Swatch AP Collab, Cerebras IPO, Trump Visits China | Ferdinand Dabitz, Spencer Rascoff, Eric Olson, Matt Lohstroh, Jay Azhang, Amir Sadeghian, Alexander Taubman, Quaid Walker

Summary

TBPN Podcast Summary

Episode: Swatch x AP Collab, Cerebras IPO, Trump Visits China
Hosts: John Coogan & Jordi Hays
Air Date: May 11, 2026
Featured Guests: Ferdinand Dabitz (Augustus National Bank), Spencer Rascoff (Match Group), Eric Olson (Consensus), Matt Lohstroh (Giga Energy), Jay Azhang (n of 1), Amir Sadeghian (Astrocade), Alexander Taubman (Longlake Management), Quaid Walker (Bezel), others
Main Theme:
A deep dive into the intersection of technology, finance, and culture as the hosts and a parade of high-profile guests break down recent headlines including a game-changing Swatch/AP watch collaboration, the Cerebras IPO's wild demand, big tech and political moves in China, the evolution of dating, and the rise of AI-powered business models.

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Episode Overview

This packed live tech episode features rapid-fire coverage of:

• The hotly anticipated Swatch x Audemars Piguet (AP) collaboration and its impact on the watch world
• Cerebras's explosive IPO—and what it reveals about the AI hardware frenzy
• Trump and top Western CEOs (Tim Cook, Larry Fink, Elon Musk) traveling to China amid Middle East conflict
• LA vs. SF in the post-AI tech boom era
• New models in dating apps, finance, scientific research, data center infrastructure, and more
  Guests weigh in from all angles, joined by spicy in-chat commentary and live fact-checking.

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Key Highlights & Segments

1. Swatch x AP Collaboration & Watch Market Shake-up

[00:11–12:30, 145:26–157:47]

• Background: Swatch is partnering with Audemars Piguet (AP) to launch what many call a “knockoff” Royal Oak—but officially sanctioned and aiming for mass appeal (cf. prior MoonSwatch collab with Omega).
• Why Now? Fakes are flooding the market and the gap between entry AP models ($30k+) and aspirational buyers is immense.
• Brand Strategy:
  • AP has "consistently done provocative things" with celebrity partnerships and now via a mass-market collab—challenging the idea of exclusivity ([Jordi, 03:55]).
  • The collab leverages Swatch’s industrial scale, possibly including the 3D-printed System 51 movement.
• Market Impact:
  • Anticipated retail around $400, resell up to 12x, in-store only—spawning advice on how to flip for profit (“easiest four-figure week you’ll have all year” [11:37, John paraphrasing Social]).
  • “I think this is gonna be a hit. The haters are wrong. People love G-Shocks”—[Jordi, 12:03].
  • Some argue this is brand suicide (“AP just killed its brand”), but others point to increased Google searches and surviving past provocations ([Reddit/Google spike, 07:31–07:50]).
• Legal/Strategic Angle:
  • AP lost key global trademark fights, forcing strategy to flood legit “Royal Pop” pieces in the wake of unstoppable fakes ([09:24–10:20]).
• Guest Perspective (Quaid Walker, Bezel):
  • System 51 signifies a 3D-printed, fully replaceable mechanical movement.
  • “It’s an interesting entry point… it allows people to aspirationally engage” ([Quaid, 150:53]).
  • Strategic for AP to counter fakes and finally offer an “entry” product—without cannibalizing the high-end.
  • No “AP Swatch effect” on secondary pricing—yet—with discontinued Royal Oaks holding steady.
• Fun quotes:
  • “The dollar is the best product in the history of the world. Insane PMF.” – Ferdinand Dabitz, 37:41
  • “If you want to get in, you’re at 30k, and there’s not as much walk–crawl–run.” – John, 05:06

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2. Cerebras IPO Mania: The New AI Hardware Boom

[17:44–24:19]

