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You'Re watching tvpn we are in an undisclosed location so we will be a little bit quieter with the intro but it is friday september twelfth not to yell yes it hurts we will be back in the ultra dome soon don't worry but today we are still emotionally in the temple of technology the fortress of finance the capital of capital and we need to kick it off with the level one hundred performative tech bro final boss peter diamandis are you familiar.
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With diamandis an absolute legend in the.
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Game yeah what is it singular university yeah yeah i mean he has a podcast he's he's done a number of businesses x prize i believe moonshot stuff but man was he early to the singularity game yeah like it's he was talking about that with the the kurzweil era yeah and but the whole reason he's getting called a performative tech bro final boss is because of course he is vibe coding on rep lit over.
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Starlink flying himself up to the bay area the only thing missed was sleeping on an an eight sleep sleeping on.
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An eight sleep he should have had the eight sleep in there and then he should have had infinite just printed.
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Out sort of some type of homegrown like autonomous flying setup actually flying the.
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Plane he should have had a ramp card in display that's right time is money save both easy to use corporate cards bill payments accounting a whole lot more all in one place a lot more we are of course on the road we've been on the road a lot this week we hate being on the road it's not our favorite thing it's very very rough we know it changed the show hopefully we will get back in the swing of things and kind of bring you the show that you know and love but doing our best doing our best of course this stream's made possible right restream one livestream thirty plus destinations multi stream and reach your audience wherever they are and for our gracious hosts were able to loan us a whiteboard where we were able to piece together exactly what's going on in tech we're going to take you through the stories today openai.
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Calling this out this is exactly someone's gonna spend the next trying to decipher three hours.
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Trying to they're gonna put it together and we'll understand the real nature of tech how it's all connected this is.
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The current state of tech right i.
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Like it because there are some connections there like amazon and anthropic that red.
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Line is real real the hamptons and patek also real there's the connection there.
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Well manitis we'll leave it up to the viewer that's an exercise for the viewer to see how he's involved we didn't get figma on there we should have brought we should have been doing all this on a figjam you should go to figma dot com comma think bigger build faster figma helps design and development teams build great products together get started for free so the actual big story is that openai the nonprofit is going to control its for profit arm and own equity valued at one hundred billion dollars i believe this will make it the most highly valued nonprofit or like the most profitable nonprofit in world history the best funded nonprofit right and it is remarkable to think about what that will be like people have kind of written off the nonprofit is like it's going away like it is not going away like it will continue to be incredibly back it's it's it's incredibly back funded forever essentially to do a ton of interesting things i think we're going to see interesting things about come out of that organization but anyway the news this is from the journal and we'll and we'll break this down but nick has it summarized here openai llc will be converted into a delaware public benefit corporation open ai nonprofit retains control of the new public benefit corporation the nonprofit will hold one hundred billion dollars plus of equity in the public benefit corporation the pbc structure enables raising large amounts of capital for the mission which obviously they're already doing they're still aligned with ensuring agi benefits all of humanity i think that's good also just aligned with like your shareholders like if you're just a normal c corp i know they're a public benefit corporation but if you're just normal c corp like shareholders are humans let's make sure it benefits the shareholders that will by definition benefit humanity but specifically they're saying all of humanity even if you're not a shareholder agi should still benefit you which is a noble cause openai microsoft signed a non binding mou for the next phase of the partnership a definitive agreement is still being negotiated openai says it's engaging.
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Remember remember as it stands microsoft gets twenty percent of openai's revenue and for the big man something big man satya something like that which it felt like a stretch to me that that would be sustainable given the looming costs that openai needs to incur obviously they're ramping revenue really quickly but you have broadcom to pay you have oracle to pay you all these but it is tied.
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To revenue you know it's not the same as being like you're on the crazy fixed billion yeah it's an affix.
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Exactly but still it's a lot of you know these companies are under margin.
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Pressure already and wasn't the original deal that it would it would be twenty percent up until they paid one hundred billion dollars or something like that there was something where like it eventually ran its course i believe it had an ending and i think that's what's justifying a lot of the underwriting because the lesson from google lesson from facebook the lesson from you know microsoft and the rest of the hyperscalers was that you needed your dcf models to be twenty or thirty years into the future right yeah and so if you just if you if you didn't take into account the third decade of growth you were.
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Undervaluing originally reported twenty percent through twenty thirty okay which still is i don't.
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Think a lot of investors are scared by thinking about value in twenty thirty five i think they're fine with that now i think they're saying like yeah i have a ten year fund and realistically all the best venture investments spacex is still hanging out in the portfolio twenty years later they got continuation funds i think that a lot of investors are actually fine to say yeah this company is going to be like you know maybe a financial mess for ten years but if i'm super confident it's going to be a money printing machine in twenty i'll do the deal all.
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Day yeah i think that's the it's still insane to think that the deal ever got done in the first place microsoft deal yeah if you were if if if you talked to a founder and they were like yeah i was running a fundraise and like you know ended up taking this deal i got the valuation i wanted but ultimately it gave up twenty of revenue off the top too so not twenty of like profits but like a twenty tax on gross revenue yeah just for the just till twenty thirty yeah and the founder's like well it doesn't matter that much because i'm in this for like twenty years yeah most most do not get the pass on that yeah businesses very few businesses in the world especially like highly competitive you know categories can sustain a twenty tax off the top yep and still really produce any profits or be functioning at all obviously i'll push.
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You profits or what if your what if your business is mobile games in the app store you've been effectively paying apple at twenty thirty tax off the.
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Top for there's a bunch of examples like nvidia could do this too right and they sort of are through this.
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Deal i don't know i mean i agree with you like it is it is a crazy crazy deal unprecedented in a million ways but everything about the entire openai story is unprecedented unprecedented to start as nonprofit unprecedented to have who are the co founders elon musk peter thiel like you have like seven different co founders who have a bunch of co founders have gone off and start direct competitors that doesn't happen very often usually people are like i got bags in the category i'm going to go work on something something else yeah there's a bunch of weird stuff anyway speaking of the the nature of the of the industry and all the competitors sergey has a bit of a joke post here saying dario claude will take your job but it will feel ashamed elon look at this anime girl she says the n word and is almost naked zuck super intelligence will help people watch more instagram reels demis gemini recently calculated more precisely the motion of the heavens sam excited to open to announce that openai inc has entered into a definitive agreement with openai lp and o ai corporation and has signed mous with openai opco llc and openai global llc it really sums up it really sums up and sergey they're all cooking yeah they are all cooking and they're all telling like slightly different stories sergey these are all real corporate entities by the way.
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And it's yeah it's worth noting it feels like satya has definitely slow played the renegotiation of this deal like this has been they've been trying to make this happen for a long time it was reported a while back that satya wasn't budging but it's good to see that the company is able to so.
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Here'S a start moving forward rohan paul on what's actually happening with this openai and microsoft deal microsoft and openai struck a truce to extend their partnership clearing a major obstacle to openai shift into a for profit structure the new agreement is non binding right now but it sets the final stage for final terms to be hammered out soon in the proposed setup microsoft and the openai nonprofit would each start with about thirty percent of the new company with the rest going to employees and investors the new company company is the for profit entity openai is trying to create as part of its restructuring openai plans to keep non profit control and give that nonprofit an endowment stake valued at a hundred billion dollars wow which would be huge on paper but the timeline to turn it into usable grants is unclear although with the secondary markets you you imagine that that has to be like they're going to make payroll next quarter like they'd be able to sell some of that one hundred billion dollars and do a whole bunch of grants california and delaware attorneys are generally reviewing the plan and openai has told its invest it aims to finish the restructure by the end of the year or risk losing its nineteen billion in funding it's very funny that like for all this drama all the books that will be written the movies like the end results like okay there's like three parties around the table how about we go equal like microsoft gets a third nonprofit gets a third employees investors gets a third like there's really like three key counterparties in the deal and there it seems like if this is what happens they kind of just all walked away being like.
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Yeah three equally three key parties on the on the effectively on the cap table but then you also have the california being like hey don't mess this conversion up you know you you're a nonprofit california and delaware attorneys general are reviewing the plan and openai has told its investors it aims to i'm talking.
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About like the the end result of like who gets what in the like there's a bunch of poker chips on the table right now and there's a bunch of there's parties around there that all need to agree before anything move forward right yeah and it's just interesting that what they wound up with was like let's go equal let's split it.
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Equally yeah if you play this out what happens what do you think the nonprofit looks like ten years from now openai continues to execute very well becomes a multi trillion dollar tech giant and you have a third of the company owned by this nonprofit what do you think i know how would happen buddy how would you how would you allocate.
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What what happens when you get a ton of missionary ai genius scientists who don't want to optimize for profits they're just experimenting working on whatever ideas they want there's no pressure because they don't have a user base they don't have an app store they're not competing with anyone they just get to go do pure research what do you think will.
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Happen so they're going to create the.
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Banger consumer app will happen for sure oh another nonprofit is going to launch another company and this convert to for.
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Profit again well i don't know i mean you could you could you could last time the question is like okay what is the real relationship between the nonprofit and openai like the private you know for profit arm because there's a world where they're just like okay we're just going to keep a lot of research and r and d happening at the nonprofit layer and then like try to just be the ones that commercialized commercial every time every time even though you would have to argue if it's like this i don't know yeah i.
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Think i think over time like the two entities will actually separate and drift.
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Apart it's hard to drift apart when we're you know they're sitting on on.
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Thirty percent of the cap table yeah i don't know that's not that crazy like there are vc funds that own thirty percent of a company when it goes public and well yeah they'll drift up like the vc fund is like off doing other stuff right investing in competitors sometimes like just kind of looking for the next thing getting out of the position slowly right selling into the public markets so i don't know of course i'm kind of joking and it's like a little bit of a hot take to think that like there will be something but truly like like if you if you want okay another interesting twist is like right now there is a there is a war for talent in ai and there's a war for specifically for missionary talent right the true believers the folks who are just going to go grind and explore and not be beholden to optimizing next quarter's maus right so if you're openai and you don't want your direct competitors telling that story hey we're the missionary ai lab creating a talent vacuum for that type of that type of that archetype of researcher with a nonprofit saying oh oh yeah well like we're a nonprofit like you can do whatever you want you can just do research and we'll match the salary that anthropic's paying you or oh zuck made an offer yeah we'll match it just for you to come.
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And hang out yeah can they give those researchers exposure to the private company.
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Shares.
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Just being like yeah all of our directors at the nonprofit they get paid out a bonus based on there's plenty of histories of nonprofits being abused right yeah like nonprofit people get paid.
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Like high salaries usually like stock in.
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A different company well yeah but it it could just be like you know every year the stock appreciates some amount and they sell off a position to.
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Be able to pay you would assume that they that they're selling down the.
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Position and paying cash such such a strange position it's extremely strange and this is why when i talk to founders that are like i think more and more people have kind of like standardized around just like start your company on stripe atlas yep don't try to read delaware c corp yeah delaware c corp.
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On stripe atlas post elon like make sure you have that thing like that has not made its way down to startups yeah most startups are just but.
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Every i mean i have i have a friend of mine that i grew up with that that had a breakout consumer product he botched the cap table didn't set up vesting and it ended up costing him like millions of dollars he would effectively be retired in his thirties if he had not if he'd done this correctly and that's why it's like it's so key to get the foundation the legal structure of a company set up properly and so the fact that you had peter thiel elon musk sam altman they all set up this this entity and and in the fullness of time it's like they botched it right like it it was it was a maybe a good idea at the time to try to create a nonprofit for ai research but just got kind of messier and messier and messier and messier and messier and every single you know person involved is probably thinking i wish we just set it up as a yeah as a c corp from.
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The beginning yeah completely agree good take the yeah this idea of like you know like the folks who are on the founding team are not dumb they're like the smartest people in silicon valley basically so maybe they were overthinking it or too smart and being like let's create an even more complex structure the flip side of the steel man on what happened is if you play it back and you go back to twenty fifteen you say okay yeah they raised.
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A lot of money and at the time ai was maybe too there wasn't an immediate commercial opportunity and so it's very possible they wouldn't have been able to raise like even if they raised.
