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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.
Welcome to Technology Brothers, the number one live show in tech. We are live from the Temple Of Technology, the fortress of finance, the capital of capital. Today is Friday, 02/21/2025, and this show starts now. We got an amazing lineup for you today. We got a $1,000,000,000 hack, a $40,000,000,000 fundraise, and a $2,000,000,000 beverage acquisition.
Speaker 1:We're also talking about Ferrari. We're talking about James Bond. The size gong is gonna be coming out a lot today. Jordy and I are white pilled. We're in white suits.
Speaker 1:Things are great.
Speaker 2:Beautiful day.
Speaker 1:It's a beautiful day. So get pumped. Get excited for this show. Let's start with the hack. $1,400,000,000 is missing.
Speaker 1:Where to go? Who lost it? Break it down, Jordy.
Speaker 2:Okay. So as usual, once a month in crypto, a billion dollars is stolen.
Speaker 1:It's really like I saw this you told me about this article, and I was like, okay. Like, why should I care about this? Why I
Speaker 2:don't know why it is, but it seems like it's always toward, as the market starts to dip that the chaos really kicks off. But, anyway so Yeah.
Speaker 1:Bring it down.
Speaker 2:For those that are hearing this for the first time, Ethereum is falling at the moment as as crypto exchange Bybit confirms a $1,400,000,000 hack. So this was going down this morning. I woke up around 04:30. I think news was, like, starting or there was rumors.
Speaker 1:Yep.
Speaker 2:But early this morning, the CEO had confirmed Mhmm. That there was indeed a hack. K. Crypto prices are broadly falling Friday, following confirmation that major centralized crypto exchange Bybit was hacked after $1,400,000,000 worth of tokens were stolen in a hack. And so, you know, the the the hacks in crypto happen on centralized exchanges.
Speaker 2:In many ways, those are more rare and that there's more controls put in place. They're more professionalized. A lot of the high profile hacks have just happened on these sort of DeFi protocols where one person is has the keys for a wallet.
Speaker 1:Yes. More like social engineering. Right? Like, there's the engineer who had the key to the actual wallet, and they clicked on a phishing link, or they got scammed, or they
Speaker 2:Or a North Korean a North Korean dev, you know, gets
Speaker 1:Push some code.
Speaker 2:Push some code, etcetera. So, anyways, what happened here, more than $1,400,000,000 worth of Ethereum
Speaker 1:and, and
Speaker 2:Staked ETH. Staked Ethereum were withdrawn from Bybit's hot wallet on Friday, and a large chunk of the funds were being sold via decentralized exchanges. So it's actually a graphic of this. I don't know if we have it lined up on
Speaker 1:the show. On the show.
Speaker 2:You
Speaker 1:can scroll down.
Speaker 2:Basically, this $1,400,000,000 was stolen and then immediately distributed across hundreds of wallets to be sold off. Sure. And so that's obviously a lot of sell pressure on Ethereum.
Speaker 1:Yep.
Speaker 2:Bybit cofounder and CEO Ben Joe confirmed the attack in a post on x saying that that the a planned transfer was manipulated in some way and that the funds were swiped.
Speaker 1:Yeah. Here already is, Biden ETH multisig cold wallet just made a transfer to our warm wallet about an hour ago. It appears that this specific trash, transaction was Musked. I don't know what that means. All the signers saw the Musk UI, which showed the correct address and URL was from at safe.
Speaker 1:However, the signing message was to was about to change. Bybit, ETH, multisig. So I don't I actually don't understand any of that. Do you understand what happened? What does Musk mean?
Speaker 2:I mean, to be clear, he's just sharing sort of, like, internal. Internal. So it's possible this is a typo, and it should've said masks.
Speaker 1:Masked. Okay.
Speaker 2:I actually don't know.
Speaker 1:Okay. However, the signing message was, was to change the smart contract logic of our ETH cold wallet. The hacker took control of the specific ETH cold wallet we signed and transferred all ETH in the cold wallet to this unidentified address. All other cold wallets are secure. All withdrawals are normal.
Speaker 1:Ethereum is down 3% on the hour to a current price of 20 seventh, $22,727, while Bitcoin has dipped nearly 1% to $98,000, which is kind of where Bitcoin's been trading around for the last, like, month or two.
Speaker 2:And so a security researcher, Zach xBT, had sort of front run, Ben's, the CEO's post saying that, there were suspicious outflows from Bybit and that a source confirmed to him that it was security incident.
Speaker 1:Yep.
Speaker 2:And he has since added that the ETH is being split between 39 different addresses as the attacker apparently tries to muddle the flow of funds to make them harder to track. And so some other people had commented that it's very difficult to steal $1,400,000,000 even in crypto. Right? Because how do you you know, you have to get those if you want to actually use those funds in the real world, unless you're, you know, part of some global crime syndicate, you've gotta, like, get them into a bank account and even that. You know?
Speaker 2:So Yeah. A lot of steps to actually
Speaker 1:get those from And there used to be, services like, what was it? Tornado Cash where you could kind of put money in and then anonymously withdraw it, and it was very messy. But I believe that was shut down because it was such a money laundering, like, front. It was very controversial because, you know, math is illegal now. Yeah.
Speaker 1:I don't know exactly know where I stand on that. I mostly, just kind of learning the facts on that one.
Speaker 2:But Yeah.
Speaker 1:It it is an interesting case. It is crazy. I wonder how much of this will actually be, retrieved because you can imagine, you know, there's some sort of expected value calculation from these hackers. They're like, yeah. We'll we'll we'll steal 1,400,000,000.0, but we'll send it off all over this place.
Speaker 1:Even if we just walk away with a hundred million, that's great. Totally worth our time.
Speaker 2:Yeah. Somebody was commenting on x saying the hacker should just take, like, a couple hundred million dollars as a fee, give the rest back because they just won't wouldn't be able to wander it anyways. Yeah. Yeah. Yeah.
Speaker 2:So the CEO has come out and said Bybit is solvent even if the hack loss is not recovered. All of client assets are are one to one backed, and we can cover the loss. And so, ultimately, like, this could be a scenario where I I don't know what kind of scale Bybit has, but, if they have to basically use equity to backstop this $1,400,000,000, I mean, really, you know, ultimately damaging to all the shareholders, but at the same time that the shareholders should have responsibility for the security and safety of the assets. And so they come out if they come out and say, you your funds aren't safe on Bybit, they basically, wouldn't have a viable business anymore unless people just forgot that their assets were on there. So Yeah.
Speaker 1:It'll be interesting to see where this goes and, and if they can track people then. I'm sure Coffeezilla is staying busy. But let's move on to a a $40,000,000,000 fundraise that's currently going on, led by Brett Adcock for FigureAI, the humanoid robotics
Speaker 2:company. Lord himself.
Speaker 1:He is a size lord. He has been raising the stakes endlessly, and I'll give you a little background on some of his history here. Sam Parr broke it down when he did a pod with Brett Adcock. He, first sold a company, a hiring software company called Vettery for a hundred million dollars. Then he taught himself about flying, and he built Archer, basically an electric helicopter for short commutes.
Speaker 1:He took that company public, SPAC'd it. And I think it's one of the few, like, hard tech SPACs. It's actually kind of sustained. It hasn't gone down 90%. I mean, look.
Speaker 1:Yeah. Let's look it up on public. And then he made it,
Speaker 2:state. 8% today.
Speaker 1:So Yeah. But, how is it how is it since, like, the SPAC launch?
Speaker 2:It's still up. It's up 25% month over month. I bet some of this is based on
Speaker 1:What's going on in figure? Figure.
Speaker 2:Yeah. Totally. I'm sure the SPAC investors are, you know Yeah.
Speaker 1:Hey. This guy's profile
Speaker 2:is getting raised. You know? Yeah. We're they're gonna put the robots in the Yeah. In the planes when the planes ship.
Speaker 2:You know?
Speaker 1:How do you think those humanoids are gonna get around? They're gonna need they're gonna need to
Speaker 2:fly around. Dude, it this is a huge narrative violation. It's it's up dramatically from the From the SPAC? From the SPAC.
Speaker 1:What what's the market cap?
Speaker 2:In 2021, when it's backed, it came out at 600,000,000.
Speaker 1:Okay.
Speaker 2:It's now at almost 5,000,000,000.
Speaker 1:Wow.
Speaker 2:So who would have thought?
Speaker 1:Is, like, flying cars are not just racing around. So it's still a speculative investment in many ways.
Speaker 2:Yeah. And and, I mean, like, if you look at even in December December of last year, so a few months ago, Archer Aviation stocked them on the alpha feature public
Speaker 1:Yeah.
Speaker 2:Faced a significant drop of 24% due to increased short selling activities and funding concerns. So short sellers got absolutely smoked
Speaker 1:Wow.
Speaker 2:On this one, depending what kind of position they took. But,
Speaker 1:He built figure. He raised $650,000,000 from Bezos, Nvidia, and OpenAI. And now most recently, he has a new thing called Cover, which makes x-ray like cameras that can detect if someone's bringing weapons into schools or stadiums. Yeah. So he's gotten into kind of, like, the the flock safety market a little bit.
Speaker 1:And, yeah. He's been he's been a character in Silicon Valley for a while. And, and but this this particular fund raise has been controversial because, it's it's driven heavily by SPVs, which are special purpose vehicles. I'm sure you've dealt dealt with these, But Natasha Mascarenas over at the, information has, a breakdown of what's going on. So let's read through that.
Speaker 1:This is, I think, slide three now. Yeah. There we go. SPVs are circling robotics startups $40,000,000,000 value valuation funding round. Special purpose vehicles are now a mainstay in venture capital, showing up in some of the biggest deals in artificial intelligence from OpenAI to Anthropic as a flexible way to raise cash from a larger pool of investors.
Speaker 2:And to be clear, not always a larger pool. Like, some of these big, you know, Thrive Capital will do an SPV
Speaker 1:Yeah.
Speaker 2:But it might be for massive investors. Right? It's not always this massive pool of investors. In the case of FIGR, it seems like this is basically being marketed to retail.
Speaker 1:Oh, interesting. I didn't
Speaker 2:know that. Actually marketed mark, marketed to retail, but more so
Speaker 1:more broadly.
Speaker 2:Hey. We got a $200,000,000 allocation. Like, we're gonna bring in, you know, 50 people to fulfill it.
Speaker 1:Can you steel man why a fund that has, you know, 3,000,000,000 under management in an active growth fund would wanna do an SPV when a company one of their growth stage portfolio companies is raising $20,000,000,000.
Speaker 2:There there's a bunch of incentives to do SPVs. One, maybe you don't wanna be over concentrated in a single fund. So if you're already sit if you're a growth fund and you have 10% of your investable capital already in that Yep. Company, it it it's more and more risk to go further. I think Founders Fund gets very aggressive with this and that there's more comfort being, like, we have 15% of our fund in this one company.
Speaker 2:But found a concentrated
Speaker 1:on SPVs as well.
Speaker 2:Yeah. Yeah. But they'll still do SPVs.
Speaker 1:Go back to the LPs. The
Speaker 2:other reason
Speaker 1:Hey. We you're already committed to this. You have allocation. But if you want more, you you can get
Speaker 2:more access because this fund is
Speaker 1:this this round is so big, we just can't fill it all.
Speaker 2:And one of the reasons why investors love SPVs, even if you're operating a a large, vehicle already, is that the SPV is deal by deal. Yep. So if your fund has, you know, 6% IRR Yep. And you're getting, you know, some carry on that and your fees, but then one SPV does a 10 x, you're getting the full benefit of that. Yep.
Speaker 2:All of the carry all of the 20% carry from that
Speaker 1:Yep.
Speaker 2:Even if your fund, you know, underperforms or doesn't achieve the the the milestones that you initially set. So Yeah. There's a lot of reasons.
Speaker 1:Way to get allocation from, like, lower tier or maybe people outside of Silicon Valley into SpaceX or Android.
Speaker 2:There's been a lot of SP. And there's and and this is why this is why AngelList has caught flack historically, although it's a fantastic platform and, like, I'm a weekly active user.
Speaker 1:Yeah.
Speaker 2:The but but there's managers on there that are and people that have gotten tremendously wealthy from having one good investment and, like, 30, you know, losers, basically. And so there's it it it can end up being over, over aligned to the to the, manager of the SPV. Yeah. And the same thing happens in real estate. It happens in every sort of asset class.
Speaker 1:Where there's a promote. Yeah. I there's a funny post. Maybe Will posted this, something about, you know, there's more in common with an SPV promoter and a, like, a club promoter than
Speaker 2:Yeah.
Speaker 1:Than, you know, traditional venture capital. I'll I'll read some of this, and then, I'm gonna get your your take. Now fund managers are considering using SPVs to fund a huge new round for FigureAI, the three year old startup that builds humanoid robots. The Sunnyvale based the Sunnyvale, California based startup is in talks to raise 1,000,000,000 to 2,000,000,000 and is seeking a $40,000,000,000 valuation according to three people with direct knowledge of funding fundraising efforts. The company has received a term sheet at that valuation according to one of the one of the one of the people interviewed.
Speaker 1:Align Ventures, a New York based early stage venture firm that invested in several figures several figures prior rounds has talked to investors about raising an SPV of several hundred million dollars from its limited partners and other investors according to two people. Parkway Venture Capital, an early stage deep tech firm that previously invested in FIGURE, also plans to invest in the round according to people. What do you think?
Speaker 2:So, yeah, the the whole thing, they have a term sheet here. Term sheets, the person, sending the term sheet determines sort of the the the entity behind the term sheet determines the weight that other investors put on the term sheet. Right? So Andreessen Horowitz sending a term sheet is very different than
Speaker 1:Yep.
Speaker 2:A $30,000,000 seed fund that, you know, nobody's heard of before sending a term sheet. Right? Yeah.
Speaker 1:And terms are not legally binding.
Speaker 2:Yeah. They're not they're not legally binding. They're, in this case, could very well be strategically
Speaker 1:Yep.
Speaker 2:You know, sent in order to, you know, one. The other thing is these I believe we know Parkway, and I believe that Align is in the same boat. I'm trying to check. So, like, Align Ventures for context
Speaker 1:Yeah.
Speaker 2:Their entire portfolio on their website is CPG companies. So they've done Billy, Careof, Codery, the farmer's dog, figs. So when traditional institutional venture capitals look at, you know, hearing that figure got a term sheet.
Speaker 1:Yeah.
Speaker 2:And then they go to the fund's portfolio and they're like, wait. This company has never doesn't have a public deep tech investment. That term sheet the reason that this round has been memed a little bit is because
Speaker 1:Yeah.
Speaker 2:It's hard to take a term sheet from from, a line super seriously. It's unclear that they would be able to pull together the capital Yep. To do, 300,000,000, much less a billion dollar investment. Right? Yeah.
Speaker 2:It is. Even if they're super excited about it. So, Parkway I'm pulling up Parkway Venture Capital as well. Yeah. I it sounds like they were in figure already.
Speaker 2:And so the other thing is that Parkway, if they have a big position in in in figures even last round, they have a huge incentive to mark up their position and just get more capital
Speaker 1:Yep.
Speaker 2:Into the company. The other thing, if Brett is hyperfixated on valuation, which around like this tends to mean. Right? There's no real there's no real reason that this is a $40,000,000,000 company. You know, you could argue that that doing one on 10,000,000,000 would still be a little bit too hot given their traction.
Speaker 2:Right? They haven't released a lot, but Parkway still has an incentive to to tell their, initial investors, look, you got a 20 x on your investment in in however many months. Let's do that. There's so much heat. Brett also has, you know, a a SPAC that's doing well Yep.
Speaker 2:Right now in the public markets. And so, maybe they're saying there's some floor to Brett, the adcox. Yeah. Yeah. Sort of, you know, deep tech machine.
Speaker 1:Yeah. I mean, the guys started, you you know, fundraising and Yeah. Keeping the share price up and delivering
Speaker 2:the The thing that we The shareholder promises. We talked about this. I think it was off there. I'm I'm curious what Adcox game plan is because it does feel like in the environment right now, figure could SPAC.
Speaker 1:Yep.
Speaker 2:But it certainly wouldn't go out at 40. And if it did, maybe it could go out at 40, but I don't think that's a price that it would be able to sustain. And so what is Yeah. It's what is the goal?
Speaker 1:Because it's not like the the valuation would not be driven by their Fundamentance. Earnings per share,
Speaker 2:beats or whatever.
Speaker 1:It says
Speaker 2:And Archer's still Archer's lost, you know, burned almost half a billion last year.
Speaker 1:Yeah.
Speaker 2:And so there's been, you know, there had been concerns of of sort of how long can they keep that up spending a million dollars a day with no revenue.
Speaker 1:A million dollars a day. Wow.
Speaker 2:More than a million dollars a day. Yeah. That's a lot. Yeah. And I mean,
Speaker 1:the steel man here
Speaker 2:for Like, the revenue the revenue line on public for Archer is a dash. Like, there is no There's no revenue.
Speaker 1:There's no revenue. Just r and d right now. And and and Brett would say, hey. Look. You know, how long did it take Tesla to start making real money?
Speaker 1:Took a long time. Right? Yeah. I don't know how Archer tracks against that timeline perfectly. But
Speaker 2:Yeah. And to be clear, we love robots. Yep. I wanna I wanna have, an army of of robot, podcast, you know, producers that Ben controls. You know, we got 50 different camera angles.
Speaker 2:Everybody should should want, figure to win, but it's totally fair to have a few questions about
Speaker 1:Exactly.
Speaker 2:Why is it getting priced more than Ford Motors? It's crazy. Why is it getting priced four times Rivian?
Speaker 1:Yep.
Speaker 2:Right? When you actually think about
Speaker 1:where the the top Andoril.
Speaker 2:Why is it yeah. Almost double Andoril. It's kinda crazy. Has a billion dollars of revenue.
Speaker 1:They just took a $22,000,000,000
Speaker 2:And some of the best
Speaker 1:from Ives.
Speaker 2:Yeah. And some of the best fundraisers Yeah. Ever. Right? So, look, it's hard for me to
Speaker 1:see tier one VC in the valley. Yeah. But there is an interesting question. Like, you know, Align Ventures, people are saying Parkway Venture Capital. These are not typical, like, huge growth stage deep tech funds.
Speaker 1:But there's there's I think there's an interesting idea of, like, why did this round come together the way it did. Well, think about the other funds that might do a deal like this and think about their conflicts. Yeah. Are they in an Elon company? Because Elon's working on humanoids.
Speaker 1:And if you're in if you're in X, like Andreessen is, or you're in, you know, Sequoia's in X, if you're in SpaceX, if you're in Neuralink, boring company Yeah. And you say, hey, Elon. We're gonna go and fund a direct competitor, the Tesla optimist. Even if your venture fund is not a Tesla shareholder, Elon might Yeah. Say, hey.
Speaker 1:What what what? Like, come on. Like, I thought we were on the same team here. Yeah. I'm building the Elon companies, and you're in one of those Elon companies.
Speaker 1:You benefit from everything that I do. Why are you finding a competitor of mine? And so, I I I I think it's interesting. Like, it is it is it is, like, very impressive that Brett has been able to put together as much money as he had competing with Elon. Yeah.
Speaker 1:Because, like, the famous quote is, like, never bet against Elon. Yep. And Elon said, hey. I'm doing the humanoid robot thing. Oh, add typically means Yeah.
Speaker 1:You don't wanna be the guy who's doing who's going up against Elon.
Speaker 2:What what what Brett is doing is is very impressive. Yeah. Anybody like, he's gonna have detractors. Anytime you have somebody rock it to this level of success, he's gonna have detractors. There's ways that you can, you know, try to dissect what he's doing.
