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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 TVVN. Today is Tuesday, 05/13/2025. We are live from
Speaker 2:the Temple Of Technology, the Fortress Of Finance, the capital of capital. Thank you.
Speaker 1:We are wearing Pit Viper
Speaker 2:Viper today.
Speaker 1:Amazing shirt.
Speaker 2:Chris, the founder and CEO of Pit Viper I I think these are great. These to us. These look
Speaker 1:perfectly on brand for us.
Speaker 2:Yes. They look very on brand.
Speaker 3:They're fantastic.
Speaker 2:And I'm gonna take them off because I can't see very well. Yeah. It is Thank you to Chris for sending them over.
Speaker 1:On the set. Anyway, we got a great show for you guys today. Folks, we're talking Saudi Arabia. Technology has taken over Saudi Arabia. All of our hardest hitters, all of the absolute dogs of Silicon Valley have crossed the Atlantic Ocean and They're bringing technology the Middle East.
Speaker 2:Yes. To Riyadh.
Speaker 1:To Riyadh. So we'll cover that, talk about what's happening, why folks are there. Alex Wang's there. I saw Alex Karp there. Bunch of Alex's in tech there out in Saudi Arabia.
Speaker 1:Jensen Huang and NVIDIA's announcing stuff. Different trade deals going down. Bunch of interesting things happening. Then we're gonna talk about Tesla's Robotaxi timelines, what's going on with their Robotaxi launch. They it seems like they faced some setback setback.
Speaker 1:There's an article in the in the information that, seems to make it all doom and gloom, but I didn't like one of the quotes that I saw in there, so I wanna talk about it.
Speaker 2:Truth zone.
Speaker 1:Truth zone. And there's also some stories about just how big tech is grappling with artificial intelligence generally. There we've been talking about this a lot, the innovator's dilemma, the problems of trying to build a product when you're a massive tech company. Even though you have all the resources possible, you're still struggling to get something to This
Speaker 2:is why Zuck started doing jujitsu
Speaker 1:at some point
Speaker 2:last year. Yeah. So he
Speaker 4:could really
Speaker 1:They're they're one of the companies that's doing okay, but, you know, the rest are struggling, I think. But we'll dig into it. The art market,
Speaker 5:we say it's absolutely ripping. There was a
Speaker 1:big sale. Wasn't quite where people want it, but we'll break it down for you because we know that you need an update on what's happening in the art market. And then we are gonna hopefully talk to somebody who's out in Saudi Arabia. It's gonna be, like, midnight or 10PM their time, but, hopefully, we'll be able to get on a call with somebody in Saudi Arabia breaking down what's exactly happening with all the technology folks who are out there in Saudi Arabia. And then we got a great lineup of founders, investors, and analysts to take us through the stories of the day.
Speaker 1:So let's kick it off. First off, Trump has lift lifted sanctions on Syria and touts deals in his Middle East tour. This is from Riyadh. President Trump has decided to lift sanctions on Syria, giving the country a financial lifeline after a lightning campaign overthrew its decades long dictator last late last year. I will be ordering the cessation of sanctions against Syria, Trump said during a foreign policy address in Riyadh.
Speaker 1:His first stop on a four day swing through The Gulf. I wonder where else he's going. We'll have to figure that out. Track him. Cutter.
Speaker 1:You know? Yeah. Right? Probably.
Speaker 2:That. I'd be surprised.
Speaker 1:Mean, I'm assuming they wanna give
Speaker 2:him
Speaker 1:He
Speaker 2:has to pick up a plane. Yeah. He's gotta go.
Speaker 6:Because they
Speaker 1:can't just fly again. Check it out. These things don't fly themselves.
Speaker 2:Yeah. And and even though it's a gift, it's such a meaningful gift. It's such you know, he wants to make sure he wants to you know, he's not gonna take the gift sight unseen.
Speaker 1:Right? Trump is going to break the bottle of champagne over that new plane.
Speaker 5:Yes.
Speaker 1:That's he's not gonna let he's not gonna delegate that. He's not gonna
Speaker 2:let yeah.
Speaker 1:No way.
Speaker 2:There are things you delegate, there are things you do not delegate. Yes.
Speaker 1:He's in founder mode on that one. He's not in manager mode. That's Now it's time now it's their time to shine. We're all we're taking them all off. The announcement sets the table for Trump to speak with the new Syrian president Ahmed Al Sharra on Wednesday in the Saudi capital, which the White House has billed as a quick meet and greet.
Speaker 1:The the, like, the the the structuring of these deals, like, oh, I asked him to call me, and I he didn't call me. I don't think
Speaker 2:it's not a meeting. Requested that you request a meeting with us.
Speaker 1:Exact yeah. That's the that's the key too. Yeah. Maybe maybe we should port some of that back to to venture capital. Yeah.
Speaker 1:If you're pitching a VC, request that they request a meeting with you. If you're a founder, you're going out raising your series b. Hey, Andreessen, I would request that you request a meeting with me.
Speaker 2:I would request that you reach out to me cold
Speaker 1:Yeah. Yeah. Exactly.
Speaker 2:With a preemptive term sheet. I would request that you preempt my round. Yes. Yes.
Speaker 7:Yes. I I I
Speaker 2:I always think it's good that the way that founders will message rounds. Yeah. It's like that they'll be raising for two months and then they'll be like, yeah, were preempted.
Speaker 1:Exactly. Exactly.
Speaker 2:Yes. Buddy, you've been raising for for months weeks. Weeks now. Like, you've been taking meetings with investors, getting a term sheet is not The
Speaker 1:preempting branding?
Speaker 2:I mean, I I know a friend of ours
Speaker 1:who who said that to me at one point
Speaker 2:Also preempting on a pre seed is hilarious
Speaker 8:too because it's
Speaker 1:like It's like, what are you pre empting?
Speaker 2:You were gonna bootstrap?
Speaker 1:Oh, yeah. Definitely weren't ready for pre seed. Yeah. Weren't ready for pre seed.
Speaker 2:We weren't ready. Yeah.
Speaker 1:They just totally jumping ahead on the value.
Speaker 2:Yeah. We were really going for more of a friends and family. But, you know, once somebody you know, once this pre seed fund
Speaker 1:Yeah.
Speaker 2:Yeah. Offered a hundred k, well
Speaker 1:Yeah.
Speaker 2:We felt, yeah, maybe we're okay with getting pre
Speaker 1:empted. You know, it's become such a meme to use the preempting thing. I feel like the next stage is putting in the press release. I mean, like, announced instead of you know, we we announced a seed, seed plus, a, b, all of these rounds have kind of shifted around. So an a is now the size of a b or whatever.
Speaker 1:You should just announce, hey. We're announcing a preempted series a. And just put that on the newswire.
Speaker 2:Yeah. Or companies should just announce that they're in advanced talks. That works too. Like, just say, like, yeah, we're
Speaker 1:Call the press.
Speaker 2:Mean, that's basically that's basically what company it seems like if if sometimes a fundraise will leak, and it's like, okay, this company is in advanced talks. Other times, you can tell it's the company itself. Yeah. Just like going to the press and being like, we are in advanced talks.
Speaker 1:I love this I love this segment because we were like, let's talk about what Trump's doing in The Middle East in two seconds.
Speaker 2:Back to early stage
Speaker 1:Early stage.
Speaker 2:Technology investing. Because that is because I really don't care that much about the story. I really don't. I'll I'll dive in a little bit. So Yeah.
Speaker 1:Yeah. There's some interesting stuff here. In Trump's remarks
Speaker 2:capped an eventful first day of his Middle East visit.
Speaker 1:This is the 300,000,000,000
Speaker 2:investment deals. Let's see here. Love 300,000,000,000. With Saudi Arabia with an eye toward doubling the total within four years. I believe that the White House was highlighting $600,000,000,000.
Speaker 2:So
Speaker 1:Where does that even go? Is that us investing in them, them investing in us, both ways? One hand washes the other, I I assume.
Speaker 2:Who knows? Why don't why don't you figure that out? I mean, I I I think it's primarily in The US. That's what what Trump cares about. Yeah.
Speaker 2:He heaps praise on the kingdom's crown crown prince, Mohammed bin Salman promising that we will always be friends.
Speaker 1:Yeah. Mean, this is one of those things where like
Speaker 2:He also encouraged Riyadh to move towards normalization with Israel as soon as it's ready Yep. Even though war rages in Gaza and Palestinians are no closer to self rule.
Speaker 1:The fact that you restrained your yourself on the soundboard when we had the secretary of the army on, you know, this is a really it's a it's a safe show.
Speaker 2:He would have loved it. Business leaders. He would have
Speaker 1:loved it. Company CEOs, you know, presidential appointees, really the most important decision makers in the world come on, and they all get sound effects equally.
Speaker 2:Yep. Yeah. I really need to adopt an an equal opportunity
Speaker 1:Not just with the friends. Hit those, you you it's it's very clear who you're friends with.
Speaker 2:Yeah. Tish yesterday was was
Speaker 1:He was in there.
Speaker 2:You could tell he was just like, it really meant
Speaker 1:a lot
Speaker 6:to Yeah.
Speaker 1:Feeding off the energy. It's great. But I think I I think it's universal. I think everyone loves the soundboard effect. So, yeah, let's try and space it out today.
Speaker 1:Try and hit everyone pretty
Speaker 2:quickly. This article is extremely politically charged.
Speaker 1:Yep.
Speaker 2:I'm gonna read this next Still the main message of the first day is that Trump values the transactional nature of US Gulf relations. As long as money pours into the American economy, The US will remain engaged and close to the region. He just said we will always be friends. Okay. He like, just said
Speaker 9:Yeah.
Speaker 2:Yeah. We're boys. Yeah. MBS, we're boys. Yeah.
Speaker 2:Now this journalist wants to say that it's just about the money? I mean, come on. Come on, give him some, give him some credit. You achieved a modern miracle the Arabian way, Trump said of The Gulf's oil rich monarchies. The Gulf nations have shown this entire region a path towards safe and orderly societies with improving quality of life, flourishing economic growth, expanding personal freedoms, and increasing responsibilities on the world stage.
Speaker 2:Trump's stop in Riyadh was always billed as a glitzy spectacle, but few could have predicted the warmth displayed between the two leaders and the nations they lead. Trump's visit to Riyadh kicked off with a Saudi f fifteen escort as air force one touchdown at King Khalid International Airport on Tuesday. Drums boomed and horns blared as the crown prince Sick. The country's de facto ruler greeted Trump on a lavender colored carpet rolled out beneath the American plane. They really rolled out the lavender carpet for him.
Speaker 1:There it is.
Speaker 2:The lavender carpet. Walked into the airport for a private ceremony lined by waving US and Saudi flags to welcome the president and many of his senior officials, including secretary of state Marco Rubio and defense secretary Pete Hegseth.
Speaker 1:A former Andreessen Horowitz partner, Sri Ramakrishnan.
Speaker 2:Yeah. I hope he got a chance on card.
Speaker 1:Bunch of photos. He's a heavy hitter over there.
Speaker 2:It's amazing. Heavy. Heavy.
Speaker 1:We love it.
Speaker 2:Very cool. And again, you you know, I they they clearly understands Patent tree. They understand that that Trump loves showbiz. Yep. And so the more that you can lean into that Yep.
Speaker 2:The better, you know, the relations you'll have with The US. Yep. So
Speaker 1:Elon Musk is there. FIFA president Gianni Infantino is there. Trump landed in The Middle East transformed by near nearly two years of war, which responded with a devastating military campaign that has killed tens of thousands of people, trying to shut it down, trying to bring peace to the Middle East.
Speaker 2:Yep.
Speaker 1:It's rough. Anyway, we should go to some of the other announcements that relate to this. So unusual whales has opposed that, US and Saudi Arabia agreed to a hundred and $42,000,000,000 in defense sales. You have to imagine that that's important to defense tech one way or another. Although we haven't seen a lot of stories about this, most of the stories that we've seen out of defense tech have been around Ukraine.
Speaker 1:But I was wondering if we're going to see you you know the story of Niros, the drone company? Yep. How a Soren, great name, Monroe Anderson. Nominative determinism. So he went out to Ukraine.
Speaker 1:He's one of the, he's literally the world champion in FPV drone flying. Have you
Speaker 2:seen this? Yes. Drone racing.
Speaker 1:Drone racing. Yeah. So he's incredible pilot. Like, you you go out and you think, oh, he's gonna fly the drone, and it's like the most intense Yeah. Whipping around a tree.
Speaker 1:He's crazy. So he went out to Ukraine and was helping train drone pilots there to use drones as weapons, basically. Comes back, builds a company around it. It's an incredible story. Raises from Sequoia.
Speaker 1:Obviously, lots of com lots of competitive dynamics with Andoril and stuff, so a lot of questions and a lot of problems they need to solve. But, still, like, an incredible story of, like, going and getting experience on the ground as a young technologist and then going and building the exact thing that
Speaker 2:Yep.
Speaker 1:Like, they need, and then eventually selling it to the Ukrainians. But we haven't heard those stories as much from Saudi Arabia or The Middle East. And I was also wondering with the India Pakistan conflict, if there was going to be a Niros type company that grows up out of India. Obviously, there's a lot of, folks from India who work at Andoril or who work in defense tech or or even don't even come to America but want to work in defense tech. Yeah.
Speaker 1:It'd be interesting to see someone who cuts their teeth in the Indian Pakistan conflict then build a company out of that, and that is something I'm, like, tracking right now.
Speaker 2:Didn't have that much time to cut their teeth.
Speaker 1:Well, yeah, because it was very, very short. But still, I I I I like and and America the whole time was like, we're hands off on this. Like, we're not taking sides. But if you look at the actual numbers, America has kind of taken a side in the sense that just in the last year, America has sent $5,000,000,000 worth of military equipment to India and zero to Pakistan. Yeah.
Speaker 1:And so, like, the numbers are pretty clear. And when I see $5,000,000,000, I don't see, okay. Yeah. Like, that's you know, there's a generational company to be built right there for American and to roll for America, for India, whatever. That probably just makes sense.
Speaker 1:But is there is there someone, like an entrepreneur, who could go over there and get one contract done for 10,000,000 and then take those learnings from that unique conflict because I'm sure it's different from other conflicts and then build a real company around that. Was something I was kind of tracking. But and I've heard some folks saying, like, they want to build, like, the Andoril for India, and that'd be interesting to track, but haven't seen that actually happen yet. Anyway, back on Saudi Arabia. Saudi Arabia brought in a mobile McDonald's for president Trump on his visit.
Speaker 1:Incredible. It's just like a portable McDonald's.
Speaker 2:Like, his reputation Wisdom wood wooden siding that looks like not just any old McDonald's. Yeah.
Speaker 1:That looks like top tier McDonald's. Pretty sweet. And then Vittorio kinda summed it up all in one post here. He says, Trump, Elon, Sam Altman, Jensen, and Saudi royalty, this might be one of the most important events of the decade. Trump signs the peace accords, sets up the largest bilateral deal in history.
Speaker 1:Elon brings autonomy, solar grids, orbital access. Sam Altman brings AGI and Stargate infrastructure. Jensen brings silicon and compute. Saudis bring capital, land, and energy. This is how post scarcity begins.
Speaker 1:Compute for carbon swaps and desert solar powering AGI fabs instead of oil rigs and starship landing pads on Arabian sand. Petaflop replaces petrodollar, and Sun replaces oil. This is the birth of a postwestern, post scarcity, post democratic world order. Interesting take, Vittorio. Let's hear it from Vittorio.go.
Speaker 1:Which is the most aggressive take possible out of, like, you know, something that they described as like a meet and greet, and they're, like, taking some photos. But, you know
Speaker 7:I mean, yeah,
Speaker 2:you got it.
Speaker 1:Directionally correct that there's, like Acknowledging anything. The beginning of partnerships and and the continuation of partnerships because, obviously, Saudi Arabia through investments is is is exposure to a lot of these and, you know Yeah. There's been discussions here. It's not like all of these deals are gonna get signed today, but I like that he's putting a point
Speaker 8:on it.
Speaker 2:He's saying we are entering post scarcity today.
Speaker 1:I like some options.
Speaker 2:Even even post democratic.
Speaker 10:Yeah.
Speaker 2:Right? Post democratic. Yeah. Love Vittorio. Thought provoking to say the least.
Speaker 1:There's some
Speaker 2:other We should talk about the specifically the NVIDIA
Speaker 1:Video thing.
Speaker 2:Yeah. Sure. Deal. So I'll I'll pull this up.
Speaker 1:So Humane and NVIDIA announced strategic partnership to build AI factories of the future in Saudi Arabia. We're hearing the
Speaker 2:AI factory term Humane is the AI subsidiary of Saudi Arabia's public
Speaker 1:investment Public investment fund, PIF.
Speaker 2:So they're making a major investment to build AI factories powered by hundreds of thousands of NVIDIA's most advanced GPUs. Over the next five years, NVIDIA will work with Humane to train and empower an AI ready workforce. Mhmm. Sounds awesome. When did Jensen start calling data centers AI factories?
Speaker 2:I don't know.
Speaker 1:And I wonder if that came from him or
Speaker 2:it felt like a month ago.
Speaker 1:But it does seem like a more general term. Like, can understand AI factory. Like, of those factories. Center is very it's like, are you just storing data?
Speaker 4:Yeah.
Speaker 10:Alright.
Speaker 2:Add another 1,000,000,000,000 to the market cap. I've seen enough.
Speaker 1:So the projected capacity, for one of the first factories is 500 megawatts, which is not massive by American standards, but it's up there. And that will have several hundred thousand NVIDIA GPUs over the next five years. The first first phase of deployment will be a 18,000, cluster 18,000 GPU cluster of NVIDIA GB 300 Grace Blackwell AI supercomputer with NVIDIA InfiniBand networking. Man, they really like the jargon in here.
Speaker 2:And NVIDIA popped on the news. They're up another 5% per
Speaker 1:day back into
Speaker 2:the three t club.
Speaker 1:Let's hear it. Let's get some sound board for them. That's fantastic. That's really good.
Speaker 2:Here's a good
Speaker 1:you're talking about. Here's a like, the the path to the biggest company on Polymarket, how how it was a race between Apple and Microsoft. And we were like, yes, that makes sense. But the one company that could just absolutely pop would be NVIDIA if it was a still. Yeah.
Speaker 1:Of course. Of course. But but, like, if NVIDIA does a couple more huge deals out of nowhere, all of a sudden, it's gonna
Speaker 2:be It's
Speaker 8:so funny
Speaker 2:because the gap between NVIDIA and Microsoft is, like $200,000,000,000.
Speaker 1:Oh, that's it? I thought it was like a trillion dollars. I don't even know.
Speaker 2:Where are all the markets? $200,000,000,000, there's just not
Speaker 1:Oh, they could close that in a weekend.
Speaker 2:Yeah. Yeah. That's just like a one swing. Here's a good quote from Jensen. Jensen says, AI like electricity and Internet is essential infrastructure for every nation.
Speaker 2:Together with Humane, we are building the AI infrastructure for the people and companies of Saudi Arabia to realize the bold vision of the kingdom. So, anyways, big news. And the other
Speaker 1:is at 28% to be the largest company by the end of twenty twenty five. It's Microsoft at 37%, Apple at 31%, and then Nvidia at 28%. And the market caps are 3,330,000,000,000 versus 3,170,000,000,000.00. Wow. Yeah.
Speaker 1:Doable. Doable for Jensen. Couple deals, and he makes it happen. Yeah. Interesting.
Speaker 1:I wonder what they'll be training. Mean, they've they've done Falcon 9B. I haven't heard more about their LLM development. Are they okay being a buyer of OpenAI and Anthropic and the other foundation models? Or do they really want to own their own?
Speaker 1:If they're really close with us and they are boys, right? Like you shouldn't care. It shouldn't be
Speaker 2:that big of a deal. You should be like, yeah. It's fine. I don't
Speaker 1:care if I use an American LLM. But we'll see where they go with it. Anyway
Speaker 2:We will see.
Speaker 1:Alex Wang was over there. He said good discussion on AI leadership with president Trump and my colleagues from across the AI industry. Shaking hands emoji. Thank you to our Saudi Hosts as well. Seems like you had a great time.
Speaker 1:And Elon Musk posted a eight minute interview from the Saudi US investment forum, and there were some details that came out of here. I don't know if we can play this video. Do we have audio for this?
Speaker 2:Imagine the tension between Unsushin and Sam. Yeah. Oh, yeah. That's better a US Saudi and a Saudi US relationship that is ninety two years old about how we move from an oil based economy to an innovation based economy powered by wonderful technologies that definitely you're one of the pioneers in this industry. We just showed to his royal highness some of your optimist robots.
Speaker 8:Yeah.
Speaker 2:And to president Trump.
Speaker 8:Yeah.
Speaker 2:Let's talk about that. Tell me about them.
Speaker 3:Yes. So so we just showed the several of our Tesla optimist robots to his highness and president Trump, and I think they were very impressed. In fact, one of our robots did the Trump dance, which I thought was pretty cool.
Speaker 2:At YMCA. Yeah?
Speaker 3:Yeah. To YMCA. So, yeah, our robots can dance. They can walk around. They can interact.
Speaker 3:I think we're we're headed to a radically different world. I think I think a a good world, an interesting world. My prediction actually for humanoid robots is that ultimately, there will be tens of billions. I I think everyone will want to have their personal robot. You can think of it like, as though you had your own personal c three p o or r two d two or but even better.
Speaker 3:Then who wouldn't want to have their own personal c three p o r two d two? That would be pretty great. And I I also think it it unlocks an immense amount of economic potential because when you're you think about what is the output of an economy, it is productivity per capita at times population or capita. The once you have humanoid robots, the actual economic output potential is tremendous. It's it's really unlimited.
Speaker 3:Potentially, we could have an economy 10 times the size of the current global economy where Sorry for that. No one wants for anything. Well
Speaker 1:Well, it's
Speaker 3:good. Sometimes in AI,
Speaker 2:they talk about I'm adding the sound of basic majority is anything is happening. Think it's actually gonna be universal. No one's clapping in the actual audience.
Speaker 1:Yeah. It was kind of low energy. Come on, guys. Where's your soundboard?
Speaker 2:I was falling asleep.
Speaker 1:Saudi US investment forum stepping up, guys. We should stay on we should stay on Elon and talk about the Tesla taxi stuff.
