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Technology's daily show (formerly the Technology Brothers Podcast). Streaming live on X and YouTube from 11 - 2 PM PST Monday - Friday. Available on X, Apple, Spotify, and YouTube.
You're watching TVPN. Today is Monday, 06/16/2025. We are live from the TVPN UltraDome, the temple Of Technology.
Speaker 2:The fortress of finance.
Speaker 1:The capital of capital. We have a great show for you today, folks. It's Lamar and one of our absolute boys. I've never met him in person, but he's a legend. DHH is in the race.
Speaker 1:I mean, race is over, but still, we will we will have him on the show soon to break it down. I'm very excited for that. Can't wait. In other news, The Wall Street Journal is in absolute turmoil over Iran and Israel. There is a new war in The Middle East.
Speaker 1:Israel races to reshape region with few checks. Iran, Israel put energy sector into new peril. I'm thinking of having somebody on the show to talk about oil markets. I think that might be an interesting downstream thing. We're not a deeply political show, but, obviously, there's defense tech angles
Speaker 2:We monitor situations.
Speaker 1:We do monitor situations.
Speaker 2:We've been known to monitor situations.
Speaker 1:The poly markets. There's a lot going on.
Speaker 2:Getting into situations, this one is a good one to start.
Speaker 1:Do you think this is the good first situation?
Speaker 2:It's pretty intense.
Speaker 3:I don't
Speaker 1:I would completely disagree with that.
Speaker 2:It's a it's a
Speaker 1:Of all the situations that you could start off with if you're getting into monitoring, this this is for advanced monitors, in my opinion.
Speaker 2:For sure. But, you know, get throw yourself into the deep end.
Speaker 1:Yeah. I guess. Yeah. It it is a bit of a deep end situation.
Speaker 2:Swim. You know?
Speaker 1:Yeah. It is sink or swim with this situation. But fortunately, we have Polymarket where you can monitor all of the situations.
Speaker 2:How is poly market tracking US odds of of actually
Speaker 1:No action. I think that is a market. There's a number there's a number of of interesting poly markets. I I had them pulled up yesterday.
Speaker 2:Yeah. So it's hovering at 32% on US military action against Iran before July. If this starts spiking, I think we should all start paying attention because all of I think many of the actions from Israel to date poly markets on them would just start going Yeah. Insane vertical.
Speaker 1:The journal's covering it left and right. There's some other stories in here. Investors are wary of the roller coaster. We're still in the kangaroo market. Some move into cash or foreign companies to avoid market volatility.
Speaker 1:Very, very tricky. There's also an interesting article somewhere in the journal I was reading about, which was that that politics is increasingly dividing the portfolios of investors. So so Democrats are are more likely to perceive that the market will degrade, that the economy will do poorly, and Republicans are more likely to assume that the market will do well. And so, they're like, basically, right now, Republicans, because the Republicans are in the White House, are more bullish Yeah. Which is very interesting.
Speaker 1:And, you know, there's an old adage that like you should keep politics out of your portfolio Yeah. Because like the market
Speaker 2:doesn't care about about politics very often. Do things that make money. Exactly. Exactly.
Speaker 1:That was interesting.
Speaker 2:Bucko Capital Bloke had a fun post from over the weekend. Oops. Mike down. Mike down.
Speaker 1:Mike down.
Speaker 2:On Saturday, he posted the start of World War three is bullish because we now have a new positive catalyst, the eventual end of World War three. And he posted he quoted that this morning and said, LOL, because there was some positive news.
Speaker 1:That they that the World War three
Speaker 2:might be over? Yeah. Ron was signaling that allegedly signaling that they were interested in figuring out some type of ceasefire.
Speaker 1:It would be good. Certainly hope for We hope for, you know, positive collaboration between all of all parties in the global economy. And, I mean, there are some interesting developments. There's there's the potential of a new trade deal. There's the potential of a new geopolitical order.
Speaker 1:You're really struggling with that, Mike. Yeah. Crank that thing. This is a grip strength test. This is why the Lone Ranger sent us those grip strength.
Speaker 1:The grippers. Jordy's really struggling.
Speaker 2:Awkward angle. Yeah. We'll see how long this
Speaker 1:works. Yeah. But back in the tech world, there is some more exciting, more positive news. Meta Oakleys are coming. This Shiel says, this makes sense.
Speaker 1:Luxottica owns both Oakley and Ray Ban, and Meta is reportedly investing $5,000,000,000 for a four stake. Luxottica is a fascinating business story. The founder, Leo Del Vecchio's, family still owns one third. The guy was an orphan who became a metal worker making parts for glasses, ultimately becoming the largest listed company in Italy.
Speaker 2:It is really interesting to think about how if if Meta can basically corner all of the What was all of the most iconic of the most iconic frames which they can do through Luxottica if they do figure out some type of exclusive over time through that investment and
Speaker 1:Does Luxottica just own all the major brands?
Speaker 2:It basically own everything. People's and everything. Every time you buy
Speaker 1:Something is all glasses, you
Speaker 2:think you're buying, you know, some unique brand Yeah. Heritage, Luxottica.
Speaker 1:It's interesting. We should we we should dig more into that company because they they don't create all the retail.
Speaker 2:Well, yeah.
Speaker 4:There's a lot of, like,
Speaker 1:sunglass hot retail stuff coming.
Speaker 2:I mean, they are big glasses. And that created the opportunity for Warby Parker
Speaker 1:Yep.
Speaker 2:Because
Speaker 4:they
Speaker 2:Yeah.
Speaker 4:They're the
Speaker 1:ones that manufacture everything.
Speaker 2:Basically this entire Luxada who had verticalized from brand to production to the actual medical side as well.
Speaker 1:Interesting. Well, let me tell you about ramp.com. Time is money saved. Both of these corporate cards, bill payments, accounting, and a whole lot more all in one place.
Speaker 2:There's been some wild rumors circulating
Speaker 1:Wild rumors.
Speaker 2:About ramp. But we will we will have more on that front
Speaker 1:in days,
Speaker 2:including some special guests.
Speaker 1:Shalom says he can't stop thinking about the Coinbase sponsored military parade.
Speaker 2:I mean, it really was an iconic image, you know, the stage at the parade Yeah. And then coin brought to you by the US Army, brought to you by Coinbase. Usually, you see the army sponsoring things like UFC and things like that for
Speaker 1:recruiting You
Speaker 2:don't typically see them
Speaker 1:The other way around.
Speaker 2:Recruiting sponsors. Yeah. And we you were saying off air this morning, it's kind of feels in some way counter to crypto's, you know, origins and roots as a sort of libertarian technology.
Speaker 1:Most Bitcoiners would say, I'm accruing Bitcoin so that you cannot tax me. And what can you not do as soon as you stop taxing me? You can't pay for the military. Yeah. Yeah.
Speaker 1:But, of course, in the libertarian, you know, extreme, there are still, like, private military forces, I suppose, and different structures. I don't know. I'm not I'm not super into all the all the crazy crypto.
Speaker 2:Coinbase could Hardcore libertarians.
Speaker 1:But but Coinbase is not that's not the median Coinbase customer anymore. The median Coinbase customer is just like an American investor who wants to diversify. And that's very much a lot.
Speaker 2:For me, was interesting because there had been so much it was the two hundred and fiftieth anniversary of the army. There had been so much excitement and noise around it and then, you know, I guess credit for Coinbase to Coinbase to getting the presenting sponsor slot.
Speaker 1:Yep.
Speaker 2:You'd think given how much we spend on our military, they could just say, no sponsors on the two hundred and fiftieth birthday. That is odd. I'd be like, you know, there's certain friends of mine that I would I would maybe want their birthday party to be sponsored by ramp, but it's a, you know, different context.
Speaker 1:Yeah. It is it is funny.
Speaker 2:David Senrosberg is when when we celebrate
Speaker 1:his birthday, Jimmy He's a sponsored
Speaker 2:by sponsored by Ramp.
Speaker 1:It is yeah. Yeah. It is funny. Like, why why why do like, what did the Coinbase sponsorship pay for? I guess it it takes money out of it.
Speaker 1:It it does it takes the burden off the taxpayer, which is certainly nice. I mean, I I like the idea of paying less taxes for military parades. I I guess that's good. Should just
Speaker 2:start putting ads on your on your ID card.
Speaker 1:They should put ads on the military uniforms. Your California ID. You should be able to see a Nimitz class.
Speaker 2:Brought to you by Verizon.
Speaker 1:You know, you should be able to see a massive aircraft carrier just engraved with corporate logos everywhere. Full NASCAR livery. Full NASCAR livery on on the submarine. Yeah. On the Triton class.
Speaker 2:Yeah. Thing doesn't get photographed much.
Speaker 1:But when it does
Speaker 2:But when it does
Speaker 1:know it's brought to class
Speaker 2:carrier, you know, all the you you basically get all this free marketing through the open source intel accounts. Totally. Totally. Posting pictures.
Speaker 1:And, I mean, a lot of those military assets, they go into the next Transformers movie. They go into the next Top Gun movie. When you see Tom Cruise step into the f 16 or the f 35 and it's got the ExxonMobil and McDonald's logos on it, boom.
Speaker 2:Fire me up.
Speaker 1:Yeah. Fire me
Speaker 2:up. Fire
Speaker 1:me up. They're not taking that out in
Speaker 2:post. Okay.
Speaker 1:I think we gotta
Speaker 2:Someone listening, this is your life's work.
Speaker 1:This is
Speaker 2:Bring out of home advertising to the military. Maybe it's ad quick.
Speaker 1:Maybe it's ad quick.
Speaker 2:Out of home advertising made easy
Speaker 1: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. I have a request for startups. Maybe.
Speaker 1:Maybe maybe we can get Tyler to work on this. We didn't give him a task today, but we do have He's doing normal work today. Okay. Sorry to disappoint. Here's my pitch.
Speaker 1:You know, you studied physics, so you might have to recruit some biologists for this. But the story, he he we we were thinking about having him day trade, so that's why he's got a day trading background, but we didn't really get that through. So, anyway, here's my request for startups. So the story of GLP one, glucagon like peptide one, I think that's what it stands for, Ozempic, Wagoovie, Mounjaro, Wagoovie.
Speaker 2:That's the proper
Speaker 1:pronunciation. Wagoovie, Ozempic. These these these fantastic weight loss drugs that are absolutely blockbusters. We have some more news about the patent, which was very funny this weekend. You might have seen.
Speaker 1:The whole origin story of GLP once is that the Gila monster is a animal that doesn't have to eat very much, And they figured out that if they extracted the saliva or venom, they could distill something from that. And that was kind of the the inciting research point to go and actually understand GLP ones and then ultimately create
Speaker 2:because the Gila monster has some weird way that it eats. It has, like, a very unique metabolism.
Speaker 1:Yes. Exactly. And so my request for startups is to do the same thing but with the saliva of a golden retriever. So I wanna take the saliva from the golden retriever, extract that, and create a GLP one type shot Yep. That when you when injected, would make you friendlier.
Speaker 1:Yeah. So we're trying to up up regulate friendliness.
Speaker 2:Basically, productizing golden retriever mode.
Speaker 1:Yeah. Yeah. Exactly. Exactly. So Tyler, would love a deep dive.
Speaker 1:We'll check-in with you afterwards. I wanna I wanna understand, you know, what it takes to build the golden retriever the golden retriever mindset.
Speaker 2:People are always talking about bio biohacking. Oh, I wanna be more focused. I wanna be stronger. Yes. I wanna have more energy.
Speaker 2:I wanna sleep better.
Speaker 1:What about friendlier? What about hotter? What about dumber?
Speaker 2:Yeah. These are What about better
Speaker 1:getting chasing Exactly. Relentlessness.
Speaker 2:So
Speaker 1:figure it out. Figure out who the top biotechnologists we could possibly talk to on the show to see if this is feasible, figure out what it'll take, and give us a breakdown at the end of the show. Speaking of the show, we have a we have a fantastic lineup. We have Jon Jumper from Google DeepMind coming on, Christian Garrett from one three seven Ventures. We're gonna debate the a whole bunch of topics in late stage, growth stage venture with him.
Speaker 1:We have Aaron from Lightspeed, and we have Joseph Kastram.
Speaker 2:SSENP. Wanna see Aaron's name in their deck. Yeah. Right? You remember that quote?
Speaker 2:Oh, yeah. This was in the 2021 era. He had he had sold his company to Apple. It became the Apple Card. And Oh.
Speaker 2:Fintech guy. Basically, people would just come to him and be like, I can I give you half a point of my company? And they just wanted to see his name in their deck. They thought it would give him an edge. And I'm sure in many cases, it did.
Speaker 2:But I'm excited to have him on later today.
Speaker 1:Very excited. Gary Tan has some news. Pano raised a $44,000,000 series b for their wild wildfire early detection, eyes in the sky startup. Wildfires have only become more fierce over the years, and now we have software, computer vision, and smart cameras to stop them before they become giant and unstoppable. Fantastic.
Speaker 1:I mean, a lot of companies were started out of the last batch of wildfires where the sky turned orange in San Francisco. I think that was 2020, 2021, something like that. And it's good to see that someone's been grinding on this. I haven't even heard of this company before. There was that other
Speaker 2:Are they MAP company. YC
Speaker 1:must be. Or maybe Gary's just spreading the love across across Silicon Valley.
Speaker 2:Or, yeah, it's possible Gary did it pre Potentially. YC.
Speaker 1:But, obviously, very exciting. We showed the
Speaker 2:present sense there. You you've seen the footage of Talked about of after the Palisades fire. They were rewatching this, like, ultra low res footage, like, trying to figure out where it started. Yep. It's it's all these, like, sort of research labs Yep.
Speaker 2:I think that maintain camera footage. Put it in four k. Let's get it in four k.
Speaker 1:Let's get it in four
Speaker 2:people kind of better understand
Speaker 1:what's actually happening. Aperture radar going. Let's do a lot of different things. I mean, this is this is one of those things where, like, for wildfires might not be an for wildfire. They they they were testing wildfire, the wildfire fighting tank and stuff.
Speaker 1:But they've been Andoril's been so focused on the military specifically now Yeah. Because they really have an an like an edge there
Speaker 2:I don't know about
Speaker 1:the tank history. Oh, you didn't know that?
Speaker 2:They wanted to make a tank
Speaker 1:that could fight fires. Yes. An autonomous tank that could go fight wildfires. They brought in Jamie Heinemann from the Mythbusters to help work on it. They built it.
Speaker 1:And then I talked to Palmer about it and he said that there was a lot of pushback around like job displacement and unions even though they would need plenty of people to, like, man these and, like, manage them. Yeah. But but it was it was a very complex situation to get through. And so they wound up scrapping that, and it's probably good that they did because now they're in submarines and Fury and Roadrunner, and they have, like, major, major contracts and major, major, like, serious jobs to address directly within the DOD. And so just
Speaker 2:focusing wanna start experimenting with hubris, they can expand into a category like wildfires. Right? But for now, they seem It's
Speaker 1:obviously adjacent, but this feels like something where, you know, it's like flock safety. Like Yeah. Yes. It's like androil adjacent, but it's kind of its own thing. And so you're not just gonna get rolled immediately.
Speaker 1:So congrats to the Pano team. We'd love to chat with you and help protect our houses because we live in Pasadena and Malibu, and we are subject to wildfires all the time. Anyway, if you also wanna protect yourself from risk, go to vanta.com, automate compliance, manage risk, and prove trust continuously. Vanta's trust management platform takes the manual work out of your security and compliance process and replaces it with continuous automation whether you're pursuing your first framework or managing a complex program. Okay.
Speaker 1:JD Ross.
Speaker 2:Vanta.com.
Speaker 1:Cofounder Opendoor, I believe. I've chatted with him a few times. He says, I couldn't find a single notable founder with a degree focused in entrepreneurship. I expected at least one outlier given the number of undergrad programs, but no. Zero.
Speaker 1:Interesting. Did you study entrepreneurship? What you said?
Speaker 2:What's this comment from an account you muted?
Speaker 1:This is this is something we can't click. So I can't even show you.
Speaker 2:We'll never know. I guess we'll never know.
Speaker 1:This is the JD Vance thing.
Speaker 2:But he muted
Speaker 3:you and
Speaker 2:Miles Strong.
Speaker 1:Yeah.
Speaker 2:Yeah. I I I wonder how many actual undergrad programs there are. How many undergrad
Speaker 1:Entrepreneurship programs? It's just hard because like so much about entrepreneurship is go and become an expert in computer science or There's more than a 130 colleges. Like, look at look at the story of of TJ Parker. It's like he became a pharmacist and then he was uniquely suited to build a company around that pill pack. Yeah.
Speaker 1:And you you like, just starting with entrepreneurship and then you have to go learn something about a particular industry that you wanna disrupt is much, much harder in my opinion.
Speaker 2:Yep. In many ways, YC is the undergrad program for
Speaker 1:I agree.
Speaker 2:Venture backed entrepreneurship.
Speaker 1:I agree. Yeah. So unnecessary, I'd say, wind them down. Take all the entrepreneurs and start teaching them art history. They'll be
Speaker 2:more successful. That's how you get a real edge in the in the new economy. Yes. Well, you have a nice post
Speaker 1:here. Oh, this is fantastic. Aidan Burke putting some positivity on the timeline. August Roding has such a kind, intelligent eye. And it's a picture of a beautiful horse.
Speaker 2:Really does.
Speaker 1:And wouldn't you agree? Such a kind, intelligent
Speaker 2:Muscular development, vascularity on It's just a fantastic horse. As well.
Speaker 1:Yes. If you go to the next slide, there's a close-up of his horse. We gotta
Speaker 2:check with with the the building managers and see if we can have mini horses on the property. Because it would be absolutely fantastic
Speaker 4:if we just had Yeah.
Speaker 1:We need to replace the soundboard. Like like, you have the gong sound on the soundboard, but then we have a physical gong. Yeah. We have the horse sound. What if we could just say, here, throw him a carrot and he'll neigh for us on on command.
Speaker 2:A mic'd up horse.
Speaker 1:Mic'd up horse.
Speaker 2:Well, you know, there's like proper headphones. Yeah. Yeah. Yeah. And we're just playing it like pasture meditation tracks and then it just throw him a carrot.
Speaker 1:And he goes, you're great.
Speaker 2:Okay. Ben, actually look into this. It's important.
Speaker 1:Can we get a horse?
Speaker 2:Can we get we should be at least like One horse heading zoo. Yeah. So it's keep it under five horsepower. Yeah. Okay.
Speaker 2:So Hey. We're looking
Speaker 1:for thoroughbreds. Hey. We're interested in in increasing our transportation. We're just so you know, like, it'll be a very low horsepower solution. Really one horsepower.
Speaker 2:Won't take up more than a single parking spot. Absolutely So we don't need any more parking or anything like that.
Speaker 1:Is that Okay, guys? They approve it, and we get this beautiful horse. It's wonderful. The founding engineer meme is going continues to go wild. Luke Matroo chimes in, says these founding engineer memes are about to become a five alarm fire meme for seed stage startup recruiting.
Speaker 1:Some enterprising VC content flack needs to figure out some counter programming.
Speaker 2:Okay. The meme is real. Okay. Founding engineers get about they take on almost all the risk. Mhmm.
Speaker 2:They get none of the sort of status of being a venture backed founder Sure. Even though they're taking on that that that similar level of risk. And they obviously get a fraction of the economics. Let's say, like, founding engineer gets one to five points
Speaker 1:Yep.
Speaker 2:Sometimes less than that. But maybe that's a good range. And so it is it is sort of painful. At the same time, there's a lot of people who would be a 10 out of 10 founding engineer that would be a six out of 10 founder.
Speaker 1:Agree.
Speaker 2:And six out of 10 founders don't build billion dollar companies. So what's your So a lot people are actually here's the counter programming for you, Luke Metro. A lot of people are just much better suited to go and crush it in a role and work on work under somebody who is, you know, truly 10 out of 10. And I would say it's much better over over a five year period, much better to be a founding engineer at a at a, you know, you know, culturally, you know, significant generational company Yeah. Than it is to be a six out of 10 founder.
