy.
Speaker 2:You would think he could maybe eat two meals if he didn't do Uber Eats and he just walked to to grab some food, but Maybe. He's too locked in.
Speaker 1:Too locked in. Yeah. I I think it's probably worth the trade off. But yeah. I mean
Speaker 2:This is still I gotta put I gotta I gotta say, like, getting delivery is still an extreme luxury. It's still a luxury. Back in back, I would not when when
Speaker 1:We used to.
Speaker 2:When when I I would not to get I was, like, on a, like, once a week, like, your your your mom says you have, you know, x y z at home, but that was, like, in my own head. I'd be like, I have food in the fridge. I'm not Okay. I'd be and I'd be guilty, you know, being you know, ordering ordering delivery.
Speaker 1:I I remember one one one night I was up, like, really late working. I boil some water in a in a pot to make ramen. And I and I got sucked into a coating problem, and I let the water boil and evaporate, and it destroyed the pan. And it was like, that's our CapEx out the window. Right?
Speaker 1:It was devastating. Devastating it to depreciation. Like, we were expecting to depreciate that asset over two years, and and now we have to buy another pan. Like, what are we gonna do? We don't have a pan.
Speaker 1:Pans are expensive. Money doesn't grow on trees. We're you know, we only have 17 k. It's rough.
Speaker 2:Kausas, the the guy, the the original guy from Pylon is on the Brian Johnson diet.
Speaker 1:Okay. So Well, he's raised $51,000,000. And and and to be clear, I do think that, like, all of this is proportional. Like, if your business has grown to the point where you can raise 10,000,000 or 50,000,000, like, you do not be you do not need to be living in the pot of any of that. Or, like, pay yourself a reasonable wage.
Speaker 1:As soon as we raised real money and we're making real revenue, like, we were in, like, decent apartments with cleaning and, like, with,
Speaker 2:like And it's amazing to feel like you you you have, like, a relatively the the lifestyle of, a corporate athlete Yeah.
Speaker 1:Yeah. Yeah.
Speaker 2:Or or even just an entry level corporate athlete, but it still feels like a massive luxury.
Speaker 1:A 100%.
Speaker 2:Like, my my
Speaker 1:800 square feet in a When I when I yourself.
Speaker 2:Moved yeah. When I first moved to LA, I had a apart my apartment, it was a it was a two bedroom apartment that I I had a roommate. So I felt lucky to have my own room, but I had no windows in the room because the window opened up to like a common area at at eye level. So if I had my if I didn't have like I literally put cardboard up. If I didn't have cardboard up, people would just see into my bedroom.
Speaker 2:Was like Yeah. And then That's hilarious. Super dark. But this this quote is hilarious. He said his ideal employee for a sales role at the startup is a quote, unquote PhD, poor, hungry, and desperate.
Speaker 1:I like that. That's good. You're
Speaker 2:get Grinders.
Speaker 1:You're get grinders. People that wanna be on the on the upside Yeah.
Speaker 2:There there should be a term for somebody who fasts until their next, like, steak sales dinner. Like they only eat Oh, for sale. When they're closing. I only eat when I'm closing, like a real hunter on the
Speaker 1:This
Speaker 2:is on the Savannah.
Speaker 1:Pretty crazy. Nico Lockwaffe, 25 25 years old, wants to build a trillion dollar company with the goal of replacing traditional insurance companies. His father is a lawyer from the insurance company, so he only hires people willing to work seven days a week. Of his 40 plus employees, around 30 are ex founders. That is a crazy stat just because, like, it really speaks to the to the amount of founders that exist in the Bay Area now.
Speaker 1:Like, in in you could not I mean, this happened. Like, are, are you familiar with the Y Scraper instead of the sky Skyscraper? There was there was a this is in maybe 02/2008, 02/2010. There was one building where all of the YC companies lived after they graduated from Mountain View and went to San Francisco. Call it the Y Scraper.
Speaker 1:And and there was a and there was enough of so you have you have stories about, like, Coinbase working right next to the Airbnb guys. I don't know if that's exactly right, but, like, you you could imagine a few different big companies coming. Yeah. And it was like, if one company failed, it would just be like, okay. Come over to this company.
Speaker 1:Like, join forces. But but you couldn't necessarily do that to the tune of 75% of the workforce in the first 40. That's that that that feels new, and it feels like a a a an example of how Totally. How much more popular entrepreneurship is these days. He says he lives at the what he lives at the office, Lockwa said, who considers himself the most hardcore of his peers.
Speaker 1:Employees share similar feelings. Though not a work requirement, Lockwood said two thirds of our early employees got corgi tattoos. That is hardcore. Wow.
Speaker 2:That's great.
Speaker 1:I I have no tattoos. I've I've never been big into that world, but that is certainly a commitment. Hopefully, you own the IP. I do not
Speaker 2:need So so interesting. This company, I'm I'm on Nico's LinkedIn, and this is a stealth startup still. Well, he's not No. You're not. You're you're in the They're getting tatted in the journal, and you're tatted you're tatted up.
Speaker 2:I think you're you're safe to come out of stealth.
Speaker 1:Yeah. Hopefully, you have the IP locked up. I went through YC with a with a company called Pear that was a, think I it was it was, like, an app for you and your significant other. And so it was a imagine a social network. Basically, all the features of iMessage you know how now in iMessage, can, like, see all the photos that you've shared between you and one person.
Speaker 1:So I can pull up, like, our iMessage, and I can go into that info panel and see, like, here are all the links that Jordy sent. Here are all the images. I can send you little stickers and and all sorts of different stuff. Pear was that for, like, a romantic couple so you could, like Yeah. Draw to each other, had all these, like, fun little games and stuff.
Speaker 1:And Pear wound up getting sued by Pear Networks. And they were like, woah. Woah. Woah. Like, we are a consumer dating, like, messaging app for, like, a husband and wife to share their life together.
Speaker 1:You're a networking company, pair networks. Like, you sell into data centers.
Speaker 2:Yeah.
Speaker 1:Like, why are you suing us? And they were like, no. You're a technology company. We're a technology company. You have to change your name.
Speaker 1:Yeah. And so they did, and they became couple, and it was like this huge, huge difficult thing. So, anyway, the importance of getting your name, IP lockdown before you get the tattoo.
Speaker 2:We have an important Are
Speaker 1:you thinking about a quote?
Speaker 2:Yep. Ad. So Sandra's in the in the YouTube chat. Okay. Cool.
Speaker 2:It says, can we get Founders Podcast on the Oh, absolutely. We didn't add you because this was so schizo Yeah. We wanna
Speaker 1:dye you, but you are really the godfather of podcasting, created the cat
Speaker 3:Yeah. I
Speaker 1:don't think I don't think we can see up there. I don't know. We'll have to we'll have to see. We can't we can't see you up there. You have a ton of space to your left, though.