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I think they might have been able to raise the money but then my question is like what happens in like twenty seventeen when your share price is kind of stagnating you still haven't made revenue and everyone and the meme in silicon valley is like oh yeah like sam raised a meg around pre product market fit like that company's not really doing anything when are they going to ship right instead it was just like oh yeah like they have a research organization and they're like continuing to do cool like little projects here and there and like oh they got the they got they got a robotic arm to solve a rubik's cube like oh they wanted chess or dota or like whatever they did and so i bet i bet the vibes were better throughout that it's really hard c corp just to keep because everyone's looking for a decade yeah when you're flat and then it's like yeah yeah i mean we've seen this with so many other companies that have raised hundreds of millions of dollars pre product launch and it's really hard to get out finally so i don't know the counterfactual is fascinating i wonder if it would have how it would have played out it's tricky yeah anyway.
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Yeah it's just interesting that almost every person around the table probably feels like they would have benefited from a more simple traditional structure i think you're right.
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Yeah and i think sam's even said that but like yeah we kind of overthought this one and like it would have been better just to come in clean but you know it worked out anyway more or less and like we.
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Got the yeah honestly opening eyes the best example of like if you have true product market fit you can botch so many things and still be wildly.
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Successful great tech anyway automate compliance manage risk and prove trust continuously with vanta vanta dot com comma vanta's trust management platform takes the manual work out of your security and compliance process and replaces it with continuous automation whether you're pursuing.
- [18:23]
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Your first managing a complex program duolingo snowflake intercom github ramp all of our.
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Favorites so i think we covered most of this we can go through a little bit of the wall street journal's coverage the primeogen i hope i'm pronouncing that correctly is putting dario from anthropic's claims about ai progress in the truth zone said we are twenty eight months into six months from ai taking your jobs four months into into twenty four months until cursor is obsolete and six months into six months until ai writes ninety percent of your code part two the codename so exactly six months ago this is the report from futurism the ceo of anthropic said that in six months ai would be writing ninety percent of code and there and so i think people when he when dario said this people interpreted it as okay well ninety percent of the software engineering jobs are going away and that certainly hasn't happened i mean we're not seeing like fantastic job numbers broadly in the economy there are like rumblings about software engineers not getting hired as fast as they.
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Should new grad struggling new grads struggling.
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But i mean we're talking about like like what a few percentage points if anything certainly not ninety percent of software engineers are out of a job yeah but simultaneously we're seeing folks like brian armstrong at coinbase highlight that what is it forty percent of their code is written by ai now there's a lot.
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More code being written there are great companies yeah that are internally not focused on hiring new people yes and they're still ramping revenue right we talked about this carp right code headcount yep palantir headcount is like relatively flat revenues way.
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Up couple thousand people.
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Klarna right headcount is way down revenues way up couple thousand people and so you have these companies that are doing well growing really fast and then not needing to add a lot of people you know you could just make an argument that that's like willpower right or the other side of it is like you know they're getting new efficiency and yeah there's it's an interesting it's hard to tell what what's driven by increased efficiency due to ai versus just ceo's deciding like we're all going to do more yeah and you don't i'm not giving you we're not giving you budget to like like for this new product you want to launch have two people launch it we're not going to give you twenty people and some massive yeah it is like.
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If you had told me artificial agi is real will pass the turing test ai will be able to write code at the level of a mid tier software engineer maybe not total top tier software engineer but like you're going to one shot a calendar app you'll one shot up a calendar app and billions of dollars will be spent on this like every month i would have said like okay well like i would expect that like my my the app from united airlines is less buggy and like i haven't experienced that i haven't i haven't been like walking around the internet using different websites and tooling and being like oh wow they did a complete rewrite on this it's so much faster or like oh wow there's no bugs in this thing or that thing it's like it's still very incremental like we really do have a lot more software to write because i do believe that the code's being written and like the product like internally every company is writing more code and doing more things but the amount of yeah i mean improve.
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Your experience is crazy there's a lot of ceo's and ctos and engineers that have come out and said ninety percent of my code is written by ai but they're they're still like it's not like they suddenly only need to work for an hour a day yeah it's not like okay we just need to do yeah we just need to do.
- [22:17]
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More yeah yep totally totally well if you're writing a lot of code with ai you need code review for the age of ai go to graphite dot de v graphite helps teams on github ship higher quality software faster teams like.
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Ramp figma asana cursor shopify speaking of.
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Like more we have a post from ara kharazian came on the show earlier this week he has the data on gpt five he says gpt five was good actually after a launch that led that led sam altman to apologize the latest ramp data shows openai is growing business adoption faster than any other model company tracked by ramp ai index it's also not just tech tech manufacturing is adopting ai faster than any other sector and it's why the consensus figures on ai adoption are probably wrong or the census figures which we talked about with ara and he says read read his full analysis on substack you can go to econ lab dot substack dot com to subscribe to our karazian and you should of course go to to tvpn dot substack dot com and subscribe to our newsletter so the ramp ai index the model adoption rate the share of us businesses with paid subscriptions to ai models jumped significantly in what is it this is probably march was openai's really crazy fast takeoff and then in july the data's up again it it this doesn't read purely as this this reads more as like people understanding o three and reasoning models and starting to pay also just more monetization tiers probably more ways to pay maybe but forty four percent of us businesses now have paid subscriptions to ai models platforms or tools across openai anthropic like an xai google and deep seq and the google number seems low since i would imagine that some of those gemini subscriptions maybe get rolled into google apps like because gemini just shows up in the google apps billing already we'd have to talk to ara and dig in more but i mean it's like the clearest piece of the data is that openai is on an absolute tear here in the b two b context which is interesting yeah and it's not like we're not seeing like oh gpt five sucked so it's falling off cliff it's like no like the models are getting better just like we talked about this with the iphone like if it was worse if it was worse they probably wouldn't release it they just stick with the best but anyway this is crazy this other yeah this is another pro chatgpt's impact and openai is like i guess like i could put this loosely in the bull.
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Case but so isaac says i met someone this morning who's number source of traffic is chatgpt supplement brand and has figured out how to get chatgpt to recommend the brand whenever someone asks about a specific problem crazy that is crazy i feel like i'm surprised we haven't seen more of this but it's just taken a while for not only chatgpt to get adopted to the point where it's statistically significant but then also people to figure out how to make it.
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Happen i mean you live the podcast boom firsthand and how long was it like podcasts had existed for years before we saw like ag one become like the podcast supplement brand right yeah and and there were a few other brands where it was like this their whole growth strategy was more sigmatic do you remember that four sigmatic for sure that's.
- [25:57]
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A great example i yeah my friends my friends had a podcast and i was in college at the time they were quite a bit older and when i met them they had one sponsor which was like some random coffee company that just like happened that the founder happened to be in the audience just reached out yeah was like hey let me like hey so so they they didn't they started the podcast without any real plans to monetize or anything like that yeah and i at the time it still felt like i was late to podcasting because there was a bunch of podcasts that that that i mean.
- [26:32]
A
You could say the same thing about direct to consumer advertising on on on like meta platforms like the the four sigmatic i heard do we hear the numbers together someone was talking and saying that so era was so crazy because.
- [26:48]
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It was like every you know a number of brands realized like hey you can buy like really cheap really effective advertising on instagram on instagram and meta platforms broadly and then and that allows.
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You to scale number of brands super.
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Quickly yeah it was literally like if you had a decent product and you had funding you could like you know scale overnight so many people realized that yeah so many people realize the opportunity and just flooded it and just auction so supply grew but demand you know for the ad inventory yeah i think.
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In the mushroom coffee category there are three or four different brands doing one hundred million dollar plus in sales maybe like three hundred million dollar plus in sales like there are some really really.
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Big yeah there's mud water mud water.
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Or sigmatic there's a two there's two others that i haven't heard of and you just see every time you hear.
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I heard it crazy yeah they went.
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From they went from zero to two hundred million dollars in five years i.
- [27:44]
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Heard a crazy story about somebody interning at one of the mushroom coffee companies leaving anyone getting this company was already at a nine figure revenue mark the intern left and started another one and then outgrew the original that's insane yeah.
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Yeah a lot of financial i do wonder what those companies look like in five ten years i mean we've seen when we talked to the ridge guys like top line growth is not the end all be all of d two c success like you have to generate cash flow matters and this takes time and so when you hear hear one of those like crazy revenue ramps especially in d two c you should always ask this even in ai but in d two c you really need to understand okay is there is this just the founder's good at fundraising and they're losing money on every transaction and they're just going to keep this flywheel grow going because they've figured out how to make their revenue steeper than everyone else and so they keep getting funded or is there something really special about the.
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Economic laugh something about unprofitable saas i mean it's it's like how are you going to sell software and lose money it's funny but like selling physical goods it's like wait you sold this mattress it cost you money to sell this mattress mattress yeah yeah and obviously there's plenty of cases of great companies that that were deeply you know unprofitable for for a long time but something about d two c companies you know running running in the red massively yeah it's like come on you should at least.
- [29:20]
A
I mean it's like lemonade stand stuff it's like as a kid you learn like buy the lemons buy the sugar get the pitcher and then add it all up multiply it by two that's how much you're charging it's like cost based pricing is like you know the most instinctual economic force in the world that like a child can understand and yet we justify all these different things and sometimes it makes sense sometimes it does make sense to lose money on saas for a little bit if you're building a you know some sort of network some sort of locked in thing some sort of high margin opportunity down the road anyway if you're growing your business you need to analyze some data get on julius what analysis do you want to run chat with your data and get expert level insights in seconds they're loved by two million users and trusted individuals well princeton bcg and zapier.
- [30:10]
B
Equally important we need to talk about profound in the context of chatgpt traffic yeah i would not be surprised if the company that isaac is talking about here that's getting all their traffic from chat gpt is using profound com it's in the back there you go i put it up on the reach millions.
- [30:27]
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Of consumers who are using ai to discover your products and brands get your brand mansion mentioned in chatgpt yeah whether.
- [30:33]
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You'Re doing whether it's consumer product that you're selling or enterprise software you need.
- [30:39]
A
We kind of like we kind of took the conversation in like a an almost like negative situation talking about like the long term durability of these businesses but i mean really this this is.
- [30:51]
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Crazy because it's it's organic yeah exactly it's like seo is sort of like faded in terms of important relevancy if.
- [30:59]
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You can if you can be the first brand to go and find the the correct strategy on instagram and dominate like that's such a huge advantage and it's the same thing with like how did airbnb get to scale quickly old school seo right they just had landing pages for every single you know rental homes in tulsa right and when you google it you go they're really good at seo there's a whole bunch of other drew houston at dropbox he was like we we copy pasted the entire like web two point zero growth handbook which was like give ten get ten paypal model of like yeah you know incentive based viral growth and with dropbox it'd be like i give you five gigs of storage i get five gigs of storage we add it all up and it just went super viral and they he said something like all of the all of the viral like the viral growth it's like you can go way deeper with that metaphor which is basically like as an internet saas company you need to be sneezing on as many people as possible which i think is hilarious so he's like he's like you know to get the viral coefficient up you need to be sneezing a lot and not washing your hands what does that mean in the dropbox context well it means when any whenever someone clicks a dropbox link there's a little prompt hey do you want to sign up hey put your email let's just grab your email before you view this pdf oh oh hello sign yeah we acquired them let's bring them in and oh if you want to sign a document like set up a dropbox account right like these are sneezing all over the internet is what he'd like referred to it as i thought it was.
- [32:37]
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Brill brilliant yeah yeah angel list has has done this well with with their rollup vehicle product right every time every time you know somebody gets invited to a rollup vehicle they create an angelist account they may maybe make their first investment and angelist can say like hey do you want to invest in this fund do you want to do this do that yeah do we want to read through this journal article at all do you think we covered it i.
