Technology's daily show (formerly the Technology Brothers Podcast). Streaming live on X and YouTube from 12 - 3 PM PST Monday - Friday. Available on X, Apple, Spotify, and YouTube.
You're watching TVPN live. It is Monday, 03/24/2024. We are live from the Temple Of Technology, the Fortress Of Finance, the capital of capital. This show starts now. We got a great show for you today, folks.
Speaker 2:Thanks for saving me there, John.
Speaker 1:How's your morning I
Speaker 2:wasn't quite sure. I was too focused on my routine this morning. I forgot to focus on the job at hand Yep. Which is to do the show.
Speaker 1:I woke up at morning. Fifty. You woke up at 04:50.
Speaker 2:That's right.
Speaker 1:There's a guy online who woke up at 03:40.
Speaker 2:He's doing 03:40. Mean, there's real alpha if you're a morning routine guy and you're just getting up. If that's your identity, just be the be the boss. Be the final If you're
Speaker 1:gonna film it, you gotta get it even earlier to talk to your cinematographer. Hey, can you get me to the building, set up the cameras for every single shot. A fantastic It's strategic
Speaker 2:to start your day at midnight Yep. When, you know, the clock strikes, you know, 12:01, just just get into it.
Speaker 1:I've been saying that. I I've been waking up earlier and earlier to the point where some days I'll wake up at noon the day before Yeah. Just to be super ready for the next day. Yeah. But we are, of course, talking about Ashton Hall, the viral influencer, fitness influencer who has a bizarre morning routine where he dunks his face in ice water and rubs banana on his face.
Speaker 1:But respect for the hustle.
Speaker 2:What we really care about is that he's moving markets.
Speaker 1:He's moving markets and he's also moving views. He has pulled basically a billion views, become a celebrity overnight. He already had millions of followers on Instagram. It's now at 8.8. I'm sure if I open it up now, it's even higher.
Speaker 1:He posted what's interesting is that this broke containment. So this video, he's been posting on Instagram for years. Yep. This broke containment. It it hasn't
Speaker 2:been really You've probably seen some of his other videos where he's running Yeah. With the G Wagon. Yep. And it's
Speaker 1:Always always great, but this video was art, and so it broke out in a completely different way. It was actually not even posted by him on X. It was posted by tips for men, fashion, essentials, luxury. And it has almost a billion views, a hundred thousand quote tweets, something like that. And it's fascinating the way it's structured just to be the most viral thing possible.
Speaker 1:I mean Yep. He's obviously very muscular and jacked. And then you have this weird repeating like imagery of the Saratoga blue bottle of water that he loves. He dunks his face in ice.
Speaker 2:Which we figured this out, it's not, it wasn't sponsored by Saratoga. It was not. So he was just appreciating He's just a fan of it. Just appreciating business. Just wanted to put them on.
Speaker 1:Yeah. There's a bunch of other funny things where as you dig into the video, there's just more and more Easter eggs. Like he at at 6AM or something, he dives into the pool. But as he's walking up to the pool, you can see that there's a no diving sign. Did you see that one?
Speaker 2:I didn't see that. I saw that he was in the air for four minutes.
Speaker 1:That one's really funny too. Like the editing is genius and clearly the it's crazy because like the cinematographer and the editor on this is genuinely a generational talent in terms of social media.
Speaker 2:You don't think it's him?
Speaker 1:No, it's not him. He has a team. Really? Yeah. Yeah.
Speaker 1:Yeah. Oh, okay. Yeah. He he has a team of like three
Speaker 2:I figured he was just setting up the camera No.
Speaker 1:You can actually see the other videographer in there because he has a team of like three people. And in one of his Instagrams, I I went on like a little deep dive. Yes. I I went on a little deep dive and he and he said like, if you want to be a successful online coach, he referenced Alex Ramosy and he said, you need to build a team. And of course, the product that he sells is help you build that team to become the fitness coach or the online influencer.
Speaker 1:Right? This is kind of like
Speaker 2:a meta level of He's the boss' boss.
Speaker 1:He's the coach's He's a course seller who helps you sell courses effectively. But he talks about you need to start by getting a social media team around you, a great person that can film you constantly so that you're posting every single day. Then you need a appointment booker who just schedules appointments with clients, like your leads. Then you need the closer who gets on with super high energy and is like, yes, like this is going to transform you, like get ready to put
Speaker 2:best But that's not you, the closer to No, he's not involved.
Speaker 1:And then they get them to download an app and then the app says here's where your workout routines are, here's where your diet is and then yes, Ashton will get on the Zoom call with you like once. But like he's scaling his business out and so he can't possibly be on Zoom with, you know, 50,000 fitness clients. But they can watch his content and they can be in his program that he's overseeing as essentially the CEO of this training corporation, which is probably doing fantastically well. He says he hasn't made $10,000,000 yet, but he is well into the 7 figures, which
Speaker 2:So he's not building in public? He's sort of like partially He's talking about it.
Speaker 1:Yeah. I mean, you never really know what these guys if they're lying, but I totally believe that he's making millions of dollars. Like I I think there's no question.
Speaker 2:It would be impressive if he wasn't making millions would be very
Speaker 1:hard. Selling. Deals.
Speaker 3:He has
Speaker 1:brand deals as well. I think he has a shoe deal already. And I wouldn't be surprised if Saratoga Water partners up with him as well because he's done fantastically for that brand.
Speaker 2:Face of Saratoga.
Speaker 1:The news today is that the morning LMAO, the morning routine guy really added 1,000,000,000 to the stock of the water he drinks. It's up 10% before hours. Saratoga is actually privately owned by another company, but people are still buying it.
Speaker 2:We bought some I'm just looking now. It's actually basically flat.
Speaker 1:I guess it
Speaker 2:popped out it popped out of the gates. The shorts sellers think
Speaker 1:that it's not gonna be Lindy. Yeah. So they stick around. It is a very interesting question of how do you seize the moment on mega virality? He is not like the Hawktua girl where he was unknown and then he went mega viral.
Speaker 1:He already has a machine to convert all this.
Speaker 2:Yeah.
Speaker 1:So I wouldn't be surprised if we see him do a whole host of of interviews and podcast tour off of this. He already has millions of followers and a complete funnel with a team where he can capture and monetize. I think that was part of the problem with Hayley Welch, the Haktua girl, was that she became famous and then had to go do podcasts and then go and set up a podcast of on her own and then set up a business around it and start making money from it. She wasn't equipped to capture all that attention and all that value immediately. And so that's why probably when she heard, hey.
Speaker 1:This crypto thing's interesting. She launched the coin, and then that went very poorly. So, Lulu, who will be on the show later today, says, she's sad to see the Saratoga x account sleep through this. Most posts most recent posts are from 2022, and they're hashtag soup. You're missing the moment.
Speaker 1:Get back in the game. You have three more hours before this vanishes vanishes into the sands of Internet history. And, yeah, they don't even have their most recent bottle design on there. It's rough.
Speaker 2:Pretty amazing. You can get almost a billion views at this point Yep. With, for free Yep. For your product.
Speaker 1:Yep. So my question for Lulu, which we'll get into with her, is does Saratoga actually need to do anything in this case? Like, if if case in point, like, the viral video of Ashton, the one that kicked all of this off, wasn't even posted by him. It wasn't even an example of him going direct. He posted on Instagram, tips for men posted it on x, and that's the one that went viral.
Speaker 1:Doesn't matter. The value still accrues to him. Does Saratoga need to We need to
Speaker 2:study the tips for men account because
Speaker 1:Oh, it's
Speaker 2:it's the
Speaker 1:Because they posted other stuff, and they get, like, 10 likes. And then this one was, this gimmick.
Speaker 2:It's one of those accounts.
Speaker 1:Yeah. It's just like it's kind of just like slop cool images sometimes, some interesting stuff. But, you know, it's it's very high volatility because it's just a an anonymous, like, out feed the algorithm account. So my question for Lulu is, like, what do we want to see exactly? Let's try and concretize that more.
Speaker 1:Because if Saratoga just came out and we're like we're like, oh, yeah. Like, this is cool. Like, you know, maybe that gets some virality, but it's not going to be a billion views. They've already got the billion views in their product. They've probably captured most of the value.
Speaker 1:Like what do we really wanna see from them? Is a company that's been in business since 1872. Let's remember. It's not like a founder's gonna come on and be like, oh yeah, let me get a whole This
Speaker 2:is a whole other story. But at one point, one of my favorite bottled water brands is Mountain Valley. Yeah. Popular, it's the green bottle. True.
Speaker 2:I looked, they like at one point like filed for an IPO or something like that and they didn't go public. So I looked at some of their numbers and however bad you thought the business of selling bottled water is, it's worse. Like they at one point with one of their skews did 10,000,000 of revenue. 10,000,000 at like, and they had a hundred thousand dollars in margin Mhmm. On it.
Speaker 2:Oh, that's rough. It's like just just don't 1% margin. Yeah. Stop yourself. Just stop stop that business activity.
Speaker 2:Know, there there's gotta be like better Yeah. Ways to make a hundred k.
Speaker 1:But Anyway, speaking of tips for men, I got a tip for men. We have need sleep.
Speaker 2:That's right.
Speaker 1:Nights that fuel your best day is turn any bed into the ultimate sleeping experience. If you're trying to wake up at 4AM, three AM, two AM, one AM, you're gonna need an eight sleep. It'll help you wake up earlier and get on your I
Speaker 2:actually did wake up on my eight sleep at 3AM this morning. Assumed it was time to wake up. I checked the clock. I'm like, I gotta go back to bed at least for an hour and a half.
Speaker 1:Well, I'm glad you were up early because you got to experience the stock market open, which was fantastic. Let's hear it for the stock market, folks. Let's hear it. It's fantastic. A massive rally.
Speaker 1:Stocks are up. The Dow gains around 500 points on tariff optimism. This is from The Wall Street Journal. Import investors are welcoming the latest pivot on tariffs, with The US set to limit the range of import levies it introduces next week. US stock benchmarks started the week solidly higher.
Speaker 1:The S and P inched up last week, snapping a four week losing streak partly driven by uncertainty caused by president's Yeah. And many many
Speaker 2:people are saying that this is related to tariffs, but, you know, on the other side of this, it is very possible that the market is reacting to Ashton's routine going viral.
Speaker 1:That's as
Speaker 2:you can imagine, if everybody just started, you know, started consuming products at 03:45 a. M. Versus waiting until It
Speaker 1:would be a big boost to consumer adoption.
Speaker 2:Yeah. Just just a big And consumer confidence for sure. Confidence overall spending.
Speaker 1:It is hilarious watching his routine and being like, this guy has been up for five hours and he still hasn't started work. It's like so much time
Speaker 2:before doing Yeah, I was, I got very Tim Ferriss coded in college and I would do the whole like wake up, meditate, breath work, journal. And then I was like, what actually makes me feel better about my is to just get the things that are important done Yeah. And be productive. And yes, be active. The whole like hour and a half like morning routine to start your day.
Speaker 3:Yeah.
Speaker 2:I'm much more of the mindset now. I just like to get up and start.
Speaker 1:Yeah. He's probably taking it a little bit too far, but I do I do think there is some truth in there. The the he actually laid out his reasoning for waking up so early and he said, like, you should be up from four to eight. You will be unbothered. There'll be no one else bothering you, you can really get deep work done, which is probably true whether or not it's just this crazy morning routine.
Speaker 1:But even if you're just answering emails, it's probably productive. And he was saying that you will be self selecting your you'll be selecting yourself out of the the, you know, 10PM to 2AM crowd which is usually filled with drinking and partying and all these things that kind of just set you back both physically and mentally. So I think there's some truth in what he's saying. And if you follow his protocol, I mean, yeah, it's going be a little silly rubbing banana all over your face. But you'll probably be, you know, closer to higher performance than be doing the opposite of what he's doing.
Speaker 1:Right?
Speaker 2:I think my point of view on it is that like it seems like willpower is one of those things that the more willpower you use, the more that you get. Yep. But it's almost, it's maybe not a perfect rule
Speaker 1:Yep.
Speaker 2:Because if you spent all your willpower in the morning like hammering through this like multi step routine and then you're like, you get to the email and you're like, actually doing my email is a lot less fun than like jumping in the cold pool. Yeah. Exactly. So maybe you should just start and do the stuff that takes a lot of willpower and then do the jump in the pool in the afternoon.
Speaker 1:Right? Yep. I mean, he probably could get 90% of his workout done in like an hour instead of five.
Speaker 3:Yeah.
Speaker 1:But I mean, he's a fitness guy. Like he he needs to be doing fitness Yeah.
Speaker 2:I also respect his game of of what is the most viral thing that I could do from 03:45 to then. It's fantastic.
Speaker 1:And it's it really is art and I think it's it's just shows you how extreme the power law can be on social media.
Speaker 2:I think that we should spend this week and make the TB version of I I like Roll it out.
Speaker 3:It's a
Speaker 2:good idea. By Friday.
Speaker 1:Well, back to tariffs, the important thing. Trump said he would impose tariffs to match those aimed at The US by trading partners. The planned reciprocal action looks set to be more targeted than originally thought, The Wall Street Journal reported. The administration has narrowed its focus to about 15% of nations currently running persistent trade imbalances with The US. Treasury secretary Scott Bissant calls this the dirty 15.
Speaker 1:The sectoral tariffs are now unlikely to be announced on April 2. Though the measures under consideration still amount to a shock to world trade, they fall short of the worst case economic scenarios investors had been girding for. And so, another classic economic story where the initial headline news is very bad and then pull back and then you get to something that's a little bit more reasonable. So, hopefully, it shakes out. Hopefully, all of the companies that we're rooting for get through it and are able to make their products in safe places and deliver them to consumers affordably.
Speaker 2:That's Well,
Speaker 1:if you're looking to trade the, tariff news or get in on the action, head over to Orhedge.com.
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Speaker 1:Investing for those who take it seriously, multi asset investing, industry leading yields, trusted by millions. Go to publick.com and sign up. Do it. Anyway, 23 filed for blank bankruptcy. Yep.
Speaker 1:We got some news from Delian, friend of the show. He says, out with the old, in with the new. Kian over at Nucleus is building the new twenty three and Me, and the old twenty three and Me has filed for bankruptcy. He Kian says, Blockbuster has collapsed. It's time Netflix to rise.
Speaker 1:The number one greatest detail with that is currently being missed from the story is the chart below. When 23 and Me launched in 02/2006, it cost about $10,000,000 to read all of someone's DNA, a whole genome test. So 23 and Me, hence, the technology twenty three used, missed millions of genetic markers that could dramatically shape someone's health and future family. 23andMe used something called shotgun sequencing that basically blast all the DNA away and use a and use a bunch of averages to guess what your genome's They don't actually read out a single strand of DNA. Yeah.
Speaker 1:And so now Which
Speaker 2:taking a shotgun approach to your health sounds a little bit bad when you say it out loud, John. Yep. So we're glad to take the sniper approach.
Speaker 1:Yes. Yes. And so now this whole genome test cost a few hundred dollars. We can now finally bring to everyone a true DNA health test, family planning disease risk, and he starts shelling for his company, which we love. So good luck to you, Kian.
Speaker 1:Let's read from the cofounder Annie Anne Wojicki. She says, the 23andMe special committee released news today indicating their plan to take the company through chapter 11. While I'm disappointed that we have come to this conclusion and my bid was rejected, I am supportive of the company and intend to be a bidder. I have resigned as the CEO of the company so I can be in the best position to pursue the company as an independent bidder. She wants it back.
Speaker 1:I love it. Nineteen years ago when I cofounded 23andMe, the direct to consumer industry did not exist and most people had no idea they would ever want to see their genome. So much has changed. There's now thriving direct to consumer industry. Over 15,000,000 people have been 23andMe customers.
Speaker 1:These customers are continuing to learn about their family relationships and how to optimize their health. Thanks to the incredible team of individuals at 23andMe. And this is a pretty interesting bidding process. So lots of people came out in support of didn't
Speaker 2:Kian submit an unsolicited sort of bid?
Speaker 1:He was talking about bidding months ago. We'll see what actually happens. I don't think he's quite at the scale where he could just buy this off of his own balance sheet. But Yeah. You know, he is a growing company and there's always a chance of a bigger round and
Speaker 2:Got a bunch of big investors behind him. It's possible.
Speaker 1:Yep. Balaji came out in support. Celine, from Loyal came out in support, talking about how inspiring the leadership at 23andMe has been. And it really was a formative company in the, you know, twenty tens, basically. What's interesting is that the, Will Menidas has been beating this drum for a long time about, hey.
Speaker 1:23andMe has a lot of genetic data. Let's not let this fall into the hands of an adversary country. So Yep. I'm sure there will be a lot of questions about who buys this and where the data goes. And if you're if you have 20 if you did 23andMe maybe, like, fifteen years ago as, like, a Christmas present, like, you might want to export that data and then delete your account and make sure that they remove it from their servers just so that your your data's not up for sale at some point.
Speaker 1:I don't know. It's not health advice, but it seems like a reasonable thing to do. And I do believe that if you ask them to delete your genome
Speaker 2:Well, that is the, I would imagine that the core asset value of the business is the genetic data of the 15,000,000 people that have used it or
Speaker 1:I don't even know. I don't think so. I mean, I think the core asset is really just like getting people to come
Speaker 2:You don't think
Speaker 1:so. Pay a hundred bucks for something.
Speaker 2:PE fund is saying, you know, look, we can buy this.
Speaker 1:We can sell it. PE funds are thinking that. I think maybe some venture investors might be thinking that in terms of let's train a custom l l. I think Kian is thinking that, but I don't think private equity is thinking that. I think private equity is thinking, okay.
Speaker 1:It has this much revenue. People kinda like, there's a thousand customers that come in every week and buy this thing that's a hundred bucks, and here and here are the profit margins. Can we strip out any of the costs? Can we actually make this work? I don't think people are are are thinking about this trove of genetic data because it's it's it's very hard to monetize at this point.
Speaker 1:It's not like, okay, Reddit is for sale and you can just take the Reddit data and immediately train an LLM and boom.
Speaker 2:No, there's going to be so much scrutiny on this acquisition and who buys it, what they intend to do with it. There's millions of Americans and I guess people globally that are going to be have have you know, wanna have a say in in what kinda happens.
Speaker 1:And so the Wall Street Journal reports that 23andMe said that there will be no changes to how it stores, manages, and protects customer data. Any buyer of 23andMe will be required to comply with applicable law with respect to the treatment of customer data, and then they immediately move on to the next segment, in this in this Wall Street Journal article. How do I delete my 23andMe account data?
Speaker 2:But saying
Speaker 1:And then it's very clear. It's like log in to your account, go to the settings section, click delete data, permanently delete data. So you can go do that if you want. Anyway, what will happen to the genetic data in a bankruptcy sale? Certain in certain bankruptcy cases, a judge can appoint a consumer privacy ombudsman ombudsman, who makes a recommendation on whether a bankrupt company should be allowed to should be allowed to sell consumers' private information.
Speaker 1:This happened when lab testing startup, uBiome, filed for bankruptcy in 2019. The court appointed one, who ultimately recommended approval of the sale of personal data. So watch out. Mike, your data's sold. Anyway, did you have something else to say?
Speaker 2:Yeah. I I I was just going to highlight that. It it seems like a very real possibility.
Speaker 1:Yeah.
Speaker 2:I I think that Anne would have come out and said, there is no scenario in which a company buys 23andMe to then sell your data to other companies. She would have been very explicit about that. Yep. So the fact that she's not being explicit about that and then they're highlighting this uBiome
Speaker 1:Case where they did sell the data.
Speaker 2:Case where they did sell the data.
Speaker 1:Yep.
Speaker 2:I would I would just I I think the the safe thing to do is assume your genetic data will be sold to the highest bidder.
Speaker 1:Yeah. And so if you're if you're particularly jacked and have great genetics and great muscle insertions, you should go and put your on 23andMe so it leaks out and then we can create more super soldiers.
Speaker 2:That's
Speaker 1:right. That's that's my recommendation.
Speaker 2:Huge alpha there. It's kind of like training an LLM. Yeah. You wanna put a lot of content online. Exactly.
Speaker 2:Put your genetic data in 23andMe.
Speaker 3:Yep.
Speaker 2:Do whatever.
Speaker 1:Wanna influence
Speaker 2:the next if you have to. Well,
Speaker 1:if you don't wanna go bankrupt, what should you do, Jordy?
Speaker 2:Run on ramp.ramp.com.
Speaker 1:Time is money. Save both. Easy to use corporate cards, bill payments, accounting, and a whole lot more all in one place. Don't go bankrupt, people. Manage your expenses.
Speaker 1:Manage your finances. Get on ramp. It's that easy.
Speaker 2:Anyway True. Is money.
Speaker 1:True. On to the the drama that's tearing up the timeline.
Speaker 2:Tearing up the timeline.
Speaker 1:The timeline is was really in turmoil this weekend. We got a post from Nico over at Default. He says, this is like Kendrick versus Drake for people who know React. And it's because Amjad, who's coming on the show, is beefing with Guillermo from Vercel, who's also coming on the show. And we will try and take you through a little bit of this back and forth.
Speaker 1:And I just lost
Speaker 2:power to my John needs a new battery. Yeah. So this you've got new batteries here. Right? You're good?
Speaker 2:Yeah. So this was tearing up the timeline over the weekend. We also tried to get the third third party
Speaker 1:We did. Show. Cloudflare CEO, Matthew Prince, you're invited on the show. Please come on. If not today, maybe later this week.
Speaker 1:But Amjad took some shots at Vercel. So basically, the the we we should start by setting the table with exactly what what's happening here. It all started because there was a a vulnerability found in Vercel. And so, Vercel is a, web hosting service for, Next. Js apps, which is a open source, React framework that they maintain.
Speaker 1:And so, research suggests that Vercel faced criticism for unclear communications about the vulnerability. The drama centers centers around a critical vulnerability, CVE 202529927 in Next. Js, disclosed around March 22. That's two days ago. Came out on a Saturday.
Speaker 1:And this allowed attackers to bypass middleware authorization checks. This affected versions of Next. Js using middleware with Next. Start and output standalone. But applications hosted on Vercel, Netlify, and Cloudflare were not as were stated as not affected.
Speaker 1:And so Vercel's CEO, Guillermo Rowe, acknowledged communication missteps, especially with key industry partners, and committed to improving processes. Cloudflare led by Matthew Prince released a tool to migrate product projects from Vercel to Cloudflare
Speaker 2:Savage.
Speaker 1:Possibly to capitalize on the incident. So he's saying
Speaker 2:I think a little bit more than possible.
Speaker 1:Beating beating them when they're down saying, hey. There's a there's a vulnerability. Get out while you can. Replit under Amjad Masad highlighted their proactive scanning and patching of affected applications while expressing a preference for more open frameworks over Next. Js.
Speaker 1:And then, of course, there was a there was a back and forth there because Replit uses Next. Js for their website. And and so I was like, how could you possibly come for us when you're using our open source framework? And so public exchanges on X saw Guillermo accusing Matthew at Cloudflare of using, quote, childlike tactics and memes suggesting competitive tension. The CEO of Cloudflare often refers to Guillermo as the triangle boy or something like that because No.
