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Josh:
Three of the largest IPOs in history are filing within weeks of each other.

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Josh:
We have SpaceX, OpenAI, and as of just this week, Anthropic.

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Josh:
And on that same day, Google raised $80 billion of outside capital to fund its own AI buildout.

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Josh:
Now, the interesting part here is they're partly funded by each other's money.

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Josh:
Everyone is contributing to the other person's balance sheets.

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Josh:
And we've even gone so far as in the last few weeks to change the rules protecting

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Josh:
passive investors about how they can invest in IPOs.

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Josh:
The biggest buildout in the history of

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Josh:
capitalism is currently happening and we have

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Josh:
to ask the question is there enough money

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Josh:
like clearly there's a reason there's correlation as to why each

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Josh:
one of these companies are choosing to go public all around the same time and

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Josh:
this chart that we're sharing on screen here is pretty incredible i mean between

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Josh:
open ai anthropic and spacex the total amount raised during ipos is going to

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Josh:
be 180 billion dollars that's more than the entire dot-com bubble combined at 164 billion dollars.

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Josh:
That's three years versus three IPOs. So the scale of this is huge.

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Josh:
And I mean, we have to answer a few questions. Is this a circular economy moment?

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Josh:
Are they running out of money? Have they outgrown private capital?

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Josh:
There's a lot to talk about here, Ejaz, I guess, starting with SpaceX.

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Ejaaz:
Yeah, so you've got SpaceX open-air and Anthropik. They're having blockbuster IPOs

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Ejaaz:
The story isn't really about like each of them individually.

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Ejaaz:
It's the fact that they're all happening potentially within weeks of each other.

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Ejaaz:
They're all targeting like by latest a Q4 IPO and the combined raise is absolutely

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Ejaaz:
massive. We haven't seen anything like this before.

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Ejaaz:
So if we break down like what we've seen so far, we had SpaceX,

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Ejaaz:
I think it was April 1st that filed for

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Ejaaz:
their S1, which basically is their proclamation that they intend to IPO.

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Ejaaz:
I think they're targeting around an IPO sometime either this month or at least

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Ejaaz:
early July. That's what the rumor is. are saying right now.

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Ejaaz:
And then 10 days ago, we had OpenAI reportedly confidentially file their own S1 for their own IPO.

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Ejaaz:
And then 10 days later, aka yesterday, Anthropic filed for their confidential

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Ejaaz:
S1, which means that now all three of these companies are going for blockbuster

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Ejaaz:
IPOs within potentially weeks of each other.

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Ejaaz:
And so it begs the question, why is this happening now? Why such a rush?

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Ejaaz:
The answer to me is pretty simple.

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Ejaaz:
The AI CapEx build-out is becoming costlier than any of these companies could

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Ejaaz:
have expected, and they've decided to lean in.

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Ejaaz:
They've run out of free cash flow. Up until this point, all of these companies

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Ejaaz:
have spent private money, money that they've raised from investors or earned

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Ejaaz:
themselves through revenue.

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Ejaaz:
And now they're turning to the public and saying, we need more money to build

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Ejaaz:
out more data centers and GPUs so that we can train these models and facilitate

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Ejaaz:
all the demand that we're seeing.

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Ejaaz:
Now, if you talk to each of these companies, none of them say that there is no demand on their side.

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Ejaaz:
Google and I believe Amazon, Microsoft and Meta have all reported profitable

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Ejaaz:
quarters through all their AI CapEx expenditure.

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Ejaaz:
I think combined, actually, those four companies were aiming to spend around

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Ejaaz:
$1 trillion this year, but it's not enough.

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Ejaaz:
And so they need more money to kind of like fund all of this thing.

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Ejaaz:
The criticism that comes to me is like, I don't know whether this is the point

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Ejaaz:
of no return. We were chatting about this before we started recording,

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Ejaaz:
where there's no going back after this.

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Ejaaz:
We are jumping into the abyss, and whether we're going to lever up through debt

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Ejaaz:
instruments or whatever that might be, there is no returning from this. It is all in or nothing.

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Josh:
Well, and the thing I found most interesting is it's not just the companies that are going all in.

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Josh:
It's the institutions, and it's the public, and it is pretty much everyone who's going all in.

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Josh:
So much so that the largest funds on Wall Street that actually host these IPOs

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Josh:
are changing the rules just to accommodate them.

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Josh:
This most recent one happened around the SpaceX IPO, where index providers,

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Josh:
they waived their profitability requirements and cut the seasoning window from

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Josh:
90 days to five. Basically, what that means is...

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Josh:
A company needed to prove that it was a viable company that could be traded

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Josh:
publicly before index funds were required to buy it.

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Josh:
Now, those index funds can buy it a lot sooner.