Speaker 1:So get down and go keep going to the left past vibe coding and past Discord, to the left past Larry Ellison. That whole area, you got, like, three feet to work with over there. You can draw massive stuff. There we go. Here we go.
Speaker 1:Oh, yeah. This is good going downwards. This is perfect. Okay. I'm I'm seeing everything.
Speaker 1:We're good. Lockwell regrets getting his Columbia University degree, he said, because he wasn't solving societal problems in class. I always wanna do the maximally ambitious thing I can think of and make the biggest impact possible. Yuan, the Corgi cofounder, said her life too centers around work, which across the startup scene is populated largely by men. From a personal perspective, I don't mind it as much, but it does suck to see not that many women in startups.
Speaker 1:Jared Friedman, partner at Y Combinator, said the work ethic and energy of San Francisco's young founders feels like a return to the early days of the Internet, and I agree this. This is a great take. When people slept under under their desks at companies such as PayPal, I actually see it coming, as a as a full circle moment. AI is probably 10 x as big. Friedman said the tech Yeah.
Speaker 2:I mean, it's very helpful if you have, you know, five to 10 other heavily funded companies in your category. Yeah. And so capital is not really a constraint for anyone. Yeah. And it just comes down to raw execution.
Speaker 1:We just conference Senra in right now on this?
Speaker 2:Yeah. We gotta ask him about
Speaker 1:I I we gotta call Senra and and and get him get him get him tell us about the sleeping under your desk. Should I give him a call? Senra. Let's see. Let's see if he's available.
Speaker 1:I'm I'm I'm calling him. I'll put him up if he's available. He's in the YouTube chat, so hopefully he can come on the show. I totally emphases. Hey.
Speaker 1:How are you doing?
Speaker 2:You're live.
Speaker 3:Did you need to call me?
Speaker 2:Yeah. Yeah. You're live.
Speaker 1:We saw you in the we saw you in the chat.
Speaker 2:We got Natalya liaison. We're doing a we're Happy Friday, man.
Speaker 1:We're doing a whole deep dive on this Wall Street Journal article about the the young founders in San Francisco who are working twelve hours a day, six days a week. There's a bunch of examples.
Speaker 2:Yeah. So we wanted to ask you, is hard work important?
Speaker 1:Or is it overrated?
Speaker 3:Go to an article about people working part time?
Speaker 1:No. No. No. Working hard. Hard.
Speaker 1:And hard. And the article on this The article is framed as, like, as, like, are they working too hard a little bit? Or, like, is this a LARP? Are they pretending? And, we wanted to go to the source and get the get the final answer.
Speaker 3:They do with the other
Speaker 1:That's what Jordy said.
Speaker 2:That's what I said. It's like, put differently, they're they're spending eight hours a day sleeping, four hours a day, you know, speaking. We're doing whatever they want.
Speaker 1:Netflix, I guess.
Speaker 2:I'm like, what would I what would my what would our lives look like if we didn't have five kids?
Speaker 1:It's crazy.
Speaker 2:Like and wives that we I don't know. Yeah. Obviously.
Speaker 3:Sorry. But that's part time, buddy.
Speaker 1:996 is part time. Breaking. David Senra has called it. Working nine nine six is considered part time in the founders podcast world.
Speaker 3:That's good. Did you guys ever I know you're into, like, bodybuilding. Did you ever read the education of a bodybuilder by Arnold Schwarzenegger?
Speaker 1:No. I should. Sounds fantastic.
Speaker 3:Like that. Okay. So somebody posted, like, the great lock in, and it's just, like, nine episodes of founders.
Speaker 1:Yeah. Oh, I saw that. I think.
Speaker 3:So one of them, I think, is Arnold's. So Arnold wrote two autobiographies. One, we use a 70, which is fine.
Speaker 1:Yeah.
Speaker 3:But the way more extreme one, wrote when he was 30.
Speaker 1:Oh, wow. That's young.
Speaker 3:So the first half of it is really, like, a hundred and ten ten page biography. Right? Biography. And then the second half is, like, his workout routine, which another 100 pages. But it basically, he would you know, people were just like, yeah.
Speaker 3:I work twelve hours a day. He's like, so what else did you do with all the fucking time?
Speaker 1:That's the word.
Speaker 3:He's like, you're not
Speaker 1:working now. Wow. Yeah. That's awesome.
Speaker 3:I I I don't wanna get kicked off stream, but he tells us something to do the PG version of this.
Speaker 2:Mhmm.
Speaker 3:This is before he made it to America. Right?
Speaker 1:Yeah.
Speaker 3:So he would go to, like him and his other bodybuilder friends
Speaker 1:Mhmm.
Speaker 3:They'd go to, like, this forest out in Austria or maybe in Germany, and they would bring a bunch of women, and they'd bring a bunch of, like, beer and food, like schnitzel or whatever that is.
Speaker 1:Schnitzel. Okay.
Speaker 3:Yeah. And they would essentially, like, go out there. They'd strip off their clothes, and they'd, like, lift, like, tree trunks.
Speaker 1:Okay. And
Speaker 3:they'd swim in the and they'd swim in the
Speaker 1:Lake or something?
Speaker 3:In the lake. And they would just essentially, just work out all day. And I was like, this guy's extremely straight.
Speaker 2:Worked out all day.
Speaker 1:Who's the who's the hardest working founder purely by hours work hours spent working on a single company that you've ever studied?
Speaker 3:Elon, probably. Because if the the how Elon thanks for reading and covering that episode last
Speaker 1:week. So good. You
Speaker 3:guys did a good job on it. It was awesome. So they they actually had a a really interesting conversation recently with somebody everybody knows who's been a founder for multiple decades, and I and he he came up in the technology industry. He's been there forever.
Speaker 1:Sure.
Speaker 3:And I actually asked him that question. I was just like, who's the greatest, like, entrepreneur you ever dealt with or, like, you knew about? And he's like, listen. You might not like him. You might not like working with him, but it was undoubtedly, without hesitation, a young Bill Gates.
Speaker 1:Young Bill
Speaker 3:That would be my other answer if it wasn't Elon.
Speaker 1:Yeah.
Speaker 3:It shifts from the time they started Microsoft in that little strip that little strip mall in Albuquerque, New Mexico. Yep. The guy until he left the company, like, I don't think he did a single other thing.
Speaker 1:Do you think that Bill Gates' hardcore founder mode era was defined by his ruthlessness with regard to deal making or actually the amount of hours he spent in the office? Like, have you heard stories about early Microsoft being this nine nine six culture working twelve, thirteen, fourteen hours a day, or was it strictly that when he went into every single negotiation, he was willing to do anything to win?