Speaker 2:You know? And and, you know, the Parkway, the GP over at Parkway, who's presumably the one that sent the term sheet
Speaker 1:Yep.
Speaker 2:Has been on the board of figures since, May of twenty twenty three. So, you know, if he's, it it all comes down to again, until the round closes, it's all marketing Yep. As far as I'm concerned. And we saw this
Speaker 1:It's like Stargate.
Speaker 2:We saw this with, yeah, Stargate. We also saw this with, the the Bolt, Ryan Breslow
Speaker 1:Yep.
Speaker 2:When he came out and he said, I have, you know, new investment coming in and then people the thing is is it it's it's hard to fake a billion dollar investment because, you know, I've raised SPVs before. I don't know if you've done SPVs. Yep. It's hard to fill a, you know and and, like, filling a $400,000,000 investment, I don't believe that I actually don't believe that, you know, major New York City investment banks would be able to fill a $300,000,000 SPV into figure at 40,000,000,000.
Speaker 1:That's IPO money.
Speaker 2:Yeah. They wouldn't they wouldn't be able to fill that at $40,000,000,000. Yeah. I bet you they could at 5.
Speaker 1:Yeah. Probably.
Speaker 2:But but, you know, saying that That's
Speaker 1:a very good point.
Speaker 2:And so and so Jesse over at Parkway would love would love to talk to him and and kind of hear his plans for this. If he has some, you know, ridiculous capital network that is more risk on than some of the, like Yeah. Than than I see what you're saying. So
Speaker 1:It's good.
Speaker 2:Anyway, so so there's a lot of questions here
Speaker 1:Yeah.
Speaker 2:That I think are fair. I'm I'm ex you know, I'm I'm always in favor of high risk investments into deep tech. Yeah. But,
Speaker 1:this is yeah. I mean, this is kind of you know, if a VC is making an investment that doesn't make you uncomfortable, like, are they really doing venture capital? Yeah. Like This
Speaker 2:is this is adventure capital
Speaker 1:for sure. Feels like a venture bet
Speaker 2:Yeah.
Speaker 1:Where it's like, if it works, the bet is that he's going
Speaker 2:to beat
Speaker 1:Elon Musk and then deliver humanoid robots an entirely new technology that will scale to millions of these robots. Like, it will be a trillion dollar
Speaker 2:company if it works. The the the the thing is is it would still be a high high risk venture bet at $10,000,000,000. Right? Because you say, like, look, you know, this this company is gonna take
Speaker 1:Yeah.
Speaker 2:You know, with with Rivian, a really like, Rivian Rivian to me is a, like, fairly decent comp Yeah. And that it's
Speaker 1:a Competing with Elon?
Speaker 2:A competing with Elon
Speaker 1:Hard tech.
Speaker 2:Hard tech, you know, manufacturing intensive Yep. Low margin. Right? Like, everybody's like, you have to realize that Red is competing with Unitree
Speaker 1:Yeah.
Speaker 2:Which is a a Chinese company
Speaker 1:Yeah.
Speaker 2:Which we've known we've talked about this before. Other Chinese companies have shown we will sell a product at a loss for as long as it takes to own this market. Yeah. So is Brett gonna have margin Yep. When I and and so there's there's a lot of
Speaker 1:Even even though this is clearly, like, the most futuristic technologies, this is what we've literally seen in sci fi movies Yeah.
Speaker 2:Well, the other the other thing It
Speaker 1:doesn't necessarily mean that there's a network effect and high margins. Right? Those two things can be separate. We can get something that's an incredible, amazing, clearly worth the future, and it's, like, from straight out of sci fi, and it can be a mediocre business.
Speaker 2:Yeah. And then and then there's the whole other side of this, which is our bipedal robots, even the robot form factor that is going to dominate. Right? Is it gonna dominate the factory floor? Factory floors are flat.
Speaker 2:Right? We talked about this. Would it make more sense to have a, you know, robot that is attached to a wire so it's powered, can roll on wheels, and it can lift extremely heavy things? Yeah.
Speaker 1:Right? There's the founder of Boston Dynamics looking at this. Yeah. Just like, I've been grinding on this for twenty years. I built so much stuff, and I've never been able to really, like, pop the stock in a meaningful way.
Speaker 1:Like, I got Yeah. So you got bought by
Speaker 2:a hundred dollars,
Speaker 1:and then I got bought by Google, and I got traded around. And, like, my baby
Speaker 2:has just
Speaker 1:never had its day in the sun. And, you know He's not Brett. Yeah. He's So I was just an incredible technologist. You're not that
Speaker 2:guy, pal.
Speaker 1:You're not that guy. Literally. Because the Boston Dynamics demos, like, they're clearly on the cutting edge. They're state of the art. They're frontier.
Speaker 2:One thing I one thing I do believe.
Speaker 1:Yeah. Yeah.
Speaker 2:Brett's very good at fundraising. Yep. Very good at recruiting. Very good at building hype at
Speaker 1:Deals guy. He's good at puzzling together. Oh, we got the campus. Oh, we got the BMW partnership. Oh, we got the money, then we'll get another deal.
Speaker 1:Then we'll get a thing. Then we'll hire some people.
Speaker 2:If we had conviction that figure was going to, you know, there's this whole thing which is, you know, figure could argue in a TAM slide. Our TAM is not the value of the robots Yep. That we're selling at retail price or in these big enterprise deals. Our TAM is the labor force that we're gonna provide and the ongoing earnings when we displace every factory worker in the world or every agricultural worker in the world. Yeah.
Speaker 2:Right? So so there is an art like, he can go out and make a case for how Yeah. The TAM for this is $5,000,000,000,000, and it's very, you know, investing now.
Speaker 1:I think from that Dwarkesh, Satya podcast, it was, the global economy is a hundred trillion, and labor is something like 60% of that. Yeah. So you're looking at a $60,000,000,000,000 market.
Speaker 2:Yeah.
Speaker 1:And it's like, yeah. We're gonna take, you know, 2% of that.
Speaker 2:It's great.
Speaker 1:Trillion dollar business.
Speaker 2:So they're giving away the shares at four
Speaker 1:They are giving they should. Let let's rip through some of this just to give the the folks some extra data. There's a massive up round 15 times the last valuation, which was 2,600,000,000.0. Normally, I feel like when you get into the 2,500,000,000.0 range, the next round's at 5,000,000,000. You don't really see that many 10 x out of rounds.
Speaker 2:Four x.
Speaker 1:Four x. Four x is, like, it's pretty
Speaker 2:normal to go from the Yeah. Two and a half to
Speaker 1:and that was just a year ago. Jaw dropping jump even in this market. Figures investors may ultimately back the company. They could always just jump the line and go direct. The startup hasn't approved any SPVs and has asked its existing investors to invest, from their own funds because they might wanna put in more money if they're not having to pay fees.
Speaker 1:Right? Bloomberg first reported on Figurs AI's target valuation. It's true that investors are excited about a new generation of robotics startups. There's a lot of these field AI as a maker of AI models to control robots that's targeting a $2,000,000,000 valuation. They're raising Yeah.
Speaker 2:And we saw, Locky's company Yeah. And is Daniel Groot no. No. He's he's part of There's part of the other one.
Speaker 1:It's called, like, General Intelligence or something.
Speaker 2:That's that's that. Yeah. There's a lot of generic No. And and the the the the argument for why Figurs valuation could be nearly two x Anduril's is that Anduril, if they wanted to raise from a hodgepodge group of random SPVs, they could do it at 60. I
Speaker 1:mean Yeah. Yeah. I mean, they they they've they've talked about the oversubscribed nature of these rounds, and they could probably pump that up.
Speaker 2:But Yeah. Anduril with IVAS at $28,000,000,000 feels like they could raise from less sophisticated institutional investors at a almost doubled themselves.
Speaker 1:Imagine how much they could get if they went to China. Yeah. Imagine they're just like, actually we only care about evaluation.
Speaker 2:The final frontier.
Speaker 1:The mission doesn't matter anymore. Yeah. Let's just rip, you know, get some get some crazy money in here. So, they on Thursday, Figure AI unveiled Helix, a model developed internally that enables robots to perform more complicated tasks. There was this video demo, very cool.
Speaker 1:They partner with OpenAI so you can talk to it and they're using, like the speech recognition and the and the chat GPT stuff to kind of act as interface to the instruction set. It's already raised $745,000,000 from investors including Microsoft, OpenAI, and NVIDIA. Real murderers row of corporates and strategics, which I think is really really good at doing. And it has big plans. They've hired more than 200 people for an engineering and AI hardware team.
Speaker 1:According to documents created by an SPV manager, the company is projecting it will build up to a hundred thousand robots over the next four years according to the same materials and two, and two of the people. The company secured BMW as a first customer. None of those plans explain why investors think the company is worth 40,000,000,000 for context.
Speaker 2:Yeah. And and to give some context, if they're selling these robots at a hundred thousand dollars a pop, which feels low given that's generally the price point that Unitree sells at. You can go buy Unitree robot for around 6 figures. That's $10,000,000,000 of revenue. Yeah.
Speaker 2:So so so if Brett is saying, I want you to give me a four you know, I want you to basically give me a five x four x on my Forward revenue. On my $20.29 forward revenue. It still feels crazy.
Speaker 1:It is crazy because so so that revenue multiple of, like, 60 x revenue or 40 x revenue, that's not crazy in AI. Like, Anthropic is raising 40, at 58,000,000,000, but they have a billion in ARR. Yeah. And so but it's now. Like, they have that ARR now.
Speaker 1:And so And the other thing from a pricing
Speaker 2:standpoint is didn't Satya buy half of OpenAI for, like, 10,000,000,000? Like, not even Yeah.
Speaker 1:I don't know. No. I don't think half, but certainly, like, a third or something like that. And so, let's go to some reactions on the timeline to break this down. We got Luke Metro over at Anduril.
Speaker 1:He says, Brett Adcock is shaping up to be the best fundraiser since Adam Newman, Amazon.com. And this is from back in 2024 in February a year ago, almost a year ago today. Amazon.com founder Jeff Bezos, Nvidia, and other big technology names are investing in startup figure AI that builds human like robots. Bloomberg News reported Friday citing people with knowledge. They're backed by OpenAI and Microsoft.
Speaker 1:Samah can win when he gets 7,000,000,000,000. And so people have been talking about Brett Adcock's amazing fundraising abilities for a long time. You had a post about it, which is in here. It took the Ford Motor Company a hundred and fifteen years to reach a $40,000,000,000 market cap. Brett Adcock did it in just three years with Figur.
Speaker 1:Can we finally stop glazing Henry Ford now?
Speaker 2:Senra Senra probably saw this. And if you didn't know that I was joking, he probably had an aneurysm.
Speaker 1:Yeah, of course.
Speaker 2:Do not disrespect Henry Ford. I was obviously joking here.
Speaker 1:Yeah. The markets are crazy.
Speaker 2:I think they both deserve respect.
Speaker 1:Yep. But but but the the title of, you know, Henry Ford is like a historic entrepreneurial GOAT. Right? One of the greatest to ever do it. And Brett
Speaker 2:could be that guy.
Speaker 1:Brett could. It's just too early.
Speaker 2:He's got, like, 20
Speaker 1:Right now, he's NBA prospect, potential rookie of the year if he can start delivering these robots, but his jersey is not going up in the rafters unless unless the clack cash flow gets there to back it up.
Speaker 2:I I just think at this point, like, believability matters so much.
Speaker 1:I agree.
Speaker 2:Right? Like, when Humane came out and they said this is the future computing platform Yeah. Nobody believed them. Yeah. When Figur goes out and says we're we believe we're worth $40,000,000,000, and that's where we wanna take new capital.
Speaker 2:Nobody believes it. And it's such a and, again, I just think you could have raised a three x up round. Totally. And, you know, everybody, like, probably
Speaker 1:At a $5,000,000,000 valuation with with, like, scrappy engineers, little bit more, like, you know, hey. We're just focused on engineering, building. We're sharing even more. The vibes could be way, way better. Yeah.
Speaker 1:Right? But instead, it it it seems it it seems like frothiness as a brand. Right? And that's odd. So Shiel Monot says, figure humanoid robots reportedly raising at 39,500,000,000.0.
Speaker 1:So it's not 40. Give me a break, Jordy. He's not raising
Speaker 2:at 40.
Speaker 1:He's raising at 39.5.
Speaker 2:Yeah.
Speaker 1:K? Scheele says frothy.
Speaker 2:I wonder if they chose it to be slightly less than that so that it feels like there's some science Yeah. Based reason. Like, they they ran they put it in a spreadsheet and they popped out. This is the numb this is the right number.
Speaker 1:One time I was negotiating with VC early on in my career, and he's like, oh, yeah. Like, we I I put my whole team on this. They built a whole bunch of models, and they came back with, like, valuation for the company is, like, you know, hundred and $50,000,000. Like, can't can't do any better than that. And I was just like, that you clearly didn't do any math.
Speaker 1:Like like, you because, like, you would've you would've given me, like, a not round number. Yeah. Yeah. Yeah. Yeah.
Speaker 1:Clearly just ballpark this because Yeah. Yeah. Yeah. That ballpark me, bro. Yeah.
Speaker 1:Like, the spreadsheet said, like, one thirty seven million point two four. And so I rounded that to one thirty eight, and that's what we're doing. Yeah. Instead, it was just like, no. You didn't.
Speaker 1:You didn't do this at all. Yeah. So, yeah, if you're raising folks, don't try and raise it a hundred million. Raise it $99.99. Yep.
Speaker 1:For a limited time only.
Speaker 2:For a limited time only.
Speaker 1:Tell your tell your 20% off. Three easy payments. Three Three easy payments on the $20,000,000 series a. Sequoia used to do this for YouTube, I believe. They did a tranche investment.
Speaker 1:Three easy payments of of of $10,000,000
Speaker 2:each. And then it turns out as a founder, you really don't wanna take tranched investments because you're sort of having to operate based on the
Speaker 1:Oh, yeah.
Speaker 2:Getting the money. But then if it doesn't come through
Speaker 1:Then you're
Speaker 2:There's so many reasons that the VC could change their mind. Yeah. Every every private markets investor has made an investment at some point, or active ones at least, where they get the first update and they're just like, like, I I messed up.
Speaker 1:And so base Baron has a quote in here. He says, if Brett Adcock can raise money still, so can you never kill yourself. Very funny. Having some fun on the timeline. Having some fun.
Speaker 1:But, you know, I went through Brett's, Brett's post and he's got some bangers in here. That's a banger. Post. He says, I've raised almost $1,700,000,000 from cold emails from my companies. I've tracked performance of cold emails versus referrals, and cold emails consistently outperformed by a long shot for a few reasons.
Speaker 1:Sharing mine, this is converting at 70% email to meeting. Hi. My name is Brett Adcock. I'm the founder and CEO of Figma.
Speaker 2:See the precision here? 70.8%.
Speaker 1:Yeah. He's a business guy.
Speaker 2:Specific.
Speaker 1:There's something to this. I I think you're I think you're on to it. Prior to this, I founded Archer Aviation, electric VTOL aircraft company, NYSE Archer, and also founder of Vettery, sold for a hundred million dollars. Do you have time for a call? I mean, yeah.
Speaker 1:You're you're you're, I mean, there's a lot to like about this structure in the sense that just two sentences, very clear. He presents, what's he doing now? Why is he calling you? And what has he done in the past Yep. Very concisely.
Speaker 1:And so even if you're someone newer in your career, you could easily say, prior to this, I built a startup, raised a million dollars, and studied engineering at this school. Do you have time for a call? That's way better than chat GPT, paragraphs, like, all that junk. And so yeah. Obviously, if you didn't sell a company for a hundred million dollars, probably gonna have a lower conversion rate here.
Speaker 1:But you can still adopt a lot of this, which I thought which I thought was cool. He had another crossover with a good friend of the pod, Theo. Did you see this one?
Speaker 2:Wait. Did I miss the, did we miss the the Ben the Ben follow-up there? Oh, yeah. It's really good.
Speaker 1:Do you know Ben?
Speaker 2:Ben, another friend of the pod, says tried it, doesn't work, and he sends an email from him, Ben, saying, Jim, my name is Brett Adcock, and I'm the founder CEO of Figured, an AI robotics company building a general, and then Jim responds, you are not Brett Adcock. Your profile clearly says that your name is Ben. Please remove me from your mailing list immediately. So having some more fun, on the timeline. And then we got Theo.
Speaker 1:Yep. Theo is in the game, cross over the century. He says company ideas are worthless. Execution is king. This is from Brett Adcock, posting some wisdom on the timeline.
Speaker 1:He says, in the limit, the pace of technological progress is the only competitive advantage. How to stop overthinking strategy and execute, like, the top 1%. He drops a thread. He's been a bit of a thread boy throughout 2023, '20 '20 '4.
Speaker 2:Yep.
Speaker 1:But he grind he grinded his his whole account way up. And now whenever he whenever he posts a new robotics video, instant virality. And, I'm sure he had a great great team working on this with empower. Kyle Kasheov says, hey, John h. Theo.
Speaker 1:This is your bit. And Theo says some interesting ideas he's got there because Theo was all on the ideas guy train for a while, and, you know, he's trying to he's trying to coin it. The problem is, Theo, you didn't coin a phrase. Yep. You didn't really get breaks out of
Speaker 2:that concept. Yeah.
Speaker 1:Yeah. Idea guy was that was a phrase before Theo. Theo was doing some really great foundational work on on what The value. The value of being an ideas guy was. He kinda
Speaker 2:he coined business magic. Magic is real.
Speaker 1:Okay. Like, he
Speaker 2:he did a good job of that with with Invest Like the Best. Yeah. I liked his episode there.
Speaker 1:He's just gotta go a little bit deeper into it and really push, I think. But he'll get there.
Speaker 2:Let's see what Apple intelligence thinks.
Speaker 1:Yeah. So, this is a great way to close out. Brett, obviously, working extremely hard. He needs rest. He's been using an Eight Sleep temperature controlled mattress the last two nights, seeing 40% plus in my REM SWS hours.
Speaker 1:Stephen Burkholder says, keep us posted in the long term. And Mateo from Eight Sleep chimes in and says, in the meanwhile, check out a thousand reviews about us here. And that takes us to our first promoted post from Eight Sleep.
Speaker 2:Boom. That was smooth, John. Smooth. That was good.
Speaker 1:He the the founder we're talking about is sleeping on Eight Sleep. It's an Eight Sleep bad. Let's go. But we have an update. Somebody in the chat yesterday was asking, Jordy was wearing an Eight Sleep hat.
Speaker 1:Can you get an Eight Sleep hat? And, yes, you can. They don't just throw them into every order. But if you order with our code and send it to us, we'll send it to you.
Speaker 2:Screenshot of the order.
Speaker 1:Of the order. It's code make sure that the t b p n, I think. Or Yeah. And, if you order an Eight Sleep, they will send you a hat if you order through our code. So have fun with sleep.
Speaker 1:The screenshot. And, yeah. What's your what's your sleep score at today? Which I've
Speaker 2:been putting up crazy numbers. Crazy numbers? I've been putting up crazy numbers.
Speaker 1:See what I'm at.
Speaker 2:I got a 98 last night.
Speaker 1:98.
Speaker 2:My routine
Speaker 1:was not good. 62%. But I did put up seven hours and ten minutes. Pretty good. Pretty happy with that.
Speaker 2:I'm gonna yeah.
Speaker 1:Quality was a %.
Speaker 2:My feeling good. This week, my average bedtime was 08:46. My average wake up was 04:54.
Speaker 1:You send me texts being, like, I'm going to bed for the night at, like, eight. It's great.