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Josh:
So a lot of people who might not want to be investing in SpaceX,

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Josh:
their retirement funds, their 401ks, the indexes that hold it are going to be

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Josh:
able to invest a lot faster than they normally otherwise would have been.

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Ejaaz:
Yeah, this has never happened before. So SpaceX is effectively changing the

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Ejaaz:
rules of the IPO market in order to facilitate the massive raise that they're going for.

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Ejaaz:
So a few sentences here that caught my eye. This forces over $30 trillion in

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Ejaaz:
passive 401k, so retirement fund money, to buy SpaceX.

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Ejaaz:
It's forcing them to buy it at IPO valuation. So it roughly means that around

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Ejaaz:
24% of SpaceX's IPO supply of shares is going to be absorbed through these passive funds.

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Ejaaz:
We've never seen anything like that before. Secondly, typically,

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Ejaaz:
if you want to get included in indexes, prestigious indexes,

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Ejaaz:
such as the NASDAQ 100 or the Fortune 500, you need to, one,

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Ejaaz:
demonstrate that you're earning a ton of revenue, and two,

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Ejaaz:
demonstrate that for, I think it was like one or two successive quarters.

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Ejaaz:
So we're talking about like three to six months.

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Ejaaz:
All of those rules are being waived to days.

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Ejaaz:
We're talking like five to 15 days for two separate different indexes that are

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Ejaaz:
saying, okay, listen, if you can prove that the IPO price trades above a certain

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Ejaaz:
price for this amount, we'll include you the index.

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Ejaaz:
Don't worry, we'll forget about it. And we'll get all these pension funds to

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Ejaaz:
purchase or buy your stock.

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Ejaaz:
So Elon basically needs to keep the stock price up for above a certain level, and he's good to go.

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Josh:
Well, it's a little concerning because like for decades, these big indexes,

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Josh:
they've had two rules specifically designed to protect ordinary people who just

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Josh:
have investment accounts, retirement accounts.

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Josh:
And those two rules were like you mentioned, one of them was four straight quarters of profit.

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Josh:
And then the other was a minimum float of five to 10%. And actually those were

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Josh:
implemented because of the fallout from the dot-com crash.

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Josh:
In 1999 to 2000, indexes took a bunch of the super high growth cash losing companies

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Josh:
near the top. And that means that 401k holders or retirees, they were also holding

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Josh:
those companies and kept holding the bag.

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Josh:
So after they got crushed in the bubble burnout, what happened was is that they

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Josh:
implemented these rules. Now it feels like we're having deja vu.

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Josh:
The rules are getting reversed again. So now you don't actually need to have

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Josh:
four straight quarters of gap profit.

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Josh:
You just need to have, I believe it's 15 days.

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Josh:
So it's like a pretty considerable decrease in the parameters required to allow

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Josh:
these index funds to invest.

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Josh:
And it's like history doesn't to repeat, but it certainly does rhyme.

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Josh:
And it seems like the last time we did this, it wasn't good.

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Josh:
Now we're kind of reverting back to those terms.

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Josh:
That seems a little bit concerning to me, at least. So that's to be noted.

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Josh:
I think it's probably good for the price, right? It's like there's so much buying

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Josh:
pressure that's going to be pushing SpaceX up, but the downstream effects of it,

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Josh:
not going as well as planned are going to hurt some people who might not want

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Josh:
to be buying SpaceX shares in the first place?

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Ejaaz:
You know, Josh, I think the main criticism of the SpaceX IPO,

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Ejaaz:
and I think honestly, a lot of it is justifiable, is they just haven't proven

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Ejaaz:
the revenue model just yet.

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Ejaaz:
They're saying like, hey, we'll launch AI data centers in space.

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Ejaaz:
We'll do it on our rockets. But they haven't like proven that model,

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Ejaaz:
at least even like a proof of concept right now, like they're launching space rockets up there.

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Ejaaz:
But like, we don't have GPUs in space that are currently training Frontier models.

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Ejaaz:
So it's still kind of like, trust me, bro, in a sense.

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Ejaaz:
Now, one company that has proven

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Ejaaz:
a lot of revenue and has gone on the craziest story arc is Anthropic.

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Ejaaz:
And yesterday, they filed for a draft S1 registration statement of the SEC,

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Ejaaz:
which basically states that they plan to IPO in the coming months. Now,

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Ejaaz:
The story is very different with Anthropic in a few different ways.

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Ejaaz:
Josh, if you remember, at the end of last year, we did an episode, right?

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Ejaaz:
And we mentioned something about the CFO, Krishna Rao, of Anthropic.

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Ejaaz:
And he said, we have no immediate plans to IPO. We're taking our time.

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Ejaaz:
Back then, they had achieved $9 billion of annual recurring revenue.

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Ejaaz:
And they had estimated for the entirety of 2026 that they would hit something

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Ejaaz:
along the lines of $20 billion of ARR. They hit that in the first month and a half of 2026.