Speaker 3:So, like, he's not working twelve hours a day. What's he gonna do? So I'll give you a preview. Okay? The next episode Yeah.
Speaker 3:I'm working on right now is about a young Bill Gates. Yeah. He's gonna the title has to be something with hardcore because he can't say it word.
Speaker 1:Yeah.
Speaker 3:So he would work thirty six hours straight until he couldn't literally stay awake, and then he'd just crash and sleep in his office for, like, a few hours and pop back
Speaker 2:up. That's hardcore. That's I don't wanna hear about, oh, I slept. I got a good night sleep. I'm I'm I'm a grinder, but I got a great night sleep last night.
Speaker 3:Yeah. And so, like, let me wait. You're a
Speaker 2:Oh oh, you're a grinder? Let me see your sleep score.
Speaker 1:Better be in the single digits.
Speaker 2:Better be in the single digits.
Speaker 3:But let me tell you one of the funniest stories about Bill Gates. So the best book written about him is it's called hard drive, Bill Gates in the making of Microsoft empire. So the same guys that wrote that, essentially, it's a it's a biography the first thirty five years was like. Then they it it was so successful. They wrote a follow-up.
Speaker 3:The follow-up book is not good, But there is a story in the follow-up book that is one of my favorite Bill Gates stories of all time. And the the thing I the thing I would say about Bill Gates is, like, he has a ruthless competitive drive that would terrify people. And so one of his main competitors is this French guy. I can't remember his name. They would, like you know, they were going to war over and over again.
Speaker 3:And they would go they've the only time they do, like, interacted, find themselves at the same, like, computer conferences.
Speaker 1:Mhmm.
Speaker 3:And so he he sees Bill Gates sitting on a folding chair in the corner of this computer conference alone looking at something. And remember, this they're, like, head to head to head competitors. You know? Now this guy's clearly disappeared. And so he goes over, and he wants to say hi to Bill.
Speaker 3:And then he walks up to him, he realizes that Bill's in the corner by himself staring at a picture of the guy Mhmm.
Speaker 1:Of his competitor. Of his competitor. He's just a disaster. Like a picture of you and Yeah. Yeah.
Speaker 1:Yeah. Next time I see you, I'm gonna make, you know, my profile picture when I call you, your phone's background. Just remind you remind you of me constantly.
Speaker 3:If you hard drive, the way I described him in the first episode I made about him on episode, like, a long time ago, is that Bill Gates is, Genghis Khan in a mister Rogers costume.
Speaker 1:Yeah. That's wild.
Speaker 3:Think about it.
Speaker 2:There's a few ways
Speaker 1:to read that. That is, yeah. Yeah. That's hardcore. That is that that is hardcore.
Speaker 1:Yeah. Well, thank you so much for giving us more context on what it means to hardcore, be hardcore, and grind in an entrepreneurship context. Hope you have a fantastic rest of your day.
Speaker 3:Doing something. Thanks for calling me, and I'm just gonna say publicly what I said to you guys yesterday after seeing what you did in your I'm super proud of you guys.
Speaker 1:Thank you.
Speaker 3:You're absolutely crushing it. I just don't I don't think you'd have any kind of money involved. I'm very curious where you take this for next two years.
Speaker 1:Thank you. Alright, brother. We'll catch up soon. See you. Bye.
Speaker 1:And Always good. Back. Guest even when you thought we weren't gonna have a guest.
Speaker 2:They said we couldn't do it.
Speaker 1:They said it was possible. Possible when you just got two random mics in the conference room that you could have a guest on your show, but you can. Anyway, honestly, congrats to everyone who got mentioned in this article. I think there'll be some snarky takes. I think there'll be some supportive takes.
Speaker 1:Overall, it seems pretty high leverage to, throw up a flag that says, hey. I'm working hard on my startup. Get mentioned in the Wall Street Journal. They probably had to take, what, half an hour off to do a little phone call for this, and overall, probably pretty high leverage effort. So, congrats to all the all the young grinders in San Francisco working eighty hour weeks.
Speaker 1:Good luck to you all, and and congrats on your first Wall Street Journal mention.
Speaker 2:I've had many, hopefully.
Speaker 1:And if you wanna help grow your startup, get on Adio, customer relationship magic. Adio is the AI native CRM that builds scales and grows your company to the next level. You can
Speaker 2:get started for free. Did you see that Polymarket is getting offers set up to 10,000,000,000?
Speaker 1:Woah. Polymarket is, of course, a sponsor. What is volume just going through the roof? Isn't aren't most of Polymarket's metrics kinda public because you can just look at the chain? Right?
Speaker 2:Yeah. Check Is that
Speaker 1:driving growth?
Speaker 2:Pain. That is I mean, that's
Speaker 1:You know, they
Speaker 2:they they're about
Speaker 1:to be moment.
Speaker 2:They're about to be, you know, launching their app in The US. Yep. Everything to date has been international.
Speaker 1:That is a big catalyst. Yeah.
Speaker 2:So a lot going on.
Speaker 1:They're they're obviously duking it out with Kelsey, but it's great to see Shane on an absolute run
Speaker 2:and Yeah. Whole team.
Speaker 1:Put more put more put more cash in the coffers, more opportunity to to build and and scale the business. It's been a fantastic data source for us. Of course, Polymarket powers the ticker that you see on the show all three hours long every day, and it's been a it's been a source of, of insight for us through our entire partnership. So thank you to Polymarket for sponsoring us. Yep.
Speaker 1:Rehat has a funny, screenshot. Says design is not just what it and then you can't really see it
Speaker 2:because Is this a this is no way
Speaker 1:this is real has to be fake. I think he's, memeing some liquid glass nonsense and some poor design, mixing up the design. But he got six k likes potentially with the fake news. I don't know. If this
Speaker 2:is real There's no way they There's
Speaker 1:no way this is real. Right? Anyway, we'll leave it. It's good. It's a good joke.
Speaker 1:You were to figure out.
Speaker 2:It's a good joke.
Speaker 1:Anyway, in other good news, Kaz over at Shopify, now open door, is replying to random posts on Twitter, saying, email me. I'm still at Shopify until tomorrow. Here's my email. And and Fod says, bro, this guy
Speaker 2:Absolute dog.
Speaker 1:Grinding to the last minute. Love this level of dedication. You know, Opendoor is all over the place. The stock's way up. It's become this meme stock that is is fascinating because, I was talking to Brandon about this with, he was saying, like, there's something interesting about the open door story that is this, like, retail army driving a meme stock.