Speaker 2:And, you know, just you probably that doesn't really Yeah. This doesn't really get you that far.
Speaker 1:It's all it's all that, like, Naval thing about, like, playing status games. Like, titles don't actually matter. What matters is equity and controlling
Speaker 2:Being a direct place.
Speaker 1:Return and Yeah. Distributions and secondary and actual financial outcome. And so, you should just take yeah. I was I was intern. I don't care.
Speaker 1:The title doesn't matter, but I got I made a lot of money. And so I was able to go on Bezl and get a fantastic Richard Mill.
Speaker 2:That's right.
Speaker 1:Everyone's like, oh, yeah. He must have been early because he's got a hitter.
Speaker 2:He's got an absolute hitter
Speaker 1:on He's
Speaker 2:got a condo on his wrist.
Speaker 1:He's got a condo on his wrist. Exactly. But but if someone's pitching you, hey hey, come be a founding engineer. You know, you're you're you're basically a founder. Be like, cool.
Speaker 1:Give me a board seat.
Speaker 2:Yeah. Give me a board seat.
Speaker 1:I'll take that title, but I also want a a full board seat. Irrevocable.
Speaker 2:First board meeting, pull the pull the lead VC to the side afterwards and say, look. I mean, what's going on here? Let's go. Let's let's get real. Let's get real.
Speaker 2:I should be in that seat.
Speaker 1:Exactly.
Speaker 2:I should be in that seat immediately. Exactly. We have the votes. Let's do this.
Speaker 1:Let's do this. Immediate hostile takeover. Day one of being a founding engineer.
Speaker 2:Yeah. Founding engineers, you know, they they go through a lot. At times, it should be okay if if they get a little unfriendly. Founder unfriendly.
Speaker 1:I mean, at the same time, like, it is nice to throw someone a title that signals like, oh, yeah. You were here from day one. You were you were you were on the founding team. You were on that initial build out of the company. And so just you can, like, signal that forever instead of needing to say it explicitly in addition to, like, I was, you know, senior software engineer.
Speaker 1:And by the way, I was early. But still, people can put that together by the years.
Speaker 2:Yeah. The founding title means my last angel investment was into a company that the guy was on the founding team of a company that scaled. Mhmm. And and he was there from $0 prelaunch to $50,000,000 run rate. And that means a lot to me because he saw the stages of iteration to product market fit, early scaling Yep.
Speaker 2:Hiring, all that stuff. And so, yeah, it it does mean something and can be incredibly valuable.
Speaker 1:If you're scaling, you should get on Linear. Linear is a purpose built tool for planning and building products, meet the system for modern software development, streamline issues, projects, and product road maps. And they have Linear for agents. Go check it out. If you're
Speaker 2:building a technology company and you don't use Linear, you're out of your mind.
Speaker 1:We've to call the board.
Speaker 2:We're going to call
Speaker 4:the board.
Speaker 1:What are We're going
Speaker 2:to contact your board. We're going
Speaker 1:contact your If
Speaker 2:you find out that you're building a technology company and you don't use Linear, expect
Speaker 1:We're gonna we're gonna have the VCs on the show.
Speaker 2:Gonna Maybe flagged here.
Speaker 1:You know we talk to a lot of venture capitalists. Probably some of them are on your board. We're gonna pull them to the side and say, what's going on? We need we need new leadership. We're normally against firing founders, but this is the one exception.
Speaker 1:This is the exception to every rule, and this is the exception. Have you seen this company Pop Mart?
Speaker 2:I have not.
Speaker 1:It's it it it is insane. Okay. So they have kind of, like, quietly blown up to it's this Chinese company, toy company, basically. And they they're worth, like, 20 or $40,000,000,000 or something.
Speaker 2:Are they public?
Speaker 1:Deck of Corn. Yeah. Public on the Hong Kong exchange. And always let the companies
Speaker 2:that aren't critical to national security go public.
Speaker 1:Yep. And then
Speaker 2:the ones like Huawei For some reason.
Speaker 1:Some reason. But this company is fascinating because so my cofounder at at Lucy and Soylent in high school, we had this economics class. And for the economics class, you would have to try and make as much money as possible. That was, like, your class project. And so the the classic thing people would do is they'd, like, go get a bunch of, like, Chipotle burritos and then, like, resell them.
Speaker 1:So they'd buy them for, like, $6 or whatever, and they'd resell them for, like, 20.
Speaker 2:Different era.
Speaker 1:Different era.
Speaker 2:You're gonna make me shed a tear. I know. I know. $6. $6.
Speaker 1:Something like that. But they they they do, like, the family plan, the big one, then divide it up. It was, like, a very basic just, like, reselling of something, like, seeing, like, the arbitrage. Well, that's all
Speaker 2:business. Right?
Speaker 1:Yeah. Yeah.
Speaker 2:Make something Exactly. Price and you
Speaker 5:sell it.
Speaker 1:So that was kinda like the default that people would do, would just like buy one thing and try and resell it on campus where you couldn't get it. But in but his project was he sold he auctioned off a mystery box. And so he had he had this mystery box, and and it was, like, wrapped. And he would hold it up at, the class meetings, like, the assemblies, and say, hey. We're auctioning off this this this.
Speaker 1:And I remember all the new consoles were coming out. Like, there was the Nintendo Wii and the PS three were both coming out at this time. And and so they would make the team behind this would make all these, like, illusions to, like, maybe there's a PlayStation side. It'd be like like like, we think you'll love it. Like, PS, three of us will be in the courtyard selling tickets later.
Speaker 1:Just like wink wink, nod, nod. And so the meme became like, oh, there's gonna be like something crazy. It'll probably have like a $400 value. Like, you can you you could buy a ticket for
Speaker 2:just You can buy multiple tickets too.
Speaker 1:Can buy multiple tickets. So a bunch of people bought like a lot of tickets. So they made like a couple thousand dollars. And and so they would have made a decent margin on if they'd actually given it away like a PlayStation. But it was just a bundle of firewood inside and a book on how to manage your money.
Speaker 1:Like, don't make don't make financial mistakes.
Speaker 2:A bundle of firewood?
Speaker 1:Yeah. A bundle of firewood to give it something like half. So when you shook it, you would be like, oh, it's like heavy.
Speaker 2:Oh, yeah. Wow.
Speaker 1:Was it was fantastic. Yeah.
Speaker 2:But but it but it did it did raise these
Speaker 1:like moral questions about like, you know,
Speaker 2:is this taking class action. Like, we are taking this to the California lobby. Think they
Speaker 1:might have refunded everyone. It was, like, more of a prank than anything But what's funny is that is that when when I moved to Silicon Valley and we were first talking about starting businesses, we
Speaker 2:were like, maybe we should do, like, a mystery box company. Like, there was something there.
Speaker 1:Like, mystery boxes are are are, like, you know, this interesting category of, like you know, it's it's kind of like gambling, but it's, like, in this physical. It's, like, regulated differently. And this company, Pop Mart, has made, like, $20,000,000,000 selling mystery boxes. And so the way it works is is you go and you buy their drops of these different toys, and there's different varieties. It's the same dynamics as, like, opening a opening a pack of Pokemon cards.
Speaker 1:But it's become it's become, like, absolutely massive vanity fairs reporting on it. This woman, Lisa, who I assume is a celebrity of some sort, is saying, I'm obsessed. And and it's become like, you know, there's lines down the street for these different things. They trade at a premium. People trade them on eBay and and different, you know, different, like, StockX type websites.
Speaker 1:Yeah. And it's this, like, hilarious dynamic. But, you know, at the end of the day, it's just like it's like stuffed animal toys. But they're making so much money.
Speaker 2:Pick one thing and take it more seriously than anyone else.
Speaker 1:That's exactly what they did. So the stock's up, like, 121200% this year, something like that. Absolutely ripping. Absolutely ripping.
Speaker 2:Anyway Well
Speaker 1:I'm sure they have to pay pay sales tax on all of that stuff. And they should be on Numeral. Go to numeralhq.com. Sales tax on autopilot. Spend less than five minutes per month on sales
Speaker 2:tax SaaS or an ecommerce brand, get on Numeral.
Speaker 1:Get on Numeral. Oh, this is this is a perfect segue into our first guest from from DeepMind. Google's cofounder says AI performs best when you threaten it. And Amrit says, just like real employees. I don't know.
Speaker 1:This looks like some sort of gawker. Like, just looking at the font of this screenshot just reads like, this is not a real article. Like, this is not a serious article. This is like clearly a quote taken out of taken out of But but, I mean, everyone knows about prompt engineering. This is not new.
Speaker 1:This is this is not this is not a, like, a serious threat of any kind. It's more just like, you know, fun clickbait that obviously Yeah.
Speaker 2:You wanna if you wanna play around with this, go to OpenAI or Claude and say, ChatGPT, make me a 9 figure ARR business. Yes. Don't make mistakes.
Speaker 1:Yes. Yes.
Speaker 2:Yes. And when it says, well, I'm actually just a language model and I have to just start threatening it Yes. And, you know, see for yourself.
Speaker 1:It doesn't quite work that way. Anyway, our first guest is here. We have John Jumper from Google DeepMind. Welcome to the show. John, how are you doing?
Speaker 2:Boom. Welcome.
Speaker 4:Doing well.
Speaker 1:So you are
Speaker 4:to be with Sergei.
Speaker 1:Yeah. Just this it was just completely random, but this this silly article that looks like straight out of one of those clickbait websites that's just farming farming attention constantly. But but, I I mean, I'm sure we could go into this, but there's so much more interesting stuff to talk about in the d mine world. First, would you mind giving us an update? Where are you today?
Speaker 1:What's going on?
Speaker 4:Oh, I'm at the, Y Combinator AI startup school. So this is a pretty cool event. They brought in a bunch of people with startups who are looking to found them, and they have a a great speakers list and, you know, just kind of a fun place to be.
Speaker 2:And so I'm backstage. I don't know if you can hear it.
Speaker 1:Oh, yeah. Yeah. We can definitely plant
Speaker 4:and the everything else. It's a little bit of ambiance.
Speaker 1:Fantastic. Are you giving a talk? Could you give us a little bit of background on you to kinda set the stage for the discussion?
Speaker 4:Yeah. Yeah. So I'm giving a talk. I think I'm well, I'm very certainly best known for work on AlphaFold. And really, is, doing work in AI for science and trying to solve or really predict the results of really, really hard scientific experiments and do them with AI, and we've been quite successful, hence, I'm here.
Speaker 4:So the system we've built and, you know, there's this experiment that biologists do to understand how the body works, really important to drug development, really important to a lot of other things. Give you an idea of difficulty. It takes something like a year to do. If you think of it in cost, it's something like a $100,000. And we have an AI system that we've trained that that will do within a couple of minutes, to near experimental made it openly available.
Speaker 4:And so we see it used from everything from kind of designing vaccines to finding missing aspects of our own biology to everything else. And I think it's also this kind of symbol of the promise that AI is gonna solve these really hard problems that humans don't. Right? We have there's a lot of really exciting work and how do we do things that are, you know, really impressive examples of human capability, be it, you know, writing, be it making images. But there's this other aspect of how do we use AI to solve these really, really hard problems that if we wanna solve it, we go do a year of experimental work.
Speaker 4:And that's Mhmm. That's what we at at the science group at DeepMind work on. We try and say, how are we gonna solve these really, really hard problems with AI? And sometimes it works spectacularly well.
Speaker 1:Can you tell me about the initial project spec for AlphaFold? Was protein folding the most obvious choice, or were there other targets that you thought were appropriate for deep learning? And and how how did that initial project kick off? Was it, let's go collect all the data or or let's just start experimenting on, like, synthetic data? How how did all this, like, play out in the early stages?
Speaker 4:So one thing to say is this problem had kind of stood as a crown jewel of hard problems in science Mhmm. For a long time. So something like fifty years that people had been trying to build some computer system any way you could. And I think it was kind of obvious also that this felt like a problem that AI could do something about. One answer was data.
Speaker 4:That in fact, had enormous kind of effort and forethought and expense. Scientists worldwide had basically put every structure ever solved into what's called the protein data bank. Mhmm. So for about fifty years, people had collected this dataset. The time we were doing our work was about a 140,000 structures, but it represented essentially everything.
Speaker 4:Everyone had the same data. There were some thoughts, I think, early on about, oh, well, maybe this is a good problem for optimization and combinatorial search. That didn't really turn out to be how we solved it, but there was this thought that maybe it's kind of well teed up with the methods that were looking incredibly powerful and are, you know, incredibly powerful in terms of AlphaGo and other search, style methodology. And then I think also there was actually some grassroots where there was a local group of people that were going into a hackathon at the company, kind of do whatever you want for a week And literally googling grand challenges in biology. And so that was the other way that this got started and, you know, it was on the list.
Speaker 5:And Yeah.
Speaker 4:And all of these kind of came together. And I think what it turned out to be is we didn't at all solve it the way we thought we were gonna do it. And there were many blind alleys. So we got into it possibly for some right reasons, some wrong reasons, but we stayed with it for a long time.
Speaker 1:Talk to me about the state of the art of protein folding beforehand. You mentioned, like, a year and a 100,000, But but what did that look like in terms of the actual problem of like defining the structure of a protein based on a sequence of DNA? Is this is this, you know, an undergrad or a graduate student kind of pipetting stuff and and putting it in a centrifuge? Like, I've seen some bio lab work, but try and walk me through actually what it looks like. Is it just using a different machine and pushing a button?
Speaker 1:What's driving the cost? Is it labor? Is it is it, you know, reagents and and equipment and expendable things? Like like, what was the state of the art at the time?
Speaker 4:So it's a very good question and underlying it is a false premise.
Speaker 1:Okay.
Speaker 4:You have this premise that there is a series of steps
Speaker 1:Yeah.
Speaker 4:That you're gonna execute and, you know, you're gonna maybe it's a year long, but in January, I'm gonna do this. At the January, I'm gonna succeed at that. I'm gonna go do the next. Yeah. And, you know, you can think of it the same way as training an AI system isn't just, I want an AI system.
Speaker 4:Let me press the AI button and then go get coffee. It's really about research and iteration. And so for scientists going to solve the structure of a new protein, They have this huge numbers of steps and one, like, the very first thing they have to do is make enough pure protein to study this thing. Mhmm. And I, you know, I did my PhD in biophysics and I remember sitting in a lab meeting where someone's for six months talked about how they couldn't even make their protein to get started on their experiments.
Speaker 4:And I remember it saying, if you if you talk about protein you know, making protein in one more lab lab meeting, I'm gonna start talking about my compiler errors in the next meeting. But just, like, building and doing the work to get enough product to get started is enormous. And then then you have to convince to to form this very regular crystal structure that is not at all natural. And no one really knows how to do this. They just have some ideas that maybe or maybe not work.
Speaker 4:And so they try many, many combinations and, you know, always look. Like, one that really brought home the difficulty for me is one paper. I can't remember if we trained on it or evaluated on it. I think we evaluated. And I looked in the appendix of the paper, and it said after more than a year, crystals began to grow.
Speaker 4:You have to make crystals to solve a protein structure. And so they were literally trying things, and probably that whole year, were trying things just to look in their cabinet, find out something from a year ago worked. And then after you do that, you go to a very large synchrotron, and there are many other steps. But I would say the real answer is there's wide error bars and there's enormous amounts of experimentation and cleverness. And this is why one or a couple protein structures can be a PhD.
Speaker 4:You can be doctor at the
Speaker 5:end of this.
Speaker 1:Mhmm. Talk to me about the timeline between That
Speaker 4:that kind of was done.
Speaker 1:Yeah. Yeah. Talk to me about the timeline Go ahead. Between AlphaGo and AlphaFold and the lessons from the Lisa Dahl match, the Move 37 moment, and and just the different paradigms. I mean, I remember, like, part of the beauty of learning Go is that it's this very defined system that can be simulated at an extremely high speed.
Speaker 1:It's like kind of a prime environment for this reinforcement learning strategy. What was taken? What was different? And and and how did those timelines match up?
Speaker 4:So already coming out of lease it all at a kind of company level, dimness level, people were getting interested in this question. I can't remember exactly. I think it was 2016 when the work really started. I actually joined slightly after that.
Speaker 1:Sure.
Speaker 4:The early work was in kind of can we use reinforcement learning and these models, energy functions where you're trying to treat this as a minimization problem, just a really, really hard, clever minimization problem? And I remember even, like, when I came in, it was kind of I had come from a protein background, and there's a way in which this is obviously not the right idea. In that, we don't know the full, you know, God's energy function for proteins. We don't know this thing that if you just minimize it, we're sure that's the right answer. At least if we do, it's one of mechanics that we're not solving.
Speaker 4:And in fact, the big problem is that really you needed to solve the kind of how do we how do we optimize this and what are the rules that we're optimizing under at the same time. And it turned out to be actually much more data driven supervised learning. And what really started to make the difference is when we sat down and we you know, the state of the art kind of before it was growing, there was progress within using convolutional neural networks, a certain design. You can also try transformers. They're not really much better for this.
Speaker 4:But there were a lot of kind of people trying to take machine learning off the shelf and say, I'll just apply it. This is an application problem. And I think what we did really, really well, especially in AlphaFold two, the one that really worked, is that we said, no. No. No.
Speaker 4:This is a machine learning research problem. How are we going to rebuild our kind of core components? How do we get inspired by the transformer, but build something different in order to make a system that learned really well? And we can show in fact, like, an external group did a very careful experiment where they took out the full two, and they trained it on 1% of the available data and they found it more accurate than our AlphaFold one system. So even between one and two
Speaker 2:Wow.
Speaker 4:You can see what is a hundredfold in data. And so in a certain sense, all we did was a lot of machine learning engineering
Speaker 1:Yeah.
Speaker 4:That got us a 100 fold better data efficiency than we used to be, and in fact, use the exact same data as everyone else and that we had used for AlphaFold one. And
Speaker 1:Oh, we're having some trouble.
Speaker 4:Really in these core ideas that enabled it to learn much more. Oh, yeah. I think all of these I think the ideas evolved. And still, I think, you know, there's room to play and there's all these different problems today, But it did kind of presage how important learning directly from data has become in terms of this and then RL to optimize performance and achieve other objectives.
Speaker 1:Yeah. Wanna talk about the reaction to AlphaFold in the public markets. I know you're not a public markets analyst, but I was very surprised that, you know, this this 50 year age old problem, this incredibly tough, you know, millennium challenge level problem is solved. And I didn't see biotech stocks, like, really pop. And you'd think that if you took this cost out and this uncertainty out of the system, you would see benefits.
Speaker 1:And we're certainly seeing all sorts of companies tell stories about, oh, we're using large language models all over the place, their and their stocks pop. And so, was that, in your mind, like a misunderstanding of the impact of this technology? Or or was it more that, hey. We're we're this is just one step down the path to actually increase the output of biotechnology companies?
Speaker 4:I think I think it's a very interesting question. I should say, I'm not an equity analyst. And I would actually be after this podcast, you should go back and do the same experiment for CRISPR, which is undoubtedly a big moment in biology. And I I would be shocked if you saw a pop when the CRISPR paper hits.
Speaker 1:So there there actually was a major pop during CRISPR, but it was more about, like, companies that were directly linked to it. So so there were there were a number of companies that were that were trading on the back of we will be commercializing CRISPR technology specifically. There weren't as many pure play alpha fold companies, if that makes sense. And so the I I don't think there was as much of a vehicle. And some of these biotech companies, like, they're just not traded on a cost basis.
Speaker 1:So maybe that was what was going on. It's like, yeah. Okay. You're gonna save a million dollars next year on protein folding.