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Ejaaz:
And most recently, they just hit $45 billion of ARR.

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Ejaaz:
That's because of the success of Claude Code, Claude Cowork,

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Ejaaz:
and a host of other enterprise contracts, which they are signing.

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Ejaaz:
They're doing a bunch of different JVs. They're raising money from Blackstone.

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Ejaaz:
They're doing a ton of different things.

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Ejaaz:
So in contrast to SpaceX, they are actually earning a lot of money.

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Ejaaz:
So it makes sense that they now want to take this a step further.

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Ejaaz:
They're acquiring as much compute as they can. and they're in a race with mainly

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Ejaaz:
OpenAI to serve their frontier models, to train their frontier models and to

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Ejaaz:
provide it to as many people as they can.

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Ejaaz:
That's why I think they're going forward with this IPO. Now,

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Ejaaz:
it's important to state that there was no details released, was there?

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Ejaaz:
This is just kind of like a mandatory statement that they had to make.

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Ejaaz:
OpenAI, I don't think, had to

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Ejaaz:
do this, but Anthropic, in the efforts of transparency, decided to do it.

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Ejaaz:
I have a few reasons why I think they might be doing it, but I don't know.

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Ejaaz:
Do you have any thoughts? Yeah.

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Josh:
It's funny. It's a confidential disclosure of a confidential filing.

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Josh:
It's pretty ironic, but I think this took a lot of people by shock.

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Josh:
Everyone was kind of surprised at the rate. I was looking at Polymarket and

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Josh:
everyone expected OpenAI to IPO prior to Anthropoc.

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Josh:
So to see this news shocked it and it kind of flipped the margins on their heads

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Josh:
there in terms of the Polymarket.

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Josh:
But what I'm seeing here with the information post, and this actually looks

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Josh:
outdated because the rumors I've

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Josh:
been seeing is that Anthropoc is actually growing even faster than this.

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Josh:
And it's showing that Anthropoc just has this unbelievable growth trajectory

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Josh:
that has been driven by real value add, mostly on the enterprise side in creating

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Josh:
these like unbelievable models.

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Josh:
I know, I mean, when you think about Mythos now, they announced it,

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Josh:
what, two months ago, which means it finished training even before that.

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Josh:
And like, they just have these unbelievably powerful models.

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Josh:
I feel like they're feeling really confident going into this.

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Josh:
And it gets into the conversation about how much money actually is there for the market to absorb.

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Josh:
Is there actually a race to go out and collect capital

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Josh:
because we know spacex is going first the rumor is maybe around june 12th that's

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Josh:
coming in the next like two weeks so that's going to absorb god maybe a hundred

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Josh:
billion dollars of capital it looks like they're trying to raise 75 but i'm

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Josh:
sure it's going to exceed that how much money can anthropic then pull from that

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Josh:
and then if open ai is after them how much money is going to be left for them

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Josh:
and it feels like we're just,

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Josh:
demanding a lot from public markets and like we started the private markets

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Josh:
maybe they're tapped out, maybe they're not, but we're going to quickly learn how fast,

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Josh:
public market reserves can get tapped out because this is a tremendous amount

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Josh:
of capital everyone's raising.

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Ejaaz:
I mean, the way I think about it, right, is you have a subset of investors that

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Ejaaz:
are purchasing or will purchase the stocks of these different companies for

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Ejaaz:
one particular thesis, right, which is like, I'm bullish on AI.

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Ejaaz:
But then you have a whole retail subsection that are like, I just use Claude

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Ejaaz:
every day, and it's super helpful to me.

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Ejaaz:
So obviously, I'm going to buy that thing, right? I use ChatGPT every day, right?

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Ejaaz:
So there's these two subsects, and they're all going to result in the same thing,

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Ejaaz:
which is like, we're going to purchase stock of these companies.

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Ejaaz:
Now, if you're on the company side, you're using it for one thing.

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Ejaaz:
Krishna Rao, CFO of Anthropik, has said it.

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Ejaaz:
Sarah Fryer, CFO of OpenAI, has said it. And Elon has said it.

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Ejaaz:
We just need more compute because more compute translates into better AIs,

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Ejaaz:
which translates into better products, which means that we can serve more customers,

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Ejaaz:
which means that we can earn more money.

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Ejaaz:
Now, in Anthropik's case particularly, I think the rumors around their AGI-like

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Ejaaz:
model called Mythos is very real.

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Ejaaz:
We've got like breaking news from today that I have up on the screen that they're

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Ejaaz:
rolling out their Project Glasswing, which is kind of like the bucketed sandboxed

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Ejaaz:
version of release for Claude Mythos to 150 additional organizations across the entire world.

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Ejaaz:
And they even said on a previous statement recently that they're going to be

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Ejaaz:
releasing it publicly to people over the next couple of weeks.

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Ejaaz:
So I think this all comes at a very coincidental, intentionally coincidental time.