Speaker 1:The valuation is basically I mean, Keith was actually steel manning it saying that, as a as a revenue multiple, it's not that crazy. It's in the same territory as some other big public companies. I think he cited Robinhood at 31 x revenue or something like that. And so Wait.
Speaker 2:What company?
Speaker 1:So so Opendoor. He was saying that, like, Opendoor is not disconnected from the financials if you if you if we can deliver on the growth and we can deliver on a revitalization plan. Right? That was the that that that was his pitch. And and so and so
Speaker 2:But but he won't he wanted to fix it on the revenue multiple?
Speaker 1:I think it was the revenue multiple. Okay. You you can go and look at his reply. But, basically, I I I I don't think anyone anyone disputes the fact that Opendoor is trading very differently than it was trading last year. Last year, it was trading like a company that was in manager mode with a new CEO and and had gotten kinda hit in this post ZERP era and had not done particularly well across a couple quarters and was I mean, the stock was you know, Jim Kramer would probably say the stock's in the dumps, but the stock is no longer in the dumps.
Speaker 1:It's been on an absolute tear. People have been making fortunes off of it. And the question is, you know, what do they have to deliver? Will they clearly have to go you know, they have to kick it into a completely different gear? And it's just exciting to see Kaz take the CEO role and be cut from a very different cloth.
Speaker 1:Like, I've interacted with Kaz. He's been, I've actually emailed him at this email, and he solved a problem for me on Shopify in, like, two seconds. He almost he basically saved my business. So I I mean, he is he's a remarkable operator.
Speaker 2:Very aligned aligned comp structure as well.
Speaker 1:Totally. He's really only gonna be
Speaker 2:he'll only make money
Speaker 1:If the market cap
Speaker 2:at, like, a dollar.
Speaker 1:Yep. Exactly. And so people will debate the valuation. It's clearly trading of of on the back of a completely different narrative with a completely set of investors that are setting the valuation. It's now valued it was it was valued very low.
Speaker 1:Now it's valued very richly, But it's it is interesting to see, some real legit folks in Silicon Valley step in and say, hey. We're gonna do the turnaround thing. You don't often see this. Most time when most times when a VC incubates or backs a company, and it gets out into the public markets, and they're able to distribute the shares, and they're able to sell their position down. If that company does not do well over the long term, they are looking for the next startup to go in and take a second run at that business.
Speaker 1:Right? So if I I I'm I'm I'm not gonna be able to think of a perfect example, but, I mean, even just think about, like like, the story of Square. Like, Square was as well. Right? He was in that.
Speaker 1:It's like he wasn't saying, like, okay. I sold PayPal. I need to get back into PayPal to do more fintech stuff. He was like, no. Like, I'm fine to do another startup.
Speaker 1:And there's and there's a variety of of stories where someone's someone's taken a company, taken it to acquisition, or taken it all the way to going public. And then the VCs and some of the entrepreneurs and some of the early employees say, hey. We still really like this. We like this industry. I mean, maybe the best example is is ramp in Paribus.
Speaker 1:Like, Eric Lyman and Karimatia took a run at at, you know, understanding, like, the financial credit, you know, how people spend money, saving people's time and money Yeah. On the consumer side with Paribus, sold the company, and we're like, there's more opportunity here. Let's keep going. And so I feel like that's the default playbook in Silicon Valley is that once once you've bet on an industry you bet on a a category, and you've backed the the right founders, you've gotten your return, You've returned capital to your LPs either through an IPO or an m and a process. You're not saying, let's go back into that same structure.
Speaker 1:Yeah. You're saying, let's start again. Let's start a new company. But this is this is an interesting twist in that is that you could imagine Kaz saying, hey. I've been at Shopify for a while.
Speaker 1:I wanna start a a real estate technology company. Yep. And so Keith is gonna write me a check. Khozla's leading the series a. I got a couple people that I've worked with before.
Speaker 1:No. He's coming into Opendoor. He's actually turning around. So it's a little bit it's a little bit different. Although the the GameStop story was somewhat similar because the the CEO of GameStop had founded Chewy, I believe, and was a very successful entrepreneur.
Speaker 1:And it was a similar example of, like, someone there was still a lot of questions about GameStop. Like, can they turn that company around? But the stock performance was obviously crazy. But it was not a, it was not a purely financial person stepping into the role. It was an experienced, CEO who'd built a real company to like, at real scale.
Speaker 1:Yep. Anyway, I don't know if you have a I don't know if you have more of a take on Opendoor or Shopify or anything like that, But I've been
Speaker 2:Yeah. I'm excited to see what Cas does.
Speaker 1:It in. It'll be interesting. How did you sleep last night? Did you get to catch up? We need the soundboard because I would.
Speaker 1:I got a 92.
Speaker 2:How did you pull that off?
Speaker 1:I got a
Speaker 2:92. Guess that's closer to
Speaker 1:the airport. I got to bed really early. I How's your how's your sleep experience? I mean, using an Eight Sleep, by the way, 8sleep.com. Five year warranty, thirty day risk profile free returns for I got
Speaker 2:only six hours and twenty seven minutes.
Speaker 1:I'll leave a five star review for Eight Sleep, the app. I love the app. It is fantastic.
Speaker 2:I am
Speaker 1:currently Potentially, you're you're going into a big I'm currently ill. Yep. I I have the This HRV of
Speaker 2:a of a dead person.
Speaker 1:It's terrible. Well, lock in this weekend, get some sleep. We will be, fortunately home later this evening. This is fun. IPhone air bend test on Tom's guide.
Speaker 1:Icon says an Apple exec casually throwing their product across the room and not flinching at all when the host misses and it clanks off of the wooden table is insane. Apple is extremely confident in the
Speaker 2:joy I of looked this one up. I I I looked this one up because I was like, again, it's like a parody account. It looks like Yeah. It looks like it's fake video, but it's a real real
Speaker 1:No. It's real. They're confident. They've I mean, the do you remember Bendgate? Do you remember this with the iPhone?
Speaker 1:I think it was the iPhone six. No. They went it was the thinnest iPhone ever, and it got truly thin, like, well, way thinner than this back then. They went they were thin maxing. So they they they're with minning.
Speaker 1:I don't know. Is that the right way? They went super thin, and the problem was that if you applied a little bit of pressure, you could actually bend it and break it, like, pretty easily. Like, you could do this, and it would bend. It's titanium.
Speaker 1:And no. It's titanium. It's thicker. There's more structural support inside. But the question with the iPhone Air was obviously like, hey.
Speaker 1:You're back to being super thin. Is this thing gonna bend? And they just toss it across the the conference room, and, the and the host tries to bend it, he's unsuccessful. And I think they figured it out. Anyway, they probably designed it in a Avengers themed office.