Speaker 2:Should Tesla get credit for those tens of billions of humanoid sales today? Today. Because I don't think that's priced into the stock.
Speaker 1:It's The
Speaker 2:market is not quite pricey. It's priced into figure, right? Yeah. Yeah. $8,000,000,000 you got to think that that figure's priced in.
Speaker 9:For
Speaker 2:sure. But if I'm looking at Tesla
Speaker 1:Look, I mean, you know, you're you're, like, half joking, but there really is
Speaker 2:Oh, Tesla's back over 1,000,000,000,000.
Speaker 6:Let's go.
Speaker 1:That's good. No. I never doubted it for a second.
Speaker 2:We're so bad. It's so crazy. Even so you could buy Tesla at $227 a share a month ago, less than a month ago. It's at 335 today. All it took was giving up the Doge dream.
Speaker 1:Terrible time to be a techno pessimist. It's really awful. Anyway, I I I do think the the the Tesla the Tesla story is interesting because there are two narratives right now that are kind of rivaling. Like, you're joking about, like, are you pricing in all $10,000,000,000,000 worth of GDP or whatever that they're gonna add? But I do think that there are a significant number of investors that are saying, I'm investing because of of Optimus.
Speaker 1:And there are a different set of investors that are thinking, I'm investing because of robotaxis. Because these are the two major transformative technologies that if they work will be big new markets. Right? And Tesla's working on both of them, but there's questions internally about timelines on each of them. Optimus obviously seems farther farther out, potentially bigger market even.
Speaker 1:And then also there's, like, reports of, like, you know, how far along are each of the technologies? How how are the teams actually doing on this stuff? But the thing that I keep coming back to and the thing I wanna dive into is just there's a lot of negativity around Tesla, like missing deadlines or, oh, the the robots are actually teleoperator or whatever. But, I think it's always useful to step back and benchmark against what else is happening in the market because, like, the idea of a robot that dances is not science fiction. Like, we've seen it with Boston Dynamics.
Speaker 1:We've seen it with Unitree. Yep. And it seems like the question is not, can Elon build a robot that dances that's as good as Unitree or as good as Boston Dynamics? Like, that seems like pretty commoditized right now.
Speaker 2:He should
Speaker 1:be able to do that. The question is, can he dominate the category and really scale up production to a point where the economic flywheel works, it's profitable, and the products are so much better that they're winning, winning, winning. Just like in the heyday of Tesla, the Model three was winning like best car of the year by car and driver, like a pretty nonpartisan group that was just like, yeah, on paper for the price. This is an incredible car. It goes zero to 60 in two seconds if it's the Plaiden.
Speaker 1:It's like under a hundred k. You could never get that performance for price ever before, and it drives itself. So so anyway, the big discussions about the Tesla Robotaxi deadline. The information says the deadline is nearing, and it's the start of a key testing phase that is uncertain. And so, in Austin, Texas, there is a deadline that's just weeks away, but the company hasn't started testing its cars without a human safety driver as of last month.
Speaker 1:According to an engineer close to the testing and former employee, that's a crucial step required before Tesla can launch the pilot service for customers. And so Waymo is going through the, the approval process for self driving taxi services, obviously, all over the place. They're in Los Angeles now. They've been very successful in San Francisco. And there's clearly stages and gates to that rollout where there's a human driver in, then you pull the driver out, and the car's driving around by itself at low speeds, then higher speeds.
Speaker 1:And as you get approved, you move forward. And so Tesla's been training its most popular model, the Model y, in Austin since at least last fall according to internal emails. Tesla employees are now testing the robotaxi service cars on supervised rides in which a human safety driver sits behind the wheel. Testing without a safety driver is the next step, although it's unclear when that will when that will start. Much is at stake.
Speaker 1:Musk is betting Tesla's future on robotaxi ambitions, which will initially rely on existing Tesla vehicles before using cybercabs, the specialized vehicles without steering wheels. It plans to begin manufacturing next year. And making the cybercab, that does not seem complicated because it's basically a Model three Yeah. Without a steering wheel. It's like less parts.
Speaker 1:Yeah. And it's all the same infrastructure. So I would be shocked if they don't hit that goal to make that because it's paint it gold and you're good to go, basically. It wasn't like a radical reinvention of what the vehicle is.
Speaker 2:Yeah. Mean, most exciting thing the doors go up. Right?
Speaker 1:Yes. Yeah. The butterfly doors are important. Yeah. Always
Speaker 2:does. Go up.
Speaker 1:Musk is also betting that Tesla can catch up to Alphabet's Waymo, which already operates a commercial robotaxi service in several US cities, but employs a different approach to training and operating cars, which we'll which we'll talk about. So when Waymo wants to offer its city, its service in a new city, it uses data from sensors on a handful of test cars to prepare detailed maps of each city so its vehicles can safely navigate the streets. The process took a decade to develop and can take at least a year to complete. In Austin, Waymo tested for about six months with the safety driver in its vehicles and six months without them. Waymo cars don't yet ferry passengers on Interstate 35, but they are training on highways in California.
Speaker 2:Tesla, on the other hand, trains its cars mostly on data accumulated from Tesla drivers. Preparing to launch the service in Austin has forced the company to confront mundane operational problems like rerouting when cars get stuck and providing customer service, essentially the struggles of not having a human in the car, the engineer said. Waymo and other competitors have spent years grappling with these issues. Musk told investors this month the launch in Austin could include as few as 10 Model y vehicles. The company is looking to hire a team of people to work remotely, using virtual reality headsets to supervise the cars when they encounter problems.
Speaker 1:So this is teleoperation, very normal, and also used in Waymo's. This is the George Hotts contention. It's never been confirmed, but he said, Waymos don't work when the cell phone towers go down. So you know that they're connected to the Internet, and you know that people are watching them. But the the VR headset thing is interesting because I haven't seen that as necessary.
Speaker 1:I I always thought that, when you had a teleoperation team working on, self driving cars, what you'd see is somebody had a big screen or series of screens, and they would be looking at maybe four cars simultaneously, and it would have kind of like green, yellow, red. And it's green, it's just cruising down a clear day on an empty street, no problem. But then it sees a cone that it doesn't understand. It goes yellow and then can kind of look at it. And then red is, I'm really confused.
Speaker 1:I'm stopping the car. Now you need to hop in and take over. And then you're not driving the car in VR, you're saying, hey, I've double checked as a human and I see no humans there, so you can go for it, car.
Speaker 2:Yeah, it's not, I mean But that's fine. The of the day, it's great. It's not unreasonable to think that Tesla rolls this out and there is perpetually somebody monitoring every single minute that the car is operational.
Speaker 1:Why not? It's not that expensive.
Speaker 2:And it's not that expensive. Yeah.
Speaker 1:And Obviously, it doesn't work over the very long term, but it's fine as a way as a path to market. And so the Tesla the Texas Department of Public Safety, which oversees the highway, has not yet received an emergency plan from Tesla, but said it's prepared for the launch. Such a plan would help emergency responders engage with cars if they fail to pull over or if they block traffic, such as other robotaxi services have done. So it seems like the government's actually catching up to this thing this stuff and and it's it's putting a plan in place to say, hey. Like, we want this and people want this, but we gotta figure out what to do if this car freaks out, basically.
Speaker 2:I saw a video somewhat somewhat unrelated, but I saw a video of somebody figured out how to trap a Waymo. A Waymo had was
Speaker 1:used just put a cone on it and stops.
Speaker 2:Yeah. So so apparently a Waymo was in front of this guy's house. Yeah. And so he went and just took tape and just put four pieces of tape around, like, the the main sensors.
Speaker 1:The sensors.
Speaker 2:And so the the car is, like, on, and it's like running, but like, I can't. And I was like It's mean. I don't support abuse of any type of robot.
Speaker 1:That person's first to go when the Yeah. When salvation day They're cooked. Yeah. They're cooked. Terminator's not gonna look kindly on that behavior.
Speaker 1:Anyway
Speaker 2:Spectro bots.
Speaker 1:Full self driving could take over most of city driving on city streets. FSD launched to the public in 2022. By last year, more than 2.5 2,400,000 cars were using it. That's a lot of data. Several several autonomy researchers and engineers said Musk's confidence in Tesla's ability to quickly expand its autonomous vehicles to new markets fails to account for the logistics needed to operate ride hailing fleets at scales at scale.
Speaker 1:Yeah. Whether they're driven by a human or a computer, it also glosses over some of the regional differences such as traffic light and lane design that have slowed other companies that they try to scale. And this is the key thing we we'll we'll go into, but this is, like, the really, really important it's a very, very important, underlying strategy to the way Tesla is approaching this versus Waymo. So, Tesla receives video clips from a from an array of cameras mounted around its cars and processes them at a cluster of supercomputers, which it calls Dojo. A primary goal is reducing the frequency with which a human has to intervene in the car's driving.
Speaker 1:This was called on policy learning versus off policy learning. And so you the the car is driving itself. Whenever the human interacts to take the steering wheel or apply the brakes, that's sent as a negative reward to the to the neural network to say, hey. Whatever you did there, that was wrong. The human didn't like it.
Speaker 1:And so go back and and do more of the driving where the human isn't taking over. And and you get a lot of data on that. You build a big a big transformer network, and eventually you get a very strong, machine learning model essentially. So the computer systems handling the data learn differently from humans and sometimes stumble over issues that would be obvious to people. The engineer said, like, this is obvious.
Speaker 1:We've seen this with hallucinations with LLMs. The development has at times relied on feedback from Musk and from YouTubers driving the semiautonomous modes who map out parts of the roads in San Francisco and Florida where the cars struggle. Tesla's sole
Speaker 2:This is Yeah. Citizen
Speaker 1:Citizen journalists.
Speaker 2:AI. Yeah. I guess. Training.
Speaker 1:Tesla's sole reliance on cameras rather than laser and radar based systems in Waymo means its autonomous approach is more prone to mistakes, critics say. Cameras only is not enough and likely will never be enough, says, Sitan Mersili, the cofounder of the autonomous trucking and logistics companies Locomation and Atlas Robotics. Tesla's approach doesn't work, period, said Missy Cummings, an autonomous vehicle researcher at George Mason University. Computer vision is simply not enough for this task. And Betting against against disagree with that.
Speaker 2:Betting against Elon Musk.
Speaker 1:It's not just that. It's betting against it's betting against the way humans do driving. Like, humans don't have LIDAR. We just have vision and we drive fine. And so I've never buy I've never bought this argument, this line of reasoning that you definitely need something more advanced than just a camera because humans are able to drive.
Speaker 1:18 year olds can drive. 16 year olds can drive. And, yes, you need you obviously need to create something that's, you know, human level intelligence and very, very capable, and you need a huge amount of data. But there's there's nothing like, this is
Speaker 2:such a risky reputation of director of the Mason Autonomy and Robotics Center.
Speaker 1:Yeah. And and I and I understand where she's
Speaker 2:coming naval pilot in the eighties.
Speaker 1:Yeah. I mean, I understand where she's coming from in the sense that, like, right now, LIDAR and radar based systems and GPS based systems are seeing better results right now. But to just throw out the bitter lesson and disrespect scale is all you need is a really, really tall order that's been wrong many, many times. And so it's it's a very risky position to be in, and and I don't I don't think it'll pay off well. And the whole theory of this scaling laws and the ideas that you want to, that you wanna just get a whole bunch of data and and crunch it down into a huge transformer essentially, has proven correct many, many times.
Speaker 1:And it also puts you on a different path to scaling because if you have a system that's more hand coded, more customized based on the particular locale, Every time you go into a new city, you need a new team to spin up new records and scan and whatnot and do all these Yeah.
Speaker 2:And her broad point is that laser based LIDAR systems also make errors like computer vision is making today. Yeah. But it's just that layer of redundancy Yeah. That allows you to avoid It's just The mistakes that pure, pure computer vision systems are, are making today.
Speaker 1:It's just, it's just a very strong statement to say camera only will never be enough. Yeah. Because it's literally enough right now in a human. And so I just don't buy this line at all. I just think the timeline to actually scale this up is long.
Speaker 1:Going to take a long time. The idea that you will never be able to operate a car safely with just a camera is ridiculous to me anyway. Analysis last year of Waymo, Cruise, and Zoox and other testers found that computer vision systems are very brittle and likely play an outsized role in crashes in part because they miss obstacles and Yeah. And can hallucinate imaginary
Speaker 2:obstacles that don't exist. What I was saying. Yeah. If you add that LIDAR system, you can add redundancy. And so it's just another effectively, you know, check on, the pure computer vision
Speaker 1:approach. It's difficult to gauge safety of either approach because Waymo's develop deployments are still limited to specific cities, Tesla's system is not yet fully autonomous. Federal regulators are examining how Tesla cars handle relatively common traffic occurrences such as sun glare, fog, and airborne dust, which is legitimate. Musk has counted counted countered doubters by saying that humans manage to drive with only their eyes Got them. But but acknowledged last month that Tesla's robotaxi services won't work in snow, prompting some followers online to offer to help train Tesla by driving more more in poor conditions.
Speaker 1:They're just like, I will do it.
Speaker 2:I volunteer as tribute.
Speaker 1:Musk. Musk also said it's been difficult to train on enough incidents to make sure the the cars can handle them safely because if the Teslas don't get into a lot of crashes, there's not a lot of data there.
Speaker 2:If Elon can add a the the Tesla camera system to a Lamborghini Storato.
Speaker 1:That'd be great.
Speaker 2:I'm happy to put 5,000 miles on it Yeah. In in harsh winter conditions.
Speaker 1:Yeah. Yeah.
Speaker 2:Yeah. You know, at this point, you know, summer's approaching, probably need to take it down to Australia. Yeah. But doing, you know, a road trip through, you know, the Australian winter sounds great, actually.
Speaker 1:Yeah. I mean, this also this also ignores simulation learning and transfer learning, which is obviously something Tesla's invested in a ton and has a very proven proven track record. There was a researcher from NVIDIA at Sequoia's AI Ascent talking about, transfer learning and how they're using generative AI to generate essentially video from the simulated data. So they'll create a physics simulation, basically a video game, a robot picking up an orange or something like that. That that's a physics simulation.
Speaker 1:Then they'll create a ton of variation in the different physics properties to try and inject a lot of noise into the system, basically. But then they'll use generative AI to convert that into video feeds that then they can feed back into the system to train on, and they've seen a lot of success with that. And so I I I'm I'm I'm skeptical that that that this is that big of an issue, but also, like, you could just put LiDAR on the cyber cap. Like, it hasn't been built yet. And if the price comes down, you throw that on, and then and then all of
Speaker 2:a sudden Yeah. Tesla there's companies that Yeah. Tesla could acquire that would immediately give them a massive edge there.
Speaker 4:So
Speaker 2:Yeah. Anyways, let's move on.
Speaker 1:Okay. Well, there's some other commentary around this piece. With the robotaxi network, your Tesla will be able to earn money while you're not using it, essentially paying for itself. It'll go it'll go to work just like you, says Tesla. Very bullish for buying a Tesla.
Speaker 2:Wild This is public company
Speaker 1:can tweet like this.
Speaker 2:Don't use periods anymore. Oh, yeah. I saw, yeah. It's an interesting evolution. Yeah.
Speaker 2:But periods are over.
Speaker 1:Done. And then, Dan O'Dowd, is another, account on here pouring some cold water on the Robotaxi launch. You can almost hear Elon sigh of release a sigh of relief. He now has his excuse for canceling Tesla's June robotaxi launch. It won't be long until Elon claims Tesla was totally ready, but the pesky regulator stopped him.
Speaker 1:Mighty convenient. Do you think Elon ordered NHTSA to send this letter? And so the NHTSA said
Speaker 2:Get him a tin foil hat.
Speaker 1:Get him a tin foil hat. And then Cole Grind says, people say you should sell Tesla because it's hard to build a ride sharing system like Uber and Lyft, but little do they know Tesla already has over 20,000,000 people using their app. Once the Robotaxi launches, they'll be able to use the existing Tesla app for their ride sharing service. This will allow Tesla to gain new customers through app downloads and cross selling of other Tesla products. Once those members become come online, I would not be selling here.
Speaker 1:I would be buying. He's given some financial advice, folks, but we aren't. And then, Rami, who's clearly a Tesla fan, his handle is Tesla explored, says, please send me a video of any other company that can drive me in New York in the rain, door to door, without any interventions. I didn't need to be in the car. I could have easily been in the back seat of my own Tesla Robotaxi, and the result is that it took me to lunch autonomously.
Speaker 1:So he's a fan.
Speaker 2:The level of conviction from the the some of these Tesla fans is Huge. Incredible.
Speaker 1:Huge. It's similar to the level of It's even
Speaker 2:beyond our little corner of tech. Right? It's an entirely Yeah.
Speaker 1:New level. But I mean, we see this with other companies. Like, we see this with the, like, ramp fans. Like, they go crazy. Totally.
Speaker 1:All there there's all these YouTubers
Speaker 2:and they're People saying would like defend
Speaker 1:their life. Exactly. Yeah. It happens lot. Because, like, I mean, they they know that time is money and they wanna save both.
Speaker 1:And so they create whole YouTube channels all around just easy to use corporate cards, bill payments, accounting, a whole lot more all in one place. They're just obsessed. It's crazy.
Speaker 2:Seeing people get time is money save both
Speaker 1:Lots of tattoos. Lots of lots of ramp tattoos out there for sure. Oh, some people start whole live shows, whole podcast just Totally. Just to promote
Speaker 3:ramp basically.
Speaker 2:In service.
Speaker 1:In service of ramp. In devotion. Yeah. They call them like you know, there's like the Teslarati. They're like the ramp a ratty.
Speaker 2:The ramp a ratty.
Speaker 1:Ramp a ratty. Yeah. The Illuminati.
Speaker 2:Yeah.
Speaker 10:It's great.
Speaker 1:Well, if you're looking at ramp. Long Tesla, short Tesla, whatever your decision is, go over to public.cominvesting for those who take it seriously. They got multi asset investing, industry leading wheels. They're trusted by millions. Thank you for the soundboard, Jordy.
Speaker 2:Thank you to public.
Speaker 1:Should we talk about the giants of Silicon Valley, how they're having a midlife crisis over AI? This was an interesting post in The Wall Street Journal because it was, it kind of all stemmed from an interview with Sarah Guo who's been on the show. Very cool. She did a podcast with The Wall Street Journal, bold names, venture capitalist Sarah Guo, surprising bet on unsexy AI, and they did a nice little write up here. So they say, one minute, you're upending established industries as the younger disruptor.
Speaker 1:The next, you're staring into the abyss eating glasses, as Elon Musk likes to say, watching the disruption at your door. Most, if not all, of the magnificent seven are in that position weirdly trying at the same time to figure out the threat of ardinal artificial intelligence to their kingdoms. That dynamic has been on display for the past few weeks. Alphabet stock dropped more than 7% after a senior Apple executive disclosed that Google search traffic on its service on its devices using Safari fell for the first time in twenty years. You've they've had Safari around for twenty years as a Google partner?
Speaker 1:That's crazy. It's so long. Google clarified it continues to see overall search growth even from Apple devices, putting Apple in the truth zone. Don't knock our stock down, Apple. We're still growing.
Speaker 1:For his part, chief executive Tim Cook is trying to buy time for his company pushing investors during his latest earnings call to be patient with the iPhone maker's delays around AI features. Then there's Facebook. Mark Zuckerberg is attempting to brain paint a bright future for his ad dollar juggernaut as something of an AI buddy for the lonely. That that that was kind of taken out of context from a Dwarkash interview. Did you see this?
Speaker 1:Dwarkash said something, and they attributed it to Zac. It's like every time. So bad. Anyway, even Musk
Speaker 2:How about an AI buddy?
Speaker 1:Even Musk seems to be sweating things as he returns from his Doge sojourn to Tesla seeking to counter slide an electric car maker's stock price with promises of deploying driverless cars. We're not on the edge of death. Not even close, Musk told analysts recently. We love to hear it, and we saw it in the stock over a trillion dollars now. Not bad.
Speaker 1:His protest sounded like that Monty Python and the Holy Grail character about to be thrown on a pile of corpses. I'm not dead. I feel happy. To be fair, none of these giants are dead yet, and they have lots of reasons to feel happy. They are wildly profitable pillars of corporate America, which we love to hear of corporate And together, they represent around $7,000,000,000,000 in market value.
Speaker 1:Yet the crossroads, they all stand at collectively, and how they react individually look like ready made case studies for twenty first century update to the classic business school So on the Tesla innovators to learn.
Speaker 2:On the Tesla note Yep. People that were shorting Tesla over the last couple months, right, sales of the cars have been abysmal. Literally, every market is down, like, double digits. It's, like, so bad just getting crushed by every other EV manufacturer. They're having to sell cars clearly
Speaker 1:No black pilling. No black pilling.
Speaker 2:No black I'm I'm not I'm I've I I just have to the the this is why I'd never be a short seller because you could have looked at all the data for Tesla and said, this where is the bottom here? I mean, like where Totally. Like, why is Tesla you know, and it's like, Elon Musk. Don't betting against
Speaker 1:Never bet against him.
Speaker 2:It's okay not to invest with him. Yeah. Yeah. But betting against him, that is That's rough.
Speaker 1:Tempting. And, again, like fate. It's like, are these this is what we keep going back to with, like, the Trump tariff things and stuff. It's like, are these things stuff he can roll back? Yeah.
Speaker 1:Like, okay. So what what what's going wrong with Tesla in this theoretical bad scenario? Well, like, Elon's not spending enough time there. Right? He's spending too much time at Doge.
Speaker 1:Well, can he quit his job at Doge and go back to be CEO of Tesla? Like, yes. Okay. And is that what he did? Yes?
Speaker 1:And then
Speaker 2:it's just stopped about $350,000,000,000
Speaker 1:somewhere. Oh, like the LIDAR isn't working? Like, could he add LIDAR to his cars? Like, yeah. Like, could he map every city?
Speaker 1:Yes. Could he you know, there's like all these things that people are like, oh, he'll he'll never he's not doing this.
Speaker 2:It's impossible.
Speaker 1:Oh, he's like he's over he's politically, he's too right wing. Like, well, could he come out and endorse Gavin Newsom? Like, could he live out? Could.
Speaker 2:Could he live
Speaker 7:out? He could.