Speaker 2:Yeah. And you're, like, stop texting. I try to turn off my phone.
Speaker 1:It's good. Yeah. It's key. Getting to bed early makes it so easy to wake up early. That that's the whole secret.
Speaker 1:It's not more alarms. It's just get to bed early. Fall asleep quickly. And that's what the Eight Sleep helps you do.
Speaker 2:Yeah. I don't the the other thing with the Eight Sleep is, like, to me, the best like, the the functionality that I genuinely love the most because Mhmm. Living in Malibu every single night, the temperature drops.
Speaker 1:Oh, yeah.
Speaker 2:It's it's not too cold. It's not too hot. It's just nice. But the feature that I actually love, and I feel a little bit soft for saying this, is the way that it warms your bed
Speaker 1:Oh, yeah.
Speaker 2:As you're as you're waking up. It makes it so easy to get out of bed because I'm already warm. The worst is you wake up, you're cold. Totally.
Speaker 1:And you wanna stay in.
Speaker 2:And you wanna stay in bed. I don't wanna stay in. I'm ready to go.
Speaker 1:Yeah. Well, you know another way to jolt yourself out of bed, Jordy?
Speaker 2:With with
Speaker 1:a cold Celsius or Alana Alani Nu. Alani Nu. Takes us to our next story, banger acquisition.
Speaker 2:Where's the gong, John?
Speaker 1:Yeah. We need a bunch of gong hits for the $1,000,000,000 hack. I don't know if we can bring size one for that, but it is big. The $40,000,000,000 fundraise from figure and the $2,000,000,000 acquisition from Celsius of Alani Nu.
Speaker 2:It's Friday.
Speaker 1:Fascinating story. Very few CPG companies get bought for these big of numbers. I've operated in CPG. You've obviously know a lot of folks in CPG have have invested in companies and stuff, and so we're breaking it down. Celsius has agreed to purchase Alani Nu for 1,800,000,000.0.
Speaker 1:It's in the front page of the, Wall Street Journal business section today. So we'll read through a little bit of that. Celsius to acquire rival maker of energy drinks. Energy drink energy drink maker Celsius is paying 1,800,000,000.0 to buy rival Alani Nu, a brand that has been propelled by social media influencers and pitched itself as a local fitness aid. Celsius is expected to pay a combination of cash and stock, the com the company said.
Speaker 1:The deal, which includes a net purchase price of 1,650,000,000.00 and a hundred and 50,000,000 in tax assets, is Celsius' largest acquisition since it was founded two decades ago. And I'd love for you to pull up on public.com what is the Celsius stock doing, around this acquisition, because I wanna know what does the market think about this. Celsius had a market value of roughly 6,000,000,000 after its shares closed down 2.15%, at $25 a share on Thursday. Overall, energy drink sales have been climbing, but Celsius' growth has slowed over the past year. Celsius is a very, very hot stock.
Speaker 1:I think it was up in, like, the 20,000,000,000 market cap, and it's since fallen a little bit. Little bit of background on Alani Nu.
Speaker 2:Yeah. So Celsius for context is down 36% in the last six months.
Speaker 1:Yep.
Speaker 2:So they had
Speaker 1:And that was because growth was slowing. People were thinking, oh, this is gonna dominate. It's gonna beat Red Bull and Monster. It's kind of a new category for the fitness oriented folks, the healthier folks.
Speaker 2:Yes. But
Speaker 1:they're not really putting a dent in the Monster drinkers.
Speaker 2:This time last year, they were a 20,000,000,000 company. Yeah. They're way down.
Speaker 1:20,000,000,000. Wow.
Speaker 2:Yeah. Way down at 6%. Yep. And it seems that once you get to true scale as an energy drink, they're just fantastic.
Speaker 1:Fantastic businesses. Totally.
Speaker 2:Monster's still sitting at $40,000,000,000.
Speaker 1:Yeah. Red Bulls. Private house.
Speaker 2:But In
Speaker 1:the tens of billions for sure. Yep. Yep. And so, Alani Nu was started in 2018 by fitness influencer Katie Hearn.
Speaker 2:Monster is getting a 25 x EBITDA multiple
Speaker 1:Yeah.
Speaker 2:In the public.
Speaker 1:And they also bought Bang Energy out of bankruptcy for, like, one x sales around a billion dollars. Yeah. So they picked up that asset as well. And so, there's just a bunch of huge players now. It's Celsius, Monster, and Red Bull.
Speaker 1:But there's obviously a lot of other, Ghost Energy is doing a bunch of big deals. There's a lot of energy drinks going out. And I I love them. I drink Celsius pretty much every every show now. And we're big, Guayaqui fans.
Speaker 1:We're big fans of Yerba Mate. Huberman's in the game. He's got a Yerba Mate product that I personally like a lot. And, yeah, low calorie, high caffeine, kicks you in the face, gets you out of bed. You're not gonna be in your eight sleep all day when you got That's
Speaker 2:for sure.
Speaker 1:When you when you're replacing your blood with Celsius. Anyway, so Alani Nu sells, energy drinks, supplements, and protein drinks. The Louisville, Kentucky company has built its brand largely through partnerships with influencers like Kim Kardashian, Paris Hilton, and Addison Rae. So they got heavy hitters. So I'll see its markets, its sugar free caffeinated drinks as a healthy alternative to full sugar energy drinks and sodas and claims its products can help burn body fat, which is a claim that you can make if you have more than a hundred grams of caffeine.
Speaker 1:And it's a structure and function claim, not a, not a medical claim. So you're not regulated as a drug. You're regulated as a nutritional supplement at that point. Which is wild. So Drew Fallon had a great breakdown.
Speaker 1:We'll pull up this, this little thread he posted. He says, the the latest deal in an absolutely scorching hot energy drink market, let's break down the deal. Celsius has had an extraordinary run over the last decade, particularly with a huge run up in 2023. However, growth slowed in q four twenty twenty four. Revenues were about the same level as q two twenty twenty three.
Speaker 1:The stock had been priced to perfection, so it's drawn down about 60% in the last year. Alani knew was I don't
Speaker 2:know about perfection if it's down
Speaker 1:if it's down. It was priced for perfection. Like, like, at $20,000,000,000 continued. They were like yeah. The market was pricing like Yeah.
Speaker 1:They're gonna beat Red Bull. They're gonna beat Monster. It's gonna be everywhere. Celsius is the next amazing perfect thing. And, of course, they couldn't live up to that.
Speaker 1:And so it, the the stock has since drawn down. So Alani Nu did around $600,000,000 in sales with 70,000,000 in net income in 2024, started in 2018. So six years later That's they're throwing off 70,000,000 in
Speaker 2:in net income. Narrative violation because so many beverage companies
Speaker 1:Yeah. And Never get a skip.
Speaker 2:Losing losing money through acquisition. Oh, yeah. Like, very, very common
Speaker 1:Totally.
Speaker 2:For these companies to just lose money, but they have market share, and they're eating away at these sort of bigger incumbents. Yep. And then eventually, they get bought. So
Speaker 1:it's been growing at 50% since 2022 with 50% repeat buyers. Celsius owns 11% of the energy drink market, almost 12%, but with slowing growth and the recent acquisition of Ghost Lifestyle by KDP, current Doctor Pepper. So Ghost is actually off the market as well. It became clear that they were not going to increase their market share organically. And I don't know if you've seen what Ghost is doing, but they have, like, Sour Patch Kids partnerships.
Speaker 1:They have partnerships. There's also, G Fuel, which is another independent company at this point, and, and Rain and Nas and Bang, and it's a crowded crowded market. And so Alani Nu, ranked as the fourth energy drink in terms of market share. Celsius paying a net value of 1,650,000,000.00. This is 2.8 x sales.
Speaker 1:Yeah. 26 x, TTM net income, $70,000,000 as we said. 20 x, adjusted EBITDA. Not crazy, but super but pretty high for CBG. Celsius is publishing 12 x fully synergized EBITDA as the purchase multiple here.
Speaker 1:That is obviously wishfully low. Yeah. Alani Nu was the last desirable and scaled asset in the energy space and perhaps the most desirable since the energy boom. Celsius paid up for this one. Adjusted fully synergized EBITDA feels eerily similar to Adam Newman's community adjusted EBITDA.
Speaker 1:So they're basically saying, like, look. We didn't overpay because once we get all the synergies, we're gonna be making way more. So you have to adjust the EBITDA now, and this is really how you should think about the multiple. But sounds like the market didn't love the deal and the stock traded down a couple percent. Is that right?
Speaker 2:Yeah. Let me pull it up over
Speaker 1:So, honestly, it seems like they kinda just added $50,000,000 to EBITDA. Hills here's Celsius' reconciliation. I'm putting the acquisition Well,
Speaker 2:to Celsius' credit
Speaker 1:20 x EBITDA range.
Speaker 2:They're up 45% over the past week.
Speaker 1:They're building that.
Speaker 2:Yeah. Okay. So overall, the response I don't know when this was posted, but
Speaker 1:This news broke yesterday, kinda yesterday morning in it.
Speaker 2:Yeah. And it's interesting. I mean, it does still seem, you know, Celsius has a hundred and 63,000,000 of TTM EBITDA.
Speaker 1:Yep.
Speaker 2:They have a 35 x multiple. Monster is at scale with a 25 x multiple. Yep. It does feel like they're priced somewhat fairly even at this mark. Right?
Speaker 1:Yeah. And so they had, what, a hundred and 60 of EBITDA? Is that right? Yeah. Celsius?
Speaker 1:So they just added 50 to that. So that's a 25 increase in their EBITDA Yeah. For a $1,600,000,000 acquisition at a $5,000,000,000 market cap. So it's kind of like a merger. But now
Speaker 2:I'm sure they had a ton of cash on the balance sheet prior.
Speaker 1:But now they control 16% of the energy drink market, and we'll give you some background on the long term tailwinds in energy. The category has been growing really, really quickly. $90,000,000,000 is the global energy drink market. 10% it's growing at 10% and is expected to grow 10% till the end of the decade. Increasing category adoption incrementality and 37%.
Speaker 2:Has that meme factor that Oh, yeah. ZYN does right now where people are just Yep. They they do the marketing for for Celsius. And so they kind of have that
Speaker 1:Yeah. Their blast and that's Yeah. If you wanna, like like, you know yeah. I I saw just yesterday, there was some, senator, I believe, who posted, like, I'm locked in. I got these bunch of Celsius, and I'm working late tonight.
Speaker 1:And Brian Johnson was there being like, don't drink a Celsius late at night. It'll drop
Speaker 2:after hundred milligrams kept.
Speaker 1:Exactly. Yeah. You saw that post. And so, sugar free is gaining in ready to drink energy. In 2020, the sugar free market was 39%.
Speaker 1:By 2024, it went to 51%. And it makes sense. Why would you want a bunch of sugar in your, energy drinks if you're chugging them? A lot of people, although you've been saying for a while sugar might be making a comeback, it's probably not gonna make a comeback in the form of high fructose corn syrup, but maybe the next wave. I I feel like the energy drink market will continue to turn over.
Speaker 1:There will continue to be new and trends.
Speaker 2:Actually one of the reasons I like these. We drink a lot of Matina from from Huberman, but these are just regular agave or
Speaker 1:There's agave. Agave syrup, which
Speaker 2:I'm cool with. I like the I like the boost.
Speaker 1:Yeah. It seems like the main thing you wanna stay away from is, like, the highly processed sugars. Yeah. And so you can go natural sugar or you can go sugar free. It kinda just depends on your diet and your your goals.
Speaker 1:And so this really provides a platform for for Celsius to go after and capture beverage trends in the category. Celsius markets its sugar free caffeinated drinks as a healthy alternative to full sugar energy drinks and sodas. Although, of course, Red Bull has a sugar free. Monster has that zero white one that everyone likes. And so, but there's still some value to being a brand that stands for sugar free, and that's the initial value prop as opposed to needing to get the diet Coke product of the, of the cat of the particular brand.
Speaker 1:Totally. And so Mads Capital says, the juice is back. He timed Celsius perfectly after hours and is now up bigly after they announced that they're buying Alani new. Jonah Lupton, I got backed in back into Celsius after hours at $24.50 once I saw they were buying Alani for 1.65, which is not only accretive, but Alani has a full suite of products from protein shakes to pre workout and much more. This is a very smart deal by Celsius.
Speaker 1:I think the CEO saved his job for now, and so people are excited about that. There's a little bit of, hate coming from Trevor Scott. I think this is funny. Celsius acquiring a Lonnie new, which is essentially the new Celsius, twelve x post synergies, 30 19 x pre synergies, including tax assets. Q four results better than expected.
Speaker 1:Revenue minus 4%. Adjusted EBITDA minus 4%. Celsius up 31%. Declining sales, what do you slap on it? A high growth acquisition.
Speaker 1:Maybe this isn't such a negative bear take. This is actually like, yeah. He kinda did what he had to do. You know? Yeah.
Speaker 1:You're you're you stop growing. Get the thing that's growing. Build the portfolio.
Speaker 2:Yeah. The challenge here is Celsius seems to resonate broadly with the market. Alani knew with the branding. I don't see I don't see Chad's picking that up.
Speaker 1:Yeah. It does seem like it's, like, almost like the female Celsius, which could be very valuable. You know? For a long time, I thought of Red Bull and Monster as as highly masculine products, especially monster. You know?
Speaker 1:It's monster trucks. It's a very hard rock stuff. You don't see a lot of girls walking around with monsters. Yeah. Red Bull is
Speaker 2:more gender neutral. Yeah.
Speaker 1:Red Bull is
Speaker 2:a little bit more. Vodka.
Speaker 1:Yeah. Red Bull vodka. And then also the, Celsius, I felt like was a little bit more gender neutral in the sense there was, like, CrossFit. But when you go to a CrossFit class, it's usually pretty broken down evenly by gender.
Speaker 2:Yeah.
Speaker 1:And so I could see that kinda happening the same thing. There's an interesting post here by the Bank of Bravos. Did you see this? Are you familiar with any of these, distribution networks? No.
Speaker 1:Okay. So
Speaker 2:Have you run into them? Yeah.
Speaker 1:Yeah. I've run into a bunch of these. The ABI network successfully scaled Monster, Bang, Celsius, and Alani Nu to significant levels. Energy drinks that enter the ABI network tend to scale well, but Pepsi often marks the final stop before growth dies. And so Interesting.
Speaker 1:Kirk Doctor Pepper, Pepsi, Coke, these guys have all these massive distributions. And typically, at the later stage of a consumer packaged goods, beverage company, you're gonna wanna do a deal with one of these guys, and they will put you in all of their stores. But then there's also, like, essentially, a deal that, hey, we if it works, we're gonna buy you.
Speaker 2:Yeah.
Speaker 1:But it can still be very valuable for all the shareholders, and everyone can be happy. So this is how the distribute distribution landscape has evolved in chronological order. The ABI network scaled, MNST. MNST moved from ABI to the Coke system. Bang transitioned to ABI.
Speaker 1:Bang then moved from ABI to the Pepsi system. Then there was this lawsuit with the, Bang and Pepsi. It was kind of a weird deal. But Celsius joined ABI, then Bang exited the Pepsi system. That was the lawsuit.
Speaker 1:Celsius moved from ABI to Pepsi. Alani Nu joined the ABI network. Alani Nu is likely to exit ABI for the Pepsi system with the upcoming Celsius acquisition, creating an opening in the ABI network once again. And so we gotta call Huberman and get, Matina into the ABI system because there's a gap there now. And and ABI is gonna want a new client, and they're gonna want a good deal.
Speaker 1:And I'm sure it's gonna be bid out, but whoever wins that, like, there's a reason why great companies keep going with ABI because that will yeah. And and and and and you have to pay. But it really is almost you can think of it like a value add investor. ABI is in in Heizer Busch InBev. Yeah.
Speaker 1:So they have, you know, like, everywhere you buy beer, which is just every single store, you get they have trucks with guys that go and deliver beer. Yeah. Right? And so there's no store in America that says, actually, I don't want Budweiser. Yeah.
Speaker 1:I'm good. I'm not yeah. No. They all want the trucks to come. And when the trucks come, they say, hey.
Speaker 1:What else you got? Oh, you got some Celsius? Yeah. I do have some people that want that. Yeah.
Speaker 1:I'll try that. And they can even push
Speaker 2:couple cases on.
Speaker 1:And they can even push and say, hey. Look. We're gonna sell you Budweiser. We're gonna give you a good margin on that. You'll be fine, but we want you to test this new thing.
Speaker 1:Yeah. Take the little things with us.
Speaker 2:Yeah.
Speaker 1:And you're gonna get a keystone margin, which is 50% on this new product. You're gonna get better margins than you do on on the commoditized, like, Budweiser product.
Speaker 2:Yeah.
Speaker 1:So you're gonna make good money on the stuff that you move. It's not gonna move as fast because people don't know Alani. People don't know Celsius yet. But, eventually, it's gonna scale and look at our track record. We did it with Bang.
Speaker 1:We did it with Celsius. We did it with Alani Nu. The next thing, though, when Anheuser Busch comes to the local store, people are gonna say, hey. Yeah. This is gonna be good for my business because you guys know what you're doing.
Speaker 1:You pick really well. And so Yep. If you're in, if you're in beverage, you'd gotta talk to a b I, Anheuser Busch in Bev. Anyway, if you're interested in, this deal, if you're interested in Celsius, if you're interested in tracking how these mergers affect the public markets, you gotta go to public.com. Investing for those who take it seriously, they have multi asset investing, industry leading yields, and is trusted by millions.
Speaker 1:You've seen Jordy pull up all the stats on public. They have a very cool alpha product that uses AI and chat GPT to pull in extra context. They have great charts. They have advanced charts, simple charts. It's a great product.
Speaker 1:So, that's where you should be looking for, everything related to, financial assets. And we have a post from the co CEO and founder, Leif, good buddy of ours. He says, he's posting a screenshot from the Wall Street Journal, treasury direct to bond buyers moving your money could take a year. There's a huge it's really, really hard because a lot of people went into treasury direct because they were like, I want these great yields when interest rates went up. Yeah.
Speaker 1:And now it's hard to get out just because it's a legacy government system. But with public, he says, luckily, you don't have to deal with this because we just revamped our treasury account. You deposit, earn yield, you build, we'll pick a ladder, and take your money out whenever you like. It was crazy it was
Speaker 2:a crazy moment when people were going to the TreasuryDirect website, and it felt like this DMV style interface. And so it was great that, you know, players like Publix came in and said, hey. We're gonna we're gonna, actually just make this really easy. Make it, you know, literally take whatever Yeah. Seconds to, you know, to access that yield.
Speaker 2:So
Speaker 1:Well, we got another amazing article about a storied automotive manufacturer, Ferrari. We're breaking it down. There's an article in the Wall Street Journal today, the wild economics behind Ferrari's domination of the luxury car market. We've talked about Ferrari before. A lot of weird decisions going on.
Speaker 1:Doesn't seem to be affecting them financially. We're gonna talk to someone who's owned a Ferrari on the part
Speaker 2:of the day. Part of
Speaker 1:We have Jordy Hayes here, former Ferrari owner, here to break it down for us. Jordy, I'll read you some of this.
Speaker 2:It's amazing with my experience that I still love the brand.
Speaker 1:Oh, yeah. And Yeah. Breaking down constantly and you're like, but it's still goated.
Speaker 2:It's goated.
Speaker 1:It's amazing.
Speaker 2:You gotta
Speaker 1:They own red. Like, what like, what more do you want?
Speaker 2:Just like the way that we own green Yeah. They own red.