• IPO Details:
  • Cerebras (AI chipmaker) upsized IPO, increased price range 115–125 to 150–160, offers 30M shares; demand reportedly 20x oversubscribed.
  • “Being a chip company in May 2026 is hard to beat!” – Jordi, 18:19
• Business Case:
  • AI inference costs, and specifically new “wafer-scale” Cerebras chips (900k AI cores, massive on-chip bandwidth), are fueling insatiable demand.
• Customer Traction:
  • No longer all OpenAI; Amazon and others on board.
  • Easy demo: instant GPT-5.3-level queries (history, code, etc.) with real-time feedback—a compelling sales pitch.
• Market Expectation:
  • Polymarket projects $50B+ market cap close on day one, far above prior $26B.
• VC Angle:
  • Benchmark’s early 2016 investment could create “number one fund in VC history.”
• Hot Take:
  • “The boom is real. Grok fact-checked it: ‘Mostly accurate!’” – John riffing on David Sacks’s napkin math for data center economics ([125:50–126:54])

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3. Trump, Xi, and the CEO “Field Trip” to China

[25:10–29:40]

• Context:
  • Trump visits Beijing for peace talks with Xi amid a US-Israel–Iran war and Strait of Hormuz closure.
  • Monster CEO delegation: Tim Cook, Larry Fink, Elon Musk, Jane Fraser (Citi), Chuck Robbins (Cisco), David Solomon (Goldman Sachs), Steve Schwarzman—and “calling it a field trip” ([25:10–25:20]).
• Agenda:
  • Peace/energy deals (oil, trade, rare earths, GPUs), but major focus is Iran.
  • AI regulation on the table—China wants access to US AI/weights ("why not just send the weights? We'll inspect it..." [28:52, John & Jordi joking]).
• Tech Industry Stakes:
  • US tech hopes for quick conflict resolution, less focus on AI “safety” restrictions.
  • Intrigue about high-level negotiations and who’s truly influencing policy ([29:17, Tyler: “These people are not going to be arguing in favor of, like, safety”]).

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4. AI Agents Revolutionizing Service Sectors

a. Finance: Augustus National Bank

[36:48–41:41]

• News: Conditional OCC approval for a full-service US national clearing bank, built for the AI era.
• Vision: Combatting the “broken” distribution layer—replacing slow human-run clearing with AI-enhanced systems.
• Mission: Advance Western currency dominance as rivals (China, Russia) push their own digital currencies.

b. Science/Academic Research: Consensus

[66:04–73:25]

• News: $30M Series B; expanding from search to a full workspace for researchers.
• Insight: Focus on augmenting, not supplanting, the human scientist—“collaboration and inquiry are still the essence of science” ([Eric, 68:24]).
• Institutional Go-to-Market: From individual labs to licenses with 100+ universities.

c. Dating: Match Group (Spencer Rascoff)

[41:49–65:49]

• Org Transformation:
  • “Match Group was basically a holding company—now we’re an operating company” ([44:55–46:57]).
  • Broke silos, unified backends, focused on innovation (Tinder, BLK, Chispa, etc.).
• Product Innovations:
  • “Double Date” (25% of Gen Z on Tinder now use it), IRL events, and AI-powered profile/recos/deepfake detection.
• Growth & Competition:
  • Endless new startups (“hotdog” nightclub effect, network moats); acquisitions (Her, Sniffies).
• AI Impact:
  • Pull requests (code output) up 60% YoY, but CEO/CFOs asking: are we seeing true business impact yet?
  • Example of “AI sprint” in launching IRL events in 2 months (vs. prior 6–12 months).
• Concerns:
  • Gen Z inertia/loneliness—the real competition? "Our biggest competitor… is inertia" ([60:23, Spencer Rascoff]).
  • “Wedding category”/housing questions, and AI for real estate.

d. Trading Agents: n of 1 (Jay)

[88:22–96:11]