Speaker 4:I think I think you shouldn't think of it too narrowly, and you wanna be really careful. So if you think about it from the $100,000 point of view, then it should already be immediately obvious that a single protein structure wasn't the gap to a drug. A drug is about a billion dollars
Speaker 1:Totally.
Speaker 4:In r and d.
Speaker 1:Yeah.
Speaker 4:And so you can already see that that in that many orders of magnitude. What I think AlphaFold I think but there are two more things that are really important. One is, and especially when AlphaFold first came out, it was unclear if we just solved a grand challenge Mhmm. Or was this gonna be a really practical system? And the practicality became much more apparent, especially in six months when it was available to everyone.
Speaker 4:I think, you know, people started to say, wait a minute. It's actually solving my problems. The other and we see it here all the time from biotechs using it. I think when AlphaFold three came out, it was apparent that the same thing would describe protein small molecule binding. And, of course, we haven't worked within alphabet and isomorphic labs.
Speaker 4:It's really about how do we take these technologies and make them better. Yeah. And I think all of this is to say one is to say really, you know, certainly one of the big drivers of cost for biotech is clinical trials. So if you wanna increase the success rate, you need to understand biology better.
Speaker 1:Yeah.
Speaker 4:I think there's been some really important work in terms of technologies either using AlphaFold or downstream of it, such as the really incredible advances in protein design. And maybe not in the public markets, but if you look at private valuations from everything from evolutionary scale to Zara to others, You've seen some really enormous funding rounds where certainly the startup community believes that this is going to hit it big. And I think you do see some effect in that you need more technologies on top of this, and it's not a single a single problem, but I think it will also make a larger and larger difference. Of course, there are more problems to be solved. And without jumping into the valuation and but you also see these strong valuations on the company's very, you know, or trying to figure out how to use this and how to say kind of this door has been opened.
Speaker 2:Mhmm. Do you think the
Speaker 4:of AI and biology and predictive biology company directly.
Speaker 2:Do you think that the FDA will be able to adapt Do you think the FDA will be able to adapt quickly enough to advancements in research at the intersection of AI and biology? Like is there anyone at the FDA that's AGI pilled and is like you know thinking five, ten years out.
Speaker 1:Yeah, how the underlying systems need to change. That's a very interesting question.
Speaker 2:Yeah, because what will be concerning is like if
Speaker 1:We have all this great technology and we can't implement it because of the Ultimately
Speaker 2:decrease the cost of drug creation if all the costs are in trials.
Speaker 1:Yeah. That's a great question.
Speaker 4:So one thing I'll say, and I'm outside my area of expertise, I don't have any contacts at the FDA, but let let me say this version of it. These these are tools that make predictions. You still check them. You don't check them by doing the exact same work as you were gonna do otherwise, but you you check the consequences. You say, if this is true, then this change or this drug will have that effect.
Speaker 4:And what you ultimately look at in terms of safety and efficacy of drugs is real world evidence. Now you look at clinical trials and they have this ninety plus percent failure rate. So you think about that as being really one of the key drivers. It's not so much are we just going to totally trust computation. We'll just do AI and because it says AI, we'll kind of believe it.
Speaker 4:It's gonna be that we're gonna do AI, and then when we go in the lab, we're gonna have a much better sense of what's really going on. We're gonna have much better predictions, and that's gonna let us do the right experiment in the first trial or the third trial instead of the hundredth trial. I think that and that that doesn't necessarily require you to shift your standards of evidence for what is evidence of safety and efficacy so much as it's about, you know, you as researchers where you have a lot of freedom on how you choose the experiments you do. How do you choose the right ones that will advance you toward treating that disease?
Speaker 1:That makes a ton of sense. Well, thank you so much for joining. We'll let you get back to it. I know it's a busy day over there at AI Startup School. I we really appreciate you taking the time.
Speaker 1:We'd love to have you back to go way deeper when we have more time to dig into everything. So thanks so much for joining.
Speaker 2:Thanks a lot, John.
Speaker 4:It was a pleasure. Thank you.
Speaker 1:Have a great rest of your day. Cheers. Talk to you soon.
Speaker 2:An absolute legend an dog.
Speaker 1:Absolute dog.
Speaker 2:That's probably the first time he's been described that way.
Speaker 1:Yes. But It probably won't be the last.
Speaker 2:Definitely won't be the last.
Speaker 1:It is it is amazing. I mean, we should have gotten in I'd I'd love to go deeper into the way DeepMind has been reorged a bit. Google Brain has merged in. They're working on a lot of different stuff. And and the science side and and the research side is something that Google has been fantastic at for for decades and continues to be.
Speaker 1:So lots to dig in there. Anyway, let's let's go back to the timeline and go through some posts. Marvin Van Hagen says, plane flying over Stanford graduation right now. Congrats. Don't work for Elon.
Speaker 1:Twenty years after Steve's stay hungry, stay foolish commencement speech. So this is like a pro Trump post? Like, they're Yeah. They they don't want you to work for Elon because they're on Trump's
Speaker 2:be extremely MAGA pill.
Speaker 1:Yeah. It's well, it isn't red.
Speaker 2:They must actually just be in favor of big government, you know, massive spending bills.
Speaker 1:That's probably what's going on there.
Speaker 2:Now I always wonder with this type of thing. I mean, this is the the person that that's gonna go through the effort to I imagine they're there at
Speaker 1:I mean, you gotta give it up for them because they're doing some outdoor advertising. Yeah. Love out of home. And so, you know, if you have a message to get out, regardless of or not, we we regardless of whether or not we agree with
Speaker 2:you Generally
Speaker 1:we always support out of home
Speaker 2:free speech And out of advertising. Exactly. Combined is is kind of the sweet spot. So
Speaker 1:So if you have a good message to send, throw it on throw it on a plane.
Speaker 2:There was a big debate on the timeline.
Speaker 1:I think this works better than than skywriting, by the way. Skywriting is potentially overrated.
Speaker 2:I I think so.
Speaker 1:It just dissolves too fast. Totally. And you can't really get a message out. But this, I mean, you look at this photo, and if you go to the next slide, you'll see it zoomed in. Like, it is incredibly legible.
Speaker 1:Yeah. Incredibly legible. And so yeah. Yeah. We should have had a competing plane there.
Speaker 1:Congrats. Please work for Elon. Yeah. Elon, where where where did
Speaker 2:you Consider applying to roles at companies like SpaceX Yeah. Boring Company, Neuralink. Yeah. Just just fly hundreds of blanks.
Speaker 1:I have been seeing stuff on the timeline about, like, oh, maybe there's, a talent exodus from some of
Speaker 2:the Elon companies to other companies. One post. I saw that.
Speaker 1:You saw that. And I wonder how real that is. You know you know, some of the stuff can be tracked.
Speaker 2:The thing
Speaker 1:is And Elon's also laying people off. So, like, who knows?
Speaker 2:Yeah. And when you're at a scale like Tesla or any of these other companies, at any given point, there could there's a bunch of people that are leaving to go work on other things.
Speaker 1:Yeah. There's a
Speaker 2:One person
Speaker 1:Microsoft laid off a thousand people, and it's like 1% of the workforce. Yeah. And it's like, no.
Speaker 2:Well, the big debate over the weekend was between you and Ashley Vance.
Speaker 1:It was more of a collaboration than a debate.
Speaker 2:Of a collaboration, but but really trying to get to the bottom of an important story. Ashley said, why is The US not breeding tens of thousands of gorillas?
Speaker 1:I wanna know what sparked that post for him. Like like, why did he choose to post that? He's just got so gorilla pilled on a on a Sunday. Anyway, I said, I'm about to find out. I went to o three pro on Chachu Bee.
Speaker 1:Very funny. Tyler Cowen retweeted this, which I love. And there's some answers. Gorillas reproduce very slowly, so it would take a long time to scale up. Conservation programs keep the population small on purpose.
Speaker 1:I don't like that. US zoos follow coordinated plan called a special species survival plan, which aims to keep around 350 to 355 gorilla
Speaker 2:The conservation program is against wide scale mass That
Speaker 1:is crazy. This number is chosen to preserve genetic diversity over the long term. I feel like if you grew the population to 10,000, like, boom, you would have, I guess, overbreeding leads to surplus gorillas with nowhere to go. What about to our students? We have plenty of space.
Speaker 1:We'll take some gorillas. I think you could scale up the number of zoos as well. And then also, like, obviously put them to work. Like, you know, horses. No one's like, oh, yeah.
Speaker 1:Like, you know, too many horses. You can just ride them around. Everyone can have a horse. Everyone can get a gorilla. Yeah.
Speaker 1:They probably need to be domesticated
Speaker 2:little bit. Of gorillas too could be great for city Yeah. Kind of transportation. You know? It's stop and go traffic.
Speaker 2:Gorillas are really quick
Speaker 1:off the Gorilla domestication is the next biotech project. Let's tech check-in with Tyler Cosgrove over on the intern cam. Get an update. Oh, okay. He's moved over to big pharma.
Speaker 2:He's he's a he's
Speaker 1:a biotech company. Give us an update. What have you learned? What's what's new in your world?
Speaker 6:Still looking at, you know, various drugs. Yes. But I but I have found some interesting people
Speaker 2:I I would like to talk about.
Speaker 1:Okay. Hit us up.
Speaker 6:So the first one is, of course, Derek from moreplates,moredates.com.
Speaker 1:Oh, fantastic.
Speaker 6:Everyone, famous He seems like an expert. He makes YouTube videos about, you know, PEDs. So Yes. I think his experience would be useful for, for one, just the increased attractiveness.
Speaker 2:Oh, yeah. That'd big.
Speaker 6:You know, has a long history of like
Speaker 1:Looks maxing.
Speaker 6:People Looks maxing. Yes. And also for like athleticism, right?
Speaker 3:If I'm
Speaker 6:gonna be chasing balls Yeah. I need to be stronger
Speaker 1:This fast twitch muscle's going to be working overtime.
Speaker 6:So the next guy is Mike Henry. He's the CEO of BHP Group, which is the largest publicly traded mining company in the world.
Speaker 1:Why are we mining?
Speaker 6:We're mining because I need lead to make me dumber.
Speaker 1:Oh, okay.
Speaker 6:Yeah. Obviously, he should be an expert in lead.
Speaker 1:They're massive Mix that in.
Speaker 6:You know, mining mining company.
Speaker 1:So make it more of a cocktail than a one shot drug. Got it. Okay. And
Speaker 6:then, so so there I have increased, you know, I'm look snacks and I'm making me dumber. Yes. So the third one I need well, guess there's friendliness. Friendliness. But also I need I need to have more hair obviously.
Speaker 6:Oh, because I'm a dog. I'm gonna talk to I think it's Gunther Khan. He created Minoxidil.
Speaker 1:He did? Yeah. Okay. Interesting. Is he is he alive?
Speaker 1:No. Oh, okay. Well, we need an alive person.
Speaker 6:Actually he might I'm not sure.
Speaker 3:I'll look into that.
Speaker 1:We'll have to figure that out. We need experts we can bring on the show.
Speaker 6:Yeah. So those are the three I found so far. I'm gonna keep looking
Speaker 1:at We need friendliness. That's the key one that I'm most worried about. That's the one that's the most the the elusive the elusive drug for for for friendliness. And that's
Speaker 2:the one that we need. We see a
Speaker 1:lot of negativity in the timeline. We try and we try and encourage people with the what would your mother do ethos. Imagine just being
Speaker 2:a link
Speaker 1:so friendly.
Speaker 2:A link to them to say, hey.
Speaker 1:Take this drug.
Speaker 2:Injecting this once a week
Speaker 1:You'll be friendlier on timeline.
Speaker 2:You, you know, an order of magnitude more friendly on the
Speaker 1:No more aggressive quote tweets. No more clapbacks. Those will be a thing of the past.
Speaker 2:I didn't actually know that golden retrievers are
Speaker 1:From the golden
Speaker 2:retrievers showdown. Have pretty significant intelligence when comps to other dogs. They're the fourth most intelligent breed
Speaker 1:Pretty good.
Speaker 2:Behind border collies, poodles, and German shepherds.
Speaker 1:Narrative violation.
Speaker 2:Narrative violation.
Speaker 1:This is what you want. This is the guy who's on the left of the bell curve meme. Where everyone thinks the golden retriever is, but the golden retriever is secretly the guy on the right. Yeah. But that's the beauty is that they're the same guy, you know?
Speaker 2:Like He doesn't feel the
Speaker 1:need The golden retriever is not
Speaker 2:how intelligent.
Speaker 1:Because in the age of artificial intelligence, AI is gonna increasingly push everyone who's trying to be the guy on the right into the midwit territory. Yeah. And so you wanna just go full guy on the left or at least have people expect that you're the guy on the left.
Speaker 2:Well, we have a post from Bucko Capital.
Speaker 1:Wait. Really quickly. If you're breeding gorillas and you're gonna try and sell these gorillas across the world, you're gonna need Adio. Customer relationship magic. Adio is the AI native CRM that builds, scales and grows your company to the next level.
Speaker 1:Anyway.
Speaker 2:There's someone in the chat right now saying Adio has a great UI. I would invest in them.
Speaker 1:Let's go.
Speaker 2:Let's give it up for Adio.
Speaker 1:It's very good Adio.
Speaker 2:Get on there. You can check it out.
Speaker 1:Let's go over to Bucco Capital Bloke. He says, Apple has more of an impact on job creation in China than all of China has on America. Wow. This is obviously
Speaker 2:So there's a entire paragraph here. The size and influence of Apple aren't properly understood in part because they're so difficult to fathom. How can it be for instance that demand from China's 1,400,000,000 people indirectly supports across all industries between 1,000,002,600,000 jobs in America. Whereas by Tim Cook's estimate, Apple alone supports 5,000,000 jobs in China, 3,000,000 in manufacturing, and another 1,800,000 in app development. That upside down contrast boggles the mind of one super corporation has more of an impact on job creation in China than all of China has on America.
Speaker 1:Yeah. That is that is wild. This is obviously from Apple in China. Fantastic book. We have the author on the show.
Speaker 1:And Tim Cook's been or Tim Cook is quoted a bunch in the book. There's a ton of great scoops. I've been listening to the book a bunch, and it's and it's fantastic. There's a whole bunch of really interesting deep dives. Some stuff you might know, but it's woven together in a very interesting way.
Speaker 1:Highly recommend going and picking up the book or the audiobook, Apple in China. Ben Thompson's been singing its praises as well. He had the author on his show, did an interesting podcast with him, and really dug in a layer deeper that I highly recommend going and listening to. Fascinating. And it'll be interesting to see how this affects this could be this could Apple in China, I think, could be one of those books that becomes a reference point for DC policymakers in the same way that Chip War became kind of a a playbook for the Chips Act.
Speaker 1:And the hundred year marathon also became a kind of playbook for a renegotiation of the trade policy between The US and China. And so Yeah. These books don't come along often, but when they do, give them a read. Make sure it's heavily, heavily annotated and and highlighted. Anyway, if you're looking to invest in American companies, get on public.com investing for those who take it seriously.
Speaker 1:They got multi asset investing, industry leading yields, and they're trusted by millions. Go to public.com. What is this thing about Frontier Valley? I saw you
Speaker 2:posted this. Put this in there. I invited the founder James on the show. So Frontier Valley is a new special regulation district in SV that's larger than MoMA. Once approved, it will be America's epicenter for physical AI and deep tech innovation and will also be a template first a template for robotics first cities that can be replicated nationwide.
Speaker 1:What is going on here?
Speaker 2:Is this just on the East Bay?
Speaker 1:This is on East Bay. Top of an airport or something? Like, where where are they gonna build this? Is this landfill? Like, this this looks amazing.
Speaker 1:It just seems like so ambitious. I don't know how they're gonna pull this off. Anyways,
Speaker 2:I invited the founder on
Speaker 1:to learn more. I thought
Speaker 2:that it was at least it it reminded me about some of the stuff that California Forever is working on around shipbuilding. So anyways, we need more big ambitious projects like this and I hope they can figure out a way to pull this off.
Speaker 1:Yeah. Seems like it's getting steam.
Speaker 2:Post in here from Reid Hoffman. Reid Hoffman. Says, some AI industry leaders are predicting white collar bloodbaths. Even the most inspirational advice to new graduates lands like a band aid on a bullet wound. Some thoughts on new grads and finding a job in the AI wave.
Speaker 2:Gotta go into art history.
Speaker 1:It's the name of
Speaker 2:the game. Huge opportunity to go into art history. Reed says, what you really want is a dynamic career path, not a static one. Would it have made sense to Internet proof one's career in 1997 or YouTube proof it in 02/2008. What when new technology starts cresting, the best move is to surf that wave.
Speaker 2:This is where new grads can excel. College grads almost always enjoy an advantage over their senior leaders when it comes to adopting new technology. If you're a recent graduate, I urge you not to think in terms of AI proofing your career, instead AI optimize it. Sure. I think that's a great good framework.
Speaker 1:What do you think Internet proofing one's career in 1997 would have been? Like, I it's unfathomable because, like,
Speaker 2:the Internet rolled out so start a newspaper print newspaper.
Speaker 1:Okay. Or don't go work for one, I guess. Yeah. And instead, go work for
Speaker 2:No. But it is but but the the the immediate takeaway I have here is is you can be worried about job loss from AI and trying to pick the right job that's not gonna be replaced or you can proactively figure out how to leverage AI to be just vastly more efficient and productive and
Speaker 1:I'm just thinking about, like, like, Internet proofing feels like find a career that will not be disrupted by the Internet. Or YouTube proofing means, like, find an industry that will not be changed at all by the existence of YouTube. So it's not about, okay, like, what what was disrupted by YouTube? I mean, I guess, potentially, like, linear advertising or linear TV
Speaker 2:and stuff.
Speaker 1:But then there was
Speaker 2:still like tremendously. But if you went
Speaker 1:into reality TV in 02/2008, like, you did great, I imagine. But then also, there was, kind of the death of Hollywood.
Speaker 2:Well, thing about people that are entering startups or in the industry already, if you want to generate massive wealth and have massive impact and work at a company that becomes significant because of your participation, you have to work in an oftentimes have to work in an industry that's experiencing, you know, rapid rapid growth. Right? And so, you know, joining traditional entertainment world or getting into the reality t biz TV business when YouTube was taking off. Yep. Probably not gonna have that sort of ridiculous rapid growth.
Speaker 2:Yep. You know, maybe working for, you know, some some creator or or actually joining YouTube itself.
Speaker 1:Yeah. Yeah. I mean, certainly, he's saying like like, ride the wave, lean in. I'm I'm just wondering about, like, the idea of Internet proofing a career or YouTube proofing or AI proofing a career, it all feels the same. It's it's like become a furniture maker or something or become a Yep.
Speaker 1:Become a plumber. They're they're all kind of the same same sides. It's like if you're if you're a lawyer who's trying to inter Internet proof and says, like, we're gonna be the one law firm that doesn't use the Internet, like, that would be a disaster. And it's like it's like kind of unthinkable and same thing with like with with YouTube if you're working for like in a marketing agency and you're like, oh, we're gonna we're gonna be the best at at content that isn't relevant on YouTube. Yeah.
Speaker 1:It it it would be very, very difficult. And so, yeah, I mean, I I I agree with that sentiment. Interesting. But also just going to art history. Anyway, how'd you sleep last night?
Speaker 2:I put up
Speaker 1:some good numbers. Man, had rough night. Seven hours sixteen minutes. Not quite as good as Sunday where I got 92. Slept for almost nine hours.
Speaker 1:Putting up generational numbers. I got an 88. Did I beat you?
Speaker 2:I Did you? 80 Got an 86.
Speaker 1:Let's go. Let's go. Two weeks in a row.
Speaker 2:Two weeks in a row.
Speaker 1:Get the pod five.
Speaker 2:I'll give you an air horn.
Speaker 1:Five year warranty, thirty ninety
Speaker 2:minutes of Free
Speaker 1:returns, free shipping. Go to 8sleep.com. Use code TBPN. Of Father's Day, Kendall.