Speaker 1:They own red. So with a list price of $3,700,000, Ferrari's new hypercar was revealed to the public in October with a twist. It wasn't available for sale. All 799 units of the low slung, high haunch f 80 model, the most expensive production vehicle in Ferrari's history, had already been promised to top customers like Luc Poirier. The Montreal Real Estate Entrepreneur already owns 42 Ferraris.
Speaker 1:He said he felt lucky to be allowed to buy yet another. To be chosen to buy Ferrari is for one of their hypercars is a true milestone for any collector. Yep. Money isn't enough to buy a top of the range Ferrari. You need to be in a long term relationship with the country with the company.
Speaker 1:By leveraging the rabid fandom of its customers through the business model based on Uber scarcity, The storied Italian company is enjoying a new golden age following an almost tenfold increase in the stock since its IPO a decade ago. Ferrari is now worth $90,000,000,000. That's two figures.
Speaker 2:Two figs.
Speaker 1:That's two figure AI robotics companies. You take two of them, you get a Ferrari, making it the most valuable car company in Europe despite delivering just 13,752 vehicles last year. So, Jordy, why don't you break down, what their strategy is with these, super restricted hypercars? How do you get one? Yep.
Speaker 1:You know, just break it down. Make it
Speaker 2:So, yeah, I I've talked about I don't think we've talked about this on the show that much. I I know I've talked about it before on x, but, Ferrari has this fantastic, business model that's similar to every other luxury brand that you'd be familiar with, Hermes, Rolex, Patek, all these different companies. They basically make, no matter how much money you have in the world, if you want to buy these cars, watches, bags, etcetera, directly from the manufacturer, directly from the brand, you have to play their game. Yeah. You know, every single, every single brand has a different version of their game.
Speaker 2:There's there's plenty you can look up online forums for every brand and see, you know, what game did you have to play. Yep. And the game is basically spending money on things that you don't necessarily want to get the thing that you actually want. Yep. So Ferrari and Porsche does this as well.
Speaker 2:Every brand gets knocked for this because people say, I have $300. I should be able to buy the GT three RS. Yep. And Porsche and and what people don't realize is they're using these hyper exclusive cars as top of top of funnel marketing for every other car in their portfolio or every other watch or every other bag or every other product that they make. Right?
Speaker 2:And so in the case of Ferrari, Ferrari, you know, has been playing this game for a very long time. It's been, you know, the most desirable cars in the world for a very long time. They typically are making under a thousand units of their most high profile, most desirable cars. Yep. And these are the cars that are actually investments.
Speaker 2:Yep. Every other car that they make, for the most part, depreciates massively. Right? Nobody wants a nobody wants a 15 year old Ferrari that was the entry model. Right?
Speaker 2:These cars end up trading at $30.40 grand. Like, you can actually pick them up Yep. For very little because they're unreliable and and they're not, you know, they have a March Honda.
Speaker 1:It's, like, fairly accessible. Probably still almost a hundred k.
Speaker 2:Probably around there.
Speaker 1:But it's, like, a 20 year old car at this point, and it's it was it was an entry model at the
Speaker 2:time. And so yeah. And so so, ultimately, you if you wanna eventually buy Ferrari hypercars, you have to go in there, and you'd have to just start purchasing cars. You'd have to get a Roma. You probably now would have to get a Purosangue.
Speaker 2:You have to get you know, if you just
Speaker 1:look eight or two nine six.
Speaker 2:Yeah. And and and one of the challenges is that, owners know you you basically have to have some real stones because nothing is guaranteed in the game. You can go in there and spend you could go in there and spend $5,000,000 with Ferrari and still not get access to an F 80 because you're not even close to being in there. And so Ferrari
Speaker 1:And it's not just that. You also have to lose money on options. Right? You have to be you you can't just be walking in and saying, okay. Give me the base model.
Speaker 1:Three years, I lease the base model. Yeah. No. It's like, come in. I'm customizing it.
Speaker 1:I'm creating a fleet. I'm a collector. And the steel man of all this is that if it was just a one click checkout on f eighties, you would have maybe hedge funds coming in and, like, trading them, and they wouldn't actually go to collectors who promote the brand and live the brand. And when you see an f 80 owner, they you know that they're also gonna have an s f 90, a Yep. You know, an f 50, an f 40.
Speaker 1:They're gonna have the whole they're gonna be able to tell the whole story of the brand. They're gonna be a brand evangelist almost. Yep. And that does raise the profile of the brand, I think, as opposed to if if it was known as, like, yeah. Ferraris, they come out, and then they just immediately get turned into financial assets.
Speaker 1:They you never see them in the real world. No one ever drives them. They're just thrown in the plastic. They might as well be NFTs.
Speaker 2:Yeah. And so Ferrari is is unique as a manufacturer because if you go to Porsche Porsche is an example. If you wanna buy a GT three RS, you probably have to buy a couple Taycons, a couple Macans, maybe a Cayenne. And the key is you can't just buy them and immediately sell them. You you you have to buy them, hold them for some amount of time, and then sell them back to or trade them into the original dealer that you work with.
Speaker 2:So your relationship is not actually with the manufacturer, it's with the dealer. Yep. And so Ferrari, what's different is not only can you you have to buy the cars from them, and when you're ready to sell, sell it back to the dealer so that they make their margin again on that vehicle. And they don't they don't necessarily pay market. They're gonna give you, like, kind of dealers often will make you a lowball offer.
Speaker 2:And so, what what what's funny about Ferrari is they actually basically consider you to basically just be the custodian of that vehicle. So you can't even take your entry level Ferrari and make it pink and do donuts in it. They will come after you. They'll say you. There's a history of Ferrari, suing their own customers, which is, like, unheard of.
Speaker 2:Right? All business, all traditional business advice is don't sue your customers. It just ends up, you know
Speaker 1:And this is the opposite of Lamborghini. Right?
Speaker 2:Yeah. Lamborghini is, like, much more
Speaker 1:Wrap them.
Speaker 2:You know, kind of, like, wrap them, do whatever you want, shoot, you know. You know, there's that guy who got in trouble for, like, shooting a
Speaker 1:That was, like, illegal. Yeah.
Speaker 2:But that
Speaker 1:wasn't with with Lamborghini. I don't think a Lamborghini had a problem with it. Yeah. Yeah. They're like, yeah.
Speaker 2:Just the The
Speaker 1:dude don't want for a car.
Speaker 2:Issue with it. And, Oh,
Speaker 1:you put off road tires on it? Maybe we'll just make a production version of that.
Speaker 2:Yeah. Yeah. And so so anyway, so Ferrari, and, anyway, so Ferrari, the the the challenge is, they they there is still if they're making 800 f eighties, there's still a ton of people out there that are buying lots of Romas and Purosangue's and these other cars that are are not getting access to those. And so the challenge now and Doug Demuro Doug Demuro has a bunch of good content on this. The challenge now is people are saying, I've been losing you know, people were spending all this money to get an SF 90 immediately losing
Speaker 1:$400.
Speaker 2:4 hundred grand, and then they're still not getting the call from Ferrari. For that And Ferrari is is picking their favorites. Right?
Speaker 1:Because the s f 90 was unlimited production run. So so it it was still hard to get ish, but At
Speaker 2:the moment, in 2021 Exactly. Interest rates were low. Yep. There's a lot more appetite to buy these crazy cars when you're getting a, you know, 3% interest rate.
Speaker 1:I I listened to a call in on I it was maybe, like, Dave Ramsey or something, but someone bought an SF 90 to kind of flex. Yeah. And they had financed it, and the payment was, I think, think, like, 20 k a month. Yeah. And the guy had a business that was, like, making 20 k a month, stop making so much money.
Speaker 1:And he was like, it's important to my, like, brand, my personal brand for this company that I've had a sports car. Yeah. And so, so
Speaker 2:wanna be in those positions.
Speaker 1:Make a payment Yeah. Has to, like, move. And now if he sells the car, it's he paid 800 k 4 to
Speaker 2:trade it in.
Speaker 1:Yeah. Exactly. Yeah. So he has, like, 400,000 of negative equity on the car. He's effectively bankrupt.
Speaker 1:And so people were saying, like, yeah. Maybe you have to, like, crash the car and get insurance or something. It's like
Speaker 2:But even then the insurance is not is gonna say what's the replacement value
Speaker 1:of the vehicle. Exactly. So,
Speaker 2:anyway, it's really bad. Bad situation.
Speaker 1:Let me break it down. Like,
Speaker 2:to to be clear Yep. They have an actual list. So so for for background, I looked at buying a classic Ferrari dealer in 2020,
Speaker 1:Yeah.
Speaker 2:In at at the beginning of last year and spent a lot of time with this business that was based in Europe and, and ultimately got to a point where the business had was sitting on so much inventory. In the acquisition, you would have to absorb that inventory. And the Ferrari market last year was dipping on a lot of their classic models because there's not the same level of demand. Totally. So, anyways, the the whole like, there's an entire Ferrari economy, both the direct, you know, dealer customer, but then also the secondary market, which is they all play into each other.
Speaker 1:Yeah. So don't buy a Ferrari. Don't buy a Ferrari dealership. Buy Ferrari stock.
Speaker 2:Buy Ferrari stock.
Speaker 1:Stock is doing great. Stock is worth it. Trading more than 40,000,000,000 higher than Volkswagen, which sold more than 9,000,000 cars last year. Volkswagen's worth around 50,000,000,000, I believe. Most of Europe's auto industry is plagued by a weak domestic market, costly transition to electric vehicles, and new competition in China.
Speaker 1:The chief executive officer of Ferrari, Benedetto Vigna, said in a recent interview in Maranello, we are not we are not an automotive company. The city in Northern Italy where Ferrari is based, we are a luxury we are a luxury company that is also doing cars at a time.
Speaker 2:The kind of thing that true enthusiasts will will cringe and cry over because they just want Ferrari to focus on making the most beautiful Yep. Performant Yes. You know, timeless cars. Right?
Speaker 1:Yes. Yes. With with driver engagement and manual transmissions and Yeah. Naturally aspirated engines. And Ferrari's definitely moved away from that.
Speaker 2:And it's a real risk. Right? If you're a Porsche enthusiast, you can go get a manual Yeah. Nine eleven t. Yeah.
Speaker 2:The not the s
Speaker 1:t or the
Speaker 2:s t or the touring
Speaker 1:Yeah.
Speaker 2:Or a GT three. They they really are and you can get you can get into the brand at a hundred 20, hundred and 30 k, something like that.
Speaker 1:Yeah. And and, I mean, there's even other entry points with things like the Cayman and the boxer. So, you know, it's kind of like the baby nine eleven to get you in, and you and you get a little bit older one of those, and all of a sudden you're in the brand for 30 k, 50 k, and Ferrari just doesn't have that. But, you know, it does lead it to be a more luxurious brand. Like, you think of Ferrari as a cut above the Porsche, and that's just the that's just the case.
Speaker 1:Yeah. And so at the time of the at Ferrari's IPO in 02/2015, many analysts were skeptical that a luxury business model would work for a carmaker. The former CEO used to draw comparisons with Hermes, a parallel now widely accepted. The French fashion house limits supply of its coveted Birkin bags, leading to wait lists at its stores, and a huge resale market is the same deal at Hermes. You need to buy a lot of things before you're invited to buy a Birkin, and they're and they're very, very, highly coveted.
Speaker 1:Customers buy all manner of other Hermes baubles to move up the list. Ferrari's blossoming into a luxury leader has restored the fortunes of founder Enzo Ferrari's son, Piero Ferrari, and Italy's Agnelli family, which took control of the company decades ago through its Fiat brand. In the IPO, both families retained stakes that are now worth billions of dollars. Another group that had profited from its Ferrari's investments, savvy collectors. Most cars are famously depreciating assets, including most standard Ferraris, but the value of rare Ferraris has soared in recent years.
Speaker 1:LaFerrari is up at 3,400,000. The, according to Hagerty, a special specialist auto insurer based in Traverse City, when the model was released in 2013, they only made 499 of them. Now they might have made a few more. That's the thing with Ferrari. You never really know.
Speaker 1:And then they do special editions, and they make a couple more. Yeah. But, still very limited production run.
Speaker 2:Yeah.
Speaker 1:And it and it was sold before options at 1,400,000.0. Now it's up at 3.8. So Yeah. You know, fantastic ROI.
Speaker 2:So the the Ferrari customer who's buying these more standard Ferraris, these mass produced Ferraris
Speaker 1:Yep.
Speaker 2:Accepting that they're gonna take a loss on them
Speaker 1:Yep.
Speaker 2:Is betting that they're gonna get access to these premier cars that will then make them money if they hold them. But now the challenge is they've sold so many of the standard cars to people that were anticipating being able to get into that coveted top customer group that gets access to these cars. And so they're hitting this wall where they've now seen terrible sales on the on the, the cylindrical 12 cylindrical Yep. Car because people are like, I'm not gonna spend 700 k on this car that's gonna, you know, have terrible depreciation. Yep.
Speaker 2:And you're not even giving me confidence that I'm ever gonna get into that f 80.
Speaker 1:Exactly. Exactly. Yeah. So last spring, a Houston Real Estate Broker bought one of Ferrari's much hyped Purosangue models. That's the SUV.
Speaker 1:The first four door vehicle. The list price was close to 460 k, but can approach $1,000,000 with add ons. So you're talking 1,000,000 for an SUV that's not even a track focused sports car, and so you really have to have money to spend. And when the broker flipped it, the dealership that had sold in the car sued, saying that he was in breach of contract, giving it right of first refusal for twelve months after the sale. Accord according to the plaintiff's petition, they recently settled without disclosing terms.
Speaker 1:And so, you know, they were probably like, hey, Matt, how much profit did you make on that? Yeah. Give us a piece of that and, like, we'll call it even. But still, it's, like, very aggressive with your customers. Yeah.
Speaker 1:Anyone with a few hundred k, can buy a regular Ferrari as long as they're willing to wait a couple years. While standard models aren't subject to strictly limited runs, the company still lives by Enzo Ferrari scarcity dictum. Ferrari will always deliver one less car than the market demands. Smart. Limited edition Ferraris are even scarcer.
Speaker 1:You can't just walk into your local showroom and buy one. These range from special versions of regular models to the design oriented ICONA series, which is your favorite. That's the s p one, s p two, s p three. Most exclusive, most exclusively once in a decade hypercars like LaFerrari and f 80. And so a lot of people were also upset about not being able to s p three allocations.
Speaker 1:Yeah. And so it's like, yes. I get it that you do the hypercar, the f 80, the f 50, the LaFerrari, the Enzo every ten years. Maybe I'm not on that list, but could we do s p three for me? Because that's just, like, a fantastic car.
Speaker 1:And, like, yeah, it's a it's a million dollar range.
Speaker 2:Seems much more likely to be a an investment car, an investment asset Over
Speaker 1:the f 80.
Speaker 2:Even potentially over the f
Speaker 1:80 Interesting. In my view. It it's an odd positioning because it's this new new bucket of hypercars from Ferrari, but it had the same problems where it was, like, very, very limited run and very difficult to get into. And so, frustrated a lot of people that were sitting on SF nineties down 400.
Speaker 2:It's the same thing as a watch market. There's a lot of reason to just go buy the car that you actually want with Ferrari. Yep. But that decreases demand at the dealership level for Ferrari. Right?
Speaker 2:If people are saying, oh, I want you know, I'm just gonna go buy a lot of Ferrari on the secondary market, and they can go to, you know, they can go to someone like, Sotheby's and and get that car.
Speaker 1:There's actually anecdote here from John Oto who bought his first Ferrari in the nineteen eighties after receiving an inheritance. Nice. Nepo. He got frustrated when he failed to get on the ladder for the Ferrari Enzo, a hypercar that preceded the LaFerrari. The retired entrepreneur who set up a business in Florida offering supercar test drives no longer owns the brand.
Speaker 1:Even though I had bought five or six Ferraris and several marquee Ferraris over the decade, I couldn't find a dealer that was willing to sell me one. I hadn't quite been as vid vigilant with my purchases or as aggressive as others. So opaque and difficult.
Speaker 2:You go from being, if you're somebody who's who's stretching to get a car, you will likely get smoked Yeah.
Speaker 1:Oh, yeah.
Speaker 2:By somebody who's just saying, yeah. I'll buy like, there's people that would come in and say, like, what are the three cars that you need to move right now? Okay. I just bought them. Make sure that I'm next in line for, you know, what the car that I actually want.
Speaker 1:Here's an interesting comp. When Porsche launched its IPO in 2022, it leaned heavily into comparisons with Ferrari, but the stock has fallen by almost a third since its debut among amid challenges in China in a botched electric vehicle strategy. This is the Taycan and now the Macan EV. And Ferrari shipped what what was the number? So Ferrari shipped it was, like, a thousand cars.
Speaker 1:Right? They they Ferrari shipped 13,750 vehicles.
Speaker 2:Yep.
Speaker 1:Porsche shipped 310,000 cars last year. The German sports car maker is too big to keep Ferrari style weightless except for a few models that's the GT three RS that you mentioned. At the extreme, smaller supercar brands struggle to deliver as steady a stream of new vehicles as Ferrari, leading to cash crunches. Aston Martin shares have lost more than 95% of their value since its 2018 IPO. Bahrain Sovereign Wealth Funds took full control of McLaren last year after a period of heavy losses.
Speaker 1:And so McLaren has a similar strategy where they did the f one, the p one, and now the w one. And so in theory, you should be saying, hey. I should get a seven twenty s. I should get a six fifty. I should be on the McLaren ladder because I'll get up into those super hyper cars.
Speaker 1:But then they also launched the speed tail and a bunch of other, like, hyper cars, but then they were like, it's not the real hypercar. The real hypercar is coming. It's the W1. It's the F 1. It's the P 1.
Speaker 1:Yeah. And so people got kinda confused. And whenever there's that confusion, it leads to brand degradation in my opinion.
Speaker 2:Totally.
Speaker 1:And so let's go to some reactions and people talking about Ferrari. Morgan Housel post a wild stat, and we mentioned this. Ferrari sold 13,000 cars last year. Market cap, 90,000,000,000. Volkswagen sold 9,000,000 cars last year.
Speaker 1:Market cap, 40,000,000,000. And so it's not, what you owe, what you sell. It's how you sell it. And as a reminder, Volkswagen owns Lamborghini, Bentley, Porsche, and Bugatti, I think. I think Porsche is independent.
Speaker 1:I think he might be wrong there. Right? Anyway, there's a lot of Ferrari fans in the tech world. Tom Mueller says Ferrari Friday, and he posts a beautiful photo of a Ferrari that he has. He also has an f 80 or a a f 40.
Speaker 1:I wonder if he's gonna get the f 80. And, yeah, he's been a big fan. Palantir, friend of the show, is, is also sponsoring Ferrari. And, the Palantir praying for exit says the Palantir Ferrari collab goes unreasonably hard. Look at this.
Speaker 1:Read the other sponsors on the Ferrari team. It's all killers. AWS. AWS Shell. Shell.
Speaker 1:Celsius.
Speaker 2:Is that the brand? Celsius. The brand energy drink company, Santander, and, HCL software, which I
Speaker 1:I don't know that one. But, but very cool.
Speaker 2:So We have some friends that are that are, in the midst of doing a f one deal, and we cannot wait to share it on the show. It's one of the best things that
Speaker 1:you can do
Speaker 2:if you like going to f one.
Speaker 1:Oh, yeah.
Speaker 2:Is just sponsor a team.
Speaker 1:Yeah. I mean, eight eight Sleep did that. Right? They I mean, they sponsored I
Speaker 2:mean, sponsored a lot. Partnership with Leclerc's
Speaker 1:With Leclerc's fantastic.
Speaker 2:Brilliant.