- [32:59]
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Think we covered most of this basically the journal's asking about openai's funding challenges we ran through this yesterday and basically my conclusion was three hundred billion dollars to oracle is a staggering amount of money but it is in line with what it takes to build all the data center capacity for an amazon dot com comma a facebook an instagram like a meta platforms internal a google dot com comma not the cloud businesses and so i can see i can imagine the spreadsheet that that that they that they used to develop the model the question is will the growth continue i think they're on a fantastic growth curve it feels like this will that they will wind up paying a lot of this and that's certainly what the market's pricing in based on the pop in the oracle stock it's not like wall street looked at the oracle backlog and was like oh that's fake like this is bearish we need to sell the stock no they were like yeah that money's coming in three hundred billion is coming in over the next over the next half decade or something so like.
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Let'S i think that i think i think you can i think you can think that it may not materialize but still think it's a good investment in.
- [34:17]
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The short term sure but i mean.
- [34:21]
B
They missed purely yeah yeah but purely.
- [34:23]
A
Momentum maybe that's i think that's kind of odd it's kind of like a circular logic because i mean then you get into like you could say that about like anything like like yeah well.
- [34:35]
B
Like they they yeah i would say like a bunch of people a bunch of people are like wow yeah oracle is going to generate hundreds of billions of revenue from ai i want to own this stock and then i'm just saying there's a category of people that are going to say like okay this stock's going to run yeah at least in the short term but maybe it's nineteen ninety nine and and you know we're we're we're going to see some type of you know correction here so.
- [35:00]
A
We will we will find out we'll see i mean we'll we'll probably have more data on i mean as soon as oracle's next quarter prints we'll see exactly how much they're pulling down exactly how much they're building openai in the nas in the last nine months has committed to spend around sixty billion dollars a year for computing from oracle and this will really i mean if this pencils out like this will drive a radical transformation in oracle's business like you we saw the chart in the journal where their core business like everything that they've built up so far is basically expected to decline over the next five years as they switch to pure cloud computing like they want to be a.
- [35:37]
B
Hyper scaler eric newcomer this morning said seeing a forty eight year old database company suddenly grow by more than the size of salesforce over the course of a trading day is one of those occurrences that makes you wonder about the moment we're in it's at once incredible uncanny and terrifying like your grandfather during a family reunion gathering everyone around tossing off his walker and doing parkour good very very funny bit eric newcomer also was bearish on he was bearish on openai at around around thirty or at least like very skeptical yeah maybe a.
- [36:16]
A
Year or two ago he wrote kind of the bear case but i think.
- [36:19]
B
This is a very very fair.
- [36:24]
A
Yeah openai loses billions of dollars a year and has told investors it is on pace to make thirteen billion in revenue this year according to a person familiar with the matter less than three years since the launch of chatgpt openai is tying its fate to a belief that companies and consumers will increase their spending on artificial intelligence at explosive rates for for years to come and i do i do wonder like like you have to believe in the agent to commerce story to to to really see another like ten x in revenue how do they get to a i mean the project the the projection that people are underrating openai i believe is two hundred billion in revenue in like twenty thirty and and it's hard to imagine like am i going to pay two thousand dollars it's hard to exist is everyone.
- [37:11]
B
Going to pay pay to my soundboard would i pay yeah i want to hit the air horn so bad yeah yeah i i think you gotta monetize the users yeah you gotta users you.
- [37:22]
A
Can'T get all on twenty and two hundred a month plans maybe the example.
- [37:26]
B
That i always give is like the average american if they don't have a show they like on your streaming platform they will just cancel it yeah yeah like i mean like they're like sorry.
- [37:36]
A
I don't care just haven't upgraded haven't i mean people are just starting to experience like the reasoning models i don't know like i i if the if the if the paid plan stick around like it could be they could get a lot more people to convert especially if it's if it goes through your business if you're expensing it if like you know how much do how much how much money is spent on like email subscriptions across yeah it'll be interesting.
- [38:03]
B
An interesting comp is like do you think that that netflix or openai will have more subscription revenue in twenty thirty.
- [38:13]
A
I would say openai by mile yeah.
- [38:15]
B
And you think that's because people will pay to have this like all powerful assistant that can yeah i mean i.
- [38:22]
A
Guess i the only the only question is just like is there a better way to monetize like can you get dollar twenty or dollar two hundred of value out of someone by just handling their purchases than just doing the agent.
- [38:34]
B
Of commerce thing yeah you're not openai is not openai is completely aware that they're driving a ton of economic activity right i'm so happy that you're making millions of dollars from our product yeah.
- [38:48]
A
How exactly did you yeah like i'd like you want to keep this relationship going let's get cut and that's super valuable that's what that's how that's how meta generates so much money money and google too the scale of like internet commerce and taking a cut of all of internet commerce is extremely extremely it's just an extremely huge pool of capital to draw from it's a huge it's a massive thanksgiving plate to eat off of right and so openai deals that came to light in the past week have added up have added more than four hundred billion dollars to the market value of two companies chip designer broadcom and cloud provider oracle they also put oracle chairman larry ellison in striking distance of becoming the world's richest person oracle's stock market value jumped over two hundred forty billion dollars on wednesday after the company revealed a giant backlog of computing orders most of that is derived from a roughly three hundred billion five year computing deal with openai well if you are generating media you gotta go to fall ai generative media platform for developers the world's first the world's best generative image video and audio models all in one place develop and fine tune models with serverless gpu's and on demand clusters don't get caught writing a three hundred billion dollar check to larry ellison just.
- [40:08]
B
Gonna fall not today adobe shopify canva quora and many more are on and you should be there too did we want to tap through this dd was highlighting yeah story it's so crazy to look back at these like incredibly strategic acquisitions from from you know a decade ago couple two two decades two thousand eight so in two thousand eight apple acquired palo alto semi fantastic name really ahead of the curve if anything if anything they were they they created the trend semiconductor company really yeah the silicon company of palo alto it's funny is.
- [40:47]
A
There'S there's also palo alto alto networks and so i wonder if palo alto semi was directly inspired like oh well like we're in palo alto and we're doing something similar anyway you want to.
- [40:57]
B
Actually like this formatting they've just palo alto semi palo alto network more than the blank of blank so you'd just.
- [41:06]
A
Be new york browsers the new york browsers that sounds like a sports team the palo alto semiconductors the palo alto networks yeah the palo alto networks has.
- [41:15]
B
A sports team too we should just just rename our c corp to hollywood content inc but anyways anyway with the pet dee dee says few people know about apple's acquisition of palo alto semi in two thousand eight arguably the highest roi acquisition in tech history the two hundred seventy million dollar price for one hundred fifty engineers laid the foundation for all the apple silicon chips you see today that have generated over five hundred billion in value to apple and anyways he's highlighting an article from two thousand eight an apple spokesman said apple has agreed to buy boutique microprocessor design company called pa semi the company which is known for its design of sophisticated low power chips could spell a new feature for apple's flagship iphone and possibly ipod products as well that is crazy these kind of acquisitions have created the set of circumstances that allow ceo's to justify these like un like absolutely insane because when you get an acquisition right the return is is can be as good as a as a you know seed to unicorn you know venture investment yep and so but when you think about like the instagram acquisition the youtube acquisition palo alto semi right these were different.
- [42:30]
A
I just feel like there is an alternative scenario where they don't they don't buy psammy instead they're just like poaching and and hiring one hundred and fifty people and it takes them like three years to get there but they eventually wind up doing it but maybe there's like important ip i don't know i wonder what do you think two hundred seventy eight million dollars is in today's startup economy like if you go back to two thousand eight two hundred seventy eight million dollars feels like a blockbuster acquisition to me this is totally that's what i'm saying yeah but but is that is that a ten million ten billion dollars acquisition two billion dollars acquisition.
- [43:11]
B
Like yeah it's funny that like m and a has like actually outstripped like inflation well one hundred percent when you.
- [43:18]
A
Look at scale ai right it was a twenty almost twenty billion dollars deal for half the company yeah and so i so i wonder like we have we really had one hundred x increase in in valuations basically this makes me want to go dig into apple's recent acquisitions because remember on the earnings call tim cook said hey yeah we're actually acquiring a company like every few weeks like we've done basically one a month this entire year yeah and everyone's been like oh it's boring like who cares like like these they're not doing they don't they're not buying anthropic or they're not buying perplexity for ten billion but if they have a pa semi in the in the portfolio right now and we just have a night clock yet like that's going to be amazing yeah.
- [44:04]
B
So biggest m and a i'm on on gemini biggest m and a of the of two thousand eight two thousand eight was hp acquires electronic data systems okay it was the biggest thirteen billion.
- [44:17]
A
Dollars deal like a huge merger of.
- [44:19]
B
Massive companies oracle acquires bea systems which was a business software company i'm not familiar with i love business software me too six point seven billion google acquired doubleclick for three point one billion that.
- [44:33]
A
Was the huge acquisition yeah which in.
- [44:36]
B
Hindsight like you know it became the background incredible acquisition yep and business objects was acquired by sap i like business.
- [44:47]
A
Objects that's a good name no makeup.
- [44:50]
B
Yeah we don't know how to name.
- [44:51]
A
Companies like this anymore that's so good.
- [44:55]
B
The business company there was yeah a ton of like multi billion dollar m and a that year but it does feel like if apple were to acquire make a super strategic acquisition today i mean they were who knows how real like the perplexity rumors were right they were you know apple was under pressure to make an ai acquisition but but it didn't feel like apple would ever get to the point where they would buy perplexity for eighteen billion or whatever they wanted out of it this is odd for it was like when you.
- [45:24]
A
Look at an application layer company they really don't buy a lot of applications i mean they bought shazam i believe but a lot of times they're what they're buying are these underlying hardcore teams that are going to create the foundation of the next hardware wave for them them like in the lead up to the vision pro they acquired i mean you know you know someone who sold a company to them that went into their vr portfolio correct like like that is the apple playbook is we have a vision we're going to do vr or or augmented reality in a decade or we're going to do car or we're going to do custom silicon and so let's start hiring acquiring little little investments here and there here and there and here and there they're not just going to go out and be like we're trying to buy what waymo or like we're trying to buy the the best asset they're kind of the opposite.
- [46:14]
B
When they bought beats for yeah zero point three billion beats was doing like one point four billion of revenue sure trailing twelve months yeah exactly again it was a very you know so running.
- [46:28]
A
Semi acquisition dd has the story pa semi special specialized in power efficient chips with power pc chips that delivered three hundred percent more more performance per watt than intel xeon at the time which i believe was their server chip founded by the late dan doberple dec alpha and strong arm legend in two thousand three the team had expertise in low power architecture that intel couldn't match the acquisition gave apple the dream team that would create the a four chip in twenty ten launching apple silicon dominance key engineers like jim keller g williams james iii and johnny sruji architected the a series that powers two plus billion devices today crushing qualcomm's monopoly this philosophy evolved into the m one's twenty plus hour battery life that's powering this laptop right.
- [47:18]
B
Here are you getting twenty hours out.
- [47:21]
A
Of that bad boy i'm plugged in right now i'm not risking it while we're on the stream but i i think we could maybe get twenty twenty hours if i was you know low low dim screen brightness and maybe not connected to the wi fi and maybe just in a text editor with a dark background the whole time and it also had a three point five x faster performance than intel at one third the power the m line of chips today powers macs ipads and vision pro without pa semi there may never have been an iphone processor independence ipad dominance no apple silicon macs the small investment a series a right re a round a series b round today has generated five hundred plus billion in value strategic acquisitions like this can make the break make or break the future of a business and if you what else turbo puffer it's on the skits we puffing we're puffing search every bite serverless vector and full text search built from first principles on object storage fast ten x cheaper and extremely extremely scalable pretty much.
- [48:23]
B
Used by every company we've been able to find there's a bunch of logos that they have that are absolutely crazy that they don't even they're not even listing on the website so a lot more to come from turbopuffer in the near future but for now get on.
- [48:39]
A
It did you want to go through this post by ajni midha andreessen yeah.