Speaker 2:Yeah. He could. Like, anything's possible. Too late. Anything's possible.
Speaker 2:It's never too late. Well, let's talk about the art market. I wanted to have my dear friend Dylan Averuscato on.
Speaker 1:Potentially the most important topic the show. Important story
Speaker 2:of today and certainly potentially the week.
Speaker 1:Yes. I think so. It's it's shaking up Silicon Valley. There's a lot of there's a lot of venture capitalists, a lot of exited founders, post exit founders, and a lot of technology journalists who have generational wealth who are at Christie's right now bidding on modern art. And so they'll want an So we're going to Dylan to the studio.
Speaker 1:Welcome to the stream. How you doing? Thank you for joining.
Speaker 2:Thank you for joining, Dylan. Dylan, it's great to have you on the show finally. Long overdue. You've given us a lot given a
Speaker 10:first time caller.
Speaker 2:Lot of great lot of great pointers. But anyways, I wanted We were we were gonna cover the story so thank you for being able to hop on on short notice.
Speaker 8:Do you wanna give
Speaker 2:a quick intro and then we'll dive into the story just so people have some context?
Speaker 10:Yeah. Sure. I'm Dylan, founder of Crypto the Game, which is an interactive crypto survival game. Think HQ Trivia where I worked for the Horizon Ball meets Survivor or Squid Game or Hunger Games. We've had a couple of viral seasons.
Speaker 10:And before that, I was Jordy's head of marketing over at Party Running Capital. So we go way back and
Speaker 2:Way back.
Speaker 10:So I could be here.
Speaker 2:Way back. Awesome. Why don't you give some context on your your background as an amateur but successful art collector as well? Yeah. Yeah.
Speaker 2:I've kind of
Speaker 10:always been an obsessive collector of things. You know, growing up, I collected Beanie Babies, Pokemon cards, baseball cards, sports memorabilia, always collecting. Fast forward to, I don't know, probably, like, 2017, '20 '18, my, wife and I moved into our first apartment together, had very sterile white walls, and, decided that, I guess, like, collecting art would be, a good way to kinda scratch scratch that itch of collecting and and be something that we could do together. So kind of just started as something we could do together. I kinda browsed Instagram.
Speaker 10:Back then, there was, like, a much more intuitive kind of, like, explore tab. You were surfaced kind of, like, art if you followed artists, and pretty much just cold DM'd this artist, also coincidentally named Jordy, Jordy Kerwick, whose art immediately spoke to me, sent him a DM. He didn't have any gallery representation. He made, you know, buying a piece and commissioning a painting as easy as, like, texting with a friend. You know, I think the art market historically has been so hard, to get into for young collectors, and there was, like, zero friction in the way that we went about it.
Speaker 10:I think we got a little lucky in the sense that he eventually, like, blew up, got kind of, like, gallery representation and tier one gallery representation. He was breaking records, you know, in similar auctions to what we're about to discuss. And kind of because of that, I don't know. I almost, like, made a name for myself in this, like, Instagram art community. And, yeah, I've kinda just, like, catapulted into into the art collecting scene.
Speaker 2:How's the p and l, though? On paper, I'm sure the the returns are fantastic. Have you ever do you ever sell, or do you just buy?
Speaker 10:I don't. No. I just buy. I don't know. I you know, the everyone always asks kind of because of that, like, what to buy and how to go about it.
Speaker 10:And my advice is always just to to buy what you love and and buy what speaks to you. And it kinda sounds like, you know, pretty simple advice, but anytime I've looked at a piece or, like, had a recommendation from a friend or a fellow collector on a piece that was going to be a great investment or was gonna do really well has never worked out. And I've always kind of regretted buying and having on my wall and kind of, like, looking at it, versus the stuff that we do buy and and collect and and kind of, like, do it for the right reasons and have always been kind of like rewarded on paper basically for for those early bets.
Speaker 2:Yep. Great. Well, let's talk about this story and then I'd love to get your update on kind of the broader art market. So we'll Yeah. Read through it.
Speaker 2:So, the journal covered it this morning, the Mondrian sells for 47,600,000.0. Christie's Modern Art Sales kick off a week long series of art auctions that will gauge the art market's strengths amid broader economic uncertainty. People are wondering, will our values soar or flop or, you know, in general, what the liquidity will be like.
Speaker 1:So So this was at the kind of low end of the estimate, the 1922 work composition with large red, plain, bluish gray, yellow, black, and blue was expected by Christie's to sell for between 40,000,000 and 50,000,000, but only one bidder emerged, and it sold quickly for $41,000,000 or 47.6 with the auction house's fees. The work still ranks as the third highest price ever paid for the artist, but the record remains 51,000,000 paid three years ago from Mondrian's composition number two. Both examples feature a large red square, which the auction house hoped would help because collectors tend to pay a premium for Mondrian's spare asp abstracts that contained cherry hues, said Alex Roder, Christie's president. Red always helps, simple as it is, because it's a people that color, it's a color that people like, said Roder.
Speaker 2:There you go. That's what Dylan's talking about.
Speaker 9:Never gonna just like
Speaker 1:Never brown. Buy brown.
Speaker 10:Doesn't sell.
Speaker 1:Yeah. It's also particularly small. It's only about like two feet by two feet or something. And so I saw on x, Bornosaur, a, an NFT profile picture says, this tiny Mondrian just sold for 47 and a half million dollars last night without anyone batting a batting an eye, and yet people think AAA natively digital grails are overpriced at 2 to 3,000,000, much, much higher. Kinda saying, hey.
Speaker 1:Maybe we should pump the pump the the market of the Bored Apes.
Speaker 8:Yeah.
Speaker 2:Let's get
Speaker 1:let's get bored apes in the conversation.
Speaker 2:Yeah. Let's get them back in the conversation. Anyways. Anyways, were you surprised at how this this got priced, Dylan? Were you following it at all?
Speaker 1:Or or or what Yeah. Mean, there's a lot of, like, there's a lot of uncertainty in the overall economy. Right? So Yeah. I mean, you would expect that, like, art kind of oscillates, but, I mean, do you follow this?
Speaker 1:How do you even track the overall art art market these days?
Speaker 10:Yeah. I mean, it's exact it is so similar to, you know, venture investing. I know you kinda joked about it at the top, but, especially when you look at emerging markets and if you buy from their studio in the same way that I did with Jordy Kerwick, it's basically getting into a friend and family round, at least with kind of, like, living artists and artists that still have gallery representation. If you do, if they do basically sign with an up and coming gallery, that's the equivalent of a seed round. And then by the time they do get that kind of, like, tier one Gagosian level representation is the equivalent to an entry center or a, you know, a tier one, fund, like, backing them in, like, a growth stage round.
Speaker 10:But, yeah, I think you you referenced that kind of, like, monitoring record that was set three years ago. There were emerging artists. Everyone bay basically, like, at the time of Zurp, like, everything was going crazy. And we saw that both in, you know, basically across every single market, art not withstanding. So I think the way that I personally judge it is is basically just off of the information that I receive.
Speaker 10:In 2021, '20 '20 '2, I was reaching out to galleries kind of cold and, being told that there were wait lists, and the deal flow was basically, like, very, very hard to come by. Fast forward to, you know, a few, a few years from then, you know, galleries were kind of, like, reaching out to me. You know, hey. I know you were initially interested in this artist a few years ago. Here's all of this work that's available.
Speaker 10:I'm willing to offer discounts, and that immediately signals to me that, you know, times aren't good for galleries. But I do think that, the the best way of predicting, like, how these auctions are gonna go are based on basically how New York Art Week goes. And that was, this past week, which was kinda headlined by Freeze, but they also had to take FAT as well as Nada, which is kind of, like, the more emerging art fair. And from what I can tell from everyone that I've spoken to, that was kind of, like, on the ground. It was a much more optimistic New York Art Week than years past.
Speaker 10:Gagosian sold a $3,000,000 sculpture on the floor. They sold out, you know, tons of boots that were sold out kind of, like, on day one. Love you, Harry.
Speaker 1:I love a $3,000,000 sculpture selling on day one. That's great news.
Speaker 10:Yeah. So I think, like, that usually sets the tone for how these kind of, like, auctions go. Yeah. There's been a ton of buzz around, the Bass House. I'm not sure if you guys are familiar with the Bass House, but, it was a commissioned,
Speaker 1:like We both are, but can you explain it for the fans who might not be?
Speaker 10:Sure. Yeah. It's an architecturally significant home in Texas, that these two kind of, like, well known collectors, commissioned a very famous architect to design this mid century modern house in Texas, specifically designed to house their collection of Rothko's and and Warhol's and, you know, pretty much every big name. And they are auctioning off the collection, which everyone is in in our market is very surprised by because you would think you you know, you commission this home to specifically house this collection. It should eventually become a museum.
Speaker 10:And I think that kind of, like, bodes well for what they think and what a lot of people think is is going to be a lot of liquidity kind of, like, heading into these auctions. Having said all of that, I would say if we had this conversation, like, a week or two ago, I think it would be a lot more, pessimistic or concerned. But given the very, like, recent kind of, like, positive news and kind of, like, market turnaround, I think there's some buzz kind of heading into heading into tonight.
Speaker 1:Yeah. I I have a follow-up question. I mean, the size seems significant. I feel like there's probably a sweet spot for the scale of a particular you mentioned that, sculpture. We're recording not too far from the Broad.
Speaker 1:You walk in, there's this massive Jeff Koons balloon animal. Yeah. I I've I've I've I've walked in when I was in New York once. Walked into Jordan Wolfson. I don't even know if it's a sculpture, but it's like a performance art piece.
Speaker 1:I don't know if you're familiar with Jordan Wolfson, but it's like this crazy interactive, like, machine that has motors and stuff. And at a certain scale, it becomes like, how do you even collect that unless you have, like, a museum to put it in?
Speaker 10:That's who's buying it is is the institution. It has to be. Like, I would imagine, you know, the the $3,000,000 sculpture that Gagosian sold that I mentioned was a Kunz. And I you know, the Broad bought their Kunz sculpture from Gagosian, and I would venture to guess that the the bidder who or or the person that bought this $3,000,000 sculpture was an institution looking to build out their collection for the museum.
Speaker 2:Yeah. Is there a difference between I mean, yeah, I'm curious not to not to switch gears too much, but I'm curious. Is Christie's even slotting in NFTs this week at all, or are they so over it that they're not even
Speaker 1:Yeah. Because it was a big thing, like, three years ago.
Speaker 2:Yeah. Mean, Sotheby you gotta give Christie's Sotheby's
Speaker 1:to the Beeple.
Speaker 2:Yeah. You have to give them some credit for moving quickly and getting NFTs into these auctions early, but I'm curious if they're doing that now.
Speaker 10:So this week is kind of like the hero week of every year, and there's there's no way that in, like, a, you know, twenty first century, like, masterpiece auction, you'll see an NFT, but I do think they are still accepting crypto and and selling NFTs. All the main major auction houses kind of have daily auctions that they're running. You know, you probably won't see a Beeple in something as kind of, like, highly publicized as this week's auctions, but I I definitely think they're still selling digital art for sure.
Speaker 1:Yeah. Yeah. There's one NFT that I think belongs in the conversation. Have you heard of this Moxie Marlinspike NFT? So he's the founder of SIGNAL.
Speaker 1:And during the NFT boom, he wrote a very technical deep dive on kind of some of the flaws with the way NFTs were structured in that he he basically designed an NFT that displayed differently on OpenSea than in a Phantom wallet than in an Ethereum wallet. And he was making this commentary around the importance of platforms and the role that a firm like OpenSea plays in the art market and how, like, the the code is not purely on chain because it can be represented differently in different places. And and it was kind of this, like it was kind of a top signal at the time. He wrote it when NFTs were super hot, and, obviously, he came to it from a very, engineering mindset perspective. And I think that it even though he never sold it and it doesn't have any value and it never, like, minted in the traditional sense, it is an NFT, and it has this historical provenance and the story around it that I think as we look back on the NFT boom, we could remember that particular story as an interesting commentary on the entire industry that could actually drive the value up.
Speaker 1:So I was considering buying it from him for a while, but I didn't I didn't have the guts to throw out an actual price.
Speaker 2:Yeah. Yeah. No.
Speaker 10:No. Well, I I do think similar to how there's paintings and there's sculptures and there's basically all different forms of, you know, there's mixed media art. Like, I do think digital art definitely has staying power. Probably just, like, in the more experimental guys that you were talking about. And then just to quickly touch on, like, size as being a blocker.
Speaker 10:Sure. I think once you're talking about these, like, you know, eight, nine figure pieces, it's almost always someone that can house or store, either in their in their museum or in their home, like, a massive piece. But just for, like, the everyday collector or someone that might be listening to this, like, personally speaking, like, I have gigantic canvases that are still rolled up that I have absolutely zero wall space for, but that is, like, an addiction and a problem. And I do think that, you know, buy for the size that feels right to your home and and something that you actually wanna hang.
Speaker 2:Well, we're moving into a new studio very shortly and we're certainly gonna have some wall space so Amazing. We'll we'll only charge you a small storage
Speaker 8:fee.
Speaker 4:I'll pump my bags.
Speaker 2:As a yeah. Family family and friends. Anyways, great to have you on. Yeah. Come
Speaker 9:back on again Thanks again.
Speaker 1:Thanks much.
Speaker 2:We'll talk more. And let us know how things shake out this week in the art market.
Speaker 4:Cool. Talk to soon.
Speaker 2:Later.
Speaker 1:Talk to you
Speaker 5:later.
Speaker 2:Was just pulling up so OpenSea.
Speaker 1:Let's bring him at because he just has five minutes and he's all the way from Saudi Arabia. Jared, Matt, Marks. But reporting live
Speaker 2:Reporting live. From From Riyadh.
Speaker 9:Saudi
Speaker 1:Arabia. He's there on the ground.
Speaker 2:Better he better be in the traditional In
Speaker 1:the traditional oh, we were expecting a a suit. We were expecting more pageantry.
Speaker 6:Yeah. No no sob from me today, boys.
Speaker 2:But,
Speaker 6:I am calling in from a nondisclosed location in Saudi. Can you hear me?
Speaker 2:Yeah. Yeah. You sound great. You sound great. Loud and clear.
Speaker 1:Give us the breakdown. Why are you there? What's going on? What's the mood on the ground?
Speaker 6:Yeah. So, I'm here mostly just to see friends.
Speaker 1:Okay.
Speaker 6:But, but beyond that, there was an event today, where there was a US delegation. President Trump was there. The conference, Mohammed bin Salman was obviously there. And a slew of top tech leaders from The US also came. So we had Jensen Huang, Elon Musk, etcetera, etcetera.
Speaker 6:Know, all their names,
Speaker 2:you can
Speaker 6:come up online. Yep. Can you come here? Yeah. Yeah.
Speaker 6:In Memphis. In terms of the big
Speaker 2:the the big headlines, look. You guys can look them up.
Speaker 6:The big ones are 600,000,000 in new new committed capital Billion. Sorry. 600,000,000,000 in new yeah. 600,000,000,000 in new committed capital. But I don't wanna talk about that at all.
Speaker 6:What is the most interesting thing from today is the fact that sanctions on Syria have finally been lifted. Now I know between the three of us, every time we get together, it's like when are
Speaker 2:we finally gonna be able
Speaker 6:to enter the Syrian market? Well, boys, that day is today. Alright. So Yeah. No.
Speaker 6:It's today.
Speaker 2:The day everybody's been waiting for.
Speaker 1:We should start distributing the show there for sure.
Speaker 6:Yeah. No. A %. A lot of people don't realize, look, Syria, after the civil war started in 2011, our companies have just not really been able to serve customers there. So the Syrians don't really know the joy of US big tech yet.
Speaker 6:Mhmm. And, you know, they miss the whole web two point o mobile development. So most of the groups that are servicing them are from the Chinese sphere versus the American sphere. And I am beyond excited for the new crop of talented founders that are gonna descend on the Syrian country to spread them the joys of American big tech. So, you know, if anyone is watching and is going to be launching any number of companies in Syria, my DMs are open.
Speaker 6:I could not be more excited.
Speaker 2:Very cool. Wow. 23,000,000 people in Syria.
Speaker 1:Go get them. Go get them. Future customers.
Speaker 6:23,000,000 people, they've had double digit inflation for, like, the past decade, which means that they are a prime market for stablecoin adoption. Yeah. So every stablecoin neobank needs to be descending into Syria and seeing how quickly they can dollarize the entire country. If anybody is using the Syrian pound in five years instead of US dollars on blockchains, we have just massively screwed up as an industry. So please request for start ups we are looking to fund.
Speaker 1:That's very cool. Super interesting. What about artificial intelligence? NVIDIA launched some stuff. Have you been hearing any rumblings about AI stuff going on?
Speaker 6:Yeah. Look. The fact that Jensen was here today on the main stage shows that we are likely softening some of the restrictions on being able to export GPUs to the kingdom and other parts of The Middle East. I might have the numbers off, but I think there was an announcement that, like, a purchase order of 18,000 GPUs has just been approved for the kingdom. If you're listening and that sounds small, not enough to build, you know, a hyperscaler or a massive cluster, you're correct.
Speaker 6:But this is clearly the first of many. The entire region is rapidly searching to turn their, you know, petrol based capital into, you know, token based capital in the future. So expect expect continued investment from the region trying to diversify out of their kind of one main industry
Speaker 2:Yeah. Humane is future
Speaker 6:via AI.
Speaker 2:Just for extra context. So Humane, the AI subsidiary of the PIF, is going to be purchasing hundreds of thousands of advanced GPUs over the next five years. So starting with, I think, the number that that you said 18,000 and and scaling Yeah.
Speaker 1:And the first plant is, I think, half a gigawatt. Right? Something like that.
Speaker 2:Your take on do you think that we started calling data centers AI factories? Do you have a take there? Does it just sound cooler?
Speaker 6:Yeah. It lowers your cost of capital.
Speaker 2:Yeah. And that's the most important thing that anybody can be focused on at any given point.
Speaker 1:Yeah. What what is the word on energy? Obviously, with AI training, it makes so much sense to put big data centers there. But at the same time, they're trying to get away from the, hey. We have a whole ton of free energy because we have so much oil.
Speaker 1:There's also a lot of sunlight, so maybe there's solar in the future. What are the hot energy, sectors that people are looking at?
Speaker 6:Yeah. So a lot of people are, with regard to energy, talking about a potential nuclear deal. Mhmm. While there is an abundance of oil in the kingdom, burning oil to power power plants is not necessarily the most efficient use of oil. You know, I don't have the numbers off the top of my head, but if you look at the amount of oil that is burnt in order to air condition all the buildings in the kingdom, it's like an exorbitant expense.
Speaker 6:So some Gulf States, are slightly more advantaged in that they have larger deposits of natural gas versus crude or shale, which is just you know, it's more more efficient in terms of converting into energy. And with regard to solar, solar in the desert has not really taken off as much because my understanding is there's lot of wear and tear that comes from the sand and that you need to build a series of protections, and the elements are not necessarily kind and, you know, a 30 degree Fahrenheit weather as sand rapidly batters them. So we'll see what happens. But, yeah, obviously, been a bunch of companies that are super interesting like Crusoe. I might be mispronouncing that.
Speaker 6:They're doing things like capturing excess flare, using that to generate energy at first to do crypto mining and now to run data centers. So expect there to be a lot more, as Jordy put it, AI factories coming out of the region. And there's a massive focus on on renewables and alternative sources as well to power these things because people would rather sell their oil versus use them to, you know, spin a water turbine.
Speaker 2:Yeah. That makes sense. Do you think you or Jensen go to more conferences?
Speaker 6:I I really don't go to that many conferences, guys. You know, I'm I'm I'm about to hit my quota for the year and then I will retreat to a dark room instead of my laptop for the next nine months.
Speaker 2:Yeah. You do it right though. You do it right. You go to you go to just the right ones. I we've been just, like, not not even intentionally, but paying attention to Jensen's travel schedule, and he's at a new conference pretty much every single day.
Speaker 1:But What's the what's the rest of the mood around crypto broadly? Is there a push for Saudi Arabia to build a position in Bitcoin, kind of a Bitcoin national reserve from their public investment fund? Are they into Ethereum, Solana? Is there is there is there even a thesis from the from the sovereign wealth fund around crypto, or is it kind of just general hand waving around, hey. We want crypto to be friendly generally.
Speaker 6:Yeah. So the holdings of PFR public or PIF, the public investment fund of the kingdom. As of now, there's no crypto holdings in that, except via, you know, funds that they're investing downstream. In terms of, if it is going to emerge as a crypto hub, that is still yet to be seen. Crypto is largely legal in Saudi.
Speaker 6:What is interesting, though, is, when you look at countries that have been super friendly to crypto in the region, mainly The UAE. Right? There's a lot in Abu Dhabi. There's quite a bit in Dubai. The customers that they tend to cater are not born Emiratis.
Speaker 6:Right? The number of of Emirati citizens that necessarily will make use of crypto products in terms of giving them access to banking is fairly low. Right? These are nations that are mostly staffed by immigrants, you know, expats that are choosing to live there. But when you look at Saudi, even though crypto is legal here, there are some studies that show, that in terms of Gulf Region, it has the highest penetration from a individual user adoption space, just how many individuals are holding the coins.
Speaker 6:So I think that as the regulatory framework flushes out a little bit and as, you know, more and more voices inside of the Ministry of Finance and the Central Bank here grow louder, we should expect to see a softening of the rules. And then the end state of that is probably a pretty robust, environment specifically in The kingdom. But remember, the people that can benefit from crypto the most are regions that have, you know, high levels of inflation, low levels of banking, highly mobile first in terms of, you know, payment infrastructure and things like that. And that doesn't necessarily describe all the Gulf States the best. So, you know, jury's still out on how much and how quickly penetration will come outside of just, like, investment speculation, which, of course, you hear rumors about tons of family offices here building massive positions, but it's just very hard to validate that.
Speaker 1:Yeah. With with with with the new 300,000,000,000, 6 hundred billion investment, is that one of those things where the investment was already gonna happen and they're tagging it for this press release, or what is the structure? Is there any is there any clarity on, like, the structure of that deal? Is that just investment dollars flowing into American investment funds or specific buying of an of American goods? Do you have any clarity on what what what we're gonna expect here?