Speaker 2:Kenny Rose, the best gift you can give your father today is just the space to speak for twenty minutes uninterrupted on any one of the various geopolitical issues he's been monitoring this week. It's great. Fantastic gift.
Speaker 1:Just give us
Speaker 2:It's free to give, but it's priceless to receive.
Speaker 1:It is. It's fantastic. Well, we have Christian Garrett from one three seven Ventures in the studio. Welcome to the stream, Christian. How are you doing?
Speaker 2:I'm good. Good to
Speaker 5:see you guys. Glad to be here. We're at three sessions.
Speaker 1:Okay.
Speaker 5:Recently, I think the promise was 5 for a rocket engine.
Speaker 1:Oh, yeah. Yeah. So we gotta up these. We gotta
Speaker 2:up What are you doing tomorrow? What are doing Wednesday?
Speaker 1:To be clear, I I tried to book this, like, weeks ago. And, you know, so so
Speaker 5:so two. Justin was on.
Speaker 1:Yep. Yep. Yep.
Speaker 5:We're gonna be in debt pretty soon.
Speaker 1:We're opening it. We're opening it.
Speaker 2:Well, we got the space for it here. We're we're in the new studio.
Speaker 1:We definitely have the space.
Speaker 2:You can come by and hang in person.
Speaker 1:Send some Legos. We're we're getting to the physical stuff in the building slowly and surely. Have the big gong. Anyway, I wanna have you on talk about growth stage venture trends, LP dynamics with Bill Gurley's appearance on invest like the best. Thought it'd be interesting to get your reaction to that.
Speaker 1:Let's kick it off with this Logan Bartlett post, though. First, I'll read it, and, and I want your reaction. So, Logan says, have had a few conversations with bankers and friends in private equity over the last few weeks, and it's kind of remarkable how orphaned most of these 1 to $10,000,000,000 horizontal software companies are right now. There will be some strategic acquisitions, I. E, Informatica, but few and far between as those acquirers are getting their own house in order with AI.
Speaker 1:And some of these companies aren't just big enough just aren't big enough to move the needle, And private equity players are all worried about the plural site act plural site situation where AI just takes a leap and steamrolls something. It seems a lot of them are just on the sidelines from buying a horizontal player. We're going to see some frustrated public shareholders with very little recourse other than mix up management. Weird times. So break it down for us.
Speaker 1:What's your reaction? How real is this? What's what's correct about this? What's what's maybe off?
Speaker 5:Yeah. No. Logan makes a great point, and Logan's a great investor, and and he's he's absolutely right. I think there's definitely going to be consolidation. It's just like he hit at, right, what price.
Speaker 5:Mhmm. For context, right, like Asana trades at a four x NTM multiple right now. Mhmm. They're forecasted to grow 8% this year with 1% free cash flow margins. Wow.
Speaker 5:That was a business that during COVID, right, was trading at, like, multiples higher multiples than than than a ton of software businesses. Yeah. Workday now is is is trades at a premium to Asana. Wow. Bill.com was once the highest multiple in software and fintech.
Speaker 1:That's right.
Speaker 5:Now trades at, like, a two and
Speaker 7:a half x.
Speaker 5:Wow. Multiple. On top line, there's a ton of these companies that are real businesses, but they're not long term compounders with power to grow margins.
Speaker 1:Sure.
Speaker 5:And they're kinda stuck as point solutions. Yeah. We at one three seven heavily focus on durability when investing due to our focus on partnering with companies across the entire growth life cycle of a business. Right? So we wanna be excited about continually holding and investing to a company ten, twenty, thirty years from now, and I think Venture's kind of realizing this dynamic here.
Speaker 5:There's a Michael Maboussin paper on what's called the competitive advantage period that I encourage a lot people to go read, and it it's focused on how companies end up competing and being publicly traded on average for about ten years, ten to fifteen years, and then it ultimately ends up delisting or getting bought. And so you just kinda realize that, you know, there are businesses that you could be right on at one point in its life cycle, But then, you know, after ten years, fifteen, twenty years, margins compress, growth slows, and the business ends up kind of with a very different story and moniker. Yeah. And I think a lot of the ultimate winners within these categories, front end software development, fintech, they're actually the bundles. Right?
Speaker 5:And the stories we're talking about are point solutions or companies at risk where growth slowing down due to AI. I think the bundled winners are gonna end up having opportunity to consolidate, whether that's Figma across front end application development.
Speaker 1:Sure.
Speaker 5:You have Ramp and and Brax and Mercury, which in fintech. I think that's a real opportunity there, but the question's still gonna be on what price. Right? Yeah.
Speaker 1:Can you explain to me a little bit more about the the horizontal software companies versus vertical software companies? Toast is like the classic vertical example, I think. But these are kind of buzzwords, and I feel like when one gets hot, you're gonna see a lot of CEOs be like, oh, we're the we're in the hot category or vice versa. So how do you how do you see the the landscape of, like, horizontal versus vertical software? What are some examples?
Speaker 1:Can you explain that to me?
Speaker 2:Yeah. I mean, I
Speaker 5:think when looking at either, I think the you know, our investment framework is is around powers, and we look for sustainable competitive advantages. Mhmm. And so whether that's a vertical software business or horizontal software business, the key thing is are they building these defensible notes, whether it's switching costs, whether there's network effects? Is there some durability to this business getting better the bigger it gets?
Speaker 1:Mhmm.
Speaker 5:And then a big key function of that is multiproduct. It is much easier for a bundled offering to end up going after these horizontal point solutions or as much as if for vertical software business to run that playbook, right, of moving into financial products, launching more modules within that vertical to end up in that story and building more defensibility. If you end up kind of a single product company within the horizontal space, it it does become very difficult to have a long term kinda defensible story. So I think, you know, there's, like, inherent business model dynamics to pay attention to and the ability to go multiproduct, right, is key. A lot of the stories that we're talking about are companies that have multiple business lines with 9 to 10 figures of ARR.
Speaker 5:Sure. These companies that haven't worked have a very different story.
Speaker 1:Yeah. Is is an example there, like, what happened with, like, Slack and Teams where Slack was kind of this point solution? Yes. It eventually got plugged into the Salesforce ecosystem, but a lot of Outlook users and Microsoft Exchange users were just like, we'll just add on Teams. And so that's more of the the horizontal playbook.
Speaker 1:I because I'm I'm wondering about that Asana example specifically. Like, is there a horizontal player that's eating them? Because I when I think about what Asana does, yes, it's a point solution, but it feels like something that I can't immediately think of, oh, well, like, you're on the Microsoft stack, you'll just be using Microsoft's version of project management. But I'm sure they have one. So I don't know if there's more to say there about, like, what what areas are most are what what vertical areas are most fragile when it comes to a horizontal player coming in and kind of, like, eating their watch?
Speaker 2:Yeah. No. It's a it's
Speaker 5:a great question. I I think it's areas where the software becomes or the product becomes commoditized.
Speaker 1:Sure.
Speaker 5:Right? And so, you know, within fintech, you're seeing that with Bill Pay.
Speaker 2:Yep.
Speaker 5:And within Asada space, like, I think most of front end software development is in that category, and you see Figma moving into more and more watching more and more products that kinda go after that. And so, yeah, you you just kinda see, like, there's either a cap on how large the market actually is, so you sort of saturate the market, whether that's based on kind of sector or sizing of business or it's based on the actual kind of use case Yeah. Or you end up running digits and it ends up being a commoditized product. Right? It's very easy for the marginal competitor to launch a competitive offering and get their own feature parity over time.
Speaker 5:So, yeah, it's there's not a particular formula, but and it's always not easy, right, especially in a growing market. It's very easy to extrapolate out how, you know, a market will grow in perpetuity. I mean, Bill Ackman has this good line around growth annuities. Right? Not every business has a dynamic, right, where they can continue to own a large percentage or some meaningful percentage of a continually growing market, and therefore they have durable growth.
Speaker 5:A lot of these things end up saturating out, and their market size is actually much more constrained than investors anticipated, or they end up just getting commoditized. And so it gets really hard, and that leads to margin or pricing pressure or growth stalling.
Speaker 1:Yeah. Do you have a current thinking around, like, the the Parker Conrad, like, the compound startup idea of, like, let's build, like, everything as fast as possible and get our get our fingers in every single pie versus, like, the more methodical, like, let's go dominate one point solution and then add on another and then add on another. We're certainly seeing that at, like, Ramp, and we're seeing that at Figma with, you know, a really, really strong point solution and then using that as a platform for the rest of the of the horizontality to come into the business. I'm wondering I'm wondering if there's, like is it too early to do, like, a postmortem on, like, the right time to go broad? I've always thought about the consumer neo banks.
Speaker 1:Like, there still hasn't been a consumer neo bank that I'm aware of where I can go and get a checking account, a savings account, a public trading, like, trade stocks, also a home mortgage, also an auto loan. Like, those are five different point solution consumer fintech companies. And I was and everyone will always say, like, well, there's a lot of regulations. It's really hard to build all of them at once. And was like, but five of them are being built in YC, like, every single batch.
Speaker 1:Like, what if we just merged all those companies? Like, you would have a compound consumer startup, but it didn't happen. And I'm always wondering, like like, where is is that, like, a unique thing to Parker? Like, what is the full, like, postmortem on the idea of the compound startup?
Speaker 5:Yeah. I mean, I think the fundamentally, it's it's hard to pick a playbook for each. Right? We've seen, to your point, you know, Ripley that tries to move much faster and get to 50 plus percent feature feature parity Yeah. Before launching products within their bundle.
Speaker 5:And then you have startups that are much more methodical. Right? Different business line, Gusto's focused on really small businesses, but Gusto's been very, very methodical in rolling out products.
Speaker 1:And Mhmm.
Speaker 5:They have, you know, two core businesses that are massive, and they are slowly kind of rolling out more and more products, but they're very methodical. I think the biggest key is right to win. Right? And so in that case, as long as you have a core business that has a right to win, you give yourself the ability to think about how and what strategy you wanna run for going multiproduct. And, also, the other key is mentioned this feature parity point.
Speaker 5:For certain product offerings, I think feature parity matters less in regards to how much depth you have within the product. And then for certain offerings, it matters at top. Right? And so you have to sort of think about, do we wanna get something out quick as possible and cross sell, or do we wanna wait until we sort of have a a real offering? And that also depends on what customer you're servicing.
Speaker 5:An SMB Mhmm. Is very different than enterprise customer, and you're gonna take a lot more time to launch an enterprise grade product, you know, if you're going after this bundled opportunity. So it's not a particularly it's not a clear answer. It definitely does depend, but these are the kind of the fun things to think about when trying to invest in businesses over, you know, ten, twenty year time frames. You have to walk through kind of the strategy in these stories and make bets on how you think it's gonna play out, and and founders obviously will inform those bets on their thoughts, and we'll respond and iterate accordingly.
Speaker 1:Yeah. Is there is there enough capital out there to do a roll up of, like, Asana and bill.com? Like, some crazy take private of these two companies because, like, they are
Speaker 2:Let's go buy two slow growing companies who were category leaders that are getting eaten alive.
Speaker 1:It might be crazy enough to work,
Speaker 2:It might be crazy enough to work. If you're It's working for them. But if you can raise Yeah. For that roll up you you might be goated,
Speaker 1:and you should do it.
Speaker 5:I mean, this is this is private equity. Right? But the I mean, the real question is looking at it, why haven't they bought them? Right? Or why haven't these other companies, you know, decide to try to consolidate them or do a take private or Yeah.
Speaker 5:Merge more in the private markets? There really hasn't been as much consolidation in the categories I'm I'm particularly excited about around
Speaker 2:front end
Speaker 5:application development and fintech. Why is that? And I think this gets into a little bit some of the points on Bill Gurley's podcast recently.
Speaker 2:Sure.
Speaker 5:But there are a lot of these companies where if you're cash flow positive, you're not a forced seller. And if you're still hold on or hung on a expensive price, then it's not very clear from the buyer side why they should take all that dilution, especially if you believe that AI is going to lower the ceiling on, or increase the ceiling and sort of lower the floor a bit on on development and product development.
Speaker 1:K.
Speaker 5:So in some sense, maybe you should just build. Right? Like, the buy versus build dynamic is really interesting right now.
Speaker 2:Sure.
Speaker 5:Given sort of the the the the unlocks within AI on software development and where kind of pricing is for these companies. So it it isn't clear what's gonna happen with all these things. Do I think, you know, as interest rates drop, there's a lower cost of capital that maybe changes the calculus? But right now, a lot of these things are kinda stuck in a pause right now, and there hasn't been a lot of consolidation like I thought there was gonna be. But I think that will change over time mainly as a function of the cost of capital dropping.
Speaker 2:Yeah. Throughout this year, people have been calling 2025 the year of agents. I feel like that's come up quite a lot from a variety of of different hosts. There seems to be this or sorry, not host, but guests. There seems to be this collective belief that this is the year that we unlock power of agents.
Speaker 2:We've seen consumer agents like deep research. We see coding agents, things like that. My question from an investing standpoint is is it seems like every, you know, scale up SaaS company is aware of the potential of agents and it's just launching their own agents. And given the distribution advantage they have, how do you think about the the investability of net new agentic software when there's
Speaker 1:Yeah, yeah, yeah. My LinkedIn is
Speaker 2:like Intercom's a good example. They have hundreds of millions in ARR. Have a traditional SaaS offering and then they have Fin. And so
Speaker 1:Or even in, like, Bill Pay, it's like, is is bill Pay is is bill.com more threatened by a startup that's going to move much faster with code gen and generate something that's, like, just has different economics? Or or should they be more worried about, like, Microsoft spinning up a clone very quickly because Microsoft's able to move faster because of AI? Because we have this weird, like, arms race dynamic where, you know, everyone has access to AI even though the startups might be the only ones that are slapping it on the front door and the and the domain name. But in theory, like, AI should improve everyone.
Speaker 2:Yeah. And if you're a if you're a CEO who started your company seven years ago and
Speaker 1:But you're very aware.
Speaker 2:And you have a 100,000,000 of ARR, it's not like you just didn't check x.
Speaker 1:It's not like you have
Speaker 2:it's not like you have a drug research
Speaker 1:or anything like Yeah. I want your reaction.
Speaker 5:Yeah. I mean, it it's it's a great point. I think that you're you mentioned, like, Intercom is a good example, right, where you have an incumbent that, you know, is one of the winners in a category, and you've seen them execute incredibly well, right, in launching agents in the in the areas. I know Owen tweeted out. We're investors in Intercom for for a long time now, and Owen tweeted out a bit about the performance of the company and how AI has been pretty transformative to them.
Speaker 5:I think you've seen other companies, you know, lost their their their own agents out to mixed degrees. I think Intercom's a really successful example. Salesforce has been mixed. Yep. And and then you have, you know, some other legacy incumbents that have done pretty well actually in launching their agents like ServiceNow.
Speaker 5:Right? You've seen a ton of growth there. It's an interesting dynamic. I think there's a debate now as well where some of these companies are talking about gating access
Speaker 1:to
Speaker 5:their core data within as a system of record. Sure. And I think oh, that was great. Hello, Dorothy. So and I think that's also gonna be another a big one.
Speaker 5:Right? If if you believe in sort of extrapolate out the role that agents are gonna play, I think some of these companies are gonna look and try to maintain their kind of position system of record and not give access to kind of some of the quarter line data so that folks are gonna have to use their agent for certain workflows. And so this is also gonna be, I think, a continual debate on how people respond, where the value will accrue, and what does it look like to have agents in the workforce. Right? Is it gonna be agents within sort of the gated ecosystem Mhmm.
Speaker 5:Within Databricks, within ServiceNow, within kind of your existing SaaS providers, or are you gonna have this kind of abstraction layer above and one agent to kind of you know, that that that rules them all and and abstracts and coordinates across them all. Very interesting to see how it all plays out.
Speaker 1:Yeah. Let's go to Bill Gurley. Hot takes. Retired. We love retired venture capitalists speaking freely.
Speaker 5:I hope we'll be there one day.
Speaker 1:Yeah. Yeah. What what what was your what was your takeaway on his his state of the venture markets? He's very worried about capital wars, the zombie unicorns, the what's gonna happen with the decacorns. Well, what stuck out to you in his appearance on Yeah.
Speaker 5:I mean, I I thought Bill Gurley stated the union the market was really good. Yeah. He's a legend in our industry, and I'm one of many who's learned a lot from him sharing his knowledge. He's absolutely right about the dynamics around the overhang from 2021 and how there are a thousand or so companies that are still hanging on to marks Mhmm. From 2021 on people's books.
Speaker 5:And that's still working its way through the system. He's absolutely right in the loss of the kind of singles or doubles that used to matter to funds, and that's just a function of the growth in fund sizing. Right? So you were more incentivized to go for larger and larger outcomes and put more and more capital into these businesses, which is a, you know, real change from the beginnings of the industry as kind of a a niche fledging industry decades ago, and I think we're going through the same growth dynamic that private equity went through, you know, in the nineties and February as it became a a really mature and large asset class. Mhmm.
Speaker 5:I agree with him that we're repeating the same mistakes from 2021 a little bit, and all these AI companies may end up zombie AI companies with a ton of funding.
Speaker 2:The challenge now is, like, how do you avoid false positives? A a team is in an interesting category. They get to 15,000,000 of ARR in six months, and you're looking at the business, and you're like, this team is incredibly talented. The the company is growing at at at such an incredible clip, but then it's so easy for them to just kind of fall, you know, fall off a a cliff and and not actually break out into the into the sort of type of company that really ends up mattering.
Speaker 5:But Absolutely. Yeah. Absolutely. And and the one point that he he did hit on, which I definitely would wanna dive a bit more into, is something that we talk a lot about. But he talked about this kind of category within those, you know, thousand plus unicorns, and he, you know, he he hit on Stripe for a bit in Databricks.
Speaker 1:Mhmm.
Speaker 5:There's a category of company now that I I would say is probably like maybe 10 to 20 or so
Speaker 1:Mhmm.
Speaker 5:That we call the semi liquid category of technology company. It's really unique. I'd say our bet fifteen years ago on the trend of companies staying private longer post Facebook didn't even really appreciate or see the ultimate magnitude of this trend. If you look right now, these kind of top ten, twenty or so companies, we all know about them, SpaceX to Strive to Andoril. These companies would otherwise be large cap publicly traded companies.
Speaker 5:Some might even argue in the max seven if they were public. And had the cycle not changed, they probably majority of them would be public. Mhmm. Venture hasn't really seen this many companies stay private this long at this kind of growth and profitability and magnitude. And it's actually being met with a matching liquidity profile as well.
Speaker 5:And so for context, right, like, a bunch of these companies are doing billions and tens of billions of dollars in top line Yeah. And they're extremely profitable.
Speaker 1:Yep.
Speaker 5:They're all growing faster than what's in the public markets. I'd say within the bucket of companies I'm talking about, they're all growing 50 to a 100%. Palantir is the fastest growing publicly traded software business, and it's growing 30%. So the only way to access kind of growth is in the private markets within these high growth technology businesses.
Speaker 1:Yeah.
Speaker 5:And of that group, not only are they larger than many large cap businesses and growing faster, but they're also running a liquid market. And that liquid market is extending to the founders and employees as well as the investors in the LPs. So having these companies on your books is entirely different and almost like holding a public smart stock given the recency of the marks and liquidity around them. So it is almost entirely like a whole new sort of subs subset of company or whole new asset class within venture. We try to focus on cost training here and are lucky to be major shareholders in a lot of these businesses, but it is definitely something that I think no one could have sort of forecasted, is that usually companies, they stay private longer, but they went public when they were still burning cash, when they were still early in the growth curve.
Speaker 5:Now you're looking at companies that are not just growing fast, but they're extremely profitable. And given the liquidity around them, they kinda don't have a reason to go public. Yep. And that is a pretty interesting dynamic. And, you know, he talked about Stripe.