Speaker 1:Did you see this article in the Wall Street Journal's mansion section today? Of course, I did. $4,400,000 renovation helped one Winnipeg couple turn their 12,000 square foot home into a into an experience and a story. The Wall Street Journal says, an Avengers office and a Frank Sinatra garage, they built their own Disneyland. I love this.
Speaker 1:I love when people go crazy with the the renos and make the homes their own. Some Disney fanatics get their fix by visiting theme parks. A tech entrepreneur, Jeff Fetz, and his husband, Chris Fetz, wanted to live in their own magic kingdom. The setting for their dream home, a 12,000 square foot traditional style home built in 2009 in the tuxedo area of Winnipeg. We gotta What is that?
Speaker 2:We gotta ask you. I'm gonna scare me right now. What's the tuxedo
Speaker 1:area of Winnipeg. And so here he is standing next to what looks like a very fancy luxury car with the biggest Cartier Santos on his wrist, I believe. He is an absolutely beast of a watch. If you want a Cartier Santos, head over to getbezel.com. Your brother with concierge is available now to source you any watch on the planet.
Speaker 1:Seriously, any watch.
Speaker 2:Such a good transition.
Speaker 1:They, they brought the they bought the brick stucco and limestone house for around 4,000,000 in 2029. Then they spend 4,400,000.0 in a three year renovation
Speaker 2:Double.
Speaker 1:To actually, to actually upgrade the house. We wanted to elevate the design to the level of fantasy. Chris, who was a full time cast member, dancer, and parade performer at Walt Disney World Resort. Is he just is this, like, extremely lucrative? Crazy.
Speaker 1:No. No. No. No. So so the so the, his husband so, there's Chris, and then there's also, Jeff.
Speaker 1:And Jeff has a has a start up, as a business that does, actually customer service and, and has become very successful from that. He cofounded a customer service tech startup now called InTouch CX. After, seven years, they moved to Winnipeg to be closer to the family. They met in in 1997, so they've been together almost, what, twenty years. They're both students at the University of South Florida, and, yeah, they figured it out.
Speaker 1:They have some crazy, crazy stuff going on here. Let's read about the This shot of the the cars
Speaker 2:in this entryway. The cars
Speaker 1:on the inside. I mean, this art deco stuff is wild. We wanted each room to be experiential, who grew up going to Disneyland and would regularly grow go to Christmas shows when they were first dating. The Garage Mahal, as they as the couple have dubbed it, is a garage that was renovated to as a shrine to Frank Frank Sinatra. Wow.
Speaker 1:It houses a peacock blue Rolls Royce Silver Shadow sedan that's that Sinatra bought as a wedding present to his wife, Barbara, which Chris won in an auction. The jazzy room with lacquered wood paneling, oversized backlit frame photos of Frank and Barbara, and a curved blue sofa is where Chris hangs out listening only to Sinatra records and drinking cocktails with a friends. It's way sexier than a man cave. It's crazy. Jeff's downstairs office is nicknamed Avengers headquarters, and the windowless room has the feel of a spaceship.
Speaker 1:To enter, you touch a panel, and a pocket door swooshes open like in Star Trek. There's a long metal mission control station aka desk. The walled the walls are clad with stainless steel and covered with television monitors and Avengers logos, and there's room to store much of Jeff's 40,000 comic books. On display is a full size Iron Man costume. It makes me feel very in touch with my childhood.
Speaker 1:They call one of the bathrooms the spa, and, the story goes on. You can read it in the journal. But what a wild house. You love when, when someone makes it big and just just blows it all.
Speaker 2:Know. Texted Jeremy.
Speaker 1:What Jeremy say?
Speaker 2:That, studying for their dream, a 12,000 square foot traditional style home built in 2009 in the tuxedo area of Winnipeg. I said tuxedo area, question mark? He said enforced by law, actually.
Speaker 1:Enforced by law.
Speaker 2:Do not go to the tuxedo area of Winnipeg without wearing a tuxedo. You will be you will be Do not. Taken into custody.
Speaker 1:Anyway, let's move back to the timeline. Nadir Khalil says, friendly reminder that multiplying revenue by 12 is not ARR.
Speaker 2:Says a lot that this goes viral in in the year 2025. For sure. Two point
Speaker 1:two
Speaker 2:over 2,000 likes.
Speaker 1:Yeah. You got What about
Speaker 2:Harry's asking the important questions. What about multiplying daily revenue by 365? No. Hey. If you've got lumpy revenue
Speaker 1:that you processed your biggest invoice and then multiply that
Speaker 2:by the number of hours in a year.
Speaker 1:Multiply by 24, then you have your hourly Actually,
Speaker 2:take it a step further to to find the exact minute that you got the largest payment ever
Speaker 1:Yes. Check
Speaker 2:it that by 60 and then by 24 and then by 365. And that is right math to do. And that is the way to think about The minute.
Speaker 1:We just had our biggest minute ever. Ever. Like like, people talk about their quarterly earnings. We just had
Speaker 2:our biggest minute ever.
Speaker 1:It put us on a $20,000,000,000,000
Speaker 2:Here's the proof. Here's the Stripe dashboard. Here's the Here's exactly what here's the exact minute the the payment hit.
Speaker 1:If you want to bet on some companies that are subject to GAAP regulations and need to actually deliver
Speaker 2:Real ARR.
Speaker 1:In quarterly reports that are SEC regulated. Head over to public.com, investing for those that take it seriously, multi asset investing, industry leading yields. They're trusted by millions, folks. Public.com. Also, Emily Sundberg, breaking news.
Speaker 1:She has commissioned Donald Boat's work. Do you want to know
Speaker 2:This is a This is crossover I was not expecting.
Speaker 1:Do you wanna know the very first sensation I felt while attempting to eat this? Spasm. My jaw cramped, an inward violent shaking. I cried out in pain. Burgers shouldn't be this tall.
Speaker 1:That was instant divine comeuppance. I was punished from above for even trying to place in my mouth, says Donald Boat. So I'm interested to see what Donald Boat does. Obviously, he's a very creative mind, very schizo. He he's mastered like, he's we have this, you know, schizo red string diagram behind us, but Donald Boat takes us to a to a completely different level with his collages, which I have, I've enjoyed.
Speaker 1:He's he's done, some fantastic posting. Morning Brew has a story. Yesterday, Larry Ellison's fortune grew by $100,000,000,000. And today, Larry Ellison's son, his media conglomerate, is getting ready to buy Warner Brothers, normal family things. These two, father this father son duo is is, on a generational run.
Speaker 1:You'd love to see it. He is, running around, acquiring companies, becoming a media mogul. Pretty fun.
Speaker 2:Crazy.