• Pitch: Next frontier—everyone will have a personal “trading agent,” as coding agents become the coding default.
• Model: Natural language to deployed strategy, consumer-facing, integrates with all brokerages.
• Differentiation:
  • "We're building models that generalize, not just maximize short-term profits" ([90:18, Jay]).
  • $15M new funding announced.

e. Games: Astrocade (Amir)

[105:44–123:25]

• Product: Make and share AI-generated playable games—“like Instagram, but for games instead of photos” ([107:08, Jordi]).
• Stats: 5M MAU, 75K+ user-made games, trillions of tokens processed, all free.
• Business Model: Monetization to come—ads, microtransactions, creator payouts, with YouTube as inspiration.
• Tech Challenges: Building recsys for interactive content, flow state mechanics (“window washing game went viral” [109:48–110:08]).
• Quote: “The cost of intelligence is coming down but the cost of these tokens is not—because you always want to go with the best.” ([121:54, Amir])

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5. Giga Energy: Born-in-the-AI Era Infrastructure

[73:56–87:56]

• Origin Story: Started at Texas A&M—flared gas → Bitcoin mining → modular data centers → full-stack power/AI infrastructure.
• Growth: From Home Depot builds to $350M revenue, 200+ employees, almost no VC ($3.4M raised).
• Business Evolution:
  • “Selling picks and shovels” to Bitcoin miners, then to AI data centers—now builds to the rack level (powering, not supplying chips).
  • Unique Model:
    • “Our mantra is building in the factory, not in the field” ([85:31, Matt]).
    • 95% reduction in onsite labor via modular prefabrication.
• Challenges: Local resistance (noise/water), regulatory uncertainty, rapid construction, and questions of expanding “up the stack” to more of the compute layer.

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6. Other Notable Moments

• China’s BYD Denza x Daniel Craig Ad: Marketing a luxury EV using James Bond’s cultural capital ([12:32–16:07])
• “Chandelier” Service: New SF hustle—charging commission for showing up to open houses in OpenAI/Anthropic swag to pump home prices ([33:33–33:39])
• Ultra-Lux LA Grocery Wars: Laurel Supply launches as “Erewhon… but even more expensive” ([96:23–105:28]).
  • “Valet for groceries is a bug, not a feature”—[Jordi, 102:07]
• Data Center Hype & Stock Market Chart Crimes:
  • David Sacks’s napkin math: $50B capex, 2-year payback!
  • Ongoing debate: is this .com boom 2.0? ([125:28–145:11])
• Final fun riff: “The market will go up or down—50% chance!” ([158:53])

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Notable Quotes with Timestamps

• “The dollar is the best product in the history of the world. Insane PMF.”
  — Ferdinand Dabitz, 37:41

• “It starts with people, motivation, and organization… then product… then marketing… then revenue… then profit.”
  — Spencer Rascoff on his transformation playbook for Match, 44:17

• “Every unemployed guy with a group chat… Royal Pop drops Saturday May 16th… easiest four-figure week you’ll have all year.”
  — John paraphrasing Royal Pop scalper advice, 11:37

• “Our mantra is building in the factory not in the field.”
  — Matt Lohstroh, 85:31

• “Trading agents are about to go through the same adoption curve as coding agents… trading without them will feel like coding without a coding agent.”
  — Jay Azhang, 92:07

• “The cost of intelligence is coming down, but the cost of these tokens is not.”
  — Amir Sadeghian (Astrocade), 121:54

• “I think the haters are wrong. People love G-Shocks. Sort of a combination.”
  — Jordi on Swatch x AP, 12:03

• “Our biggest competitor at Match Group is just inertia… just people’s loneliness and doom scrolling on TikTok or Instagram.”
  — Spencer Rascoff, 60:23