Speaker 1:I guess the the logo for Vercel is triangle. It's actually the the aesthetics of Vercel are fantastic. I I think we were talking about this earlier. The the design's fantastic. An ex post by Anselm IO noted attacks from Cloudflare and Replit on Vercel as being in bad taste indicating a broader controversy.
Speaker 1:Additionally, there was a mention of a significant customer switching from another company to Vercel, potentially heightening the rivalry. And so we can go into a little bit about, the the the history here, and I thought it might be good to give a little bit of an overview of Vercel and then Replit and then Cloudflare.
Speaker 2:Let's do it.
Speaker 1:Up our guest, which will be joining in twenty minutes. So let's kick it off with Vercel founded in 2015.
Speaker 2:Yep. One one other thing to highlight. Yeah. There was a post that you had flagged here from this guy, Jur how do you know how to say this guy's name? Gurgley Arose.
Speaker 1:Gurgley Arose. I'm sorry.
Speaker 2:I mean, I tried to say it right. John John made no effort. It looks like Gurgley. But Is
Speaker 1:that Gurgley?
Speaker 2:Gurgly or Rose. Up up to recently, if a vendor had an outage or security issue, their competitors would purposely not take advantage of this, would not bad mouth the vendor or tell customers to switch, at least publicly, Feels like this is changing. Ripplet and CloudFare are both doing this following the next JSCVE.
Speaker 1:Yep.
Speaker 2:And yeah. So anyways
Speaker 1:I was talking to a friend and he said open source and security fights always seem to lead to no winners and everyone looking worse.
Speaker 2:Yeah. One one thing that I feel like is potentially broadly happening in tech is when when when there was so much Internet to build and there was so many sort of like greenfield opportunities, it was very easy to have this sort of positive sum Yep. Mindset of there's plenty of market. We're just going after these sort of legacy incumbents. We're creating new markets.
Speaker 2:And then when you get into this sort of hyper competitive dynamic where there's a bunch of different substitutes, yeah, then you get like rippling deal Totally. Issues, right? Where it's like, yeah, we are going to spy and like try to steal customers Yep. You know, that that our competitors getting. So I feel like this is just the evolution of software broadly where in other industries, if a competitor has an issue, their competitors will try to highlight it and use it to their advantage.
Speaker 2:That's just business. Right?
Speaker 1:And it is it is a little bit it's not necessarily winner take all, but it is kind of zero sum in the sense that, like, you're either on Cloudflare or Vercel. In many ways, there's been this kind of upgrading process where maybe I mean, the the the story I think we'll get into is you prototype and build, like, kind of almost like a vibe code and app on Replit. Then you might take it a little bit more seriously and deploy something on Vercel, which is gonna be very fast, we'll talk about some of their clients. But mister Beast famously did a a merch drop on Vercel, drove hundreds of millions of of hits very quickly. Vercel was able to manage it, but Vercel is on top of AWS and can be very expensive, at scale.
Speaker 1:And so Cloudflare might be the cheaper option when you go a little bit more professional. And so they they play in similar markets, but they're all at different tiers. And and so they they like to chirp at each other, especially with the coming wave of, like, AI and vibe coding and even less infrastructure, more abstraction. It's it's they they clearly are all coming for each other's markets. And so over at WAP, Sharkey says the Vercel team has been a great partner to WAP Engineering.
Speaker 1:They are always available to debug and solve our complex critical issues. Recently, we've hopped on several calls with their lead engineers. They all care deeply about what they're building, excited for the future of NeXT. And Paul Graham came out in support of Vercel. Guillermo said one of our main values at Vercel, iterate to greatness.
Speaker 1:We're constantly learning, adapting, and improving. We have an insatiable appetite for feedback. The job is never finished. Keep your asks and complaints coming. We're listening, and PG says, a sign of a a sign of a company still run by the founder.
Speaker 1:What hired CEO would solicit complaints? And so I think I think Vercel's doing a pretty good job of of managing this, but it's getting it's getting a little nasty on the timeline, because people are are going back and forth. Anyway, let's give a little background on Vercel. Founded in 2015, Guillermo Rao. Oh, he created Socket.
Speaker 1:I remember this. Socket.io was a, what what was it? WebSockets framework for doing communication in the browser in real time. So you open a socket from my computer directly to yours. So instead of going through a server and kind of round tripping, I can communicate with you directly.
Speaker 1:Great for chat apps, great for video and and anything where two people are communicating directly. Lots of cool web apps came out of that at around this time, 2032, '20 '15 era. He found ZEIT, which was the precursor to Vercel with co founders. The mission was to simplify global cloud deployments and streamline developer workflows. So at the time, you go to AWS and you have your application.
Speaker 1:When you open up AWS, you see a slate of like 75 different products that AWS has. They have databases, servers, cloud storage, S3, like long term storage, cold storage, hot storage, like all these different things. And you have to decide what you need to build your app. And so it's an infrastructure as a service infrastructure first product. Now, they do have Vercel competitors.
Speaker 1:They have Heroku, which is kind of a Vercel competitor in the sense that
Speaker 2:you Yeah. To be clear, it feels like
Speaker 1:I
Speaker 2:mean, Vercel ate Heroku's lunch.
Speaker 1:Yes, it definitely did.
Speaker 2:There was an era where it feel like every Y Combinator company was on Heroku.
Speaker 1:I built on Heroku, was great.
Speaker 2:And then it was, okay, everybody's building on Vercel And
Speaker 1:basically, it's a more expensive option, but it allows you to come product first. I just wrote the code, and I want you to handle the scaling, and I'm willing to pay hand over fist for it. It'd probably be a lot cheaper to go direct. And it's even cheaper to go below AWS at a certain point. You wind up like these big LLM foundation model companies are building their own data centers right now.
Speaker 1:They're out renting those from AWS because you save money as you go down the abstraction layer, but you lose flexibility. And so, early product launches in 2016, they launched now a one command development service for static sites and Node. Js apps. In twenty sixteen, October, they released Next. Js one point o, which was an open source React framework for server side rendering and static sites.
Speaker 1:Now React, there's a whole battle in JavaScript frameworks around this time. I don't know if you remember this, but jQuery was like the popular JavaScript framework. People were debating, should we use jQuery or Vanilla JS? And the JS frameworks got more and more bloated. Google came out with this great one called Angular, which was it had basically the model view controller.
Speaker 1:You could basically say, on my front end, I have an idea of data. On our website, you have all of our sponsors listed there. And there's like a row for ramp and a row for bezel. And you pull those in. Then as you're dynamically changing them, the front end's updating.
Speaker 1:Angular was really cool. It allowed you to you had to learn it, but it was pretty performant. And then Facebook came out with React and just ate their lunch. And Angular went through the second version. They came out with a new version.
Speaker 1:It was much more complicated to use, in my opinion. And so React really took off. Next. Js is a framework for React, so they're layering on top here. And they wound up building an ecosystem around immutable deployments, preview environments, and serverless architecture.
Speaker 1:So the idea that you don't need to think about what's happening on the back end. And if a million people show up or a thousand people show up, Vercel will just send you a bill that scales, but you don't actually have to go in and say, okay, I need a hundred servers today instead of one. That's the whole that's the whole pitch. And so in 2020, they rebrand to Vercel and they wanted to reflect a broader focus on developing preview and shipping. They retain the triangular logo while adopting a name that suggests versatility, acceleration, excellence.
Speaker 2:I gotta say, Vercel's website is the fastest site in the West. It is hilariously quick. It puts every other site to shame.
Speaker 1:It's really great.
Speaker 2:And they're they're obviously just like flexing the power Totally. Of their product. But go to vercel.com and just click around. It's almost addicting. I figured out these
Speaker 1:CDNs and you can basically build the entire app and then deploy it onto a CDN so that when someone hits website for the first time, they're not pulling it from your server on AWS in Virginia. They're pulling it from the local server that's just like a couple blocks away from them, it's much faster. I was really hooked on it. But at the time, if you wanted to deploy your whole site to CloudFront, which is AWS's product, or Cloudflare, which we'll talk about later, it was a lot of work. You had to bake everything down into HTML and make sure it was served just like a single file and there were no server calls.
Speaker 1:And it was very difficult, but it was a magical experience when you click on the link and it just loads immediately. It's amazing. Let's go through some funding milestones. Vercel does a Series A. So they were kind of grinding for like five years doing this open source stuff in
Speaker 2:the next This is ten year old company.
Speaker 1:Ten year old company. But in 2020, things start working. They rebrand. They raised $21,000,000 from Excel and Nat Friedman. What do you know?
Speaker 1:He's in there early. Of course, GitHub.
Speaker 2:Classic.
Speaker 1:Goat. Series b, he they they get 40,000,000 from Google Ventures. Series C
Speaker 2:That a that A was a COVID round too.
Speaker 1:Yeah. Oh, yeah. Yeah. I mean, maybe announced. Maybe
Speaker 2:No. I'm saying if it was announced in April, it was getting done. March maybe? Yeah.
Speaker 1:Well, in series C June 2021, dollars '1 hundred million at $1,100,000,000 valuation. Series D, just six months later, they get $150,000,000 from GGV Capital. The valuation goes up to 2,500,000,000.0 And then in Series E, just last May, '2 hundred and '50 million from from from Excel. Company valued at 3,250,000,000.00, and they hit over a hundred million dollars in ARR, and they have over a million monthly NextJS users. And so we can go through some of their technology.
Speaker 1:They've, you know, they've built their whole their whole game plan is build Next. Js into the best React front end framework that everyone kind of needs to use. This is a cut That is a controversial statement. There's a lot of Next. Js haters out there that say, hey, you should just be writing React.
Speaker 1:Why are you messing around with Next. Js? It's going to lock you in a box. And then there's a lot of people that might say, hey, you could use Next. Js, but why don't you just host it on AWS?
Speaker 1:Just figure it out. Figure out the actual implementation. And so they also launched the vZero tool for generating UI components. They wound up partnering with AWS to bring in some AI features, which we'll need to talk to Guillermo about. And in January 2025, they acquired Tremor, a React component library for data dashboards.
Speaker 1:And so, they've, you know, they've built their team. They've made some acquisitions. They've done some partnerships. And now they have a pretty diverse, list of customers, Airbnb, GitHub, Uber, Nike, Washington Post, Under Armour, Fanatics, HashiCorp, SentryOtho, OpenAI, Perplexity, Chick fil A, reduced build times
Speaker 2:There we go.
Speaker 1:From twenty five minutes to five seconds. Wow. You love it. You love to see it. Wow.
Speaker 1:And and Stripe developed a viral Black Friday promotional site in just nineteen days. You'll love to see it. And MrBeast, as we mentioned, also.
Speaker 2:Absolute dogs. Yeah. I think most of the sites that I've been involved with building over the last few years were Vercel Yeah. Based.
Speaker 1:No, of course. Because you want to just get your product out quickly, worry about the scaling later. And at the low end, optimizing your infrastructure is just not a key cost. Like, the server bill is going be so much lower than what you spend on designers or implementations. So you should just be able to not really worry about optimizing your infrastructure or your servers.
Speaker 1:And that's kind of where Vercel is. I'm very interested to hear where Guillermo is planning to take the company because now they're talking about, well, we're going to host anthropic APIs. We're going to host LLMs at the edge and deploy and scale those for you. So you should, in theory, be able to have a front end website that has an interaction with an LLM, and it's not needing to go call back to some Anthropic server. Because one of the most time consuming things if you're wrapping one of these APIs, if you're an API if you're a a wrapper is, okay.
Speaker 1:I take the user's request. The user said, you know, write me a funny joke. I take it to my server, and then I take it from my server over to OpenAI server, and then I get a response from OpenAI back to my server, back to the client. And that's that's just extra round trips, and Vercel's all about speed, you can't have that. It's unacceptable.
Speaker 2:That's right.
Speaker 1:Well, let's should we move on to a company that's been going even longer, I guess? Or, I mean, I guess the story has been going on for longer. This is Replit. They were officially founded in 2016, basically the same year as Vercel. Very different product approach.
Speaker 1:But Amjad Masad has been in the development technology world for years. In 2019, he wanted to build a browser based coding environment, a Google Docs for coding. He envisions a REPL, which is a read, evaluate, print loop running entirely in the browser. Normally, you have to open up the terminal, get install Python. But what if you could just do all this in the web?
Speaker 1:It would enable you to share these and then obviously, like, add a bunch of features over time. So he released an open source version in 2011 called JSREPL to allow interactive coding in multiple languages. Brought some people on the team, brought some design stuff, and then he worked for companies like Codecademy and Facebook. He built development tools there. Then JSRapple used, used to power in browser tutorials at Udacity and Codecademy, proving the concept's value.
Speaker 1:So if you go to Codecademy and you were learning Python or learning JavaScript, you would be able to write the JavaScript and then also evaluate it and run it in the browser Yeah. Which was which was very fun and it definitely helped people learn this stuff. And so the platform grew to over a hundred thousand users, primarily students and self taught coders. He founds Replit in 2016 with some cofounders initially bootstrapped with personal savings and early community tran traction. They received seed investment from Bloomberg Beta and initially targets both the education market, coding classes, and hobbyist developers.
Speaker 1:And so Replit has always been about like democratizing programming, less about, hey, let's abstract away the complexities of AWS infrastructure. It is abstracting away complexities, but it's taking a much more product focused approach. And that's led to fans basically. Lot of solo developers, indie developers have really come out in support of Replit throughout the years. PG's been a big supporter.
Speaker 1:And so in 2017
Speaker 2:Yeah, it's interesting, both these companies felt like they exploded onto the scene in that 2020 era. Totally. Actually had been toiling away for almost more than a decade before that. So it was like these sort of like ten year overnight successes.
Speaker 1:I mean, didn't get into YC until winter twenty eighteen. And, but then once he was in YC, he quickly closed a 4,500,000 seed round from Andreessen. They surpassed a million registered users and developers started launching hundreds of thousands of projects. And so the focus is really on these interactive multiplayer coding, kind of like Yep. Figma for software development, writing even back end code, any scripting, multiplayer functionality was really new.
Speaker 1:There's GitHub integration and support for many programming languages. They raised 20 million dollars The big moment
Speaker 2:really came in 2021 when they got the .com. Absolutely. That that just really
Speaker 1:put turning point. You know? March 2021.
Speaker 2:The table saying, we're here.
Speaker 1:.Com, moving away from the .IT.
Speaker 2:Go to snag.com and reach out to our friend Rob if you want a great domain.
Speaker 1:I love it. So they upgrade the from the Ace editor to Monaco in 2017, later transitioned to CodeMirror. The move to CodeMirror sparks community backlash, which is later resolved with rapid bug fixes. There's series b funding in 2021, another COVID round. I remember when these were happening.
Speaker 1:He raised 80,000,000 at 800,000,000 valuation. The user base exceeds 10,000,000. Infrastructure is scaled to handle massive growth. And there was always this question of like of like, is Replit for learning and testing? Or will someone actually build a real business on top of a Replit app or something that they develop in Replit?
Speaker 1:Is it more for for practicing and prototyping? Is it a tool or is it an an infrastructure? And I think as we talked
Speaker 2:in the Yeah. What is the long term customer base going to look like? Right? It is it the, you know, indie hacker who wants to create their first one to 10 apps? Or is it somebody who's if you look at their website now, it's really oriented around this this similar thesis like Lovable, which we talked about with Harry last week, turning your ideas into apps with AI.
Speaker 2:What do you want to create a website for your dream business, a habit tracker, an education app for your kids, etcetera. So kind of, you know, long term this feels like the the user base could and and he he might not like me describing it like this, but it could look like something like what what Squarespace did for websites. Hey, anybody can make a website Yeah. And other platforms like that. But more so with anybody can make a website that actually has like crud app
Speaker 1:Totally, full functionality. No, I I mean, I think that's that's what all these companies are fighting is that everyone recognizes that that's a huge opportunity and whoever gets to it first and becomes the portal for making new websites is going to be extremely valuable.
Speaker 2:But at the same time, Vercel is very much also competing with Cloudflare and over the enterprise and moving up market and moving into these other use cases.
Speaker 1:Yeah. And so Amjad and Replit have launched a few things over the past few years. They had a bounties marketplace for freelance coding tasks. You could just put up a bounty and say, hey, I need this built. Remember that.
Speaker 1:And they had this massive community of like kind of indie hackers, kids Yeah. Who are learning.
Speaker 2:It was like, okay, let's give people their their first time making money with code you know, by writing code.
Speaker 1:Yeah. I I thought it was a really cool a really cool thing. In September of twenty twenty two, they debuted Ghostwriter, which was a competitor to GitHub Copilot, something to help you AI powered coding assistant, essentially, fancy auto complete, but extremely valuable in the context of Replit. And then they partnered with Google Cloud in March of twenty twenty three and quickly re secured a 97.4 series b extension, reaching a $1,160,000,000 valuation. So up there with Vercel in the unicorn club, they continued rapid growth to over 20 to 30,000,000 users.
Speaker 1:And then they fully removed the education product. The free starter plan limits new users to three public project projects. And they're kind of going up market trying to be more serious in, like, the business world. Yep. They relocated their headquarters from San Francisco's SOMA to Foster City, and now they are over to a 50 employees with a sharper focus on professional and enterprise development.
Speaker 1:It says they remain committed to innovating in cloud IDEs and AI powered coding tools guided by the founder's original vision. And so that's the story of Replit. We have four minutes. Should we try and do some Cloudflare? We got the biggest one yet, but we can kind of rip through this.
Speaker 1:Cloudflare Let's do it. Found in 02/2009. Oh, wait. We got Guillermo on? Okay.
Speaker 1:Let's just bring him in right now.
Speaker 2:Let's do it.
Speaker 4:Cloudflare
Speaker 1:after. Welcome to the show. How are doing?
Speaker 2:My man.
Speaker 3:Great. Thanks for having me. I've been looking forward to this.
Speaker 1:Me too. I think everyone's looking forward to this. There there's drama on the timeline. We need to have a TVPN segment. We really appreciate you coming on.
Speaker 1:Can you, can you just give us, like, a breakdown of what's happening in the world of Vercel right now?
Speaker 3:Well, yeah, maybe to introduce Vercel too for those that are that are new to our company. Vercel creates frameworks and infrastructure to deploy great web applications. We're super invested in open source. We created a framework called Next. Js
Speaker 1:Yep.
Speaker 3:That powers a lot of the Internet, and we're very proud about it. But we also have investments in a bunch of other open source projects.
Speaker 1:Mhmm.
Speaker 2:I have a
Speaker 3:long history of being involved in the JavaScript ecosystem, TypeScript ecosystem. So if you're building a new application, Vercel and Next. Js are are a pretty good choice for people.
Speaker 1:Fantastic. And what's going on most recently?
Speaker 3:Yeah. I mean, if you go to Next, there's a lot going on. Maybe the thing that started a lot of this was we got a ping from a security researcher
Speaker 1:Mhmm.
Speaker 3:About a, potential security vulnerability on Next. Js. We get lots of this, operating at the scale that that we're in. We have millions of monthly active developers on Next. Js, tens of millions of applications deployed to the Vercel platform.
Speaker 3:And so we get we get a lot of things, but this one in particular was interesting because it was a potential auth bypass, which, you know, in the security industry, it's as bad of a bug as you could imagine, like, bypassing login sign up, things like that. We took a look at it. We we, process it through the queue. We remediated it. And then when we disclosed it to the world, you know, we we we could have done a lot better in how we disclosed it.
Speaker 3:So, we we filed a CVE in partnership with GitHub Mhmm. Which is the standard mechanism of how you notify every Next. Js user on the planet, whether they use Vercel or not about this this vulnerability. But the awesome thing about Next. Js is that once you use Next.
Speaker 3:Js, you're actually not just getting the open source project in Next. Js. You're getting a huge ecosystem of of products with it that you can use and integrate really nicely into Next. Js. There are lot there are a lot of auth partners, a company like Clerk, StackOft, BetterOft, Lucia in the open source ecosystem.
Speaker 3:It's these awesome products. And I think we should have notified those people before that CVE went out so they could have had the opportunity to, like, look at what the impact would have been to their projects and things like that. On the other hand, we did test internally, like, okay, is Netlify, which is another deployment option for Next. Js, affected? And, again, we could have done a much better job at partnering with companies like Netlify and and Cloudflare who host Next.
Speaker 3:Js as well. But it kinda became, a Twitter thing, you know, that, like, it it it it got big, and then, Cloudflare got involved. I think you guys were just talking about it before I joined. And, yeah, there's some banger tweets being exchanged here and there.
Speaker 2:Yeah. You're entertaining. I'm I'm curious to get your read on it. You've you've been in the game for you know, you founded Socket back in the day. Do you feel like the environment now there's let you know, there's still a lot of Internet to build and there's still a lot of opportunity.
Speaker 2:But at the same time, we have these sort of scaled businesses like Cloudflare and Vercel and things like that. Do you feel like the environment today is like more hostile or emotionally charged than ever before? Because there's, you know, people are, there's now, like, sort of, like, the market's established in many ways. It's not maybe going quite as quickly as it used to. There's new opportunities, but it's yeah.
Speaker 2:It's like, it's it's started you know, is is this sort of more zero sum environment making things a little bit more charged today?
Speaker 3:I think not. I do think that on x, people get really spicy. I was very shocked that the CEO of, Cloudflare came I mean, he's he's the CEO of a public company, and he came guns blazing, even putting out, like, some, like, cringe worthy memes against Purcell, which is a company that is very developer loved. We invest not just in Next. Js, but we power, for example, the AI SDK, which is the most popular way today in the JavaScript ecosystem to add AI to your product.
Speaker 3:It has a million downloads a week. It's provider agnostic. It's develop deployment platform agnostic. So to come after in in such a, aggressive way, I was I was a little taken aback. Our style has always been if you look at my ex feed, the thing that I love to do is highlight great products.
Speaker 2:Mhmm.
Speaker 3:If you create anything great, especially if you use an X rays, I I just love to say, like, look at this really cool thing. Yeah. Yeah. I never talk about competitors. I never, especially, like, in in in a diminishing way.
Speaker 3:Sure. But in this in this case, I had a reply because because he's because he's saying, oh, if you want security, come to Cloudflare. And the record shows that if you if you want security protection, come to Cloudflare. There's a very mixed bag there. Mhmm.
Speaker 3:Right? There's a mixed bag, and, like, I had to recover from the from the annals of Cloudflare. I did bring up cloud cloud lead which legitimately was one of the worst thing that has happened to the Internet. You could I don't know if the audience knows, but you could Google and literally find off tokens of different companies like Uber indexed by Google. So that was an and by the way, our bug was bad.
Speaker 3:I'm not here to say, like, oh, like, whatever. Make excuses for middleware or whatever. Our bug was really bad, but theirs was catastrophic, and you could and the attack the impact of the bug was googling. It's, like, accessible to every the impact of our bug is actually very, you know, nuanced, and I'm super thankful to the researcher. Mhmm.
Speaker 3:Because it takes a lot of, like, thinking and reverse engineering to arrive to these conclusions. But, yeah, to your point, I think that it was uncalled for. We've tried to I think and that we could get into, like, the speculation of why he would do such a thing. We tried really hard to use Cloudflare. We were a customer.