- [48:44]
B
I thought this was i thought this was a couple things you could read into this so many v he says many vc firms are being asked by their lp's how they so utterly miss the entire twenty to twenty five cohort of frontier ai startups that are now category winners worse they're being asked by the same by next gen founders i've never seen so many traditional investors become obsolete so fast it was like if you think about if you think back like the twenty twenty twenty through twenty twenty five you had zirp where just every category was going crazy and then you had like like fintech was super hot crypto was super hot it was easy to get kind of like if you were a generalist vc a lot of generalists like decided i'm gonna go just be a crypto investor yep or or i'm gonna focus really heavily on fintech and then you also had the the sort of american dynamism boom which people were were drawn to in different ways but when you look back at when some of these leading ai companies were started it really was like twenty twenty two during like a time where if a lot of vc's were like trying to do like basically damage control on their portfolios right they had funded a bunch of companies at insane multiples we started seeing you know a real kind of like correction in in in venture and and if if you just like weren't really didn't have your eye on the ball and weren't like seeing kind of the future you missed a.
- [50:19]
A
Lot of yeah and when i see when i think about the cohort of frontier ai startups who do you put in that bucket in that cohort twenty twenty to twenty twenty five like if you're a if you're a traditional investor that doesn't want to become obsolete what logos do you want on your portfolio page well so that signal to the next generation of founders and lp's that you did not utterly miss the entire twenty twenty to twenty twenty five cohort.
- [50:49]
B
Of frontier ai startups first example that came to mind was like listen labs right six billion dollars company now started in twenty twenty two seems like you know seems very obvious in hindsight but if in twenty twenty two you had like funded you know fifteen fintech companies and we're trying to figure out what was going to happen to them as interest rates were spike you know spiking and and you were distracted by crypto you just like didn't you know you weren't there were people that were locked in on ai right the people that i the people that i that come to mind is like people like a lot gill who are in a lot of these companies right the the a lot of the platform funds like i mean obviously anjane at at andreessen is is there in a lot of these companies but they're multi stage right so it didn't matter you didn't have to catch them at at series a or seed although they they caught plenty and so and then the other thing is like like if you're not in if you're a platform vc and you weren't in any of the winning foundation models yeah like what what were you doing.
- [52:04]
A
Toastla has a fantastic story around early openai thrive has a fantastic story around early openai then there was that first like pre like right around the right around the moment chatgpt happened i remember there was a big round and a lot of investors got in there and it was around it was in the tens of billions and it was a crazy valuation to kind of come out of the gate with there was already this microsoft deal it was a complex thing you had to take a ton of risk on the nonprofit for profit conversion but yeah there was to be.
- [52:40]
B
Clear there was plenty of reasons not to do openai one hundred percent like whether it was pricing the structure there.
- [52:47]
A
Was a meme about the model the foundation model layer will commoditize right yeah and so if you fell for that meme you are not in and then.
- [52:54]
B
There was the meme of like the application layer there's no value there was a period where people fell for both that was like a mid curve both of them and then you're sitting here you got no foundation model bets no no application layer bets and you're like well even the new foundation models are too expensive i can't do those and then this company is just like trying to fast follow that company that already.
- [53:21]
A
Broke out so i mean when i think about the twenty twenty to twenty twenty five cohort of frontier ai startups yeah i think eleven labs fits in there i think mid journey no one got into i think i would put deepmind you couldn't invest because that was google but it's got to be openai anthropic or a few of the other major like like application layer companies that have done very well and if you're in those even if it was a growth round and you got in later if you at least built a position and have something going on there it seems like you kind of check this box but it is it is an interesting it is an interesting question to to phrase you gotta you gotta buy fifth ave sometimes that's right linear linear is a purpose built tool for planning and building products meet the system for modern software development streamline issues projects and product roadmap i think linear i think.
- [54:18]
B
All the breakout ai companies are already running on linear and you should too.
- [54:24]
A
Well we have some news from dylan patel over at semi analysis another giant leap nvidia rubin cpx specialized accelerator and rack inference pre fill specialized gpu dylan says nvidia has widened the gap for inference rack scale architecture yet again pre fill specialized inference chips massively lower total cost to own per million input tokens on long context transformers as usual other ai chip upstarts will follow this with pre fill specialized chips but later and so yet another bullish take for nvidia everyone's competing following the amd story has been interesting dylan's been been pushing amd to fix some of the bugs get more serious about ai really talk to the developer community engage with the developer community amd was doing that was seeing some some some positive early signs of being taken more seriously george hotz was on the team a little bit but but has since like pulled back and you know jensen sees semi analysis too and can see oh amd is coming for my lunch i'm going to step on the gas and it seems like he has so congrats to everyone over at nvidia for putting on a putting on an absolute clinic clinic in rap.
- [55:42]
B
Jack fields says while he's quoting sam there's not a single person in the world who needs a two terabyte iphone seventeen pro max jack field says slaps car roof this baby can fit so much other in it is that a thing like yeah if you look up if you look at like storage there's like a category called other and is.
- [56:04]
A
It big is that just usually eyewear.
- [56:06]
B
It usually is it's a bad sign.
- [56:09]
A
If i have other going on i have a one terabyte iphone and i don't have any other i have no other my my my phone is applications and then other i think i'm looking.
- [56:24]
B
Now i don't i don't have system data i don't have it anymore but there it used to be oh little throwback it used to be the other it used to be a much bigger.
- [56:32]
A
Well they've done a lot better exposing where the data is actually stored i think you know the two terabyte phone that feels like it's for someone who.
- [56:42]
B
Mister beast filming you know his entire.
- [56:45]
A
Yeah and specifically the new phones forty eight megapixel cameras genlock so you can run them for a long time better heat management so you can probably record for ten hours if it's plugged in no problem and then you're saving all that footage and you can record in raw video now raw so that those are huge files so there is a world where if you're using this as a production tool i saw another take that was like the the iphone seventeen pro gets you ready for the two thousand dollars iphone like the like mentally that's a that's a threshold that's a rubicon that everyone has to cross and and and maxing it out and offering that level of performance and saying hey look we put pro on it like you have to be using this in a professional context yeah you should be expensing this and for someone like mister beast who says yeah i want to.
- [57:34]
B
Camera company just being like where apple's not a you know threat like they're really they're really you know he might.
- [57:40]
A
Be placing that with a iphone soon.
- [57:43]
B
I i think the watch out sony watch out sony tim cook wants your.
- [57:48]
A
Lunch he's cooking he's cooking naveen rao is leaving databricks a little bit of a trade deal one hundred billion dollar startup to build a next generation computer to shrink ai compute costs and databricks plans to invest that's bullish databricks sits around one hundred billion dollars and just raised one b they're also at a four billion dollar run rate congrats to databricks which we had our gong the core problem for the ai industry is that large models are limited by memory bandwidth internet interconnect latency and power so every token can be produced can be too expensive a purpose built computer may tackle those costs by bringing memory closer to compute wiring chips with faster length is this data center focused or or something that would actually sit on your desktop is this a george hotz tiny box competitor i'm not exactly sure but congrats to naveen rao on the new gig we will be following the story and monitoring the situation big move we'll.
- [58:44]
B
Try to get them on when you.
- [58:45]
A
Sell those computers make sure you're on numeralhq dot com naveen sales tax on autopilot spend less than five minutes per month on sales tax tax compliance otto.
- [58:54]
B
Van von tweet mark tweet mark says can you short an entire country referring to albania albania is appointing an ai generated governor government minister to govern the country's finances apparently they've had so many issues with with with like corruption and fraud they're just like let's just like.
- [59:14]
A
Make an ai yeah no one's gonna no one's gonna prop in jack the.
- [59:19]
B
Top comment is their their alternative is an albanian i don't i've never really i i don't i don't think i know many albanians has some wild stories.
- [59:32]
A
About going to albania i believe i don't want to dox too much but he has some he has some funny stories hopefully we can get him to share them on the show the idea of like let's just use an ai to to to like clean this up it's like that's who's prompting us it like are they reliable well what if.
- [59:50]
B
They'Re i mean mir maratis albanian yeah albanian american so they could get thinking.
- [59:55]
A
Machines it would be a pretty crazy story of what's it called sovereign ai it'd be a sovereign ai story i.
- [60:01]
B
Don'T know i don't know if they're claiming that it's that it's their national champion yet albanian american yeah.
- [60:09]
A
Well if if someone in albania needs to chat with someone about their tax return maybe they could get on fin ai the number one ai agent for customer service number one performance benchmarks number one in competitive bake offs number one ranking on.
- [60:23]
B
John i've been i've been informed that back home in the studio the whole team is clapping along with us during the during that during the hopefully we.
- [60:31]
A
Could be audio mix in and everyone everyone goes for it gary tan had a post ai startup founders tout a winning formula no booze no sleep no fun but gary tan disagrees about the no fun though and this is from the wall street journal san francisco this.
- [60:48]
B
Is the vibe right now startup founding.
- [60:49]
A
And we talked to a few of these folks one of these guys came on the show just at yc domay actually so fascinating and and this was this was the second this was clearly like a a story that was inspired by that previous story of that that founder who said that the vibes nine hundred ninety six no run hard lift heavy marry early that whole that whole viral quote this is probably like downstream coverage of that but in san francisco star startup founder marty kousas was at the office on sunday where else would he be ka is twenty eight years old recently posted on linkedin that he put in three ninety two hour weeks in a row he went on vacation once he said but flew home early because he was too stressed about work his goal is to build a ten billion dollars company in ten years the motive isn't purely financial there are easier ways to make money money this it isn't part of a social mission either we built customer support software it's not like this grand vision that we're saving the world somehow he compared his pursuit to a board game one he wants to win i could be a programmer working at a big tech company he said but that doesn't sound cool instead he raised fifty one million dollars for pylon an ai startup he co founded congrats s gong for that yeah i was just reflecting on this this this whole vibe and the coverage of this vibe and thinking about when i got to s valley and what was similar and what was different and so you.
- [62:15]
B
Didn'T have a pr person working over coverage that was your mistake john i know you only raised like seventeen grand.
- [62:22]
A
In your first round raised seventeen thousand dollars and there was no concept of going to the office because the office was my bedroom and my co founder lived in the same bedroom as me so we had two beds in the same room and we would wake up and go sit at the same desk next to each other that's like a.
- [62:40]
B
Real lock in because you don't even have a private life right like there's.
- [62:45]
A
Nothing you have nothing nothing it's purely like there was there's one local bar that we went to once in sunnyvale because there was nothing to do but we would we would go outside and we'd throw the football big skin yeah the pig skin we would go outside and get some sun and throw the football back and forth and then go back inside and just program and my and my day was literally like wake up at noon and because you don't have any calls wake up at noon program until four am fall asleep do the same thing the next day seven days a week and there was no there was no alternative and there's other like we were also in this weird i mean also i wasn't twenty eight i was i was twenty one at.
- [63:23]
B
The time it's funny because saying like i put in like three like obviously respect to marty but saying i put in three ninety two hour weeks is another way you could say like like for the last three weeks i've slept and ate and done normal human things for about twelve hours a day yeah and the other twelve hours i spent working yeah it doesn't hit the same.
- [63:44]
A
As three you know yeah it is it is it is wild but i don't know i mean in in general like if this is a if this is there was there was a time in silicon valley also that you could raise enough money that you could just immediately be on like a party circuit and like clearly this is a step in the right direction away from that it's like actually taking business seriously so hugely bullish overall it's just funny like thinking about like like the money flowing like there were not that many companies that in twenty twelve that were raising like double digit millions but then there weren't that many companies making money like we certainly weren't we had no users so like who was going to fund us like seventeen thousand dollars was the right amount of money to give us like and also also like it's not like we were being recruited by big tech like if i tried to get a job there you're like no the.
- [64:35]
B
Capital markets were efficient they were they.
- [64:37]
A
Were like i didn't deserve more than seventeen k i wasn't that experienced like i was just trying to you know like do something build build a one.
- [64:45]
B
It is a it is a you know it's very real that like a lot of founders would benefit from like having their first fundraise be like a hundred thousand dollars which is just enough for them to like hack for two years and not have to get a job job but the current the current state of the capital markets means that if you're like talented and charismatic and compelling and you have an interesting idea you can get at least a million probably well beyond that yeah yeah yeah at demo day like it was very obvious yeah for the most part when you could tell i pretty much was guessing every time i was like let me guess your rounds closed yeah i.