Speaker 1:I actually have not dug into what's going on with Warner Brothers, what's going on with this discovery. I know that there's, like, the merger and the free process involved somehow. I'm hoping we can get Barry Weiss on the show at some point to kind of break it all down for us because I
Speaker 2:Warner Bros is up new. Up 53%
Speaker 1:Pretty new
Speaker 2:to the past five days. Yeah.
Speaker 1:I do think it's interesting that, at least in the, at least in the .com boom, like, the primary investment bank desk that would watch tech companies would also watch telecom companies and also media companies. Tech media telecom. Like, if you went to Yeah. Goldman Sachs and you wanted to analyze what we think of as, like, pure technology companies, you
Speaker 2:would be TMT.
Speaker 1:TMT, tech me tech media and technology. Yeah. And it's because they all have the same they all have very similar zero marginal cost business models. Yeah. So if you create if you create Mickey Mouse or you own a telephone line or you have a website and you're selling SaaS, those are all financially modeled somewhat similarly.
Speaker 1:And so it made sense to put them all under the same coverage group. Of course, now, like, there's a dedicated desk just for semiconductors and just for, you know, social apps and just just for SaaS and just for enterprise.
Speaker 2:Yeah. Anyway Imagine imagine being able to run around buying companies knowing that you have the full backing of your father, but you're buying company. I mean, Warner Bros. Is worth 46,000,000,000. They're they're That's a lot more than I would have asked.
Speaker 2:Wow. Is preparing a majority cash bid, meaning that, like, they're gonna spend at least put up at least
Speaker 1:Ellison's into debt. I feel like he's not afraid to lever up.
Speaker 2:He's not afraid.
Speaker 1:Maybe that'll happen at some point. But, yeah, put the cash together, get the get the company. I I don't know. It'd be cool. I I feel like I feel like I've I've never met Larry Ellison's son, but I feel like I would trust him to make the next Superman and Batman film.
Speaker 1:And Warner Brothers owns the DC universe, I believe. And I feel like he would have good instincts. I'm also excited about the Jeff Bezos James Bond. I feel like it's gonna be good. I don't know.
Speaker 1:I know you know nothing about movies.
Speaker 2:Why But, who who's the who's the who's gonna be mister Bond?
Speaker 1:I have no idea. But I just, I I I think a lot of people, a lot of the true James Bond fans are are worried about this idea that that, now that Amazon owns the rights to James Bond, they're gonna, like, franchise it like they did with Star Wars. So it'll be like a James Bond show and a James Bond kid's show. Like, if you see Star Wars, it used to just be, like, there's three great movies, and there's three prequels. And then Disney was like, let's do three sequels and then two extra movies and then spin off show.
Speaker 1:Like, there's probably six or seven different shows for the Mandalorian and, the Boba Fett and all the different spin offs, and there's kids versions. I think that's kinda fine. Yeah. I think I think Star Wars has been kind of like there yeah. There's, some mediocre stuff in there, but, like, you can just not watch it.
Speaker 1:And overall, there's, like, there's enough to pull off the shelf. So, like, if you wanna watch something with a four year old, you can. If you wanna watch something with an eight year old, you can. You can get into the original the original trilogy still exists there. Like, you can still watch it.
Speaker 1:So, like, I don't know. I I've been I've been happy with that. I would be happy with more James Bond content. Let let Bezos cook on on on Bond, in my opinion.
Speaker 2:The, it's so funny people being like, oh, they're gonna spend 200,000,000 on the free press. Meanwhile, there it's, like, such a rounding error. We talk about, like, this totality of of deals that they're looking at doing. Yeah. They're looking at buying a a a $50,000,000,000
Speaker 1:He's a public company very wise he's a viable majority
Speaker 2:cash. Yeah. And you want to turn around these assets and and improve them. Yep. And you need great talent.
Speaker 2:And if you need Yeah. If you gotta spend a couple 100,000,000 to get somebody to to, you know
Speaker 1:I think I I I I I think it makes a ton of sense. If you're just thinking about it through, like, this Mark Zuckerberg mindset of, like, who do I want around the table right now? I want a bunch of great people who are entrepreneurial, who are, you know, super connected live players who really care about this stuff. Yeah. You gotta go spend some money to get them, but, it's gonna work out.
Speaker 1:Anyway, apparently, there's a company called Math Inc, and we'll
Speaker 2:They really think they actually got Math Do you think they actually got MathInc?
Speaker 1:I don't know.
Speaker 2:Maybe? Like, because these aren't Mathematics Inc. There's there's there's a certain flex to getting I mean, can get Christian
Speaker 1:Christian says, excited to share that I'm starting a new company dedicated to the creation of verified super intelligence via auto formalization. So is this a competitor to, is this a competitor to Vlad's thing? Building on the amazing RL infrastructure that we developed at Morph Labs, Mathematics Inc. Has already achieved a breakthrough result. And their hiring page says, we call a date a square if all its components, day, month, year are perfect squares.
Speaker 1:I was born in the last millennium, and my next birthday will be the last square date in my life. So there's a very hard math problem here, you just have to in order to apply for their jobs, you have to solve a math problem. Sure. I don't know. You want a job and you're good?
Speaker 1:Also, I feel like this is this is an odd question because I feel like if you copy this and you and you ask it, like, of a frontier model, like, it's
Speaker 2:That's the whole I imagine that's the whole point. I doubt it. I I do you think it can
Speaker 1:We should try to
Speaker 2:If well, if it would
Speaker 1:pretty I mean, I I I have yet to see, like, a, like, a hard math problem out there that that hasn't been pretty easily one shot by, most of the, like, the like, this type of, like, concise question, is typically handled by a frontier model with reasoning. Maybe not, but we'll see. More importantly, video game entrepreneur has just paid through $31,500,000 for an oceanfront Hamptons home. You got Hamptons up on the board connected to Potech. The deal might marks the latest in a string of luxury transactions of the busy East End market.
Speaker 1:So, Karch, this is Matthew Karch. It's a circa nineteen seventies home in East Ham Hampton. He's the cofounder of Sabre Interactive, a video game developer and publisher. And I dug into them, and they do a lot of porting and platforming. So a game will be put out by one publisher, and they'll and they and they'll say, like, we would love to get this Xbox game on Nintendo Switch.
Speaker 1:And, Matthew Cartsch will pick up the phone and say, my team would love to do that. We will do the hard work of making sure your game works on the Nintendo hardware or over here. And and they do a lot of other stuff. But he has some he has some great video games in the portfolio, and, obviously, it's, it's provided for a wonderful life. And he is now in the position where he can, buy a $31,000,000 home.
Speaker 1:He's also I believe he sold the company, and the company changed hands again. So it's unclear Happens. Exactly who, who who owns what, but, it's a cool story. And now he has a wonderful, stunning house. The house literally sits on top of the ocean.