Speaker 3:We tried it out for a new compute product, which coincidentally was edge middleware, and it didn't work out for a number of reasons. Mhmm. So maybe there was some soured relationships there as well that, you you know, we we had a piece out of the of Mhmm. As a customer, we had to build our own, but I can only speculate.
Speaker 2:Let's let's get into more of the positive and talk about kind of the future and and what the biggest opportunities, you know, that you feel like Vercel has in this sort of new probably the most, you know, most exciting time of of my life. John's, you know, few decades older than me. So I I
Speaker 1:don't if he's in Internet and AI.
Speaker 3:It really is.
Speaker 2:I imagine a pretty point. Yeah. Let's let's kind of ignore the drama for a second, and we'll talk about Yeah. The future.
Speaker 3:Everyone loves drama, but my message to all of the vendors and partners and people in the ecosystem would be the pie is about to get as large as we've ever seen in the history of technology.
Speaker 1:Mhmm.
Speaker 3:Purcell doubled the number of sign ups year over year, mostly due to the introduction of v zero Mhmm. Which is our coding agent. I don't think we've ever seen a technological platform shift of this dimension, where every piece of software will be rebuilt and reimagined with AI. And the pie is about to get so big that being paranoid about the size of your slice and taking cheap shots at your security competitor, to me, does signal shortsightedness on this AI opportunity. In fact, the AI SDK is powering competitors to vZero.
Speaker 1:Mhmm.
Speaker 3:So today, we, one of our one of our partners announced, new dot email. It's like the b zero for crafting email campaigns, all built on open source technology that we've sort of taken from b zero and given back to the world. Mhmm. And so and I also had a, you should check it out. I had a banger ideas thread on X the other day.
Speaker 3:Every single day, I'm thinking, here's a bunch of ideas of amazing products that you could create with AI that customers are so willing to buy. I just actually interviewed, we're at a company off-site slash Ordbo, and I interviewed one of the greatest public company CEOs of our times. I can't disclose who. Mhmm. And I asked him, what are your priorities for AI?
Speaker 3:He's like, oh, we're completely reimagining the company across these three dimensions with AI. I wanna buy AI for this, AI for this, AI for this. So to your point about the positivity is there is room for everybody. There's all this amazing open source technology that you can use to create new products and new ideas. I also believe part of my optimism is that in the beginning, two years ago, the there was maybe a belief that there was gonna be one gigantic chatbot to rule them all.
Speaker 3:Like a sci fi movie, you go to one computer or you talk to the room. Hey, computer. Everything is computer. Or what I believe at the time, and we actually this is why we started creating a lot of open source technology, that it's gonna be expert AIs, focused products that cater to specific requirements. And that's actually what's ended up happening.
Speaker 3:Right? So on Vercel, we host companies like Open Evidence, which is the charge for medicine. Get gc.ai, which is, the charge for lawyers. Amazing products for finance like Hevla. So what's actually ended up happening is that there is a redistribution of wealth, so to speak, that's happening with AI.
Speaker 3:There's also they call it sometimes the unbundling of Google. It's no mystery that a lot of companies or a lot of consumers, sorry, are not going to Google for certain queries, and they're going to specialist products to answer like, when I think knowledge, I may go to Perplexity or I may go to Grok and do a deep search. Right? So that unbundling of the one of the largest companies and and, information technology services in the world will create massive opportunities for startups and companies of all sizes. So I really do think I share your optimism and and positivity beyond the drama, that that happened.
Speaker 1:One thing I always think about with Vercel is just, like, the focus on speed. I feel like that's almost, like, the core brand tenant is just, I mean, Jordy pull up Vercel.com. It's like it's so fast.
Speaker 2:Is there a
Speaker 1:is there a brand? And I wanna know what's the importance of, like, speed in AI deployments?
Speaker 3:Oh, it's dramatic.
Speaker 1:I know you're hosting AI, but are you hosting AI at the edge or kind of delivering it in, like, a like, a CDN? Like, how how does that work, and how does that what impact does faster AI usage, happen in, like, the consumer experience?
Speaker 3:There's a couple of things if you're running a business that you should know right off the bat. Number one, a lot of traffic will shift towards answer engines. Mhmm. I reported recently that we see, 5% of our Vercel sign ups that also happen to be some of the highest intense sign ups coming from ChargebeeT
Speaker 1:Mhmm.
Speaker 3:Which is up from being, like, 1% or less than one percent six months ago. And it's growing. I didn't share the growth metric, but I'll share it now for you guys since I like you.
Speaker 2:Screw you.
Speaker 3:I got 3030% month over month.
Speaker 1:Wow. That's insane.
Speaker 2:So Wait. So so so
Speaker 1:so walk me through that. It's people going to ChatGPT asking, how should I deploy this? How what should I build? It's recommending That's correct. Recommending Vercel.
Speaker 3:Sama had a really good take. And and, also, if you wanna see a fast website, I am very proud that we host OpenAI.com. Sama recently shared, you might not wanna learn so much coding or only coding. Mhmm. You might just wanna learn how to use AI, which one of the artifacts of that and I love the Claude artifact name, I think, was one of the most important inventions as it have has happened in AI in recent years, is that coding and writing code is an output of what you ask the AI.
Speaker 3:So what's happening is people are asking, what is the best way to build a website? What is the best way to deploy? I actually posted so we have a little tool, a little playground. You can check it out. It's sdk.percel.ai, and you play playground.
Speaker 3:You can ask a bunch of models what they think about you, and that'll give you a glimpse into how the AIs are thinking. But not only how they're thinking, how they're directing the world's behavior and choices. I was very proud to share a screenshot that I asked, like, four frontier models in parallel, what's the best way to deploy? And they all said Vercel. And I actually constrained it to, like, you can only you know, like, the classic thing.
Speaker 3:You can only do one thing or Yeah. Yeah. Yeah. Myself. Like, okay.
Speaker 3:Vercel. Vercel. Vercel. Vercel. And so to me, that was I actually didn't know at the time.
Speaker 3:I was just, like, like, messing around in the weekend with the tool. I think that's the canary in the coal mine of how you should be thinking about AI sending traffic to different places.
Speaker 1:Mhmm.
Speaker 3:The consequence to our business is, number one, SEO still matters.
Speaker 1:Sure.
Speaker 3:So one of our one of our customers, for example, sponsored this fantastic show, Ramp.
Speaker 1:Let's go. They're in
Speaker 3:the business of being found. And so it's gonna be through Google searches, or it's gonna be through these agents. Mhmm. And so the agents are super forming a web search. So you still wanna be in good terms, so to speak, with the people that are, like, retrieving and crawling the Internet.
Speaker 3:Right? So that's one thing, and Vercel really helps companies with SEO. That's an interesting
Speaker 2:thing to think about.
Speaker 3:Yes,
Speaker 2:sir. Like, it's interesting to think about Google over time. If nobody's searching on Google, they just every link is paid for. Yeah. And they sort of still have this sort of like I
Speaker 1:do wonder if it's has the train left the station on SEO, or is there still an opportunity for new companies to kind of bootstrap their way into AI recommendations? And I also wanna hear your second point. Sorry for Yeah. Cutting you off.
Speaker 3:No. No. It's it's totally fair. So I think what's still relevant is that quality content. Facts.
Speaker 3:Yeah. Proof. These agents will be I actually like also Elon's truth seeking AI goal because it really matters that you train a model that is subjective and is post trained on truth seeking. Mhmm. Right?
Speaker 3:During the pretraining, you throw a bunch of data at it. During post training, you, like, sort of, like, orient its behavior. This model so this is why I'm a big fan of open AI in the sense of open source and also in giving developers choice. Mhmm. The AI SDK lets you very quickly swap models.
Speaker 3:Mhmm. I think it's gonna be very important as a community as I'm not talking about entrepreneurs or business people. I'm talking about as citizens of the Internet, we have to be very vigilant of the behavior of models, the decentralization of AI. Something that Vercel deeply believes in is and we have a we have a template you can you can clone. You can basically roll your own ChatGPT within two clicks.
Speaker 3:And we recently partnered with x AI to power the default model. So you can go to Chat.Vercel.ai, and you can basically clone and deploy your own ChatGPT in your own domain name. So what would be great for society is if we all invest in massively decentralizing intelligence so that we're not at the behest of, like, the one truth center or or truth, company of the world.
Speaker 1:Sure. Sure.
Speaker 2:Yeah. I mean, it's one kind of question that comes to mind. So you guys are powering openai.com. And openai.com somewhat recently is like very much reoriented around being a sort of like, you know, search Yes. Bar answer engine.
Speaker 2:And OpenAI right now is being priced like it's the next Google. Right? At at $300,000,000,000 plus, like, is the next Google. You talked about
Speaker 3:sort of the By the way, one comment on that, because it's been super double mind. I actually think that's a brilliant design. So I talked about how every piece of software will be rethought Mhmm. And rebuilt as an AI product. What people will expect is that when they go to your product, there is an interface like that.
Speaker 3:And I actually think that's really good design because they blended marketing content, which is what typically we think of as a website. I sometimes dismissively call them e brochures Yeah. To remind remind the team that we're not in this world to take a magazine and plaster it on the Internet. Yeah. The whole point of Next.
Speaker 3:Js and Vercel that we bet on 10 ago was a more dynamic web, a web that powered products. Mhmm. And so what's brilliant about that design is that you're immersed immediately into the product experience, and it's AI native. And I think that's just a sign of things to come. You're gonna go to so many other products.
Speaker 3:I mentioned the email one, but and OpenEvidence is so many of those where the interface will be, okay. What do you need? What do you want? When you go to v0.dev, the question that we ask is, what do you want to ship? Because we want you to convert an idea into an application.
Speaker 3:So talk But yeah.
Speaker 2:Talk about, the line between, developers and nondevelopers. Right? It seems like it's sort of blurring today. Vercel's entire brand has been around building building products for developers. That is the core of the mission.
Speaker 2:But is there a point in the future where, and you have your coding agent now. Right? There's there's this full sort of, like, stack. Is there a world in the future where, you know, you land on vercel.com and somebody Yes. That's not a developer can just type in
Speaker 1:This what you wanna build. A prompt.
Speaker 2:Right? Because like Yes. It seems like, you know, part of the drama, if you extrapolate it out, it's like there's, you know, real
Speaker 1:Whoever becomes the aggregator for building new websites and apps will be incredibly valuable.
Speaker 3:Yeah. That was gonna be my third point, actually. So the other huge opportunity for us is what we call agentic deployment infrastructure. Mhmm. So there's gonna be all of these agents that create for every user on the planet.
Speaker 3:And also to your question, I think that the TAM of what a developer is is going to still I mean, we're already seeing it in the numbers. I'm already seeing it in the customer interviews. I was chatting with a lady yesterday on the x platform, the everything app. She was reporting feedback about v zero. And at one point in the conversation, she was like, by the way, I do wanna be very clear.
Speaker 3:I have no idea how to code. I use v zero, and I and I think I get stuck, and I need some other like, another, another expert's opinion, like, go to another doctor. I ask Rock, and she brings it back and forth between the two products. And she's creating the reason that she was giving me feedback is when she was saying, like, the app has gotten so big. What do you recommend?
Speaker 3:And so people are, like, just having the the best time of their lives being able to create when they couldn't code before. But going back to the agentic infrastructure, think of it this way. VZero is automatically calling out to Vercel to create deployments to assign domain names in the future to even buy domains. Visio may even just say, hey. I thought of a banner domain name for your product.
Speaker 3:What do you think? And so we we're very excited to see the growth of this infra. And and by the way, the there's a defensibility to it that's really interesting, especially for people that are working in infra that are that are listening to this call. I I'm very convinced that by the coding will eat a lot of the world of creating front end applications.
Speaker 1:Mhmm.
Speaker 3:Meaning, these AIs are so good at writing React and Tailwind and Next. Js. It's actually shocking to me. And I've been a front end engineer. I started front end engineering when I was 11 years old in Argentina.
Speaker 3:And so I had my ego tied up to this thing of writing front end code. I contributed a library called Mood Tools when I was 15 years old. Six I was like, like, the the kid that could do front end. And and now I'm ready to, like, give up on part of my identity of, like, hey. V zero is creating an opportunity for a lot more people to be like me and experience that joy of creating frontends.
Speaker 1:Totally.
Speaker 3:Now what I'm not so sure about and you've seen all these conversations on x about security and Vibe you can Vibe code, but it's hard to Vibe debug.
Speaker 1:Yeah.
Speaker 3:I build I believe that you don't want AI in your infrastructure just yet.
Speaker 1:Mhmm.
Speaker 3:We operate in 20 regions worldwide. We reach dozens of cities through our pops in our CDN network. We have to maintain uptime for the world's most valuable properties from, you know, AI companies to cryptocurrency companies, some, presidential meme coins, whatever you think of, so much is going on on Vercel. Every second of uptime, everything that can happen to this platform is absolutely mission critical. Life critical.
Speaker 3:So many health care companies banking on Vercel. And so I don't want AI to necessarily messing with the foundational sort of infra and software that needs to ensure that these things run perfectly, that the train runs on time. On the other hand, and this is why Karpathy, I think, pointed by coding, when you're exploring, when you're creating, when you're designing, when you're crafting the interface, that's where AI is completely dominating.
Speaker 1:Makes sense.
Speaker 3:And now it's gaining full stack powers where you can integrate with that infrastructure. So we recently partnered with companies like Subabase and Neon and Upstash that they also hire those infra engineers that, you know, they might be using some AI, but, you know, hopefully, for our partnership, they're very careful. And but and and the and that creator that new creator is getting the best of both worlds, that you you vibe code and you're working on rock solid foundations.
Speaker 1:That makes sense. Can you talk a little bit about, accrual in AI? I know that there's been this debate over the model layer or the application layer. You could even abstract that, and now people are just saying, I either wanna be the aggregator, the ChatGPT app that's installed in a hundred million phones, or I wanna be an energy and get me get me shares in a nuclear company because I think everything else in the middle is gonna be commoditized. You don't have hardware yet or or or your own infrastructure.
Speaker 1:Does what you're seeing in AI change any of those decisions over time? How are you thinking about just the different opportunities? It seems like you're obviously going upmarket to be more of a aggregator where you could come to develop apps, but are you thinking about going down the stack further, build training your own models, developing your own chips? Or, like, what does the far future look like for Vercel?
Speaker 3:I really believe that the best metaphor for AI is what happened with the cloud Okay. And mobile, but it's gonna be much bigger.
Speaker 1:Mhmm.
Speaker 3:And so if you look back at the cloud, and we in this room have all studied it, there wasn't a particular player or category that had a lot of upside. It was all over. Mhmm. It was the foundational infrastructure and hardware, obviously, and and we're very proud to partner with AWS to provide sort of that, quote, unquote, hardware layer to Vercel as a global network. There was a lot of upside for developers that quickly changed their behavior.
Speaker 3:So this is very important, by the way. When I noticed AWS, I was very quick to dis luckily for me, I was very quick to dismiss the other DIY options that were available to me because I got so excited by the automation potential. And there's merits to all solutions, but being an early adopter in in writing the right way, that can be transformational to your career. Later on, it happened with React. React was open sourced by Meta.
Speaker 3:I believe that's one of their greatest inventions. And I was also quick to adopt, and I noticed its potential as the engine for what later became Next. Js. And so I think my advice to people would be, you know, just adopt AI and see where you can add value. I think the application layer is extremely exciting because the interfaces to AI, as I mentioned, will decentralize and unbundle.
Speaker 3:There's gonna be a lot of upside for agentic infrastructure, so companies that know how to work well with not just humans, but agents. And that's a very that's a remarkable shift. Right? A lot of products have been so far created for developers, not for the agent. You think of it as a representative of the developer.
Speaker 3:You have to create products that are good for the representative of the developer.
Speaker 2:How do you Yeah.
Speaker 3:Go ahead.
Speaker 2:I was gonna say how, you know, as a leader, how do you work with your team? You know, the a lot of people that sort of like high level leadership advice is like the CEO helps the team focus, but then in the case of Vercel, there's so many different areas of the business now. And it seems like you're very focused on on serving your customers, the developers and the sort of, you know, companies building on Vercel. But at the same time, you have like all these different bets. How how do you kind of like prioritize internally and it seems like you're okay with just doing things in the way that you know Facebook releases React, you know, they've benefited from it, but they haven't nearly captured all the value from it.
Speaker 2:And so it seems like Of course. Okay with sort of, you're very open to sort of releasing things and not it's less oriented around we need to, you know, capture a % of the value that we create or
Speaker 3:Yeah. I think short term obsession over value capture is is not the right recipe to build a generational company. And I'm obsessed with growing the the size of the pie. My number one allegiance is the web. Mhmm.
Speaker 3:So I was in Argentina. I was able to and this I you know, when you're a kid and you try out lots of different programming languages, the thing that blew my mind is the URL. In fact, if you look at the success of Vercel so far, it really is about the success of a of a URL. Is that I thought, holy crap. Kubernetes is so hard.
Speaker 3:CDNs are so hard. What if people could just deploy with one click or one press of a button and get back a URL of what they're working on that they can share with the world? Look at other companies that have been massively successful, like, or products like Google Docs or Figma. They've essentially done that. Like, a thing that didn't have a URL before now has a URL.
Speaker 3:Yeah. We're doing that for every application on the planet. So it's primarily an infrastructure business. And then on the other hand, we know that in order to cast the widest possible net and attract the widest numb biggest number of people, open source is the only way. It's nonnegotiable.
Speaker 3:And in addition to Next. Js like I mentioned, we created Next. Js sorry, Next. Js and AI SDK and Turbo, and, we we acquired a bunch of companies like ChatCN. And and so the more we can, you know, cast this message out of the world of the web needs to win, and, also, it needs to win because we have the best products.
Speaker 3:I I you know, I you can think of our competition as all these other products in the developer ecosystem. Another reframing that is perhaps more interesting is think about Apple. Apple is holding an entire world hostage Yeah. To a lot of arbitrary rules. Mhmm.
Speaker 3:They make all the calls. You know? The web that I experienced when I was a kid was a web that is completely permissionless Oh, yeah. Which is also why I'm primp to pill, then we could get into that and whatever. But permissionless is actually the most important.
Speaker 3:It's like freedom of speech is up here, and then right up there is also permissionless, which is also increasing the form of speech. Is that you can get something into a URL without asking Tim Apple for permission. And so that is the true enemy, so to speak. And I think my message to all these other companies would be like, let's band together and make sure that you can publish without going through an absolute review process. You can launch crypto companies without asking Apple what they think about crypto.
Speaker 3:Whatever you want, you should be able to and and AI. Right? Like, AI models need to decentralize and get into the hands of developers as quickly as possible so that we build defensibility against the sort of, like, monolithic AI systems. I think I'm trying to think about, like, how September or whatever that is, like, or Sky. I just I don't wanna go to one interface.
Speaker 3:Vercel needs to this decentralized and democratized URLs and interfaces to the world. And by the way, my other point was gonna be, I'll give credit to Apple. They have a culture of quality, and they've managed to permeate that culture of quality to that to their ecosystem. And and I want that for the web as well. Wanna make sure point.
Speaker 3:I actually don't even have a particular force in the race. No. We don't we not only support Next. Js, we support another 35 frameworks. Whatever framework allows me to go to a website like a blind tasting, it could be like, oh, this website is freaking great.
Speaker 3:You should be able to work backwards to, oh, they use some technology supported by Vercel. That's my that's my fitness function.
Speaker 2:Curious. Did anybody ever, come to your office with $5,000,000,000 in cash and tell you to, you know, ask you to train a a foundation model? And, how did that conversation go? Because I'm I'm sure, like, you know, in all the craze of the last couple years, there could have been an opportunity to just, like, you know, I'm sure there's a bunch of people that would have been happy to say, hey. You're really well positioned to build Yeah.
Speaker 1:When's the humanoid robot coming?
Speaker 3:Yeah. People Not that People seem to be very obsessed with the v zero data. So I'll tell you, also haven't shared this before, but so many companies have come and asked for because, by the way, like, the interesting thing about vZero is and going back to the design mindset and quality mindset is we're trying to produce things we're proud
Speaker 1:of. Mhmm.
Speaker 3:And and nested. We're proud of. Our customers are proud of. End users of the Internet say, okay. Now there's a better web.
Speaker 3:I think we should also ban against AI slop. Like, we shouldn't create a web that has this overly brushed texture images coming out of, like like, low quality models and whatever. And so a huge inspiration for me was actually Midjourney. Mhmm. Midjourney, speaking of which, is that Next.
Speaker 3:Js user that self host Next. Js, extremely proud of that. And they there's something about, like, the taste that gets embedded into these models. So it's not just the data that you want. It's also infusing your preferences and taste, and it's almost like casting an opinion into the world.
Speaker 3:Like, this is what I believe products should look like. And by the way, you also want, and this is why the conversational interface is so fantastic, you can still leave the customer to their own creativity. So you can say, go to v zero and you say, build me a product for travel. Like, actually, also a Vercel customer.
Speaker 1:That's good. And then
Speaker 3:you're like
Speaker 1:Thank you.
Speaker 3:Well, I don't like it. Make it more yellow, you know, and, like, the model will follow. Yeah. So it's striking that balance between creativity and best practices for a better web.
Speaker 1:I I have a question. So I'm, like, completely convinced on the strategy of, bringing in new developers, allowing even non nontechnical folks to build and deploy websites. But some of your companies, some of your clients are absolutely massive. And one of the critiques is like, well, you're abstracting this AWS infrastructure. It can get kind of expensive.
Speaker 1:What what are the conversations like on your side to keep a Nike or an Uber on Vercel long term? And what what how do you see those relationships going, and how important it is it to not only enable someone to show up nontechnical, prompt, build an app, but then scale it into that one person, $1,000,000,000 company, and they're saying, yeah. You know what? I'm sticking with Vercel forever.
Speaker 3:Yeah. Yeah. Your question also contains the answer because you said, you know, Vercel's has been getting a lot bigger. Yeah. And because we've been getting bigger, which, you know, comes with these challenges, like, extra and whatever.
Speaker 3:But the ultimate privilege is the amount of incredible infrastructure optimization that we can do. When you're starting a company, a little company, like, you're not thinking about optimizing. If you're thinking about optimizing, you're probably not doing the you know, we we have this motto that we introduced at, Next. Js Conv that is a famous, there's a famous essay in the software engineering industry of, like, you first make it work, you then make it right, and then you make it fast. And I would add a fourth, and then you make it cost efficient.
Speaker 1:Sure.
Speaker 3:And, actually, from a computer science point of view, fast and cost efficient actually almost come together. We've done so many optimizations of the infrastructure. I think this year, we've already announced eight price decreases or, like, last quarter and this year, and we continue to announce price decreases because we're passing on the cost savings that we realize in our infrastructure at on all sides.
Speaker 4:That's great.
Speaker 3:The CDN is getting more efficient. The compute we just announced fluid compute. The it's a staggering what we've done in terms of, compute efficiency. Some customers saw an improvement in efficiency of 85%.
Speaker 2:Wow.