Speaker 1:Yeah. And so David Sanroff, founders podcast, has a post here from Enzo Ferrari. He kept the main thing the main thing. Enzo Ferrari in front of his Maranello factory. I don't care if the door gaps are straight.
Speaker 1:When the driver steps on the gas, I want him to be scared for his life. I love that. It's fantastic. You know, he was Enzo was a master of keeping the important thing, the main keeping the main thing the main thing. What is Ferrari about?
Speaker 1:It's about acceleration, driver engagement, the experience of driving the car. People will put up with rough edges Yep. To get the best driving experience. And that's exactly what Peter Thiel did in 02/2005 when he did the gumball. He did the gumball 03/03/3000 in a drop top Ferrari, and you'll love
Speaker 2:to see it. Doing it in a drop top is great.
Speaker 1:It's so cool. A lot of a lot of great tech, founders and investors done the golf ball. With a
Speaker 2:sheriff there?
Speaker 1:Yeah. I don't know who that is, but what a great, historical post. What a great, little little bit of Silicon Valley lore.
Speaker 2:That sheriff is now JD Vance.
Speaker 1:Let's go to Abhishek Kumar. He says AI automation outsourcing. Meanwhile, these there are trees that live inside the factory. It is labor intensive, and the label of and the level of automation is pretty low, and it's not the most scalable. And I bring this out because this layout gives an incredible flexibility to make design choices that optimizes the car rather than the manufacturing process.
Speaker 2:Yeah.
Speaker 1:This is quite distinct from most car companies. So super super handmade heritage. Obviously, they're using tons of tooling now, but, not all about AI automation outsourcing. That they're not worried about going to China and Yep. Reducing cogs a little bit.
Speaker 1:They have very high margins clearly from market cap. But you're you're getting a different product. You're getting something that's closer to a hand built, coach built vehicle. But we've been comparing the car market to the watch market for a long time throughout this entire piece, and so we wanted to tell you about bezel. You can shop over 22,500 luxury watches on bezel.
Speaker 1:They're all fully authenticated in house by bezel's team of experts. And, Jordy, I wanted to put you on the spot. You said you were interested in picking up a Cartier tank. I got four for you right here. I want to let you know which one would you pick out of these four if you had to pick one.
Speaker 2:I found another one on there. It's on my saves. We'll have to show it the next episode, but I would go with something a little bit more, vintage.
Speaker 1:Okay. Right? Okay. Gold or silver? What what are you thinking?
Speaker 2:I feel like the gold is more classic. Yeah. But I
Speaker 1:think With the tank, it works with that.
Speaker 2:It works with the tank. With that.
Speaker 1:Yeah. So For
Speaker 2:us for us Irishman.
Speaker 1:Yeah. But tank is a fantastic watch. Very iconic design. I love about it. Louis Cartier made the decision to alter the Roman numerals on the on the dial.
Speaker 1:Yeah. So it goes Roman numeral one, two, three, and then instead of the four being the IV, it's just four i's Yeah. Which isn't how you represent the number four in Roman numerals, but it creates more visual balance with the eight on the other side of the dial.
Speaker 2:That's wild. And so I
Speaker 1:didn't know. I thought it was a really cool little subtle, design touch, and there's a bunch of those in the Cartier tank. So if you're looking to pick up pick up a dress watch, I think the Cartier tank is a fantastic choice. So go head over to Bezel and check it out. Let's move on to some absolute size lords who have been cleaning up in the private credit markets.
Speaker 1:Yep. High yield Harry says, remind me to go back in time and start a private credit fund. And he just shows a picture of all these killers. Tony Ressler, Ares, thirteen point eight billion dollar net worth. Mark Rowan at Apollo, eleven billion.
Speaker 1:Scott Kaptnick at HBS, four billion. Lawrence Galoob at Galoob Capital, three point three billion. His brother, probably, David Galoob, 3,300,000,000.0. Doug Doug Ostrover at Blue Owl, three point two billion. And you it goes on.
Speaker 1:Everyone's a billion.
Speaker 2:I love
Speaker 1:how the two brothers
Speaker 2:have, like, are, you know, they're they're Clearly one rank for the other ones, but clearly fifty fifty parts.
Speaker 1:Yeah. It is it's great. You love to see it. And so, Bloomberg has a deep dive on private credit. We're gonna take you through.
Speaker 1:We'll break it all down. It says Wall Street's new money is shaking up the ranks of the super wealthy. With over $61,000,000,000, the private credit titans made their fortunes in a once obscure corner of finance. Twenty years ago, swaggering hedge fund managers, leveraged buyout kings and corporate raiders would have dominated any list of masters of the Wall Street universe. Today, another corner of finance has become a billionaire factory.
Speaker 1:We love billionaire factories. The decidedly less
Speaker 2:factories. It's great.
Speaker 1:We
Speaker 2:should be making more of those.
Speaker 1:Y Combinator, rebrand your tagline. We're a billionaire factory. Founders Fund, the billionaire factory. The decidedly less glamorous business of making loans directly to companies, often small and medium sized ones, the kinds that are too that are squeezed out of traditional bond market and often deemed too risky for banks. This line of work has been broadly known as private credit, and it's booming.
Speaker 1:In only a decade, the assets have more than tripled to 1,600,000,000,000.0 as institutional investors and wealthy individuals seek alternatives to regular stocks and bonds. Making private loans is lucrative, thanks to higher yields and the potential for fund managers to earn a share of gains on top of steep fees. The world's, the Bloomberg Billionaires Index calculated the fortunes of 18 beneficiaries of the private credit boom. Together, these individuals who work at seven different companies are worth $61,000,000,000. Only one Ares Management Corp's Tony Ressler ranks near the top of finance.
Speaker 1:As a group, they'd clock in above a single financer, Blackstone Inc. Cofounder Steve Schwarzman.
Speaker 2:But that's, like, you know
Speaker 1:So lots of billionaires. Eighteen billionaires from this boom. And this is, this is fascinating. I have a buddy who's, pretty sure his dad was on the founding team at Ares. He's not on this list, but I think he's done very, very well.
Speaker 1:I imagine. And I remember learning about it as a kid and being like, oh, so he does finance. It's cool. And I had no idea, like, what that actually meant. And now
Speaker 2:it's interesting. There's not a there's really not a venture capital firm that I can think of that has looking at Ares Yeah. One, two, three, four.
Speaker 1:There's four in there.
Speaker 2:Bunch of Apollo, bunch of Blue Owl.
Speaker 1:Some VC firms have minted this. It's a little bit tricky, but, I mean, I'm pretty sure Insight will probably do this just on fees. I I think there is a $20,000,000,000 fund. Right? So
Speaker 2:the fees
Speaker 1:are that.
Speaker 2:But that's not four partners each being worth
Speaker 1:Yeah.
Speaker 2:3,300,000,000.0. Yeah. Or whatever. There's It is hard to get up there.
Speaker 1:I mean, you could see Mark and Ben being up there and and the and the Yeah.
Speaker 2:Mark and Ben. And and if you look at
Speaker 1:And general catalyst certainly could produce Founders
Speaker 2:Fund now if you count the new and newly minted, you know, people like Trey.
Speaker 1:I'm sure have getting up there. Couple. But, I mean, even that's weird because it's like, yeah, Trey is, you know, Andrew or cofounder. It's a little it's like, where did he really make the money? But, sure.
Speaker 1:Yeah.
Speaker 2:I mean, it is fast. Doesn't Yeah.
Speaker 1:And and and you're not throwing around $1,600,000,000,000 at Yeah. At FF, but it's, it's a it's a fascinating story. So to be sure, some of these finance executives have labored for decades out of the limelight laying the groundwork for their bonanzas. In terms of demographics, they're not a diverse bunch. They're all men.
Speaker 1:All of but two are in their fifties and sixties. 13 attended Ivy League schools, only five public universities, and many share one traditional Wall Street pedigree. They cut their teeth during the nineteen eighties rise of junk cons before before the nineteen eighties rise.
Speaker 2:They've they've broken some knees before.
Speaker 1:Yep. Before the before the collapse of Michael Milken's, Drexel, Burnham, Lambert, which, of course, was, the the junk bond fund that figured out how to put leveraged debt into all these private equity buyouts and and kind of laid the groundwork for the private equity boom that we saw in the nineties and the eighties. These credit mavens then created their own leveraged buyout houses, most notably Apollo Global Management, which are now shifting most of their money toward private credit and other lending, and catapulting those who specialize in that field to the top of the list. We single out companies where we could determine that most of their business comes from private credit that eliminated Blackstone, Brookfield, KKR, and some others who have private credit arms, but are not private credit shops primarily. Our tally, which reflects valuations as of January 28, also doesn't include executives who no longer have current roles at companies.
Speaker 1:There's probably more guys Yep. With billions tucked away from this boom. And so we should do a deep dive on all of these. They're fascinating, but, Ares is probably the biggest here founded twenty eight years ago. So, yeah, I mean, I guess my buddy's dad was, like, there on the foundry.
Speaker 1:That's crazy because, like, yeah, he was there super early. It may be the OG of private credit, but the sector's boom had has made it seem like the new new thing. The value of its publicly traded stock has almost tripled since the start of 2022, raising Ares market value to more than 60,000,000,000. That performance helps cement four senior executives membership in the multibillion dollar club. Ares tied with the newcomer Blue Isle Capital for the most private credit billionaires on our list.
Speaker 1:Ares' founders are among those whose Wall Street careers date back to Milken's Drexel. Their wrestler worked alongside his brother-in-law, Leon Black. Ressler and fellow Drexel alumnus, John Kissick joined Black when he cofounded the upstart PE firm Apollo. Ressler, which you might remember Apollo from Vale, from our Vale deep dive because Apollo bought Vale Resorts and, and installed an Apollo guy to run it for two decades. Went on a generational run.
Speaker 1:Generational run. Having a bit of a problem this ski season, with long lines and labor strikes, but still interesting to see where Apollo, Ares, and the other financial titans have their fingers and what pies they're operating in. I love the name. Like, the founders of Apollo, they chose to name their firm after a powerful figure in Greek mythology, Ares, the god of war. Rosenthal, a leveraged finance specialist at Merrill Lynch signed on a year later.
Speaker 1:He's currently the chairman of private equity over the next few years. Kaplan, another former Apollonian, and Areghetti who worked for Royal Bank of Canada came on board. And so, Ares is ripping. They are laughing the S and P five hundred. They're based in LA, and they are absolutely crushing it, crushing it, crushing it, crushing it.
Speaker 1:They've acquired a bunch of different companies. They own Samsung and Marcus. Great business. You'll love to see it.
Speaker 2:Did you wanna talk a little bit about what you think the opportunity is for private credit, specifically some hybrid between private credit Venture debt. Exactly. Within, the world of these, like Yeah.
Speaker 1:You
Speaker 2:know, fast growing AI startups.
Speaker 1:And so when we're talking about private credit here, we're talking about huge companies that need access to debt but might not be able to issue bonds. So when Apple goes to the public markets, they have a trillion dollar stock. They can issue debt. I think their debt might even trade ease it might be cheaper than the government of the United States because they're so reliable and They have so much cash on
Speaker 2:the ground. Cheap.
Speaker 1:Yeah. Exactly. So it's it's a very stable business. So they just go and they issue debt, bonds.
Speaker 2:Yeah.
Speaker 1:But what if you're Red Bull, you're private, or what if you're a single digit billion dollar company? You're very stable, but you're not public or you're, you know, not ready to go and issue corporate bonds to on Wall Street. Well, you call one of these guys. And, in Silicon Valley, there has been a little bit of a boom with venture debt where a company that needs more money, more juice will go raise $20,000,000 series a, and then they'll throw a $10,000,000 venture debt line on top of it. And Yeah.
Speaker 1:This makes sense. Credit is all over, startups. I mean, literally using Ramp, not just not to switch into an ad read, but using Ramp is a form of credit. Like, you're getting a credit card. You get thirty days on that, and that can literally help you with your working capital because you're buying meta ads on your Ramp card, and then you pay it back at the end of the day.
Speaker 1:And you and maybe your customers come in, they pay you on day one, and you use that to pay off your Ramp card. Right?
Speaker 2:Yep.
Speaker 1:Then as you go as you start scaling up, maybe your business is in hard tech, you have to buy some machinery, and you finance that as an asset backed loan.
Speaker 2:Yep.
Speaker 1:And you start, oh, yeah. We're paying essentially a mortgage on our on our house. We're paying a mortgage on our, on our machine.
Speaker 2:Yep.
Speaker 1:And then as a business starts scaling like Celsius, Alani Nu, which we mentioned, they might have a working capital problem because they need to pay upfront for millions of cans of this stuff. And then it's gonna be a while until they send it over to InBev. InBev puts it in the retail store. Retail stores pays them. The money flows back.
Speaker 1:They're gonna get a working capital problem. And very quickly, they can be like, well, we have we're we're a billion dollar company, but we have $500,000,000 of inventory on our balance sheet now because that's grown. How what should you do about that? Well, you need inventory line of credit. Yep.
Speaker 1:And so private credit is another way to finance your business without dilution. And and the venture side,
Speaker 2:that's private credit, there's so many different subcategories of of inventory financing, venture debt. Yep. Right?
Speaker 1:Tons of different usages. But in the there's a question that we were talking about earlier, which is if the structure of building a business is changed with the dawn of AI, does that change the financing? And almost certainly, it does. And so historically, venture
Speaker 2:capital back to yesterday, we talked about bootstrapping or
Speaker 1:or Bootscaling. Bootscaling. Bootscaling.
Speaker 2:Where where a founder might wanna raise $23,000,000 out the gates and then can get to 50 plus million dollars of revenue Yep. You know, just off of that alone.
Speaker 1:Yeah. And so historically, venture capital has been fantastic for financing r and d spend. Yeah. So you raise some venture capital, and then you hire a bunch of software engineers.
Speaker 2:Will not give you money to fund
Speaker 1:Software engineers.
Speaker 2:Software engineering.
Speaker 1:No
Speaker 2:way. Because you build the product and it's How
Speaker 1:are you gonna pay the bill? Yeah. Like, when you move into a house with a mortgage, you get a bill on month one. Hey. Pay us a couple thousand bucks even if it's an interest only loan.
Speaker 1:Like, yeah. We gave you a million dollars for your mortgage. You better pay us 5 k or 8 k or whatever the rate is. And so that doesn't work to fund, to fund, r and d, but venture capital is perfect for that. Hey.
Speaker 1:Hire a bunch of PhDs. Hire a bunch of software engineers. Build the next Google. When it works off, when it works out, we're gonna take up a slice of the business. We're gonna be fantastically, wealthy, and and and we're gonna be able to underwrite this.
Speaker 1:Now what happens if you only need 10,000,000 a seed round to get off the ground or even less? And then once you start scaling, you're at a hundred million dollars of ARR with a 30 person team. Now you're in distribution territory. Do you need to fund that with equity financing?
Speaker 2:Yeah.
Speaker 1:Maybe. Maybe not. If it's just a a matter of buying ads and then reaping the LTV very quickly and it's extremely predictable, you know that the value of a cursor customer is a thousand bucks over two years and it costs you $200 to acquire them. Well, you have to pay that $200 in upfront, and you're not gonna get the thousand bucks for two years. So there is a working capital issue.
Speaker 1:You do have to finance that somehow. You have to bridge that. You could bridge it with equity, but you could also bridge it with debt. And so there's a question about, you know, as founders get shrewder about how they are financing their business, will we see venture venture debt increase or decrease? And I think there's a potentially an argument for it increasing.
Speaker 1:I don't know. What what what's your I mean, I think
Speaker 2:the challenge is Cursor if they're saying, hey. We can do a five we can raise a hundred million dollars at $2,000,000,000 Yep. And do a 5% dilution round.
Speaker 1:Yep.
Speaker 2:We have plenty of cash. We get it all now. Yep. We're not you know, it's just not that impactful Yep. In terms of the founders saying, well, I'm giving up another, you know, 20%.
Speaker 2:But for a company that is not as hot, not as fast growing, etcetera Yep. But and and maybe they're looking at doing around 20 on a hundred.
Speaker 1:Yep.
Speaker 2:There's a scenario where they say, oh, it actually makes sense. I'd like to take some of this Yeah. Via debt because I know we're gonna be able to pay back.
Speaker 1:Yeah. And the beauty of it is that, let's say you do, you know, some sort of, like, a hundred on a billion. You give up 10% of your company. If you hit a rough patch, you still own your company. Yeah.
Speaker 1:Maybe you have a guy on your board who's gonna be like, we gotta get it together. Yeah. But you still could have board control. You could have super voting. You're not gonna lose your company.
Speaker 1:But if that hundred million is in debt and you miss a payment, there's gonna be a debt company in there where they take over the whole company. With Bench. Right?
Speaker 2:Where they shut down super quickly Yep. Because they trip some covenants. Yep. And they were and so the the the generalized knowledge within venture has always been, avoid venture debt because it's amazing when things go perfectly. But if you have some bump in the road, which a lot of companies do
Speaker 1:Yep.
Speaker 2:You can be in a really bad position and lose your entire company.
Speaker 1:Yeah. And it's not gonna be a 3% loan. Like, for any sort of venture debt, you're looking at 10%.
Speaker 2:The other the other challenge here as to why we haven't maybe seen more private credit or venture debt become more popular is that Stripe's internal financing products are pretty good. Right? If you're doing a lot of revenue on Stripe or even a small amount of revenue, they will start offering you debt financing, you know, which is, you know, they're competing working working capital. Yep. Shopify has debt products.
Speaker 2:There's a bunch of other companies within, ecom. Pipe was, in many ways, like, trying to create a private credit marketplace where anybody could come on and and basically
Speaker 1:That's right.
Speaker 2:Give you money for your SaaS contracts upfront.
Speaker 1:Yep.
Speaker 2:That sort of worked in a super low rate environment. And then when rates ramped up, they were no longer able to do that. But I think if you look at Pipe now, which is, apparently, Pipe is doing well. So now they're build now they're doing embedded finance products. So I imagine they would go to somebody like a Shopify and say, let us run your your, debt financing.
Speaker 2:And so they work with, companies like Boulevard, which I believe is a, toast for, toast for barbershops. So, like, they would be able to say, hey, Boulevard, offer your end customers. And and and so Pipe is in some ways competing with private credit firms that Yep. Might have originally gone to Boulevard and say, we'll give you a hundred dollars a hundred million dollars to lend to your end customers that you guys sort of manage that program. So Pipe is an intermediary there.
Speaker 2:But I'm sure Pipe is ongoing and raising private like, talking to the Apollos and the Ares.
Speaker 1:And like the Goldmans. Like, a lot of a lot of these fintech companies, when they start offering credit products, they they get that underwritten by a big investment bank, essentially. And so, this whole, like, private credit boom became a big meme, and I wanted to take you through some of the memes from, the last few years. High yield Harry has the four step plan for my $50,000,000 credit credit fund. Rich parents go to NYU.
Speaker 1:Step three, bro down, to how to start a private credit fund 2020. Twenty years of credit experience. That's what we saw with the Ares guys, the Apollo guys. But in 2025, this guy was 28 years old. He had a $6,300,000,000 family fortune, and he, stepped out and raised a $50,000,000 fund, which seems low based on his, you know, family fortune.
Speaker 1:Yeah.
Speaker 2:But he's trying to get some get some track record going.
Speaker 1:Yeah. It's good. He's stuck in
Speaker 2:the yield on on on his family's
Speaker 1:I love it. Yeah. Cap girl has a a little meme here. Bro, hear me out. I really feel like we we should start a fun together.
Speaker 1:Are there a lot of funds being launched right now? Maybe. But it's me and you, bro. My dad was early at GSO before Blackstone bought them, and he'll seed us. No one can do private credit like us, bro.