Speaker 1:I
Speaker 6:haven't really broken it down yet, but I I think the right way to think about it is it's gonna be a lot of infrastructure investments and a lot of purchasing of American goods. Right? So majority is talking about the hundreds of thousands of GPUs that are gonna be acquired. That's, you know, the pool of capital that that that where that's gonna be coming from. Yeah.
Speaker 6:But, no, I mean, they they specified they wanna invest in energy infrastructure. They wanna invest in data centers. They wanna invest you know, ports and
Speaker 9:just anything.
Speaker 2:So, I
Speaker 1:mean, it could even be, like, more oil rigs in the in the short term as they you know, they're they're moving away from oil, but, you know, they're obviously still producing a lot of it. And American companies have kind of a dominant position in the, you know, oil and gas infrastructure market. So they might be buying for that.
Speaker 5:Totally. So
Speaker 6:we'll see. And, also, part of that is a massive defense spending bill Yeah. Or a defense spending agreement. I think it was a hundred and 43,000,000,000 that they committed. And, you know, just socially talking with some of the people from the Ministry of Defense that you ran into at the conference, they were like, oh my god.
Speaker 6:Have you heard of this company called Cyronic? Have you heard of this company called Andriel? They're really gung ho on some of the non prime upstarts coming out of The States. And, yeah, I I have, like, three different guys from the Ministry of, Defense. They're like, hey.
Speaker 6:If you meet any founders building interesting new defense companies, refer them to us. We want to potentially pilot them. We wanna potentially invest in them if we wanna make a purchase contract. So, yeah, so it's an exciting time for sure.
Speaker 2:I would like Early stage. Would like to see somebody with a Daytona SP three using it as a Launchpad for a Roadrunner. So, like, you're driving the Daytona, launching the Roadrunner off the back.
Speaker 1:I mean, in terms of, like, early stage founders, like, how early is too early to start engaging with someone, like, as senior as, like, a ministry of defense official? I feel like you need to have a product that can be demoed. But when we talked to the secretary of the army, his message was very much like, we wanna hear from startups even at the early stage. We have a proving ground. You can come test here.
Speaker 1:We want to work with Silicon Valley. That seems like it's certainly a vibe shift in America, but it sounds like that's happening over in Saudi Arabia as well.
Speaker 6:Absolutely. I mean, I I mainly do not focus on defense, I don't wanna say anything too out of turn. But I think post the Ukraine Russia Conflict, people saw how important it is to have the most up to date equipment for the battlefield. So in the same way that a lot of companies immediately went over to Ukraine and Russia, immediately went over to Israel following October 7, there's probably an increased appetite to try all new things and see where it goes. And if you have a prototype, it's probably better than not having a prototype.
Speaker 6:But if you have good contacts, it probably is a good idea to get in touch earlier rather than later.
Speaker 2:Yeah. I think oftentimes the conversations start, but no purchase activity can actually happen until The US has actually Yeah. Appropriate. Approved it and said, this works. We'll buy it now.
Speaker 2:You can export it to allies. But, anyways a question. We don't need to get into What what ITAR stuff.
Speaker 1:Mood around the trade war generally? It feels like we're almost in, like, post trade war discourse. It's a distant memory at this point after Sunday and Monday. But are people still thinking about tariffs, or has the conversation just completely moved on?
Speaker 6:Yeah. The the the day opened with tariff conversations. So Scott Passant, started the day, and it was very calming. You know, he he he got up. He talked about the negotiations with his Chinese counterparties.
Speaker 6:He made some very interesting points around how while, president Trump and, Xi had a very strong relationship, some of the people more junior, in the CCP perhaps, did not share his warm feelings towards our president. So he he mentioned that a lot of, the talks in Switzerland were about, you know, showcasing and building favor with some of the, you know, second and tertiary level folks within the Chinese government, and and came out and was very much, we don't wanna trigger an embargo on Chinese goods. We don't wanna trigger a double embargo. So the tariff rates came down and and talked about a number of other countries he's gonna negotiate with, and it was very much a non escalatory tone. And I don't think it's a surprise at all that the, you know, US delegation chose to start the day out that way.
Speaker 6:So so, no, tariffs weren't really talked about after that because Bessen kind of, kept everybody at ease. We'll see how much that remains and if we continue to, lay off and have more ninety day reprieves and more agreements negotiated or if, you know, tomorrow things ramp back up again. But for now, I think people were pretty pretty calm.
Speaker 1:Very cool. Thank you so much for taking the time.
Speaker 2:I know it's late. They are very clearly star cast. Thank for just throwing on the suit just to pop
Speaker 1:on. Yeah. Just for us. Yeah. Thanks for throwing
Speaker 9:us in.
Speaker 6:Every time.
Speaker 5:Every time.
Speaker 1:See you, dude. Talk to you soon. See you. Let me talk about Linear. Linear is a purpose built tool for planning and building products.
Speaker 1:Let me get some soundboard, Jordy. Meet the system for modern software development, streamline issues, projects, and product
Speaker 2:road The standard for product development Yeah. It is the backbone of
Speaker 1:The global economy.
Speaker 2:Of the global economy.
Speaker 1:Of the global economy.
Speaker 2:Many people are calling just considering that big tech is, you know,
Speaker 1:the This really goes on for
Speaker 2:a long Well, we got Thank you, Lenire,
Speaker 1:for supporting the show. Labs coming in the studios. He's talking about stoves, but also trade tariffs, manufacturing. I wanna ask him about what it takes to build a BYD in America, and I wanna know the history of b o BYD, what he's learning from that company. And I also wanna get him to sign up for Numeral because I want him to put his sales tax on autopilot.
Speaker 1:Want him to spend less than five minutes per month on sales tax compliance. But, Sam, welcome to the studio. How are you doing, Sam? Hopefully, we'll have you. Hey, Sam.
Speaker 1:Welcome. Welcome.
Speaker 2:Welcome. Sam. Welcome. It's great to have you. Good to have you How'd you sleep last night?
Speaker 2:Better than than you have for the last few weeks?
Speaker 4:Yeah. It was it was pretty good. I think I got the notification at, like, midnight on on, like, was it Sunday night or something like that? And I was like, oh, sweet. I didn't expect that, but I did.
Speaker 4:And that's why I didn't panic. But they and so so for clarification, basically, we I guess Ashley Van scooped this that we do a decent amount of our our manufacturing in China. Yeah. At Impulse, which is the highest performance stove you can buy. And you can go check out his latest video Yep.
Speaker 4:On Yeah. On core memory, the core memory YouTube channel if you you wanna learn more. But the fun part about that is, we probably spent a couple weeks being like, hey. Do we have to pay this a 45% tariff on a bunch of the stuff we build? My immediate calculation was this will stop trade between China and The United States, and a bunch of businesses will not like that.
Speaker 4:And feedback will land from everyone from Ryan Peterson to
Speaker 1:Yeah.
Speaker 4:Someone that makes Brad's dolls to I don't know. Yeah.
Speaker 1:Everything. Yeah. So, I mean, it's only a ninety day pause. Are you trying to get as much stuff in the country right now? Are you scrambling to import a year's supply, or are you thinking that this is the end of the trade war and we're gonna be more or less smooth sailing from here on out?
Speaker 4:Yeah. I mean, I as much as I would so one big thing with hardware companies is, like, a year supply is, a gazillion dollars. So you gotta be
Speaker 2:you gotta be you gotta be you gotta be
Speaker 4:a little strategic about what to grab then. Mhmm. We made sure that our suppliers are multinational and have manufacturing sites in Southeast Asia and other places Mhmm. Including places that are likely scoped to have deals of, you know, coming together in terms of in terms of, like, favorable treatment on the tariff side, Vietnam, other places in Southeast Asia, Mexico, etcetera. And so, basically, the the the idea is just, like, make sure that, like, all the customers that are already paid, we already told them, hey.
Speaker 4:We're gonna cover this crazy even on 45% tariff
Speaker 9:Mhmm.
Speaker 4:Back in the day or a couple weeks ago, we sent them a mess. Then, you know, like that. Obviously, it's a little easier for us to do that now. Still still holding still holding to that. But, but, yeah, the I think the big thing is, like, now at least I've got some breathing room to think conscientiously about what the next steps are for manufacturing of not just our stuff, but, you know, technologies that we're gonna be powering other devices with as well.
Speaker 1:I mean, I know you're you're I know you're a relatively new company, relatively small. But did you actually have to pay any tariffs, or were you able to kind of, like, do a little bit before and a little bit you you did. Okay. So break
Speaker 4:that I think we paid the 45% on a couple things, actually.
Speaker 1:A couple
Speaker 4:things. We we we the custom the bulk of the customer orders that Yep. That are coming in are not subject to that. But, like Yeah. We got, we we've started mass production already.
Speaker 4:Yeah. And we're a bunch of so kind of the beginning of that ends up being kind of samples and, like, VIP influencer units and other fun things like that. We've definitely paid it on a handful of those. Mhmm. The balance of the the balance even that tranche of units is landing, like, pretty soon.
Speaker 4:So we mostly avoided all of this. Yeah. We're kind of lucky that this was an April thing, not a May thing. Nice. To to be to be blunt.
Speaker 4:But, yeah, there was there was a lot of fun on that side where I think if our if our battery pack build hadn't gotten delayed, like, three weeks, there was actually a small chance that we would have had to decide whether or not to pay a very a very large amount of money to get them out
Speaker 1:of port. It's better to be lucky than good. Right? That's the
Speaker 4:nature. So the calculation so I'll give you kind of, like
Speaker 1:Yeah.
Speaker 4:What I thought about and what was in my head as this was happening because I don't think I actually panicked at all. I was like, this is actually an opportunity to talk frankly about what it's actually like running hardware startup in 2025 with a large supply chain with a pretty complicated product with with all these constraints. Right? Yeah. And finally, people care about me.
Speaker 4:Right? Like, you know, finally, this is the main the main news story of the day. So I viewed it as like, let's turn the lemons lemonade. You made a turn the lemons into lemonade.
Speaker 1:You didn't panic. You coped. And it all worked out.
Speaker 4:And I get on Odd Lots and Yeah. It's a place. So so so that was the opportunity I saw. And then the second piece was I was like, okay. So how long does it take for a boat to go from China to US?
Speaker 4:Mhmm. And and then I was like, okay. So by, like, the May, there's probably gonna be some motion on on on something here. Mhmm. And so I kinda had that in my head of, like, there is a shot clock going on before we're gonna have to do some sort of relaxation of some sort of thing.
Speaker 4:Mhmm. And looking at the shapes, the negotiations, and kind of the various players that were, you know, swarming around. And what I've heard privately from I I probably can't say who and what, but, like, just just just in a sense of, like, there were there were there were, there were well known folks that have complicated supply chains that were not gonna wanna pay under 45% duties on their stuff.
Speaker 1:I with Apple. Right? And Apple was kind of like the largest thing. They got the exemption pretty early, but then there was a lot of other discussion about other companies. And at a certain point, you know, the the noise gets so loud, it's deafening.
Speaker 4:The climb down from Amazon on the, like, we won't put the tariffs in the checkout was interesting because it's like, I wonder if there was it it kind of felt like maybe there were there could have been some negotiation behind the scenes on this where they're like, yeah.
Speaker 8:Don't put
Speaker 4:it in there because we're gonna just come back in two weeks kinda thing.
Speaker 6:Well, I think
Speaker 1:they threatened to do it. Right? They they actually rolled out the UI, and then they got slammed by the Trump administration for doing that and seeing it as like, hey. You're you're blaming us, but you shouldn't, yeah. Never has a slight view of yours.
Speaker 2:The question the question I have is, the the debacle of the last month or so change your long term planning in a meaningful way? Because we were talking Yep. In some we were talking on the show and off the show yesterday around this idea that, okay, what do we get out of this? Right? And it and it didn't it didn't feel like we got a lot out of the Geneva negotiations.
Speaker 2:If anything, we got rare earths back Mhmm. Which was a reaction to the initial tariffs. And de escalation is just generally good. Market obviously likes it. We just kind of like round trip back to where we were.
Speaker 2:And John made a point which is that, okay, well if a generation of CEOs like, got it into their head the reality of decoupling,
Speaker 1:does It's not happening right now,
Speaker 2:but it could and
Speaker 6:we need
Speaker 1:to have a plan around it. During this chaotic period. And so I'm sure during that board meeting, you guys thought really seriously about, hey. If this actually sticks, what is our plan? Maybe that wasn't plan a, but at least it's a plan in the plan document now.
Speaker 1:And so decoupling They
Speaker 2:had concepts of a plan.
Speaker 4:So so so Yeah. I I actually have this, like I I I I I don't wanna get super political, but I do think there's this, like, Trump tariff cycle, like, image that that there's a meme there's a meme that's called, like, the Trump tariff cycle. It's like, I add tariffs. The the Democrats have been often spay like, you can argue they've been often spaced with, like
Speaker 8:you know, you can you
Speaker 4:can you can blame, like, wokeness or some of the more, like like, some of the Elizabeth Warren coded economic ideas in terms of, like, oh, we should just break up all our big tech companies because Yeah. Well, that would be and, like, there's a bunch of these these sort of, like, these these sort of ideas that have been, let's call it, anti tech or or kind of on the wrong side of a culture war balance or something like that.
Speaker 1:Yep.
Speaker 4:What's been very interesting is or, like, let's legalize homeless encampments in San Francisco or whatever. And what's been interesting is systematically, so, like, Grow SF has, like, really re and Daniel Murray and all sorts of really reset San Francisco in a in a positive way because, like, the they had to get the egg in their face to learn the lesson.
Speaker 1:Yep.
Speaker 4:But I'm actually excited about the Democrats being negatively polarized into a free trade party.
Speaker 1:Oh, interesting. That's a funny take. Yeah.
Speaker 4:Because you know, because all small stuff
Speaker 1:that I Just as a reaction. Yeah. No. No. That makes a ton of sense.
Speaker 1:That's funny. I we we we have five more minutes. I wanna I want you to walk me through. I'm sure you've studied BYD. I'd love to know kind of, the history of that company, what your takeaways are, and what it takes to build an American BYD in America?
Speaker 1:And what makes BYD what does that even mean, an American BYD? Why is that different than an American
Speaker 2:Tesla or
Speaker 10:something like that?
Speaker 1:Yeah. Exactly.
Speaker 4:Yeah. So I I spoke to I spoke to an ex Tesla person, and I was like I was like, wait. Do you wanna ever build stuff for other people? And it's like and I've actually asked this question for for for a number of different folks, and I've actually gotten gotten a variety of answers. And it's kind of like, he'll do it if it's on the main path of, like, getting something getting to getting to getting to the, like, vertically integrated goal, if that makes if that makes any sense.
Speaker 4:But, like, it's it's unless, like, unless Tesla was forced by the government to be like, you will build tanks or something like that.
Speaker 1:Like Yeah.
Speaker 4:Like, that they're not in that business, and they're never going to be. Yeah. And so if you think of, like, what what, like, BYD has in terms of capabilities, it's like, it's a car company and a car brand. You can buy a car from them.
Speaker 1:Mhmm.
Speaker 4:But, like, everything inside that car is also, like, fractally built by them. So, like, the infotainment system, they're the manufacturer of that, whereas, like, Quanta like, where whereas, like, Quanta or Pegatron or something like that may make that system for Tesla.
Speaker 1:Yep.
Speaker 4:And this goes down all the way into the battery cells and all this other stuff. So there's like they're they're they're, like, the most vertically integrated company you could ever imagine.
Speaker 1:So interesting because you'd think in, a command and control economy, you'd be able to force a kiretsu, like, in Japan even more. Right? You'd be able to force cooperation between a bunch of different companies, but it seems like in China, maybe that hasn't happened with BYD. Am I
Speaker 4:understanding It's it's it's interesting because Yeah. I think it's it's the DNA of the place more than there's, like, a more than more than the policy side. But then the flip side
Speaker 2:of it is,
Speaker 4:so BYD makes stuff for other people, and that's, like, what they do generally. That's what they historically did. They just happened to be a nickel cadmium battery manufacturer that just kept acquiring businesses and, like, bringing them into the fold until they basically had a car business, a lithium ion battery business, and kind of, like, all of the all of the, like, IP needed to build any electric electric device. So, like, that's everything from, like, a smartphone to a car to, like
Speaker 1:Your dreams. They build your dreams. Or whatever.
Speaker 4:And so and so what's really interesting about this is, like, I can like, I could go to a firm like and I can say, hey. Build me soup to nuts a whole device. They will commit substantial engineering resources. But those engineering resources, it's a little bit less like maybe it's it's there's, like, contract manufacturers in the West and stuff like that, but this is like, no. They'll do it with the BYD parts and the BYD process.
Speaker 4:It's it's like, they almost have, like, the best Lego set in in in the world, and they're able to leverage all of that IP as just a really high starting point to be able to kind of develop develop all these devices.
Speaker 1:Yeah. So, I mean, what does it take to build an American version of that? Should we be even thinking about that as a goal? Is that is that a different company, or is that a, you know, a cultural shift in Tesla's strategy? Where do we go from here?
Speaker 4:Yeah. I mean, there there'd be one way to do it. It should be like defense production access. Hey, Tesla. Bill for other people.
Speaker 4:But I I think that would not go over that would go over like a lead balloon and probably is not a good strategic choice.
Speaker 1:Yeah.
Speaker 4:I do not wanna accept that idea. I don't think it's a great idea for Tesla for a bunch of reasons. But, but I do think that there's I've been focused on, like, what parts of the value chain in kind of the electrified device universe. Mhmm. And I say that very broadly.
Speaker 4:Like, this is everything from EVs to stoves to to to phones and stuff like that. Where where part of the value chain is, like, not made in The United States, really high level of integration, both, like, hardware, software, etcetera. And if you have better components, you can make better products. And this is where we realized that on the the appliance industry, just if you go and build appliances in United States today, you buy electronics from China or Germany. And all the guts inside, it's kind of like you're getting, your graphics card from a Taiwanese manufacturer and your motherboard from another Taiwanese manufacturer.
Speaker 2:Have you taken any trips to Germany, by the way? Are they been asleep at the wheel in many ways?
Speaker 4:I've I've actually never been to a German factory, which is saying something that's judgmental against myself, and I intend to fix that soon. Yeah. The I think a lot of what's been going on is all of like, China has been just incredibly good at the final assembly and, like, that part of the value chain. And it turns out that's where a lot of the software defined technologies start intersecting is, like, automated assembly, computer vision.
Speaker 1:Mhmm.
Speaker 4:Like like, building all kind of, like, the firmware and software to make stuff work in an integrated way. And, like, that's the thing that I think people miss about the car industry, and this is probably the the thing to say is the the legacy car companies don't build cars like phones, whereas Tesla does
Speaker 1:Mhmm.
Speaker 4:And China does. And when and I that's a really broad statement, but it's really like you're building an integrated electronic device, not a bunch of individual boxes designed by different firms that you've, like, plugged together. And and you need manufacturers like b y d like a BYD or like a Tesla that can actually go and span all of these disciplines with the same people being able to put the people in these various groups being able to talk to each other versus how, like, a Ford car or a like, one of a major US appliance companies, like, Stove is put together where, in some sense, there's, like, a corporate firewall between electronics box a and metal enclosure b, for instance for instance.
Speaker 1:Can you talk about, like, zooming out in in terms of this reindustrialization, reshoring, industrial capacity? What's at the top of the priority stack? I mean, there are a lot of memes about, like, do we really wanna be doing screwing in iPhones and making those here? We've talked a lot about DJI. It seems like there's a huge gap between Chinese capability and consumer drone manufacturing versus American
Speaker 4:Well, guess who makes DJI?
Speaker 1:Is that BYD?
Speaker 4:I won't say.
Speaker 1:Okay. But but, but then there's also, like, lower level, potentially, like, higher skilled activities like battery manufacturing with the, you know, mineral extraction, all sorts of stuff. What how should we be thinking about it, not just from a consumer perspective, but from, like, a industrial capacity governmental perspective? Yeah.
Speaker 4:So actually, what's really interesting is if I go take an iPhone and I, like, part it all out on a table in front of you and I say, who's actually doing the core engineering and IP of everything in the iPhone? Yeah. It's actually, like, The US and our Asian allies. Like, how much
Speaker 1:of Right? Because Foxconn's a Taiwanese company.
Speaker 4:It's it's it's it's it's Taiwan. But no. But even all the parts, like LG Inatek makes the camera. Yep. Samsung is in display.
Speaker 1:Right? Yeah. A lot of Korean tech in there for sure.
Speaker 4:A lot of Korean Japanese technology in there. So so so the point though is where where is China really good? It's like it's like it's the assembly, the integration, being able to kind of span all of these disciplines. So so if I was to if I was saying what what I think is really important is, I think I think Noah Smith has a he's my tenant, so I have to show him. Yeah.
Speaker 4:But, I think Noah Smith has a good take on this, which basically, like, The US is missing out on the technology of the future. And China actually has explicitly said this where they believe that the tech stack of the future is the electric tech stack, basically. It's like it's like batteries, power electronics, motors, that whole thing. And it's like, you can build a robot. You can build a drone.
Speaker 4:You can build a car. You can build smartphones and consumer electronics. That spans the gamut of like, that is the technology stack. Yeah. And in some and it's rare earth magnets, stuff like that.
Speaker 4:For some reason, The US just, like I think it's basically the o eight recession and, like, a lack of manufacturing investment afterwards meant that, like, we never actually picked up that stuff with one notable exception, which is Tesla. Yeah. And so and and actually SpaceX as well. So, like, Elon did this twice. We should reverse engineer y.
Speaker 1:Well, that's why we're talking to Elon Musk of stoves. We're we're we're very happy
Speaker 2:about have been saying this. The people have been calling you Noah Smith's landlord after you dropped that he's
Speaker 1:your tenant. Effect on there. Alright. Thank you so much, Sam, for joining.
Speaker 2:Sounds good. Yeah.
Speaker 1:He could even say goodbye, just sound effect work. What you gonna say?
Speaker 6:What were
Speaker 2:you gonna say?
Speaker 4:Beep. Beep.
Speaker 1:Thank you so
Speaker 2:much, man. Sam. I'm I'm I'm excited for you and the team. And and keep
Speaker 1:us updated. I know there's big news coming, so drop it here first. Talk to you soon. Bye.
Speaker 2:Talk soon.