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Segment Timestamps

• Swatch x AP/Watch Deep-dive: [00:11–12:30, 145:26–157:47]
• Cerebras IPO: [17:44–24:19]
• Trump/China/CEO field trip: [25:10–29:40]
• Augustus National Bank: [36:48–41:41]
• Match Group/Spencer Rascoff: [41:49–65:49]
• Consensus Research: [66:04–73:25]
• Giga Energy: [73:56–87:56]
• n of 1 (Trading): [88:22–96:11]
• Astrocade (Gaming): [105:44–123:25]
• Laurel Supply/Erewhon Wars: [96:23–105:28]
• Macro/data center/stock chart: [125:28–145:11]

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Bottom Line

• Watches, chips, dating, banking, energy, and games: All are being turned upside down by scale, AI, cultural remixing, and shifting global alliances.
• Trend: Incumbents across sectors are being challenged to open up, partner, go mass, or reinvent themselves before change is forced by new entrants, legal defeats, or market logistics.
• Quote: “Everyone agrees—AI GDP must be delivered!”
  – John/Show mantra

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This episode captures the restless, ambitious, meme-soaked spirit of the mid-2020s tech scene, blending Big Tech, consumer, and real economy commentary with irreverent humor and live guest insight. If you want to track where tech, money, and culture are colliding—this is the roadmap.

Transcript

[Jordi]

You are the TVPN.

[John]

Today is Monday, May 11, 2026. We are live from the TVPN ultradome. The temple technology, the Fortress finance, the capital of capital.

[Jay]

Another one.

[John]

We got a banger show for you today, folks. We got a lot of guests coming on. We got two hours of back to back interviews with everyone from Spencer Raskoff, the CEO of Match Group, to Alex Tubman of Longlink Management. Quaid's coming on from Bezzle. He's going to take us deeper on our first story, which is of course Ademar Piguet is partnering with Swatch to launch a watch that's, you could call it a knockoff of the Royal Oak. It's certainly. It's not a knockoff because it's official. It's from the actual.

[Jordi]

They knock themselves off.

[John]

They knock themselves off. And there's a bunch of interesting business business implications of why they did this, what it means, what will happen. Let's pull up the video of the launch first. And you gotta tell me, do you think this is AI or CGI? Because it's a launch video and in 2026 it's hard to tell the difference. So we're going to play the. This is from the official Swatch account. This is something that looked like a fake clickbait video, but it's real. Here it is. What do you think? AI or cgi?

[Jordi]

Cgi, Precision handmade cgi. Just like watches.

[John]

Not a Transformer in sight the way my grandfather used to. Like there will be interesting pushbacks. I'm like, oh this, this movie is awesome. It only use cgi, no AI involved whatsoever. Anyway, so wait, so is it a manual watch?

[Jordi]

Is it a. I think it's unclear. Right. So what, what there's been a massive amount of, of everyone has basically created somewhat realistic looking posters for these.

[John]

Oh really?

[Jordi]

The actual watch has not been revealed at all and that's the only thing that's been revealed.

[John]

And that's just based off of the fact that Swatch did a collaboration with a luxury watch brand, the Moon Swatch, which was based on the Moonwatch. Right?

[Jordi]

Oh yeah, I forgot about. Yeah.

[John]

And so the Moon Swatch was successful and was a more accessible entry point to the Moonwatch, which is from Omega, which is sort of in that like Rolex tier. And I don't know if the Moon Swatch how they saved cost because there's a certain amount of cost that just goes into making a movement, a mechanical movement. It's a lot of small pieces. Sure. You can put it on a manufacturing line and press them and stuff.

[Jordi]

John learning that couple hundred bucks. Watches have egregious profit.

[John]

I know they have egregious profit margins, but still like, like the, the, the work to put together all the gears and manufacturing it. Like I would be surprised if, if it's a mechanical watch, is it really going to be like $5? No, it's not a Happy Meal toy.

[Jordi]

So there's, there's the fake Chinese version of all of these popular watches, Nautilus, APS, etc. You can get them like you could go on Alibaba, get them for in the low hundreds of dollars. Right. And so it is totally possible to put together a watch totally that has a lot of the same componentry.