Speaker 3:So so what I would say to the nineties of the world, the previous story of Vercel, which is still fundamentally awesome, is you won't have to worry so much about DevOps and platform engineering and on call and and those human costs, which are ginormous. And now you'll be fighting for, like, infra high quality infrastructure engineers with all of the AI companies as well. So, like, the human cost is very real of doing something in Vercel. But then the scale cost of, like, Vercel actually gets more efficient the more I use it is awesome. And we we're con committed to continuing to sort of shared those, infrastructure savings with our customers.
Speaker 1:And by
Speaker 3:the way, the inspiration here is AWS. I think
Speaker 1:Sure.
Speaker 3:When I started using AWS, was quite expensive. And then they just announced so many price decreases because and by the way, that's kind of the dance. We manage Next. Js for people. You can also self host and manage it yourself, and we're actually also partnering with companies that are even competitors of Vercel to help them manage Next.
Speaker 3:Js better when they wanna create an offering like that, and we know that there's work to do there. But the nice dance is that if we if you let up and and let us manage your workload, we will be able to optimize it to a level that is sort of unbelievable.
Speaker 1:Well, it's noon. We'll let you go. I'm sure you have a bunch more to see today. Great having you on. Please call back in when you have more news.
Speaker 3:I love it.
Speaker 1:A really fun conversation.
Speaker 3:I love your show. This is great. Thank you so much for having me.
Speaker 1:Yeah. Thanks for coming. I'll see
Speaker 5:you on next.
Speaker 1:This is fantastic.
Speaker 2:See you on next.
Speaker 1:See you on next. Yeah. That was fun. Always a good excuse to use drama to get the real story. I feel like
Speaker 3:Yeah.
Speaker 1:We struck the balance
Speaker 2:there very When when somebody's able to speak with more than a 44 characters.
Speaker 1:Yeah. All of a sudden, the nuance just comes in. It's amazing. You know? Emerges.
Speaker 1:Yeah. Fantastic. But very very cool. Yeah. Very cool company.
Speaker 2:It's a crazy position to be in where you're hosting potentially the next Google.
Speaker 1:Yeah.
Speaker 2:Right? That's crazy. You go to OpenAI right now, this is relatively recent. I don't know exactly when they search It just says, what can I help you with? Yeah.
Speaker 2:Yeah. And then
Speaker 1:Yeah. There's no landing page anymore for learn about OpenAI jobs. It's like you're here to do
Speaker 2:Yeah. They still have a little bit on the side, but you know, very, very oriented around.
Speaker 1:Anyway, we got Lulu coming on to break down the the drama and the comms. We're gonna talk to her about a bunch of stuff. But we got to ping her because she's not in the waiting room yet. So let's ask. Let's see.
Speaker 1:Okay.
Speaker 2:Good. Let's see. We do
Speaker 1:have her on
Speaker 2:She was here then left.
Speaker 1:Okay. Maybe I should send
Speaker 2:her She's extremely busy. She is. She jumped on. She only had thirty seconds. We weren't ready.
Speaker 2:She bailed. No, I'm kidding.
Speaker 1:I I believe it. Yeah. Anyway, let me try and send her this thing. And in the meantime, we should do some posts.
Speaker 2:And she is back.
Speaker 1:Is she back? Let's see. Well, I mean, maybe was getting to tell you about Bezel. Bananas. That's a great time.
Speaker 1:I got a I got a beautiful Vacheron Constantin on purchased from Bezel. Highly recommend you go pick something up over there. They have over 23,005 luxury watches, folks. Fully authenticated in house by Bezel's team of experts. This watch right here, it's shipped from the seller to Bezel.
Speaker 2:Anytime I see drama on the timeline, I can't help but think if the two people arguing just went watch
Speaker 1:I was thinking about that watch to watch.
Speaker 2:If they went or no. If they just went and they browsed around Bezel together for an hour talking about what they like and what they don't like, they would find common ground and they would squash the
Speaker 1:beat. This is Bezel is a is a technology that will bring harmony to the timeline, I believe.
Speaker 2:Now a lot of people said, oh, oh, we got Lulu in the chat. Let's do it. Hey. There she is.
Speaker 1:How you doing?
Speaker 4:Hey. Good to see you.
Speaker 1:Welcome to the temple of technology. We're live. You're live.
Speaker 2:Fortress of finance.
Speaker 1:The fortress of finance. The capital of capital. Great to see you.
Speaker 2:I'm I'm kinda surprised it took this long to to get on the show.
Speaker 1:Former brother of the year 2024. And for some reason, we had to do 75 guests before we could get you to sit down. What happened?
Speaker 4:I had to make sure the show was good.
Speaker 1:Oh, yeah. Okay. Yeah. I I I big dog in us. She was
Speaker 2:a dog in us.
Speaker 1:His reason's fair. But we're glad you could take time out of your incredibly busy day to sit down with us, chat. There's so much to talk about. I wanna talk about the comms around Saratoga Water. I wanna talk about morning routines.
Speaker 1:Did you wake up at 03:40 this this morning and dive directly into a pool, or are you taking a little bit slower today?
Speaker 4:No. Every morning, I dive for five minutes.
Speaker 1:Yep. In it. I have a medium
Speaker 4:mid air suspension is four. I like to go for five, sometimes seven. Fantastic. Average five for me. Great.
Speaker 4:I dunk my face, like, every once every ten minutes. I think just gotta go a little bit above and beyond, stay ahead of the pack, rub the banana peel. I don't just do the face. I do the neck, get behind the ears. So fully ready for the show.
Speaker 2:Always taking it always taking it to the next level. What what do you you you had critiqued that Saratoga Water, that their their last post was a bunch of was hashtag soup. You described it. Yep. How if you were if they were a client, do you have anything particularly that you would have advised them on of what they could have done better?
Speaker 4:Yeah. You're I I don't have any fancy water companies in my portfolio. So I'm
Speaker 1:just thinking on that. You might be getting a call later today. Yeah.
Speaker 4:Yeah. No. I'm not I'm not fully diversified yet. I thought I was. Okay.
Speaker 4:I I think they just have to wake up here. There's somebody whose job is to run social for them. I'm sure there's, like, a person whose area of responsibility is this, and they were just completely out of the game. Like, some people said they were on Instagram, but on is pretty generous there. Like, they were present on Instagram with a check mark.
Speaker 4:The post weren't actually that good. I I think there there are some brands that are, like, boycotting x because of Elon, whatever, but you're just kinda hurting yourself. Like, it it's, like, you're owning your own balance sheet to try to own Elon. You're owning your own cash flow because you're mad at Elon. Just, like, go on x, make money, do what you need to do, forget about your personal feelings.
Speaker 4:I don't know if that's actually the reason, but if it is, it's a bad reason.
Speaker 1:It does feel like it's a bit of a fifteen minutes of fame moment for them. And so I I wonder, like, what is the good ending here? Like, they quote tweet the video. They lean in. They're making jokes.
Speaker 1:They capture a bunch of, you know, attention. Maybe they grow their account from a thousand followers to even, like, a hundred k because it's such a viral moment and a billion people saw the morning routine. But then what do they do with that after after that? I think
Speaker 4:they have to oh, okay. I think the gold standard for this before the famous rug was the Haktua girl. Totally. She took the fifteen minutes and just extended it beyond what the laws of physics seem to suggest was possible.
Speaker 1:Yep.
Speaker 4:And I think what the water company could have done here to to extend would be, like, lean into the routine, like
Speaker 1:Mhmm.
Speaker 4:Partner on some routines, lean into the unhinged. Like, I know that they're this sophisticated fancy type of person, but still, sometimes you just gotta roll with it. Strike up some partnerships. Have, like, follow on content. Like, lean into the funny.
Speaker 4:Just do the bar is, like, literally anything, and then it's, like, getting creative, and then it's, like, something really enduring. And if they wanna do something really enduring, maybe it's, like, a program. Maybe it's, like, some pop up stuff to just stay top of mind. But the the actual bar of just, like, showing a pulse was not that hard to hit.
Speaker 1:Yeah.
Speaker 2:Yeah. Yeah. I feel like the challenge is I have no idea what Saratoga's brand stands for, but now in my mind, it stands for getting up at 03:45, putting banana on your face, having four minutes of airtime. And so it's almost like they they they I'm I'm the most water obsessed person that I know by a long shot and I didn't know what they stood for before. It's almost like the right thing to do is the the the right deal to do is you hire, you just say, hey.
Speaker 2:We're gonna kinda scrap our our brand from the last two hundred years. I think they're a very old company. We're now the Ashton brand. Yeah. You know, we're signing we're signing them to a maxed out
Speaker 1:It's just a 50.
Speaker 2:Eight figures. It's a 50.
Speaker 1:18 70 two.
Speaker 4:Well, listen. It's time it's time for a reefer. I do a brand partnership with Chiquita Banana.
Speaker 6:That's great. There
Speaker 3:you go. Yeah.
Speaker 4:Did banana collab, you could be doing, like, some people commented when he opens up the journal. He's on page one of his journal.
Speaker 1:Oh, yeah.
Speaker 4:Like a notion partnership that like the world is no oyster here. There's a lot you could do.
Speaker 2:Yeah. Let let's talk about you created a meme going going direct. I I feel like it's one of the the most powerful
Speaker 1:Yeah.
Speaker 2:Like basically memes Was it
Speaker 1:our trend of the year?
Speaker 2:Potentially trend of the year. I mean, that and founder mode are the two you think about things that have sort of influenced founder thought in the last five years, happens to be in my view going direct in founder mode.
Speaker 1:Totally.
Speaker 2:And they go hand in hand. Have you, I'm sure you're already thinking about sort of what the next play is. Is the next play going indirect?
Speaker 1:Going indirect. Getting puff pieces
Speaker 2:my Getting puff pieces stuff like that. But no, but what do you think is, now that sort of this sort of like way of comms has become the standard, is this just the enduring approach for the next however many years until we get better institutions?
Speaker 4:You gotta you gotta always outrun yourselves. I'm really glad you brought this up. We did not coordinate by this by the way. Like, you guys gave me virtually nothing to prepare with and no time points. I can be, like, fully unprepared.
Speaker 4:Thank you. So we didn't we're naked. I actually had been thinking about this because Rasha Rasha launched around a year ago, almost exactly a year ago. And in that intervening year, founder mode has has kind of become part of the canon. Like, it's here.
Speaker 4:It's not evenly distributed. Maybe Deloitte is not going direct, but, like, founders going direct is now part of the default playbook for comms. Like, any YC company that's coming out into the world today, they're thinking the founder is gonna go direct. But the thing is you have to outrun yourself. Like, once something becomes the thing that everybody does, that becomes the new norm, and you always wanna be standing up above the norm.
Speaker 4:Like, I remember for a while last year, I was doing manifestos. I was having all of, like, my founders and my companies do manifestos. And then for a three month span, it's just like every other week of manifesto. It actually be I kinda got, like, manifestoed out and same with, like, the secret plans. Same with
Speaker 1:five reels. Yeah. Same thing. Kinda burned through them.
Speaker 4:That one happened really fast.
Speaker 1:Yeah. Yeah. Sorry, everyone.
Speaker 2:Yeah. Well well, so how do you how you think so
Speaker 4:More more Montage wheels, guys.
Speaker 2:Yeah. So we we just had Guillermo on. Vercel creates Next. Js. They release it to the world, and then they say, yeah, we'll manage it for you if you want, or you can just use it by yourself.
Speaker 2:You basically open source the concept of going direct, but then you have sort of playbooks that you run with your founders. Is there anything else that, you know, the thing about something like going direct is you can tell somebody any any sort of like highly specialized skill set.
Speaker 4:Double fisting Celsius? What is that in front of your hands?
Speaker 2:I go I go Yerba Mate. You go
Speaker 1:the Yerba.
Speaker 2:John goes Celsius.
Speaker 4:That's Oh, nice.
Speaker 2:Pretty reflective of
Speaker 4:our brand It it triggered me because the week before last, I had two sides. I didn't know how
Speaker 1:caffeinated Oh, they have a lot of caffeine in there.
Speaker 4:Oh, I needed like a defibrillator.
Speaker 1:Oh, yeah. 12
Speaker 4:Red Bulls.
Speaker 1:400 yeah. It is six Red Bulls, I think, technically. Who's counting though?
Speaker 2:Yeah, got to be careful. But idea is like is there other things that are, that maybe fall outside of that that you feel like you can sort of like open source like things that you can just tell the world they're very hard to execute so they should still go to your firm to actually pull them off. But what else are you thinking about kind of like open sourcing?
Speaker 4:Yeah. Or they can just do it. I I like the concept of open sourcing. Like in fact, you you should be able to do it by yourself whether I get hit by a bus or your team gets hit by the you know, gets hit by a bus. There it should never just like rest on any one person.
Speaker 4:I think the next era so so going direct was probably the big thing for the last year. I think the next era is in shorthand, attention is all you need. Like, in a world where AI can just do anything all the time, you can see people, like, shipping and launching stuff. It used to be monthly, then weekly, and now daily. There's just, like, huge drops all the time.
Speaker 4:And it's a tree falling quietly in the forest unless you can get people to actually care about it. So the two things are, number one, how to get the attention and just, like, focus it for a small period of time. And then number two, how to harvest it and turn it into something. Like, the big mistake that founders make is they'll do something to catch a little bit of attention, and then it goes away. Like, we're talking about Saratoga water.
Speaker 4:It goes away, and you didn't do anything with it. So you're doing, like, attention, catch, release, like like like Yeah. California with illegal migrants or, like, sports fishing. Like, don't do the catch and release. Hold on to the attention and turn it into money.
Speaker 4:Like, your job is turning attention into money.
Speaker 1:I mean, that's the beauty of the Ashton Hall thing. He he went super viral, but he already had been on Instagram for five years, had millions of followers over there. He goes super viral. He already has a whole business set up on coaching and fitness stuff. Like, there is a funnel.
Speaker 1:If you found him from this expost, you're gonna be paying him if you if you like him very quickly. Yeah. Whereas with Haktua Girl, we were talking about this. Like, she had to spin up a podcast. And then I'm sure at a certain point, was like, well, this crypto thing seems like a good way to make money, whereas Ashton already has a business and can just go capitalize on delivery here.
Speaker 1:Oh. Thank you, Brent. You, brother.
Speaker 4:Here we go.
Speaker 1:We got the Saratoga.
Speaker 4:That should do the dunk lives, the new ice bucket
Speaker 1:challenge. Yeah. All do need
Speaker 2:holes to dunk our face in.
Speaker 1:Yeah. We definitely do.
Speaker 2:So so here's a question for you that I think that I think is actually an interesting one. So the three of us are are are dear friends with David Senra. Mhmm. And David has sort of studied all these entrepreneurs that were able to build these massive careers or massive sort of family empires completely in silence. Right?
Speaker 2:Made a post he made a post two weeks ago that was something to the effect of like, I talked to this family. They had written biographies about the family and he asked if he could do an episode on them and they were like, absolutely not. We're not giving away our our our sort of secrets. Is do you think that, you know, do you think that that the playbook of just sort of like building in silence and you're sort of in the shadows and nobody, you know, and not really sharing what you're working on? Do you think businesses like that will will there seems like there's tons of examples throughout history that was pre internet, right?
Speaker 2:Yeah. If you take if you take the strategy of of we're gonna kind of like build in silence, you know, be very secretive, does that playbook work when you have 10 competitors that are gonna be extremely loud, constantly sort of like accumulating attention. Yeah. Yeah. And I just wonder if that's sort of a pre Internet strategy.
Speaker 4:So the the thing here is right you know, one day soon, maybe you'll have the one person billion dollar company. But for now, the company that wins is the company that can recruit and attract the best talent. And the pool of super elite differentiated talent is pretty concentrated, and they're all being headhunted by, like, the same firms. And so the way to get ahead is to get that talent before your competitors can, and they'll join you if they know you and trust you and believe in you. And so if you're someone who's already a household name, like, Palmer Luckey went silent for a while, it'd be fine because people know what he's about.
Speaker 4:Ilya Sutskover has been silent for quite a while, and people know you don't have to try to figure out, like, what am I gonna get if I try to go work for them? And they have, like, demand knocking on on on their doors. But if you don't have that, then you do need to build it. And I think where your question is coming from too is, like, we see a lot of founders get dunked on for, like, yapping too much and posting too much. And it's like, when are you when are you building your company?
Speaker 4:You're tweeting, like, every hour. And I think the the one thing to know is it's not about how much you yap. It's about the ship yap ratio. You have to respect the ship yap ratio. And if the ratio is right, you can get away with anything.
Speaker 1:That's great. Yeah. I I Yeah.
Speaker 2:Elon Elon is a perfect example of this. Nobody's like, hey. What? You, Bro, you're you're posting, you know, 20 times an hour. Relax.
Speaker 2:Like, okay. The rockets are are being caught. The car
Speaker 4:is are being caught. It's sitting in the chopsticks. He's gonna he can post what he wants. Out.
Speaker 1:On ongoing direct, I've always thought that there's a little bit more nuance there. Obviously, it's it's it's really key to tell someone that, like, hey, it's okay to start posting and and going direct and and doing, you know, founder led communications, but that doesn't mean that you should close off the indirect channels. And I see it almost as like, like tiers or levels. So level one is like you start telling the world what you're building, build some credibility. Maybe there's some posts on X from the founder's account.
Speaker 1:Then you start doing new media, like podcasts like this, calling in, telling you know, you're using other people's platforms, but you're accelerating. And then eventually, the traditional media comes in and writes, like, the big profile, and that still has a lot of benefit. Can you talk to us about how founders should think about riding up that curve and where the value is across all three of those?
Speaker 4:Yeah. So roughly, you wanna think of it as ex as, like, concentric circles going outwards.
Speaker 1:Sure.
Speaker 4:And you cannot mess up the order. So the inner the innermost circle is your cofounders and executives and the people who work for you. Mhmm. And they have to believe, and you have to fully saturate them with the propaganda and the sense of mission before you go out to the next circle. Next circle maybe is investors board, and then you get to customers, and then you get to maybe regulators, maybe other people.
Speaker 4:But the problem with trying to skip one of these in the sequence is, let's say that you didn't brief let's say that you're launching, like, a new mission and you didn't brief your employees on this refreshed mission, but you go to the press and now your employees are reading it in the press and there's a disconnect, two things can happen. One, they're like, WTF. This isn't what I signed up for. Now you have a world of pain because any pain coming from inside the house is, like, a thousand times worse than external. And two, your employees have freedom of speech, and they have Twitter accounts, and they can go on x and post like, well, wait a second.
Speaker 4:I'm not are you sure? This isn't this doesn't seem right. And then all of a sudden, everything everything downstream of employees has lost credibility because people figure if it's true, employees would know about it. And so sequencing it correctly and not getting too greedy too fast is really important. Like, always go from the smaller circles to the outer circles.
Speaker 2:That makes sense. How do in terms of getting every every company wants to get attention. The challenge is that there's some sort of cheap things that you can do that get massive amount of attention that are sort of like, you know, basically like slop. Like, I won't name it, but there was a launch video in the last thirty days that was just in Yes. My group chats was like super cringe.
Speaker 2:But then it got like millions of views and I was looking at it, I'm like, alright, like this seems like cheap attention, but then maybe it just got so many views that it works. Talk about, maybe talk about like taste when it comes to getting attention and is there more longevity if you're sort of building that sort of slower base of sort of like tasteful releases and comms versus like the cheap high attention moments.
Speaker 4:Yeah. Tasteful tasteful vids. So there's there's two things. One is the you know the the crazy hot chart?
Speaker 1:Yeah. Yeah.
Speaker 4:The crazy hot chart.
Speaker 1:Of course. Yeah. Who does it?
Speaker 4:There's like a company crazy hot chart where if you're really hot as a company, there's a lot that you can get away with. But if you're new and people don't know a lot about you, then every single thing you do or say is, like, disproportionately disproportionately affecting how they think of you. And so if you have a ten year history of just, like, wins and bangers and you have one thing that is kinda weird or flop or a little bit cringey, you can kinda get away with it. It gets absorbed a little bit better. But if your company is launching for the first time and the one thing people see is 100% of the data points that they have about you, you can't really afford that.
Speaker 4:So I'm not saying don't take risks. I'm saying that the importance of taste goes up, like, even even more when you're new and there's not a lot of data points about you. And then the second thing about, just taste versus quantity is a lot of things that get a ton of likes and engagement are just total garbage. Yeah. And the responses are all like bots.
Speaker 4:Like, if you go to a TechCrunch x post and look at the replies, it's just straight up bot replies. If you go to these these, like, framework bros or, I don't know, the the, like, mental model bros
Speaker 1:Sure. Sure.
Speaker 4:Here's what happened this week, thread bros.
Speaker 1:Yeah.
Speaker 4:Get a lot of engagement, but I would not trade that for the world. And so the thing to look for is, like, who is in the replies and who is not in the replies.
Speaker 1:Yeah.
Speaker 4:Because replies are usually really positive too, but it's positive from people that, like, it's a counter signal that they like.
Speaker 1:Yeah. Exactly. It's all about signal. Right? Signal.
Speaker 2:Yeah. Do you think the best sort of, like, going direct founder mode to put it in one bucket CEOs are sort of like born that way and maybe you need to help uncover that ability of like sort of communicating their story to the world or is it something that anybody can figure out with sort of proper training and understanding sort of social mechanics and the platforms Yeah. That we distribute content on and all that kind of thing?
Speaker 4:Okay. There are different archetypes of super cracked, impressive founder that you wanna just throw your life to the side and go follow them and and do whatever it takes to get on that rocket ship kinda feeling. There's different archetypes of founders who can inspire that feeling. But the key is you can be in an archetype, but you can't be between archetypes. You can't be in the cringey uncanny valley of here's the real you and here's the online you, and you're sorta, like, make it halfway there.
Speaker 4:You can be the, like, super brash, controversial, loud type. You can be the memey funny type. You can be the strong silent type of founders and just, like, one thing once a year. But if you're type three and you're trying to force yourself into type one, it's gonna be painful for everybody, like, of all you. And people can tell.
Speaker 4:Right? So so I I think it's less about there's one type and you have to be it, and can you learn it, or do you have to be born it? It's more like there's different types, and you can fit into one of those types, but you can't try to jump from one type to another and kind of like fall into the abyss halfway in between.
Speaker 1:Yeah. Think about the difference between like a David Holes and a Justin Mares. Like, Justin is doing threads, but they're very detailed on health and breaking stuff down. David Holes just shows up once a week and tweets something like about the future and how AI will like change Yeah.
Speaker 4:Like alien civilizations.
Speaker 1:Yeah. Alien civilizations, but they wrote great posters. But if they tried to swap, it would be really, really, really weird. Yeah. You you sometimes
Speaker 4:see people, like, online LARPing as plumber,
Speaker 1:like Totally.
Speaker 4:Yeah. They're trying
Speaker 1:to get someone else. Yep. Exactly. They're like, I want that trick.
Speaker 4:Chip on my shoulder.
Speaker 1:And and I always say this for the going direct thing is, like, how do you communicate? Because there are some people who their their authentic communication is best in a blog post or a long post. Other people can be really pithy and just post bangers. Other people are really great on video and should just do a podcast circuit. Other people are great on, you know, national TV.
Speaker 1:And so figuring out where the founder sits and then accelerating that instead of being like, well, x is the popular one, so I gotta figure that out. You you you it can be very hard.