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Speaker 1:Fantastic. Well, we got Vincent Many times. From Prime Intellect coming in the studio next. We're talking about bunch of stuff related to crypto and AI GPU mining. I think this is gonna be a very interesting conversation.
Speaker 1:We talked well, welcome to the stream, Vincent. Love to hear. How are doing?
Speaker 2:There he is. Perfect. What's going on?
Speaker 1:We a couple months ago Yeah. Yeah. Thanks for joining. A couple months ago, we had Bridget from Founders Fund on, gave us the high level, overview, but I'd love to get it from you. Can you just introduce yourself and the company to kinda kick us off?
Speaker 7:Yes. So my name is Vincent. And, like, I'm the founder, like, co founder and CEO of Primatenelect. And, basically, our goal really is to commoditize AI and compute more broadly, really also by almost like networking all the computing world together and making sure, like, no GPU goes idle, but rather can contribute to almost like an interplanetary, like, compute cluster that can, like, fund, for example, source AI models, but also people can just, like, use to ultimately save on, like, compute. Like, ultimately, the goal really is realizing that, like, computers is, like, gigantic market which will ultimately power all of those different areas.
Speaker 7:And it's quite inefficient and very distributed. So a lot of it is ultimately, like, research challenges to make sure we can, like, network compute that is, like, quite distributed throughout the world, but also, like, verify it. Right? It's like you you can't trust, like, the thousands or, like, millions of different, like, data centers and, like, GPU nodes distributed across the world. There there's basically, like, a challenge to scale trust.
Speaker 7:It's like you can trust one data center or one company, but it's hard to do so at scale. So, basically, we're attacking those two problems.
Speaker 2:Okay. Why don't you talk about the launch Sunday? Yeah. You guys I hadn't seen I hadn't seen a launch like that on a Sunday since the last seemingly few Trump executive orders. You guys kind of realized Super Bowl Sunday.
Speaker 2:Yeah. Super Bowl Sunday. Why not launch a new model? But but break down the the launch just a couple days ago.
Speaker 7:Yes. So, basically, we, like, kind of like to take a step back almost, like, did this first very large scale distributed pre training run into, like, one, which was building on, like, DeepMind's distributed low communication training to train basically a model across the Internet, across multiple data centers in similar efficiency as in a centralized setting where we where all the computers network in one data center. And now that we switched to this kind of, like, o one, like, post training, like, reinforcement learning paradigm, It's actually kind of like a paradigm that is, like, perfectly set up for distributed training.
Speaker 8:Got it.
Speaker 7:Because most of it is, like, those roles, and, basically, you can distribute them extremely well. Like, there's basically less needs to communicate every training step. So what we did with, like, Intellect two was really scaling to, like, the larger model size, like, a 30 roughly 30 b model that we basically trained, distributed across the globe with different people contributing compute. And and we basically built this on top of Quen. So, basically, the goal was also to, like, take the best open models out there and improve them further for, like, actually quite, like, small amounts of compute.
Speaker 7:It was honestly, like, more like a proof of concept where we basically prove four different pieces. Like, on the one side, basically, we proved this, like, verifiable compute piece that basically anyone in the world could join with their compute. We don't need to trust them. It's very, like, efficient, basically, ways to, like, make sure that they're basically, like, an honest compute pro contributor. And then the other piece was really making, like, basically distributed reinforcement learning work.
Speaker 7:So basically decoupling those, like, role generations from the training itself. So you basically can train across the globe with, like, less frequency of communication. And what we basically prove is that, like, with quite a little small amount of compute, roughly a hundred thousand dollars, which is not comparable to, obviously, kind of, like, the more, like, close AGI labs, we've basically been able to, like, improve upon GWENT. And it's kind of, like, sets the foundation for us to actually scale this much further and ultimately, actually, have kind of, like, a repeatable recipe to get like, basically improve, like, the strongest open source models out there continuously for quite, like, small amounts of capital across different domains. So we made it much better on math and coding, But the goal is also to make it much better on, like, other domains.
Speaker 7:And really, like, how to do so is, like, really scaling those, like, reinforcement learning environments. I think you had Will Brown on. Like, he joined us to work on this.
Speaker 2:Yeah. I was gonna ask. What was what was the what was the process like recruiting the big dog, WB?
Speaker 1:Absolute dog.
Speaker 2:I mean, I I just have to imagine. He's such a good poster. He's such a a great guy to chat with. I I he could've gone anywhere, but he ended up with you guys.
Speaker 7:Yeah. I think it's it's two things. Like, you you should ask him what's up, but I think, like, a lot of talent is gravitating more towards, like, open source AGI and, like, to basically build in the open to publish in the open. Right? Like, to be able to also, like, contribute to the frontier of, like, the most exciting research.
Speaker 7:And in a sense, like, I have friends at OpenAI and who's never heard because they can't publish, don't really talk about their work. Right? So, like, I think there's there's this component, but I think then we are basically, I think, like now, like, especially in the Western Hemisphere, I think, like, one of the only places that is really catching up to the frontier. Right? Like, there's obviously, like, Kuan and DeepSeek and and others in China, but I think it's really a fumble by, like, America, I think, to basically be the close guy that is, like, not really almost like standing in for the values of, like, democracy and freedom to the same extent.
Speaker 7:But I think, like, he he's obviously extremely passionate about, like, open source AGI and kind of, like, distributed, like, reinforcement learning. So, like, he immediately hit the ground running on on basically scaling this much further. So we'll have more, like, yeah, like, work we are building on top of, like, this direct chunk distributed reinforcement learning, like, in the next few months already out, which should, like, scale this much further.
Speaker 1:Mhmm. Remember a couple of years ago, I was using OctaneRendr, and they have a distributed rendering network where you can render CGI images on GPUs all over the world, and they actually have a a a crypto layer, for render tokens as well. But this idea of distributed computation makes a ton of sense in that context because each frame is unrelated to the other frame. So you can if you're rendering a 90 frame sequence that's a few seconds long, you can just send, you know, each frame to a different machine. What have you learned from the successes and failures of the render network and what Otoi did with Octane?
Speaker 1:And and is there any difference between those discrete individual frame generation and something as complex as training a whole model where, you know, you might you in theory, you'd need to load it all into one one instance every single time.
Speaker 7:Yeah. Like, great question. I think there's a few players like them and others that have tried this in the past, and I think they've been almost, like, in some ways, I think, too narrow and, like, shown ambitious. Right? It's, rendering, like, it's nice, but, like, it's not, like, the general purpose, like Yep.
Speaker 7:Like, use case that we now have with AI. Right? So I think there's basically like, with our goal is really making this much more, like, general purpose useful for, like, every single, like, computer AI use case. Mhmm. And I think that has been one big learning.
Speaker 7:It's basically being, like, most of our team are AI researchers, and they come from the AI world Mhmm. Including the people that built, for example, the verification mechanisms. Right? Like, the verification, in our case, has, like, tiny OVAD, like, 1%. Like, the more, like, crypto native verification mechanisms have more, like, a one to 10 x OVAD, which then make it completely, like, unfeasible to compete with other centralized clusters.
Speaker 7:So I think that has been, like, a big learning. It's basically being very pragmatic and close to the AI researchers. So that's, like, the main community we're, like, building with and engaging with and basically building for. Right? So, like, all of our users are AI developers.
Speaker 7:And, ultimately, I think the biggest lesson has been is, like, just creating value for for them from day one. Right? It's like we launched basically our compute platform, like, two or three months in with, like, two or three people and and immediately got, like, a lot of users and scaled since then. Like, basically, that, like, any kind of, like, AI startup or developer can just, like, basically, with our platform, almost like like, have, like, a global market on the one side. Right?
Speaker 7:Like, we we aggregate all the hyperscalers, all the different data centers. I'm working with, like, folks like Aaron, like, later on from high Hydro. Like Nice. And all these guys to basically aggregate and orchestrate, like, all these different data centers and hyperscalers. And I think that has been another lesson.
Speaker 7:Like, we are not trying to be, like, the exclusive maybe marketplace where supply onboards. We just aggregated all the supply out there, which gave us a huge kind of, like, wedge maybe to, like, enter the market.
Speaker 1:Okay. Talk about some of the hardware where this is actually running a 30,000,000,000 parameter model. At at floating point 16, you're gonna need 60 gigs of ram ram. You're probably gonna be on h 100, not gaming cards. But, are you thinking about bringing, residual cape capacity online in the gaming market, or are these, like, small data center operators that just have a stack of h one hundreds that are not using and then they're bringing them online?
Speaker 7:Yes. So, basically, I think what's been exciting is, like, actually, this run was heterogeneous. So h one hundreds and a one hundreds could join. And I think
Speaker 8:it may
Speaker 7:be even, like, h hundreds. And, like, for future ones like, actually, for next one, we're starting, like, even thirty nineties and and, like, gamer cards can join. And I think what's interesting is you can basically with, like, this role role generation and, like, basically synthetic data generation, you can distribute the tasks, like, basically based on their, like, difficulty to different cards, right, and to different models. So the goal really is, like, to have, like, full tolerant, like, heterogeneous, like, pool of compute. Right?
Speaker 7:So, like, what's also a big one that we did already in the first run, but also in this one, is is full tolerance. So it's not only that you have, like, h one hundreds joining and a one hundreds and 30 nineties, but they can also drop out. Right? Like, they can join for a few hours when they idle. And I think that's, like, the barter thesis.
Speaker 7:It's, like, almost, like, every GPU that is, like, idling is, a market failure. Right? Like, especially in a world where increasingly like, my theory is, like, the the biggest, almost like, commodity in the world will be compute, and, like, it will be one of, like, one of the biggest slices of GDP. And it's, like, unfortunate if, like, half of that is, like, sitting idle instead of, like, curing diseases, generating, like, movies or, like, some like, creating, basically, technological progress. Right?
Speaker 7:And I think the goal is to basically just get to like a % utilization of compute, and we're very, very far from that.
Speaker 1:Yeah. Yeah. What what are you seeing in like the trend in chip size and scale? You know, obviously, NVIDIA is pushing pushing those, like, DJX, DGX, like rack mounted units, racking everything together with NVLink, so you can do even bigger models. Cerberus is scaling up the single chip size to wafer scale.
Speaker 1:The the the theme of the last few years seems to have been, let's not decentralize. Let's actually centralize further. And so, where does this go? What is your take on on kind of the ever bigger racks and ever bigger chips for larger compute training?
Speaker 7:Yeah. I think we'll see both. And I think, actually, ironically, like, an NVIDIA actually has an incentive to fragment the market. Like, they don't want one buyer. They don't want AWS to be their only customer because AWS is building their own chips or, like like, the big tech clouds, basically, like, have their own chips competing with NVIDIA.
Speaker 7:Right? So NVIDIA is very happy to give a bunch of chips to Corey, a bunch of chips to Cruise, a bunch of chips to Lambda, and all of these other guys. Right? But then so I think we'll see both at the same time. Like, I think, like, the all like, we'll have thousands and, like, millions probably over the next few years, like, of data centers.
Speaker 7:There will be these gigantic clusters, right, like Stargate from OpenAI. But I think at the same time, like, there's increasing amount of, like, capacity in in the almost like the mid tier of, like, smaller data centers. But then I think, like, also on the other side, like, there's a lot of compute, like, sitting idle everywhere. Right? Like, soon, whatever, like, autonomous cars, robots, like, everything else.
Speaker 7:So actually had, like, some of the biggest, like, car companies in the world reach out to us or phone manufacturers that they're like, oh, we're sitting on, like, hundreds of millions, like, billions of, like, phones or cars that are, like, have other compute capacity. And I think we're not there yet, but I think we'll we'll have, like, we'll have just much more compute everywhere. Right? Like, we'll have more, like, mega clusters, but we'll also have, like, more mid tier and small clusters.
Speaker 2:Mega clusters. Mega clusters. I have a question before you leave. Can you can you give us some any expectations around DeepSeek r two? I've seen some crazy rumors flying around online.
Speaker 2:I don't know what's what's real and what's fake news, information warfare. Curious what you're expecting out of the next release.
Speaker 7:Yes. Like, I think they'll they'll definitely catch up to the frontier. Like, again, I think to some extent, I think they'll they'll probably be not as good, would be my guess, as like Gemini or OpenAI. And but I think there's obviously this trend where I think, like and and all the closed lab CEOs have admitted it. Right?
Speaker 7:It's like that open source has catch up, like, very uncomfortably close to their lead. And I think that will continue. I think the the the closed guys obviously have some advantages, but I think there's also huge advantages, obviously, the open source AGI space has. So I think Mhmm. Like, trend will continue that ultimately, like, the DeepSeaks and the Crimes of the World, but hopefully also, like, players like Llama will, like, catch up a bit more.
Speaker 7:Like, obviously, they've been bit disappointing with their, like, Llama four launch, but I think they might also actually, like, catch up again. And and then, obviously, I think, like, our goal is, like, to be able to basically build on all of these on all of that progress. Right? It's like, basically, we kicked off our, like, largest synthetic data generation run the day DeepSeek dropped and, like, generated basically a lot of, like, verifiable, like, reasoning data that we could then use, for example, in this recent model. So I think the the like, what I what I see more is, like, basically, we can, like, improve open source AI progress, like, literally day by day, week by week.
Speaker 7:Like, it won't be a thing where we need to wait, like, four months for, like, some progress to come. But it's more, like, continuous, basically, progress.
Speaker 1:Well, thank you so much for joining. This was a fantastic conversation.
Speaker 2:Yeah. I really enjoyed this. And congrats on scooping Yeah. WB. Man, legend.
Speaker 1:It's really truly.
Speaker 2:Truly legendary legendary. Yeah. We're But come back on again soon. Know you guys are gonna have a bunch of launches coming up, and appreciated your per perspective.
Speaker 1:We'll talk to you soon.
Speaker 7:Appreciate it.
Speaker 1:And if you're looking for distributed compute, go to Prime Intellect. If you're looking for distributed advertising, go to Adquick.com. 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, data to enable efficient, seamless ad buying across the globe.
Speaker 2:They just make it too
Speaker 1:easy, John.
Speaker 2:I wanna spend every single dollar we have
Speaker 1:on Adquick billboards. Anyway, we got the CEO of Backbone in the studio. Let's bring him in, Manit. Excited to have you here. Welcome to the stream.
Speaker 1:How are doing?
Speaker 5:Thanks for having me. Appreciate it. I feel like I walked into the middle of an ad read.
Speaker 1:You did. You
Speaker 4:did. You did.
Speaker 1:We are 100% corporate sponsored. In independent media is dead. The future is corporate media, and we are leading the charge. But good to have you here. Can you introduce yourself and explain what Backbone is?
Speaker 1:I'm a fan, but some people might not be aware.
Speaker 5:Sure. My name is Manif. I'm the CEO and founder of Backbone. Backbone is the leading platform for the future of gaming.
Speaker 1:Mhmm.
Speaker 5:The way I describe it to people is that every time there's been a shift in streaming media, it's resulted in some of the biggest consumer businesses. So, like, music streaming, you had Spotify and Sonos. And then in TV streaming, you had Netflix and Roku. And you can think of Backbone as the analog company for streaming games. We have a number of products.
Speaker 5:We sell devices that you can use to connect to your phone or any screen and play games on them. And then we also make an app that aggregates all of the different streaming services like Xbox Game Pass and others, so you can access them all in one place. You can buy our products in any major retail store, Walmart, Target, Best Buy, etcetera. And we're backed by investors like Index Cool. And Sound Ventures.
Speaker 1:Yeah. I got one a couple years ago. I was not getting a lot of time in front of the PlayStation five, and so I would drop my phone into the Backbone and stream from the PS five over the Wi Fi to the phone with the Backbone. It gives you the whole whole gaming experience. Very fun.
Speaker 1:What has the relationship been like with the the big console providers? Can you break us down the different strategies? It seems like, Sony has been very competitive launching something that's kind of like a competitor with the PlayStation I forget what they called it, but the it it has a screen and and device and does remote play. Microsoft's taken a much more open, approach, letting you even stream Xbox games on PS five, and Thorza Horizon is on on PlayStation now. And so, what what has been the relationship with the different major gaming platforms been like over the last few years?
Speaker 9:For sure.
Speaker 6:So I think,
Speaker 5:of course, each one has its own strategy. Microsoft in particular is really interesting because they're running this campaign now called Xbox Everywhere Yeah. Where the idea is that you can turn any device in your life into an Xbox and run games on any screen. And the way they're doing this is through streaming games from the cloud. So Microsoft's subscription service Game Pass, if you subscribe to it, you can basically access the entire Xbox games catalog, on any device that you own.
Speaker 5:And, of course, the devices and software that we're making, work great with Game Pass and make the experience work really well in to end so you can do it on things like smartphones.
Speaker 4:Mhmm.
Speaker 5:So I think in Microsoft's case, you know, their goal is really to drive more Game Pass subscriptions and just gather more MAU and GAL for their service. Yeah. And it's super strategic to, you know, their overall road map with cloud and all that as well.
Speaker 1:Why wasn't Google able to pull it off? I feel like they were early to that party, game streaming. I can't even remember the name of the product, but it never really hit, like, major takeoff. Or do I have it all wrong? And, actually, it's better than ever.
Speaker 1:I don't even remember.
Speaker 5:So you're talking about Stadia?
Speaker 1:Yeah. That's right. Stadia.
Speaker 4:Yeah. Yeah.
Speaker 1:Is Stadia still around? What's that? Is it still around?
Speaker 5:No. No. It was Okay. Unfortunately.
Speaker 1:Classic Google. Classic. But but but, mean I mean, you would think they have all the resources. They're hyperscaler. They have GPUs in the cloud.
Speaker 1:They can do rendering. And they're also somewhat platform agnostic, so any game developer could go to Stadia. It just seems like super additive. I'm sure you had intimate interactions with them as Stadia as you were building the company. What do you why do you think Stadia didn't take off?
Speaker 5:For sure. So I was at I was at Google when they were working on it.
Speaker 9:That's why
Speaker 5:that's actually was was sort of part of the basis for the idea. Yeah. I went into the office one day, and there was a demo that an engineer had built where you could use Google's cloud technology to stream games to, like, basically, a two generations old Android phone. So you read Wow. GTA on, like, a two generations old Android phone.
Speaker 5:Yeah. And I picked up this demo, and I tried it, and I completely lost my mind. I was like, we've seen disruptions in gaming across every single vertical. Right? Yeah.
Speaker 5:Business model, audio, content. But this has gotta be the single biggest disruption in the history of the games industry, at least that I'm aware of, in a long time. And so kinda became the basis for the idea behind Backbone. I basically made, a slide deck on why I thought it would be, like, a really big opportunity for Google. Yeah.
Speaker 5:And I sent it to the head of product for YouTube gaming, and then I realized it could go a bit wider. So I sent it to a bunch of the vice presidents internally.
Speaker 1:Cool.
Speaker 5:And, basically, a bunch of people ended up reading it, and it became one of the most viral slide decks internally in the company. Like, 15% of the company read it by my last day. And so I gotta meet with some of the executives that are working on Stadia and other initiatives. I think there's no doubt that this technology was incredible. Yeah.
Speaker 5:But I think other players like Microsoft just had a better go to market strategy and more content.
Speaker 1:Yeah. That makes sense. I mean, the content's really, really key.
Speaker 2:Switching gears a little bit, how have you seen the industry react to the news last week around the App Store sort of payment policies? I imagine you've been hearing a bunch of chatter.
Speaker 5:Yeah. I mean, certainly, if Fortnite were to return, the App Store would be pretty big. I think it's been like It's
Speaker 2:under it's it it was sub it was resubmitted. Right?
Speaker 1:Hasn't been approved yet. Normally, Apple approves in 90% of apps get approved in twenty four hours. We're on, like, hour forty six. So everyone's saying, Apple, what's going on? You're dragging your feet anyway.
Speaker 5:Yeah. I mean, I think it's huge. I mean, it means that if you're able to link out to external payment systems, you're basically gonna be able to take in more margin as a game developer. And, I think it'll,
Speaker 9:you know
Speaker 2:But how do you expect how do you expect users to actually respond? Right? So, like, let's say you download a free game, and you're like, okay. I wanna pay I'm willing to pay for this game. And you get the option to just subscribe in the app.
Speaker 2:Maybe it's at one price or subscribe outside of the app at a lower price. Right? You'd have to offer I imagine have to offer some type of incentive to get somebody to want Right. To go to a separate web page. Right?
Speaker 2:So I can go outside of the app and I get maybe some Instead of
Speaker 1:30%. Yeah. So you're splitting the difference.
Speaker 2:It's 15%. Kind of, but then I imagine some users like the fact that their subscriptions are native and they could go into the App Store and and churn if they're not using something. And so how how do you expect that? How do you expect developers to actually play it? Do you and and do you think it's are they really getting back 30%, or is it more like, you know, again, splitting the difference?
Speaker 5:So I think what we're seeing right now and in in Epic's implementation, they posted a tweet online, like, RevenueCat CEO replied to Tim Sweeney's tweet, and he was asking, like, how did you implement this? Did you use in app purchase?
Speaker 6:Mhmm.
Speaker 5:So in Fortnite's case, they show an option to do in app purchase, and they also show, you know, the web flow through Stripe or whatever. And that one is, you know, a 20% kind of cashback or something like that. You get, like, 20% back in epic credits.
Speaker 6:Oh, yeah. Smart.
Speaker 10:There we go.
Speaker 5:So there's, like, an incentive. You people might have to incentivize customers to transact through the web, and that will
Speaker 2:But giving them back in credits free credits Super smart. Points in the game, which they're gonna value on a cash basis.
Speaker 1:Right. Tim's not actually. Dog. You
Speaker 2:know? What a dog.
Speaker 1:I I wanna talk about the the actual technology road map or tech tree to make mobile gaming even better? What's more important? Better devices, faster chips, more memory, better screens, or just ubiquitous five g, Starlink, better connectivity, lower latency. Because, Call of Duty, you can stream it on your phone. Probably Xbox, Xbox Game Pass allows you to do that.
Speaker 1:There's still a Call of Duty mobile that's optimized for the phone, and I think people probably play that one more on their phone than the streamed one. And so we're still not in this fully streaming era. What are the what are the blockers to get us to just one installation of the game everywhere?