[John]

I saw Nico Leonard on, who's a great YouTube watch reviewer, fun, very fun creator on the Ice Hour with Graham Stephan. And they gave him. This is a fun little game that they, they're getting really good at playing games with their guests on this podcast. So they give him six watches and they tell him that three of them are knockoffs and three of them are, are authentic. And he has to guess and he nails it. He gets all of them cracked. Even though some of them were very convincing fakes, especially of Patek.

[Jordi]

So a lot of people are saying this is bear over. It's over. They're saying every freak out about $500.

[John]

Rest in peace.

[Jordi]

AP has, you know, consistently done things over the last few years to that were provocative. Right. Some of the various partnerships they've had with talent. Right. Celebrities, etc. Have been somewhat provocative. But overall the brand seems healthy. Right. It's not going to be for everyone. I think in some ways this decision could be seen. And again, I'm no watch expert, but fakes are flooding the market globally. And why not? Why not just lean into that basically? And the other thing is they don't have any entry level like the gap between, you know what, I'm sure this, this, this swatch AP will end up retailing for far more or sorry, not retail, but secondary will be far more than whatever it goes out at. But the gap even then between that and a real Royal Oak will be immense.

[John]

And the gap has been growing because the aftermarket prices have been increasing and

[Jordi]

they went incomes, they basically were like, oh, this is what our watches are worth aftermarket, we should price there. Right?

[John]

And so you quickly wound up with like to get in the game, you're at 30k and that's just a lot. And there's not as much of a walk crawl Run to get into the ecosystem that some brands have. AP certainly has not had that. And now this is.

[Jordi]

You go with a code.

[John]

Aren't those like 60, though?

[Jordi]

Oh, they are.

[John]

I think they're really expensive. No, I think they're really pricey. I don't know. But yeah, maybe they'll bring down the price on that. But live. Live Monitor, I guess Live Monitor says spend half a million dollars or $500 and you get something that looks pretty similar. Of course, very different materials.

[Jordi]

Get a code 1159 for low to mid 20s.

[John]

20s. Okay. But there's another watch collab that I want your reaction to. You gotta see this. This one's gonna fly off the shelves, potentially selling more units than the Swatch AP collab. It's the Rolex collab. We can pull this up.

[Spencer Rascoff]

Something you've never seen before and you won't see again. A Chrome hearts Rolex Daytona 18 karat gold.

[Matt]

Starting offer, 370,000.

[Spencer Rascoff]

Okay.

[John]

If you want it, there's only one way to get it. I've never seen this watch before. Neither have you.

[Spencer Rascoff]

That's why I'm showing it to you.

[John]

Do you think this is real or just something someone made randomly?

[Spencer Rascoff]

Official Rolex over here telling me that the dial might be aftermarket.

[Matt]

I don't know.

[Amir]

You figured.

[Jordi]

I don't know. I don't. I don't follow it. It's funny. Somebody on X over the weekend was assuming that I was into chrome hearts because I joked a lot about chrome hearts, but no, I'm not enough of an expert to.

[John]

That's Dylan. Dennis is playing off of your joke, saying, I tried to buy the Swatch AP Royal Pop collab, but they told me I had to buy this collab first. And it's the code 1159. If you're not familiar with the code 1159, great post. Newest watch from AP, but it has a less distinct silhouette than the royal oak and has been not loved by the biggest fans of AP broadly. And so it has been underselling, probably relative to the new Rolex. Which one's the new Rolex? The Land Dweller, which has been, I think, selling very well. And this one has been. The code 1159 has not been doing as well.

[Jordi]

Let's head over to Reddit.

[John]

AP just killed. Its brand is spiking on Google, but there was some debate over whether or not this has driven.

[Jordi]

This person is obviously disagreeing with that line by saying, like, interest is right.

[John]

Oh, oh, interest in the quote. AP just killed. It's.

[Alex]

Yeah.

[John]

My view is, oh, because the brand is attention.