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Ejaaz:
And the other thing that's different with Anthropik is they're estimated to

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Ejaaz:
be profitable by the end of this month to the tune of $550 million, which, listen,

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Ejaaz:
is a drop in the ocean compared to like the trillions of dollars that are being

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Ejaaz:
spent on CapEx, but they'll be the first major AI lab to do so.

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Ejaaz:
And so it's just this massive run rate. I think of all these IPOs,

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Ejaaz:
I'm probably most bullish on the anthropic thing, but they're all different

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Ejaaz:
to their own kind of lane.

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Josh:
Now, when we were looking at our bubble meter in a few episodes ago,

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Josh:
and we were kind of figuring out at what point do things get scary?

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Josh:
It was largely around the idea that these large mega companies like Google will

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Josh:
start to spend more than their revenues allow them to.

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Josh:
Basically, they'll start going into debt to fund these build outs.

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Josh:
And we have some indication that we're kind of slowly turning into that territory

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Josh:
where Google has ran out of revenue on their balance sheet and are now looking

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Josh:
to raise external capital.

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Josh:
This is not IPO related as you know Google has been

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Josh:
public for a very long time but they need more money so

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Josh:
what did they do they went out and raised 80 billion dollars to fund the AI

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Josh:
build out that is a tremendous amount of capital I can't remember the total

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Josh:
capex spend that they guaranteed but I imagine it's close to like 30 40 percent

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Josh:
of the total that they were planning to spend annually and they just went and raised it noteworthy,

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Josh:
Berkshire Hathaway, Warren Buffett's old company, wrote a $10 billion check

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Josh:
to get in. And it's a pretty huge deal.

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Josh:
It's $30 billion in underwritten public offerings, $40 billion through an at-the-market

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Josh:
stock program starting in the third quarter of this year, and then $10 billion

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Josh:
through private placement to Berkshire, which we just talked about. So it's a huge deal.

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Josh:
And he's just I'm curious your take on this, actually, because we did a deep

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Josh:
dive into Google's balance sheet.

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Josh:
We saw how much money they made. We saw how much they were spending. They were in the green.

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Josh:
Now it looks like they're intending to. Are they going to go in the red or are

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Josh:
they just offsetting? Are they softening the blow so that they still have a

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Josh:
lot of cushion just in case?

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Ejaaz:
Yeah, I think they're leaning all in and they'll eventually have books in the red.

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Ejaaz:
Larry and Sergey Brin, the founders of Google, said very explicitly,

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Ejaaz:
I think it was a year and a half ago, that they are willing to lose it all versus

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Ejaaz:
like lose the actual AI race.

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Ejaaz:
So they're going to spend, spend, spend until they create enough compute.

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Ejaaz:
It's founder mode. They've gone back to founder mode.

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Ejaaz:
Sergey Brin came back to Google to do exactly this, to kind of lock in.

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Ejaaz:
This is my favorite IPO story of the week. And it's not even an IPO,

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Ejaaz:
right? So you have Google, public company, raising $80 billion.

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Ejaaz:
Now, the question becomes, what are they using that $80 billion for?

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Ejaaz:
Now, the headline is, we're using this $80 billion to build out more AI CapEx.

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Ejaaz:
We're going to build more TPUs. We're

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Ejaaz:
A story that a lot of people missed is, I think it's like 30 billion of this

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Ejaaz:
80 billion is being used to pay off tax obligations for their employees who

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Ejaaz:
are cashing out stock over the next couple of months.

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Ejaaz:
All right. So like, I just want to be clear here, like, a large chunk of this

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Ejaaz:
raise isn't actually going to be used for the AI cap expand.

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Ejaaz:
Now, putting that aside, Google isn't a bad actor, in my opinion.

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Ejaaz:
They've been pretty transparent as they can be with how much they're spending

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Ejaaz:
on all this AI stuff and what they intend to do with all of this.

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Ejaaz:
And they're giving it their best shot.

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Ejaaz:
Now, what this gives me reminiscence of is, Josh, do you remember at the end

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Ejaaz:
of last year, we were kind of saying how OpenAI is kind of distracted.

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Ejaaz:
They're kind of focusing on like random AI products and they're like missing

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Ejaaz:
the whole coding AI thing and all that kind of stuff.

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Ejaaz:
And then they decided to call a code red and lock in. I feel like Google has

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Ejaaz:
drifted into that kind of like broad spectrum of things.

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Ejaaz:
They're not really focused. They're like building out an agent,

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Ejaaz:
but then they're trying to build out a better coding model.

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Ejaaz:
They're trying to build out a better generalized LLM, but then they're building

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Ejaaz:
out the infrastructure TPUs, but then they're selling those TPUs to competitors,

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Ejaaz:
which means that they don't have enough compute to train their own Gemini models,

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Ejaaz:
which means that Gemini falls behind, and it has fallen behind.