Speaker 5:So, I mean, both of those things are bottlenecks. And we we often used to get in these, like, furious debates internally over, like, which one was gonna overtake the other. And then we kind of realized after a while it was a bit aimless because we just want the overall basket to succeed. Mhmm. And I think you'll see a lot of, like, hybridization where you'll have, you know, games that are relatively, like, thin clients, but, like, a very significant cloud component to them.
Speaker 5:Versus right now, we think of this dichotomy of, like, fully streamed versus native.
Speaker 1:That's interesting.
Speaker 5:Think maybe there'll be, some games that float across the boundary line. I mean, Fortnite is one such example of that where, there's a pretty heavy cloud component to the to the game.
Speaker 1:What are you playing right now?
Speaker 5:Right now? So I don't know if you've heard about Expedition 33.
Speaker 1:Oh, yeah. I haven't played it yet. Heard about it.
Speaker 5:I'm just about to get into that.
Speaker 1:Okay.
Speaker 5:That's been popping off on the Internet. Yeah. I've been playing a lot of Fortnite.
Speaker 1:Yeah. Yeah. Looks good.
Speaker 2:Anything else for you? Were you what were you surprised about the GTA six release date? It seemed like the market had been pricing in a 2025 release, and then all of a sudden it was like, nope. 2026.
Speaker 5:I mean, it takes these games take forever now. The production costs of there's some really great articles, online talking about, like, how the development costs for these titles have ballooned because of, like, this need to have really lifelike graphics and realistic gameplay. So not surprising. No.
Speaker 1:What about tariffs? I imagine that that was a tumultuous time for you. K. Obviously, sigh of relief recently, but what's your outlook, and what did it mean? Take me through the the emotional journey of the last couple weeks of the company.
Speaker 5:Yeah. I mean, definitely short term painful. It was awkward timing given given the Backbone Pro launch, which just occurred this past week.
Speaker 1:Sure.
Speaker 5:And this is a huge launch for us. I mean, we generated, I think, around 700,000,000 media impressions
Speaker 1:Mhmm.
Speaker 5:Which is more than, you know, Beats and Aura and Sonos generated for recent product launches. Wow. And so it was a big launch, and it was an awkward time because of the tariffs that made the pricing strategy a bit complicated. Mhmm. That being said, we think in the long run, anything that promotes, you know, free trade or reduces tariffs, like, globally is beneficial to the company because then we can offer our products in more markets than we do today at, you know, more of a fair price to consumers.
Speaker 1:Yeah. I gotta pick up a Backbone Pro. I'm looking at it right now. I'm adding it to cart.
Speaker 2:John has always said the biggest risk to the show is that he just gets sucked into some some
Speaker 1:It's it's like my one vice. Like, you'll never find me, like, passed out drunk, but you will find me, like, seventy hours into, like, Metal Gear Solid for the third time. Anyway, this is fantastic. Anything else
Speaker 2:for you? No. I'm happy for for you and the team that you get a little relief on the tariffs. Congratulations. Congrats on the new launch.
Speaker 2:Good luck. I know you guys are shipping in about a week now. So Excited a lot of work to get to that point.
Speaker 1:Head over to backbone.com. Pick one up if you're a gamer. Check it out. Anything else?
Speaker 5:That's all.
Speaker 9:Thank you.
Speaker 1:We'll talk to you soon. Great. Have a great day.
Speaker 2:Cheers.
Speaker 1:Bye. Speaking of sleeping easier, post tariffs, Eight Sleep. Go to Eight Sleep dot com. Five year warranty, thirty night risk free trial, free returns, free shipping, pod four ultra. I got an 88 last night, seven hours and eleven minutes.
Speaker 1:Not too bad. What'd you do, Jordy? Did I beat you, or did you smoke me? A hundred. A hundred.
Speaker 1:He knows Brian Johnson's coming on the show. He's prepping.
Speaker 2:Proof of work.
Speaker 1:He's prepping. Anyway, we have our next guest coming in
Speaker 2:Put put it up. Put it up. 100. See? It's not a screenshot.
Speaker 2:I'm moving it around.
Speaker 1:There you go.
Speaker 2:There we go.
Speaker 1:Yeah. The new app is beautiful. Go download it. Anyway, folks, we got Aaron Ginn coming in, breaking down a new, Wall Street Journal article he Aaron, how are you doing?
Speaker 2:He's back.
Speaker 9:Yeah. Doing well, man. Can you put on those sunglasses, Jordy? I can't recognize if you know them.
Speaker 2:Yeah. Yeah. Yeah. These ones? These ones?
Speaker 3:Where are mine?
Speaker 2:The pit vipers? Unfortunately so so there's some crypto there's some crypto coin that that people are using PitVipers to promote. So we gotta be careful putting it on. Careful, but they
Speaker 4:do look great.
Speaker 2:But they were sent to us from a From
Speaker 8:the CEO,
Speaker 1:I think.
Speaker 2:From the CEO of PitViper. He's just like Stevie PN. He said, have some PitVipers.
Speaker 1:Pretty cool that they, like, rotate up and down like this. Yeah. I've never actually worn any of these.
Speaker 2:I've worn them. No. Anyways, it's great. It's great to have you on.
Speaker 1:Always great.
Speaker 2:The Prime Intellect CEO was on earlier, and he said that you guys are working on some stuff together, which is cool.
Speaker 9:Yeah. Yeah. Yeah. Yeah. Like, they're handling the higher level, like, training layer if we're doing the underlying infrastructure, distributed layer.
Speaker 9:But they yeah. Like, going back to about the, op ed that I wrote, I've been, more or less battling slash encouraging the administration to take a more reasonable approach to the threats that Huawei has against our dominance on AI. Mhmm. And, when the, I met and know the people who under the administration that wrote the January 15 ruling that we don't really know, by the way, like, what's gonna happen. We just heard rumors that things are gonna change and they're gonna be more positive towards Jensen and and NVIDIA.
Speaker 9:But generally speaking, they wrote this kind of the the precursor framework that people didn't understand is it created a g 18 of AI countries, which included, like, Japan, South Korea, Taiwan, America, Canada, and some European countries, about half of Europe. And the original Biden ruling Mhmm. Right, these are bureaucrats. Like, there's not there's no it's not it's very vague law area, like, on their governance. They're basically operating under nineteen eighties missile technology proliferation, law that was written back whenever we had Soviet Union.
Speaker 9:But but so they got a regulator that, and the Biden administration, you know, couple days before they're leaving, decided that they would create this kinda g 18, of countries and then a hundred ish other countries that were gonna be basically prohibited or require license. And then, you know, absolutely no good countries, car tier tier three. The tier three countries are quite logical. Right? They're like Libya.
Speaker 9:You You know? Yeah. Venezuela. Yeah. Right?
Speaker 9:It's like, oh, okay. This makes sense. But if your two countries require license was, like, Greenland, Portugal Mhmm. You know, Switzerland, Austria. Right?
Speaker 9:All of Eastern Europe was on the crap list. All, you know, the president's right now, and Jensen's in the Gulf Region, all of that was on the crap list. And then, like, kind
Speaker 4:of re
Speaker 9:random countries, Mexico. Mexico makes all of our servers. Mhmm. And the original kind of premise around this was regulating cheap power, so it was mostly anticompetitive. They they didn't believe that Mexico got GPUs or it in China.
Speaker 9:They they just thought, oh, they have cheap power, so we should just, you know, say, oh, that's bad for America. And and so I've been advocating for this kinda idea of, like, this new Monroe doctrine of thinking that, AI is more of a forward operating base for America due to the neocons and neoliberals. We have over 300 operating forward operating bases of the world Mhmm. Where our special forces are, you know, active and doing things that they don't tell us. And so I basically have been trying to, like, kind of, you know, think about the AI as kind of something similar, where the every deployment that is an American deployment is real estate that we own.
Speaker 9:Mhmm. And that running the the world glow growing like, growing on our infrastructure is better than growing on Chinese infrastructure. Mhmm. And it's either or. And I think that under the Biden administration, there was this view that they couldn't do anything.
Speaker 9:Like, oh, they just make iPhones. They're not to be overly trite, but they I think they had a kind of a less view of where it's kinda was.
Speaker 2:Mhmm.
Speaker 9:And as the data came out with, more and more advancement on the Ascend line under Huawei, more advancement under, Deep Sea Gidmanis, it became very much clear that this actually was a race, and that they were significantly closer than we thought. And so the goal then is proliferation, and that's essentially what the Trump administration, the congress department announced, last week was that they're gonna embrace a trusted proliferation model, which is what I've been advocating for of this poor deployment of NVIDIA gear running on an infrastructure or running on our frameworks because it's either us or them. Either world uses dollars or uses something else. Like, there there's not this kind of secular world where trade happens and it doesn't include a country. It involves us or involves somebody else.
Speaker 9:And and that's becoming more socialized and more accepted. Mhmm. And so now they're trying to think of other ways to try to manage proliferation. Tom Cotton introduced a bill to GP track GPUs. Not very bullish on that, but, you know, like, there there are other ways, you know, people are trying to think about doing this rather than just saying, hey, Portugal, you have good beaches, but no GPUs for you.
Speaker 9:Saudi Arabia, we can sell you f 30 fives. We can sell you even, you know, ICBMs with no nukes on it. But, hey, you can't get the Blackwell series. That's too risky for for us to do for you. So it's a so there's a great resetting that's happening.
Speaker 9:It's good for America.
Speaker 1:Yeah. Yeah. What what is your take on the recent, Saudi Arabia deal? 18,000 NVIDIA Blackwell chips going in.
Speaker 2:With with hundreds of thousands
Speaker 1:With hundreds of thousands on the way. It seems like it's an affirmation of everything you've been saying. But what's your interpretation?
Speaker 9:Yeah. Like, I I I think it it's one way Huawei's already deployed there. So I think that that was a wake up call, and there's also a a ton of Chinese, cloud companies that are doing deployments in the Gulf Region. But, you know, it's it's positive because it's again, it's it you have to realize that people are gonna get this regardless. So another good framework is because this is all, like, leading edge stuff, and people get confused about what's actually happening.
Speaker 9:They also overly express our our actual dominance on a particular area. But but think of it as, like, a MIG platform versus Lockheed or Boeing. Like, you're not gonna tell a country, hey. You just can't have a fighter jet. They're like, we're gonna go get some mix.
Speaker 9:Mhmm. Right? We're gonna go get some I forgot the ring of the French one. Right? That that drops, know, baguettes from the airplane.
Speaker 9:Right? Whatever that French plan right? Whatever that that one is. Right? It, like, I forgot the name of it.
Speaker 9:But the the so so it's it's like that. It's like it's like it's it's an either or question. Yeah. So we either have a decision to engage with the country or not, and then if they don't, they're gonna go somewhere else. Mhmm.
Speaker 9:And with Saudi Arabia, which is a very clear ally of ours, very clear ally of Israel, the leader in the region with Israel, I we have to be in a position of they understand this. Like like, the the Gulf Region kinda gets real estate and put crap in the in the building. They kinda like, they understand that. Right? And and so it's something they can feel they can be very successful in.
Speaker 9:And as well as it gets to come to the the, you know, the Jeddah Tower, Burj Khalifa thing of, like, we're ahead, we're winning the line. Right? Like, all these, like, crazy projects that won't happen until,
Speaker 2:you know, say, centers but but our data center, you know and, obviously, Saudi will have fantastic partners in NVIDIA, and I'm sure many other hyperscalers for their new AI factories. That's the new aim. We gotta stop saying data center. It's AI factories.
Speaker 9:Yeah. Tokens.
Speaker 2:But We'll love some But but yeah, isn't isn't this not is it is it is it correct to call it real estate today, or is it something else?
Speaker 9:Well well, I I think the dynamics behave like real estate. Like, that's how the actual investors think of
Speaker 2:how they get financed. The execution is different.
Speaker 9:Mhmm. Yeah. Yeah. So so I but, like, the way that this flows out, what I believe, is what, like, the premise of our model, why we're a part of, like, over about almost a dozen sovereign sovereign projects. We're kind of the for for NVIDIA, they they advertise us to a lot of their growing data centers internationally as Hydra is the best software AI go to market, provider in the world.
Speaker 9:So, like, we're really, really good at this. And and our operating model is is much more I think I mentioned this last time, that think of it as, like, the airlines industry, that that the the commercialization of AI is really resides in the platform, and that platform is Jensen. It's not anybody else. It's Jensen. And and and that's just like Boeing.
Speaker 9:And you have these kind of, like, rare birds that that are coming out, which is OpenAI, but the the technology model on OpenAI as we come knowingly accept is relatively commoditizable. So its real value is the brand. It's it's the accidental consumer product company, as Ben Thompson likes to say.
Speaker 1:Yep.
Speaker 9:So when you have the commercialization happening at the platform hardware layer like Boeing, you create lots of billion dollar companies, you know, American Airlines, etcetera, Emirates, whatever. But you don't really have this parabolic power law outcome like you had with software defined notes, like Google or Airbnb or Twitter or something to that effect. So when you have a world that works like that, Jensen becomes the play. Jensen is the platform. You can still create lots of different successful companies that are very large, but I I'm very skeptical you're gonna see this huge outlier into the stratosphere like we saw with other software defined modes.
Speaker 9:Rather, it looks more like airlines industry where there's lots of very successful people, lots of very successful, you know, winners, but there's no clear category leader. There's no clear, like, so far ahead that nobody nobody kind of will ever touch it because the fundamental product is a product that gets deployed in a data center, that gets run and commercialized and all the value is created there, and everything else just kinda plugs into it.
Speaker 1:It's like fastest way to become a millionaire. Start as a billionaire and buy an airline. Yeah. And and you
Speaker 6:want a lot of want buy
Speaker 1:Yeah. A millionaire? This is a famous thing because, like, yeah, the value doesn't really accrue to the airlines in the way that it does to consumer tech companies, of course.
Speaker 5:Yes.
Speaker 1:I wanna talk more about, this this idea that, like, it is valuable to America to have, foreign AI models running on American infrastructure. And maybe we could go back to the f 35. If we send an f 35 over to another country, they have the ability to use that however they want. We don't really have control over that. We don't necessarily have a kill switch.
Speaker 1:Yeah. Obviously, it's good economically because we sold it to them. We get some money. That's nice. But, is there is there is there some downstream benefit to well, now we're really allied with you because, yeah, we sold you the planes, but you're still gonna have to remain friendly with us as we resupply and send you more screws and bolts to to to maintain these planes.
Speaker 1:Is there a similar analogy in AI factories or data centers where, sure, yeah, you bought 18,000 NVIDIA Blackwells, but if you don't keep working with us, those are gonna die. You're gonna need to replace stuff, and you need to keep us an ally. Is that the goal?
Speaker 9:Yeah. Like, that that's my goal because I I believe America should win. Don't I don't believe in a multi polar world. Mhmm. I believe in a new Monroe Doctor, and I believe that we should re shore to The Americas.
Speaker 9:Mhmm. And and some of that will be here, some of that will be in Mexico, some of that will be in El Salvador. We're already, you know, monetizing El Salvador with prisoners. So, like, why not then make fiber optic cables? Why don't they make fans?
Speaker 9:Why don't they, like, for in the in the service supply chain? Or textiles. Like, Mexico is the cheapest place for us to manufacture. It's been that way for over a decade, but they don't have the technical capability to do it, which is why you don't see that there. Mhmm.
Speaker 9:But but in the new Monroe doctrine, my my thesis is that we reshore critical things to The Americas, and then we have these we have these external allies that reinforce that, just like the old Monroe Doctrine was Americas, and we had Britain that enforced it and with us. And so the same thing goes with the ring of fire from South Korea down to Singapore. That becomes our allies in that region. We ship America goods there. They become America enclaves, but they're relatively sovereign.
Speaker 9:They're they're they're their own identity and their own military. And and partnerships like that not only advance, you know, like you said, like, sell goods, like, there's announcement with the Boeing. Like, I mean, they already bought Boeing. Like, it so it wasn't if both Riyadh Air and Saadia believe they're they're Boeing platforms. They don't they don't have as many Airbuses out there.
Speaker 9:Because Airbus has a is a just so you know, like, the this will be our technical thing, their engine design is not really compatible with sand that well. So that's why they they prefer belly because it's more adaptable to high heat. Mhmm. So, like, either way, like, that that's an advantage to us because it's a form of soft power that we can allow the proliferation of not only safety for Americans globally, but it makes us rich. Like, trade is American.
Speaker 9:It's not secular. It's not something that just happens. Like, if we define it, the dollar is a platform. Trade is us. We define we do we rule the open the oceans because we say that it's important for us to trade.
Speaker 9:So I got there's kind of, like, this weird thing happening on the right that there's, like, these two types of, like, China hawks. There's, like, OG China hawks, which is like me, who believe that the way you beat China is you win. Then there's this new China hawks, which are, like, protectionist, semi socialist, and wanna withdraw from the world. They believe in a multi world. Mhmm.
Speaker 9:And and they kind of crept in, but they're actually a little they're more on the left side of the spectrum. And the tariffs and, kinda attitudes around NVIDIA, you that's when you hear these things of, like, we shouldn't sell. The world, like, kinda can wait on us, or we don't need their goods. We shouldn't trade. Versus the original OG China Hawks were like, no.
Speaker 9:We should trade. Trade is peaceful. It's great. It de it decompresses issues between countries, but it doesn't mean we give away the farm. It just means that we rebalance and we make it fair.
Speaker 9:And and it was kind of this hot minute where, like, these, like, new neotronics got in charge and started doing these kind of crazy things with terrorists where we had no idea what was going on. Like, believing that terrorists make us rich is one of the most profoundly illiterate things, like, I've ever heard from you know, I've my background's an economist, but they like, it's it's literally stupid. The places that have highest air force in the world are absolutely poor. Yeah. And the places that make tech
Speaker 2:out external revenue service.
Speaker 9:No. Like, I Again, I'm I'm pro that. Right? And they because I don't
Speaker 2:wanna pay taxes. But, hey. Taxes are a theft. Right?
Speaker 9:So the the the but I'm I'm willing to engage in some type of thievery if it means that I'm safe when I go to I just came back from Belize, but I'm safe when I go to Belize. I'm okay. I'm okay I'm okay engaging that. But but America only wins when we have this peaceful economic transaction that occurs in countries that want to adopt more pro Western frameworks.
Speaker 2:Mhmm.
Speaker 9:We should support that because when the world becomes more West, it becomes safer, it becomes more prosperous, people have rights.
Speaker 2:We had Sam, from Impulse Stoves on on earlier, and he was saying that free trade is almost becoming a a liberal policy. Yeah. You know? It's a liberal position now to just be, like, free trade, you know, just because as from a reactionary standpoint. I'm curious if you're what you're expecting out of the Qatar visit, which I believe is happening in the next forty eight hours.
Speaker 9:Yeah. Like, was, like, Cutter we've we've already been talking to the Royal family there. Like, they they definitely wanna get in GPUs. They're they're have you ever been to Cutter, by the way?
Speaker 2:It's so it's you have you have?
Speaker 1:Yeah. Briefly.
Speaker 9:It's it's absolutely bizarre. It's a imagine, like, the largest country club in the world as a country, and there's, like everything is clean and well done, but, like, in the street and you're walking, it's mostly just, like, servants. There's, like, no people. It's, like, it's it's very weird. And they have so much money.
Speaker 9:It's it's it's they they they even build, like, up with the cutteries. Right? There's only, I think, 300,000 total citizens, and the total number of, like, the broader servant class is, like, around 3,000,000 Mhmm. In the actual city. But they're so wealthy.
Speaker 9:They have they they do these, you know, sand dune thing
Speaker 1:Yeah.
Speaker 9:Which I went to go do. And they build these homes in the middle of the desert, like, massive camps. And they just, like, have these hundred thousand dollar they're just going up and down sand dunes all over the place, right, and there's, like, these huge encampments. They have so much money.
Speaker 1:It's awesome.
Speaker 9:And they're they're trying to get into Yeah. Power and energy as well as the data centers, but that but there's a there's a tricky problem, which is that they have a habit of of being anti Israeli. Mhmm. Obviously, something happened to Benji and Trump. Nobody really knows.
Speaker 1:Yeah.
Speaker 9:But something happened. You know? And and Benji could not be the most friendly, you know, person to deal
Speaker 1:with. Sure.
Speaker 9:So something happened there. Yeah. But the countries like to think themselves as, like, the Switzerland of the region.
Speaker 1:Mhmm.
Speaker 9:In reality, they're just more pro Iran and Okay. Pro pro Al Qaeda. And and so that that's a that's a the the one thing I'll never underestimate is that the ultimate goal of every Trump, you know, conversation is a deal. That's what he loves. He loves deals.
Speaker 9:And and so us being particular hawkish on any type of country, I think, is kind of not who we voted for. It's we voted for somebody to make deals for America. And that includes a jet, which I don't know if it does or not. I I heard it was. It was not.
Speaker 9:Was
Speaker 1:included. Rumor?
Speaker 9:Yeah. Yeah. It was that new s m 47 or something like that.
Speaker 1:Yeah. Just see it it seems like a rumor at this point. Like, no one really knows one way or another what's happening with that, but it's an interesting story, certainly.
Speaker 9:No. I I had no problem like, he went to go see Kim Kim Jong un, like, whatever the No. No.
Speaker 1:I I completely agree with this. That's a great take. Yeah.
Speaker 9:So, like, I had no problem meeting with people. And if that means more I want them to be more pro Israeli, and I want them to they will get to release the last American. That's a win for our country.
Speaker 1:Yep.
Speaker 9:Totally. And and that that's what I voted. I I voted for Trump, and I wanted him to do deals. I wanted him to break the mold
Speaker 1:Yep.
Speaker 9:Reset relationships, and make it more pro
Speaker 1:And create more allies. Like, swing more people to our camp, like, regardless of the history. Figure out how to how to do deals and and and build more allies in the American sphere. I wanna talk about the learning curve, Huawei versus NVIDIA. Specifically, is that a dynamic here with pushing NVIDIA chips abroad?
Speaker 1:Is there is there value from actually advancing the technology, staying on the cutting edge just by increasing the volume of shipments and manufacturing? We've obviously seen there's TSMC on the learning curve. Mhmm. But, but what is your take on the Huawei Ascend versus Nvidia, Hopper Mhmm. Blackwell kind of, fight that's that's unraveling right now?