[Jordi]

Like, I don't know how many of these they'll sell. I'm assuming they'll sell out. And that's going to be hundreds of thousands, probably, maybe, you know, tens of thousands at least of people that either already own an AP or they want to someday. And this is. They'll wear it every day and work, I'm sure, want to work towards getting the real thing. Let's head over to Reddit and check out what they're doing there.

[John]

What are they doing there?

[Jordi]

They have. Somebody has figured figured this out ages ago. I want your reaction, John. Omega on one side, but the Omega is strapped to the wrist with a whoop band.

[John]

Yeah, Whoop on the inside, Omega on the outside. It just doesn't feel right. It feels a little unnatural to me. I don't know. But I have seen a lot of people wearing the whoop bands lately, and I think that there's some remarkable data. I was talking to someone who connected their whoop data and found out that they had sleep apnea by analyzing it with an LLM, which is something you would expect whoop to be doing on their side. But for regulatory reasons, it might be slower for Whoop to roll out that feature of health monitoring. And so there's a lot of DIY science that comes from it. So I don't know. It's weird no matter what, because if you have a whoop on one end and then on one hand and then a watch on the other, that's an odd choice. I feel like. Isn't there an opportunity to put the whoop band somewhere more discreet? Like, even. Like a chest monitor would be less.

[Jordi]

I think you can.

[John]

The aura ring is not very intrusive, but they should really make the. What do they call it? The Boston Fitbit? It's the ankle monitor or something like that. I can say that because I'm Irish. But there was some debate over AP's motivations. Ariel Grifner says, as an IP nerd, I love this. AP's trademark loss means they lost the moat around their octagonal bezel and their dial. So what do they do? They license its crown jewels to Swatch for a flood of legit, affordable royal pop pieces. A master class in damage control. And so this is on this news that AP lost a trademark fight in Japan in 2024 and in the US in 2025. The courts ruled that the bezel and the dial aren't distinctive enough to legally own. But there's some pushback in the Community notes.

[Jordi]

Here's the thing. They have managed to, I think, maintain a trademark around the the octagon.

[John]

Yeah, well, there's a trade dress, so you can never do a full knockoff of a direct product. But they couldn't lock down the idea of an octagon. That was simply too much. So I don't know how much of this was damage control around the intellectual property, but it's certainly an interesting thing. And there's also some people thinking that this is a way to make money. You see this gem changer said every unemployed guy with a group chat of equally unemployed friends. This post is for you. The the Royal pop drops Saturday, May 16th. They're coming out with this quickly. Just one week teaser and then it's out. He says this is the easiest four figure week you'll have all year. If you're willing to do something that resembles work. Resembles work for 14 hours if you're willing. Let me lay out exactly what to do. Retail is in the $400 range. It's in store only. There's no online sales. They're limiting it to one piece per person, per store, per day, not two. So your hustle is per warm, not per pair. And then he shares some expectation about where this might trade. Maybe 12x retail, maybe 5x retail. And so if you go and you wait in line and you buy this and then you sell it online, you might be able to make a pretty penny pretty quickly, but you'll need a bunch of friends. And he gives a bunch of advice on where you should go. Avoid Soho, Times Square, London, Singapore. You gotta go to secondary cities. Troy, Michigan, King of Prussia, Canoga Park, Honolulu. Going to Honolulu just for this.

[Jordi]

I think this is, I think this is gonna be a hit. Yeah, the haters. I think the haters are wrong. People love G shocks. Sort of a combination.

[John]

I think so too. It just seems like a fun, a fun watch. And I, and I do think it's a nice entry point for someone who's getting into watches. Like, start with this, then get something else. It's like a striver. Like, you know, it's a point along a curve which I think will be popular. And it's also just like a lot of fun and it'll look good anyway.

[Jordi]

Let's head over to China.

[John]

What are they doing over in China?

[Jordi]

Byd. BYD got Daniel Craig as the new face.