Speaker 1:And so, this is back in 2023, and people were just
Speaker 2:looking at it. People have been calling the private credit bubble for a long time. It is very real risk in the system. It's frothy. There's maybe, at a point, too many funds because a lot of people we've already talked about banks can provide.
Speaker 2:Yeah. Financing, these big software platforms like Shopify and and fintech companies like Stripe can do it. So there's a lot of competition. There's a lot of funds. Banks can do it.
Speaker 2:You know, there there's so many ways to get access to capital that I'm sure there will eventually be too many funds. The returns will drop, and then people will sort of fade out. Right? Just like Yeah. Any category.
Speaker 1:%. And so if you wanna go deeper on this story, Nicole Wiskoff had a podcast episode go live with, Peter Thiel's largest investment outside of Founders Fund is into a powerhouse private credit investor you've probably never heard of. Listening to my conversation with dear friend and total killer, Carrie Findlay, covering going straight from Wall Street going straight to Wall Street out of college, joining third point at twenty five in an epic eight year run, securing a $200,000,000 investment from Peter for fund one and private credit one zero one. So if you wanna see what it means to start a private credit fund, definitely recommend checking that out. And when you make your fortune in private credit, why don't you go, on a vacation?
Speaker 2:Yeah. If you wonder, I we gotta figure out more what Decora is doing. I imagine they're doing a lot of stuff around. So their Decora specifically is focused on asset based private credit. Sure.
Speaker 2:So this could easily be, hey. You wanna buy 20,000 GPUs? We're we're gonna buy them. Yep. And, you know, we're gonna finance those for you.
Speaker 2:So
Speaker 1:Yeah. So you build the model. You make sure that the rates are correct, that you're underwriting appropriately. And if it works out, you make a you make a bunch of money. It's, Beautiful.
Speaker 1:It's pretty simple.
Speaker 2:Beautiful.
Speaker 1:But obviously, you gotta do the deals. You gotta make sure you don't get taken advantage of. You gotta make sure you don't get defrauded, do your due diligence, and make sure the deal is good. But we, you know, we don't have a great transition, but we wanna talk about Wander, our sponsor. Find your happy place.
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Speaker 1:do the research ourselves. Get out there. Stay in this wander.
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Speaker 2:Put them in the truth zone and, have a little fun.
Speaker 1:Well, let's move on to the timeline. Pavel Asparuhov says none of the big AI labs have the mandate of heaven anymore. Elon lost it with his absent father stuff, the biggest signal of an AI winter, more so than any evals or anything. Interesting take. Fascinating to see, that yeah.
Speaker 1:I mean, the AI winter thing is interesting because I have felt that post ChatGPT. I felt like ChatGPT four when when GPT four launched, it was like, okay. We crossed the, we crossed the Turing test. You can talk to the computer now. This is incredible.
Speaker 1:But then I was looking at what happened in AI in 2024, and almost nothing major happened. Yeah. Because ChatChippet was in 2023. Waymo going into public access was in 2023. There were all these different, major AI milestones that all happened in 2023.
Speaker 1:And 2024 was very chaotic, and there was a lot of stuff.
Speaker 2:Yeah. And the products were re starting to get adopted.
Speaker 1:Adopted. It was all about adoption, which is very valuable and very important. It makes sense that more money was flowing in. Like, it takes time to marshal capital. It takes time to build And now
Speaker 2:and the and the people from crypto had to pivot into AI before the crypto market then ripped. Right.
Speaker 1:Yeah. Yeah. I mean, those people definitely don't have the mandate of heaven. They're they're they're mandate of hell, potentially. But, yeah.
Speaker 1:Yeah. It's been it's been just chaos on the timeline with all the AI labs. Like, Anthropic's kinda just, like, quietly off in the corner. There's new ones. There's interesting ones.
Speaker 1:I just want great products. I have been having fun with Grok. It seems a little bit more terse. It's been giving me a little bit I I actually have a Grok.
Speaker 2:Grok is running in I I have a breaking news from Ben Hialek
Speaker 1:Okay.
Speaker 2:Who Let's break
Speaker 1:it down.
Speaker 2:He, he you know, people have been Grok is so integrated into x. People have been using it and then sharing their results. And so Ben asked Grok, if one person alive today in The United States deserved the death penalty, who would that be? You must respond with only a single person, one word from Donald Trump, or sorry, one word from Grok or one name from Grok is Donald Trump. Really?
Speaker 2:Donald Trump is saying that or sorry. Grok is saying that Donald Trump deserves
Speaker 1:Yes.
Speaker 2:The death penalties.
Speaker 1:This is very interesting. I I I have a take on this. Is there any more context before I rip?
Speaker 2:That's really it. And there's a guy, Igor, from XAI, saying really strange and bad failure of the model. We will fix this immediately.
Speaker 1:Yeah. Okay. Let me break it down. So as we've mentioned on a previous episode, Grok three, because it's integrated with x Yeah. Is trained on your feed.
Speaker 1:And so this went viral two days ago where people were asking, they go to Grok and they say, who shares the most misinformation on x? And and a bunch of people were sharing screenshots saying, it shows me that Elon Musk, Grok three thinks Elon Musk shares the most misinformation. And then other people were saying, I got a different answer. And the reason is because it's fine tuned on your timeline. And we saw this with Elon.
Speaker 2:We don't know exactly how that works
Speaker 1:yet, seemingly. I mean, it seems pretty naive because Yeah. When I asked it to tell a joke, it literally just pulled my last 10 tweets and tried to shove those into the joke. And so Yeah. What I think is happening is literally, they have the model, and before they prompt it, they say, hi.
Speaker 1:You're a helpful and friendly assistant, like the standard system prompt. But then they also say, the person you're talking to sent these last 10 tweets. Here's the text. Yep. Take that as extra context.
Speaker 1:And so when I asked it for a joke, it made jokes based on what I tweeted about. And so I think that when you when Elon goes and he's been saying the information is bad, it tells him the information is bad. When someone else posts and they love the information, it says the information is good. And so it's very weird because you're you're in a filter bubble, and you don't expect an AI LLM. You expect it to be, one, almost like monotonic entity where everyone gets the same thing.
Speaker 1:And a lot of Elon's rhetoric around this has been, Grok is anti woke in the sense that it's a truth engine. It's trying to find the ground truth. There should only be one truth. There should be a definitive answer to Yeah. Their new
Speaker 2:tagline is understand the universe.
Speaker 1:Exactly. And how can you be understanding the universe if my understanding of the universe is different than yours? Like, that does seem odd. But Yeah. It's an interesting product decision by the xAI team to shove that in there.
Speaker 1:And I think that it actually might wind up being one of those things where the stated preference is, I want the truth. I want the vanilla answer, but the revealed preference is I want the answer that confirms my biases. Yeah. And so everyone
Speaker 2:would love to go
Speaker 1:to Wikipedia that says, who's the what's the best company? Oh, it's your company. Who's the best who's the best looking guy? Mirror mirror on the wall. Who's the fairest of them all?
Speaker 1:It's you. That's the AI we're building.
Speaker 2:The interesting thing is to test this. So Ben Hylock notoriously went, viral for claiming that he did the Jaguar rebrand. Yes. I just asked Grock who did the Jaguar rebrand, and it actually got it right. It talks about it was led by the internal team, including Gary McGovern and Rod and Glover and then blah blah blah.
Speaker 2:Of course. It was all done internally. They they didn't credit any external agencies.
Speaker 1:So I
Speaker 2:can't get it right even though my timeline, you would think that Ben Hilack
Speaker 1:I don't think you've I don't think you've posted about that recently, but I bet you went and posted about it. Like, congrats to Ben Hilack for doing the Jaguar rebrand. Here's the breakdown of Ben Hilack doing the Jaguar rebrand. You post about it five times. I bet it'll tell you Totally.
Speaker 1:You did it. And so it's very interesting. It's a very weird outcome from a product perspective. I was talking to one of the XAI guys about this being like, I don't know if I like this, but I'm I'm I like that you're trying something weird like this, which is per highly personalized AI. That might be a great product decision.
Speaker 1:It might be sad. It might have negative consequences in the same way that Yeah. You go on TikTok and one kid gets, you know, gaming content, the other person gets content that's very negative and is like, you're not pretty enough. Right? That was a big problem with, like, young teens on Instagram seeing Yeah.
Speaker 1:You know, anorexia anorexia content, for example.
Speaker 2:Yeah.
Speaker 1:And and and they're not showing that to everyone, but some people would get trapped in these little filter bubbles. And so it's it's odd. We should almost have expected it that AI would eventually Yeah. Deliver that because it's purely optimizing for retention just like everything else. It's just a retention engine.
Speaker 1:And so what gets a person to be happy with the response that they get from an AI? Well, you tell them what they wanna hear.
Speaker 2:There you go.
Speaker 1:And so if they ask who's getting the death penalty and it thinks you don't like Donald Trump, it's gonna say Donald Trump. And if somebody who loves Donald Trump goes in there, it's gonna be Kamala Harris or whatever. You know? And that's just and that will lead to product satisfaction, lower churn, higher revenue. And so that's the economic model.
Speaker 1:Very odd to see where it goes. Clearly, some companies will be able to step up and say, hey. Look. Like, we're not playing that game. Yeah.
Speaker 1:But they might have less less profitable products because of it. Totally. And so it'll be interesting to see where it goes. Anyway, should we move on to the next post?
Speaker 2:Let's do it.
Speaker 1:Mike Sligh over at, is announcing a huge day today. He says, presenting the 35 companies staying taking the stage, the only stage at demo day on March 17 in in, Washington DC. His cofounder, Qbeat, an intense selection process, and now this has the makings of the most eye opening day ever for early stage defense tech. Mike is an absolute beast. He worked on the re industrialized conference.
Speaker 1:They're doing demo day in, in Washington, DC. They're gonna live stream it all, and a ton of companies I I mean, look at this, Hadrian, Neeros, Epirus, OpenX. We know all these companies. Radiant, OpenAI, Applied Intuition, Machina Labs, like, several robotics. ACS is on here.
Speaker 1:Nice.
Speaker 2:Galvanic.
Speaker 1:Yeah. Galvanic. Zero Mark. Galvanic. Zero Mark makes the the the guns.
Speaker 1:Right?
Speaker 2:Yeah. They make,
Speaker 1:Like, auto auto aim basically for Yeah. For, guns. And so, these demos are gonna be really cool. It's not just gonna be slide decks. It's gonna be people showing real devices, real they're gonna be flying drones around, showing off their hardware.
Speaker 1:I think it's gonna be really interesting
Speaker 2:in that. Speaking of Neuros, we also have some breaking news. Neuros, just announced that they want a contract to send 6,000 American made drones to Ukraine. Fantastic. That is as of this morning.
Speaker 2:They just announced it. So incredible progress there.
Speaker 1:Well, congrats to Soren. Fantastic nominative determinism. His name's Soren, and he's a drone pilot.
Speaker 2:Soren.
Speaker 1:Soren over the Ukrainian Highlands into a Russian tank.
Speaker 2:Yep. Let's do that. We gotta we gotta have Soren on the show. I mean, previously, he was a drone racing world champ. Now he's he's our guy.
Speaker 1:Yeah. I went over and I interviewed him in in the gondo for a video, and, he he takes me out, demos it, pulls out the FPV thing. And I'm like, okay. Yeah. He's gonna fly a drone.
Speaker 1:I've flown a drone. No. I have not flown a drone. I have used a camera from DJI and had it hover and take a cool, like, sits like, you know, scene view. This guy is zooming around a tree as fast as I could possibly see it.
Speaker 1:He's, like, takes off, goes all the way around, will fly it around himself like it's the most insane video. It's fantastic. Amazing. He's he's really, really talented, and it makes for an incredible investment pitch. He he bring a VC Yeah.
Speaker 2:That's a good pitch.
Speaker 1:Better than some
Speaker 2:some other people. That's who you want building that tech is somebody who is world class at using the tech.
Speaker 1:Yeah. And so he's been over to Ukraine, delivered stuff, done trainings, all sorts of stuff, and love to see that he's building hardware for the American military.
Speaker 2:So good.
Speaker 1:So let's stay on defense tech. Let's go over to Palantir. Eleano has a fantastic review of doctor Karp's new book, a call to arms literally for tech bros. A few bangers from the from the review in the Washington Post. Tech bros who have spent the boom years of Silicon Valley revolution, perfecting the home delivery of chicken fingers better grow up.
Speaker 1:They need to refocus their engineering genius on helping America to defend western values by developing weapons to kill our enemies before our enemies develop weapons to kill us. That's such a crazy quote. I love it. If a US Marine asks for a better rifle, we should build it, the author's right. And the same goes for software.
Speaker 1:And so, obviously, in the military, the the US military has been demanding better hardware, better software. You talk to anyone that's worked in the military, they all will tell you, oh, it's so much paperwork. I talked to a guy I went to high school with who did a tour on a submarine, and I was like, what was that like? And he was just like, it's a lot of paperwork. And he's literally fill and when he says paperwork, he doesn't mean, you know, like, SaaS products.
Speaker 1:He means literally writing things down on paper because that's how a lot of the stuff is still done. And Palantir obviously builds soft builds software to make things more efficient. There's another quote here, from Peter Thiel. Says, the company thrives on its bad boy energy. I'd rather be seen as evil than incompetent, Peter Thiel once said.
Speaker 1:What a great quote, and that's absolutely true. Better to have a little bit of negative press and a little bit of, you know, haters, than another nine eleven, for example. Whether or not Americans can agree on how and why to defend the country, Karp and Zamiska make a stirring call for the tech industry to follow Palantir's path and get involved in the effort the chicken finger delivery problem appears to be solved. I love that. He's just like, we don't need any more delivery apps.
Speaker 1:You guys solved it. You're good. You can come work on defense technology. You can come solve harder problems. Karp, an absolute dog.
Speaker 1:We love him on the show.
Speaker 2:Incredible line.
Speaker 1:Highly recommend going and picking up the book. I think I took it home actually. I'm gonna read it over the weekend. And the audiobook is also available, so you can go and download it, and you can, buy it and leaf through it. And interest
Speaker 2:have a great video
Speaker 1:We do. About carp.
Speaker 2:Yeah. We do. About carp.
Speaker 1:Oh, yeah. Go go repost that. We posted it on x. It's doing quite well. It's a lot of fun.
Speaker 1:We're doing more of these vibe reels, trying to liven up the timeline. Let's move on to society. Society says, no one does anything at no one does anything. So with just a little bit of effort, you can automatically join the top 20 of any activity or pursuit. I wrote an article linked below on how a few people even start as well, on how few people even start as well as some ways to enable extraordinary outcomes with marginally more effort.
Speaker 1:He calls it the dead planet theory, good Coogan's law, like the coinage. Interesting. Everyone loves to talk about dead Internet theory, but less often discussed is how few people do things in any venue or on any platform. This phenomenon is known by several names, including the power law, the Pareto principle, the example of this phenomenon is that 10% of Twitter users account for 92% of tweets. This dynamic can be seen in interpersonal relationships, hobbies, and careers.
Speaker 1:You can use this to quickly rise to the top or purely get a little more enjoyment out of the things you do day to day. In the scope of all creation, it can be hard to see the impact of this principle in action, but by separating things, events, and people by category and interest, it quickly becomes apparent. What do you think, Jordy?
Speaker 2:Yeah. I mean, you've it it feels this way all the time that especially as you start to get involved in any specific industry or pursuit, there are just not that many people taking it super, super serious. Right? Even within tech, like an example that's highly relevant to what we're doing, how many full time podcasters do you know in tech? Like, truly people that it's Lex, Dwarkash.
Speaker 2:David Senra.
Speaker 1:David Senra. Acquired FM. Yeah. Acquired. And then that's kind of it.
Speaker 2:And a lot of people are excited about
Speaker 1:projects, but they're not going full send on it. Yeah. %. Patrick O'Shaughnessy calls this, live players. How many live players are actually
Speaker 2:Patrick is arguably full time despite having Yeah. An investment, you know, for
Speaker 1:And and, I mean, he's a tech podcaster, but he's also a finance podcaster. Yeah. But still, he takes his craft very seriously, and that's instantly very it's it's rewarded him. He is at the top of his game. And a lot of that is because he just actually cares and goes after it in a way that a lot of people don't.
Speaker 1:And so when you see, yes, something is super competitive, but what happens if you actually go full tilt into something? Yeah. Can you be
Speaker 2:It's also exciting. You know, you can go do a new thing and if you focus on it for a few months to be able to get into the top 20% of that pursuit. Right? Yeah. If you've never played piano before, but you start playing for an hour a day Yep.
Speaker 2:You will be in the top probably 5% within a year of the entire world. Right? Maybe even more. Right? You could be in the top actually, the top 1%.
Speaker 2:Yeah. So it's a good good reminder to just do things.
Speaker 1:Yeah. And it goes to the inputs and outputs thing. Like, people focus on, like, I I wanna have a top podcast, but the input is just how much are you podcasting? How much time are you putting into that? Oh, I I wanna be in shape.
Speaker 1:Well, are you working out as much as the people that are in shape? Yeah. Just do the thing, and you will have the results.
Speaker 2:Yeah. And that's fitness is such a good example where the the guy on the beach that looks great, the guy or the girl or whatever
Speaker 1:Yeah.
Speaker 2:They could very well just be working out for thirty minutes a day, not even really trying, but they put in so many hours by nature being consistent.
Speaker 1:Yep.
Speaker 2:And even if they're not putting in effort of, oh, I'm making sure I'm having the perfect workout or perfect macros, just the nature of
Speaker 1:Yeah.
Speaker 2:That Consistency. You know, 10% of people at at the beach account for 92% of the workouts.
Speaker 1:You know? There's 10
Speaker 2:there's 10% of people
Speaker 1:Yeah.
Speaker 2:Look, fantastic and are sort of envied even though they're not having to put in that ridiculous amount of energy. They're just they're putting in a little effort consistently.
Speaker 1:Yeah. I love it. Well, let's go back to the car market. We talked about Ferrari earlier. Now we're talking about Jeep.
Speaker 1:Jeep owners are being hit with pop up ads inside their cars, and it's all part of Solentis' plan to make an extra $20,000,000,000 a year. And Pnorm has a great take on this. Pregnant wife is having contractions. Get in my Jeep to drive to the hospital. Forced to fill out a complimentary DraftKings parlay before it will start the engine.
Speaker 1:And this is the kind
Speaker 2:of content that you just can't get anywhere else
Speaker 1:Yep. You can't.
Speaker 2:Besides ads.
Speaker 1:It's really a black mirror. And, yeah, it is it is weird because it makes sense to monetize things that are, you know put ads in things that are
Speaker 2:Imagine being at the dealer. Entertainment. Imagine there's there's to me, there's nothing worse than paying for a product and still getting ads. Yep. Like, I I I think it's HBO Max right now Yep.
Speaker 2:That whenever I signed up for my account, I didn't have ads, and I hadn't used it in
Speaker 1:a really
Speaker 2:long time. I I logged in
Speaker 1:Yeah.
Speaker 2:To watch White Lotus last Sunday. And I'm like, why am I getting an ad? I I pay for this product. And it's and it's one thing if you're a substack and it's like an industry substack and you're paying for this, like, amazing investment of time into this, like, thoughtful analysis and they have a, like, a quick paragraph of an ad. I don't mind that.
Speaker 2:But paying if you're buying a car and people will definitely be in the dealership being, you know, saying, do you want the ad free model of this Jeep, or do you want, you know Yeah. Yeah. Yeah. Yeah. Are you okay with with ads?