- [65:23]
A
Mean yeah in twenty twelve like i think they were probably like like five or ten teams that like raised solid rounds coming out of like an eighty team batch like it was it was not it was not snap your fingers and the money shows up the i mean the hottest like most overheated round was done at like sixty and everyone was like this is a bubble this is insane there's one company what company was it it was a company called viul and they were actually really good at viral videos and they they were great at video production and they built an ad network and were doing sort of like some programmatic ads so it was more like an ad business than like i don't think they ever fully stuck the landing on like becoming like a major platform like i i don't think that they ipo'd or anything i know the founder's done quite well and has i think a number of businesses but they they launched a few like extremely great launch videos they i feel like they almost you could almost go back and credit them with like creating the original launch video you should look up v i r o o l like launch video on youtube v i r o l virule yeah vi vi r o o l and the whole idea was like they would get you to go viral and so you would pay them and then they did still.
- [66:41]
B
Come i mean it's still still going.
- [66:42]
A
It'S still cooking well alex debalov i believe is the founder great guy so.
- [66:47]
B
I'Ll have fifty linkedin says i don't know this company looks pretty dead okay well but i mean oh it's it's now called called i guess it was.
- [66:57]
A
A i mean the founder it was super young and and i met him in college and it you know was just like he really was the type of person that you would want to fund at sixty because like he was making money in his dorm room like hand over fist too like had actually scaled the ad network and was like bringing in real revenue and real profits it was just maybe like it wasn't necessarily going to turn into like you know adwords because he didn't have like a google attached to the front of it it's still like super impressive business right but they had worked with this video production company called gl marker which i wound up working with later sort of like a precursor to sandwich video a precursor to jason carmen production and was particularly good at at creating this like just super cinematic like hollywood level video production for like a launch video and they they they put out a few that were really good i remember that like swat team going in pulling in like this like blue this like blue goo that was like radioactive and it was like you got to get the formula to go viral is great are you throwing them on there you're throwing them on there virule v i r o o l alex debalov if you want to come on the show and tell us the full story hit me up the moon probably the moon well yeah they were going to the moon yeah the other funny thing that i like is this so like you know these teenagers that they interviewed said the brass ring is a trillion dollar company with a global user base to grab it they rarely drink scoff at work life balance and are locked in a twenty four seven competition to be or appear to be the most obsessed there's a framing there's a one framing which is like i don't drink because it's like i've done the research and it's a carcinogen it's bad for my health there's another one which is like i don't drink because it's like sacrificing because i care about work for me and my friends is like we would drink every drop of alcohol that we could afford it was just not that much so we had like three beers a month month because like that was what we could afford and we and we did not it was like yeah like if you're going to costco and getting like a huge box of ramen like it's going to be a consideration if you take the thirty rack in the in the bag that's going to hurt your burn rate when you're on seventeen thousand dollars for six months like an extra thirty bucks in beer is like material yeah it's it's a serious.
- [69:18]
B
Yeah i was hacking chipotle you know with the like double beans double rice because it didn't add anything and then.
- [69:24]
A
Then you're not being like yeah throw a corona in there with my with my meal at chipotle no way but.
- [69:30]
B
I used to go to i used to go to this is will be funny to you now but i used to go to the the first like twenty trips i took to aran i didn't go in the building i would just bring jugs of water to fill up in this thing outside and i'd pull up with my car that had like two hundred thousand miles on it and just like just be like you know carrying these huge jugs of water.
- [69:52]
A
Yeah fond memories here's here's the trade off why would i go to drink at a bar if i can be building a company i mean it is the right trade off and it is the thing that you don't want to lose as the capital markets need to loosen right this is such a this.
- [70:09]
B
All the people that are screenshotting this article why would i go drink at a bar if i could be building a company company that is a really.
- [70:18]
A
Yeah it there is a little bit of this that's like that's like the whole the whole question the wall street journal is clearly asking here is like.
- [70:25]
B
I don't even like i don't like bars and i don't like drinking but this is still a funny quote yeah.
- [70:30]
A
Yeah no i i understand what you're saying and i understand what people are screenshotting it about but the the the interesting thing is like if the money starts flowing in silicon valley like the thing that you would definitely not want to lose is like the time in the the office like the time actually working like that's the worst thing to lose and so and yeah even even if you have to justify it in this like you know psychological way yeah it's it's good not to lose that yeah because as soon as you actually go to the bar every night like.
- [71:02]
B
Definitely not building yeah i was thinking i was thinking like like i've always felt i had you know somewhat of a balanced life right i have a we we we realistically we work like sixty hours a week and that like we leave home at yeah somewhere around five it's pretty balanced get home around five thirty and then obviously working randomly on on you know nights weekends et cetera but i was thinking you know people say like social life work like you know family like pick two yeah and i realized recently me took me a while to realize like how much i sacrifice like my like social life right because i feel like i have a social life at work and i'm lucky that a lot of the people obviously consider every person on our team a friend and and the people that i invest with are friends and the people that i work with are friends but yeah you do have to this this is just this culture of like sacrifice everything but the company works really well when you're twenty when you're when you're in your early twenties mid twenties depending on when you i think we.
- [72:12]
A
I think we found the ultimate killer in this article hassab ullah he works at a founders inc a waterfront campus in fort mason that provides desks a hardware lab game room stage area for hackathons he lives on one uber eats meal per day to save time and avoid cooking oola pays seven hundred a month to live at a former office building that was converted to a living and workspace for about twenty residents the beds which are clustered in a common area are fully enclosed pods he literally lives in the pod with a privacy curtain similar to a trained sleeper car with the curtain shut his pod gets pitch black letting him sleep days after working all night this guy is a killer i'm betting on him him i love absolute dog this is not a larp seven hundred dollars a month is so little to live on in san francisco i assume that's where this is founders inc fort mason he's living in the pod he's living in the pod he's locked in it is funny it.
- [73:09]
B
Is funny to do to do to this guy you would think he could maybe eat two meals if he didn't do uber eats and he just walked to to grab some food but maybe.
- [73:17]
A
Too locked in too locked in yeah i i think it's probably worth the trade off off but yeah i mean.
- [73:24]
B
This is still i gotta put i gotta i gotta say like getting delivery is still an extreme luxury still a luxury back in back i would not when when we used to when when i i would not let i was like on a like once a week like treat yourself to to chipotle type of thing and otherwise it was like yeah there's we have like chicken breast and rice at home no no no like you know i buried my own head being like deeper ways you know the meme of like your your your mom says you have you know x y z at home but that was like in my own head i'd be like i have food in the fridge i'm not i'd be and i'd be guilty you know being you know ordering.
- [74:05]
A
Ordering no i remember one one one night i was up like really late working i boil some water in a in a pot to make ramen and i and i got sucked into a coating problem and i let the water boil and evaporate and it destroyed the pan and it was like that's our capex out the window devastating hit to depreciation like we were expecting to depreciate that asset over two years and now we have to buy another pan like what are we going to do we don't have a pan pans are expensive money doesn't grow on trees where you know we only have seventeen k is rough.
- [74:45]
B
Causes the the guy the original guy from pylon is on the brian johnson diet okay so well he's raised.
- [74:53]
A
Fifty one million dollars to be clear i do think that like all of this is proportional like if your business has grown to the point where you can raise ten million or fifty million like you do not be you do not need to be living in the pot like pay yourself a reasonable wage as soon as we raised real money and we're making real revenue like we were in like decent apartments with cleaning and like with like and it's amazing.
- [75:15]
B
To feel like you you you have like a relatively the the lifestyle of like a corporate athlete or or even just an entry level corporate athlete but it still feels like a massive luxury one hundred like my my eight hundred.
- [75:27]
A
Square feet in a when i when.
- [75:29]
B
I yeah when i first moved to la i had a apartment my apartment it was a it was a two bedroom apartment that i i had a roommate so i felt lucky to have my own room but i had no windows in the room because the window opened up to like a common area at eye level so if i had my if i didn't have like i literally put cardboard up if i didn't have cardboard up people would just see into my bedroom i was like and then that's hilarious super dark but this this quote is hilarious he said his ideal employee for a sales role at the startup is a quote unquote phd poor hungry and desperate that that's good.
- [76:10]
A
Grinders you gotta get grinders people that want to be on the on the.
- [76:13]
B
Upside yeah there should be a term for somebody who fasts until their next like steak sales dinner it's like they only eat when they're closing i only eat what i'm closing like a real hunter on the this savannah is pretty.
- [76:28]
A
Crazy nico laqua twenty five twenty five years old wants to build a trillion dollar company with the goal of replacing traditional insurance companies his father is a lawyer from the insurance company so he only hires people willing to work seven days a week of his forty plus employees around thirty are ex founders that is a crazy stat just because like it really speaks to the to the amount of founders that exist in the bay area now like in in like you could not i mean this happened like or are you familiar with the y scraper instead of the sky skyscraper there's there was a this is in maybe two hundred eight twenty ten there was one building where all of the yc companies lived after they graduated from mountain view and went to san francisco they called it the y scraper and and there was and there was enough of so you have you have stories about like coinbase working right next to the airbnb guys i don't know if that's exactly right but like you you could imagine a few different big companies coming and it was like if one company failed it would just be like okay come over to this company like join forces but but you couldn't necessarily do that to the tune of seventy five percent of the workforce in the first forty that's that that that feels new and it feels like a an example of how totally how much more popular entrepreneurship is these days says he lives at the what he lives at the office lacqua said who considers himself the most hardcore of his peers employees share similar feelings though not a work requirement laqua said two thirds of our early employees got corgi tattoos that is hardcore wow that's great i have no tattoos i've never been big into that world but that is certainly a commitment hopefully you own the ip so interesting.
- [78:23]
B
This company i'm on nico's linkedin and this is a stealth startup still well he's not no you're not you're in.
- [78:31]
A
The they're getting tattooed you're in the.
- [78:33]
B
Journal and you're tatted up i think you're safe to come out of stealth.
- [78:36]
A
Yeah hopefully you have the ip locked up i went through yc with a company called pear that was a i think it was like an app for you and your significant other and so it was imagine a social network basically all the features of imessage you know how now in imessage you can like see all the photos that you've shared between you and one person so i can pull up like our imessage and i can go into that info panel and see like here are all the links that jordi sent here are all the images i can send you little stickers and all sorts of different stuff pair was that for like a romantic couple so you could like draw to each other had all these like fun little games and stuff um and pear wound up getting sued by pear networks and they were like whoa whoa whoa like we are a consumer dating like messaging app for like a husband and wife to share their life together you're a networking company parent networks like you sell into data centers like why are you suing us and they were like no you're a technology company we're a technology company you have to change your name yeah and so they did and they became couple and it was like this huge huge difficult thing so so anyway the importance of getting your name ip locked down before you gotta get.
- [79:51]
B
The tattoo we have an important ad so senra's in the in the youtube chat says can we get founders podcasts on the board absolutely we didn't add you because this was so schizo but.
- [80:03]
A
You are really the godfather of podcasting created the cat i don't think i don't think we can see up there i don't know what to have to see we can't see you up there you have a ton of space to your left though so get down and go keep going to the left past vibe coding and past discord to the left past larry ellison that whole area you got like three feet to work with over there you can draw massive stuff there we go here we go oh yeah this is good going downwards this is perfect okay okay i'm i'm seeing everything we're good lockwell regrets getting his columbia university degree he said because he wasn't solving societal problems in class i always want to do the maximally ambitious thing i can think of and make the biggest impact possible yuan the corgi co founder said her life too centers around work which across the startup scene is populated largely by men from a personal perspective i don't mind it as much but it does suck to see not that many women in startup startups jared friedman partner at y combinator said the work ethic and energy of san francisco's young founders feels like a return to the early days of the internet and i agree with this this is a great take when people slept under under their desks at companies such as paypal i actually see it coming as a as a full circle moment ai is probably ten x as big friedman said the tech yeah i mean.
- [81:26]
B
It'S very helpful if you have you know five to ten other heavily funded companies in your category and so capital is not really a constraint for anyone yeah and it just comes down to.