Speaker 9:It Americans didn't realize that, like like, lithography is not like a white technology. It's not like white people, like, own it. Right? It's a technology it's math. It's available to anybody that can work on it.
Speaker 1:Sure.
Speaker 9:And their their ability, yes, it's not TSMC level.
Speaker 1:Mhmm.
Speaker 9:Stretch, they're probably at five nanometer. They're more likely at seven, but probably stretch at five. TSMC's at two. It's about to go to, like, you know, 1.5, I think, or something to that effect. But but the thing you don't ever underestimate is that China, from a from a supply chain perspective, is is almost completely sovereign.
Speaker 9:Not only do they dominate rare earths, but they have the entire manufacturing infrastructure to make Huawei.
Speaker 1:Yep.
Speaker 9:And and that is a type of competitive advantage that we don't have.
Speaker 1:Yep.
Speaker 9:And and so now, again, like, it doesn't mean we become central planners and, like, drift into, you know, Linnaeus or Trotsky thinking that, like, oh, we should just essentially plan this entire thing. Like, that's not my view. I well, I view as comparative advantage. It works, like, as as Jordi was saying, like, all of a sudden, liberals remember that Adam Smith exists. And and, you the TDS has benefits.
Speaker 9:Right? Is it it pushes people to because it's because it's not a philosophy. It's a it's a it's a it's just like
Speaker 1:It's reaction.
Speaker 9:So yeah. Yeah. So it doesn't have an orientation. It's just not that big. Yep.
Speaker 9:But but, you know, like, we we have the ability to to win because we still are the best, but but they're just gonna take a different approach. Like, they're gonna take advantage of their their power. They're gonna take advantage of the fact they move fast and they're cheap, but a new AI built in road initiative has already started. They're already around the world. We know this.
Speaker 9:We see them at, you know, different data centers that we work with selling their stuff. And it comes as a fully complete solution with deep seek open like, Manus models combined with infrastructure, combined with support.
Speaker 2:Manus has has that kind of distribution already?
Speaker 9:No. No. Like, Huawei is designing for their their their open source ecosystem. Right. So Huawei is being the hands of heat out there building
Speaker 1:I think what Joey's asking is, like, have you ever run into a country that's not China that's like, yeah, we're we have Huawei Ascend, and then we have DeepSeek, and then we have Manus. Because Manus came out of nowhere just a couple months ago. Feels like that would be a very quick ramp to be like, it's deployed in another country as a part of the AI Belt and Road Initiative.
Speaker 2:DeepSeek, I can believe on. Manus,
Speaker 7:would give it.
Speaker 1:So, yeah, give give us the update on that.
Speaker 9:Yeah. Yeah. Yeah. It it's deployed. DeepSea and Manas are everywhere in Europe.
Speaker 9:Like, they're they're everywhere. And, again, it's open source. It it open source works as a distribution strategy. Yep. They're not open source because they give they they try to care.
Speaker 9:They don't care about open source. They care about defeating us. Mhmm. And and and so the the approach that this is why, OpenAI made that announcement of we're gonna do, like, this combined deployments of software plus, like, infrastructure is because that's they're mimicking what China's doing. Mhmm.
Speaker 9:But but the proliferation of the open source models go look at OpenRider. Like, you can just see the growth in other models. Those other models are Chinese. So so it it it it's a it's a race that actually is legitimately an arms race where there's not much of a like, like, what is the ceiling? Right?
Speaker 9:Like, if if we have to kind of think of it as imagine your multiple countries that someone invented a new technology like the nuclear weapon. Mhmm. Like, your the reason why UK, France, Israel, USSR, basic proliferation that happened was because America said no. We're not gonna give you any intel. Even though we promised, by by treaty, actually, that the UK and France would have our intel after Oppenheimer did what he did.
Speaker 9:And then that's what started the race. It's like, okay. Well, we can't just have America have it. We need to have it. Right?
Speaker 9:Mhmm. And so what is the actual break point at which all of it stops? It's like, how do you it's like it's like a it's a kind of different it's not an economic question. Right? It's a it's a Yeah.
Speaker 9:And that's why the the Gulf Region announcements are really exciting because, fundamentally, that region is gonna serve Europe. It's probably not gonna serve America. It's really gonna serve Europe. Because they can say all they want. They wanna build this many data centers or whatever, but the trying to make the EU do anything is is is you know, it's just trying to convince an obese person to stop eating.
Speaker 9:They'd rather just use Ozempic. Like, it it it's not gonna go anywhere. Like, they they they need some kind of, like, ejection to finally do something, and the the Middle East region and the Gulf Region is just really good at this stuff. They're good at real estate, building power, deploying crap. And, in in the airlines world, that market is dominated by Europeans.
Speaker 9:Europeans use Emirates and Qatar to fly to Asia, to fly to that region. I think it's gonna be really similar. So we're able to dominate Europe through those those relationships. But but if we're if we weren't gonna do it, my guess is, like, a year or two, Huawei would have some big announcement of doing with probably Qatar or probably the country I think of first, maybe Kuwait. But but yeah.
Speaker 9:And we still have to lead, but we have to realize that Huawei is gonna make inroads in places that we have decided to not, and we just have to accept that. We we can't stop. Yeah. I'm trying to think of another like like, it's What
Speaker 2:How did the how did the Manus investment from Benchmark sit with you? A lot of people that are a lot of people have
Speaker 1:pretty much everybody has an Speruhov or I'm upset about it.
Speaker 2:Yeah. Everybody's got an opinion on it. Yeah. But there's varying
Speaker 1:A lot of new comments, actually. I I I think everyone has an opinion, but not everyone's willing to share them. A lot of
Speaker 9:people have applied offline share it.
Speaker 1:Oh, yeah. It's because of, like, competitive dynamics and benchmark. They don't necessarily want
Speaker 2:to talk trash about another firm. Yeah. And I think that's the right stance sense. Generally Right. For the most part.
Speaker 2:Yeah. But we Unless you're done.
Speaker 9:I mean, I know. I mean, I I mean, I I don't care. Like, we could free change it. If if if they wanna do that, that's the prerogative. If the Georgia department wants to, you know, go after that investment, as they told me they're going to Mhmm.
Speaker 9:That's their decision. Like, is this a free market, free exchange of ideas? I believe your capital is your capital. Mhmm. And if you wanna deploy it to a Chinese model, then I question your patriotism?
Speaker 9:Probably. But, you know, it's your right to do that. And and it it doesn't need to go much farther than that. But Vanish has serious adoption, and we should think of it as I think that's a main benchmark we think about it is, like, you know, one, that they're gonna create, you know, a TikTok style, like, relationship. It's not real.
Speaker 9:All that stuff is a figment of our imagination. Think it actually matters to Chinese. It doesn't. But it is that that's just an excuse. The reality is, like, they they wanna win.
Speaker 9:They wanna make money. Mhmm. And in some respects, I understand that. I mean, we're capitalists here. And in another respects, you had to think about it from the the patriotism perspective with, like, we're we're not really interested in it's one thing to, like, maybe even allow GPUs to be sold there, which is gonna happen, by the way.
Speaker 9:GPUs are all all the trade deals include GPUs, man. Like, to think that that we're really that serious about, like, we don't want them to have infrastructure. Right? It's like
Speaker 2:it it it it's it's total baloney.
Speaker 9:Like, they it's such an easy give for the administration. We're the best. We wanna make a crap ton of money. We like that NVIDIA's rebuilding here. It's an easy give.
Speaker 9:It's not it's not it's not even hard to to debate over. It's like, oh, you want that? Sure. Now give me reduction of fentanyl. Right?
Speaker 9:Give me Mhmm. You know, stop tariffing auto imports by a %. Like, that's the stuff they really care about. So this is just an easy win. But but there will be a, like, a separation is happening to where China clearly is embracing and winning open source.
Speaker 9:They will have comparable advantage sorry. A a at least a reasonable alternative on Huawei probably in, like, twelve months Mhmm. Which will basically be like an h 100 ish. And it'll be cheap, large scale, easy to install, all open source. So the the next phase, if we want to actually win China, is what the Trump administration is doing now, which is Mhmm.
Speaker 9:Trusted proliferation. The second phase is, like, we gotta get serious about open source, and we have to be we have to be very intentional that the closed model thing is just not gonna work. It it it's it's not a it's not a serious durable moat. I think most investors would probably agree with that now. Mhmm.
Speaker 9:It's a myriad of models approach. Yep. And we we have to be in this game. Otherwise, it doesn't matter if if, we have the best infrastructure in the world. If the LLMs themselves are all caught by and closed door, which is never gonna reach this traction, which is never gonna reach this level of adoption.
Speaker 9:And, there are there are so many levels of advantage China has on open source right now, that that we have
Speaker 2:to be serious about. Expecting from deep DeepSeek r two? We've been we just asked the Mhmm. The Prime Intellect CEO that he had his own take. What are you expecting?
Speaker 9:I I think it'll be the rumor is, like, mostly on Huawei. I haven't validated that. That's the rumor I keep hearing. It probably, again, will be very good because this is accessible. This is math.
Speaker 9:It's open research. It's, it's like physics. It's like it's like thinking that we can control physics. Like, if physics is available to everybody, to explore and discover, I think it'll be very good. I think I think it's a Quinn three point five was very good.
Speaker 9:Yep. And Manasseh just had an update again. It it shows that, unless we were heavily invest with, I guess, you know, Gemini or or or Lama to really, like, up their game, that Europe's gonna continue to use that. The Middle East continue to use
Speaker 4:it. Yep.
Speaker 9:And it just is what it is. Like, we we can't stop people from doing this stuff. So It it's available to everybody.
Speaker 1:Yeah. So, I mean, walk me through this hypothetical scenario where, let's just use, like, Switzerland as an example or something. Like, Switzerland, wants to control their own AI for their own population, so they build swissgpt.com. And every Swiss citizen is going there as the front end to their AI experience. Sure.
Speaker 1:And but that in one scenario, you know, that is run on air gapped Huawei Ascend data centers running DeepSeek and Manus to actually do the computation, but the data is not being exfiltrated. What is the risk there? Is it just that we're losing the economic power from selling into Swiss the Swiss the Switzerland market? Or or is are we worried about some sort of, like, Manchurian candidate in the weights shifting the minds of the Swiss population or something like that? Like, what what what is the risk of the power accruing in that scenario?
Speaker 9:I mean, I mean, I I I don't really worry much about, like everyone knows what happens in 1989. Like, don't need your cannabis score happened. It's not then when deep sea turrets delete itself,
Speaker 1:like Yeah. Yeah.
Speaker 9:Yeah. Everybody knows. Right? Yeah. It's very obvious.
Speaker 9:Like, you know, is president Xi, you know, Winnie the Pooh could possibly be, like, you know, we don't really know. Right? He did some he did disappear for six months after COVID. So, like, he's Winnie Winnie the Pooh in a in a, like, little outfit. So, yeah, like, the the the the issue with the I what I believe about Sovereign AI is that most of the content in Internet is American English.
Speaker 1:Yep.
Speaker 9:Like, the estimates are, like, 70%.
Speaker 4:Yep.
Speaker 9:So that's most of the training data. Yep. Although, if you look at the proprietary data what does that mean?
Speaker 2:I just did it. It's just good news. 70% of the Internet is Is American.
Speaker 1:Let's go. We're just excited about that.
Speaker 9:The the so so they they so they get, like, Cyber AI. What is the data that they're gonna be training on? Yep. And because if the Internet is English, American English, it's our slang, it's our, you know, it's our the second is Spanish, and the third is is Mandarin.
Speaker 1:Yep.
Speaker 9:It's it's actually government documents. That is how most people are training the governments are training their own subset sovereign AI. Legal cases Yeah. Yeah. Law.
Speaker 9:Right? And none of that crap is going to Amazon. None of that crap is going to Corey. Like, they're they they're gonna build that to to their liking.
Speaker 4:Sure.
Speaker 9:So then, okay, so what is the end end use case? I one is that most of this is mutual search instruction sort of frameworks. Mhmm. That if Switzerland doesn't do it, then maybe Austria does. And if Austria does it, they have a lab drawer of Switzerland.
Speaker 9:So they're like, well, I can't have that, so I have to do that. Mhmm. Think of it as did you ever watch show Billions? Yeah. I love that show.
Speaker 9:So Yeah. So Axelrod. Right? Everything he thought about was, like, both him it's like it's like two lanes of thought. It's like him winning and him not being owned by one of his competitors.
Speaker 9:Mhmm. And that's the way g GPUs and AI works. It's like it's like I think from the perspective, like, sure. Was an advantage to my my country, like Axelrod doing investment. But most of it is just like, I wanna screw over that other person.
Speaker 9:And and and and investing, like, traders today, they're doing GPUs AI stuff, not necessarily because necessarily as a return today, because they're trying to figure out, is someone gonna screw over me somehow? Because when you when you put something into an LLM, it's immediately, everywhere. Right? Like, anything now like, private information is even more valuable than ever before because LMs make information so accessible
Speaker 2:Yep.
Speaker 9:And can substantiate content even easier. And and so private information becomes significantly more valuable. And so how Switzerland would deploy that, in my view, would be basically spying other people to, providing an alternative within its own government about, like, how to actually use LMs internally. And so it the the I I think we, as Americans, need to just kinda take take a step back and realize that not everything the world does has to make money. Mhmm.
Speaker 9:People just kinda do stuff sometimes because they think they should do it. Mhmm. And and how we as Americans, we don't really get that. Like, it's it's hard for us to kind of put our hands around.
Speaker 2:So commercial.
Speaker 9:Yeah. Yeah. Yeah, go like, exactly. It's like, like, the we were so far away from Reagan where we just, built crap because we're like, Soviet Union could do this to us, so we're just gonna do it. Yeah.
Speaker 9:We're so far away, and we're we're so dominant for so long that we're lazy. We're we're we're self absorbed, lazy people who think that Pope Leo had you know, was a Chicago Democrat. It's a it's a you know, I'm not a Catholic, but he's he's certainly not. And, oh, he said this about immigration. And I'm like, do you know anything about Catholic doctrine?
Speaker 9:Like, do you read anything? Like, do you know, like, it it it's we we
Speaker 2:and what I mean by that
Speaker 9:was that we define so much international dialogue by America's framework
Speaker 1:Sure.
Speaker 9:When the world doesn't work that way.
Speaker 2:Yeah. Yeah. Real quick. I wanna have a couple, couple more questions, and then we have a a pretty hard stop here. But, who is going to be the American open source AI front runner?
Speaker 2:XAI did an open release of Grok Mhmm. One. OpenAI is planning to have some strategy around open source. Do you have any type of do you have any expectations here?
Speaker 9:I I don't think it'd be OpenAI. I think it's either gonna be Zuck, Elon, or somebody else that we just don't know about yet.
Speaker 2:Yeah. Cool. Last one. Do you expect to be satisfied when a TikTok deal gets announced or extremely disappointed? Because the rumors that we've heard so far are that it doesn't necessarily get at the core
Speaker 1:is the inference? What's wrong with that? Inference is the important part. Right?
Speaker 9:Yeah. That that's a good question. So do I think it's propaganda? Oh, absolutely. Do I think it matters in terms of the trajectory of a culture?
Speaker 9:No. Like like, creating blaming Chinese boogeyman, but, like, on the fact that our kids are lazy and stupid is is asinine. It's it's classic, like, white guilt sort of ducking Freudian frameworks. And, like, the reason why isn't it's actually you know, like, your kids will actually be fine. They're they're leaning very heavily libertarians, so they're actually good.
Speaker 9:This kind of, like, late millennial because I'm in a I'm a midlife millennial, so I'm more Gen Xer. Mhmm. So this kinda, like, late millennial and early next gen that are very Marxist in their kind of, like, frameworks. And they've been told things about their objectively lies about our country, about how, like, life works and success works. And, yeah, I feel bad for them, like, because they were told things that were not true.
Speaker 9:But, like, saying that, oh, the reason why, you know, Chinese kids are doing math because TikTok, like, encourages math is is is is pretty stupid. Like, it's it's like it's like, no. They were just like
Speaker 2:No. My my my was, you know, if you're if you're in the middle of an ideological war, trade war, you know, sort of great power conflict, we're not, you know, multi polar is not possible. It's just sort of like The US or or nothing. Why would you allow your adversary to own what is effectively like the one of the largest news channels into The US population. And why would you kind of ignore that?
Speaker 2:Right? Because even even, yeah, getting, you know, delivering brain brain rot. Like Americans are gonna get brain rot from somewhere. Right? They have an insatiable made brain rot.
Speaker 2:But I'd prefer to be no. I'd prefer to be American made brain rot. American brain the you know you know, the these platforms do influence public opinion and and but anyways, probably a longer conversation. We'll have you back on when the news gets announced and
Speaker 4:In the meantime.
Speaker 2:A pleasure,
Speaker 1:Have a good day.
Speaker 9:God bless, guys.
Speaker 1:Talk to you soon. Cheers.
Speaker 9:I want a hat. Jordy, want hat.
Speaker 2:Oh, I got you. I got I got you. You get a jacket too. You're gonna get the full I'll do.
Speaker 1:You get
Speaker 2:the full set. You're gonna get the full set. Thanks, Aaron. Great chatting.
Speaker 1:Talk to you soon. Bye. Find your happy place.
Speaker 2:Find your happy place.
Speaker 1:Book a wander with inspiring views, hotel grade amenities, dreamy beds, top tier cleaning, twenty four seven concierge service. It's a vacation home, but better, folks. Also, head over to getbezel.com. Your bezel concierge is available now to source any watch on the planet. Seriously, any watch.
Speaker 1:And our next guest is Dan Gray. I have been following him for just a few days, but I wanted to have him on the show. He's put out some fantastic posts about venture capital market dynamics, and I thought it'd be interesting to have him on the show and pick his brain and have him break down what he's seeing in the venture capital markets. I wanna talk to him about large scale up VCs, the cram down in the angel and seed market, all the fun dynamics. So welcome to the show.
Speaker 1:Dan, if you're there, can you hear me? How are doing?
Speaker 8:Long time listener, first time caller.
Speaker 7:Glad to
Speaker 4:be here.
Speaker 1:Yeah. Great to have you. Can you take me through your oh, actually, first, let's kick it off with just the introduction. How who are you? What do you do?
Speaker 1:Break it down for everyone.
Speaker 8:Sure. Yeah. I'm you know, my my kind of day job is is head of insights at Equiderm. We're a startup valuation platform, and that's kind of the perspective from which I come at all of this.
Speaker 2:Yep.
Speaker 8:I think what I'm what I'm most known for is like long walls of text on Twitter about the venture industry.
Speaker 1:And what was the most recent long wall of text that you put out?
Speaker 8:Yeah, that was kind of like a summary of the, like, the last year or so of of observations. Cut like, not a very optimistic title. It's like the venture capital and ailing asset class addressing a lot of the challenges that we've seen.
Speaker 1:Yes.
Speaker 8:But it moves towards like solutions, you know, better practices, some ideas for how the industry can evolve so everybody comes out of it better, you know, LPs, founders, GPs.
Speaker 1:So what are the key cracks? Why is venture capital ailing? What are the key problems that you're seeing? What are the indicators? What are the metrics that you're tracking?
Speaker 1:Because a lot of people have been saying we're so back. It looks really good. There's big funds. Everyone's doing well. Everyone's making money.
Speaker 1:It seems like it. So this is kind of an odd take to see, but open to hear the argument, obviously.
Speaker 8:Yeah. I think kind of what we see at the moment, if you look very broad, big picture, is like stagflation.
Speaker 1:Mhmm.
Speaker 8:There is, I would say, less activity than before, but prices in concentrated areas are much higher.
Speaker 1:Mhmm.
Speaker 8:And for a lot of people that's a very bad thing, know. If you're a founder's fund and you can win on merit and get into any deal you want, you're doing fine at the moment, that's okay. If you're Andreessen Horowitz and you have the scale to buy into any deal, you're also doing fine. But a lot of my writing is actually really aimed at like the middle of the market. GPs who you know could be doing better maybe if they, if like better practices were more accessible to them or if the market was a bit more stable.
Speaker 8:Similarly, LPs who have a difficult time picking, you know, if they're not already in, like, the founders funds and USVs, how they can be guided towards better decisions and and better returns.
Speaker 1:So, yeah, is this just affecting new managers who raised funds maybe during ZERP, or are you seeing cracks in, kind of the the legacy firms that have dropped out of the public eye? They're not as competitive, but they've been in the game for a decade. They have kind of an institutional structure. Maybe they're not raising multibillion dollar funds, but they have a model where it's like, yeah, $300,000,000 fund every two years. You deploy it.
Speaker 1:It's great business. All the partners are gonna retire wealthy. Are is there risk for that type of mid market VC firm?
Speaker 8:I think the ones that are struggling the most at the moment are perhaps the ones that like haven't evolved as quickly as the market has shifted in the last year. So we've seen this this much talked about bifurcation into like what I call venture banks, so like Andreessen Horowitz and Thrives etc. And the kind of traditional model of VC, which is you know contrarian investing, a bit more disciplined you could say on that front. There's a few people, a few funds, kind of stuck in the middle, you know, and they're a mid sized series A firm who's still trying to invest in AI and they're having a very difficult time right now. So you kind of have to pick your lane a little bit these days and lean into the strengths of what those two different lanes offer.
Speaker 1:Did you ever read Eve Everett Randall's post on, like, the Tiger Global and the, and the and, like, the squeezing between, what what was he calling it? He had some great phrase for it. Playing different games. Why Tiger is eating your lunch and your deals. It was kind of talking about how Tiger and the crossover investors came in, and they were just commodity capital that you could just show up with a deck and get a term sheet same day, and it was very much like venture bank, versus the, well, how do you describe it?
Speaker 1:He said the, he described, one of the funds as, JCPenney funds, which is very, rude. That is the dead zone. So there's Tiffany and Co, which he said was, like, benchmark founders fund, like, the really, like, prestige sequoias of the world, low velocity, higher IRR, main advantages signaling, building a board of directors, but it's expensive capital. Then you have the Walmart, which was Tiger Global, higher velocity, lower IRR, but they're built to to accept a lower IRR. Mhmm.
Speaker 1:Although that didn't play out very well for Tiger specifically, in theory, these venture banks are kind of playing this Walmart category. But the dead zone was the JCPenney where you're not super differentiated, sending a really strong signal to the market that we have picked the winner. They're going to the moon, and so get in or get out. But you're also not super founder friendly, not taking a board seat, just dumping cash in a company. Is that dynamic still real in your mind?