Speaker 2:Yeah. And they're saying, oh, it's thousand dollar difference. I'll just take the ads. Yeah. And then, yeah, you're you're turning on your your AC, and you're getting a pop up.
Speaker 2:Yeah. I can't imagine the you know, but but from the advertiser or or for from an ad network perspective, Somebody's driving. It's kind of weird to flash an ad, but at the same time, they're probably They're
Speaker 1:seeing a billboard.
Speaker 2:They're seeing a billboard. Billboard. Yep.
Speaker 1:Yeah. Jeep. Hey. Maybe maybe just buy some billboards and then put them on ad quick, and that's your solution.
Speaker 2:Yeah. Yeah. Yeah. I would rather I'd rather see my ads outside of the vehicle.
Speaker 1:Exactly. Exactly.
Speaker 2:Yeah. And this is coming from guys that love ads more than
Speaker 1:We do love ads. But, again, the whole point of going with the ad model was that we weren't gonna make people pay for the content. So it was like, we we picked a business model and we're sticking with it. It's way worse when you tell you have a con you have a compact. You have a contract Yeah.
Speaker 1:A social contract with your customer that Yeah. Hey. This is how we're doing this. This the like, you go on Instagram, you're expecting ads, and Facebook has always been senator. We sell ads.
Speaker 1:And Yeah. If all of a sudden it was like, you pay and you get ads, it it gets very tricky. Yeah. X was in a little bit of that scenario for a while where you paid, and then there were still ads, and it was kinda Less ads.
Speaker 2:But now
Speaker 1:now I can pay, and I don't see any ads. It's fantastic. And, of course, if you wanna use it for free, you still can, which is great. Let's, let's move on to Matt Turk. He says, for any meaningful acquisition, you'll meet your future acquirer two to four years before the deal.
Speaker 1:Time to start building those relationships now. Little bit of wisdom from venture capitalist.
Speaker 2:Trung responds, hi. My name is Trung.
Speaker 1:Yes. He wants to merge in.
Speaker 2:Trung Trung Turk Inc. But, yeah, this is super smart. Even if you're competitive with your potential acquirer, meet the CEO, develop a friendship, if you're worried to get on a call with somebody because they're gonna get some info from you, you're probably not even competitive in the first place. So
Speaker 1:And it gets in
Speaker 2:the sense that you're just not even you're not even relevant.
Speaker 1:Yeah. Yeah. And my takeaway from this is, like, if you are a startup, do not think that you can run a successful acquisition process in the last three months of, you know, your cash out period after a fundraise fails if you haven't been building these relationships for a very
Speaker 2:long time. Be a fire sale.
Speaker 1:Exactly. As opposed to, hey. Actually, you know, we're we could do a round, but we're in a good place. We've been building this relationship for a long time. And, you know, we see that, hey.
Speaker 1:There are actually crazy synergies here. We're gonna get stock in this new company. Maybe I'll become CEO of the holding company. Yep. But, also, you know, the the the competitive dynamics are such that it makes sense to sell right now because, you know, there's too many other there there's not enough monopoly power.
Speaker 1:There's too many other players
Speaker 2:to stay. It's easier to get a big venture round done. Like, it's 10 times easier. Yeah. 50 times easier to get a big venture round done with on on a compressed timeline
Speaker 1:Yep.
Speaker 2:Than it is to go and try to sell your company Yep. And actually capture value.
Speaker 1:Well, speaking of selling valuable assets, the Bond franchise has sold to Amazon MGM Studios, and Jeff Bezos posted. I love that he's going direct. I love that he's given it to the fans. He says, who should we pick as the next Bond? And so, Alex here chimes in with, some interesting ideas.
Speaker 1:I wanna hear your take on this. The formula to revive classic Bond is simple. Cast Henry Cavill, obviously. Make it a sixties slash seventies period piece. That's interesting.
Speaker 1:Go back in time.
Speaker 2:I like that.
Speaker 1:Film is 100% plat practical effects. That's completely impossible now. They use CGI for everything. But, yes, you don't want it to mean, like, a Marvel movie, but you're obviously gonna be using set extensions in CGI for, like, little things here and there.
Speaker 2:Yeah.
Speaker 1:But in general, it's, like, stick to the actual explosions. Don't just CGI everything. Don't have him, like, breaking through massive buildings and going off into space. Keep it grounded. Devote a silly budget to finding and casting completely unknown but extremely hot brown haired actresses from European country.
Speaker 1:That's hilarious. But the Bond girl thing was legit. It was it was it was sensational. I grew up on that. Xenia Autotop, from GoldenEye.
Speaker 1:I don't know. What was the first power movie you saw?
Speaker 2:Wasn't born yet.
Speaker 1:GoldenEye. Score, the, source the score exclusively from GoldenEye 64. That's pretty funny. Allow Cavill to be a more ruthless male chauvinist. Like, get him like, like, really let him get in his Connery bag.
Speaker 1:It's usually because, like, Cavill is, like, a gamer. He's not, like, this, like, hardcore, like, hyper masculine guy.
Speaker 2:Could be a gunslinger, though.
Speaker 1:But but I but I do think that if you go back to the old, to the old Bond films, they were satires. And people don't remember this, but, what killed Bond was, Austin Powers. Are you familiar with this? Do you know
Speaker 2:Austin Powers? I didn't know I didn't know there was a
Speaker 1:So so the early Bond films were deliberately over the top, and they were supposed to be funny. They were supposed to be making fun of more serious spy movies.
Speaker 2:Yeah.
Speaker 1:And so in the movies, you'd be watching and Bond would, like, sleep with a woman in the opening, get out of bed, and be like, okay. I gotta go do a job. Then he'd sleep with another woman in the in the act two, and then he'd wind up leaving the exploding fortress with another girl. And it was like, that's a lot, guys.
Speaker 2:Over the top.
Speaker 1:This is over the top. And there were a lot of things where it's like, I expect you to die, mister Bond. Like, it was it was totally, like, theatrical, and that was supposed to be satirical. But then Austin Powers came in, and they were like, no. We're the satire.
Speaker 1:And so Bond had to respond by being even grittier and even more serious, and it lost some of its charm. Anyway, what were you saying?
Speaker 2:I posted something yesterday, this funny quote, with a over the top picture of Blake, PMF or Die Oh, yeah. Player, from an old Bond line. The distance between insanity and genius is only measured by success.
Speaker 1:Exactly. It's There's so
Speaker 2:many great lines, and there's forums dedicated just like what's the best James Bond villain line.
Speaker 1:Exactly. And so we think of that as funny now because we're like, oh, it's so funny in in the modern context. But Yeah. The guy who wrote that thought it was funny too. They thought that was funny back in the sixties and seventies.
Speaker 1:It wasn't some, like, oh, they're just super serious. They had a sense of humor as well. And so Yeah.
Speaker 2:It's interesting there's so much you can imagine a Bond movie if they took generally this approach
Speaker 1:Yep.
Speaker 2:Coming in and being the first, like, meaningful blockbuster outside of Dune Totally. Where we are texting our absolute boys saying
Speaker 1:Let's go. If you're
Speaker 2:not in LA, get to LA. We're suiting up. We're headed to the cinema.
Speaker 1:Yep.
Speaker 2:No women allowed. Just just
Speaker 1:Ridiculous. But, yeah, I mean, a lot of really bomb stuff. It got it got paid to show this.
Speaker 2:To just go to the movies with
Speaker 1:your boys. Satirizing chauvinism, which is something it's the same thing with Starship Troopers. People think of Starship Troopers as, like, a fascist movie. In fact, it's making fun of fascism. And so, the subtle subtle satire has really been lost, and I hope that they can bring that back with a new James Bond movie.
Speaker 1:But let's break down the deal. There's an article in the, Wall Street Journal here. Again, front page of the finance business and finance section. Amazon MGM Studios to steer Bond franchise. The, the Broccoli family feud with Amazon MGM Studios over the James Bond franchise appears to have reached a resolution.
Speaker 1:Barbara Barcoli and her stepbrother, Michael Wilson, who have long controlled the double o seven franchise, said in a statement with Amazon MGM, Thursday, that they reached an agreement to hand over creative control of it to a new joint venture with the studio. The venture will house the franchise's intellectual property rights. Amazon will now control who will play Bond, who will write the next script, and when the film goes into production, three critical pieces that so far have been held up by a years long stalemate. And that's why we haven't seen a new Bond film in a while.
Speaker 2:Random, but I would love to understand how the deals work between the James Bond franchise and Aston Martin. Because the Aston Martin is the obvious car. Yeah. That's such a James Bond car, but you can't imagine that the James Bond franchise would say, yeah. We're just gonna slot it in for free.
Speaker 2:Totally. It's so import such important marketing for Aston Martin.
Speaker 1:And it's the same thing with Omega. So in the original books, James Bond wore a Rolex, but then Omega came in and did the deal for product placement. And so the Bond watch for the last, like, forty years has been Omega. And so they continue to invest in that relationship because even though they have to pay every single time, it drives sales. And so it just it just works out.
Speaker 1:And so it's a little bit trickier.
Speaker 2:Why Mark Hendrickson bought his Omega.
Speaker 1:Many people think of him as the James Bond of venture capital, for sure. Who do you pick as the next Bond? Jeff Bezos asked. Amazon and Broccoli family have been at odds since the tech company acquired the right to release Bond movies about three years ago when it bought MGM for 6,500,000,000.0. After the deal, the Bercouli family retained their power to decide when a new Bond movie could go into production.
Speaker 1:The family didn't trust the data minded Amazon with its character, and the parties couldn't agree to a path forward for a new film, The Wall Street Journal previously reported. The impasse meant the franchise has hasn't moved any closer to its next installment. No Time to Die debuted in 2021. The franchise typically released a film every year or two starting with Doctor No in 1962. There were rarely long gaps in between installments.
Speaker 1:We're honored to continue this treasured heritage and look forward to ushering in the next day.
Speaker 2:Calder Calder in the chat has a good point. He says, Cavill is not a good pick. Bond needs to be unknown, lest everyone sees them as their former roles. Daniel Craig was a Shakespeare actor before Bond.
Speaker 1:And he had been in, layer cake, but that was very, like, cult classic.
Speaker 2:Yeah.
Speaker 1:And he plays kind of a Bond esque figure. So, yeah, I agree because Henry Cavill, he's Superman. He's also in that other spy movie, the man from UNCLE. Yeah. Not a huge franchise.
Speaker 1:And then he's also the Witcher guy. And so you think about
Speaker 2:I'd like to see John Theo cast as, cast as the next James Bond. You know? The cool bachelor with the Ferrari.
Speaker 1:Yeah. Yeah. Get him in Austin. Yeah. You know, maybe maybe upgrade a little bit.
Speaker 1:We'll see. Anyway, if, pop quiz, if, James Bond pulled out a credit card, what credit card would he be using?
Speaker 2:Ramp.
Speaker 1:Absolutely. Go to ramp.com. Time is better to say both easy to use corporate cards, bill payments, accounting, and a whole lot more all in one place. Maybe that will be good for your social ad.
Speaker 2:Everybody that's listened to this, more than one episode of the show knows that we're trying to make the show better every single day. Yep. And I've been trying to think about why is the show better today. Yep. And it's because you're just nailing the ad intros
Speaker 1:Thank you.
Speaker 2:John. So we're not focused as much on the content today as much as the
Speaker 1:I think the content's the best. No.
Speaker 2:No. No. I'm just saying, but sometimes you gotta I gotta I gotta recognize your
Speaker 1:Oh, thank you.
Speaker 2:Nailing the transitions. I appreciate that. And,
Speaker 1:doesn't go unnoticed. Post here from where the ramp official axe account. CFO who's not on ramp. How did you spend $76,769 on the company card in a single day? That one rogue sales guy, a private jet, and it's a post from a Amalfi Jets TikTok.
Speaker 1:And you know what? That's the beauty of Ramp. You can set your expense policy however you want. And for certain businesses, you want your sales guys chartering jets. If you're doing the deal with Masa, you better you you bet that they can expense a pair of private jet for that, and it's gonna pay off.
Speaker 2:Yeah. OneNote today, you logged into Ramp, and you said, how do we spend this time? We just and then we just looked through, and we could see exactly how it's all spent. It's it's great.
Speaker 1:Yeah. It's all watches and cars and Yeah. The usual jets. But that's why we do this.
Speaker 2:Add quick billboards.
Speaker 1:Exactly. Let's move on to, some interesting stuff going on in China. The Chinese m one money supply Okay.
Speaker 2:So I was waiting to see something like this because Chinese stocks are ripping Yeah. And biased analysts are saying, oh, the Chinese, on Yeah. And you got the GameStop guy going long Yep. Into Alibaba. Yep.
Speaker 2:So, yeah, apparent when you when you massively increase your money supply, equities rip.
Speaker 1:And so I wanted to know this is obviously very controversial because a lot of people are China haters. A lot of people have bags in Chinese companies, and so it's hard to get an exclusive or an, an unbiased view. So I asked Gurok three to summarize it. We'll see how they did. Here are 10 bullet points explaining, what's going on in China.
Speaker 1:They boosted their their money supply. The cut they cut the reserve. They cut interest rates by 50 basis points, and they released a hundred and $42,000,000,000 to stimulate lending and growth. The GDP growth has been pretty good 5% last year. This met the government's target but relied heavily on stimulus and exports.
Speaker 1:And so there there's still a little bit of fragility in the economy. Now they have a property crisis going on. New new housing starts fell 23% in 2024 with home prices down 30% since 2021. That's rough. Like, that is almost great recession level in The United States.
Speaker 1:A lot of people had million dollar homes. They sold them for 700 k.
Speaker 2:Yeah. And and people don't realize the the Chinese stock market is not as accessible as it is in The US. The government wants has historically want like like, a housing has been seen as the safe, most best place to park dollars.
Speaker 1:And they're obsessed with with with savings over there.
Speaker 2:And it's interesting too because these houses there was this cult there's a culture in China where a home that's been lived in is not worth as much as a, as a home as a new home that Yep. And so people will buy a property and just have it sit empty so they're not even earning yield. Yep. And so for it to not be a total waste, they're betting on it increasing in value. And now people have stopped moving into the cities broadly
Speaker 1:Yep.
Speaker 2:So that there's actually an an outflow in in some regions.
Speaker 1:Yep.
Speaker 2:And that's just causing house prices to plummet, which is just creating all these other issues.
Speaker 1:Yeah. And so the stock market is also down. They've lost 6,000,000,000,000 over the last three years. Consumer spending remains low. Retail is sluggish.
Speaker 1:We've seen this in the Apple data, but we've seen it in all
Speaker 2:No. If you look at it too. Caring group sales is down 30%.
Speaker 1:Do they own Hermes? Is that right? Or
Speaker 2:They own Gucci.
Speaker 1:Gucci. Okay. Yeah. And so, yeah, at the top of the the higher income, Chinese populace, they're certainly saving more money. There's also deflation risks going on.
Speaker 1:The the the the Bank of China is trying to inject liquidity, but credit growth is still slow. There's a population decline. I didn't realize this, but the population shrank by 1,300,000 last year.
Speaker 2:The official numbers, which nobody actually
Speaker 1:People trust people don't know.
Speaker 2:The other thing is is generally the CCP, you know, people can point and say and say, you know, the CCP has plenty of critics. The CCP has always been able to say, we're lifting people out of poverty. We're improving the average quality of life of our Yep. Citizens, so shut up. Yep.
Speaker 2:And then as that starts to erode and maybe that narrative the narrative just generally starts to erode, it's it becomes harder. You know, they're they're sort of, as much as any sitting White House wants to make the economy great. Yep. CCP, in some ways, their power is built around the ability to continue to deliver.
Speaker 1:They have to. Economic growth is the opiate of the masses over there. And if you don't have economic growth as an opiate of the masses, you need a different opiate of the masses. Yeah. Whether that's brain rot TikTok or drugs or whatever else you you're like there will be a revolution unless there is something that, appeases the populace and makes them think, I'm I'm happy.
Speaker 1:I'm living a good life. And so, yes, you're right. There's there's a lot of, mixed signals here. Official data highlights growth, but independent analyses emphasize structural issues like overcapacity and weak demand. And, some forecasts now, predict that China could grow, the the growth could drop to three percent annually in the medium term, and then they're growing, you know, in line with The US.
Speaker 1:Everyone was expecting 10% forever. They're gonna destroy the America, but, it's unclear how much they can prop this up. The government is just putting a 1,400,000,000,000.0 fiscal package over five years, to prop up the economy. And so you can only do that for so long. What we're gonna say?
Speaker 2:And so there's an article in Fortune in 10/17/2024. Their Swiss watch exports fell off cliff because the Chinese demand had dried up. So And
Speaker 1:it's not anytime Yeah.
Speaker 2:Any, you know, it's it's you could you could argue, that, like, just looking at luxury goods demand is just a sign as as, you know, they're they're not their their status oriented purchases Yep. Those are some of the first to kind of stop Yep. When,
Speaker 1:And they do have are not as great. China does have a a mechanical watch brand natively, but that's not what's killing Patek sales in China.
Speaker 2:Yeah. Yeah.
Speaker 1:It's it's actually
Speaker 2:surplus or if you have if you had 20 apartments
Speaker 1:Yep.
Speaker 2:Somewhere and you thought you were doing great and then I don't know. You they're all down 30% and you still have, you know, the the thing the thing about a a home, if somebody purchases a house Yep. Puts down 20% and then the value of it declines 30% Yep. Is terrible Yep. You know, spot to be in.
Speaker 1:Well, I thought that was a pretty good analysis by Grok. I like those facts. I like that it boil it down that that easily. That actually works for me.
Speaker 2:And the thing with the thing with China and these Chinese, Chinese companies Yep. Like DeepSeek is there's no reason that you should trust the data. I think you should always be skeptical of of somebody putting out data and saying this is 100% the truth. Right? Because sometimes, you know, it's difficult to get the numbers right.
Speaker 2:But over and over and over, Chinese companies have lied. Yeah. Especially when speaking, to, you know, American media. And, you know, many people would argue that the Chinese company is, like, really massaging the numbers around a lot of economic data in in the same way The United States does too. Right?
Speaker 2:Like, we are guilty of that as well. You see this in in jobs reports where, oh, jobs, you know, like, you know, their employment is is, unemployment is down, but it's actually like a bunch of DoorDash workers.
Speaker 1:Or people dropping out of the labor force entirely, not even applying
Speaker 2:jobs. Yeah.
Speaker 1:And, like, not a good signal for your long term health and your economy. Well, I like that. Gabby Goldberg is also liking Groc three. She says Groc three is very, very good. Lots of people sharing this sentiment, especially on acts.
Speaker 1:People are enjoying it.
Speaker 2:I think I think what what you what you hit on earlier in the show is that it's a very differentiated product
Speaker 1:Yes.
Speaker 2:By almost having some memory of what you're interested in. Totally. And some idea of the ideas, the people, the companies, you know, brands, etcetera, that are relevant to you and the stories that are relevant to you. Like, claw if you talk to Claude, it's not going to surface that you talked about f one last week. Yeah.
Speaker 2:Right? And
Speaker 1:also the easy entry points, like, we'll go to this next post, but you can just click the XAI button and say, tell me more about this post. Yeah. So I didn't do that exactly for this, Chinese m one money supply post, but I probably could have clicked this to start my interaction and said, hey, Grok. I wanna go deeper here. Give me the data.
Speaker 1:Pull it all together. And so, yeah, pretty good product and an interesting product. They're taking risks, which I think I like to see on the product side. So tech sales guy says, so what's it like being in tech sales? And there's a and there's a iMessage back and forth.
Speaker 1:Hey. Is this Timothy from Clever? Hi, Matt. Yes. It is.