Speaker 5:I think there's a lot more of these companies, but it is still relatively small. It's, I'd say, 10 to 20.
Speaker 1:Yeah. I mean, I I feel like Stripe was the first private company that was really getting whispered around in, like, the centicorn conversation, and then we just blew past it with SpaceX and OpenAI, both in, like, the 300 plus billion range, heavy heavily liquid. What is what does that mean for the LP dynamic? Because if I'm paying two and twenty or something on holding something and maybe there's, like, like, an opportunity to go direct, is is there some pressure to distribute those shares earlier since they are semi liquid? Is there anything that's changing on the LP side with these, like, ultra late stage, ultra mega cap, centicorn private companies?
Speaker 5:I mean, I think back in the early point, if you're in these companies and you're in managers in these businesses, it's a different dynamic. I think if you're in the thousand unicorns, right, a lot of them are still holding on to marks and, and kind of it's unclear what's gonna ultimately happen there. That creates a different dynamic.
Speaker 1:Totally.
Speaker 5:We talk about the gap between TVPI and DPI.
Speaker 1:Yeah.
Speaker 5:If the gap are in these companies that are extremely profitable, they're marking every six to twelve months because they're running tenders regularly. Yep. You know, the the fundamentals you you have visibility into. These companies, the pressure around liquidity is very different. In fact, they kind of want that part of the book to still keep compounding because it's where the growth is.
Speaker 1:Yeah.
Speaker 5:In the public markets, the growth is not there compared to here. And so if you're you know, have the ability to be within a power law asset class and you're in the power law companies and they're performing this well and there's liquidity around them, we've actually seen less of a pressure, which has been kind of interesting. And when there is demand, it's very easy to facilitate it. Right? That's why I mentioned, like, you're holding the stand in your book.
Speaker 5:You can close the gap between TPPI and DPI relatively easily. Mhmm. And and so I think it's creating a different decision for the LPs within these funds, and we've seen increased demand to hold, increased demand to buy. And when there is demand to sell, you're able to facilitate that really easily as if you're holding a public stock. And once again, that's just very different than than than kind of what Growth Venture has has experienced, you know, over the previous decade plus.
Speaker 1:Yeah. You mentioned a number of companies that are maybe public and cash flow positive, so there isn't that pressure to sell. What about those unicorns where they are burning money still? They're hanging on to those high marks. We've seen a couple companies go out at haircuts to their all time high valuation, but it seems like historically when companies get out at rational valuations, they're somewhat set up for success, and they can go into kind of the next chapter of their lives and start growing.
Speaker 1:There's also this dynamic around m and a maybe being back on the menu. We saw the Wizz acquisition news. Scale, it just happened. There's been a few of these. Windsurf's been rumored.
Speaker 1:And so, like, the multibillion dollar acquisitions seem to be happening. Linacon's out, but the administration isn't fully, you know, embracing m and a. It's not happening constantly. But how do you think all of this unwinds?
Speaker 2:Yeah. I think m and a will pick up. Mhmm.
Speaker 5:I think some companies are, you know, at the tail end of growing back into those marks.
Speaker 1:Sure.
Speaker 5:And that just takes time. You know, some grew back within twelve to twenty four months. Some, it's taken, you know, thirty six to forty eight months. Yep. And then there's a large swath that are going to just have to take the pain and think about the business long term and remark.
Speaker 5:And there's some that's, like, super unclear. I don't know what percentage breakdown it is. I can probably confidently say the majority
Speaker 2:of that thousand are gonna be in that sort of
Speaker 5:latter bucket where it's very unclear what's gonna happen to them. Yep.
Speaker 2:And I don't think founders are gonna wanna operate zombie companies forever. Right?
Speaker 5:So at some point, they're gonna have to find a home, and the investors are gonna have to be willing to take the pain. Yep. But, look, there's a lot of companies that grew back into the marks from 2021 over varying degrees of time frame. You know? I mean, people forget there are companies in that top 10 to 20 bucket I mentioned that are growing fast and have very efficient profitable growth, and a bunch of them also had to go through 2021, right, and and and adjusting kind of their their views on pricing.
Speaker 5:If you can compound past it, great. If not, at some point, you have to make a decision whether it's remarketing the business or selling at something that maybe doesn't clear path.
Speaker 7:And Yeah.
Speaker 5:This is just a cycle. It's just taking a lot longer to work its way through.
Speaker 1:Do you think these bigger fund sizes and these more aggressive revenue ramps and these more aggressive valuations getting up into, I mean, time to unicorn for companies that are anywhere near product market fit seems like it's, like, three to six months now. Is that putting downward pressure on, like, the the, you know, low $100,000,000 tuck in acquisition that used to be just, like, such a win for everyone. It's like, yeah. They only raised 10,000,000. Everyone made money.
Speaker 1:The founders got, you know, liquid 10,000,000 plus or something. Everyone everyone's happy, and they can kinda move on with whatever the next chapter is, they built something cool. It feels like maybe I'm just not hearing those because all the numbers, if it doesn't if it doesn't if it's not in the billions, no one's even breaking through. It's not even going viral. Yeah.
Speaker 1:But it does feel like there's just there's just less of those happening, and I'm wondering if it's more driven by, you know, just, hey, it's a lot of overhead to do post merger integration even if we could get it approved. There's the FTC angle. There's also just the pricing angle. What do you think is driving, like, early stage m and a, you know, the status of early stage m and a?
Speaker 5:So many things. Mean, one, to your point, you did have administration that was a lot harder on M and A. And so I think Big Tech, who was the traditional buyer, let's say, last the last sites Yeah.
Speaker 1:I'm thinking about that VR company that Zuck bought that was like it was VR fitness. And it was like you know, not a huge deal, not in the billions. And they were like, you're dominant. You're monopolizing VR fitness. It's like, I don't know anyone who does VR
Speaker 5:Amazon and Roomba. Right? I mean, like, there's thing. It's like the the $100,000,000 to couple billion dollar talking from Big Tech definitely got put on pause.
Speaker 1:Yeah.
Speaker 5:One factor. Another is pricing expectations. I mean, the growth of the asset class, the growth of funds, people keep funding these companies a little longer to keep pushing for product market fit, and therefore, you start looking at valuations that become less attractive. Right? So Mhmm.
Speaker 5:That, you know, 1 to $300,000,000 tuck in was based on a company at series a that did their series a at $50,000,000 post, right, or something like that. Mean, that world is gone. Right? So now you've priced yourself out of an acquisition because you've raised too much money. It's a seed round now.
Speaker 1:$50,000,000 post? Like, it's a
Speaker 5:Exactly.
Speaker 2:It's watermelon seed, we're calling
Speaker 1:it. No. Watermelon. We you keep saying watermelon seed, but watermelon seeds are smaller than any other seeds. Like, the mango seed was
Speaker 2:a big seed round. Yes. Yes.
Speaker 1:The mango has the biggest
Speaker 2:We're beyond seeds now.
Speaker 1:Yes. Yes.
Speaker 5:It's just the whole fruit.
Speaker 1:Yeah. Yeah.
Speaker 7:The whole fruit.
Speaker 5:Yeah. I mean, I I think that's another that's another dynamic.
Speaker 1:It is.
Speaker 5:And so, yeah, I I just think a a lot of this is just structural.
Speaker 1:Sure.
Speaker 5:Do I think it comes back? I think on the margins, but
Speaker 1:It's it's on the founders. The founders have to say no to the higher valuations if they wanna have that as an option. And then once you have 400,000,000 in the pref stack, it's like, yeah, you're not gonna take a $150,000,000 Yeah. Acquihire offer Yeah. Acquisition offer or tuck in.
Speaker 1:Like, it's just not gonna happen. Jordy, wanted you to ask about capital wars a little bit if you had that question. But if you have something else, feel free to run to that.
Speaker 2:I mean, I I my issue with capital wars is they can have a negative effect on outcomes, but it sounds so awesome. I love capital involved.
Speaker 6:Right? Capital is the best. I just
Speaker 2:I had a I mean, I don't know how much there is to say or if you have any comments there, Christian. It just it just feels like, yeah, in every category now, you have at least two big fast growing players and then a couple multi stage investors on each side that are sort of saying, let's ride and just putting in hundreds of billions. And and, you know, I think Gurley had a front row seat to that with Uber and Lyft and how Lyft being funded just as though they were, you know, really, really competitive with Uber Yep. Even though they they there was pretty material differences And
Speaker 1:the Uber is a hard for years and years. Felt like Uber it was worth it to fight the capital war because Uber won so hard and now trades at what? A 100 x lift or something like that. So I don't know. Any any thoughts on capital wars and where we are right now?
Speaker 5:Yeah. It's obviously, it's an inefficiency in the market. Mhmm. It'd be much better if all the venture dollars that we're funding R and D and sales and marketing were consolidated into one company after one opportunity.
Speaker 1:Mhmm.
Speaker 5:Do I think also it's a sign of a vibrant ecosystem as well that there is that level of competition and there is that level of entrepreneurship where founders all wanna go after some opportunities and sort of have their version or strategy around it? Absolutely. So, you know, like, if the business of America is business, as Calvin Coolidge said, I think it's great that there are is the ability to have multiple businesses by the same opportunity. If you look in other ecosystems, when there's one dominant player, there's not 20 startups that get funding and go compete. And so Right.
Speaker 5:Although it's extremely inefficient and from as an investor perspective, you would like to see everyone just kinda back into the winner, assuming you're in the winner. At the same time, it's also a sign of a vibrant ecosystem where other other sort of tech markets don't have this dynamic. Right? And so, overall, I think the biggest question, which is gonna be very difficult, right, is when are founders willing to merge forces, right, and accept? And I think you've seen that happen here and there in cybersecurity and other categories.
Speaker 1:Pretty rare.
Speaker 5:So it's it's it's a tall ask.
Speaker 1:Yeah. The the ex PayPal merger legend there Absolutely. Worked out really well. So you you roll the tape and you say, what what would happen if some
Speaker 2:of the code gen companies merged and stuff?
Speaker 5:It had to happen. It 100% has to happen. And a lot the companies pre AI or pre AI, but the latest AI cycle from 2021 we've been talking about, they're also gonna have to go through this version. Yeah. But it's it's a tall ask, and I think it's just taking a lot longer to work its way through.
Speaker 2:I mean,
Speaker 1:the deal is already employing rippling employees. So imagine if you merge those companies, just one payroll system for all the employees.
Speaker 5:Be super efficient. That's true.
Speaker 2:What are you hoping
Speaker 1:on the cap table for both companies?
Speaker 2:What are you hoping to see out of robotics generally in the next twelve months feels like there's just a massive amount of excitement. Everybody's calling it the next. In some ways, like it it feels like it could turn into another even though a lot of robotics applications are kind of you could bundle them into the American dynamism category broadly. Feels like it could turn into its own thing. And even today, AI cleaning robot firm called Cardinal raises 800,000,000.
Speaker 2:Wow. I'd never heard of this company.
Speaker 1:I thought
Speaker 2:you were
Speaker 1:gonna say Gecko because they raise money and they'd
Speaker 2:be No. This company Cardinal just raised 800,000,000. Wow. I guess SoftBank is participating.
Speaker 1:That's cool.
Speaker 2:But but this is just one of many examples. I'm curious if you have any sort of expectations around the category. I'm sure you guys are in a lot of exciting companies already.
Speaker 5:Yeah. No. We we haven't done much in the robotics space. I think for the for the most part for us, there's kind of two things. Like, one, there's still we like to think about things between r and d risk and engineering execution risk.
Speaker 5:Mhmm. And I think this still feels slightly on the r and d risk side, especially some of the humanoid robotics companies. And we're just not I think there's better people to underwrite that. We're happy to once there's a bit more traction in the business Mhmm. As, you know, growth growth growth saves investors.
Speaker 5:In that, I think, you know, I'm not as close to a lot of these businesses, but I do think that, you know, for an LLM to build a world model, I think it's very difficult. I know there are people that are much closer that have really good arguments on either side, and I walk away convinced believing their argument based on who the last person I talked to. And so, yeah, I I I think overall, we're just kind of staying back and paying attention to how this plays out. I think there's a ton of excitements for a lot of reasons. I do worry that this may be, like, the first or second wave of autonomous vehicles where, like, now we're actually living and then beginning to actually play out.
Speaker 5:And we may be right on the trend. I'm a big immersive computing believer. I read every sci fi book as a kid. Everyone read Kevin Kelly, Ray Kurzweil books. Like, a 100% we believe in robotics and wanna see this, especially human robotics.
Speaker 5:I wonder if it's too early, and I wonder if the main use cases now are gonna look more like industrial use cases Yeah. Or robotics that have been around in manufacturing kind of scaling out versus the kind of human robotics like you're seeing. Yeah. But we'll see. But, obviously, it's a huge opportunity.
Speaker 5:Unclear if that's gonna play out this cycle or in a future cycle, but it's a cool role if it does. I I'm very much rooting for these companies.
Speaker 2:Are you seeing a, last question. Are you seeing a slowdown in activity yet? It's June 16.
Speaker 1:Yeah. Summer's coming. Sancho pays, popping, San Maritz, you're going Do
Speaker 2:see rounds getting done this summer just because some of these companies are moving so quickly?
Speaker 1:I think all of Silicon Valley grinds to a halt personally, but we'll see. What do you what do you think, Christian?
Speaker 2:I mean, what ask me in August what's going on.
Speaker 5:June, July, there's a lot going on still, and there's a fundraising. We're we're we're busy. Okay. And there'll be a lot of announcements coming out. But ask me in August.
Speaker 1:Okay. Yeah. Well, I'll be back on from wherever wherever you're vacationing. Thank you so much for joining. This is
Speaker 2:Two more to go. Two more to go. Let us know what you're doing tomorrow. We got a lot of space for an engine.
Speaker 1:Come on.
Speaker 2:Hang on. Can even put the we can put a plaque on it that's big enough, you know, if you zoom in that says, know, the one thirty seven. Engine.
Speaker 1:That'd be great.
Speaker 2:Anyways, great to see you.
Speaker 1:Thanks so much.
Speaker 2:Thanks for coming.
Speaker 1:You soon.
Speaker 2:Yeah. Cheers.
Speaker 1:Really quickly, let's tell you about Figma. You heard Christian mention it on that in that interview. Think bigger, build faster. Figma helps design and development teams build great products together. And we will invite our next guest into the studio, Aaron, from LightSpeed Venture Partners lsvp.com.
Speaker 1:Aaron, how are doing?
Speaker 2:He is. Round of applause.
Speaker 1:Welcome to the stream. First appearance. Hopefully, of many.
Speaker 2:First of many. I would hope.
Speaker 6:First of many.
Speaker 2:How are the chickens? You said you were you were you said you were looking after your chickens for a second before you It's awesome.
Speaker 7:Yeah. Yeah. Yeah. I had to go feed the chickens in the midday sun. They're good.
Speaker 7:They're good. We have a dozen new ones also.
Speaker 1:Is that a metaphor for seed stage bats?
Speaker 4:No. No. Not.
Speaker 2:Feed my chickens. No.
Speaker 1:It's not
Speaker 7:what I call my founder. No. No. The chicken coop on on the
Speaker 2:property where I live. So Amazing. Do you have a high-tech chicken coop or you keep it at low tech?
Speaker 7:Pretty much all chicken coops are falling apart by nature. Yes. You just kinda like keep propping them up. It's like any early stage investing. You just keep keep the companies alive until they they produce eggs.
Speaker 2:Yeah. Growing up, my my dad was was very into building hardware software solutions for our chicken coop. So he would rig these sprinklers to like fill up a bucket at the right time that would pull up the gate using gravity and then it would dump out. Mhmm. So he should have productized it.
Speaker 2:There's now a bunch of chick chicken tech companies. I don't know how they're doing.
Speaker 1:Reaction to foxes and hen houses, avoided all costs?
Speaker 7:Yes. Scarecrows and fake fake owls.
Speaker 1:They're oh, fake owls. Really?
Speaker 7:Yeah. Equals. Yeah. I'll send you a picture.
Speaker 1:This is good. Fox defenses. Defense tech for for chicken coops. I love it.
Speaker 2:Yeah. For who knows. Anyway. Awesome awesome to have you on it. Why don't why don't before we just start all ranting together
Speaker 1:Yeah. Talking about fossils.
Speaker 2:Give a give us give a give a quick kind of overview of your background, what you're up to for the Yeah.
Speaker 7:Well, before I sold out, I was a founder myself, so I sat on the other side. I built built a company called Final about a decade ago that became we sold it to Goldman Sachs and it became what is now the Apple Card. So I've done a lot of kinda deep fintech experience. How I met Jordy was I was angel investing and advising long ago in early stage fintech. And then now I'm an early stage partner on the fintech team at Lightspeed.
Speaker 7:And when I say sell, this is kinda what I wanna do with my life's work is help early founders and kinda be in the weeds go zero one.
Speaker 2:Break up the chapters of Fintech history in your mind. When you started final, I'm sure you just got a lot of did you get a lot of no's or were you built different and people were like, yeah. I don't know about this Fintech thing but this this makes sense.
Speaker 4:I got a lot I got
Speaker 7:a 100 nos, I think, when we were raising our series a. Just it was kind of a slog. We were probably, you know, fintech two point o where one point o was like bank simple and like a few other of those people. Wave two point o, Chime would be at the beginning of that. Mhmm.
Speaker 7:And then, like, Robinhood would be in the we were kind of the same cohort at Robinhood. My company final, ultimately, we kinda were going after the wrong target customer segment where you just needed massive distribution, which it turns out that, you know, Apple does have, especially for the right customer base. So it made sense to partner with Goldman and kind of sit inside there, but, you know, now we're sitting on almost wave four. Right? Like, we're doing a lot of stablecoin stuff at Lightspeed, and I spent a lot of time kind of we hosted a stablecoin conference back in February.
Speaker 7:You look at all this stuff, and the stuff that you wanna do in fintech now are just so much easier than it was back then. We were like a full actual credit card including line of credit and took two and a half years to launch that company just because there hadn't been anyone since wave one when it was company called Revolution Money had had launched through Steve Case and
Speaker 1:Oh, yeah.
Speaker 7:Which why they call it Revolution Capital. But that was wave one and we had to go find people from that company to even figure out as a startup how you bring a credit card to market. Now you can do it in nine months if if you
Speaker 1:I have a question about this. I was talking to Christian about this earlier. This idea of, like, the compound startup, we've seen it in enterprise software. Why can't someone build all of the consumer fintech products in one kind of neobank, one stop shop? On day one, I sign up and I get a credit card, a checking account, a savings account, the ability to buy stocks and Bitcoin, a mortgage, and a car loan all in one.
Speaker 1:Right now, that feels like six different startups, six different YC companies potentially. But if if each one of those can now be built in nine months, why can't they all be built in parallel in nine months?
Speaker 7:We may see with kind of, like, all the AI stuff, but, honestly, it's not a technology problem. Okay. Financial services products, the same building blocks that existed, I hate to say since the Medicis, but for a long time now. So we have product market fit. Consumers want access to credit.
Speaker 7:They want savings accounts. They want mortgages. They want car loans. Mhmm. What we don't have is product marketing fit.
Speaker 7:And so it's the same reason we've seen even Robinhood with essentially infinite capital to go and acquire. It's taking them a long time to get the right product construct and aggregate all of those different products together. And them them, this is sort of the wealth the wealth front MO when they tried to play this game, but it's just really hard to get that second, third, fourth, fifth attach rate to be high enough to make it work that you can ever make the economics work. Unless you're playing the bundling game. Right?
Speaker 7:If you're built, which is what Robinhood Gold is. If you're playing Amazon Prime, is my best customers, I wanna just own their entire financial life Mhmm. That's a path you can you can take. But the the answer is just product marketing fit. It's not product market fit.