- [81:37]
A
Raw execution do we just conference senra in right now on this yeah we.
- [81:41]
B
Gotta ask him about i gotta call.
- [81:44]
A
Center and get him get get him tell us about the sleeping under your desk should i give him a call center let's see let's see if he's available i'm i'm calling him i'll put him up if he's available he's in the youtube chat so hopefully he can come on the show i totally emphasize.
- [82:01]
B
Hey how you doing you're live did.
- [82:04]
A
You need to call me yeah yeah you're live we saw you in the we saw you in the chat we.
- [82:08]
B
Got natalia happy friday we're doing a.
- [82:11]
A
Whole deep dive on this wall street journal article about the young founders in san francisco who are working twelve hours a day six days a week there's a bunch of examples yeah so we.
- [82:21]
B
Wanted to ask you is hard work.
- [82:22]
A
Important or is it overrated wrote an.
- [82:26]
C
Article about people working part time no.
- [82:28]
A
No really hard and the article focused on the article is framed as like is like are they working too hard a little bit or like is this a larp are they pretending and we wanted to go to the source and get the get the final answer.
- [82:43]
C
They.
- [82:43]
A
Do with the other that's what jordy.
- [82:45]
B
Says i said it's like put differently they're they're spending eight hours a day sleeping four hours a day you know.
- [82:52]
A
Want we're doing whatever they want netflix.
- [82:54]
B
I guess i'm like what would i what would my what would our lives look like if we didn't have five kids it's crazy like and wives that we i don't know yeah dearly sorry.
- [83:04]
A
That'S part time buddy nine hundred ninety six is part time breaking david senra has called it working nine hundred ninety six is considered part time in the founders podcast world.
- [83:16]
C
Did you guys ever i know you're into like bodybuilding did you ever read the education of a.
- [83:22]
A
Bodybuilder by no i should sounds fantastic.
- [83:26]
C
Okay so somebody posted like the great lock in and it's just like nine.
- [83:31]
A
Episodes of founders yeah oh i saw.
- [83:33]
C
That i think so one of them i think is arnold so arnold wrote two autobiographies one we use is seventy which is fine yeah but the way more extreme one he wrote when he.
- [83:43]
A
Was thirty oh wow that's young so.
- [83:47]
C
The first half of it is really like one hundred and ten ten page biography right and then the second half is like his workout routine which is like another one hundred pages but basically he would you know people were just like yeah i work twelve hours a day like so what else did you do with all the time.
- [84:05]
A
Wow yeah.
- [84:06]
C
That'S awesome i i don't want to get kicked off stream but he tells so i'm going to do the pg version of this this is before he made it to america right yeah so he would go to like him and his other bodybuilder friends they'd go to like this forest out in austria or maybe in germany and they would bring a bunch of women and they'd bring a bunch of like beer and food like schnitzel or whatever that is schnitzel okay yeah and they would essentially like go out there they'd strip off their clothes and they would like lift like tree trunks and they swim in the.
- [84:39]
A
Lake or something in the lake and.
- [84:42]
C
They were just essentially just work out all day i was like this guy's.
- [84:46]
A
Incredibly extreme workout all day who's the who's the hardest working founder purely by hours working hours spent working on a single company that you've ever studied elon.
- [85:00]
C
Probably because if the the how elon thanks for reading and covering that episode.
- [85:05]
A
It'S so good good you guys did.
- [85:07]
C
A good job on it but it was awesome so there there actually had a really interesting conversation recently with somebody everybody knows who's been a founder for multiple decades and i and he he came up in the technology industry and.
- [85:20]
A
He'S been there forever sure and i.
- [85:21]
C
Actually asked him that question i was just like who's the greatest like entrepreneur you ever dealt with or like you knew about and he's like listen you might not like them you might not like working with them but it was undoubtedly without hesitation a young bill gates young bill gates that would be my other answer if it wasn't elon yeah from the time they started microsoft in that little strip that little strip mall in albuquerque new mexico yep the guy until he left the company like i don't think he did a single other.
- [85:52]
A
Thing do you think about bill gates hardcore founder mode era was defined by his ruthlessness with regard to deal making or actually the amount of hours he spent in the office like have you heard stories about early microsoft being this nine nine six culture working twelve thirteen fourteen hours a day or was it strictly that when he went into every single negotiation he was willing to do anything to win.
- [86:23]
C
Like he's not working twelve hours a day do so i'll give you a preview okay i'm the next episode i'm working on right now is about a young bill gates it's gonna the title has to be something with hardcore because yeah so he would work thirty six hours straight until he couldn't literally stay awake and then he just crash and sleep in his office for like a few hours and pop.
- [86:44]
B
Back up that's hardcore that's i don't want to hear about oh i slept i got a good night's sleep i'm a grinder but i got great night's sleep last night yeah so like let me oh oh you're a grinder let.
- [86:58]
A
Me see your sleep score better be in the single digits better be in the single digits let me tell you.
- [87:05]
C
One of the funniest stories about bill gates so the best book written about him is it's called hard drive bill gates in the making of microsoft empire so the same guys that wrote that essentially it's about it's a biography the first thirty five years of his life then they it was so successful well they wrote a follow up the follow up book is not good but there is a story in the follow up book that is one of my favorite bill gates stories of all time and the the thing i the thing i would say about bill gates is like he has a ruthless competitive drive that would terrify people and so one of his main competitors is this french guy i can't remember his name they would like you know they were going to war over and over again and they would go they the only time they like interact they'd find themselves at the same like computer conference and so he he sees bill gates sitting on a folding chair in the corner of this computer conference alone looking at something and remember this they're like head to head competitors you know now this guy's completely disappeared and so he goes over and he wants to say hi to bill and then he walks up to him and he realizes that bill's in the corner by himself staring at a picture of the guy.
- [88:15]
A
Of his competitor he's just assessed yeah yeah yeah next time i see you i'm gonna make you know my profile picture when i call you your phone's background remind you remind you of me constantly.
- [88:40]
C
Hard drive the way i described him in the first episode i made about him on episode like three a long time ago is that bill gates is genghis khan in a mister rogers costume yeah that's wild.
- [88:54]
B
There'S a few ways to read that.
- [88:58]
A
That is that's hardcore that is that that is hardcore yeah well thank you so much for giving us more context on on what it means to hardcore be hardcore and grind in an entrepreneurship context hope you have a fantastic rest.
- [89:12]
C
Of your day thanks for calling me and i'm just going to say publicly what i said to you guys yesterday after seeing what you did in new york stock exchange i'm super proud of you guys thank you you're absolutely crushing it i just don't i don't think you'd have any kind of limit at all very curious where you take this.
- [89:25]
A
For years thank you brother we'll catch you up soon see you love you bye and always good guest even when you thought we weren't going to have.
- [89:35]
B
A guest they said we couldn't do.
- [89:36]
A
It they said it was impossible when you just got two random mics in the conference room that you could have a guest on your show but you can anyway honestly congrats to everyone who got mentioned in this article i think there'll be some snarky takes i think there'll be some supportive takes overall it seems pretty high leverage to throw up a flag that says hey i'm working hard on my story startup get mentioned in the wall street journal they probably had to take what half an hour off to do a little phone call for this and overall probably pretty high leverage effort so congrats to all the all the young grinders in san francisco working eighty hour weeks good luck to you all and and congrats on your first wall street journal mentioned many hopefully and if you want to help grow your startup up get on adio customer relationship magic adio is the ai native crm that builds scales and grows your company to the next level you can get started for free did you see.
- [90:33]
B
That polymarket is getting offers at up.
- [90:37]
A
To ten billion whoa polymarket is of course a sponsor what is volume just going through the roof isn't aren't most of polymarket's metrics kind of public because you can just look at the channel chain right yeah check is that driving.
- [90:53]
B
Check that is i mean you know they they they're about to be moment they're about to be you know launching their app in the us everything to date has been international that is a.
- [91:04]
A
Big catalyst yeah so a lot going on they're they're obviously duking it out with kelsey but it's great to see shane on an absolute run and whole team put more put more put more cash in the coffers more opportunity to build and scale the business it's been a fantastic data source for us of course polymarket power is the ticker that you see on the show all three hours long every day and it's been a source of insight for us through our entire partnership so thank you to polymarket for sponsoring us rehat has a fun funny screenshot says design is not just what it and you can't really.
- [91:48]
B
See it because this this is no way this is real it has to.
- [91:50]
A
Be fake i think he's memeing some liquid glass nonsense and some poor design mixing up the design but he got six k likes potentially with the fake news i don't know if this is real there's no way they've there's no way this is real right anyway you were to figure out it's a good joke anyway in other good news kaz over at shopify now open door is replying to random posts on twitter saying email me i'm still at shopify until tomorrow here's my email and fahd says bro this guy absolute dog grinding to the last minute love this level of dedication you know open doors all over the place the stock's way up it's become this meme stock that is fascinating because i was talking to brandon about this with he was saying like there's something interesting about the open door story that is this like retail army driving a meme stock the valuation is basically i mean keith was actually steel manning it saying that as a revenue multiple it's not that crazy it's in the same territory as some other big public companies i think you cited robinhood at thirty one x revenue or something like that and so wait what company so so open door he was saying that like open door is not disconnected from the financials if you if you if we can deliver on the growth and we can deliver on a revitalization plan right that was the that that was his pitch and and so and so.
- [93:22]
B
But but he won't he wanted to fix it on the revenue multiple i.
- [93:28]
A
Think it was the revenue multiple okay you can go and look at his reply but basically i i i i don't think anyone anyone disputes the fact that open door is trading very differently than it was trading last year last year it was trading like a company that was in manager mode with a new ceo and and had gotten kind of hit in the post zerp era and had not done particularly well across a couple quarters and was i mean the stock was you know jim cramer would probably say the stocks in the dump but the stock is no longer in the dumps it's been on an absolute tear people have been making fortunes off of it and the question is you know what do they have to deliver well they clearly have to go you know they have to kick it into a completely different gear and it's just exciting to see kaz take the ceo role and be cut from very different cloth like i've interacted with kaz he's been i've actually emailed him at this email and he solved a problem for me on shopify in like two seconds he almost basically saved my business so i mean he is he's a.
- [94:33]
B
Remarkable operator yeah very aligned comp structure.
- [94:37]
A
As well totally he's really based on.
- [94:40]
B
If the market cap salaries at like.
- [94:41]
A
A dollar yeah exactly and so people will debate the valuation it's clearly trading on the back of a completely different narrative with a completely set of investors that are setting the valuation it's now valued it was it was valued very low now it's valued very richly but it's it is interesting to see some real legit folks in silicon valley step in and say hey we're going to do the turnaround thing you don't often see this most time when most times when a vc incubates or backs a company and it gets out into the public markets and they're able to distribute the shares and they're able to sell their position down down if that company does not do well over the long term they are looking for the next startup to go in and take a second run at that business right so if i'm not going to be able to think of a perfect example but i mean even just think about like like the story of square like square was keith her boy as well right he was in that it's like he wasn't saying like okay i sold paypal i need to get back into paypal to do more fintech stuff he was like no like i'm fine to do another startup and there's and there's a variety of stories where someone's someone's taken a company taking it to acquisition or taken it all the way to going public and then the vc's and some of the entrepreneurs and some of the early employees say hey we still really like this we like this industry i mean maybe the best example is is ramp and paribus like eric lyman and karim matiah took a run at at you know understanding like the financial credit you know how people spend money saving people time and money on the consumer side with paribus sold the company and we're like there's more opportunity here let's keep going and so i feel like that's the default playbook in silicon valley is that once once you've bet on an industry you've bet on a category and you've backed the right founders you've gotten your return you've returned capital to our lp's either through an ipo or an m and a process you're not saying let's go back into that same structure you're saying let's start again let's start a new company but this is an interesting twist in that is that you could imagine kaz saying hey i've been at shopify for a while i want to say start a real estate technology company yeah and so keith is going to write me a check khosla's leading the series a i got a couple people that i've worked with before no he's coming into open door he's actually turning around so it's a little bit it's a little bit different although the the gamestop story was somewhat similar because the the ceo of gamestop had founded chewy i believe and was a very successful entrepreneur and it was a similar example of like someone there was still a lot of questions about gamestop like can they turn that company around but the stock performance was obviously crazy but it was not a it was not a purely financial person stepping into the role it was an experienced ceo who built a real company like at real scale yeah anyway i don't know if you have a i don't know if you have more of a take on open door or shopify or any anything like that but i've been no.