[John]

Build your dreams. They're building their dreams for the Denza luxury ev. James Wood says it's an amazing ad. And Adam Thomas says China uses James Bond for a Euro push. The world is changing. Let's play this advertisement from byd.

[Jordi]

He must have had an exclusive. Did he ever have an exclusive with Aston, or was that just the James Bond franchise?

[John]

Yeah, I don't think I've ever seen him in an Aston Martin ad. But let's see this. To live in life, in a world with the capacity to find change.

[Alex]

But just as spring follows a harsh

[John]

winter and summer looks back on a routine spring. Old selves, past identities.

[Jordi]

They ship.

[John]

They have to. It's so exciting.

[Jordi]

Do you think?

[John]

I mean, doesn't life ask us to

[Spencer Rascoff]

step out of the shadows and embrace the new?

[John]

To evolve?

[Jordi]

Are there car seats for dogs?

[John]

I don't think so. I think it gets pretty dangerous. Although that dog looks like it's wearing some sort of harness that could be tied in.

[Jordi]

What do you think?

[John]

Yeah. See, post James Bond, he has a lot more comedic timing. He's done SNL a few times, he's done a couple comedies. There's a lot more to it. But he will still just never not be James Bond because he had such a successful run of James Bond performances. He's really driving this car. Is this. You can hear.

[Jordi]

Rewind 10 seconds.

[John]

Okay, what are we listening for?

[Jordi]

Listen. Because there's some.

[John]

Okay.

[Jordi]

Doesn't that sound like a internal combustion engine? For a second there?

[John]

Yeah.

[Jordi]

So they're LARPing.

[John]

It's played through the speakers while you're driving. Is that an option?

[Jordi]

Maybe?

[John]

I feel like it has to be an option if they're advertising it like that. Yeah, but who knows? You never know with these. With these BYDs, if there's actually an internal combustion engine in there somewhere that can activate at a certain point. Like, everything feels like a hybrid these days. But, I mean, it says luxury EVs. I like the design of that car. I think that's cool. It looks kind of like a wagon. It's got like a. It's a shooting brake design.

[Jordi]

I love a shooting brake.

[John]

It looks nice. But, yeah. What a great partnership and what a great run from Daniel Craig to be able to just, like, cash in on the aura of being James Bond forever, even after the franchise ends. And he has ubi. It really is remarkable if you're Daniel Craig. If you're Daniel Craig. And it also helped that. Did you ever see Layer Cake? No. No one's seen Layer Cake here. Oh, such a good movie. And he plays like sort of a someone involved in, like, the drug trade in Europe. But it's a very James Bond esque character. And so even throughout his portfolio of movies, when he's. And then he plays Benoit Blanc from Knives out, and even that character, even though it has a different, even though he has a different accent, it still feels like he carries the authority of a James Bond like figure. And so he's always had this sort of demeanor and aura around him that's been built through his entire cinematic portfolio that he can continue to cash in on. And when you're thinking about advertising a particular car, like an Aston Martin, like this luxury byd, your mind goes to him before anyone else. Really? Anyone else.

[Jordi]

Do we know what the BYD Zenza is priced at?

[John]

I don't. Probably like, I would guess like the equivalent of like $13,000. And it probably goes zero to 60 in probably one and a half seconds and has like a 700 mile range.

[Tyler]

I think European price tag is 1:34.

[John]

Ooh, okay. They're actually getting pricey. Usually when you see these BYD numbers, it's always like it's the performance of a Ferrari for the price of a Camry.

[Jordi]

Well, so there's the Denza Z, which the estimated price is 60 to 140. And then a lot of the other Denzas are in the 40-60k range.