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Ejaaz:
Their recent Gemini 3.5 flash is behind Frontier models despite all this money

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Ejaaz:
that they had, and now they need to raise all this money to train a better model.

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Ejaaz:
It just seems like they just need to lock in and focus.

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Ejaaz:
Now, when I look at this structure, $80 billion, that's a lot of money.

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Ejaaz:
It's effectively their own IPO to be able to fund their own build out.

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Ejaaz:
I'm not convinced that spending $30 billion of that to write off tax obligations

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Ejaaz:
is the best way to do it. It kind of wreaks a little bit of desperation.

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Ejaaz:
But I am optimistic because the last four times that we've had this kind of

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Ejaaz:
public raise from a major company, Berkshire Hathaway has put in a $10 billion check.

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Ejaaz:
And all of those companies have done pretty well. So I'm hoping the same thing

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Ejaaz:
is going to happen with Google. But it's just an interesting story.

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Josh:
Yeah. I mean, in Berkshire, we trust, right? Like they have been right in the

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Josh:
past. They are very disciplined.

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Josh:
We're going to hope they continue. It's also nowhere that Google owns a large

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Josh:
percentage of a lot of these companies going public.

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Josh:
I mean, Google is one of the largest private stakeholders in SpaceX and also Anthropic.

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Josh:
So they stand to benefit from the upside of this in a pretty considerable way.

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Josh:
It's also a little bit scary how large these numbers are getting.

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Josh:
It feels like we're getting numb to the hundreds of billions of dollars number.

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Josh:
I mean, Google at $180 to $190 billion in CapEx this year is unbelievable to

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Josh:
imagine just a few years ago.

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Josh:
So for them to go all in, it's all in at a scale that we have never seen before.

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Josh:
And I think that's one of the themes of this episode is we're really experiencing,

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Josh:
like this is a very special time in history because never in the history of

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Josh:
this country and capitalism has this amount of money and value been concentrated

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Josh:
on pursuing a single idea.

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Josh:
And the outcomes of that are going to be pretty big.

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Josh:
I mean, bubble or not, we're building real value, real intelligence being built.

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Josh:
And I think like the actual underlying civilizational shift is going to start

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Josh:
to be felt as the outcome of all the spending starts to make its way into the market.

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Josh:
And I think it's like it's easy to get lost in the numbers that are huge and large.

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Josh:
It actually is going to result in real valuable tools. And we make fun of Google.

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Josh:
They haven't come out with a new frontier model in a while.

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Josh:
But I mean, I'm just using their tools and services now. And they're noticeably

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Josh:
getting smarter and smarter and smarter.

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Josh:
One thing I'm excited about is WWDC next week. We're going to be covering that.

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Josh:
We'll see how Apple plans to actually roll out these tools and make them smarter

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Josh:
and smarter. So we'll see where all the CapEx has been going.

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Josh:
But there is one more IPO that's coming that we haven't mentioned, which is OpenAI.

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Ejaaz:
Yeah, exactly. So we mentioned it earlier, but 10 days before Anthropic Fall

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Ejaaz:
for that, potential IPO. OpenAI did the very same thing.

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Ejaaz:
Confidentially confidential filing, by the way. And so it was reported...

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Ejaaz:
They get this one confidential.

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Josh:
Even though it leaks. It's like, if it's all going to leak, you might as well

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Josh:
just publish it yourself.

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Ejaaz:
Yeah. What was curious is the polymarket market on this particular IPO spiked

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Ejaaz:
up before the Bloomberg and Financial Times report.

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Ejaaz:
So there was definitely some insider stuff going on. But basically,

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Ejaaz:
Goldman Sachs and Morgan Stanley have reportedly been behind the scenes helping

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Ejaaz:
OpenAI and prepare for their IPO.

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Ejaaz:
If you're wondering why they're doing it, it's for all the same reasons.

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Ejaaz:
They wanna raise more money to build out a bunch of different data centers.

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Ejaaz:
I think they broke ground on a new data center literally a few days ago, so it's all in.

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Ejaaz:
A comment that I have is, and maybe this is like a potentially hot take, Josh, is,

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Ejaaz:
I think all of this money that is being raised and is about to be spent is ultimately

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Ejaaz:
going to result in a good thing.

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Ejaaz:
I think that it's ultimately not going to be bubbly in its nature,

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Ejaaz:
and it's going to result in the necessary infrastructure that is going to be

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Ejaaz:
onshore in the West or in the U.S.

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Ejaaz:
Specifically to create that next bedrock of foundation for technological innovation. You need compute.

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Ejaaz:
You need the electrical lines. You need all the substrates to make these GPUs

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Ejaaz:
and silicon chips actually work to serve it to customers. You need all of this.

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Ejaaz:
And we are currently constrained by physical atoms.