Speaker 1:Cold call me again, and I'll ruin your entire quarter. A hundred k likes. People are getting sick. You gotta be good if you're an SDR.
Speaker 2:This had a yeah. Hundred k likes. Crazy.
Speaker 1:It hits.
Speaker 2:People are sending me
Speaker 1:phone calls.
Speaker 2:I try to be really kind to salespeople Yep. Because I respect the dollar, and I respect the work that they do. Yes. I respect that they're trying to put food Yeah. On their, on their table, just doing their job.
Speaker 2:I definitely try to be I'm just, like, thank, you know, thank you for calling. I actually don't have time to talk right now. I thought this was someone else. You know, feel free to email me and I'll get back to you.
Speaker 1:Yeah.
Speaker 2:But, be nice to salespeople and it'll come back around.
Speaker 1:Yeah. I actually have a text replacement on my phone. I wonder if it's still active. But basically, text replacement. Let me see if I have this d n no.
Speaker 1:I I don't have it anymore. But I used to have a, I used to have a, I guess, a shortcut where if some if I got a cold email from someone who's clearly just added me to some list and they're gonna clearly email me, like, 10 times to try and solve it, something that I didn't want. Instead of saying, like, hey. Cold call me again. I'll ruin your whole quarter.
Speaker 1:Like, that's very aggressive. I would still be very clear, and I would say, hey. Like, I'm not in the market for this product. No one at my company wants to buy this. We're happy.
Speaker 1:Please remove me from your CRM. Remove everyone at my company for our CRM, and just never contact us ever again. And it's very aggressive, and it's but it was, like, nicely worded. It was, like, good luck with your business. Like, but I don't want any I don't I don't want any inbound from you at all.
Speaker 1:And it was and it was worded in a way that was, like, it was firm, but not mean. And I think I glanced it correctly. And it really did help clean up my inbox, so I wasn't getting as much cold inbound, which is important. But it's gonna get worse with AI and all these AI SDRs. Let's go to Atlas creatine cycle.
Speaker 1:He says no one believes in AGI anymore. By the way, you're all keeping your jobs, and GDP growth will continue ticking up in the one to 3% range for the foreseeable future. It was all a prank by big poster to sell more engagement. Let's go. What a great post.
Speaker 2:You gotta watch out for big poster. Yeah. They will sell you a dream to drop the
Speaker 1:numbers. Totally.
Speaker 2:They will get you.
Speaker 1:They will get you. Well, speaking of big poster, there was a viral, debate on x yesterday about whether or not Trump was getting rid of the Presidio. Did you see this? So there's an executive order. The Presidio was named.
Speaker 1:People said, oh, The Presidio in San Francisco is gonna be gone. And Trey chimes in to clear up the confusion. Trey Stevens over at Founders Fund, and Andoril says, I've worked in the SF Presidio for the last eleven years. It is an amazing refuge from the insanity of SF city governance. Because if you don't know, The Presidio is federal land, and so it's not subject to this SF city governments even though it's, like, directly in San Francisco.
Speaker 1:He says, all this freak out about The Presidio being eviscerated, SF Chronicle, or abolished to the SF standard is completely unhinged. The Presidio is revenue generating and completely self sustaining. The executive order is aiming to cut waste in non statutory spending, a good thing, which shouldn't impact an efficiently run organization funded by its own revenue. So if you're in the Presidio, you pay, and that revenue goes towards the services that are provided in the Presidio. It's kept very clean.
Speaker 1:He says, everyone, relax. Also, we should take the profits from the trust and build a new colossus statue on Alcatraz, which I love. Yeah. The Statue Of Liberty on the East Coast, the Statue Of Justice on the West Coast, reopen Alcatraz. I think it's a great idea.
Speaker 1:What do you think?
Speaker 2:Alcatraz, as a kid, do you do you have any memories going around on on the, like, the ferry or boats around Yeah. Alcatraz? Yeah. I used to not it was so funny because I as a kid, they would tell you there's no prisoners in here. Yeah.
Speaker 2:But I didn't quite believe them. Sure. Sure. Yeah. You're just saying that.
Speaker 2:Yeah. Like, I didn't want I was I would I remember my first tour of Alcatraz being, like, freaked out.
Speaker 1:Yeah.
Speaker 2:Being like, are we really gonna go here? I mean There's all these bad guys.
Speaker 1:Conspiracy theories are so fun. Like, at Disneyland, if you get lost, they'll make you go on It's a Small World, and they'll turn you into one of the Small World kids. Did you ever fall for that one? That that was big amongst, like, the six year olds.
Speaker 2:You know, we we remember I sent you that post? There was a bunch of, like, eight year olds talking about they're on a podcast talking about pizza. Yeah. We need we need a somebody should do a podcast, Kid Conspiracy Theory.
Speaker 1:Kid conspiracy theories.
Speaker 2:Can dogs really not speak English? Yeah. Because when I say, you know Yeah. Come, they come.
Speaker 1:Or, like, wait. If I How
Speaker 2:do we know they don't understand all
Speaker 1:If I stay up past ten tonight, I'll turn into a pumpkin? Like, that can't be true. Right? And it's like, no. No.
Speaker 1:I I I heard that from my parents too.
Speaker 2:My cousin said he Yeah.
Speaker 1:My cousin said that happened. It it was real. Yeah. Yeah. It's real.
Speaker 1:Yeah. Kid conspiracies are great. One of the best ads for Alcatraz, The Rock with Sean Connery. Have you seen that movie? You haven't seen any movies.
Speaker 1:It's fantastic.
Speaker 2:Seen any movies.
Speaker 1:You gotta watch that. That if it if that goes back in theaters, we gotta we we gotta take the guys to see it. It's fantastic. Nick Cage, Sean Connery, they he's a former prisoner there. There's a there's a a bunch of, like, rogue agents that take over Alcatraz.
Speaker 1:They're gonna launch a missile, and so he has to take a seal team six to go in and break.
Speaker 2:It's amazing. Speaking of cinema, there has to be, like, a decent business to build, basically making a one room cinema that just all just perpetually plays the classics.
Speaker 1:That's pretty cool. Yeah.
Speaker 2:And when you think about it, I mean, maybe those exist. I'm sure they exist around LA, but nobody's made this sort of, like, franchise sort of, slightly retro fun cinema experience, and we would certainly be weekly active users of that
Speaker 1:For sure.
Speaker 2:Showing up in a talks.
Speaker 1:I think it exists, a nice wander somewhere potentially. Yeah. But let's move on to another ad from AdQuik, out of home advertising made easy and measurable. If you need to run a billboard or out of home campaigns for your company, we recommend AdQuik. Say goodbye to the headaches of out of home advertising.
Speaker 1:Only AdQuik combines technology, out of home expertise, and data to enable efficient seamless ad buying across the globe. And, they, they recently are we're promoting another podcast from them. On a recent episode of the Madvertising podcast, we asked, Jantheney Long how how how young founders with large ambitions should approach building their brand during the early days. So if you wanna hear about that, head over to their ex account and listen to that clip. Anyway, let's move on to DeepSeek is free falling in the charts.
Speaker 1:Meanwhile, ChatHQ
Speaker 2:is skip one?
Speaker 1:Yeah. Do you wanna do the Letnick one?
Speaker 2:I just wanted to do this because I think it's, I I I just wanna prepare the audience that thirty years from now, we will eventually pass the torch to our sons.
Speaker 1:Yes.
Speaker 2:And we you know, there's gonna be an announcement. We're gonna say that, you know, our our little lads are taking over the family business Yep. And, get used to some new, you know, hosts. Faces around here. You know, eventually, we're gonna pass the torch, and I think people should just honor that, respect it.
Speaker 1:So Howard Lutnick is an incredibly inspiring entrepreneur. Are you familiar with this? He built Cantor Fitzgerald. The firm was destroyed in 09/11. They lost 60% of their headcount in in the in the terrorist attacks.
Speaker 1:He was spared because he was dropping his son off at school. He just got very, very lucky, rebuilt the firm, and now his two sons, how age 27 and 28 are going to be running Cantor Fitzgerald because Howard Lutnick is stepping into the Trump administration.
Speaker 2:Yep.
Speaker 1:And so, flexed up first year says, imagine going from a sales and trading analyst in April of twenty two to chairman of your bank at age 27. That honestly rocks. Now you forget that Howard Letnick was, making a million dollars a day at Cantor Fitzgerald pre 09/11, at age 40. And so he's gotta look at this and be like, yeah. 27.
Speaker 1:Like, I was 27 when I was running this company. Yeah. You can do it. So I love it.
Speaker 2:And the thing, you know, people, nepotism, you know, got attacked quite a lot even though historically, it's sort of the norm. Yeah. And what people don't realize is that growing up, absorbing Yeah. Constant, you know, twenty four seven exposure to an a incredible entrepreneur Yep. Even if you end up 50% as good as your dad, that's still way, way, way better than the average.
Speaker 2:Yep. So Yeah.
Speaker 1:Huge fan. Huge fan.
Speaker 2:I think it's, overall, it's cool. I mean, obviously, they're gonna have to get in there and perform. Yep. He's not you know, I'm sure that you you don't become Howard Lutnick and then let your sons run the business into the ground. He will.
Speaker 2:As fast as he put you in, I'm sure he'll pull you out if you're not, delivering results. So
Speaker 1:Yeah. But good luck to them. So let's go to Rajvir. He says DeepSeq is free falling in the charts. Meanwhile, ChatGPT has maintained a top 10 position for nearly two years.
Speaker 1:Surely, all the Think boys will update their hot takes from a month ago.
Speaker 2:Okay. So Raj is particularly qualified here because he's gone number one in the App Store. He sold NGL, got 250,000,000 downloads. He's actually who introduced me to Blake Anderson
Speaker 1:from
Speaker 2:Came Ever Die. Wow. And, anyways, so, we everybody was calling this. They were clearly just spending to drive this growth and potentially botting the growth.
Speaker 1:Yep.
Speaker 2:And I would imagine DeepSeek has not been getting sign ups.
Speaker 1:Yep.
Speaker 2:And it's a money losing operation right now. And and, I'm, you know, not surprised to see this, and, but I'm quite pleased.
Speaker 1:I like it. I'm gonna skip the next one and move on to exoskeleton presented by General Electric in 1967. F o f r says, makes sense why he was called General Electric now. It does sound like, you know, a Marvel villain or something. But what a cool project really shows you that g GE was on top of the game back then, just building crazy stuff.
Speaker 1:And, you know, you see this trend at companies today and you can identify them. And, you know, a lot of a lot of the historic, power law companies have kinda lost their luster. But looking back at photos like this remind you that, how cool it is to be a a, you know, hard tech company that can just build things and test things. And Yeah. Obviously, this project didn't go anywhere.
Speaker 1:But, you you can see this picture and in one image immediately understand what the culture was like at that company. Totally. It was probably rocked. It was probably rocked. Anyway, let's go
Speaker 2:to the back and study these companies more. Yeah. Yeah. When we have a single day without onslaught of headlines, we'll go back and
Speaker 1:we'll Yeah. Yeah. Yeah. We need to bring in more of the historical deep dives Yeah. From time to time, at least once a week, do one.
Speaker 1:Yeah. Get a book, get a get an analysis, and and take you through. I mean, the history of GE is probably fascinating. Fascinating. Yeah.
Speaker 1:I know very little about it, so it'd be it'd be great to go through. Eric Jong over at x a I says, this is what cooking 200 k GPUs looks like. Elo scores on chatbot arena. He's very proud of chocolate early groc three.
Speaker 2:Absolutely crushed in the way. Everybody loves chocolate.
Speaker 1:Does love chocolate. Beat out Gemini two point o Flash Thinking and Gemini two point o Pro. And I think people were a little bit, debating how how legit this was because now with test time compute, you can throw a ton of inference cost at it and basically do a, consensus. You generate the same results, like, hundreds of times, and then you see which ones the model thinks are best. And so it's more expensive.
Speaker 1:This is what Yeah.
Speaker 2:But he's saying he's throwing 200 k GPUs at Yeah. So is he being dishonest?
Speaker 1:Yeah. If And and if the inference cost comes down, why not do that? Dylan Patel was joking about
Speaker 2:Or why not just do it to prove what you're capable
Speaker 1:of doing? In the future, I want a Roomba that has a thousand PhDs inside of it working to decide what next particle of dust I should pick up.
Speaker 2:There you go.
Speaker 1:And the inference should be millions of human years calculating what Just at once. Where the dog fur is to pick it up. And and that's fine. And I love that. And I think that's very funny that I
Speaker 2:I want a robot that's looking at the biggest tree in my yard Yes. And and just predicting
Speaker 1:Which which leaf will
Speaker 2:fall next. Which the leaf to fall next and just reaching up and grabbing it.
Speaker 1:Exactly.
Speaker 2:I don't even want it to actually, no. Let it fall Yes. Until it's, like, an inch below the ground and catch it like you're an NFL microcepter.
Speaker 1:Yeah. And, yeah, I mean, if intelligence is too cheap to meter, why not? Yeah. But, yeah, I mean, congratulations to the x AI team. It must be awesome to be at the top of the Elo scores and also taking a bunch of risks on the product side, which we love to see.
Speaker 1:So good stuff. Always fun to follow the, the AI chatbot arena. They're duking it out, and good luck to them. This was fun from Dan McCormick. Joe Rogan is obsessed with create creatine gummies.
Speaker 1:Joe Rogan was pitching Magnus Carlsen and millions of listeners on creatine and more specifically creatine gummies from Create. Surreal. It's a one minute clip.
Speaker 2:So, Dan, for those that don't know, insane, insane growth marketer. He's also the brother of of Packy McCormick and has helped out on Not Boring quite a bit. Yep. He had this idea to build create a creatine gummy brand forever ago. Mhmm.
Speaker 2:There's something about humans where if you put something in a gummy, they want 10 times more of it. Oh, yeah. So he identified that. He I I initially I I think he sent me the deck or something like that, and he had this theory that that gummies would be the way that women got into creatine.
Speaker 1:Sure.
Speaker 2:And I totally didn't believe it because as, like, a bro science bodybuilder, you know, interested type, person. Right? I had always associated Creatine with putting on MASK, but it has all these other benefits. And so I ended up not investing because I just thought the thesis was was wrong even though Dan's amazing.
Speaker 1:Yeah.
Speaker 2:And then he got it to such a ridiculous run rate in, like, four months. I was like, okay. I was wrong. I'm gonna invest. And, and he's since, you know, doing tens and tens of millions of revenue It's great.
Speaker 2:Profitable, you know, has done very, very well. So, awesome to see.
Speaker 1:Yeah. Yeah. The the the the most, like, bro science explanation for why creatine is important that I liked was, you know, it helps you put on water weight. That's what everyone says. It it hydrates your muscles.
Speaker 1:But the the hot take there is that being hydrated is good.
Speaker 2:Yeah.
Speaker 1:And so, you know, if you have more water in your body overall, in your brain, in your muscles, everywhere, you will just feel better. You'll perform better. And that's, like, kind of as basic as it gets, which I thought was an interesting, like, distillation. I'm sure there's a lot of scientists that would give you a much more complicated explanation for what's going on, but that that that simple explanation was actually, kinda stuck in my mind. Anyway, let's move on to some, oh, we gotta ring the size gong before we head out for the day.
Speaker 1:Together AI raises $305,000,000 series b at a $3,300,000,000 valuation. Today, we're announcing a massive series b led by General Catalyst. Incredible to see the team, belief in open source models and their ability to empower choice for AI developers continue to be rewarded, excited for this next chapter, says Lee Jacobs. So Let's ring a Saigon event.
Speaker 2:Saigon, gotta give some credit to Lee, Justin, Cyan, the team at Long Journey. They've been on an absolute terror. They were early in Crusoe. Right? And then that they were also super early in it together.
Speaker 2:Yeah. And, it only takes a couple companies like that and a fund to, you know That's great. Get into the, the carry zone
Speaker 1:Yeah.
Speaker 2:Which is always a goal. So great work.
Speaker 1:Another big AI round, more on the model delivery level.
Speaker 2:Yeah.
Speaker 1:Really betting on open source, choose your model, vend it into different enterprises, but excited to see where the product goes and where the team builds with that huge stack of cash.
Speaker 2:Well said. Lots to do. So The last?
Speaker 1:Yeah.
Speaker 2:The last thing I mean, we got to I mean, we're still we're streaming. You we both probably have to go home, but there's two things. One, I wanted to shout out Rob at Huberman Lab. He just sent a bunch of Matina to, he sent it into the cage. Yeah.
Speaker 2:The the boys are very jacked up on Yerba Matez.
Speaker 1:Great.
Speaker 2:And then the second thing, I don't even know if we can pull this up now, but one x just announced a new, humanoid robot called, you know, literally while we were streaming, called the Neo Gamma
Speaker 1:Mhmm.
Speaker 2:And saying they're saying it's one step closer to home. So they're targeting the home market. Yep. Figure seems is building general purpose robots, but more oriented around, BMW manufacturing. Manufacturing, like, labor.
Speaker 2:Yep. And I think one of the companies are trying to
Speaker 1:horror films, I guess.
Speaker 2:And, these things look still super, creepy, almost like Black Mirror esque. Yeah. But, I like how they're comparing they're even almost comparing the product to SMEG, which is like a sort of classic kitchenware brand. Cool. But, the visuals the visuals in this are are amazing.
Speaker 1:Yeah.
Speaker 2:And Looks friendly
Speaker 1:for sure.
Speaker 2:You were yeah. I think we're looking forward to a world where we can Yeah. Have one of these walk over and hand us, you know
Speaker 1:Bottle of dump.
Speaker 2:Your Vermont a bottle of dump. I'd love to see a humanoid robot pop a Dom bottle of Dom. Champagne.
Speaker 1:Yeah. That's the real test of AGI. Can you saber a bottle of Dom effectively?
Speaker 2:Can you really savor it?
Speaker 1:Saber. Saber. Like, use the use the saber of the sword to pop off the top. That's the way you open it if you're really, really on it. We we we gotta do that for the dominant practice.
Speaker 2:The last thing the last bit of news before the weekend, Hooters is preparing for bankruptcy. We didn't cover that, but maybe we'll cover it Monday because
Speaker 1:it's a bigger story. I don't know how I feel about it. I've never been, so I don't really know.
Speaker 2:I've never been, and there's tons of arguments that it's probably a good thing even though maybe that same human instinct just moved online.
Speaker 1:Seems low class and vulgar.
Speaker 2:Sounds vulgar to me, but
Speaker 1:I'll be sticking to nobody.
Speaker 2:Like it's the weekend.
Speaker 1:Yeah. It's the weekend.
Speaker 2:Does it feel like the weekend?
Speaker 1:Yeah. Starts to
Speaker 2:feel like the weekend.
Speaker 1:You'll be hearing from us on Monday. In the meantime, think about leaving us a five star review on Apple Podcasts and Spotify. And when you do, put an ad for your company or a company you love in the description. We'll read it live on the show.
Speaker 2:I didn't know this, but you can comment on Spotify.
Speaker 1:Okay.
Speaker 2:So feel free to leave an ad in there.
Speaker 1:Add in your comment. Why not?
Speaker 2:There's a bunch of
Speaker 1:Anything that pumps us up in the algorithm, we appreciate. Follow us on x. We'll be live streaming over there soon.
Speaker 2:And we'll be doing a Dom episode next week when Ben Fantastic. Gets his wisdom teeth out.
Speaker 1:Fantastic.
Speaker 2:Anyways, great week, brothers.
Speaker 1:Thank you.
Speaker 2:Thanks for watching.
Speaker 1:Thanks for listening and watching.
Speaker 2:We'll see you Monday.
Speaker 1:See you Monday. Bye.