Speaker 1:The property is so amazing that I wanted to buy it and figure out the details later, he said. So he's talking to the journal. He'd love to see it. If the if the journal called you about your home, you gotta pick up the phone. The seller, an entity linked to Norman and Helene Stark, bought the estate for $4,700,000 in 1994.
Speaker 1:The property first hit the market in 2017 for 75,000,000. Wow. That's high. It'd been off the market for years. The most recent asking price was 39,000,000.
Speaker 1:Property contains five bedrooms, roughly 7,000 square feet main house as well as a guest house, tennis court, and pool. The Hamptons real estate market, like those in many vacation destinations, soared during the pandemic, but the number of Hamptons sales hit a fourteen year low in 2024 amid tight inventory and rising mortgage rates. And there's an interesting dynamic where renting a house in the Hamptons is, like, a massive multiple of what it costs to buy, pay the mortgage on a house because people really only wanna be there in the summer. They don't necessarily wanna buy or live there. So there's the kind of an odd disconnect between the rental and purchase market where where you might not see that in that way.
Speaker 2:At the same time, I don't I don't think it necessarily mass out to buy a Hampton's house right now and just rent it in the summer Totally. Just given given where rates are.
Speaker 1:Yeah. Makes sense. In the 2025, there 26 home sales in the Hamptons at or over $10,000,000 compared with 22 in the 2024 and six in the 2023. 2023 was really slow. Karc also owns two properties nearby Sag Harbor that he uses for vacations.
Speaker 1:He's considering selling one of them anyway.
Speaker 2:Another Keep a couple homes nearby.
Speaker 1:Deal. There's a series a financing for a new company that just came out of Stealth, Brain Company. We saw a math company. Now there's Brain Company. Brain Company emerged New Meta.
Speaker 1:Today. We're getting somewhere. We're seeing a trend. I like it. Brain Company emerged from Stealth today, we are announcing our $30,000,000 series a led by Elad Gil and Jared Kushner's Affinity Partners.
Speaker 1:Brain Company provides an AI platform and applications for the world's largest and most important
Speaker 2:We were getting this company? What? Did we
Speaker 1:Yeah. We we were connected. I I I believe we'll hopefully have a founder on soon. Lot of Gil's also coming on the show soon, we can talk to him about this. So go check it out if you're looking to get in early, go work there potentially.
Speaker 2:Meanwhile, the ProFound team Yeah. Is using out of home advertising to try to find an office in Union Square, driving around a, driving around a an advertising truck. Box truck. A box truck, trying to find their
Speaker 1:I think they scale this campaign. They should get on AdQuick. Out of home advertising made easy and measurable. Say goodbye to the headaches of out of home advertising. Only AdQuick combines technology, out of home expertise, and data to enable efficient seamless ad buying across the globe.
Speaker 1:I mean, seriously, they should put some of testimonials or, like, case studies on, like, billboards and airports. Like, that makes a ton of sense. If you're just, like, a general business and you're interested in getting your brand mentioned on Chateappity, just flashing the profound name in front of people, that's pretty high value. Powerful. Anyway, did you see the knockoff Bugatti?
Speaker 2:I did not. This is But this is offensive to my
Speaker 1:This is extremely offensive too. Bugatti's Italian. Wait. Bugatti is an interesting company. Right?
Speaker 1:Because they're like, it's German, but then they have a they a their manufacturing plant is, like, on the border, and it's, like, changed hands a few times or something. But, anyway, most people know the Bugatti, Veyron, Chiron. But It's
Speaker 2:German and then French.
Speaker 1:Is a yeah. That's right. I changed hands. But then
Speaker 2:it was acquired by you
Speaker 1:in Italian. Slash home cleaning robot maker, and it's showcasing the photo of its first car, a Bugatti like luxury battery electric vehicle. So it's a
Speaker 2:Is this a dream? Is this a
Speaker 1:Chinese company? So TR Taxes says a vacuum cleaner robot company founded in '27 Wow.
Speaker 2:They're literally a Dyson knockoff. They're a Dyson knockoff. That's now knocking off.
Speaker 1:Value to $3,000,000,000 is making a luxury EV now. Apple gave up after ten years of trying This is burning $10,000,000,000
Speaker 2:in point. In my culture.
Speaker 1:I know. It's crazy how much it looks like if we
Speaker 2:mean, it wasn't even
Speaker 1:even has a rear diffuser on the back.
Speaker 2:Well well, yeah. So they're knocking off, like, the Veyron, but then also the new one, which I've
Speaker 1:Tourbillon? Yeah. The Tourbillon's the latest one. Although, are are you talking about some of the one offs? Because they've done
Speaker 2:a one off that looks
Speaker 1:They've done, like, convertibles, but there there's only I I believe there's only three major platforms. There's the The
Speaker 2:Solitaire. The Solitaire is they're so they this knockoff is using the front end of the Solitaire. Yep. I mean, basically
Speaker 1:the Veyron.
Speaker 2:Closer to it, just like a Solitaire knock off. Yeah. Really, really dark. Never do this. If you're if you're running Dream Tech Stop.
Speaker 2:Contact your lawyer Don't. And Please. You'll be here. Work with them to wind down the company. Please.
Speaker 2:Just shut it down. Close-up shop. You guys had a good run. You're out of ideas, and just just close it up.
Speaker 1:How do you think this sells? I mean, China's knocked off the Taycan successfully. They've knocked off a few other cars successfully. I wonder what the Yeah.
Speaker 2:I do think it I the the the humor here is that they will probably make a pretty solid car Yep. And it will cost like, they can start selling Bugattis for a couple $100,000, probably. Yes. Can you imagine? No.
Speaker 2:But, like, you could imagine they sell this for, like
Speaker 1:It's probably
Speaker 2:couple $100.
Speaker 1:150 or something, which is why.
Speaker 2:And then if these I could see this making it into America where somebody's like, wait. I can drive make it to America.
Speaker 1:This will get caught the ports for sure.
Speaker 2:You mean you mean, like
Speaker 1:Yeah. IP trade dress. Like, it'll be easy to lock this up. It's not making it to America. But people will be driving around in China.
Speaker 1:I mean, I've I've heard about fully fully counterfeit cars before. Like, in China, they they they they have the ability to set up like, it's a G Wagon factory, and it makes cars that look like G Wagons. And That are bad. Every and badged everything is trying to be as perfect as possible, a true knockoff. And then they've had to work their way through other countries.
Speaker 1:You take it in the dealer, and they're like, we can't work on this engine. This is not a Mercedes engine.