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Ejaaz:
If that sounds like a vague statement, it is not. I literally mean that.

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Ejaaz:
I sit on the Gavin Baker's camp of opinion here, which is no matter how much

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Ejaaz:
money you want to lever up and spend,

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Ejaaz:
you can't actually spend the money because you are limited by how slow it is

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Ejaaz:
to overcome regulations and build the actual, you know, brick and mortar of

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Ejaaz:
the data centers and then create the silicon chips. There's only one ASML.

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Ejaaz:
There's only one NVIDIA. There's only one TSMC. And it's hard to scale the physical

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Ejaaz:
infrastructure side of AI.

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Ejaaz:
So even if you want to lever up and create all these like weird debt structurings,

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Ejaaz:
it does not matter because there is nowhere to spend it on. You're limited by physical atoms.

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Ejaaz:
And until I see that block get unblocked we're not in a bubble

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Josh:
This is my take yeah i mean to talk about gavin

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Josh:
baker's point again he always mentions the idea of dark fiber comparing it to

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Josh:
the internet bubble era where there was a tremendous amount of fiber optics

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Josh:
laid for the internet but there simply wasn't enough use cases for the internet

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Josh:
to go through the fibers there was a lot of dark fiber a lot of the build-out

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Josh:
didn't get used it didn't generate revenue everything fell apart in this case,

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Josh:
I mean, we talk about this all the time, but the GPUs from four or five years

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Josh:
ago are being rented for more money than they were four or five years ago.

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Josh:
Yeah, they're worth more.

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Josh:
They're worth more. And it's funny, like Michael Burry, the big short guy,

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Josh:
he was like, no, no, no, that's wrong. Everything's going to crash.

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Josh:
He could not have been more incorrect.

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Josh:
So, so far, all of the guidance, all the signals that we're seeing are green.

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Josh:
They're all positive. Everything looks good. It seems like CapEx is actually returning real value.

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Josh:
I mean, there was those rumors about Anthropic maybe turning up profits sometime

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Josh:
soon, as you mentioned earlier.

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Josh:
That's a really huge deal because if they could actually

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Josh:
absorb all of this um fundraising money

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Josh:
and then spend it in a way that's capital effective enough where

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Josh:
they can return revenue that's like huge and open ai i

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Josh:
don't believe they were planning on doing that for at least till the end of

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Josh:
this year so all these signs are green the one thing i'm looking out for personally

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Josh:
is companies who are cutting back on spending i know there's some news in the

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Josh:
headlines about a half a trillion dollar bill that came up for amazon that was

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Josh:
unintentional i don't know how true these things are but.

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Ejaaz:
I think so you know

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Josh:
Yeah so so long as companies are still extracting value from these ai systems

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Josh:
then they'll continue to spend because it will just increase the revenue and

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Josh:
increase the margins in their own business and so far so good fingers crossed it used to go that way did.

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Ejaaz:
You see the uh the crazy stat that christian rao

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Ejaaz:
dropped on i think it was like the invest like the best podcast

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Ejaaz:
um anthropic for the fortune 10 so like 9 out of 10 of the fortune 10 so the

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Ejaaz:
top 10 companies in the world basically use anthropic thought code specifically

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Ejaaz:
and their net dollar retention rate which is basically like the budget that

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Ejaaz:
they started with january 1st versus how much they estimate to spend by the end of the year

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Ejaaz:
is increased by 500%. So they're planning to spend 5x more.

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Ejaaz:
But the reason why they're doing that is not because they have to,

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Ejaaz:
it's because they want to, because they're getting so much ROI on the back end.

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Ejaaz:
So the point is, if this continues to trend in the right way,

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Ejaaz:
the definition of a bubble is it's over-levered, and there's not enough demand on the buy side.

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Ejaaz:
We're seeing the opposite happen, and we actually can't supply enough of the

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Ejaaz:
silicon and compute to serve the buy side. That's why Google's raising $80 billion.

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Ejaaz:
That's why all these companies are IPO-ing at massive valuations.

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Ejaaz:
It's so that they can serve that.

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Ejaaz:
And maybe I'm drinking my own Kool-Aid, but that's my take.

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Josh:
Well, and also think about the downstream effects of that. They're huge.

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Josh:
Now we have all this infrastructure that we're building out in the United States.

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Josh:
We have the ability to build it out.

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Josh:
And soon that's going to transition away from software as well.

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Josh:
Like software will continue to be important, but I just saw a post from OpenAI

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Josh:
recently. They're hiring for a robotics division. They're going to start building robots.

387
00:23:01,340 --> 00:23:04,760
Josh:
SpaceX is building their Optimus robot. We're going to get a reveal probably

388
00:23:04,760 --> 00:23:08,940
Josh:
around the time of the IPO, I would assume to gather a little more attention.