Speaker 7:Financial services fundamentally have it. We need access to it, but you just, you know, getting the product right. Why would I, if I have trading at Robinhood, go get a shittier checking account from them? Not that they have that. Just from across the board.
Speaker 7:You just need to get the product construct right. And then you're also not gonna go out and spend on CAC again. You're gonna try to cross sell.
Speaker 1:So I I I'm just wondering about, like, the product marketing fit, this idea that, if you went to customers with this idea of this is the drop in replacement for your Chase account, which you have your mortgage with and your car loan and your credit card with. And Chase owns a bunch of different stuff. But it's all one solution, one app for everything. Maybe they're all kind of mediocre to start with, but then they all get better. It's interesting that no one's been able to break through with that.
Speaker 2:I think the challenge is you acquire a customer in their 20s, and they just need a basic checking account, card,
Speaker 1:and maybe auto loan. Class and everything. Right? Because you're like, oh, I I I want the best possible price for my mortgage. And so unless you can win consistently in every single thing, you're gonna get fragmented.
Speaker 2:So I think it'd be helpful to talk through couple recent IPOs. Chime as well as Circle, they they Chime, you know, obviously represents what you called, you know, FinTech two point o started around the time that you guys started final. Finally got out, you know, well below their their twenty twenty one marks, but at least they're out. And we now have proof points too that that some of these businesses can do well in the public markets. At least Dave, I think if you bought Dave at the bottom like a year and a half ago or something You'd
Speaker 3:real lucky.
Speaker 2:Yeah. You know, crazy multiples. So it's good to see that, you know, these sort of neo banks can exist in the public markets. But why don't we start with Chime? What was your reaction?
Speaker 2:It seems like a pretty solid outcome for Yeah. Yeah. From from my point of
Speaker 7:It's great for everyone, but I think Sequoia or DST did the last round. Mhmm. And even then, I think they're back pretty close to in the money. Mhmm. Ultimately, like, liquidity is the future.
Speaker 7:The Chime IPO is fantastic for the rest of fintech. Mhmm. We will see compounding amounts of capital flow down. One to the early stage funds, but even every single one of their employees over the last I think it was a 2012 company, 2011, over the last, like, thirteen years become angels in a meaningful way and just see that there's room for product innovation. They also are potential one of these aggregators.
Speaker 7:Right? Chime now has a even bigger balance sheet, and they can go in after and and and aggregate people, and maybe it's not the same customer for the multiple products, but they can get deeper into credit. They, in theory, could buy they could have bought a Dave or a MoneyLion and kind of get that sort of product under the hood. You know, when you look at, like, a Chase, a $750,000,000,000 company or banking, they have to do a lot of things to get to that market cap. So you have to do all of these disparate services that don't always necessarily have the same fundamental core systems underneath.
Speaker 7:So Chime now is an IPO, shows one that fintech actually can have a decacorn, you know, as a public company, and in neobanking. So we'll see a few others go, and we can also see that we can actually and I I trust Chris and Ryan to go out and do this because they know what they're doing, but they can go and become an aggregator and kinda do more. I think it'll also just drive a few more fintechs to go public because it's just it forces you to be a mature business, get your economies of scale right. And in some sense, the Chime IPO that it's below the the the top tick mark is probably just more a side effect of interest rates being higher and capital finding other sources as opposed to, like, this thing being worth whatever it's worth today. Right?
Speaker 7:It's still up, like, 40% from the IPO, which seems pretty successful and, you know, it's a pretty good win for the industry.
Speaker 2:Yeah. Yeah. So before we dive into Circle, is there, how how are companies like Chime messaging around AI? It feels the obvious application is just better customer service and maybe you can use agents to serve more customers and and increase margins. Is that and I'm sure they're applying it around, you know, fraud and and and other use cases.
Speaker 2:But in your mind, what are what are the exciting ways that that a that a scaled fintech like Chime can actually apply this stuff?
Speaker 7:Yeah. I mean, it's where there's ever an an industry speak and coming from credit cards, there are a lot of industry speak. It's where we can apply AI to arms and legs. Right? Like, people are this massive cost.
Speaker 7:So customer service is one thing, but really it's actually the back offices of a lot of these businesses. We've invested in a company that does dispute management and then, like, as a professional service plus AI. And so you are able to give what is effectively an AI powered BPO and do this for other companies. But for someone like Chime, you know, pre IPO, they announced that they, I think they call it Chimecore. Like, they built their own processing stack, and they they kinda are getting off of Galileo, is owned by SoFi slowly.
Speaker 7:It AI enables kind of all of these macro tailwinds that just really give them better economies of scale as a bank, to operate. Tier one is customer service. Tier two is then really, like you know, a bank is kind of like, an iceberg. As a consumer, you only see above the water, but there's so much below the water to make these things really work. And that's where Chime is like able to actually and all of these kind of scaled neo banks and fintech companies are able to use AI to provide better services for their customers.
Speaker 7:You can almost think of it as like applied AI. Right? They're not research companies Mhmm. But they really can find places just to replace where they've thrown bodies at problems in the past.
Speaker 2:That makes sense. How are late stage private market investors as well as public market investors looking at fintech businesses that get a large amount of their revenue from interest yield? It felt like when interest rates popped in late twenty twenty two and and, you know, have have sort of stabilized, it felt like people were kind of looking around and being like, a bunch of these businesses are generating a lot of revenue now, but everyone was discounting it so massively. Now if you look at the macro, it seems like we we potentially have entered into a new normal with just like sort of moderate rates. Is that is that the way people are looking at it or or is it still like a massive discount being applied?
Speaker 7:In the private markets, there's still a pretty big discount. Some people will give you credit, and it the reason you give someone credit is just because it lets you compound the business. Right? Like, you're essentially immediately profitable post ZERP ending because you just had all these deposits. It's gonna flow to you, and you're gonna be able to make all of this interest revenue.
Speaker 7:And the best founders are now just compounding that into other business lines and using that to to just bring kind of more of what you're talking about of all of these different services. We see it a little bit more in small business than we see in consumer just because if you're pitching a consumer on a high interest rate, they're typically a pretty, like, hot deposit. They're gonna move around, and it's just not the best person to build against. Whereas a business, you're actually giving services, so you're able to charge them across the board. But yeah.
Speaker 7:So there's a pretty big discount on it, but, you know, it's not it's not back to ZERP discount, which is, I think, what everyone was expecting initially. It's more akin to two to three point rate, wherever the two year t is. You know, it feels about right just from where we're expecting the market to come back to.
Speaker 2:That makes sense. What was your reaction to Circle's IPO? We had Jeremy, the CEO on the show, which was great. They have a big, you know, bold vision. I think they've executed very, very well.
Speaker 2:And at the same time, it was interesting to see the market reaction to stables versus how people initially reacted to the s one which many people looked at it and said, this company isn't even actually, shouldn't actually go out. Like, they should just get acquired by by Coinbase. And clearly, there was an exceptional amount of demand, but I'm curious how you how you saw you kind of looked at the the business pre and then post IPO.
Speaker 7:Yeah. I mean, pre IPO is the same kind of look. Like, all the revenue goes to Coinbase, and I know a bunch of Circle people. I know Jeremy. He actually spoke at our conference, and and have been able to get closer to them.
Speaker 7:But it it it's one of those that, you know, if you think about the macro trend of stable coins and this isn't circle specific, but, you know, the biggest export in The US economy is the US dollar. Post brand would
Speaker 2:Let's give it up for the US
Speaker 1:dollar. Yeah.
Speaker 7:Post Britain was essentially like we've tried to dollarize the world and make everything trade in it. Circle IPO is just showing that there's more demand for that. Right? There's one retail demand for kind of like a normal crypto company in the public market, but two is if you think about where the world might go, where the dollar might just be it's already hegemonic, but it becomes the only meaningful currency. Circle or Tether is gonna be one of those two people who plays that role.
Speaker 7:It is possible we see a new upstart. There's you know, we're we're playing around with a bunch of ideals around stablecoins and how they may exist. Maybe we'll get a stablecoin per country, not necessarily CBDC, but maybe we also dollarize every country. We're seeing a lot of ideas come through right now. From the Circle IPO, it just showed there's just a ton of demand.
Speaker 7:I know Jeremy and team are
Speaker 2:incredibly What are Yeah. What are every single person that is at a legacy financial institution or a big bank is looking at the Circle IPO and, you know, probably excited and a little bit like, we should do this ourselves, starting to think about, you know, should we have our own stable coin, etcetera. I can think of some reasons why they have more of a moat than the average person just kind of analyzing the business for the first time I think. Right? They have liquidity, deep partnerships, they have a regulatory, you know you know, sort of arm that's now getting involved in countries all over the world.
Speaker 2:They have developer tooling that's really powerful. So they've they've they've done quite a lot to build out their sort of long term edge. But I'm curious why you think Circle could con could potentially continue to to sort of durably accrue value even though other people will will naturally start to compete with them.
Speaker 7:Yeah. I mean, look, there was a story about Walmart and Amazon trying to launch a stable coin. You know, the joke I've made to friends is that essentially just rhymes with Kohl's cash. Like, wants a a merchant based stable coin. Maybe from the banks, they'll build a consortium, but we've seen historically those kind of fail.
Speaker 7:The reason circle But
Speaker 2:did Zelle did Zelle fail or is
Speaker 7:Well, Zelle is EWS which sells a bunch of services, but ultimately, like, consumer NPS on Zelle cannot be high because it's so fraudy and so just painful to use as a kind of integration point. No. I I'm talking, man, it used to be called SoftPay. At one point, it was called Isis. It was this bank consortium of pay by like, pay by bank.
Speaker 7:I kid you not. Crazy
Speaker 2:crazy name for a bank consortium.
Speaker 7:They had they had to rebrand when I just chose the same name as them. Brutal. Off pay. And then JPM bought them to take them out of the market so that nobody could really see how bad it was. So, like, a bank consortium with Stablecoin makes sense.
Speaker 7:There's a bunch of people. Greg Kidd, is one of the early angels into Twitter, Square, Ripple, Coinbase, is working on something called USDB. We're gonna see a lot of these things play out. Circle just has this like, in financial services, scale is what makes you win a lot of the times. Or if you or it gives you a real network effect.
Speaker 7:Circle is gonna spend a lot of this money trying to build sort of a a network like Visa, Mastercard is kind of the underlying bet where they can get merchants on one side and and get consumers on the other. Whether or not it's for supplier payments and b to b stuff or b to c payments is a little unclear, and I'm sure, you know, if I were them, I'd be throwing everything against the wall to make it stick. They had a lot of announcements pre IPO in, pretty much all of April and early May, which seemed like stuff that they really been working on for a while and just weren't sure kind of due to the Trump tariffs if they'd able to go out if the market would reopen. They got that stuff out there. It's a very strong narrative of what they can do into the future.
Speaker 7:It's just now they have to go and execute on it. And that's one of the things, you know, they're fighting an uphill battle of network effect in traditional financial services.
Speaker 2:How are you thinking about stablecoins as a as an investment category? I'm sure this is how you're spending probably 50% of your time.
Speaker 1:Is now the time to get in? It seems like this is a public company.
Speaker 2:No. I think in many ways, the IPO no. I'm not saying investing in the next stable coin issuer. I'm talking about the actual app consumer applications, b two b applications.
Speaker 1:The infrastructure's here.
Speaker 6:You know,
Speaker 2:me, it's it's it's can imagine a massive wave of companies being funded that try to ride the stable coin wave but then ultimately end up getting just, you know, sure locked by by circles and stripes and and things like that. But but how do you think about it?
Speaker 7:Yeah. I mean, so I'm an early stage investor for the most part. Like, bet on people and then I like I I'm looking for companies and founders I fall in love with and then wanna figure out how to deploy capital into them. Stablecoins is this current trend. Every company is now in some sense, a stablecoin company, if it makes sense for their business, just like every company is an AI company.
Speaker 7:We we figure out a few archetypes of founders, and I was joking with one of my founder friends of, like, we'll probably coin it as money three point o founders where they they're very serious about how you handle a business that actually touches money. But on the other side of it, they're taking all the efficiencies that come with crypto. And when you combine the two, you end up in a in a world which is stable coins. So we we've been able to back about two companies right now in the last few months doing that. We've seen a lot of the companies kinda in the middle of the of the sandwich, which is like, you have issuance, you have consumer distribution.
Speaker 7:In the middle, you have a lot of orchestration, you have a lot of, like, actual bill pay and stuff like that. We've sat more on the issue inside and core infrastructure side. We've looked a lot at the kind of, like, later stage distribution side and just I've realized that in the middle, they're gonna get squeezed. The the the issuers like Circle are gonna have to move up market and verticalize, or the distribution place where they control all the value from the consumer and can build a better product. They're gonna have to move down market and kind of eat down the stack or or dual source or triple source their vendors so that they can, at the end of the day, squeeze them on margin, which is, honestly, from a distribution perspective, the traditional fintech play.
Speaker 7:It's what Cash App, it's what Chime has done. You put as many vendors behind you as possible that do the same thing. And then when you go to rebid the contract, you just squeeze them. So we've made a few bets in the space. And, really, when we're seeing demand on the distribution side, we're seeing it, honestly, outside The US.
Speaker 7:I I personally haven't figured out a use case where stablecoins reduce the friction of that you see in The US banking system. But if I'm not in America and I want access to the US dollar, it's the fastest way for me to get access to the US dollar in something that looks like a US bank account. It also helps for people who are, you know, operations
Speaker 2:What about buying a car on the weekend?
Speaker 7:You can still do that. There are services that do that. Fedwire is actually, I believe, seven day settlement now. So with the right bank, you can even do that. Also like Stablecoins mogs.
Speaker 7:Circle. What?
Speaker 2:Fedwire mogs. Bearish for Stablecoins.
Speaker 1:Stablecoins like
Speaker 3:Yeah. I mean No.
Speaker 2:I mean, there's a bunch of other There's so many other use cases. I mean, streaming, you know, I I mean, there there's
Speaker 7:It it's the thing is, like, if you think how Visa and Mastercard work, they're the biggest factoring networks in the world. They're they're taking risk. They're adjudicating risk for a bank when a consumer swipes. And so what is the risk that Visa, Mastercard, and Amex Discover take? It's single digit, maybe doesn't like, 12 basis points.
Speaker 7:The rest of that interchange flows to the bank. It flows to the issuer who's actually taking the real risk. And so if stablecoins and Visa and Mastercard are both taking this very seriously, if stablecoins start kind of eating their lunch, we're gonna enter a world where they're just gonna cut rates, and we're gonna get a much more I hate to say efficient. We're gonna get a less lucrative card issuing and kind of network based world there for the big banks where Chase can no longer offer you Capital One, can't offer you high high rewards because there's no margin in it for them.
Speaker 2:Interesting. So will we see protests in the streets from point points maxers, you know, just taking saying like, we don't want We do not want efficiency in the financial system.
Speaker 1:Yeah. The points We
Speaker 2:wanna keep rewards high. Really upset.
Speaker 7:Well, they'll they'll just hire the lobbyists finally. Really, crypto got around to hiring lobbyists. The points points guys will
Speaker 1:Points guys will What what about unexpected beneficiary? Oh, sorry.
Speaker 7:I'll I'll No.
Speaker 4:No. No.
Speaker 7:I was gonna say the banks also want higher interchange. So they're actually fighting this well. That's why they're trying to put out stablecoins. It's gonna get messy. Like, we're gonna overinvest in the space like we do in everything in venture.
Speaker 7:And then at the end of the day, a few winners will emerge. Circle's been around for so long that, like, it clearly makes sense. They got big. They aggregated a lot of value and how we're gonna see a lot of people come for their for that opportunity as well. What
Speaker 1:about unexpected beneficiaries of stablecoins? I've heard that potentially some payroll companies that maybe hold on to tax withholding, they might be able to earn higher yield because they're able to actually hold the treasuries themselves. Do like, does do stablecoins unlock any sort of float dynamics and shift it from a bank making making an interest rate return on float that they're holding versus the company can now do it because of stablecoins? Are there any kind of unlocks like that that are might be happening?
Speaker 7:It let if I live in I hate to say Venezuela, Colombia. But if I look like so so for what your use case, not for a sophisticated business, you should be having a serious conversation with your bank to figure out how you earn that float. Sure. Small scale, it may get you better economics, but not gonna move the needle economics. Right?
Speaker 7:There's only so much juice to squeeze from that orange. Really, yeah, the side effect is, like, I no longer have to trust my my government as a as international human. Right?
Speaker 2:Like, I
Speaker 7:I don't like, I can move my savings into the US dollar, which right now is, in theory, the least volatile currency. But from, like Mhmm. US companies, yeah, there's a little bit of friction reduction. It lubricates the system a little. But at any meaningful scale, you're gonna take most of that yield anyway because you're gonna go back to your your bank partner where you for if I'm a payroll company, I have a direct relationship with some banks somewhere, and I'm gonna take some of that yield.
Speaker 7:The other thing I should say is stablecoins are in theory two things. One is that they actually underlying treasury, which actually holds a risk asset. It's a US usually, it's a it's a t bill of some sort. Yeah. But the other side of it is a payment vehicle, and payment vehicles traditionally are not risk assets.
Speaker 7:You send them, and the money is good. Right? Like Mhmm. And and so it's one of those, like, the benefit that we see is really on the payment side. On the yielding side, maybe we'll get securitized CD bill, like, t bills and t bonds, and, like, we'll get securitized CDs and, like, somebody will actually have direct access to treasury to to get these things ad hoc.
Speaker 7:But it's a it's a bid out because there's just so much demand on the payment side of this industry, and I it's really hard for all of us to grasp truly how big payments are. Like, it that's why stable coins are taking off. It's giving people access to The US banking system in such large volumes that they otherwise wouldn't been able to.
Speaker 1:What about geopolitical risk? I imagine that if I'm a dictator in another country and I'm watching all my citizens, like, go off of buy currency that I control, I would wanna ban that. Is that a major risk? Are we beyond those discussions at this point?
Speaker 7:You can ban the on ramps, off ramps. You cannot ban your ability for your citizens to get into a stable coin directly Mhmm. But not indirectly through crypto. Right? Like, I can go buy Bitcoin and then swap that into USDC.
Speaker 7:Mhmm. Yeah. That's kind of the running joke between a few of my friends on the back channel of, like, who's gonna who's gonna be the first startup to just aggressively essentially become an arm of the CIA and new USAID in dollarized countries, to promote US hegemony. It's like half a joke. It also is just gonna naturally happen.
Speaker 7:If I don't have to worry about the volatility of my currency, and I'm a and I'm a human who's not living paycheck to paycheck, so I actually have savings, why would I want my local currency if I'm not gonna actually spend that money and I actually wanna be able to save for the long term? And there is no ability for you to capture that money because it's my private keys. It's so so there there's a ton of value there. There is some geopolitical risk, but at the end of the day, it's one of those that I think, the world's gonna have to move through it, not past it.
Speaker 1:Yeah. You so you're not worried about, like, a great firewall for all the on ramps and off ramps. And then, I mean, if you make it illegal that someone's discovered with stablecoins, you're holding USDC, and now you go to jail. Like, that is a serious, serious, headwind towards stable coin adoption in a, you know, in a dictatorship, I imagine.
Speaker 7:Yeah. It's a quest yeah. For maybe unfriendly countries to The US, but like, you're semi friendly, do you wanna actually
Speaker 1:do That is crazy. Right?
Speaker 2:Like Especially when the Trump family is so heavily involved with digital assets, you know, and such big believers.
Speaker 7:Mean The joke I made last week was like, why why even issue stable coins against treasury bills? We might as well issue it against the US military. So like, you're a friend of The US, you're not gonna really cut us off.
Speaker 2:Yeah. Issued against well, that maybe why is Coinbase, you know, sponsor the the army parade.
Speaker 1:Maybe. Yeah.
Speaker 2:Maybe there. Maybe Maybe maybe they're cooking. Maybe they're cooking.
Speaker 1:Milk coin. It's coming soon.