Speaker 4:This is what we were talking about, and you were you were saying I should describe it as default out. Remember?
Speaker 1:Oh, default out. Wait. I don't remember that. Explain that.
Speaker 4:Were we you and I were
Speaker 1:talking Yeah. Yeah. Yeah. Yeah. Yeah.
Speaker 1:Standard out. Standard out. You were talking oh, okay. So in programming in
Speaker 4:programming Standard as a way as like a as like a a metaphor for the the default Yeah. The default type of medium that somebody should use.
Speaker 1:Yep.
Speaker 4:And if they need to go outside of that, they can, but everybody has, like, a strongest like, a default medium. And you can you don't have to, like, only stick to that. Like, you can go outside of it. Some some of these, like, Andre Karpathy posts are actually a blog post and just dumps it into the Xbox and hits post and it's fine.
Speaker 1:Yeah. I mean, a lot of that's about the flexibility of the x platform, but there are definitely great CEOs out there who's, like their default out should just actually being going and sitting down with, you know, Andrew Ross Sorkin and doing an interview and they will they will crush that and if they and then and then that clip should live on X and someone else should live Yeah. But they should not try and turn it into a banger hilarious post because like Yeah. That's just not authentic to who they I have a I I have a prompt for you. One of our one of our 2025 goals is to get a glowing puff piece in a mainstream journalism outfit.
Speaker 1:What's the strategy for getting TBPN on the cover of the New York Times or the New Yorker? What should we do?
Speaker 2:Or The Journal would The Journal Journal be ideal. So
Speaker 1:how can we reverse engineer this? Take us through the steps.
Speaker 4:I think Financial Times
Speaker 1:That'd be great for
Speaker 4:you guys. I see you, looking really nice with that salmon pink backdrop.
Speaker 1:Oh, yeah. That'd be fantastic. Okay.
Speaker 4:You know? Okay.
Speaker 1:Yeah. Financial Times. How do we get the profile done?
Speaker 4:Okay. So the first question is, what is the business goal here? Like, how do you convert attention to money? Right? And you guys convert okay.
Speaker 4:Let's just work through it live. You guys convert attention to money by getting a lot of listeners so that you have leverage with advertisers, and then the advertisers pay you, and then it grows and continues being the most profitable podcast in the world.
Speaker 1:That's the business, Number
Speaker 4:one question is who are those marginal listeners? Are they people in tech that you haven't reached yet and you're gonna get more bang for buck by, converting, like, people in tech who've been living in a cave and don't listen? Or are you gonna go out and reach a new community that you haven't gotten into yet? Or are gonna go to some, like, in between, like, adjacent community where it's people who in let's say it's people in DC who now understand that half of Silicon Valley is in Washington DC, and they need to understand tech better. So it's like policy people who want to understand tech.
Speaker 4:So so here's my first question to you is, like, who is that next, group of listeners that you're going after?
Speaker 1:Probably slightly older public markets investors. We we're pretty big in the private markets for tech, but moving our our we we like to think of it as like YC Demo Day was our NFL combine. Earnings season is our Super Bowl. And so we wanna deliver on, you know, a Super Bowl level event for TBPN covering public company earnings, mag seven. That
Speaker 4:kind stuff. So you wanna go to sell side analysts. You wanna go to the big banks. You wanna go to probably, the exchanges have some events. Like, New York Stock Exchange has events.
Speaker 4:You probably want things that are, like, Citadel adjacent, like, DESHA adjacent to get into that community. And, also, there's a lot of overlap between young tech people and young hedge fund and quant trader people. Yeah. Obvious like, the young Jane Street people just go back and forth. And so if that's the audience, then I would work backwards.
Speaker 4:Like, reverse engineer this whole thing and think, okay. Where are they getting their information?
Speaker 1:Mhmm.
Speaker 4:And what do they already care about that we can tap into? Like, it's it's it's hellishly difficult to make people care about some new thing that they've just never heard of. Yeah. Whereas and Derek Thompson had this insight too. The best viral thing is something that's a little bit new, but a little bit familiar.
Speaker 1:Yep.
Speaker 4:Well, okay. Let's say that we're talking to those people. You're probably gonna aim for I mean, they'll read Wall Street Journal. They'll read Financial Times. Let's just say journal because the paywall is less strict.
Speaker 4:Mhmm. Now you wanna think about how do you fall into one of the coverage areas. Like, are are you in tech? Are you in culture? Are you in finance or something?
Speaker 4:So there for example, New York Times has a guy who is, like, between tech and culture.
Speaker 1:Yeah.
Speaker 4:And so maybe someone like that. Or let's say it's the journal and their tech honestly, their their tech desk, their tech team is in, like, shambles right now because they had this super bizarre layoff a few weeks ago.
Speaker 2:Mhmm.
Speaker 4:And there's just, like, a crazy management decision to lay off bunch of AI and tech people the cusp of API. It was crazy.
Speaker 1:Weird.
Speaker 4:Yeah. So maybe you wanna aim for, like, culture, finance. And then now you're putting together two pieces. One piece is, like, what are the what do those young hedge fund analysts or whatever care about, and what are they thinking about? They're probably trying to understand what's coming out of the tech world and which companies are worth watching versus which are not.
Speaker 4:Yep. And they can see publicly available information, which is very scant, but they're trying to read behind the scenes of, like, which founders are respected and how good are they really and can they recruit, that kind of thing. And then what does the paper cover? And the paper probably covers big trends and what's happening in the world of AI. Like, as we approach AGI, what are changes happening in the world?
Speaker 4:So and then the third circle is, like, the unique perspective that you guys bring.
Speaker 2:Mhmm.
Speaker 4:So I would start by not doing a pitch at all. Mhmm. Just vibing, networking, going out for drinks, chilling, and starting to talk about what's in the middle of that Venn diagram, which is like, you have the unique experience. It's interesting to the people you're trying to reach, and it's interesting to what the journal has been covering. Do that, like, for three months or so, and then figure out one hook that's in the news and then offer to do a deep dive into the hook.
Speaker 4:And then have somebody who's not you, like, have somebody else that they respect who's in your network and their network tell them or, like like me or, a founder or, like, an Eric Lime. You know? Go to them and just tell them, like, this is the thing blowing up in tech, and they should really take a deeper look. And at that point, you're familiar to them. Familiarity breeds affection, positive feelings, but it also breeds credibility.
Speaker 4:So people who are told a fact 10 times tend to believe that the fact is true just because they've heard a lot. So at this point, you're familiar. You have the story dialed in. You have your unique area of expertise, and then you have some third party validator telling them to look deeper into it, that's how it begins.
Speaker 1:Well, thanks for coming on the most profitable podcast in the world.
Speaker 2:Last one. I know you've we've got a minute left. We try not to swear on this show because swearing is vulgar. Yes. And we're very short, bearish using cuss words online right now.
Speaker 2:How are you advising your clients in a world where, you know, big names are thrown around mean words?
Speaker 4:I think it's the same thing as before, which is, like, whichever bucket you're in, stay in the bucket. And if, like, if there's a founder who just talks like a sailor and that's how they are, you can try to ask them to clean it up. I've never seen that work. Okay.
Speaker 6:I've just
Speaker 4:never had an experience where someone tells the founder, like, clean up the potty mouth and talk different, and they actually do.
Speaker 1:Yeah.
Speaker 4:And so it's just that's your archetype. You stay there. But I will say, the the big takeaway, if if people are trying to figure out, like, what is the next era of comms and just if there's one thing I as a founder need to know about about building a call and a movement around my company, it's we're we're entering the era of personality hires
Speaker 1:Mhmm.
Speaker 4:With respect and affection. You guys, ultimate personality hires. I'm one too. Safe space. It's okay.
Speaker 6:Cheers.
Speaker 2:Cheers. Cheers. Cheers to that.
Speaker 4:But in a world where AI is better than us at pretty much everything, every human is gonna be a personality hire. So just figure out what your lane is is and lean into that. And if you have that fire in you and you get into fights once in a while, it's not the worst thing. And if you don't, don't try to LARP as Palmer Lucky and find the fights just so that you can have something to beef over. Just find your lane.
Speaker 4:Be in the lane. Don't try to jump into a lane that is disingenuous and unnatural for you because people sniff it out.
Speaker 1:Yeah. That's really good advice. I like that a lot. Authenticity, as silly as it sounds.
Speaker 2:Great. Well, I have to say thank you for coming on. When your clients have historically that I'm aware of have come on the show, I'm sure there's been some that I'm not aware of that have come on the show. I always come away and just tell John, he was too too he was too media trained. Too prepared.
Speaker 2:Too Too good. So you're doing great work and thank you for for for being a a the former brother of the year and a friend of the show.
Speaker 1:We'll see what happens this year.
Speaker 2:Keep up the good work. Might be two times. Be clear. Could be
Speaker 4:two ceremony. You need to do the ceremony where I go and put the crown and then we all cry. Yes.
Speaker 1:Yes. I mean, we're gonna have a black tie event this year for the award show and I'm sure you'll be invited.
Speaker 4:That's it. Perfect. Alright. Fantastic.
Speaker 2:Amazing. Thanks for stopping by. Yeah. Take care. Bye.
Speaker 1:That was great. Lots of great insights from Lulu as always. What's your review of the Saratoga water? Is this gonna is this gonna put Rora out of business? Is this gonna put every water company out of They're getting so much.
Speaker 1:Let's do a taste test.
Speaker 2:Tastes good. I mean, it tastes fine.
Speaker 1:It's okay.
Speaker 2:This just screams to be the restaurant that a mid restaurant or the water that a mid restaurant would stock.
Speaker 1:Okay.
Speaker 2:Trying to be like, oh yeah, we have bottled still.
Speaker 1:Yeah, yeah, yeah.
Speaker 2:Oh, we have Saratoga. Okay.
Speaker 1:We have Saratoga. Yeah. I think it's I I I think it's fun that it's going viral. Good luck to
Speaker 2:the team. I'm I'm happy for them because I'm I enjoy and appreciate value creation. I'm glad they're they're doing I'm glad they're numbers today.
Speaker 1:Fantastic. They must be so happy.
Speaker 2:Yeah. Every single
Speaker 1:Well, you know what they should do if they wanna keep up the sales coming out of this viral sensation? Buy ads on
Speaker 2:Buy every billboard in The United States.
Speaker 1:They really should.
Speaker 2:Just take advantage of this moment.
Speaker 1:So then you're next 10 com. They have out of home advertising made easy and measurable. Say goodbye to the headaches of out of home advertising. Only AdQuick combines technology, out of home expertise, and data to enable efficient seamless ad buying across the globe. It's great.
Speaker 1:Do do you wanna dive into Cloudflare, or should we just move on to some timeline? What are feeling right now?
Speaker 2:How much did we actually get into of Cloudflare? I
Speaker 1:feel like it's worth We could start Cloudflare. Yeah. But they are the third player in this in this debate. We're gonna have Amjad Masad from Replit on in thirty minutes. And I thought it'd be good to kind of show the three companies that have been duking it out on the timeline.
Speaker 1:Yeah. We we we broke
Speaker 2:down for and then we'll go into the timeline.
Speaker 1:Fantastic. And then So it's an older company. It's a public company founded in 02/2009 by Matthew Prince. That's the CEO who has been chirping at Guillermo on X. The goal was to build a globally distributed network to improve website security and performance.
Speaker 1:And so when you run into Cloudflare, it is a CDN. And so when you're scaling, you're getting a ton of traffic. The idea is instead of those hits triggering database queries and all the stuff that's going on wherever your server is on ABS, they hit Cloudflare first. It can mitigate DDoS attempts because it's it's just delivering the front end web page first, and Cloudflare is a product that helps your website similarly to Vercel be very quick and fast. And they started with a $2,100,000 series a round in 02/2009 to develop a prototype and kick start operations.
Speaker 1:They launched a TechCrunch Disrupt. What a throwback. Twenty ten. They had core services, CDN, DDoS protection, which I mentioned, performance operation, and it was all a freemium model. So you get on to Cloudflare free for a little bit, and then quickly as you start scaling, they start charging you more.
Speaker 1:But as the the tenor on X has been, Cloudflare is still pretty affordable even when you scale up. Amazon AWS has a lot of Cloudflare competitive products. CloudFront, I think, is literally a direct competitor to their CDN pro product. But Cloudflare's been price competitive roughly, and so you get a lot of stuff. And then we'll go into kind of what they're doing to add features and functionalities to their product catalog.
Speaker 1:So in 2011, there is a series b by NEA. They wound up hitting billions of page views, millions of domains served. They're scaling pretty quickly after only two years. They get to that $20,000,000 series b. Then the next year
Speaker 2:That's interesting.
Speaker 1:So million
Speaker 2:series c. I mean, they were basically five years ish ahead of Vercel. Yep. But it's interesting how Vercel's series a was 20, you know? So
Speaker 1:it's like everything just kind like Pull forward. Around. That's a standard. And now And
Speaker 2:now it's
Speaker 1:A $50,000,000 series. Yeah. Make his comment.
Speaker 2:$20,000,000 series b. Yeah. That if a company does that and doesn't say, hey. We we intentionally raised Yep. You know, less money than we could have, you're like, okay.
Speaker 2:They're they're probably struggling.
Speaker 1:Fred Wilson, Union Square Ventures comes in for the series c. That's $50,000,000 in 2012. And they added more points of presence, which means more local servers that can deliver content even faster because the whole name of the game is if you're in Chicago, you want a server in Chicago that's delivering that website. So it's extra fast because the speed of light and physics come into the equation when you're going even just going across The US and back is, you know, at at light speed is several milliseconds and that matters. I I think it's almost like thirty milliseconds.
Speaker 1:I don't know for sure, but it's it's it's significant enough that a content delivery network makes a lot of sense.
Speaker 2:Roughly, is that roughly how fast I was running this morning?
Speaker 1:Oh, yeah. Yeah. Yeah.
Speaker 2:When I smoked the whole team.
Speaker 1:Yeah. We had a little ray a little foot race this morning with the team and Jordy came out on top. He's a fast, fast brother. In 2012, they reached a $1,000,000,000 valuation or close to it based on rapid growth and network expansion. In 2013, they added DDoS mitigation, and they successfully defended against high profile high profile attacks, the Spam House incident.
Speaker 1:You know that's gonna be a good start when you dig into Spam House. But I'm sure, there were there were a lot of DDoS ing going on. I mean, basically, anytime someone was ups I mean, DDoS ing is so crazy.
Speaker 2:Yeah. The back story here is So in March 2013, Spam House, which is a non profit organization that maintains block lists of malicious IP addresses experienced a massive DDoS attack. Wow. Which experts called the largest history that knocked their website offline
Speaker 1:Yeah.
Speaker 2:And broadly disrupted the Internet. So, hey, let's you know the guy that's trying to stop us from doing what we do? Let's let's stop him.
Speaker 1:Oh, yeah. I mean, DDoS DDoS stuff is serious. I mean, a lot of nation states use it to knock off different services that they think are not aligned. Yeah. X has been the subject of DDoS attacks.
Speaker 1:Elon's talking about it
Speaker 2:was a nation state potentially.
Speaker 1:But it's happened it it's happened all the time. And it can happen on a very small scale too if you're just running a small company and there's some kid who's a script kiddie and gets upset with you or just wants troll
Speaker 2:DDoS my dad's website. That's right. He DDoS from our own home. I'd set up I'd
Speaker 1:set up a computer. Yeah. And and it's basically I mean, DDoS
Speaker 2:is And I'd mess him. I'd mess with him, and I'd go like, dad, why is your website down? And then he'd go spend, like
Speaker 1:Yeah.
Speaker 2:Ten minutes being like, oh, I
Speaker 3:don't know
Speaker 1:how this works. It's really as easy as just going, like, like, in the Python code, while one, like, infinite loop, request this website. Yeah. They just request it millions of times, and it can just be done so quickly that if you don't have something set up, you can be in a lot of trouble. And so they doubled their domains to 1,500,000, servicing roughly 5% of global web traffic, getting really, really big.
Speaker 1:Then they go into the meme The thing
Speaker 2:is when companies do the meme. It turns out these generational companies, they do
Speaker 1:the meme. They do the meme. And that's the lesson. Always do the meme.
Speaker 2:Whatever whatever percentage of your TAM that you put in your pre seed deck that you want to achieve, just do it.
Speaker 1:Do it. Just do Yeah.
Speaker 2:You'll be a big company.
Speaker 1:It'll They face the results of scaling challenges. Then on '20 in 2014, they go on this acquisition spree. They they acquired Stop the Hacker, what a great name, in February of twenty fourteen to boost threat detection. They acquired Crypto Seal in June of twenty fourteen to enhance encryption and certificate management. Crypto Seal, I believe founded by Ryan Lackey, good friend of mine, great just kind of genius programmer, honestly.
Speaker 1:Major initiatives, they launched Project Galileo to protect to protect vulnerable public interest websites, introduced universal universal SSL, free HTTPS for all customers, and keyless SSL for high security clients, and then they expanded their global network to over 30 data centers. That set them up for their series d, a 10,000,000 from capital g, that's Google, Microsoft, and Baidu. They got three of the hyperscalers essentially in the company. They expanded to China, and then they adopted a bunch of other technologies, web application firewall, introduced the I'm under attack mode to counter layer seven DDoS attacks. And at this point in 2015, they hit 62 points of presence worldwide.
Speaker 1:So they're continuing to grow. And whenever you're deploying fast applications on the edge, we saw this with Vercel, Vercel going to something like 30 points of presence. Cloudflare's up at 60 in 2015, and that's the name of the that's the name of the game when when you're trying to deliver the Internet very quickly. In 2016, they acquired Eager Platform Company to build out Cloudflare apps platform, and we'll talk about that because that's kind of the product that will compete with the Replit and Vercel stuff is actually being able to run your entire app on Cloudflare instead of just deliver content. So the traditional CDN is images take a long time to load.
Speaker 1:Let's put those on servers that close to the people requesting them. Netflix is a great example. You want to put, you know, Squid Game, the video for Squid Game. You want that to not come from far away. You want that to be up close unless you're caching it.
Speaker 1:But in general, you want it to be close so that when someone clicks that
Speaker 2:button explored high you know, people talk about high frequency trading. We'd explored high frequency podcasting trying to get, you
Speaker 1:know I mean, with the rate we're growing, we'll probably have to build our own Cloudflare, honestly,
Speaker 2:and just That's right.
Speaker 1:Buy our own hardware. We'll probably have to set up our own nuclear plants for it to run the facilities Energy requirements. Create our own our own chip fabs and ultimately Really slice design our own chips. Yeah. Exactly.
Speaker 1:Just completely vertically integrate down to the mining and extraction of nuclear fissile material. That's right. But that's the that's the modern media game you play.
Speaker 2:Yeah.
Speaker 1:You wanna say something? Person company now. I'm sure we'll be at thousands in a couple years.
Speaker 2:So That's right.
Speaker 1:Cloudflare in 2016, they hit a hundred global cities. They had some outages and operational errors. It's it's a it's a rough and tumble game that they're in. Twenty sixteen, they spent is what Guillermo was mentioning, the cloud bleed incident. A security bug led to data leaks quickly identified, patched, and mitigated.
Speaker 1:I don't think there was a huge, huge impact on the business. I don't think information we didn't get a chance to talk to Guillermo about this, but I think both with the Vercel security issue and with CloudBleed, I'm not sure that there was a lot of, like, you know, customer credit card data that was stolen, but it was the potential for harm was was really significant, and that obviously hurts reputations and needs to be addressed with open communication, which is what all these CEOs are trying to do now. Yep. There was also a little bit of a little bit of, like, a a political content debate because The Daily Stormer, which is a very controversial right wing website, was using Cloudflare and obviously was the subject of intense DDoSing constantly. Cloudflare had taken a stance of, hey.
Speaker 1:We're just an infrastructure provider. We we abide by the First Amendment, free speech. If the government wants to shut you down, they can do that, but we are not the arbiter of what should and should not be on the Internet. We're just an infrastructure provider. But in in 2017, they did drop the Daily Stormer after public pressure and internal reviews, and they and they had to kind of rewrite and figure out where is their content policy, what's acceptable and what's not.
Speaker 1:Of course, they're a private company. They can decide what is appropriate to use their server for and they have the right to refuse service.
Speaker 2:They had this happen later. They had they had eight chan with customer. Yep. So they they dropped them at some point.
Speaker 1:And so that's always been kind of a hot button for all these infrastructure platforms. When Alex Jones got de platformed, it was all the way down to like, you know, the Shopify plug in that he uses for reviews wants to not let him use that review widget anymore. And it it it's all it's all a nested bottle like, bag of worms, basically. It's very frustrating.
Speaker 3:Yeah.
Speaker 1:And and, I mean, we saw this with Trump where he got to platform from, like, Pinterest and stuff. So sometimes these things can become, like, big hot button issues. But back to the interesting tech stuff, they launched Cloudflare Workers enabling serverless code execution at the network edge. So what that means is that, if you do have something that needs to be computed on the server side, you're not just delivering your content on the CDN anymore, your your HTML and your images. You're also allowing the user to interact with your app and and create actual server side functionality through these Cloudflare workers, part of the whole serverless trend.
Speaker 1:They acquired NewMob to optimize mobile performance into implemented creative entropy generation lava lamps, pendulums, Geiger counters to enhance security. That's crazy. Have you seen the lava lamps thing? You've So basically, there's this big question on when you're working in security, a big piece of that is how do you generate random numbers? And one of the ways they do it is they create a wall of lava lamps that all move in a completely random and not predictable way.
Speaker 1:And so they take a video of that and then they compress that image and that generates a random number that can't be predicted. Because even if you're even if you're just like, we're gonna use, you know, some random number generated from the computer, There's sometimes vulnerabilities in there where you can actually truly predict. They're all pseudo random number generators. So there's this like race to create the the craziest
Speaker 2:random number Yeah. Look up Cloudflare lava lamps. They have a picture of the actual wall.
Speaker 1:It's so cool. It also just like a great vibe. So I love that. Yeah. Twenty eighteen, they launched the 1.1.1.1 DNS service.
Speaker 1:There's a free privacy first DNS resolver. They did they they expanded to domain registration, wholesale cost domain registration with no markups, formed an alliance with major cloud providers to reduce data transfer fees, which can actually get really crazy expensive. Zero trust enhancements, Cloudflare access, and Argo Tunnel setting the stage for comprehensive security suite. They're taking security seriously Oh, yeah. Putting the screws to Google, and they set themselves up for an IPO.
Speaker 1:So in 2019, they go public, right before they did pre IPO funding. Series e, that's a hundred and $50,000,000 at around 3, 0.2 to 3,500,000,000.0. They dropped more controversial clients, as you mentioned, 8chan. And they had a few operational hiccups around this time, some outages, some software deployment issues, but nothing that stopped
Speaker 2:them as well public. Guillermo was talking about the number one thing Yep. Is, you know, mitigating outages.
Speaker 1:Yep. And so they filed their s one in August, went public on 09/13/2019 at $15 a share. They raised over $525,000,000. Let's go. Historical size gone for them.
Speaker 2:There we go.