Speaker 2:Well, yeah. The and and the reason that knockoff cars are not as big as knockoff watches is, like, there's no regulatory framework for watches. Right? You're not gonna hurt someone else by driving Yep. Wearing a fake Rolex
Speaker 1:or whatever.
Speaker 2:Yep. Yep. Yep. This was big. This was big.
Speaker 2:Two of the Cluely founding team have broken off. Pretty crazy. I guess they are doing, running the same playbook.
Speaker 1:Yep. Chris says life update left Cluely to start our own thing. Already at 1,200,000.0 ARR, seven days in stealth, had no idea making money was this easy, announcement soon, Instinct Inc. This post is fascinating. Fascinating.
Speaker 1:Because doesn't say what the business is. 1,200,000.0 ARR. What is the subscriptions of some sort?
Speaker 2:It's written to And then to to trigger. Yeah. Had no idea Not falling
Speaker 1:money was this easy. Yes. You did have an idea that making because you were saying clearly. You said making money was easy. I I know how easy money is, but here we are talking about it.
Speaker 1:Anyway They were luck to them.
Speaker 2:Abated us. You baited us. No. But, yeah, wishing them wishing them luck. And I wonder if they will start beefing with their former employer to
Speaker 1:From yeah. From a get From a WWE perspective, that is going to be unmissable content. If they are constantly chirping at each other and fighting and going on podcasts and debating each other and and taking shots and running adversarial billboard ads against each other. Like, there is a world where that generates more views than anything they've done before. That might be the final state of of startup media marketing.
Speaker 1:The real question is, like, what is what what it does this say something about, like, whether or not Cluelie has hit product market fit? We demoed the product. We we we were not very sticky. Tyler, it seemed like he enjoyed the product and thought there were some glimmers of hope, but he just he did not become a good user.
Speaker 2:Audience.
Speaker 1:Well, when we talked to Roy, it was it was wasn't clear who the date who the target audience was. It was maybe the college kid who wanted to cheat on an exam or you wanna cheat on an interview, but then that was probably illegal and risky, so you don't wanna do that. Then there was, like, maybe enterprise sales. Then Roy was talking about brain computer interfaces and VR. And so, like, there there were just, like, a bunch of different ideas, clearly throwing spaghetti against the wall, unclear what was sticking.
Speaker 1:And so I'm I'm interest I am interested to see what Instinct Inc winds up building, and I'm wondering if they, have done more work to make sure that they're building on top of a solid foundation because the big question that was looming around clearly was just, masterful marketing, lots of clearly breaking through the noise, cutting through the noise, getting downloads. But was it a leaky bucket? And so have has this team, now that they're on their own, have they built a less leaky bucket with this? Because what happens if you stop going viral? Does that $1,200,000 in ARR turn into nothing over fourteen days because everyone unsubscribes?
Speaker 1:Who knows? Yeah. Anyway.
Speaker 2:I I I would go out and guess that they're just starting a creative agency, which would probably make a lot of money really fast.
Speaker 1:I think so.
Speaker 2:So That would make a
Speaker 1:lot of sense.
Speaker 2:Anyway 25
Speaker 1:Find your
Speaker 2:happy your happy place.
Speaker 1:Book of wanderings and interviews, hotel grade amenities, dreaming beds, top tier cleaning, and twenty four seven concierge service. It's a vacation home, but better, folks. We will close out with this. Twenty five years ago, there was an article in the newspaper, in the Daily Mail, Tuesday, 12/05/2000. Internet, quote, may just be a passing fad as millions give up on it.
Speaker 1:And, of course, recontextualized, the max of the VC is obviously drawing a a comparison to the AI narrative. I don't know if anyone's gone out and actually said AI is a passing fad. People have kind of said, like, maybe we're over our skis on CapEx, or maybe we're over our skis on on, you know, enterprise value
Speaker 2:Or maybe the promises are $2.
Speaker 1:Yeah. Maybe we're not getting ASI tomorrow. Yeah. 2027. But I I I don't think anyone is out there really saying, yeah, in in ten years, like, we're not gonna be chatting with Elle.
Speaker 2:It's so funny to to try to I mean, it's it's very difficult to to, like, this article is especially funny because Internet may just be a passing fad as millions give up on it. It's like, well, are those millions of people benefiting from other people using the Internet? If so, then, like Yeah.
Speaker 1:It's It's
Speaker 2:Yeah. This is enduring value.
Speaker 1:Crazy. Researchers found that millions were turning their back on the worldwide web, frustrated by its limitations and unwilling to pay high access charges. They say that email, while replacing other forms of communication, is adding to an overload of information. Experts from the Virtual Society Project, which published the result the report say predictions that the Internet would revolutionize the way society works have proved wildly inaccurate. Many teenagers are using the Internet less now than previously, they conclude.
Speaker 1:James Chapman. I would love to know where James Chapman is now. He was a science correspondent at the Daily Mail, and it's interesting. I mean, he it's you can't really say, like, he got this wrong because he's just publishing the facts, which is, like, these researchers found this data point and kinda leaving it up to your interpretation. But
Speaker 2:less Yeah. And that's like all these articles come out, like AI adoption in the enterprise is dropping. Yeah. Or or, what what was the the MIT report? Like, 95% of Gen AI pilots are are I
Speaker 1:mean, that that that meter report was, like, the most bearish take on Cursor possible. Because it was, Cursor is slowing people down. That was, like, the the
Speaker 2:And yet basic reading. And yet demand But
Speaker 1:you dug into it, and there was a lot of different ways that it could actually speed you up in certain in certain context, in certain
Speaker 2:Well, yeah. And then you just
Speaker 1:And then all the products just
Speaker 2:get better. Look at the demand for Exactly. Yeah. Incredible. The apparently, cursor in the secondary market is trading closer to 30,000,000,030.
Speaker 2:Than than 20. That's up
Speaker 1:there, man. That's up there. It's great, though.
Speaker 2:Incredible time to be alive. Incredible time to
Speaker 1:be alive. Well, thank you for tuning in to our remote livestream today. We will see you
Speaker 2:We did it. They said it was impossible. Said was impossible. Wrong. And next week, got some travel in the in the middle of the week, but will be back in the Holterdam on Monday and Tuesday.
Speaker 2:Very excited. And get out there this weekend and touch grass, be with your loved ones, log off.
Speaker 1:Yeah.
Speaker 2:I'm excited to log off.
Speaker 1:To log off.
Speaker 2:I think Charlie would
Speaker 1:Watch him do the same thing.
Speaker 2:Was known for logging off from Friday night to Saturday, and we'll be doing my best to do the same. And
Speaker 1:Thank you so much for tuning in.
Speaker 2:Thanks for tuning in this week.
Speaker 1:We'll see you Monday. Goodbye. Love you.