Speaker 2:Milk coin. Any any other any any kind of events in the in the sort of broader fintech stable coin world that that are coming down the pipeline Catalysts. Potential IPOs, catalysts that you're kinda looking out for? Or is it summer break and we can just all check back in the fall?
Speaker 1:Isn't there a stable coin bill going through right now?
Speaker 7:Yeah. The Genius Act, they're gonna negotiate it. You know, it I I try not to play politics at all. It's just not where I have the expertise. I think I think they'll actually I don't think we'll have a summer break.
Speaker 7:I think the IPO window's open, and this is not knowing anything.
Speaker 2:That's great
Speaker 1:to hear.
Speaker 7:Everyone thought they could get public in April, and then that blew up. And then May, kind of like we reopened the window.
Speaker 6:Yep.
Speaker 7:If I was trying to go public, I'm gonna try to sneak it through until something geopolitical closes the window again, which is like kind of the mantra right now. So I think the the bankers on Wall Street are not gonna get the summer off. The Hamptons will be empty.
Speaker 1:Time to grind. That's why
Speaker 2:the Hamptons are empty. So funny. You know you know, there there's been like these articles like Hamptons rentals are down 30% this year.
Speaker 1:IPO windows open.
Speaker 2:IPO windows Time
Speaker 1:to stay on Wall Street. You can't leave Manhattan while the windows open. Would be insane. Thank you so much for stopping by. This is
Speaker 2:This was great, Aaron. I really enjoyed it. We'd love to have you back on again soon.
Speaker 7:Thanks. Thanks, guys.
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Speaker 1:It's a vacation home, but better Better. Folks. Our next guest is from Standard and Poor's S and P. Joseph Kass coming in the studio. Very excited to talk to him.
Speaker 1:He has talked to some of the most impactful financiers, one one notch away from us. We talk about a lot of technology. We talk to some business folks. He has experience talking to Ken Griffin, Howard Marks, Ray Dalio, has a bunch of interesting stories to share with us. I'm excited to pick his brain.
Speaker 1:Good morning. To the
Speaker 7:show. Inbound.
Speaker 1:Joseph, how you doing?
Speaker 2:Hey. What's going on?
Speaker 3:John Jordy. Yeah. Great. Great to meet you guys. Thanks for having me.
Speaker 3:All good. How's things on your end of LA?
Speaker 1:It's fantastic. The It's late for you. The the crazy protest.
Speaker 2:Yeah. Yeah. You're The UK.
Speaker 3:But it's still light, so
Speaker 1:it's still good. Well, we appreciate you staying up late to hop on the show. Why don't you kick us off with a little bit of introduction on yourself? I'd love to just kind of understand how S and P is structured, how it's working these days, like the core business lines, because it's such a such an institution.
Speaker 3:Yeah. Yeah. Sure. It's a really it's a huge business. So I work in the ratings division.
Speaker 3:Yeah. So you have a number of different divisions including the indices, so kinda like the S and P five hundred. You have market intelligence, which provides kind of the data and analytics platform. You have mobility, which owns a a bunch of businesses, one of whom is Carfax. Oh, interesting.
Speaker 3:There's a there's a number of different divisions in the company, and I'm I'm trying to remember if I've got all of them there. But it it comes together to make S and P global. So I work in the ratings division, which, you know, assigns the ratings, you know, the kind of triple a's or the double b's or the c's.
Speaker 1:Yeah. We gotta hold your feet to the fire because S and P downgraded America. And I'm hearing an accent, so this seems like it's maybe some political issue going on.
Speaker 3:Well, I can correct you there. It was actually Moody's.
Speaker 1:Yeah. Oh, was Moody's? S and P's? Thank you.
Speaker 3:The the S and P did downgrade The US, but I think it was about I wanna say it was about over ten years ago.
Speaker 1:So Moody's
Speaker 3:have come down to the same level that we were, like, kind of
Speaker 2:ten years ago.
Speaker 1:Okay. Well, yeah, we'll take it up with Moody's. Anyway, I'd love to I'd love to go through some of the folks that you've interviewed and hear some stories. Why don't we kick it off with Ken Griffin? Break down his his career, your experience chatting with him, and what you learned from him.
Speaker 3:Yeah. Sure. So I can kind of give a quick overview as to, like, why I'm meeting these guys, like, why I'm in a situation where I can meet them. So, essentially, my role at S and P in the ratings division is to engage with the buy side Mhmm. The big buy side investors.
Speaker 3:So after about six months, and I've been doing this previously at other roles, I felt like I need, like, a platform to essentially kinda make it easier for me to do this Mhmm. With these senior guys. Because trying to get as you guys know, trying to get a meeting with these senior guys from the finance side can be tricky unless you've got something very hot for them. So I created this podcast and just said, listen. We're gonna have a chat.
Speaker 3:It's gonna be, like, half an hour.
Speaker 2:We're gonna talk about you. We're gonna have
Speaker 3:a guest from S and P. Mhmm. And we're gonna kinda give you kind of one question to you, one to the S and P person, and see how it goes. And that was like five years ago. So now it's kind of grown slowly.
Speaker 3:I mean, I don't do many. I do, like, one a month, so it's not as prolific as you guys doing four hours a day. Yeah. But it's it's grown slowly over the years. So now we can meet those type of guys.
Speaker 3:So to answer your question and just a quick plug, the podcast is called Leaders. If you wanna look it up, it's called Leaders.
Speaker 1:Go go listen.
Speaker 3:But in terms of Ken Griffin, so we I am I mean, the actual podcast came about from I create a LinkedIn post, like, old story about Ken, which I don't think many people knew, which was this was, like, fifteen years ago. One of his assistants actually had terminal cancer, And he funded her treatment for two years secretly kind of without telling anyone. And she she got into remission. You know? It was kind of a miraculous turnaround.
Speaker 3:And then after that, he funded her to go to Hawaii with her family for, like, a two week holiday and didn't tell anyone about it. And I thought that was, you know, quite a cool story. So I found out about this through, like, a tiny in, like, one of the Chicago kind of newspapers, an old PDF from, like, 2009 I wrote it up on LinkedIn. It's just like a story post, which sometimes I do. And then I said, you know, I just sent it to Ken saying, like, listen.
Speaker 3:Just thought this thing was really cool that you did with this lady. And then he replied back, and I was like I was like, oh, wow. He replied. So I said, do you wanna do a podcast? And he's like, yeah.
Speaker 3:No problem. So that was, like, six months later. And last month, we recorded in New York. And I'm I'm sure, like, listeners know who Ken Griffin is, but, obviously, he's the he's the CEO and founder of Citadel. So you've got Citadel, the hedge fund, which is this enormous hedge fund, but you've also got Citadel Securities, which is the market maker, which is I think it's probably I think it probably is the largest market maker in the world.
Speaker 3:So he's a really he obviously, a very smart guy. So we interviewed him in person last month. And, you know, he is like he's just as you would expect for someone who is that successful in their life. Like, he kind of like, he he's very good at answering questions, very succinct, can give you kind of a one minute answer to anything, and he kind of sums everything up in, like, a really crisp way. Mhmm.
Speaker 3:And he's also very, like you know, he's very personable. So he came out the lift. I'm waiting for him, the lift, and he comes out the lift. And he has like a group, like an entourage around him, and I can see someone telling him something, like just whispering him something quickly. And I'm like, okay.
Speaker 3:What's what I wonder what's kind of been said. And then in my head, I'm like, oh, they're telling him who I am probably. They're probably saying, oh, this is Joe. He's from S and P. You're gonna do a podcast right now.
Speaker 3:And he comes up to me and he's like he's like, very strong handshake, looks me direct in the eye, and he's like, I am so thankful that you invited me. Thank you so much. And I was like, you
Speaker 1:know Rude.
Speaker 3:It's such a crazy you know, to me, he's literally you know, I'm just like another person for him, but he he probably has this kind of intense kinda state which he's in, which is just amazing to to witness. And he has his aura around him, and I I don't wanna use the kind of Rick James analogy, but he does have this, like, aura around him where he's like you know, you can feel him in the room, and you can you can feel his his expectations of his team and of and of you. Like, of me as an interviewer, kind of I was like, okay. You know, you're you're sitting up straight. You're making sure you have everything down to a tee.
Speaker 3:So I was kind I can you can see why beyond the kind of obvious fundamentals of Citadel, you can see how that energy probably permeates through the whole company just through his kind of vision.
Speaker 1:Do you notice any difference between the Ken Griffin archetype and son of and some of the more behind the scenes financiers? Like, I imagine it's very hard to get someone from from Jane Street on the show because they seem to be quieter, and yet Jane Street does do technical talks, but you don't hear from the founders that often. Do you know do you understand what dynamic is going on there? Is does Ken just view media differently, or is there something structural going on with his business that it makes sense for him to have more of a of a public presence than a pure high frequency trading focused firm that maybe doesn't have to interface with I mean, they still have to recruit, but maybe they just have a different PR strategy.
Speaker 3:Yeah. It's it's interesting. I think I mean, my sense is that it's quite Ken led. Mhmm. So Ken has lots of things to say, and he's super, super smart.
Speaker 3:Mhmm. And he's not afraid of saying Mhmm. So I definitely got that vibe from him. But, you know, there's kind of no no holds bars. He's not he's not just saying something because he thinks he should say it.
Speaker 3:He's honestly giving you his opinion
Speaker 1:Mhmm.
Speaker 3:Of something. And, also, I mean, I I don't know many guys at Jane Street, and I I I haven't actually reached out to those guys probably because I thought it would be a no because they're so kind of closed.
Speaker 1:They do seem closed, but maybe they could break through.
Speaker 3:These sometimes with these guys, they're closed, they're closed, they're closed until they're not. Yeah. So until they need to not be closed and they need to have a voice. So it's it's kind of a the long game, I guess.
Speaker 1:Jordy, you have a question?
Speaker 2:Switching gears a little bit. I'm curious, your job, you know, on the rating side of S and P, how much more challenging it gets when we're in this sort of critical macro environment and things are kind of unfolding real time that impacts businesses, banks, things like that. How do, you know, how do you guys approach, you know, situations like we've had even in the last week with with Israel and Iran and and and other situations like it?
Speaker 3:Yeah. It's a it's a good question. So, obviously, my role being on the kind of investor engagement and investor relationship side, we hear a lot, you know, in terms of these kind of large, huge events. And, obviously, we've had the things in the past week, but we've also had the tariffs.
Speaker 1:Mhmm.
Speaker 3:So it it promotes kind of a huge spike in inbound for us. We're we're very keen to be kind of outbound and, like, forward facing, transparent, etcetera. But there's no doubt that those kind of occasions, everyone wants to speak to us. I know for good reason. But, also, I think, you
Speaker 2:know So the big institutions reach out to you guys and ask you what what else are you seeing broadly? Is that is that how how
Speaker 3:it works? Yeah. Absolutely. So it's kind of what you guys seeing at kind of a macro level. What do what does kind of the x situation that's happening right now, how could that impact this group of ratings?
Speaker 3:It could be kind of financial services or it could be large corporates, and they drill down to kind of one sector. So I, you know, could have someone calling us from one of the largest buy side firms saying, listen. I work on autos, strictly autos kind of portfolio. How will this be how will the tariffs impact my portfolio, the ratings? What's your view?
Speaker 3:Just to kind of sample with us. And we we have, like, pretty much every week, you know, London, New York, Hong Kong, we have these investor roundtables where we engage with these kind of small communities. We speak to them. We have our analysts speak, and they can kind of, you know, sandboard their ideas, and we can we can go back and forth.
Speaker 1:Very cool. I wanted to move on to some other folks you've you've chatted with. I wanna hear the story of Ray Dalio, obviously, the the the founder of Bridgewater. He feels like someone who was maybe a little bit behind the scenes for a while building the fund and then principles that p it was originally a PDF that just kind of, like, found its way onto the Internet. I think they might have published it.
Speaker 1:Then eventually, it turned into a book, a book tour, banger, viral videos, podcast appearances. But what was your experience like with Ray Dalio?
Speaker 3:Yeah. I I I it was fascinating. It was totally fascinating. So we had Ray on the show, in kind of I think it was 02/2012, 02/2022, I think it was. So kinda two and a half years ago now, just coming out of the pandemic.
Speaker 1:Yeah.
Speaker 3:And, like, we booked we had we have everyone booked for, like, forty five minutes.
Speaker 1:Mhmm.
Speaker 3:And I think kind of because usually it goes on for about half an hour, and we want some just overrun time in case stuff goes wrong. And Ray spoke for you know, it was coming up to two hours to the point. So he was very generous with his time. He had lots of things to say. And, like, he has lots of things to say on lots of different topics.
Speaker 3:And he's very good at kind of connecting the dots, like making links. So for example, when I was speaking to him, yeah, I kind of asked some some crazy questions, some some off the wall questions to try and make it interesting. So I was talking about my first job at McDonald's. So I used to work on the first window of the drive through and, like, take the order for people in McDonald's here in here in in my hometown. And then Ray was like, oh, it's so funny you say that because I set up the hedging strategy for the McNugget.
Speaker 3:So the only reason the McNugget is on the menu is because I set up this trading strategy for McDonald's and the supplier. That's amazing. He's very good. He's very he's very cool guy, but he's very like you know, he's very personable and and he's so good at like linking a to b.
Speaker 1:That's that's hilarious.
Speaker 2:You always gotta be hedging your McNuggets.
Speaker 1:You know? Yeah. Yeah.
Speaker 2:It's a
Speaker 7:good I've
Speaker 1:heard about that.
Speaker 2:I mean,
Speaker 1:metaphor for supply chain. And, of course, McDonald's doesn't want, you know, exposure to all that. And there's, like, that famous example of, like, Southwest successfully hedged gasoline prices for a while, and that was a massive beneficiary of that for a long time. These, like, small little kind of minute financial operations downstream, like the CFO is just kinda off doing something, can have, like, a massive impact on the trajectory of the business when they pull it off. Talk to me about Ryan Serhant.
Speaker 1:He feels like someone who is potentially underrated as a business leader, business thinker. People know him as a reality TV star essentially, and yet he's built this massive media business. You're obviously in the media industry. We are as well. What did you learn from him?
Speaker 1:What was what was what's the experience been like working with him and talking to him?
Speaker 3:Yeah. And he's yeah. My personal opinion here, not S and P's, he's a very he you know, he's someone to look look out to, especially in this space. So he you know, as you say, he started off from reality TV
Speaker 2:Yeah.
Speaker 3:Which, you know, sometimes, you know, especially people in The UK, they kinda look down their nose Mhmm. At those type of people.
Speaker 2:Of course.
Speaker 3:So when he started to kind of how he leveraged his appearance, but also his media, like, his content is is enormous. I think across all platforms, it's something like seven or 8,000,000. Wow. He has, like, multiple YouTube accounts. He has Instagram.
Speaker 3:He has TikTok, all the kind of usual suspects. He has LinkedIn. And he has his content content to commerce model whereby I met him when I was in New York just to talk about this just randomly. And I said, listen. I'm New York.
Speaker 3:Do wanna talk about this? He was like, yep. And so we just met up and spoke about this very thing whereby he has, like, different. His client base could be, you know, super, super high net worth Mhmm. Or it could be kind of someone looking for, like, a $1,000,000 apartment in New York, or it could be potentially the child of the client.
Speaker 1:That's a big one.
Speaker 3:If so so he's very smartly said, listen. I just wanna spread the board with this. So we've got the YouTube for the kind of, like, millennials. We've got TikTok for the younger guys. So if and, yeah, I said, listen.
Speaker 3:What does this mean, like, in terms of, like, revenue, basically? Mhmm. And he said, well, we sell this, like I can't remember how many million, but
Speaker 7:it was
Speaker 3:like it's very expensive property off the back of one of the children seeing a TikTok. So crazy. Said, look look at this thing. Look at this thing this guy's selling in New York. They showed it to the mom and dad.
Speaker 3:Mom and dad said, that's great. Let's go and have a look at it, and, you know, and then it's sold. So, like, he's he's definitely got, like, a very interesting model, which, to be honest, I think, again, me personally speaking at S and P, lots of other kind of industries, sectors could could kind of adopt this model. I don't know why they're not. It's it's it's kind of been proven now.
Speaker 1:Yeah. Yeah. Yeah. I've I've heard that story before, and I've I've I've heard that he has something like 60 to 80 people working just on content in his organization to really pipeline everything out across, like, across all the different platforms. And he's cast a very wide net, but he's built a fantastic business around it.
Speaker 3:So when I was
Speaker 2:there Last last
Speaker 1:Oh, yeah. Yeah. No.
Speaker 2:I had a totally unrelated question that I can cap it off with if
Speaker 1:if Please cap it off.
Speaker 2:This is fantastic. I wanted to get your read since you talk to a lot of these buy side institutions. How are people thinking about ESG today? Mhmm. Is it still are they, you know how do they feel on a personal level?
Speaker 2:And then what do their actions look like at on an investment level?
Speaker 3:Yeah. I think mean, on a personal level, it's kind of tricky to to answer that one because I can probably answer on, like, professionally what they're what they're telling us
Speaker 1:Mhmm.
Speaker 3:An institutional basis. So in kind of '21, '22, the ESG kind of it was it was just enormous. It was we couldn't have a conversation with an investor about anything without them mentioning ESG in some way. You know? And how does this link to ESG and or the s or how does this the g factor into this stuff?
Speaker 3:So whereas now, especially kind of in the past, I don't know, six months to a year, maybe a bit longer around that time, it's I'd say it's definitely a part of their kind of investment thesis, but they're not necessarily pushing it to the front. So I don't think that they've kind of, you know, totally dropped this idea. I definitely don't think that's the case because we still got lots of inquiries. We have lots of conversations around sustainability. Not so much I mean, the brand of ESG seem to have kind of died, but sustainability is is growing in in the amount of kind of inbound and outbound we're having, the products we're seeing in the market.
Speaker 3:There's lots of I'd say it's definitely not kind of just been dropped, which I think may be the perception by some people.
Speaker 1:Totally. Yeah. That's makes sense. Well, thank you so much for stopping by. This was a great conversation.
Speaker 1:We'd love to have you back, and we will talk to you soon. Enjoy the enjoy the evening. Thank you so much for staying
Speaker 3:in the morning. Long journey. Thanks so much,
Speaker 7:man. We'll
Speaker 3:talk to
Speaker 2:you soon. Cheers.
Speaker 1:Well, let's go back to the timeline and run through some posts. We mentioned it earlier, but DHH raced in the twenty four hours Le Mans. Base Camp Mobile.
Speaker 2:Base Camp Mobile.
Speaker 1:Number 22 is ready. Let's go. So congratulations to him. He's he's driven it multiple times now.
Speaker 2:Wait. We have to try to figure out how he actually did.
Speaker 1:You work on that. I will stay in automotive world. Nick Cruz Pattanes says hailing a Tesla robotaxi directly from the X app would change the game. There are approximately 600,000,000 active users per month on X. Interesting.
Speaker 1:There's already a lot of buttons in the X panel. Grok, you got chat. There's a signal competitor now. There's communities. I always wonder about how much you can how much you can add, how much you can bloat before you need a separate app.
Speaker 2:I already slapped some AI in there. Why not slap some robotaxis in there too, John? I got the results pulled up. Please. DHH says, we had the pace for a podium, but power stealing failure in a missed pit stop meant p seven.
Speaker 2:Still the greatest race in the world.
Speaker 1:That's amazing.
Speaker 2:The it's so funny because you don't think of Basecamp as like a super active major advertiser. No. Right? Like they like to do this the the have the product do the talking. Yeah.
Speaker 2:But, it looks fantastic on Looks great. On some race gear. So Congratulations. Congratulations. P seven.
Speaker 2:The car looks fantastic as well. So I'll have to have him on the show to break it all down.