Speaker 1:They launched Cloudflare Warp, a VPN mobility service, and then they went on another acquisitions, spree. They acquired s two systems for browser isolation technology and Lync to bolster developer tools, leading to Cloudflare Pages, getting more into the application layer. And then they appointed the cofounder, Michel Zetlin, to as president, marking a milestone in tech leadership. Revenue reached $431,000,000 in 2020 with significant growth in enterprise customers because, again, even though they are competing with AWS, they they famously have built their own servers, own their own hardware, and it can be much more competitive on pricing. This so they enhanced workers for with support for new languages, launched Cloudflare Pages and r two storage, which is s three compatible object storage, but it doesn't have egress fees.
Speaker 1:So Yeah. If you're storing a bunch of images or text or JSON files on s three, you can just move right over to r two, which is, I think Mhmm. Isn't that the one one letter la one one letter more and one number less? It's a very funny name. And so they're they're all about, you know, getting people to migrate more and more stuff off of AWS onto Cloudflare.
Speaker 1:And then they acquired Xiraz to improve third party integrations. Revenue grew to 656,000,000 in 2021. They surpassed 1,000,000,000 in annual revenue in 2022, introduced d one, a serverless SQL database, and went on some more acquisition sprees, navigated complex issues during the during the Russia Ukraine Conflict, balancing service continuity with policy adjustments. They blocked Kiwi Farms, which is another controversial website. There were harassment issues there.
Speaker 1:And so they're they're constantly scaling and then dealing with the fallout of, you know, having a whole bunch of companies on their on their platform. Launched Workers AI in 2023. We partnered with NVIDIA to deploy GPUs at the edge. So if you wanna do AI workloads in an actual city, very low latency, Cloudflare now offers that. More acquisitions, zero trust networking company, secure infrastructure access companies, cloud native security company, just tons and tons of acquisitions as they go.
Speaker 1:And now they are aiming for net profitability and targeting $5,000,000,000 in annual revenue in the coming years. They're expanding enterprise sales and enhancing zero trust and edge computing offerings, and they're deepening their AI integration, broadening the developer platform.
Speaker 2:Yeah. And one thing I love about Cloudflare is they sponsor the US ski team.
Speaker 1:Oh, that's great.
Speaker 2:And so if you like skiing, you might also like their set of products. And this is a Cloudflare at the moment is a $42,000,000,000 public And they've actually you know, they've they've suffered, you know, much of the same sell off than other firms have, but it's just wild to think about whatever that pre IPO round was. The series e have 3,000,000,000. 3 point 2 billion.
Speaker 1:So they're up 10 x those those IPO buyers, something like that. That's great. And certainly a good outcome for Union Square and all the early early investors that got in at those $10,000,000, 20 million dollar rounds, but took a while to get
Speaker 2:here. Fifteen years Yeah. Interesting. One thing that's fascinating, so Cloudflare is a sort of scaled platform. Yeah.
Speaker 2:Has plenty of pages comparing itself to other providers. Sure. And you would think if Matthew Prince, the CEO is coming after Guillermo.
Speaker 1:Tell
Speaker 2:me. That they would have be positioning
Speaker 1:I would expect a Cloudflare versus Vercel landing And
Speaker 2:there's no mention of Vercel on the Cloudflare's website.
Speaker 1:Who are they comping themselves to?
Speaker 2:Vercel does mention Cloudflare. But but I'm sure Cloudflare
Speaker 1:does not. Interesting. Well, maybe that changes after today's spicy Yeah.
Speaker 2:I I just think, like, you know, who knows what's going on behind the scenes. Right? Guillermo didn't mince words when he said, like, we tried to use Cloudflare for a pretty important project internally. It didn't work. And so now I can imagine there there very well could be some ego involved.
Speaker 1:Yep.
Speaker 2:But anyways.
Speaker 1:Yeah. It does feel like a little bit of like a big dogging going on. Just like, hey, little bro, like, you don't even have servers, you know, Vercel. Like, you know, we have our own infrastructure. We compete with AWS.
Speaker 1:You you you're not even in the conversation. Like, that's kind of the energy Matthew Prince brings. But, know, hopefully everyone can benefit from a rising tide and a growing pizza pie. And the pie slices will get bigger for everyone because that's what we want to see. We want to see bull markets Do you
Speaker 2:know where where you can enjoy a nice piece of pizza pie?
Speaker 1:At a wander?
Speaker 2:That's right, John. Find your happy place. Your happy place.
Speaker 1:Book a wander.
Speaker 2:Go to wander.com. Use our code.
Speaker 1:Yeah. You do.
Speaker 2:Enter. They're giving away a trip to TBPN audience.
Speaker 1:Yeah. Go check it out.
Speaker 2:So go check it out. Wander.com/tbpn.
Speaker 1:Inspiring views, hotel great amenities, dreamy beds, top tier cleaning, and twenty four seven concierge service. It's a vacation home, but better folks.
Speaker 2:That's right.
Speaker 1:Anyway, we got eight minutes. Should we hit the timeline?
Speaker 2:Let's hit the timeline.
Speaker 1:Let's go to Sheel.
Speaker 2:Yeah. Great post from Sheel here. He's following up. He says venture capital in the nineties was wild. Good funds had triple digit IRRs.
Speaker 2:And he's pulling up. So KP here, vintage, their first vintage.
Speaker 1:This is why they're in the whole Trinity. Yep. This is why they're in the whole Trinity.
Speaker 2:So their first fund, it's a $8,000,000 fund. They only got a thirty one
Speaker 1:Thirty one x multiple.
Speaker 2:A 51% IRR.
Speaker 1:Yeah. Why is the IRR so low given the multiple? Is that just because it was such a long fund? It took them a long time to get liquidity on those? Like, because they had a 32 x fund, fund seven, but it's a 22% IRR for Yeah.
Speaker 1:For Kleiner Perkins fund seven. I wonder what's going on.
Speaker 2:There's other there's no in in sight. We'll have to get
Speaker 1:Everett Randall from Kleiner Perkins on the show.
Speaker 2:Have a good day. But anyways, their best performing fund was in 1996, unsurprisingly.
Speaker 1:Right before the .com boom.
Speaker 2:That's the right time.
Speaker 1:They IPO'd everything in that portfolio probably. Yes.
Speaker 2:They have a 17 x multiple, but their IRR was 286%. So they just crazy.
Speaker 1:I mean, they
Speaker 2:turned hundred million. 3 hundred million. So fund.
Speaker 1:Yeah. They so they turned into, like, almost $6,000,000,000.
Speaker 2:Yeah.
Speaker 1:Wow.
Speaker 2:And then there's a bunch of other funds here. You got Mayfield, which I feel bad. I should know better my venture
Speaker 1:history Legit. Very old school though. Mean, you can see in in the eighties that we're already on fund four.
Speaker 2:Can you imagine KP comes out Yeah. Their little $8,000,000 venture fund. 31 exit. And they're like Amazing. Oh, I think we might be onto something here.
Speaker 2:What's also interesting is
Speaker 1:all three cities, they just were like, we do $150,000,000 funds. Like, that's what we do. They were
Speaker 2:very Yeah. The fascinating thing is they have their first fund Yep. $19.72, 8 million dollars. They don't raise their their second fund until eight years later.
Speaker 1:Oh, yeah.
Speaker 2:The $55,000,000 fund.
Speaker 1:Probably just so slow and took so long for those companies to get to
Speaker 2:deliver And it's funny that They had to prove it. The learning is like they do this huge, we don't have any data past their 96 fund because I think it just switched to being KP at a certain point. But it's funny that like they didn't learn their lesson on like upsizing the fund because they just put up
Speaker 1:this
Speaker 2:ridiculous performance on on the biggest fund that they have outlined here. So
Speaker 1:Yeah. I mean, I wonder what's in that '72 vintage. It might have been like Intel maybe. I don't even know. Yeah.
Speaker 1:Apple.
Speaker 2:That kind
Speaker 1:of thing. How's that?
Speaker 2:Yeah. Get a couple of those and Lot
Speaker 1:of bangers in there. Koia also doing quite well, putting up big numbers.
Speaker 2:It'd be fun to do I have a feeling that this summer, the new cycle will slow down a little bit. It would be fun to do Totally. Deep dives on, like, the top 20 individual funds ever.
Speaker 1:And the individual part to them. Yeah. Wanna talk I mean, if they're they're still in the game or they're still Gotta get them on the maybe probably retired, probably skiing where they don't have chair lifts. That's right. That's right.
Speaker 1:But we'll get them on the show. We'll have them break it down. We'll have them toast to the good old days wherein you could put up a 31 x multiple in a couple of I
Speaker 2:wanna find somebody that was doing venture capital in the seventies. Send them a bottle of Dom and a bottle of Saratoga. Yep. Say hang out with us for three hours straight.
Speaker 1:Yep.
Speaker 2:And let's just
Speaker 1:Let's do it.
Speaker 2:Talk about the good old days.
Speaker 1:Anyway, should we go to some nominative determinism?
Speaker 2:Yep.
Speaker 1:I love this one. It's Andre Karpathy. And if you break down his last name, it's Karpath. And, of course, this is the man who worked at Tesla on self driving cars, an AI pioneer in DJ Cows says, I think about this every day. And I think about it too, a lot.
Speaker 1:Not every day.
Speaker 2:We do think about
Speaker 1:this a But
Speaker 2:I love this. Yeah. The the Bill Ackman is really into nominative determinism. That's why he's Ackman activist man.
Speaker 1:Sure. Yep. Makes sense. Yeah. It's a great one.
Speaker 2:It's
Speaker 1:a Anyway, should we go over to Super Dario talking to Yeah.
Speaker 2:Just thought this funny because it's been this ongoing sort of thing that we talked about on the show. Arvind Srinivas from Perplexity says, we're building explaining why they're building a browser. He says, it's the only way to create AI agents with enough control over multiple apps especially on iOS. The goal, agents that can book travel, buy things and act as a personalized assistant. So we're just waiting some for one person to build an agent I'm so ready for it.
Speaker 2:To book private jets.
Speaker 1:You know, this is a very silly bridge to what's basically an ad read, but ramp travel is fantastic. I I like, it is a magical product. And I'm not I know I'm saying that I'm super conflicted. But honestly, like, you go there, it it aggregates all the flights. It saves all your information perfectly.
Speaker 1:Yep. You you click it, and it's just automatically expensed, automatically put into like, you just Beautiful. You just show up to the airport and, oh, wow. My TSA PreCheck is
Speaker 2:in there.
Speaker 1:Cheapest Every single time too. Yeah. No. It's it's a flawless product. And then you can also book the hotel right there.
Speaker 1:It is such a good product. And of course, like, as a as a as a, you know, a manager of a company, you can decide what's in policy, what's out of policy, how much you want to spend and stuff. Yep. But, you know, for for us, it's more of like you put a minimum on how much you spend on the hotel so that Yeah. We're we're we're not staying anywhere.
Speaker 1:Staying on brand. But for some companies that wanna save same time and money, they can put the cap
Speaker 2:on that as well.
Speaker 1:But it really is it really is a magical product and I and I wouldn't be surprised if the first time I have an agent book for me, it's in ramp, honestly. It's in there. Because they they they've they've built all of the, like, the harnessing to actually plug in in a really really seamless way. There's no like ads or upsells. It's it's so much better than booking.
Speaker 2:No ads in there, so we'll put one in here. We got a post from Austin, a friend of the show has been giving me a bunch of just, you know, he built the morning brew Yep. Into a monster has been very helpful on TBPN. He's retired.
Speaker 1:I and I For a minute. I put this in here because I wanna call him out. Stop it. This is one of the worst things I've ever seen. I Wow.
Speaker 1:Really, really hate the idea of someone with as much talent as Austin retiring. It's like, get back in the game, create some shareholder value, build a massive business. You should be working a hundred hours a week. America needs you. And I saw this and I was just disgusted.
Speaker 2:I I Okay. But but
Speaker 1:It was it was revolting, honestly. But It it it's it's really really depressing.
Speaker 2:But, okay. But clearly, he's a marketer. He's a media man. And he's retiring so that he can un retire, come out of the gates
Speaker 1:with a maxed I get it. I still I just have a lot of sensitivity around our words specifically. Yeah. That's I don't think we should be talking about retirements.
Speaker 2:I think we should be working to the bone forever. Well, he's staying busy. He is. He's staying busy.
Speaker 1:I love it. He's got a bunch of things that he's doing.
Speaker 2:And we're gonna have him on the show soon. I love it. I'm trying to pull him out
Speaker 1:of retirement. We're gonna pull him out of retirement. We'll convince him. We'll give him a talk
Speaker 2:and we'll give him a talk Come get on the show. Yeah. We'll give you a a dedicated spot.
Speaker 1:Yeah. Yeah. I mean, is funny because he's like, I'm in I'm in retirement and here's my focus. I'm training for a half iron man. I'm investing.
Speaker 1:I've written five angel checks. I'm tinkering. I'm playing with dozens of AI tools. I'm growing. I helped three x Ocean's talent monthly growth rate to two in two point five months.
Speaker 1:Obviously, he's still in the game. He's merely in his Michael Jordan playing baseball era, I believe. That's right. He's getting back
Speaker 2:to lead. Was looking for the right sports analogy. I was like, did I just don't know if I don't know these things, but did did Brady Brady retired at one point briefly? Did
Speaker 1:he I don't know.
Speaker 2:Is that not even correct?
Speaker 1:It's more like doesn't True. Nickel retire in between every UFC fight. Right? And then he comes back. Is that how that works?
Speaker 1:It's technically a retirement. Amazing.
Speaker 2:You always find something new to not understand.
Speaker 1:Well, come out of retirement, come on the show and announce your life's work and get to work, Austin. You're unnoticed. Let's skip the humanoids thing because that's a bigger deep dive. Let's do just a funny funny post because we only got a couple minutes. Actually, how we doing on Amjad?
Speaker 1:Is he in? No? Okay. We will do this Ashley Vance post. Dan Primack shares, remember when Elon and Zuck said they were gonna fight in a cage and lots of people believed them?
Speaker 1:I believed them. And Ashley says, I heard somewhere that Italy wanted to charge them $300,000,000 to use the Colosseum. Not sure if it's true, but I think it is. And I think it killed the brawl.
Speaker 2:What a miss.
Speaker 1:It would have been so good.
Speaker 2:In general.
Speaker 1:It would have been amazing.
Speaker 2:Cash grab, not not usually a good idea and missed opportunity to make Italy the center of celebrity grudge matches, pay per views, things like that. Huge miss. Also, they had a rough weekend.
Speaker 1:Who do you think would have won? Because there was always the thing about, like, Elon is just much physically is physically bigger, but Zuck had been training more. And so it felt like if the fight had happened, like, that week that they were beefing, Zuck would have won. But if you gave Elon a year to train, Elon could learn enough of the basics to put his size to work and win. What do you think?
Speaker 2:I think in a pure play boxing rule set It was
Speaker 1:gonna be next martial arts.
Speaker 2:Oh, it was. Yeah.
Speaker 1:This is something I know about. The only thing I know about is from the Zuck.
Speaker 2:Actually so funny because I do think that Zuck could nerd out enough on technique and get the right and and Elon would go into it being like, yeah, I'm just gonna rely on my size advantage and
Speaker 1:just try to not work out at all. Yeah. Sure.
Speaker 2:Then Zuck would just be nerding out. He gets some like super technical I
Speaker 1:mean the weight alone, I mean there has to be like a 40 pound gap or something. It's like pretty significant, right?
Speaker 2:Yeah. Well speaking of the Italians, they had a rough go in F1 this weekend coming in at What happened?
Speaker 1:Is it Ferrari?
Speaker 2:Both didn't didn't finish. Oh, no. Leclerc and Hamilton. They've had a they've had a rough start to the year. People are saying
Speaker 1:Was it mechanical issues? Was it the car It's
Speaker 2:always something with Ferrari.
Speaker 1:It's always something with Ferrari.
Speaker 2:And people people are saying like Lewis has gotten, like, a full season of, like, the typical Ferrari stuff just in in, you know, barely starting
Speaker 1:the two races.
Speaker 2:It's unfortunate.
Speaker 1:It's rough.
Speaker 2:But predictable.
Speaker 1:Well, should we go to Zach Glabman? I don't know how to pronounce that. It might be Zach g Labman. Says crazy ad placement tri ramp, and it's a united worker at an airport. And in the middle of his in the middle of his bright yellow vest, it just says ramp.
Speaker 2:And this just makes a lot of sense because you have
Speaker 1:Business CFOs or people
Speaker 2:traveling ramp as travel products. I actually saw this and I was like, wait, is this actually
Speaker 1:Do they actually do this? No. Yeah. No.
Speaker 2:Of course not.
Speaker 1:It's a joke, but the guy works on a ramp, I guess.
Speaker 2:We got a chart here from Orin Hoffman. Yeah. He says, insane growth. What an amazing company. And he's showing the flock safety ARR chart from Sakura.
Speaker 1:Look at
Speaker 2:this. We got to have the soccer guys on sometime
Speaker 1:Oh, yeah.
Speaker 2:Because they have some of the best insight. We got a fact check. Adcock came out and said that
Speaker 1:Oh, yes.
Speaker 2:Figure is the number one most in demand stock in the private markets which I think is categorically incorrect based on my insight into the market. But I would like to have Saker on to talk about what are the sort of they do this research, heavy research on private companies, kind of pulling out random different data sources and putting it together nicely. And, yeah, I would I would I would imagine they would have something to say about that. But
Speaker 1:Yeah. Mean, YC company, Flock Safety, we've talked about them before. 200 k in revenue in ARR in 2017, growing to 285,000,000 in 2024. Wow. That is a lot.
Speaker 2:And I wonder what they do next. I can talk briefly about Persona, who's the founder of Rippling. Oh, Sounds like he had a was really in a pickle over the weekend. This was yesterday at 6AM. A lot of people sent this to us.
Speaker 2:I like when there's just something extremely dramatic, people send it to us. Yeah.
Speaker 1:I'm like Yeah. I get some of these texts and I'm like And I'm like Is this a text story?
Speaker 2:Cover it, but it's not necessarily top of our list. But it sounds like he was had some
Speaker 1:you got to pay attention when there's a billionaire on the That's always an interesting story.
Speaker 2:Billionaire on the run.
Speaker 1:Something like that. I don't know.
Speaker 2:Close to.
Speaker 1:It's close to We
Speaker 2:just spend like ten minutes analyzing like dilution Dilution. Ownership.
Speaker 1:Well well, Green Oaks came in at this valuation. They wanted 10% dilution.
Speaker 2:And then they the SGB thing and they had
Speaker 1:to take They added that. Kind of
Speaker 2:an emergency round of And were
Speaker 1:they fifty fifty when they started the company? We don't know.
Speaker 2:We we don't. We don't really know. Yeah. But anyways, he's going through divorce, had a bunch of issues over the weekend, but they've been resolved, I think. So I was happy to cover that now.
Speaker 2:He sent an update post.
Speaker 1:Yeah. So, I mean, the high level here is that Persona posted a massively viral thread, 17,000,000 views, 68 k likes. He said that he's going through a divorce, and he's on the run from the Chennai police hiding outside of Tamil Nadu. He had a rough go with his wife who he was married to for ten years. They have a nine year old son.
Speaker 1:Their marriage broke down, and his wife was having an affair. He, was accused of a bunch of crimes. The police came for him, but it sounds like he's been more or less exonerated from all the accusations and is now, and is now safe and sound. And, fortunately, the kid is unharmed and I think that's the silver lining of what really matters here.
Speaker 2:Yeah. We got a post from Will Brown. He says, bro.
Speaker 1:This is why we do the show.
Speaker 2:Last night was a deep seek moment.
Speaker 1:Funny because like that makes sense and the whole deep seek thing, the whole reason that that phrase makes sense is because people were saying deep seek is a Sputnik moment. Yeah. It's like now last night it was a deep seek moment. I love it. The internet utterly
Speaker 2:snapped. We Did we kind of miss coverage a little bit on deep deep seek?
Speaker 1:There is a new version of deep seek out but I don't think it was as revolutionary. It was much more incremental and it didn't have the narrative of, oh, it was built for $10 in a shed with, you know, screws and hammers. Yeah.
Speaker 2:It doesn't hit the same.
Speaker 1:It doesn't hit the same. You have a bunch of fake news around it.
Speaker 2:Yeah. They there are so there's also the new Baidu model that they're they're training. Right? Or no, it's Jack it's Jack Ma with with Ant.
Speaker 1:Well, speaking of someone as handsome as Jack Ma, we got I'm John Masada in the building. Welcome to the show. There he is.
Speaker 2:No. Crazy intro.
Speaker 1:How you doing?
Speaker 2:What's going on? How are
Speaker 1:you? Good.
Speaker 5:I just dunked my head in a a bowl of ice.
Speaker 1:Oh. I hope you use serotonin, man.
Speaker 2:I hope you got your banana on there too.
Speaker 5:Yeah. My banana's key.
Speaker 1:You can't get you can't start your morning without banana on your face. No. No.
Speaker 5:Just some banana. Put all over, you know.
Speaker 3:Are you
Speaker 1:still lifting like crazy? Last time I saw you, you were dead lifting, like, 500 pounds or something like that.
Speaker 5:I lost a lot of weight. You know? It's just like you get you get to a point where it's unhealthy. It's it's not exercise. It's it's fucking killing you.
Speaker 1:It's like Yeah. Gets a little risky. The risk of injury gets up there, but you gotta be able to, you know, break a sweat every once in a while.
Speaker 5:You see Daniel growing Daniel's tweet is like, you wanna look like shit and feel like shit, start power lifting.
Speaker 1:Yeah. Because you just, oh, well, if I wanna get the number to go up, I better bulk more and then just put eating so much. Yeah. I still I still maintain some
Speaker 5:of the muscle, but but, you know, just trying to work out for longevity and health. Yeah.
Speaker 1:Anyway, thanks for joining. Can you give us just like a brief overview of like where Replit is, what you're working on, how's it going?
Speaker 5:Yeah. So, Replit, kind of like the, genesis of it, has always been how do you make it so that, you know, programming is more accessible to more people. It's had a profound effect on on my life. Like, you know, coming from, from Jordan, growing up there, you know, lower middle class family, being able to come to The US, come to New York, initially, and then move to the Bay Area and be able to build a billion dollar company, that's outrageous, and it shouldn't be possible. But, the reality is that, you know, we have this math massive wealth engine machine that's called the Internet.
Speaker 5:And for a long time, you know, it hasn't really been possible for a lot of people to to kind of take part in that. And there's the I think Peter Thiel said, like, the paradox of the Internet. It was supposed to sort of decentralize wealth, yet somehow concentrated into into Silicon Valley. Mhmm. But I think what we're seeing now is finally the tools of creation are becoming more accessible, and that's really been my my my mission.
Speaker 5:And so, initially, RepLoad was about let's get people learning how to code, and, I think that was a good pursuit, but people don't wanna code. The reality is I
Speaker 1:I spent the
Speaker 5:last whatever working at Codecademy and and Replied. I mean, it's good. I think we taught a lot of people how to code. And at Replied, we built a ton of infrastructure around how do you set set up a virtual machine, the runtime, install packages, automating all of that, and all the way to deployment. But the really, the big unlock was the agents, you know, putting an agent on top of all of that.
Speaker 5:We were the first agent in the market to be able to configure, services, databases, deployment, and go all the way to, to deploying, deploying an app, and it kind of transformed our business just in the past seven months.