Speaker 1:Has it grown or has have things changed?
Speaker 8:Yeah. I think it's very real. It's definitely real, and you can see that in a lot of the liquidity issues today. So you have you know the big like venture banks, let's call them. Yeah.
Speaker 8:They're finding more opportunistic liquidity through secondaries for like the huge winners that they invest in who have the strength of brand and the size to generate a lot of liquidity in that manner. Where other VCs would traditionally get liquidity, IPOs and M and A, we all know has been very slow, that slowed down for a range of reasons, but it's part of because the industry became so bloated and confused for a while. You know, hopefully as this this bifurcation is better understood, those more traditional managers are like teeing up companies for exits in a healthier way, you know, they better understand the kind of exit metrics you need as opposed to the the venture bank model.
Speaker 1:Do we need to kind of redefine these terms of venture capital? Because it used to be there was like angel investors, then venture capitalists that would do series As and maybe series Bs, and then there was growth equity, private equity. And then, like, yes, a hedge fund might take a large position in a late stage firm, but they weren't seen as VCs. Now you can have a VC firm that I'm pretty sure there's venture capital firms that have never invested in a company at less than a $1,000,000,000 valuation because their whole business is maybe we buy secondary or we buy common or we do growth stage. And we're really only trying to be along for the unicorn to $100,000,000,000 ride.
Speaker 1:And we'll do that all day long because there's so little downside. And by the time we're investing, the company has durable revenues, is growing, product market fit. So we're not even trying to underwrite the founder or their ability to explore the idea maze. We're just piling in, but we still call that venture capital. And maybe that's is that a problem or do we need to think about the the the market differently?
Speaker 8:I think it it's definitely helpful to to think about it as a slightly separate beast. You know, venture capital in my mind is finding, you know, the nonconsensus companies and then you you fund them through into, like, legibility into growth, growth capital and ultimately to an exit. That's how you generate your liquidity. The new game today is kind of like this financialized version of venture capital where it's not necessarily about like finding great companies and taking them to exit, it's about like funding through the like the incremental milestones and hitting those incremental metrics to raise bigger funds, know, and you do that through pursuing TVPI in a way that like it's slightly disconnected to generating value in the traditional sense. You know?
Speaker 8:Yeah. TBPI is a has slightly different drivers, you could say.
Speaker 1:Yeah. Do you think that part of the reclassification as somewhat other asset classes into venture capital is driven by a desire to mimic the fee structure of a traditional venture capital firm in other in other industries. So I'm a I basically were doing public markets investing, and I might be able to get one in 10. But if I call myself a VC firm and I play a little bit differently, I get two in 20 or something like that. It do you think that the branding matters when VC firms go out to LPs and try and raise money?
Speaker 8:That's a good question. I'm I'm not really sure about that, to be honest. Mean, I'd hope LPs were scrutinizing that a little bit more, but perhaps not.
Speaker 2:What do Do you look at any data on the health of the sort of retail in the private markets, right? Like the everyday angel investor? Are you seeing more or less activity today than in 2021, early '20 '20 '2?
Speaker 8:I would say quite a bit less, probably like a third less at the moment. That's because so much attention is concentrated on AI, and I think a lot of angels frankly have just resigned themselves. Like they're not gonna get in on that game.
Speaker 2:Yeah. Interesting. Yeah. I was thinking I I was I was even gonna consider doing a poll to anybody within, you know, just a poll on x or whatever. But I think if you ask the average angel investor, would you sell your entire angel investing portfolio for 15¢ on the dollar today?
Speaker 2:And I bet you that I bet you the honest answer is that, like, 90% of of people would because angel investing is this, like, weird dynamic where to me, I I legitimately feel addicted to angel investing. Like it like it's it's a weird thing but and I and I joke about this. Right? It's like all these kid you know, these kids that grew up in San Francisco and their and their parents are addicted to angel investing, you know. It's like refreshing their refreshing their email on the first of the month, you know, waiting waiting for waiting for the update.
Speaker 2:But it's but it's this interesting, you know, dynamic where it's honestly one of, you know, to me it's one of the most interesting ways to spend free time. It's just like meeting exciting founders, but at the same time.
Speaker 1:Liquidity timeline.
Speaker 2:Timeline just Timeline long even if
Speaker 1:you make money, it's like, well, didn't get to enjoy that in my thirties. Yeah. Like Yeah. Totally. Maybe it's retirement.
Speaker 2:And I have I have buddies that are that are towards, you know, the end of their careers or or maybe even retired that are that are basically, like somebody recently said to me, I don't want to make net new angel investments Yeah. Because I don't wanna deal with this when I'm like potentially in a retirement. You know, like That's crazy. Potentially like, you know, retired to Hawaii. Right?
Speaker 2:I don't wanna be worried about, you know, figuring out, oh, when when, you know, when should I try to exit,
Speaker 1:you know, this position. Dan, can you break down this idea that most venture capitalists don't understand risk management and, only 10% of venture firms are making it to fund four? What do VCs get wrong about risk management? What does risk management even mean? I thought the whole point was to be risk on, swing for the fences.
Speaker 8:Man, it's a that's a great question. It's a a real fundamental point as well. I talk about, like the importance of risk management in venture capital and people do give me a slightly crazy look, like the point is risk.
Speaker 1:Yeah.
Speaker 8:But if you properly manage risk, like in a systematic way, you can take more risky bets. Like that's kind of the point, like if you understand the maths of portfolio construction, how big your checks are going to be, you know, what the outcome is likely to be, how many you have to write, what maximises your exposure to potential unicorns, you know, what discipline across the whole portfolio looks like, you can take more risk on an individual investment basis. And Yes.
Speaker 1:So what does a what does a poorly risk managed fund look like? Is it is it just not building concentration in the winners, not leaving money in the fund for pro rata and follow ons to kind of ride the winners up as they become outsized winners? I feel like that was something that we heard from, like, the last generation of managers that got a $50,000,000 fund, then everything got marked up in ZERP, and all of a sudden they had to make these decisions on huge pro rata checks out of their main fund where there really was no new data about the company and they were still at a seed level. But Mhmm. Some big firm had come in and preempted a series a or series b.
Speaker 1:And so all of a sudden, you can't do the normal thing of, wow. There's so much traction on this company. I need to really make sure my fund has significant ownership because I did get a foothold in, but I need to build that position. Is that what's going on, or is there something else, some another dynamic?
Speaker 8:Yeah, it's a that's a part of it. That's quite a big part of it. Mhmm. I think the, like, the fundamental thing is the having a right sized initial portfolio, the number of investments that you make to begin with.
Speaker 1:Yeah.
Speaker 8:That should be diversified enough and, know, the the average might be like 25 today. Maybe it should be 50.
Speaker 1:How do you even calculate that? Is that based on, like, historical trends in, like, the number of unicorns or something? Like, how how are you how are you thinking about that?
Speaker 8:Yeah, exactly. There's there's great work done by a few people. Dave McClure from five hundred Startups, he has an article on this. He talks about, you know, a hundred startups should be the portfolio size for a for a seed fund.
Speaker 1:Wow.
Speaker 8:Because of the small percentage that eventually become unicorns or decacorns. Yeah. And you fundamentally don't know begin with which ones are going to work out. That's kind of the problem is VCs over concentrate. And of course, if you're, you know, I've I've spoken to some great GPs about this concept and they always push back because they have 15 companies and they're all doing great.
Speaker 8:And that's like, fine. Good for you. You're in the top 2%. It's the other 98% that I'm kind of thinking about.
Speaker 1:But is that really a way to get to by definition, the don't you to be in the top 2%, don't you have to behave like the top two percent and just actually, like, consider it a skill issue and just make
Speaker 2:sure you're you're trying to get you know, I can see the argument if you if you're trying to get past fund four Yeah. Which is like the milestone
Speaker 1:Yep.
Speaker 2:You need to have bangers in the first
Speaker 1:fund. Totally.
Speaker 2:Right? Like, even if even if you're not necessarily even if your ownership is not amazing, you need to be able to prove that you can get into winners at all to some degree. And so I've seen that strategy play out fairly nicely where as long as you're in a handful, you know, just get showing that you can get in is kind of like key proof points even if you're not able to concentrate, you know, five plus percent of your of your fund in a in a single company.
Speaker 1:Yeah. Do you think do you think LPs are more willing to forgive on mistakes of portfolio construction not sizing into winners easier than missing winners and having, like, okay. Yeah. You built the portfolio perfectly. You got concentrated into your winners properly, but you didn't have any of those really sexy companies in the portfolio.
Speaker 8:Well, I'd like to think ultimately what matters is, you know, the end multiple, the IRR, the performance of the fund. And everyone, you know, the majority of emerging managers come out swinging for the fences every single time they want a 10x fund. And in doing so they are like are themselves boom or bust. If they fail and it's less than returning capital, they have no room to learn, they can't improve for the next fund, you know, there's no step two. If they are a bit more conservative, a bit more diversified, and they return like 2.5, three x, maybe they get a fund too, and they learn, and they can improve and earn concentration over time.
Speaker 1:Isn't there something beautiful about the fact that both startups exhibit a follow a power law and venture capital firms exhibit a power law? Like, there's a there's a kinship here that it's like, hey. We're all either gonna be rich or poor here. There's no median outcome. You're not just a bank to me.
Speaker 1:You're not gonna be around unless this works out. You're living under the power law just as much as I am as the entrepreneur.
Speaker 8:I would disagree with that, to be honest
Speaker 1:with you.
Speaker 8:Please. I I I think it it's a better world for everybody if the VCs are more stable.
Speaker 1:Okay.
Speaker 8:They they they are very power law. They are boom and bust. Yeah. They don't really have to be.
Speaker 2:They don't have to be. Interesting. Interesting. Well
Speaker 1:Yeah. This was great.
Speaker 2:This was great. Yeah. Thanks so and sharing. Next time you have a report, give us a heads up. And we'd love to have you back on
Speaker 1:to Yeah. Was a pleasure. See you, Dan. This is great.
Speaker 2:Cheers.
Speaker 1:Thanks so much.
Speaker 5:Thank you.
Speaker 1:Let's run through some timeline. Let's give some updates, whatever else is in the news.
Speaker 2:I've got an idea before we jump into the timeline. Should we talk about Figma?
Speaker 1:Of course. Figma is
Speaker 2:design tool of my dreams. It's a tool that I've used for my entire career at this point.
Speaker 1:Think bigger, build faster.
Speaker 2:That's great. Because you didn't airborne for that.
Speaker 1:Redesign how you design, explore your ideas freely, and iterate quickly.
Speaker 2:We should make an actual like old school style radio ad For
Speaker 1:sure.
Speaker 2:For this. But but anyways, Figma launched a bunch of new features last week at config. One of which is very cool. They allow you to generate marketing at various types of assets based off of your brand book. It's called Figma Buzz.
Speaker 2:Very cool. So exciting new feature from them alongside sites and and kind of the core, you know, design tools that you probably already use and love. So go check out Figma Buzz and sites and thank you to Figma.
Speaker 1:Thank you for taking show.
Speaker 2:Should we talk about some timeline?
Speaker 1:Let's do it. Jason Kalkanis of the All In podcast is is taking the movie industry to task. He says the movie industry is effing clueless. Make a $19 a month all you can watch, $10, plus $10 for each kid and $49 for a family of five. Watch the money pour in.
Speaker 1:He wants a subscription. Movies would be huge if you made it a season pass like the ski industry did with the epic pass. Show old movies too for bonus points. AMC will slash prices on Wednesday as the news by 50% starting in July. The goal is to get more people in theaters between weekends.
Speaker 1:What's interesting is that I saw a separate article about how, the modern instantiation of a Movie Pass is wildly successful. Have you heard of this? Yeah. I think it's like
Speaker 2:Well, yeah. Apparently AMC has a subscription product
Speaker 1:already. They do. They do
Speaker 2:stuff that was think the interesting thing that Jason called out is showing old movies. Think one of the challenges is that there's so few new movies coming out that people are genuinely, you know, wanting to get up and go see.
Speaker 1:Yep.
Speaker 2:I don't know if old movies would do it, but
Speaker 1:They do re releases all the time and they are available and I don't think they build as much hype because I I Yeah. Think there's some weird dynamic in the movie industry where
Speaker 2:like I think
Speaker 1:Unless you get the billboard and the hype and like you you're you're texting your voice.
Speaker 9:I think
Speaker 2:it I think it comes down to scarcity that the Yeah. They need to pull movies off of every off the internet entirely Yep. For every year.
Speaker 1:It's
Speaker 2:good. And then just build it up and being like, we're bringing it back. You know, the people some people will be like, well, have a DVD. I can watch it anytime. Good luck playing a DVD on your home entertainment system if you got it in the last Not gonna work.
Speaker 2:Five years. Not gonna work.
Speaker 1:Anyway, staying with the All In podcast, Chamath Palihapitiya says, not nearly enough people are talking about the implications of Klarna rolling back some of their AI bets, not knowing any of the details. I can guess why. Replacing determinism of or humans with probabilistic code is fraught with edge cases and require new ways of software development and process engineering that aren't well solved. The implications to an entire generation of AI apps will be as severe, will be severe as as more companies come to terms with the difficulty in getting products to work reliably in production with AI in the loop. Customer service may be the first funeral signpost.
Speaker 1:The result will be that many startups need to pivot to simply use AI for narrow use cases and otherwise act deterministically. So what will what will so what have people funded then? An AI company? No. Not really.
Speaker 1:Just a really overpriced SaaS company at AI valuations. Interesting. What do you think?
Speaker 2:I mean, I thought the conversation with OWN yesterday from Intercom was super insightful. Yep. Right? They are incredibly well positioned to deliver AI to CX teams Yep. And and unlock the power of it.
Speaker 2:But they're not saying they're he he wasn't coming on and saying 99% of tickets are solved by AI today. Yep. He believes that, you know, we can get there over time. And he his hot take was that, you know, AI was, you know, better than humans already at a lot of things, right? It stays on script.
Speaker 2:It doesn't get tired. It doesn't get short. It's not temperamental. All these things that, you know, end up creating a better customer experience once the quality is at a certain
Speaker 1:point. This idea that we overestimate what can be done in a year, underestimate what can be done in a decade. You got superhuman auto complete for every single one of your customer service agents. You got much better ways to navigate a knowledge base effectively and just serve up a better Google search, use it as a knowledge engine. And so that should drive those.
Speaker 1:But trying to go full Klarna mode and saying, you know, we're not hiring anyone. We're gonna be a one person company, probably a little aggressive. Yeah. Anyway, Avi Schiffman, founder of Friend dot com says, I met my investors' LPs and realized I'm just working for college endowments and fan family offices.
Speaker 2:Activate Go golden retriever. Yeah. You are. And it's good. It's an opportunity.
Speaker 2:It's an amazing blessing.
Speaker 1:I mean, we heard about this from Andrew Reed talking about when he who was pitching
Speaker 2:It's not.
Speaker 1:Dylan Field at Figma. He brought him into the the Brown Conference Room and said, hey. Like, we work for Brown.
Speaker 2:An opportunity to run it up for Brown.
Speaker 1:Yeah. You have an opportunity to run
Speaker 2:it up for Brown. Run it up to go long Brown. Exactly.
Speaker 1:You're you're a long line.
Speaker 2:College endowments. It's it's teacher pension funds. It's, you know, you're supporting firefighters. Yeah. All these things.
Speaker 2:So you're supporting, you're helping big oil,
Speaker 1:mean, is part of the beauty of like the intertwined financial system is that losses are born across the entire economy so that any one company that blows up doesn't destroy everyone's pension. And then but but when there's big winners, everyone kind of benefits. If you have a pension or you go to one of these schools. Like, their endowment is enriched and they do more research and science and all sorts of stuff. And so you you have kind of a I mean, it's just it's diversification.
Speaker 1:Right? It's just diversification. And so, like, you you don't hear as many of those stories about an individual main street investor that lost all their money on a risky start up bet because angel investing is, while addictive, it is for high net worth individuals and accredited investors only, but they still have exposure to the venture markets through LPs. Yep. Prime Video has renewed Beast games for not one but two more seasons.
Speaker 1:Y'all are not ready for the big stuff. We have plans, says Mr. Beast. Very interesting. This was one that was, like, hotly vintage about whether whether whether it was good.
Speaker 1:It's hard to track because you can't just you can't just look at the YouTube metrics to understand if Beast Games is truly successful for Amazon Prime. But we have the data now. Season two and season three confirmed. They probably wouldn't have done that if it underperformed. So interesting watching a YouTuber transition to mainstream media or, you know, bigger platforms.
Speaker 1:I mean, Amazon Prime's new media, but still, you know, a a huge company, major network. He's clearly worked out a fantastic deal, and we've seen a bunch of this. And it feels like it's more of a increasingly, social media is a proving ground for Hollywood. Talk about Pat McAfee, what he did with his podcast, took it to ESPN eventually. I think we're gonna be seeing a lot more of this as people, build, independently and then ultimately leverage the distribution that comes from something like Amazon Prime.
Speaker 1:So congrats to Jimmy. We should have him on the show. Dalton Caldwell says the S and P five hundred now has three YC companies, DoorDash, Airbnb, and Coinbase. Let's hear it for YC. Can we get the can we get a size gong or some platform or something?
Speaker 1:Congratulations,
Speaker 2:guys. Wait to go back to the next demo day. Yeah.
Speaker 1:Me either. It is it is actually crazy
Speaker 2:how how big that YC has
Speaker 1:done this because no other incubator is even close. Right?
Speaker 2:And I'm excited for the update in in 2055. The S and P five hundred is now percent Y Combinator company.
Speaker 1:For sure. Certainly, if you expand that to YC Founders running companies, probably Yeah.
Speaker 2:PG says 497 to go.
Speaker 1:497 to go. PG, I like it. On a conquest. Good job.
Speaker 2:And all are consumer tech, Everybody says build B2B SaaS until you see some of the biggest outcomes.
Speaker 1:Just wait. I mean, a couple of those payroll companies will be in the S and P 500 pretty soon, I'm pretty sure. All three. All three of them. Aiden says Uber would be a lot cooler if it was called American Express.
Speaker 1:I just love this guy. He has seven likes, low tam, but
Speaker 2:Low tam banger.
Speaker 1:Yeah. He also had another post that we didn't get to yesterday that was like if if if the airline's calling your name personally as you board the flight, it's basically like flying private.
Speaker 2:I thought that was funny. Anyway, shout out
Speaker 1:to Aiden. Great great programmer. Great hacker. Airbnb is launching. They're they're unveiling their next chapter.
Speaker 1:This is going live today. I don't actually have the update, but Yes. Launching the fire founder mode.
Speaker 2:So they're launching new services
Speaker 1:Okay.
Speaker 2:Businesses. Oh, interesting. There's a redesigned app. So remember, they condensed a bunch of launches into one.
Speaker 1:Yep.
Speaker 2:And so
Speaker 1:they're
Speaker 2:And they
Speaker 1:were really expanding the experiences for a while
Speaker 2:as well as the existing Expanding beyond homestays. And I guess they're going to invest a quarter of a billion dollars into this new sort of business line.
Speaker 1:They're it.
Speaker 2:It's it seems like an extension of their kind of experiences, products.
Speaker 1:Sure.
Speaker 2:But anyways, hopefully they can
Speaker 1:Hopefully they not can, hopefully they don't crush under the weight of competition with Wander. Yeah. Honestly, that's the that's my only hope because I love BranchCenter
Speaker 2:series b.
Speaker 1:Founder mode CEO. Love him.
Speaker 2:But They're gonna be feeling the heat.
Speaker 1:They're gonna be feeling the heat from Wander for sure. Adam D'Angelo said, at Quora, we recently tested switching from Zoom to Google Meet for a week. Google Meet is better in many small ways, but bit worse in one big way, audio quality, particularly background audio noise cancellation, echoing. That kills it, so we're staying on Zoom. I know it's funny just like, hey.
Speaker 1:I did this, AB test, and we're sticking to we're sticking to Zoom. And Sundar Pachai responds.
Speaker 2:Says, hey. Hounder mode.
Speaker 1:We'll follow-up offline as we have an experience. As we read notes below, it works pretty well in my experience. We'll we will debug to understand the root cause and fix. Thanks for flagging. Thank you.
Speaker 1:Would've would love to switch if this is fixed. And Nathan, a buddy of mine says, I have the inverse experience. Zoom is, well, rubbish in it. In he's British or French maybe. I don't know.
Speaker 1:He's over in Europe somewhere. Don't know the specifics
Speaker 2:of We're rubbish. Anyway In it.
Speaker 1:Anyway, Teddy Blank had a coinage. Once your VC has, what was it? The actual coinage was something about once your once your, company's LinkedIn profile picture is the founder holding a microphone at a conference, you're
Speaker 2:With one of the.
Speaker 1:Yeah. With one of those. Which I don't think is really true necessarily because a lot of the big CEOs, they wind up doing that anyway. Bezos, Steve Jobs. I'm sure all these guys have been pictured with lav mics, but still funny to see that, yeah, if you grow up too much.
Speaker 1:So, anyway, shout out to Teddy. Anything else you wanna cover? Should we get out of here? It's 205. Thank you for watching.
Speaker 2:205.
Speaker 1:If need more plugs, go to Aurora.com. To Lucie.com.
Speaker 2:Always go to you should always go there. Go to Aidslip. But but no, I'm excited for the show tomorrow. We got Brian Johnson calling in as well as Mateo from Eight Sleep. Should be great.
Speaker 2:Yeah, go and leave us a five star review on Apple Podcasts or Spotify. It helps us. I think it helps us. I don't know what it does. But if you do leave a review, we will talk about it on the show.
Speaker 2:Hit over probably put an ad in it.
Speaker 1:Keep tracking the largest company at the May. This is the Super Bowl of big tech. Microsoft's at 60% right now, but they dropped just recently, down from 80%.
Speaker 2:This chart is
Speaker 1:actually is climbing fast. Apple's climbing as well. It's a knockout, drag out fight for the largest company at the May. Head over to Paul's. Check it out.
Speaker 1:Anyway, thank you for watching.
Speaker 2:The only market that matters.
Speaker 1:Talk to you soon. Cheers. See you tomorrow. Goodbye.