Speaker 1:Totally. Mike Newpe had some interesting reporting from TechCrunch. Waymo rides are costing more than Uber and Lyft and people are paying anyway. He says, true for most automation scenarios given machine intelligence on par with human capability for a task. Machines offer lower variability and will be preferred even commanding a premium on price.
Speaker 2:Big call.
Speaker 1:Yeah. This is what Chris Spike was talking about. Yeah. The the idea of, like, if if you are a gating function to getting the thing that the person wants and you're not in that leisure category, the the the robot will be preferred. But, yeah, I mean, it makes sense.
Speaker 1:Have you you ridden at Waymo yet? I don't think so. Right?
Speaker 2:I have not.
Speaker 1:I've I've taken one ride in SF. Was pretty nice.
Speaker 2:We should call one today. Take it around the block.
Speaker 1:I don't think they're I don't think
Speaker 2:they're in LA right now. I think they
Speaker 1:actually did left. I think they I don't know. We'll have to figure it out. But I I think they might have actually shut it down for a
Speaker 2:little bit. Long march back to San Francisco.
Speaker 6:I don't think so.
Speaker 2:We got another post here from laser boat nine nine nine.
Speaker 6:Love it.
Speaker 2:Coke tastes like tapping into your ancestral ancient ancestral petroleum reserves while Sprite tastes like being connected to a big beautiful energy grid.
Speaker 1:1,400,000 views. I love it. And then Celsius, daybreak over the computer world. A real grasp of the English language. Fantastic.
Speaker 1:People are really enjoying posting about Diet Coke and Coca Cola and all the sodas right now. The the Diet Coke
Speaker 2:They've never been better. They've never been better. Yeah. They're peaking.
Speaker 1:Yeah. They're peaking.
Speaker 2:They're peaking.
Speaker 1:Yeah. And the organic marketing is working. I love it. In an era, you'd have been homer with that. That is spectacular.
Speaker 1:I completely agree. What a fantastic post.
Speaker 2:Big beautiful energy grid. Anyway We have a post here from Searcy. Searcy. I Don't cry. If I see a guy in a suit at the airport, I just assume he works for Deloitte.
Speaker 2:Or is this technology
Speaker 1:and business podcast
Speaker 2:here? Technology businessman.
Speaker 1:Who knows?
Speaker 2:Could be an international businessman.
Speaker 1:This is quote you do.
Speaker 2:Don't see international businessmen flying in suits anymore. There's almost no suits in business class.
Speaker 1:Not yet. They're coming back.
Speaker 2:The the level of disrespect people have for the airport wearing joggers.
Speaker 1:Yeah. Exactly. Yeah. If you want the pilots to
Speaker 2:take this What are you running from?
Speaker 1:Yeah. If you want the pilots to take the the safety of your plane seriously, maybe you should take
Speaker 2:Yeah. Imagine imagine getting on a plane and the pilers wearing athleisure. Yeah. No. Not gonna happen.
Speaker 2:I am cooked.
Speaker 1:Not gonna happen.
Speaker 2:I am cooked.
Speaker 1:Yeah. You should be thrown out.
Speaker 2:I wanted to shout this out. The Cadillac f one team just posted
Speaker 1:Let's go.
Speaker 2:Over 60 jobs. So if you are wanting to work for, you know, an American, a true American luxury brand
Speaker 1:Yes.
Speaker 2:In Cadillac Yes. Or get involved with f one, Head on over there. I'm excited for them to hit
Speaker 1:the They really are hiring in every department. They have, like, finance operations people and all sorts of stuff. Get into Cadillac f one. Get them on ramp.
Speaker 2:Huge alpha there.
Speaker 1:Play the long game.
Speaker 2:Huge alpha there.
Speaker 1:Chess.com. Sahar says, between June 2020 and December 2022, accounts on the site jumped from 35,000,000 to a 100,000,000. I joined during that time. It had taken fourteen years to bring in those first 35,000,000. Wow.
Speaker 1:Pretty pretty historic run for checks chess.com. The business is doing great. Privately owned, founded in 02/2005, makes most of its money from subscribers who pay $5 to $15 a month for features such as unlimited play and post match analysis. ARR, it's over a $100,000,000. So congrats to the chess.com team.
Speaker 2:Amazing.
Speaker 1:We haven't hit the gong today. We gotta hit it for chess.com.
Speaker 2:Hit it for them. Hit it for them. We should also hit the gong for Eli Lilly because someone at Novo Nordisk failed to pay a $450 maintenance fee, which would have kept its patent on Ozempic enforced for another two years.
Speaker 1:This is such a crazy story. That's like what? Like $50,000,000,000 of value or something like that for $450.
Speaker 2:Just absolutely brutal. Maintenance fee.
Speaker 1:What a what a mistake.
Speaker 2:Good reminder.
Speaker 1:It is it is
Speaker 2:All the people with IP out there, go pay those
Speaker 1:maintenance fees. Yeah. Yeah. This is a use for AI agents just constantly trolling for what fees am I not paying. Read every email inbox.
Speaker 1:Check-in with all of the different patent databases, and make sure that we're we're up to date on our maintenance fees because $450 costing you billions is insane to me. Anyway, there's a beautiful size
Speaker 2:con size con four or Gekko. You wanna hit it?
Speaker 1:Let's hit it.
Speaker 2:Gekko Robotics has raised one raised a 125,000,000 at one point two five. They build robots and AI software to inspect and improve important infrastructure like power plants, factories, and military systems.
Speaker 1:I think Trey Stevens is on the board. It's very, very cool. It's like these the the these robots crawl around like Oh, yeah. Yeah. Yeah.
Speaker 1:Yeah. So if you have a massive industrial equipment, you know, like a massive, like, grain silo or, like, oil and gas, like, you know, silo that's holding a bunch of, like, a refinery, the the robot will crawl up and down and scan and take images and understand, oh, there's a structural weakness here. There's a crack here. The paint needs a touch up here. All of those different problems.
Speaker 1:And it's it's yeah. It's just cool because it's like it's they are very much a scaled business. Like, they really do make these robots. They're not humanoids. They're highly specialized.
Speaker 2:So crazy,
Speaker 1:baby. Crawl
Speaker 2:around buildings.
Speaker 1:Very, very cool. Wild. Chad Hurley, the founder of YouTube says, honestly, this means more to me than any acquisition. He sold YouTube to Google. But there's a travel vlogger who met a young Iranian boy who basically speaks perfect English all because he watches YouTube.
Speaker 2:I watched this video. The kid is has a better grasp of the English language than most adults I know. He's very, very well spoken. Yeah. Bullish for English.
Speaker 2:Honestly, this was probably the biggest news of the last week.
Speaker 1:This is staying
Speaker 2:in YouTube Sulek had a work a back workout with Arnold. Okay. And yeah. So, I mean
Speaker 1:Broke the Internet.
Speaker 2:One of the more important stories.
Speaker 1:4,000,000 subs. Absolutely crushed it. Only two years ago or three years ago. And credit to Zach Prograb, he says Sam Sulik is a great example of where content is going. Back in 2023, August 20, he's like, this is this guy's on to something.
Speaker 1:He's on he's the future. And then, of course, he he got his IFBB pro card absolute on absolute terror and has put out a ton of great content. Value of daily posting, for sure. Just 1% better. The vlogs get better.
Speaker 1:Daily poster. If he was doing it weekly, it'd be much harder. Anyway, there was this this odd news about the New York Times reporting that Chatuchi a guy into insanity followed by suicide by cop. A human being is dead in passing. This falsifies the alignment by default.
Speaker 1:Cope, who whatever's really inside Chatuchi BT, it knew enough about humans to do this. And so, Justine Moore says, it's ridiculous to say ChatGPT talked a guy into insanity when he had been diagnosed with schizophrenia and bipolar before he started using ChatGPT. This is a tragic story. The man was clearly mentally ill. Messaging with a chatbot didn't kill him.
Speaker 1:Very, very sad story. But, yeah. I mean, obviously, this is not the this is not the responsibility of the of the AI, but Yeah. It is an opportunity for Chi GPT to potentially step in and and and help treat someone. And we've already seen promising results in therapy.
Speaker 1:And and, of course, there will be an interesting dynamic about when does it call the cops on you if you are planning something? What if it if it attacks that you are insane, what should it do with that information? Because there's a lot of privacy and and individual rights that are potentially infringed upon, but at the same time, could have could have had a much, much better outcome here. Yeah. But very, very, very rough story.
Speaker 1:Anyway, let's move back to Jane Street. We talked about them earlier. Instead of Ynon competes, Jane Street decides to make its own programming language so far from anything mainstream that you can't get a job anywhere else. Not entirely true, Bubble Boy. If you know OCaml, you can probably write Python.
Speaker 1:But, yes. They're they're
Speaker 2:branching it is is the thing.
Speaker 1:Yes. They're creating their own. But Ocaml was already, like, basically entirely maintained by Jane Street. Ron Minsky has, like, the main YouTube video about Ocaml, this, like, low level machine language. It's almost at, like, assembly level.
Speaker 1:Very, very performant, very fast. And Jane Street, I think, has been the main contributor to that programming language for years, but now they are branches.
Speaker 2:Camels, llamas Yeah. Dogs, pigs. They're having a moment.
Speaker 1:They're having a moment. O'Campbell has been around for twelve years, something like that. Ron Ron Minsky, he put out this YouTube video. I actually watched it back in the day. Was great.
Speaker 1:He's he's an absolute beast. It's one of the few pieces of Jane Street content that's out there or or was. It was like this interesting lens into into the way Jane Street builds their high frequency trading algorithms. They need to
Speaker 2:be Yeah.
Speaker 1:Extremely performant, extremely accelerated. And so they now have their own their own programming language. So congrats to the Jane Street team.
Speaker 2:We have a post from GoDinny.
Speaker 1:Good day.
Speaker 2:Probably botching it. I can't articulate exactly why, but this generation of B2C founders feels like the tech equivalent of SoundCloud rappers.
Speaker 1:I wonder who talking about.
Speaker 2:Yeah. Somebody else was posting that this feels like the generation of founders raised on YouTube. Yeah. Which makes sense.
Speaker 1:I mean, they're already extremely good at viral content. Is that entirely new? I think so. There's been other people that I mean, consumer founders have understood viral growth loops for a long time. I mean, the Airbnb guys were doing stunts like the the political serials.
Speaker 1:That was very much like a stunt. Yeah. But it was like fun. Know, obviously, the some of the early Mark Zuckerberg experiments at at Harvard were very designed to go viral.
Speaker 2:And Designed to go viral or designed to scale rapidly or or Yeah. Like there's this thing that I'm seeing in the timeline of of founders sort of consistently trying to do things that that piss people off
Speaker 1:Yes.
Speaker 2:Or or like are just trying to be attention grabbing without necessarily using it to drive any type of business results.
Speaker 1:Yeah. Yeah. I mean, like you can get a lot of downloads and and attention just by rage baiting the timeline. But Yeah. That
Speaker 2:Low quality.
Speaker 1:Yeah. It just doesn't scale infinitely. Like eventually, like you just figure out that like getting a million views is doable every week, but it's just a million views. It's not something that's truly, like, going to scale endlessly. Like, the performance marketing, you know, playbook or a true viral growth.
Speaker 1:Like, you compare it to, like, the the viral growth engine at Dropbox where, you know, I give you storage. You you come on. I get storage, and there's this there's this loop or, like, referring people to Gmail, like, the classic viral loops that continue to grow even among people that don't need to necessarily see your viral rage bait. So there's always a question about, like, like, once you have that attention, you have to shift into something that's more durable and more scalable.
Speaker 2:Totally.
Speaker 1:But I don't know. Maybe they'll take the lesson. The last the last viral rage bait didn't really go as But we'll see. We'll see.
Speaker 2:Well, we have a poster from Christovasilov.
Speaker 1:Tyler Cowen called Take
Speaker 2:a screenshot from Tyler Cowen's blog. He says, this was March
Speaker 1:fourteenth March 14. Only three months ago.
Speaker 2:When will Israel attack Iranian nuclear facilities? He says, it seems this ought to happen soon though it is not yet a major news item. Iranian air defenses are severely disrupted though not forever. The Hezbollah counter attack has been more than neutralized and no alternative deterrent has been put in its place. That too may be temporary.
Speaker 2:Israeli public opinion is still close in time to October 7 and Netanyahu is not so far from the end of his reign. Netanyahu started his reign when I was six months old.
Speaker 1:Is he supposed to wind down soon? Don't know when I don't know when his term is up, but certainly feels more than four or eight years. Like, he's been over there for a while. I are are you sure it's been twenty years,
Speaker 2:or has he just been being covered? To prime minister in 1996. Oh, wow.
Speaker 1:Okay. Interesting. Countries that will
Speaker 2:The election is 11/03/2026.
Speaker 1:Okay. So a little over a year. Yeah. Got it. The countries that will get very mad at Israel for such an attack are already close to maximally mad at Israel.
Speaker 1:Trump has signaled plenty of support, yet there is no guarantee that will last forever. Most of all, Iran is getting closer to having a workable nuclear weapon. I also find it striking how many people discuss the Ukraine negotiations without considering the two issues may be tied to some degree. How much will Putin, if at all, shore up Iran in in such a scenario? Just a reminder that you should not forget about this issue.
Speaker 1:It could be the most important thing that happens this year. Wow. He really, really called it. And zero comments. Like like, just was like, yeah.
Speaker 1:Okay. Yeah. He's saying But, yeah, he he he called it, and now people are looking. Congrats to the Workweek team, Adam Ryan. One year ago, we launched a bold experiment.
Speaker 1:What if there was a real social network for business leaders? No self promo, no influencer fluff, just verified operators helping each other. And they're seeing 10 x growth in five months, 51% acceptance rate.
Speaker 2:Did you see who was who was shouting them out to?
Speaker 1:Lance Armstrong. Oh, wow. Crushing. Adam I
Speaker 2:had to throw this in there. Lance is an early investor Yes. In Workweek. I
Speaker 1:was He's investing in a lot of stuff now. Has a whole fund.
Speaker 2:Yeah. Yeah. He's he's running it. I was on the Workweek board through the series a, and it's just been amazing to watch them execute over the last year.
Speaker 3:Congrats.
Speaker 2:The company is ripping and I thought it was cool that that Lance was was throwing a little shout out here.
Speaker 1:That's great.
Speaker 2:Anyways, I thought this was posted on Friday but it was just funny. Gotta include it. This Neil Renick, wow. What a stressful week at work. Time to relax by holding a phone beaming endless streams of horrific international news inches from my head.
Speaker 1:It's ridiculous. It 220,000 likes. Everyone's feeling the exact same thing. And that really was this weekend. Like, I went to the beach on on Sunday, and all of Los Angeles was just peaceful.
Speaker 1:I I mean, I saw I saw one train of, like, cop cars kind of moving from one part of the city to the other, but didn't see any protests, didn't see any real fallout. Like like, things were pretty quiet in America generally. But you go online, and it's just like I mean, you read, like, the cover of the Wall Street Journal, and it's just like flames and insane. Yeah. That picture is crazy because there's crazy stuff happening in the world.
Speaker 1:But, fortunately, due to the the amazing technology, it's beamed directly to your face.
Speaker 2:Yep. In other news, the founder PumpFun as well as PumpFun have been banned from X.
Speaker 1:Oh, why?
Speaker 2:And I was seeing this because Dan Romero posted something something decentralized doesn't matter until it does. Farcaster is sufficiently decentralized version of X. So he's kinda making his case there, but we'll see how that evolves. But overall, slow news day.
Speaker 1:Pretty slow news day. Only geopolitically. It's a it's a great time to be a political podcaster. You got Trump, Elon, Waymo's. You
Speaker 2:got Iran.
Speaker 1:You got assassinations. There's so much stuff. Us over here, we gotta talk about technology. So maybe tomorrow we break down the Warner Brothers Discovery split, some HBO stuff, some sports stuff. I think it'd be fun to do a deep dive on Le Mans and some of the history there.
Speaker 1:Yeah. There's a lot that we could go into in different directions.
Speaker 2:Have a absolutely insane lineup.
Speaker 1:We have an insane lineup tomorrow too. So I don't think we're
Speaker 2:gonna able to lot
Speaker 1:of that. We have a lot of range, and it's gonna be a lot of fun. And so stay tuned for tomorrow because we have a we have a banger lineup. Well, you'll hear about it in the morning.
Speaker 2:Thank you for tuning in. Thank you to our incredible production team. Thank you to Tyler who learned all there is to know about biotech today.
Speaker 1:Yes. He's in the home of the golden retriever, GLP-one. I like the AI generated You
Speaker 2:got Tyler?
Speaker 6:Yeah. I actually I found this
Speaker 1:Pretty good.
Speaker 6:Concoction I've cooked up.
Speaker 3:Okay.
Speaker 1:Do you
Speaker 2:want me to Okay.
Speaker 1:Let's let's hear it.
Speaker 6:Okay. So this is optimal, you know, golden retriever maxing. Okay. So there's three parts. Right?
Speaker 6:Hotter, friendlier, dumber.
Speaker 2:Mhmm.
Speaker 6:So for for hotter, I have melon melanin melanotin.
Speaker 2:Okay.
Speaker 6:It's like for it's like injections to get you more tan.
Speaker 1:Oh.
Speaker 6:You know, so you can have a nice bronze.
Speaker 1:Okay.
Speaker 6:The next one is growth hormone peptides.
Speaker 2:So I think Jordy knows a lot about peptides.
Speaker 1:Yep.
Speaker 5:Yeah. So what it That's kind
Speaker 2:the king peptide. Yeah. You can do a lot of stuff around human growth hormone, but at the end of the day, if you're really, you know, playing to just do it.
Speaker 1:Okay. Sounds good.
Speaker 6:Okay. And now the third one I have for hotter is blood transfusions from young people. That's like an popular intern there.
Speaker 2:Would like an intern be good? Like a summer intern?
Speaker 1:Yeah. Would you recommend
Speaker 2:pulling from a summer intern? Do not do not be a summer intern for Brian Johnson. He will you you will will be turning to a black boy.
Speaker 6:So then the next for friendlier, I have two, you know, items. The first one is MDMA micro dosing.
Speaker 1:Oh, okay.
Speaker 6:So I haven't haven't tried this myself, but it could be interesting. The next one is oxytocin nasal sprays.
Speaker 1:Yeah. That's the love chemical. Right?
Speaker 6:Yeah. So this is supposed to increase people's trust. Sure. It makes you more generous, more empathetic.
Speaker 1:Okay.
Speaker 6:That's some somewhat dog like.
Speaker 2:I don't know why that just seems so wrong. Just like a But at the same time, I mean, has like a, you know, a a I'm sure a similarly strong effect, but just for beetle Well,
Speaker 1:it doses the poison, so you dose it correctly. Maybe there's something there. Interesting. Okay. Anything else?
Speaker 6:And then the last one is for the dumber. Yes. So the first one I have is scopolamine.
Speaker 1:Okay.
Speaker 6:So this apparently makes people confused, extremely compliant, and forgetful.
Speaker 1:Oh, okay. This could work.
Speaker 6:There we go. The next one is a prefrontal lobotomy.
Speaker 2:Okay. I think people have tried this Yeah.
Speaker 1:Throughout history. Going too far here.
Speaker 6:Two and then and then third one is, just lead.
Speaker 2:Lead. Just lead. Just lightweight lead. Well Just a little lead. If you wanna have some lead, just drink tap water.
Speaker 2:There you go. Got to get you covered.
Speaker 1:Good luck to you.
Speaker 2:Well, thank you for thank you for Thanks for job. Solving one of humanity's most pressing, you know, health challenges.
Speaker 1:Indeed. Indeed.
Speaker 2:How do we be more golden retriever like? Anyways, great show. We'll be back tomorrow. I'm looking forward to it. There'll be some big news.
Speaker 2:We'll talk to you tomorrow. We hope you have a fantastic Monday afternoon and evening.
Speaker 1:Goodbye.
Speaker 2:Cheers.