Speaker 1:Can you talk a little bit about the the benefit of knowing how to code and how that collides with vibe coding. I see a lot of people that are like, oh, I vibe coded and it didn't really work. And then Andre Karpathy is like, I vibe I vibe coded it, and it worked great. And I'm like, there's probably a little bit of a difference between when Andre Karpathy is vibe coding and when someone who's completely nontechnical is vibe coding. Like, is there still value to learning to code in 2025?
Speaker 5:I I think there I think there is. But, I mean, it depends, John, about what is your prediction about where AI is headed. Right? Like, if, you know, in the up case, like, you know, what Dario just said recently, all code will be AI generated. You know, I assume this optimization path we're we're on where agents are gonna get better and better and better, you know, the answer would be different.
Speaker 5:The answer would be no. It would be a waste of time to to learn learn how to code. But, like, you know, you could have different predictions, and I think different people will will make different assumptions. I I I'm at this point, like, sort of agents pilled. You know, I I the the progress we're seeing with agent, we just we just, are rolling out v two.
Speaker 5:Agent I've never seen a sort of, like, an AB test as we're rolling out. I've never seen metrics in my entire life. I worked at Facebook, other places. We're moving metrics like crazy just be just by improving the agent. Like, a %, five hundred % on certain metrics on on success that users are having.
Speaker 5:And so I think where vibe coding goes wrong is when a a beginner is using Cursor, some other platform, great product, but they don't give them guardrails. Like, you know, there there's the guy that lost six months of work on on Reddit. There's the guy on Twitter that leaked his API keys. Like, on our applet, we do get commit for you. You don't have to worry about that.
Speaker 5:We hide the API keys in, like, a secure vault. And so I think a lot of it goes to, hey. These beginners should not be using a lot of these tools, and instead, they should come to places, like like Replit. But that being said, I'm I'm very bullish. Like, know, I sort of changed my answer even, like, a year ago, I would say kind of learn a bit of coding.
Speaker 5:I would say learn how to think, learn how to break down problems. Right? Learn how to communicate clearly, you know, with you know, as you would with humans, but also with machines.
Speaker 1:Can you tell me some stories about, like, success stories from Replit? Maybe, like, this the what's possible as a solo dev today? I mean, we're seeing Peter Levels. Io do crazy stuff, but what are you seeing from the from the most, successful replet users?
Speaker 5:Let me start with the with the business cases because I think those are are kind of really profound because we've always had, like, micro entrepreneurs, like, make money and, you know, it's certainly accelerated massively. But a hundred plus year year old company, Sears, I don't know about you. I didn't know they they continue to exist, but they they have this, spin off called Sears Home Services. About a year ago, they hired a team to like, a more trendy sort of tech team to get them off of Cobalt, which is whatever a hundred year old programming language. And they were able to do it very quickly.
Speaker 5:And then after they've done that, you know, basically, most most companies as they're modernizing, they go adopt a bunch of SaaS tools and no code tools and local tools and to become, a modern company. They actually skipped all of that and went to went to AI. And their operations team, which manages the kind of field workers that go out and every day kind of do house repairs and all of that, they start they started building AI tools. So one AI tool that they have is, like, the worker would would go and would talk to the AI, and it would optimize its their route. And with you know, that made it so that they're making a lot more money.
Speaker 5:And now that team everyone in that team started building AI tools. And so you have this ops team that's highly levered that are able to move business metrics, And and they leapfrogged an entire era of computing and and landed on on AI agents, and now they these are the generalists that are building the business. And I think this is a view into into the future where firms would not be made of, like, you know, SDR and, like, account yeah. Whatever. It's gonna be like, I'm a sales generalist.
Speaker 5:Right? I can do all that stuff because I can spin up AI agents that can do all these things.
Speaker 2:That makes sense. How how do you think about balancing the sort of needs and demands of the different types of people and customers of the of of your platform? Right? You have somebody that comes on. They're sort of early in their sort of like entrepreneurial journey.
Speaker 2:They build something, but then suddenly there's this moment where they become a business and once you become a business and you're sort of like servicing. So like, you have the challenge of having so many people on your platform and they and some of them can end up wanting different things. What it what what it, you know, just what does it look like in terms of, you know, you wanna be able to continue to service these users over time while still making sure that Replit is the best place for somebody to sort of, like, start their journey.
Speaker 5:We we've taken a a difficult approach approach and perhaps not not the Right? The reason I've been working on it for my entire life is because, you know, what what I try to do is, like, build a an end to end experience where we infuse a lot of taste and decisions and choices on behalf of customers. You you actually, you had that in the past where, like, the Apple ecosystem kind of makes a lot of decisions for developers, and even Windows as much of as we we, you know, look down on it. But, you know, Visual Basic was a great product. It made a ton of decisions for you and, like, you know, a lot more people were making things, at the time.
Speaker 5:And so then you had the open source movement, and the open source with was this radical, disruptive, you know, bottoms up thing where, there's hundreds competing libraries and a hundred competing ways of doing things, and that create a lot of mess and create a lot of power. But now getting started and doing things programming became a lot more difficult. Like, imagine setting up a modern web, you know, app, let alone trying to set up like a Python environment. Like, if you mess up your Python environment, the best thing you could do is throw your laptop in the garbage and get a new one.
Speaker 1:I've been there. It's been miserable. It's terrible.
Speaker 5:So, you know, so so you had this, you know, bottoms up innovation and kind of like the early hacker lingo, you had the cathedral versus the bazaar. So the Windows ecosystem is the cathedral. The open source ecosystem is the bazaar. And so in my mind, we'll build let's build cathedrals made made of bazaars. Like, I think open source is awesome, but let's actually build tasteful experiences on top of that.
Speaker 5:So my work at Facebook, I was part of the early React team. You know, I was working on the tooling there and special especially, like, React Native, we made it so that in five minutes, you can spin up a Hello World app.
Speaker 1:Mhmm.
Speaker 5:As if you're trying to do it using Apple and iOS that would take you, you know, hours perhaps. So, you know, now fast forward, to to Replit, and we built basically the you know, all the way from nuts and bolts to the UX of what it means to to make software. And so that's been a lot harder, but but I think you end up with this general purpose horizontal tool that can satisfy a lot of needs. The challenge, of course, is, like, positioning and marketing this thing. You guys know as entrepreneurs, like, people like to do to pick one product on the market.
Speaker 5:But look back on the history of computing, typically, the the the best products that end up being a core part of our lives are the general purpose horizontal product.
Speaker 1:There's kind of a narrative that's floating out right out there right now that companies that are aligned with the AI growth trend are seeing extremely fast rates of adoption. You're seeing companies get to a hundred million ARR faster than ever before. The risk that people are kind of worried about is that maybe churn rates are going up as customers test a new AI tool and then kind of bounce around. They're using cursor one week and then ClaudeCode the next week, and then they're bouncing to this one. What are you seeing, and what do you think is happening?
Speaker 1:And do you think there's any, any merit to that fear in the market or on x right now that maybe the AI revenues that we're seeing are not as sticky as previous SaaS installation cycles?
Speaker 5:It's certainly suspicious. I mean, it who tells you differently is sort of and I was a little worried about our growth. Like, is it is it gonna go away? What is going on? Like, this is, like, a little too fast.
Speaker 5:And I think, you know, we really start focusing on the other metrics that really matter, which is the revenue quality, retention, things that more advanced companies are thinking about, like net dollar retention. We actually have above % net dollar retention even for our consumer plan
Speaker 1:Mhmm.
Speaker 5:Which is probably unheard of. But, you know, I I think that I think maybe ARR is becoming a bit of a vanity metric, like how fast you can grow the ARR. I think you want to make sure you're providing an awesome service and also make sure that people just wanna stay on your platform. I think especially on the Versus Code Wars, the switching cost being so low is is gonna be a challenge for them. You can go from Copilot to Windsurf to Cursor in, like, five minutes, same project.
Speaker 5:Yeah. Quite Like, it's one click. You can open the project. And so they're gonna have to find a way to differentiate. The great thing about Replit, we provide this really great convenience.
Speaker 5:And so if ain't broke, don't fix it. You deploy something on Replit and people people really tend to stay.
Speaker 2:That makes sense. Internally, I'm I'm sure the entire team is using Replit all, you know, all day long. Is there still a place for traditional prototypes or are you is everyone across the team sort of like doing rapid prototyping of features which is obviously something that your end customers use or is there still like, hey. Let's just, you know, make this in in Figma and kind of align around it, first?
Speaker 5:There there's certainly a a place for for Figma. I think there are, first of all, there are things that are tough to prototype, and there are things that you wanna do very, very quickly even even faster than than than sort of any kind of software prototype. And it depends on how people think. Like, I think designers still would wanna would wanna canvas to to think. I think these products might end up growing in that direction where maybe you go to Rupland, you you initially have some kind of canvas, and that kind of results in a a piece of in an application.
Speaker 5:But right now, I I still think there's a there's a place for Figma. But the way I think about what Rupland is doing to to our organization, I hope more and more companies, is, like, everyone is highly levered. Like, we just built you know, agents are new, and part of the exciting things is that no one knows how to build agents. Yep. There's no tracing tool, you know, like an APM, like a New Relic or or Datadog for agents.
Speaker 5:So we built our own internally, and, you know, a cup a couple people on our on our team spent, like, a week using Replen and vibe coding. This really great infrastructure tool that has saved many, many hours of engineering. We have even more exciting story, we have someone in HR that couldn't find an org chart tool that really fit what she wanna do or it was too expensive. She spent three days. She spun up this org chart tool with, like, connection to ADP and and and sort of, versioning history, and it's amazing.
Speaker 5:She never coded. Right? So I think the way to think about it is, like, how to increase the productivity in your company. And less about, like, oh, what should we displace? You know, I think I think these these tools will have their place.
Speaker 2:Yeah. How do you do you think about sort of buying software as someone that enables the creation of software when, you know, you've obviously been building Replit for a very long time. Ten years from now, you guys are in market for a new CRM. You're talking to the big players. Is is building it yourself just become a part of that sort of like RFP process where the team is like, okay, well, we can build this.
Speaker 2:Like, this is, you know, what we think is gonna it's gonna cost to, you know, basically build it, maintain
Speaker 1:it It used be the biggest bear signal if a startup was building their own It was like, oh, no. You're way over your skis. This is gonna get Yeah. Terribly wrong and you're gonna be maintaining this thing for years. And you actually don't have a special you're not a special snowflake in this case.
Speaker 1:Just use Salesforce or something. But It is a make sure
Speaker 5:that, like, NIH, not invented here syndrome.
Speaker 1:Yep. Totally.
Speaker 5:So, yeah, I agree. I so I think I I I thought quite a bit of, like,
Speaker 3:future of SaaS.
Speaker 5:I think the the the question is, like, if you can conjure up a SaaS product, can like, is there, even a future there? And then we do see this every time I wake up on on Twitter. I see someone using Replit and replacing a piece of software that costs them 15,000, a hundred thousand. I just retweeted one this morning. And so there's a lot of, I think, vertical niche specific SaaS tools that are generateable very easily.
Speaker 5:Even with the the today's technology, let alone, like, a year from now, I think you'll be able to kind of generate them, especially on a platform like Replen, which gives you all the cloud services involved. I think there are ecosystem SaaS products that are fairly hard. So I think think think about RipLink. How embedded into your company as, like, the, what do they call, the the, like, system of record.
Speaker 3:Yeah. Yeah.
Speaker 5:And and Salesforce, think about the ecosystem and the developers that
Speaker 1:they have. Yep.
Speaker 5:So I think if you're starting a SaaS business today, you wanna go against the Silicon Valley dogma of focus. You wanna build a Chinese style company. Just I think what Rippling is doing. And and I think, I I think this idea of, like, being generative and may you know, having larger pieces of software, I think it's gonna become more important in the future. So I think I'd be really worried about vertical specific SaaS, but I think I would bet on those horizontal SaaS companies.
Speaker 1:Well, we gotta ask about the Vercel drama. We talked to Guillermo earlier this show. What's going on there? What's your take? Can you break it down for us?
Speaker 5:Well, you know, I, someone asked me, do you do you plan on supporting Next. Js and and Replit Agent? I said no because, we wanna bet on something like Veat that is open, like, community built. And the way Next. Js has been trending is that it's optimized for Vercel.
Speaker 5:They disagree, but it is actually not a controversial statement in the larger community. There's a project called OpenNext that makes it so that, you know, Next. Js is deployable on more platform. Matt, the CEO of Netlify, agreeing with me.
Speaker 1:Mhmm.
Speaker 5:The larger community feels like, you know, Next. Js is is perhaps more tied to Versal than they would like to admit. And I think they overreacted to my comments, and and and they and they strizened my my comments. I think it would have been a let less of a a story if they, you know, they don't overreact to it. And and look, Vercel is an amazing product.
Speaker 5:It's an amazing brand. They've done a great job managing a lot of open source projects, not just Next. Js. And for me, water on the bridge. Like, you know, I you know, I I think, you know, emotions get get high on on Twitter and you saw the name calling and, you know, I wish them really the best.
Speaker 1:Yeah. How is how is Next different than the React relationship with Facebook? I mean, with all these big main core frameworks, you're kind of if you're in Angular, you're aligned with Google. If you're with React, you're aligned with Facebook. But has has Facebook or Meta done a better job of kind of releasing that into the community?
Speaker 2:They're not trying to monetize it as aggressively.
Speaker 5:Well, not at all. Not not monetize. Yeah. Look. I worked I exclusively worked on open source Mhmm.
Speaker 5:At at Meta. And the the advantage and disadvantage of working in open source at Meta is that there's no direct tie in to to to the bottom line. Right? So we were not trying to monetize React. The so far, they haven't monetized Llama in terms of, like, selling an API.
Speaker 1:Sure.
Speaker 5:And so, generally, as long as they are sort of they're using it internally, they're gonna maintain it and support it and get some value out of the community and mind share support. Now the disadvantage of that, we actually weren't ever able to, like, make a complete product because, like, if you go to Google, and, you know, use, you know, Flutter, I think that thing, is actually much more polished of an experience because they have a direct, incentive advance the Android ecosystem, for example. And so Facebook, built really cool pieces of infrastructure, but the UX around them are bad. So you have companies like Expo building on React Native to make it a better experience, companies like Vercel building on React to make it a better experience. And these are amazing companies, and I think that's how it should be.
Speaker 5:I think where it gets tricky is when you end up also maintaining the the core core software and really tying them together.
Speaker 1:What do you think about kind of the Ben Thompson aggregation theory around there might be a new company to emerge from the AI boom that is the hub for these vibe coded apps and websites and games? Obviously, it for a long time, it's felt like web development services, if you could call it that, were very much it was bifurcated. Like, was Shopify, which is a power law winner, but then there was also Squarespace and Weebly and, like, dozens of other companies that did quite well. But if there's a new aggregator emerging and Nikita Beer has written about this, like maybe there will be one company to really break out and be the the hub for vibe coded n 64 level games, that would be very valuable. It would also be more of a winner take all environment.
Speaker 1:How do you think that that plays out in your category?
Speaker 5:Look. I I don't really that's not the model for for for our business. Like, the the way I think about it, in the early computing era, you had the mainframe. It was the domain of the expert. And then you had the PC, and it became possible for anyone to use computers.
Speaker 5:And that ended up eating our economy essentially because that's how disruptive technology work. And so in, you know, the modern era, the modern software engineering is also the domain of the expert, and now it's become so that anyone can can make software. Initially, it looks like a toy, vibe coding, game games, and things like that. But I think it will fundamentally change and transform the the economy. And and my model for what we're building, it's let's build an Excel.
Speaker 5:Mhmm. It should be fun. You know, we we do a lot of things that, you know, may make it fun. We actually build a three d gay gaming stack, but but the model is like, can a billion people use it to you know, as part of their their everyday work, to to build businesses, to to really be a core piece of the infrastructure in the economy. And the idea that, you know, it's it's gonna be a Roblox, I don't see that as as interesting.
Speaker 5:I mean, Roblox is a great company. Mhmm. You know, maybe Roblox is the aggregator for for vibe coded games. But I think it's really not the the the big prize. It's like, you wanna build a trillion dollar company, you gotta think a little bigger than that.
Speaker 1:I love it.
Speaker 2:Yeah. Do you do you have any do you have any words words for your doubters? Something you said is like the next big thing looks like a toy. It's been this idea within Silicon Valley that you can apply to you could have applied it to crypto. This was Chris Dixon's, I think, original thesis.
Speaker 2:It still feels like, you know, Riplet is this billion dollar company now, but I still think your doubters and your haters would say
Speaker 1:No. It's a toy.
Speaker 2:Oh, it's just a toy, like it's, you know, kids making apps or whatever, but do you do you like that that people still kind of underestimate this potential? Is that part of what creates this sort of the the opportunity for the next ten years is people not realizing like the tsunami that's kind of about to hit the industry?
Speaker 5:Yeah. I think I it used to bother me, but but now I think it's it's actually an advantage. And I think, you know, we when, you know, when we're at the height of, like, AI trendiness and it obviously was early, you know, we were the first outside of Copilot to train a code model. Yeah. We're, like, this company in the city, and we're growing fast and, you know, hired a bunch of executives that think are part of the the sort of the hype kind of Silicon Valley.
Speaker 5:They jump from one company to another. And, you know, last year, you know, I did the founder mode. I cut the team in half.
Speaker 1:Wow.
Speaker 5:Now, like, 65 people. I moved us out of the city. We're now in in Foster City. Literally, there's no other sort of there's actually nothing out there. It's sort of a desert.
Speaker 5:And and so we have this nice sort of of office that we're turning into a campus. We have we have food. We have all that. And and and and the team here is a sort of a tight knit team. There's a selection effect on who joins Replit.
Speaker 5:If you are smart enough to figure out that Replit has this amazing potential in the future, then we would want you on the team. If you think if you really think it's a it's a toy, it's not worth it's not worth your time, then then great. And so I I think these things that just sort themselves out.
Speaker 1:Awesome. Well, thanks for joining. We love to have you. We'll have to have you back soon.
Speaker 2:Yeah. It's I'm I'm incredibly excited to watch what you guys do for for the next year, the next two, the next five, the next ten. And yeah, I would love to have you on again in the future sometime soon.
Speaker 1:Yeah. This is fantastic. Thank you for for doing
Speaker 5:this show. It's it's been it's been really cool.
Speaker 1:Thanks so
Speaker 2:much for joining. Hey, man. Cheers. Awesome. Do we do we have another guest?
Speaker 1:We have a surprise guest for
Speaker 2:you folks. Surprise guest. Is he ready?
Speaker 1:I just sent him the link. He's jumping in in just a minute and he should be all queued up. We'll we'll we'll go through some more posts while we wait. Oh, Bryce Roberts bought two cars. We gotta talk to him.
Speaker 1:We gotta have him on the show, figure out what he what he bought. Bryce Roberts, over at Indie VC says, bought two cars today. One dealership wanted me to come down to the lot, get on a bunch of calls, and refused to send me basic info over text. The other was willing to send me anything I needed and requested requested over text and email. Can you guess which one got the sale?
Speaker 1:And it's not a Tesla. He went he he said he's done being a Tesla customer. Not a political statement, just that his lease is up and his Model x was absolute trash according to him. I wonder what he did to the car, but, we'll have to talk to him about what car he chose. I'm hoping it's a Dodge Demon and a Lamborghini l m o o two.
Speaker 1:I think that would be a perfect fit two car garage for Bryce, but we'll have to talk to him about it. But it really is a an interesting take. I we talked to to the car dealership guy, and I've wanted a car dealership that yeah. I mean, sometimes I just wanna buy a car. I just wanna click a button and they don't really care.
Speaker 1:Jordy likes to go to the dealership and take a look at everything. I completely disagree. I wanna just push a button and have it arrive, which is maybe stupid, but I don't know. I I certainly enjoy it. And let's see if I'm ready when you are.
Speaker 1:So we are going back into the twenty three and me news, and we'll give some more context on this. But I like that we're able to be responsive.
Speaker 2:It's actually crazy that Kean single handedly bankrupted three and me. Yeah. He was barely in market for
Speaker 1:Well, I mean, it doesn't it's not a surprise because he did the TBPN interview. And I'm sure I'm sure the market saw it. He had
Speaker 2:very well been
Speaker 1:a catalyst. Said, hey, you know, if he's gonna be in the temple of technology every week, let's just get out of the stock. Let's just call it. So let's bring him on down. Kian, how you doing?
Speaker 1:There he is.
Speaker 6:What is up? We have
Speaker 1:Welcome to the show. Are you guys celebrating? I mean, it's kind of it's kind of depressing. It's kind of macabre to celebrate on when your when your rivals go bankrupt, but what happened?
Speaker 6:Listen. Let let let's put this tweet up, John. We got a tweet up here. I put up late last night. I think it was around 2AM eastern or so.
Speaker 6:Maybe one, 2AM eastern.
Speaker 1:Okay.
Speaker 6:I saw the announcement. The first thing I have say to 23andMe is, thank you. Yeah. Because the reality is, you
Speaker 5:know, still
Speaker 6:have the shoulders of giants here. Right? We've done the shoulders of giants. All companies do, you know. You go from Blockbuster to Netflix.
Speaker 6:You go from, you know, Blackberry to the iPhone. You go from MySpace to Facebook, and now you go from 23andMe to Nucleus Genomics. Right? The industry is wide open. Nucleus is years ahead, and we're gonna seize the moment.
Speaker 6:But before I talk about that, thank you to 23andMe. You did a great job building the foundation, and now it's time for something new. That's the reality.
Speaker 1:So, yeah, talk me through the key. It seemed like your post was really focused on the on the technology and the price to sequence and the difference between shotgun sequencing and full sequencing. Talk to me about that. How different is the technology? And, also, why can't 23andMe just use the same tech as you?
Speaker 6:Yeah. Great question. So pull up have another tweet here, John, that actually I just put another tweet right out here that I think
Speaker 3:I
Speaker 6:should pull up on the screen, give some further context on what's going on and what 23andMe users should actually do. It's currently riding high on Twitter. But the difference between microRNAs, whole genome sequencing, it's massive. It's like a horse versus a car. Right?
Speaker 6:You're talking about Treadmillisecomology missing millions and millions of genetic markers. Effectively, it's not actually useful for any really disease risk assessment. So it's fundamentally different here. The same question is the classic innovator's dilemma's problem. Right?
Speaker 6:Why can't this big company do this thing? Well, because imagine, you know, 23andMe is a castle. They have to pull out the foundation of their castle. Everything has to change. Technology, product, regulatory, infrastructure.
Speaker 6:Every single part of three had to change to actually embrace whole genome sequencing. This is capitalism at work. We love capitalism around here. 23 means dying because we couldn't adapt. Nucleus is sending because we are embracing the newest genetic technology.
Speaker 6:But it actually, I think it even goes beyond technology. Yeah. Go ahead, John. Have something to say?
Speaker 1:No. I I I just wanna push on that more because, like, if I'm like, I I I like you. I'm not gonna compete with you. But if I was a potential buyer, I would buy 23andMe, rip out shotgun sequencing, drop in, you know, call up, I don't know, Illumina or something and figure out how to do whole genome. And
Speaker 6:You you would independently derive nucleus. That's the beauty.