389
00:23:09,320 --> 00:23:13,940
Josh:
And I think what we're seeing here is this like really huge shift of industrializing

390
00:23:13,940 --> 00:23:15,040
Josh:
the United States in a big way.

391
00:23:15,140 --> 00:23:18,840
Josh:
Like we're going to get satellites into space. We're going to send data centers into orbit.

392
00:23:19,040 --> 00:23:22,480
Josh:
This takes a huge amount of capital, but think about the value it delivers.

393
00:23:22,620 --> 00:23:26,620
Josh:
Think about the value of cloning the internet, but putting it into low earth orbit.

394
00:23:26,740 --> 00:23:30,680
Josh:
So that way it's, it's nation state proof. It can never go offline. You never have outages.

395
00:23:30,980 --> 00:23:34,060
Josh:
It's just this unbelievable technology that we're building funded by

396
00:23:34,060 --> 00:23:38,300
Josh:
this capex build out this huge spending and now the public has the opportunity

397
00:23:38,300 --> 00:23:41,720
Josh:
to actually get involved so is it going to be good or bad for the public we

398
00:23:41,720 --> 00:23:44,360
Josh:
will see i'm feeling pretty bullish i think this is where i want to end the

399
00:23:44,360 --> 00:23:49,240
Josh:
show actually ejaz is asking you which of these three if any are you most excited

400
00:23:49,240 --> 00:23:52,860
Josh:
about and most likely to invest in at the ipo.

401
00:23:53,340 --> 00:23:57,380
Ejaaz:
Oh, damn, I'm excited about all of them, dude. Okay, if I had to rank them,

402
00:23:58,020 --> 00:24:03,620
Ejaaz:
it's Anthropic, SpaceX, and OpenAI, but like it's within like a hair's distance

403
00:24:03,620 --> 00:24:05,140
Ejaaz:
between each other. It's so tough.

404
00:24:05,640 --> 00:24:09,900
Ejaaz:
They're all building amazing things. And I do truly believe that these three

405
00:24:09,900 --> 00:24:14,220
Ejaaz:
companies will create products and services that will become the bedrock of

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00:24:14,220 --> 00:24:17,200
Ejaaz:
everything and anything that we build future businesses on.

407
00:24:17,420 --> 00:24:20,820
Ejaaz:
And so the question is, how much would you value that kind of a company, right?

408
00:24:20,840 --> 00:24:23,640
Ejaaz:
We've never seen anything like this before, right? We've never seen a type of

409
00:24:23,640 --> 00:24:28,140
Ejaaz:
technological disruption which permeates every single industry that you could

410
00:24:28,140 --> 00:24:31,280
Ejaaz:
possibly think of, including the hardware side of things, right?

411
00:24:31,300 --> 00:24:33,620
Ejaaz:
What do you think happens when robotics scales up?

412
00:24:33,900 --> 00:24:36,180
Ejaaz:
You're going to need a robotics model. You're going to need data to do that.

413
00:24:36,240 --> 00:24:37,500
Ejaaz:
That's what these AR labs are going to do.

414
00:24:38,440 --> 00:24:42,480
Ejaaz:
And you're going to need infinite compute, potentially in space.

415
00:24:42,600 --> 00:24:46,980
Ejaaz:
You're going to need really smart models, potentially trained on RL from Anthropic

416
00:24:46,980 --> 00:24:49,120
Ejaaz:
or from OpenAI that is able to do this.

417
00:24:49,200 --> 00:24:52,560
Ejaaz:
And these three companies are the clear bet. So if I take a long-term perspective,

418
00:24:52,760 --> 00:24:58,060
Ejaaz:
which is typically how I invest, I'm going to buy an IPO and we'll see what happens, you know?

419
00:24:58,220 --> 00:25:02,520
Josh:
Yeah, I'm pretty stoked for all of them. I think for me, SpaceX is most interesting.

420
00:25:02,680 --> 00:25:05,580
Josh:
I've been a fan of them for as long as I can remember.

421
00:25:05,960 --> 00:25:08,040
Josh:
They are just such a badass company. How long have you been tracking SpaceX.

422
00:25:08,180 --> 00:25:09,700
Ejaaz:
Josh? You've got to flex that. Come on.

423
00:25:10,460 --> 00:25:12,780
Josh:
Well over a decade, probably close to 15 years.

424
00:25:12,960 --> 00:25:13,300
Ejaaz:
That's it.

425
00:25:13,340 --> 00:25:18,220
Josh:
Like it was as the beginning of the Falcon 9 program started because I remember

426
00:25:18,220 --> 00:25:21,500
Josh:
watching all the live streams. And in fact, my YouTube channel is like,

427
00:25:21,600 --> 00:25:23,160
Josh:
I think, 14, 15 years old or something.

428
00:25:23,340 --> 00:25:29,120
Josh:
The first video I ever posted was like a handheld camera of my screen of the Falcon 9 launch.