- [98:01]
B
I'M excited to see what kaz does.
- [98:02]
A
Doing it in it'll be interesting how did you sleep last night did you get to catch up we need the soundboard because i got a ninety two.
- [98:10]
B
How did you pull that off i.
- [98:11]
A
Got a ninety two i got way closer to the airport i got to bed really early how's your how's your sleep experience i'm using an eight sleep by the way eight sleep dot com five year thirty night risk file free.
- [98:22]
B
Returns for only six hours and twenty seven minutes i'll leave a five star.
- [98:26]
A
Review for eight sleep the app i love the app it is fantastic i am you're currently potentially you're you're going.
- [98:35]
B
Into a big i'm currently ill yeah i have the hrv of a of.
- [98:40]
A
A dead person it's terrible well lock in this weekend get some sleep we will be fortunately home later this evening this was fun iphone air bend test on tom's guide icon says an apple exec casually throwing their product product across the room and not flinching at all when the host misses and it clanks off of the wooden table is insane apple is extremely confident in the dirty.
- [99:05]
B
I looked this one up i i looked this one up because i was like again it's like a parody account it looks like yeah it looks like it's fake video but it's a real real video no it's real they're confident.
- [99:16]
A
I mean do you remember bendgate do you remember this with the iphone i think it was the iphone six no they went it was the thinnest iphone ever and it got truly thin like well way thinner than this back then they went they were thin maxing so they they were width minning i don't know is that the right word they went super thin and the problem was that if you applied a little bit of pressure you could actually bend it and break it like pretty easily like you could do this and it would.
- [99:41]
B
Be now it's titanic and now it's.
- [99:43]
A
Titanium it's thicker there's more structural support inside but the question with the iphone air was obviously like hey you're back to being super thin is this thing going to bend and they just toss it across the the the conference room and the and the host tries to bend it and he's unsuccessful and i think they figured it out anyway they probably designed it in a avengers themed office did you see this article in the wall street journal's mansion section today of course i did four point four million dollars renovation helped one winnipeg couple turn their twelve thousand square foot home into it into an experience and a story the wall street journal says an avengers office in a frank sinatra garage they built their own disney disneyland i love this i love when people go crazy with the the renault and make the homes their own some disney fanatics get their fix by visiting theme parks tech entrepreneur jeff fetts and his husband chris fetts wanted to live in their own magic kingdom the setting for their dream home a twelve zero zero zero square foot traditional style home built in two thousand nine in the tuxedo area.
- [100:45]
B
We got it gotta ask g i'm gonna scare me right now what's of.
- [100:51]
A
Winnipeg and so here he is standing next to what looks like a very fancy luxury car with the biggest cartier santos on his wrist i believe he is an absolutely beast of a watch if you want a cartier santos head over to get bezel dot com your bezel concierge is available now to source you any watch on the planet seriously any lodge such a good transition they they brought the they bought the brick stucco and limestone house for around four million in twenty twenty twenty nine then they spend four point four million in a three year renovation to actually to actually upgrade the house we wanted to elevate the design to the level of fantasy chris who was a full time cast member dancer and parade performer at walt disney world resort is he just.
- [101:36]
B
Is this like extremely lucrative crazy no.
- [101:39]
A
No no no so so the so the his husband so there's chris and then there's also jeff and jeff has a startup as a business that does actually customer service and has become very successful from that he co founded a customer service tech startup now and called intouch cx after seven years they moved to winnipeg to be closer to the family family they met in nineteen ninety seven so they've been together almost what twenty years they were both students at the university of south florida and yeah they figured it out they have some crazy crazy stuff going on here let's read about the this shot of the.
- [102:25]
B
The cars in this entryway the car.
- [102:28]
A
Inside i mean this art deco stuff is wild we wanted each room to be experiential who grew up going to disneyland and would regularly go to christmas shows when they were first dating the garage mahal as the couple have dubbed it is a garage that was renovated as a shrine to frank sinatra it houses a peacock blue rolls royce silver shadow sedan that sinatra bought as a wedding present to his wife barbara which chris won in an auction the jazzy room with lacquered wood paneling oversized backlit frame photos of frank and barbara and a curved blue sofa is where chris hangs out listening only to sinatra records and drinking cocktails with friends it's way sexier than a man cave it's crazy jeff's downstairs office is nicknamed avengers headquarters and the windowless room has the feel of a spaceship to enter you touch a panel and a pocket door swooshes open like in star trek there's a long metal mission control station aka desk the walls are clad with stainless steel and covered with television monitors and avengers logos and there's room to store much of jeff's forty thousand comic books on display is a full size iron man costume it makes me feel very in touch with my childhood they call one of the bathrooms the spa and the story goes on you can read it in the journal but what a wild house you love when someone makes it big and just just just blows it all on a crazy renault i texted.
- [103:54]
B
Jeremy jeremy say studying for their dream a twelve thousand square foot traditional style home built in two thousand nine in the tuxedo area of winnipeg i said tuxedo area question mark he said enforced by law actually enforced by law do not go to the tuxedo area of winnipeg without wearing a tuxedo you will be you will be taken into custody.
- [104:18]
A
Anyway let's move back to the timeline nader khalil says friendly reminder that multiplying revenue by twelve is not arr.
- [104:27]
B
Says a lot that this goes viral in in the year twenty twenty five sure two point two over two thousand likes yeah what about harry's asking the important questions what about multiplying daily revenue by three hundred sixty five no if you've.
- [104:43]
A
Got lumpy revenue that you processed your biggest invoice and then multiply that by.
- [104:48]
B
The number of hours in a year.
- [104:50]
A
Multiply by twenty four then you have your hourly actually take it a step.
- [104:55]
B
Further to find the exact minute that you got the largest payment ever and multiply that by sixty and then by twenty four and then by three hundred sixty five and that is the way to think about minute we just had.
- [105:08]
A
Our biggest minute ever ever like like people talk about their quarterly earnings we.
- [105:15]
B
Just had our biggest minute ever put.
- [105:17]
A
Us on a twenty trillion dollar here's.
- [105:20]
B
The proof here's the stripe dashboard here's exactly what here's the exact minute the.
- [105:25]
A
Page if you want to bet on some companies that are subject to gap regulations and need to actually deliver really in quarterly reports that are sec regulated head over to public dot com investing for those that take it seriously multi asset investing industry leading yields they're trusted by millions folks public dot com also emily sundberg breaking news she has commissioned donald boat's work do you want to.
- [105:58]
B
Know this is a crossover i was.
- [106:00]
A
Not expecting do you want to know the very first sincere sensation i felt while attempting to eat this spasm my jaw cramped an inward violent shaking i cried out in pain burgers shouldn't be this tall that was instant divine comeuppance i was punished from above for even trying to place in my mouth says donald boat so i'm interested to see what donald boat does obviously he's a very creative mind very schizo he he's mastered like he's we have this you know schizo red string diagram behind us but donald bo takes it to it to a completely different level with his collages which i have i've enjoyed he's he's done some fantastic posting morning brew has a story yesterday larry ellison's fortune grew by one hundred billion dollars and today larry ellison's son his media conglomerate is getting ready to buy warner brothers normal family things these two father this father son duo is is on a generational run you'd love to see it he is running around acquiring companies becoming a media mogul pretty fun crazy i actually have not dug into what's going on with warner brothers what's going on with this discovery i know that there's like the merger and the free press is involved somehow i'm hoping we can get barry weiss on the show at some point to kind of break it all down for us because i warner.
- [107:20]
B
Bros is up up fifty three percent pretty new to the past five days.
- [107:26]
A
Yeah i do think it's interesting that at least in the at least in the dot com boom like the primary investment bank desk that would watch tech companies would also watch telecom companies and also media companies tech media telecom like if you went to goldman sachs and you wanted to analyze what we think of as like pure technology companies you would be tech media and technology and it's because they all have the same they all have very similar zero marginal cost business models yeah so if you create if you create mickey mouse or you own a telephone line or you have a website and you're selling saas those are all financially modeled somewhat similarly and so it made sense to put them all under the same coverage group of course now like there's a dedicated desk just for semiconductors and just for you know social apps and just just for saas and just for enterprise yeah.
- [108:24]
B
Anyway imagine imagine being able to run around buying companies knowing that you have the full backing of your father but you're buying company i mean warner bros is worth forty six billion there there.
- [108:38]
A
That'S a lot more than i would.
- [108:40]
B
Wow is preparing a majority cash bid meaning that like they're gonna spend at least put up at least ellison's into.
- [108:49]
A
Debt i feel like he's not afraid.
- [108:50]
B
To lever up he's not afraid maybe.
- [108:51]
A
That'Ll happen at some point but yeah put the cash together get the get the company i i don't know it'd be cool i feel like i feel like i i've never met larry ellison's son but i feel like i would trust him to make the next superman and batman film and warner brothers owns the dc universe i believe and i feel like he would have good instincts i'm also excited about the jeff bezos james bond i feel like it's going to be good i don't know i know you know nothing about movies what.
- [109:22]
B
Who who's the who's the who's going to be mister bond i have no.
- [109:27]
A
Idea but i just i i think a lot of people are the true james bond fans are are worried about this idea that that now that amazon owns the rights to james bond they're going to like franchise it like they did with star wars so it'll be like a james bond show and a james bond kids show like if you see star wars it used to just be like there's three great movies then there's three prequels and then disney was like let's do three sequels and then two extra movies and then spin off show like there's probably six or seven different shows for the man mandalorian and the boba fett and all the different spin offs and there's kids versions i think that's kind of fine yeah i think i think star wars has been kind of like yeah there's like some mediocre stuff in there but like you can just not watch it and overall there's like there's enough to pull off the shelf so like if you want to watch something with a four year old you can if you want to watch something with an eight year old you can you can get into the original the original trilogy still exists there like you can still watch it so like i don't know i've been i've been happy with that i would be happy with more james bond content let let bezos cook on on on bond.
- [110:30]
B
In my opinion the it's so funny people being like oh they're going to spend two hundred million on the free press meanwhile it's like such a rounding.
- [110:39]
A
Error when you talk about like this.
- [110:41]
B
Totality of deals that they're looking at doing they're looking at buying a fifty billion dollars he's alive majority cash and you want to turn around these assets and improve them and you need great talent and if you need if you got to spend a couple hundred million to get somebody to to you know.
- [111:03]
A
I think i i i i i think it makes a ton of sense if you're just thinking about it through like this mark zuckerberg mindset of like who do i want around the table right now i want a bunch of great people who are entrepreneurial who are you know super connected live players who really care about this stuff yeah you got to spend go time some money to get them but it's going to work out anyway apparently there's a company called math inc and will brown they.
- [111:29]
B
Really think they actually got do you think they actually got math inc i don't know maybe like because these aren't mathematics inc there's there's there's a certain flex to getting i mean you can.
- [111:43]
A
Get christian says excited to share that i'm starting a new company dedicated to the creation of verified superintelligence via auto formalization so is this a competitor to is this a competitor to vlad's thing building on the amazing rl infrastructure that we developed at morph labs mathematics inc has already achieved a breakthrough result and their hiring page says we call a date a square if all its components day month year are perfect square i was born in the last millennium and my next birthday will be the last square date in my life so there's a very hard math problem here and you just have to in order to apply for their jobs you have to solve a math problem so i don't know you want a job and you're good also i feel like this is this is an odd question because i feel like if you copy this and you and you ask it like of.
- [112:36]
B
A frontier model that's the whole i imagine that's the whole point i doubt it i do you think it can we should try if well if it.