Speaker 3:Yeah. Exactly. You have to
Speaker 6:have do the models.
Speaker 1:Yeah. Yeah. Yeah. Maybe maybe the de novo approach is is correct. And and, I mean, that's why I'm bullish on you.
Speaker 1:But, you know, at the same time, it just it it I I'm still not really understanding, like, why is it such rocket science for them to just op offer, oh, hey. We're on v two now. We we're we're like, you still spit in the tube. You still pay a hundred bucks. You mail it to us.
Speaker 1:We just put it in a different machine. It doesn't seem that complicated to me. No offense.
Speaker 6:Well, it's a massive informatics change. It's a massive regulatory change.
Speaker 3:Okay.
Speaker 6:It's it's extremely nontrivial. It's kinda like being like, you know, horses both get other places. Why can't they just make an engine? It's it's fundamentally different, you know? But really, the thing that twenty three got wrong, it wasn't just technology.
Speaker 6:It was also actually the philosophy of the business. They really viewed data gathering as a means to make drugs. But because it's such a small sliver of your DNA, you actually can't really make drugs off of it, which ended up making that such that the customer wasn't the customer, the customer was the pharma company. And I and I wanna say here something really important, which is a lot of people ask me right now, what should I do with my 2020 data? What should do with my 2020 data?
Speaker 6:Well, first and foremost, you should move it to a HIPAA compliant environment. Right? Like, one of the most shocking things about '23 means it's actually not HIPAA compliant. Right? It doesn't follow the gold standard clinical regulations that ensure your data is safeguarded.
Speaker 6:So Nucleus, for example, we are HIPAA compliant. We are a physician ordered clinical grade test. We make sure no genetic or protected health information is shared with any third party. It's very similar to, like, going to your doctor's office. Another thing to know, and I hope you have the thread up here, which is, you know, we outlined some of these things is we you know, 23andMe, the reality is that it's actually been illegal since 02/2008 for any insurance company, any health insurance company, well as any employer to use your genetic information.
Speaker 6:That's been illegal for two decades. It's very, very important to say that. So there are some safeguards in place, even though not 20 not HIPAA compliant. But if you're a 23 user and you're listening to this, you do two things. One is you download your genetic data, secure your genetic data, and then two, which is microarray data, small snapshot of your DNA.
Speaker 6:But two, you should probably put that in HIPAA compliant environment. You can actually DM me. I can help you doing that. Some customers are currently uploading their DNA to Nucleus currently because they know that we're gonna take very good care of their DNA because it is, of course, ultimately all about the patient.
Speaker 2:Talk about, there's not total clarity right now. 23andMe is not HIPAA compliant. I'm trying to understand 23andMe in a bankruptcy environment is the value of them as an asset. Pretty damaged brand. There's not a lot of brand value necessarily.
Speaker 2:What are some of the risks of the types of for that business? It seems very possible from our initial research that somebody could buy it and with the explicit intent of not even rebooting the business, but just monetizing the underlying user data.
Speaker 1:Is the value of the data or just the revenue stream? Because I'm sure that they have marketing campaigns running. I'm sure they're bringing in customers and charging them a hundred bucks a test or something. There's some there's some normal business going on there. It might not be profitable, but, like, maybe you could cut costs and get to profitability.
Speaker 1:Or is this is this nightmare scenario of someone buys it just for the data, is that at all credible?
Speaker 6:Yeah. So it's a good question. I think one thing this Nucleus actively is looking into right now, considering whether it makes sense you know, earlier, I'm I'm sure you remember, you know, we explored the possibility of acquiring 23andMe, and we're looking into right now whether that would make sense to go and see what we can do and how we can help in this situation. I think the thing to remember is that, again, this is microarray data. It's a small sliver of someone's DNA.
Speaker 6:A lot of the most critical genetic markers that you wouldn't want someone to know about simply do not exist in the data. And that cannot be overstated. Because it is microarray data, it is a small sliver of your DNA, it misses the most fundamental health risks that someone could have. So in some respects, it's a little bit overblown when people are worried. Sometimes there's this funny narrative.
Speaker 6:People are like, I'm in 23. I learned that, you know, my pee smells like asparagus. You know, that that gets out. I mean, that's bad. It should never have gone out.
Speaker 6:But, like, you know
Speaker 1:Not that big of a deal.
Speaker 6:Yeah. Yeah. Yeah. You wonder like know,
Speaker 3:like Yeah.
Speaker 1:Yeah. It can't be both doomsday, they're getting my DNA, and also the product isn't that good and it's not that reliable.
Speaker 6:It can be both Exactly. Yeah. Exactly. Would encourage
Speaker 2:you to think about this if you should do it.
Speaker 6:There's there's two really extreme narratives about twenty three minutes. Actually, the change I look at it, it's like, oh, I learned nothing. It's like, why did you think you learned nothing? Because it's the smallest of your DNA. That's like one narrative.
Speaker 6:Then it's like, oh, it's the end of the world. My data's shared. It's like, well, actually, you know, the reality is that it's the smallest of your DNA. Obviously, no data should ever get breached. No no one's saying that.
Speaker 6:Of course not. But of course, it's it's micro data. And so what I recommend is download the data, knowing that, one, there's federal regulations that protect you and protect all people who do genetic testing, and that there are actual regulations that exist in clinical genetics companies like Nucleus that can safeguard your data. Right? It's like going to your doctor's office.
Speaker 6:So that's the thing I think that should be top of mind, for consumers right now.
Speaker 1:You you mentioned that that they were potentially selling data to pharmaceutical companies. Again, that's kind of this weird narrative where if the data is not that valuable, then who are they selling it to?
Speaker 6:Is that But this is also this this is one of the again again, this is a great point. This is one of reasons why 23andMe failed because, originally, the founder, Angie, said, okay. Listen. We're gonna use this data. People are actually she has a quote on the record.
Speaker 6:People are gonna donate data to 23andMe. In other words, one of the reasons why 23andMe failed is they never wanted to build a true consumer health application. It was never actually about, hey, can we provide you with life saving or medical insight? It was about, hey, because he was really a geology business for a long time. Hey, we're gonna get ancestry on.
Speaker 6:We're gonna get as many people as possible. We're gonna take this data and then go to GSK. They worked with GSK, for example. The problem with that is, this is the thing they underestimated, because it is a small slip of your DNA, it's fundamentally not useful for drug discovery, which caught up with them. Because then if your business model is based off collecting a lot of data to then make drugs, but it's microarray data, it's kind of it doesn't work.
Speaker 6:Right? The customer doesn't want what you're buying, which is why eventually twenty three collapsed. So in some sense, it's a technological problem, which is, again, it's the smallest of your DNA, but also, I think it's a philosophical problem. They didn't the customer wasn't the customer. The pharma company was the customer.
Speaker 6:Right? And so that's why people say, I didn't learn anything about it from 23andMe. 23andMe didn't really their goal was not to actually to really help you and your health. And and that's another big shift from 23andMe to Nucleus. Right?
Speaker 6:We're HIPAA compliant. Our technology is far more advanced. We actually wanna give you medical grade insight that helps you live longer, helps you have healthy family as well. And then also, we wanna continue to build out that platform beyond just genetics, blood, wearables, urinalysis, full body MRIs, and beyond into a true consumer health application. Imagine '23 when we shipped, right, how far ahead that would be.
Speaker 6:They'd twenty years ahead of everyone. Right? Consumer health has just recently hit the zeitgeist. By '23, they would have had a head start, but that wasn't the customer. And so it's not just technological difference, it's actually a very strong philosophical difference as well.
Speaker 2:How, how are they such a, you know, they they have this sort of one time purchase problem, that that could contribute to challenges from a business standpoint. It becomes much harder if you sort of get this upfront, you know, payment. And then, you know, I'm assuming the average 23andMe customer just like, you know, gets testing done, you know, maybe references back at some point. But why why don't you think they were able to avoid bankruptcy given the scale that they were at? Right?
Speaker 2:This is a company that does hundreds of millions of top line revenue. You would think they would be able to figure out some economic like, they've they've been in trouble for a long time. You would have thought that they would have gone found you know, Anne would have gone founder mode and and, like, figured out a
Speaker 1:way to It sounds like she tried and and is now bidding on the business to go founder mode maybe.
Speaker 6:I I always say that there's no such thing as a genetics company. There's only such thing as a health care company. And the reason why people always say 23andMe is one time. 23andMe is one time. Right?
Speaker 6:There was actually no difficulty for 23andMe to add in other diagnostic tests and build a more consumer health application that was vertically integrated. But, again, their customer was the pharma company. Yeah. They actually when you they they didn't care that it was one time. They got your DNA.
Speaker 6:And that is the fundamental difference. It's funny if you could have solved that problem. Mean, you look at some companies today, you know, some blood testing companies are built on top of Quest Diagnostics. Twenty three could have slapped their fingers and launched that product in one minute. Right?
Speaker 6:But of course, that wasn't the cost, that wasn't the business model, that wasn't the strategy. So this is a good example where strategy meets technology, which eventually results in failure. Right? You have the innovation dilemma's problem, genetics has really changed. The twenty Me has been around since 02/2006.
Speaker 6:Two thousand '6, the cost of immuno genome was, you know, 10,000,000 a sample. Today, nucleosides are a couple hundred dollars. It's one of the greatest technological shifts ever. Right? And so all these pieces together, you have, you know, 23 Me Coatsy, which is sad, but I also think it's the sign.
Speaker 6:It's time for something new. It's time for a true health consumer health application.
Speaker 1:Can you talk a little bit about Ancestry.com? They were acquired for by Blackstone for 4,700,000,000.0. It seems like that business is doing pretty well. Again, not a genetics company. Particularly, they have their little niche in Ancestry.
Speaker 1:People really love that. They become experts there. But how does that business play with you and Great question. 23andMe?
Speaker 6:You know, it's interesting because one time a very, very wise investor of ours said, he said retention isn't about the product, it's about the use case. K? It's a very sharp comment. And I think Ancestry is a good example of that because genealogy is a very super high touchpoint, business. People love genealogy.
Speaker 6:They love looking at who their ancestors are. The people who, like, literally spend their entire hobby actually around this. Right? And Ancestry capitalized on that. They realized that genetics was a mean to do better genealogy.
Speaker 6:23andMe never realized, are they a genealogy business? Are they a health business? Are they a drug discovery business? They never got that right. For Nucleus, we use genetics to help people live long and have healthy families.
Speaker 6:The value prop is very clear. It's not about DNA. DNA is a means to accomplish some end goal for the user, which is namely better health and having a healthier family. Right? That is a fundamental, difference.
Speaker 6:And to your point, Answers is a multi billion dollar business. Natera, people say genetics businesses don't work. Natera is a clinical genetics business. It's about $20,000,000,000. Okay?
Speaker 6:So genetics is in its absolute infancy stage here. And I really do think in the next decade, you're going to see the rise of a consumer health behemoth. And that consumer health behemoth is gonna have a whole genome, entirely of someone's DNA at its foundation, and it's gonna impact not just someone's health, but again, also their family, and Nucleus is building that future.
Speaker 2:So is it is it possible then that 23andMe had become this sort of toxic brand, and even the pharmaceutical companies said, you know, we we like the data they have, but we we don't wanna kind of like even mess around here because there's huge potential for blowback. Right? I imagine, you know, there there's there's some risk there. Is that part of why they
Speaker 6:Well, pharma companies worked at twentieth and me, but because the data is such a small sliver, they realized that there was something to be found. The the the most important thing for drug discovery in a genetics context is finding rare genetic markers because there's actually a leucidated mechanism. To identify novel rare genetic markers, you need a whole genome file. Right? Because a microarray, again, is such a small bit of your DNA.
Speaker 6:If your DNA is a thousand page book, it's funny that you only said one pages. One page. You can't actually get anything out of that. So it didn't work from a drug perspective business. It didn't work from a consumer health business, hence, it's collapsed.
Speaker 6:There's a great, actually, chart here. I don't know if you guys it's an old tweet, Pete of mine. Maybe you guys pull it up later. It's on Bedrock. Does does screen sharing work?
Speaker 6:Can I share my screen?
Speaker 1:I think you can, actually.
Speaker 6:Oh, here we go. We're gonna try.
Speaker 1:Yes. Screen sharing.
Speaker 6:Technology first year. Whatever you use screen
Speaker 1:share is live, so do not share Okay.
Speaker 6:It's live. API keys. Ignore the tabs. There's a lot of tabs up there. It's actually
Speaker 1:We can't actually have Crop out perfectly. Yeah. Let's do
Speaker 3:the tabs. Okay.
Speaker 6:So here we have, you know, this great thing. I shout out to Bedrock. Right? They have this narrative violations. Right?
Speaker 6:Clean tech is dead, you have Tesla. Dave not so he's fads, you have Tinder. Consumer is dead, you have Canva. And then, of course, the most recent one, artificial intelligence has been overhyped, under delivered for ten years, you have OpenAI. Sure.
Speaker 6:I will tell you what is next in 2024. Popular narrative right now is consumer genetics is dead. Yeah. And then right now, Nucleus is OpenAI. That is what's going on.
Speaker 1:Let's go. Pump the Let's ring the size gong for
Speaker 6:Ring it.
Speaker 1:Beyond on Nucleus.
Speaker 2:Do you have any idea how quickly do you have any sort
Speaker 1:of read on how quickly this
Speaker 2:is gonna get resolved?
Speaker 6:Well, you know, Nucleus might be the one resolving it, if you know what I'm saying.
Speaker 1:Listen, I'm a pilaster. Of our
Speaker 2:big Some
Speaker 1:of our
Speaker 6:big never some of our our big boy investors is my you know, they currently text me saying, yeah, what can we do here? And you know what?
Speaker 1:Do here.
Speaker 6:You know, we we tried for a quarter of a billion dollars. You know, what's $50,000,000? Hey.
Speaker 3:You have to
Speaker 1:ask Cheaper every day. Getting cheaper every day.
Speaker 2:There we go.
Speaker 6:I mean That's great.
Speaker 1:Well, good luck to you, Kian. I hope you can pull it off. I know you'll be successful regardless.
Speaker 2:Thanks for jumping on.
Speaker 6:It. Great
Speaker 2:to be I hope this gong is gonna get hit for a very specific reason soon.
Speaker 1:Absolutely. Good luck to you.
Speaker 6:Thanks, guys.
Speaker 1:Take care.
Speaker 2:Talk you soon. Bye.
Speaker 1:News. I love some breaking news and I love having founders hop on to help us break it down because we are going full golden retriever mode. I don't understand anything about that but that's why we get the experts on. That's the way the show Trust the experts, folks. Trust trust the seed stage founder pumping his No.
Speaker 2:Don't even trust yourself. Don't even trust yourself. Trust experts. Exactly.
Speaker 1:Do You wanna finish out the timeline right now? What do you
Speaker 2:think Yeah,
Speaker 1:we can do
Speaker 2:a little bit. Thought this one from Liz Wessel. This has to be the frothiest VC market for seed and pre seed I've seen in my tech lifetime, 2012 to present. It's becoming truly absurd. I
Speaker 1:Ramp investor. Seed stage. Wow. She did the seed round.
Speaker 2:Crazy. Yep. Goated. I haven't seen anything crazier personally
Speaker 1:I mean
Speaker 2:than 2022.
Speaker 1:I was gonna say crypto stuff was really crazy.
Speaker 2:Like, the last the last company that I committed to was like a $60,000,000 post seed round, but the founder had sold his last company for hundreds of millions and I don't care. Like but again, I'm not an institutional fund that's Totally. Trying to, you know, cares about ownership targets or anything like This
Speaker 1:is good context from Jason Lemkin. He says, I would be fine with it if public multiples were higher. And so, yeah, I mean, this is why we had Logan Bartlett on the show to kind of break down what's happening in the public markets because there should be some sort of tracking between these two. And and it's when there's a really crazy disconnect that you think, hey. Maybe the public markets are a leading indicator on what will happen to venture valuations.
Speaker 1:But at the same time, there's a lot of companies that are getting to hire ARRs faster than ever, and it'll be interesting. The weirdest outcome, I think, would be that, you know, seed and pre seed deals, they get overpaid for, and they don't produce the same number of power law outcomes. Like, maybe there's not a a single trillion dollar company that comes out of this vintage, but all of those companies wind up producing like a hundred million of EBITDA and they're like good businesses. And then like the funds kind of perform anyway. Like that would be a very strange outcome.
Speaker 1:It would look nothing like Venture has ever. Yeah. But to see a to it would be very interesting to see a Venture Fund Vintage 2025 produce a reasonable IRR without a Power Law winner in the portfolio. Yeah. I have no idea if it's possible, but it'd be interesting.
Speaker 2:The to steel man that
Speaker 1:Yeah.
Speaker 2:There's potentially we've accumulated in the last twenty five ish years. Mhmm. The know how to repeatedly build valuable software tech, just technology businesses One investment. And in that scenario, paying these expensive prices because you have this incredible team. Yep.
Speaker 2:And maybe you only get a three x on that one investment, but you get a bunch of other three x's and collectively you get a two x fund and that becomes venture.
Speaker 1:That'd be very interesting.
Speaker 2:And there's nothing if if that happens and I don't I can argue against it easily Yeah. As well. But if that happens, it's not necessarily bad because ask any dude
Speaker 1:in private equity that has like,
Speaker 2:you know, just been doing these sort of two x funds for however many decades they've done very well.
Speaker 1:Yeah, of course.
Speaker 2:And we want higher success rates for founders and teams too, even if it's lower terminal sort of like exit values.
Speaker 1:It's also interesting that, I mean, OpenAI is maybe positioned itself as like potentially the power law winner of AI. Like, people are clearly underwriting that deal at a future valuation of like a trillion dollars. I think it's going to be a big consumer tech company. And no one's really concretized how, like what the source of monopoly power will be in that company. Like there's not really a network effect yet at least.
Speaker 2:There's No, the value is
Speaker 1:a becomes It's just an aggregation
Speaker 2:theory thing. It becomes a verb
Speaker 1:and it's It's like Google. Competition is always a click away. But you accumulate so much customer support that you just
Speaker 2:Data and by nature of the usage, the product gets so much better.
Speaker 1:I would think so too.
Speaker 2:And then,
Speaker 1:you know. So maybe we're bullish, who knows? But I mean, it's certainly not cornered resource because the LLMs are commoditized now. It's not really scale because everyone can serve these. All the hyperscalers can serve these.
Speaker 1:It's really just that attention. Anyway, we should have Augustus on to talk about this next one soon. Yeah. From Lee Zhen.
Speaker 2:I actually want to have him on to talk about his
Speaker 1:Oh, yeah. The debate with Did you
Speaker 2:listen to
Speaker 1:Ron DeSantis? Or or, his his his
Speaker 2:He was debating Ron?
Speaker 1:Well, Ron DeSantis Has been
Speaker 2:trying to ban cloud seeding.
Speaker 1:Has been trying to ban cloud seeding. And RFK recently came out saying, I support what Ron DeSantis is doing. Like, part of the MAHA movement is anti cloud seeding. And Augustus came out very strongly saying, like, no, RFK. Like, don't do that.
Speaker 1:Like like, this there's more nuance to this argument. And so we should unpack that. We should unpack his testimony, which was very interesting. And we should also have him talk about this, which is that China is erasing deserts from its map. The first time I ever met Augustus at Josh Steinman's house having some cigars was he just comes up to me and he's like, oh, yeah.
Speaker 1:Did you know that, like, the Gobi Desert is going away? And I was like, what are you talking about, dude?
Speaker 2:It's the Gobi.
Speaker 1:And he's like, yeah. China's erasing their deserts. And I was like, how? And he was like, yeah. They're basically just planting tons and tons of trees, and that's exactly what this video shows.
Speaker 1:He says, by far, 65,000,000 MU of desert has been greened. That's around the same area of Denmark. And you can watch this video, and it's crazy because it's just, like, literally just sand dunes and then the most verdant, lush greenery you've ever seen. And it just looks like, wow. Like, I would never wanna live in the desert, but I would absolutely live on this beautiful lush farmland.
Speaker 1:Like, imagine plopping like a nice farm farmhouse on that. That's just like the American dream. And we could do that with our deserts in America. Yeah. And so we talked to Augustus about this earlier saying, you know, after you do cloud seeding, like, is there a tree planting startup that needs to be built or will that be your company?
Speaker 1:And he was kind of saying, hey. Maybe it'll be a different company. But I want this to happen, and I wanna figure out what the economics of this business are. Is it just a handout from the from the Chinese government? If so, do we need to do that in America?
Speaker 1:If there is there a way that you can do this just with the free market? That would be amazing. You
Speaker 2:know, you Yeah, this ties into the terraforming stuff with the what's that? The salt and sea. Yep. If we can get water back into that bad boy then everything around But we have some breaking news. I wanted to pull it up.
Speaker 2:I don't even know what's It's not actually breaking. Breaking. It's the Nucleus Genomics team.
Speaker 1:Oh yeah.
Speaker 2:They were all posted up watching Kian come on the show. So Ben, pull it up if you can. Look at the team here.
Speaker 1:Oh, that's amazing.
Speaker 2:All meetings were canceled but shout out to the team. Thank you for keeping our Yeah.
Speaker 1:Thanks for watching.
Speaker 2:Appreciate data safe.
Speaker 1:That's great.
Speaker 2:It's great having Kean on the show. He's Yeah. He's definitely built for television. We talked about this. We talked about this earlier with Oh,
Speaker 1:Lulu, like what is his format? What's the format? He's a good poster, but he's great in
Speaker 2:a dream. Just come on and rock and roll.
Speaker 1:And and and rub the rub his He says thinks about acquiring a multi former multi billion dollar company.
Speaker 2:Yeah. It's great. Absolutely fantastic. Well, that's a great place to end the show. Yeah.
Speaker 1:Thank you for watching.
Speaker 2:Go leave us a five star review. Put an ad for your business or your fund
Speaker 1:Put it
Speaker 2:on the show. Into the If
Speaker 1:you're breaking news, if you're raising the big money, if you think we should raise raise ring the size gong for you, give us a call. We'll have you on the
Speaker 2:show. And we have a number of founders this week coming on to We
Speaker 1:can their
Speaker 2:fundraisers. So I can't wait.
Speaker 1:Yeah.
Speaker 2:It is a beautiful
Speaker 1:We're gonna have to set the minimum threshold and then just raise it. It's like, oh, 50,000,000. That's, you know, that's a Tuesday for us. Yeah. Call us when you're raising 80.
Speaker 2:Exactly.
Speaker 1:But right now it's a golden opportunity for anyone who's
Speaker 2:It is.
Speaker 1:Making making waves in venture.
Speaker 2:It's a beautiful week to get to work in and around technology.
Speaker 1:For sure. So many interesting stories.
Speaker 2:And if we keep up this pace, we will be doing a Dom episode probably next week.
Speaker 1:I can't wait.
Speaker 2:We're at 26 k. I can't wait. Six k out.
Speaker 1:Let's go. Let's go. Thank you for everyone who's been supporting us.
Speaker 2:Thank you everyone. Really appreciate it. Have a great rest of your Monday. Have a great day. Bye.