429
00:25:29,240 --> 00:25:32,340
Josh:
It was like, it's pretty amazing because it's been so cool to watch them go

430
00:25:32,340 --> 00:25:36,980
Josh:
from the Falcon 1, which is a single rocket thruster to 9 to now Starship,

431
00:25:37,080 --> 00:25:40,040
Josh:
which has like between the booster and the first second stage, like.

432
00:25:40,690 --> 00:25:45,210
Josh:
30, 940 engines. It's like unbelievable how much progress they've made.

433
00:25:45,310 --> 00:25:49,310
Josh:
And it's so exciting because it opens up this awe-inspiring opportunity and

434
00:25:49,310 --> 00:25:53,410
Josh:
having the opportunity to invest in that company to participate is really exciting to me.

435
00:25:53,530 --> 00:25:57,190
Josh:
I know people are upset that it's trading so high on a relative basis,

436
00:25:57,190 --> 00:26:00,590
Josh:
but when you consider what the future looks like in the case they succeed,

437
00:26:00,610 --> 00:26:04,030
Josh:
and when you consider what the team requirements need to look like,

438
00:26:04,290 --> 00:26:06,730
Josh:
there's really no better chance.

439
00:26:07,090 --> 00:26:08,830
Josh:
You can't assemble a better team.

440
00:26:08,970 --> 00:26:11,990
Josh:
You can't assemble a better company than this to take a shot on goal.

441
00:26:12,190 --> 00:26:15,970
Josh:
So it's at least worth getting excited about and supporting that shot on goal,

442
00:26:16,050 --> 00:26:19,090
Josh:
that like civilization is going to do something we've never done before in a

443
00:26:19,090 --> 00:26:21,110
Josh:
really cool and exciting way that stands to benefit everyone else.

444
00:26:21,290 --> 00:26:22,630
Josh:
And that's why I'm excited about SpaceX.

445
00:26:22,850 --> 00:26:27,110
Josh:
I will try to participate. Hopefully it doesn't launch at like a $4 trillion valuation.

446
00:26:27,590 --> 00:26:29,990
Josh:
Hopefully it stays kind of close to the share price it launches at.

447
00:26:30,170 --> 00:26:33,390
Josh:
I think that's another thing we'll have to look out for is like how high the

448
00:26:33,390 --> 00:26:36,610
Josh:
premiums actually are once they start trading, because we know there's going to be a ton of hype.

449
00:26:36,750 --> 00:26:39,610
Josh:
But yeah, I think that's just about everything for this episode. Any final thoughts?

450
00:26:40,150 --> 00:26:44,830
Ejaaz:
Nope, that's pretty much it. I just want to remind the audience that's listening

451
00:26:44,830 --> 00:26:49,010
Ejaaz:
to this that Josh and I are delusionally optimistic about a lot of these different things.

452
00:26:49,190 --> 00:26:52,830
Ejaaz:
We do try to ground ourselves occasionally, but overall, we take an optimistic

453
00:26:52,830 --> 00:26:54,370
Ejaaz:
approach to AI and the frontier of tech.

454
00:26:54,750 --> 00:26:58,270
Ejaaz:
So none of this is investment advice. But if you did enjoy this episode,

455
00:26:58,430 --> 00:27:01,210
Ejaaz:
or if there's anything that you actually disagree with, please let us know in

456
00:27:01,210 --> 00:27:02,570
Ejaaz:
the comments. You guys are very vocal.

457
00:27:03,170 --> 00:27:05,790
Ejaaz:
Wherever you listen to us, if it's on YouTube, if it's on Spotify,

458
00:27:05,970 --> 00:27:08,650
Ejaaz:
if it's on Apple Music or wherever, please subscribe, give us a rating,

459
00:27:08,790 --> 00:27:09,950
Ejaaz:
leave us a review, leave us a comment.

460
00:27:10,050 --> 00:27:13,910
Ejaaz:
We want to hear from you guys about what you guys think. Are you enjoying these kinds of episodes?

461
00:27:14,150 --> 00:27:17,950
Ejaaz:
Are there other topics that we could cover that you might be more interested in hearing more about?

462
00:27:18,250 --> 00:27:20,870
Ejaaz:
Let us know. But Josh, do you have any parting thoughts?

463
00:27:21,450 --> 00:27:24,930
Josh:
That's it. Share this with a friend if you enjoyed. Let them know what they

464
00:27:24,930 --> 00:27:26,770
Josh:
got to know about these IPOs that are incoming.

465
00:27:27,110 --> 00:27:30,130
Josh:
Let us know which ones you're going to be participating in. And as always,

466
00:27:30,230 --> 00:27:32,290
Josh:
we will see you guys in the next episode. Thank you guys so much for watching.

467
00:27:32,510 --> 00:27:33,070
Ejaaz:
See you guys.