- [112:44]
A
Would pretty i mean i i i have yet to see like a like a hard math problem out there that that hasn't been pretty easily one shot by most of the like like this type of like concise question is typically handled by a frontier model with reason listening maybe not but we'll see more importantly a video game entrepreneur has just paid thirty one point five million dollars for an oceanfront hampton's home you got hamptons up on the board connected to patek the deal marks the latest in a string of luxury transactions the busy east end market so karch this is matthew karch it's a circa nineteen seventies home in east hampton he's the co founder of sabre interactive a video game developer and publisher and i dug into them and they do a lot of porting and platforming so a game will be put out by one publisher and they'll say like we would love to get this xbox game on nintendo switch and matthew karch will pick up the phone and say my team would love to do that we will do the hard work of making sure your game works on the nintendo hardware or over here and they do a lot of other stuff but he has some great video games in the portfolio and obviously it's it's provided for a wonderful life and he is now in the position where he can buy a thirty one million dollar home he's also i believe he sold the company and the company changed hands again so it's unclear exactly who who who owns what but it's a cool story and now he has a wonderful stunning house the house literally sits on top of the ocean the property is so amazing that i wanted to buy it and figure out the details later he said so he's talking to the journal he'd love to see it if the if the journal calls you about your home you got to pick up the phone the seller an entity linked to norman and helene stark bought the estate for four point seven million dollars in nineteen ninety four the property first hit the market in twenty seventeen for seventy five million wow that's high had been off the market for years the most recent asking price was thirty nine million property contains five bedrooms roughly seven thousand square feet main house as well as a guest house twenty tennis court and pool the hamptons real estate market like those in many vacation destinations soared during the pandemic but the number of hamptons sales hit a fourteen year low in twenty twenty four amid tight inventory and rising mortgage rates and there's an interesting dynamic where renting a house in the hamptons is like a massive multiple of what it costs to buy pay the mortgage on a house because people really only want to be there in the summer they don't necessarily want to buy or live there so so there's the kind of an odd disconnect between the rental and purchase market where where you might not see that.
- [115:28]
B
In la yeah at the same time i don't i don't think it necessarily masks out to buy a hamptons house right now and just rent it in the summer totally just given given where.
- [115:38]
A
Rates are yeah makes sense in the second quarter of twenty twenty five there were twenty six home sales in the hamptons at or over ten million dollars compared with twenty two in the second quarter of twenty twenty four and six in the second quarter of twenty twenty three twenty twenty three was really slow karch also owns two properties nearby sag harbor that he uses for vacations he's considering selling one of them anyway another.
- [116:04]
B
Couple homes nearby deal there's a series.
- [116:07]
A
A financing for a new company that just came out of stealth brain company we saw math company now there's brain company brain company emerges new math today we're getting somewhere we're seeing a trend i like it brain company emerges from stealth today and we are announcing our thirty million dollars series a led by elad gill and jared kushner's affinity partners brain company provides an ai platform and applications for the world's largest and most.
- [116:31]
B
Important we were getting this company what.
- [116:34]
A
Did we yeah we we were connected i i i believe we'll hopefully have the founder on soon a lot gill's also coming on the show soon so we can talk to him about this so go check it out if you're looking to get in early go work.
- [116:47]
B
There potentially meanwhile the profound team is using out of home advertising to try to find an office in union square driving around a driving around an advertising truck a box truck trying to find.
- [117:04]
A
Their i think that they could scale this campaign they should get on i think out of home advertising made easy and measurable say goodbye to the headaches of out of home advertising only ad quick combines technology out of home expertise and data to enable efficient seamless ad buying across the globe i mean seriously they should put some of their testimonials or like case studies on like billboards and airports like that makes a ton of sense if you're just like a general business and you're interested in getting your brand mentioned on chatgpt just flashing the profound name in front of people that's pretty high value anyway did you see the knockoff bugatti i did not.
- [117:37]
B
This is but this is offensive to.
- [117:40]
A
My this is extremely offensive too bugatti is italian wait bugatti is an interesting company right because they're like it's german but then they have a they have an their manufacturing plant is like on the border and it's like changed hands a few times or something but anyway most people know the bugatti veyron shiron.
- [117:59]
B
But german and then french is a.
- [118:02]
A
Top yeah that's right it changed hands.
- [118:04]
B
But then it was acquired by an.
- [118:06]
A
Italian home cleaning robot maker and it's showcasing the photo of its first car a bugatti like luxury battery electric vehicle.
- [118:15]
B
So it's a is this dream is this a chinese company it is a.
- [118:20]
A
So traxes says a vacuum cleaner robot company founded in twenty seventeen wow they're.
- [118:26]
B
Literally a dyson knockoff they're a dyson.
- [118:28]
A
Knockoff now knocking off value to three billion dollars is making a luxury ev now apple gave up after ten years of trying burning ten billion dollars in.
- [118:37]
B
This is so offensive in my culture.
- [118:39]
A
I know it's crazy how much it looks like if we i mean it.
- [118:43]
B
Wasn'T even it even has like a rear diffuser on the back well yeah so they're knocking off like the veyron but then also the new one which.
- [118:50]
A
I'Ve tourbillon yeah the tourbillon is the latest one although are you talking about some of the one off offs because.
- [118:56]
B
There was a one off that looks.
- [118:58]
A
They'Ve done like convertibles but there there's only i i believe there's only three major platforms there's the solitaire the solitaire.
- [119:05]
B
Okay is there so they this knockoff is using the front end of the solitaire yep i mean it's closer to it just like a solitaire knockoff yeah really really dark never do this if you're if you're running dream test tech contact your lawyer and you'll be work with them to wind down the company please just shut it down close up shop you guys had a good run you're out of ideas and just just close it up how do you think.
- [119:37]
A
This sells i mean china's knocked off the taycan successfully they've knocked off a few other cars successfully i wonder what.
- [119:44]
B
The yeah i do think the the humor here year is that they will probably make a pretty solid car and it will cost like they can start selling bugattis for a couple hundred thousand.
- [119:57]
A
Dollars probably yes can you imagine no.
- [120:00]
B
But like you could imagine they sell this for like it's probably a couple.
- [120:02]
A
Hundred grand one hundred fifty or something.
- [120:04]
B
Which is why and then if these i could see this making it into america where somebody's like wait i can.
- [120:10]
A
Drive make it to america this will get caught at the ports for sure.
- [120:13]
B
You mean you mean like yeah ip.
- [120:15]
A
Trade dress like it'll be easy to lock this up it's not making it to america but people will be driving around in china i mean i've i've heard about fully fully counterfeit cars before like in china they would they have the ability to set up like it's a g wagon factory and it makes cars that look like g wagons and that are bad and badged everything is trying to be as perfect as possible a true knockoff and and then they work their way through other countries you take it in the dealer and they're like we can't work on this engine this is not a mercedes engine well.
- [120:48]
B
Yeah and and the reason that knockoff cars are not as big as knockoff watches is like there's no regulatory framework for watches right you're not going to hurt someone else by driving wearing a fake rolex or whatever this was big this was big two of the clulee founding team have broken off pretty crazy yes they are doing running the same.
- [121:13]
A
Playbook yep gris says life update left cluley to start our own thing already at one point two million arr seven days in stealth had no idea making money was this easy announcement soon instinct inc this post is bad fascinating fascinating because doesn't say what the business is one point two million arr what is the subscriptions of some sort it's written.
- [121:43]
B
To and then it's written to trigger.
- [121:46]
A
Yeah had no idea money was this easy yes you did have an idea.
- [121:50]
B
That making money because you were saying.
- [121:51]
A
That clearly you said making money was easy i know how easy money is but here we are talking about about it anyway good luck to them debated.
- [121:59]
B
Us debated us no but yeah wishing them wishing them luck and i wonder if they will start beefing with their former employer to from yeah from a.
- [122:10]
A
Wwe perspective that is going to be unmissable content if they are constantly chirping at each other and fighting and going on podcasts and debating each other and and taking shots and running adversarial billboard ads against each other like there is a world where that generates more views than anything they've done before that might be the final state of of startup media and marketing the real question is like what is what what does this say something about like whether or not cluli has hit product market fit we demoed the product we we were not very sticky tyler it seemed like he enjoyed the product and thought there were some glimmers of hope but he did not become a daily user audience well when we talked to roy it was it was wasn't clear who the date who the target audience was it was maybe the college kid who wanted to cheat on an exam or you want to cheat on an interview but then that was probably illegal and risky so you don't want to do that then there was like maybe enterprise sales then roy was talking about brain computer interfaces and vr and so like there were just like a bunch of different ideas clearly throwing spaghetti against the wall unclear what was stick ticking and so i'm i'm interested i am interested to see what instinct inc winds up building and i'm wondering if they have done more work to make sure that they're building on top of a solid foundation because the big question that was looming around clearly was just masterful marketing lots of clearly breaking through the noise cutting through the noise getting downloads but but was it a leaky bucket and so has this team now that they're on their own have they built a less leaky bucket with this because what happens if you stop going viral does that one point two million dollars in arr turn into nothing over fourteen days because everyone.
- [124:04]
B
Unsubscribes who knows anyway i would go out and guess that they're just starting a creative agency which would probably make a lot of money really fast i.
- [124:16]
A
Think so so that would make a lot of sense anyway find your happy.
- [124:21]
B
Find your happy place book a wanderer.
- [124:22]
A
With inspired views hotel grade amenities dreaming beds top tier cleaning and twenty four seven concierge service it's a vacation home but better folks we will close out with this twenty five years ago there was an article in the newspaper in the daily mail tuesday december fifth fifth two thousand internet quote may just be a passing fad as millions give up on it and of course recontextualized max the vc is obviously drawing a comparison to the ai narrative i don't know if anyone's gone out and actually said ai is a passing fad people have kind of said like maybe we're over our skis on capex or maybe we're over our skis on on on you know enterprise value or maybe the promises are too grand yeah maybe we're not getting asi tomorrow yeah twenty twenty seven but i i don't think anyone is out there really saying yeah in ten years like we're not going to be.
- [125:22]
B
Chatting with ll so funny to try to i mean it's it's very difficult to to like this article is especially funny because internet may just be a passing fad as millions give up on it it's like well are those millions of people benefiting from other people using the internet if so then like it's this is has enduring value crazy researchers.
- [125:45]
A
Found that millions were turning their back on the world wide web frustrated by its limitations and unwilling to pay high access charges they say that email far from replacing other forms of communication is adding to an overload of information experts from the virtual society project which published the result the report say predictions that the internet would revolutionize the way society works have proved wildly inaccurate many teenagers are using the internet less now than previously they conclude james chapman i would love to know where james chapman is now he was a science corps correspondent at the daily mail and it's interesting i mean he it's you can't really say like he got this wrong because he's just publishing the facts which is like these researchers found this data point and kind of leaving it up to your interpretation but.
- [126:42]
B
Less yeah and that's like all these articles come out like ai adoption in the enterprise is dropping yeah or or what what was the the mit report like ninety five percent of gen ai pilots are i mean.
- [126:54]
A
That that that meter report was like the most bearish take on cursor possible because it was like cursor is slowing people down that was like the the.
- [127:04]
B
And yet the basic yet and yet demand but you dug into it and.
- [127:08]
A
There was a lot of different ways that it could actually speed you up in certain in certain contexts in certain.
- [127:13]
B
Well yeah and then all the products just getting better look at the demand for exactly yeah incredible the apparently cursor in the secondary market is trading closer to thirty billion than twenty that's up.
- [127:29]
A
There man that's up there it's great.
- [127:32]
B
Though incredible time to be alive incredible.
- [127:35]
A
Time to be alive well thank you for tuning in to our remote live stream today we will see you we.
- [127:41]
B
Did it they said it was impossible prove them wrong and next week got some travel in the in the middle of the week but we will be back in the ultra dome monday and tuesday very excited and get out there this weekend and touch grass be with your loved ones log off i'm excited to log off i think charlie would was known for logging off from friday night to saturday and we'll be doing my best to do the same and.
- [128:20]
A
Thank you so much for tuning in.
- [128:21]
B
Thanks for tuning in this week we'll.
- [128:22]
A
See you monday goodbye love you.