[John]

Okay, okay. Not too bad, not too bad. Well, you know where I'd like to see Daniel Craig do his next endorsement? Cerebrus. I would love to see a Super bowl ad where he's lamenting the slow speed of AI inference. And he solves his problem in this super bowl ad by partnering with Cerebras, firing up some Cerebras chips. The IPO is looking like it's going very, very well. So Cerebras updated their filing. According to Reuters, the IPO date will be Thursday, May 14th. I heard maybe Wednesday, but any day now. And they're offering 30 million shares. That's up from 28 million. So they're offering more shares than they were expecting to. And they also increased their price range from 115 to 125 up to 150, 160. And so they're going to raise, instead of three and a half billion, they'll be raising 4.8 billion. And allegedly the round is massively oversubscribed to the tune of 20x demand for that 5 billion. So something like 100 billion of demand for that 5 billion, which is remarkable at that price. Now, does that mean it's going to 10x on day one? No, but it's certainly a good sign going into, into this ipo. And so that's why I called it like a potential $50 billion IPO, just to sort of have some parallelism with the $500 watch and the 50 trillion of GDP meeting in China that we'll talk about later. So there was a bunch of FUD

[Jordi]

this morning says if you were looking for the ideal time to IPO being a chip company in May 2026 is hard to beat.

[John]

It really is. It really is. He had a great piece called the Inference Shift today in Stratacheri. Go check it out. There's been a bunch of FUD about Cerebras. I mean, for a long time they were just sort of like building in stealth or talking about the idea. It takes a really long time to design these chips, tape them out and then actually produce them. And then the first version is less flexible, less designed collaboratively with the companies that are using them. So there was like one customer that was buying them and there was a lot of customer concentration. Now the chips have actually been deployed and there was this big narrative about like, okay, well they're maybe overly optimizing for the transformer architecture. What happens if the AI researchers come out with like, attention is all. You actually don't need that much attention is nice and useful. But we have a new thing that's better and that didn't happen. And so attention and transformer based architectures are still dominant and inference costs are extremely important in the age of AI agents. And speed is so, so important. And so demand is, you know, 10xing every few months at this point. And there's a very, very clear business story. Tyler, you have anything else to reverse?

[Tyler]

Yeah, I mean, just like if you use the three risk chips, like you can use it GPT 5.3 Spark in Codex. Yeah, it's like insane.

[John]

It's crazy. It's crazy.

[Tyler]

It's wild.

[John]

Yeah. If you want to give it a try and actually demo it, which I think is important with these, like, with these, these, these like semiconductor companies. If they're like abstract and you're like, I don't know if it's like a real company or something, like you can actually just go download Codex desktop, pick from the, from the dropdown 5.3 spark. And then you can, you don't even have to get it to do code. You can ask it history of the Roman Empire and it will just instantly tell you a full page of exactly the response with 5.3 level intelligence, which is pretty good and it's a pretty remarkable experience. And you can imagine this coming to every LLM interface. Every AI experience which has normally been like for any meaningful work, fire it off, come back five minutes later, sometimes two hours later, we'll cut all of that in half or by 10. And that's where this is going. So you can see significant demand. Even though there's this customer concentration thing. I don't know why there wouldn't be a lot of different customers lining up every lab that has exploding demand Cursor, Anthropic, Meta and Google. Unless they have a direct answer to this, I would see them being a buyer in the near term. The Cerebus upsized its IPO and top of the new range. Reuters says the IPO drew orders for more than 20x the shares available. Cerebras makes AI inference chips and lists Amazon and OpenAI among customers. So there was a question about was it all OpenAI and I guess Amazon has jumped on very flexible with regard to the chips that they rack over at AWS. What else is going on here? Polymarket is projecting cerebras to close above 50 billion market cap by the end of day one. That would be about 100% above the target valuation of 26 billion that was previously reported. So preparing for an IPO on the NASDAQ next week. Under the ticker CBRS and traditional semiconductor manufacturing works like this. A silicon wafer is fabricated. The wafers cut into hundreds of smaller chips. The chips are packaged individually and connected together in systems. Cerebras took a completely different approach. They use the entire 300 millimeter wafer, 4 trillion transistors, 900,000 AI oriented compute cores. And the big thing is the petabits per second of internal bandwidth. So better memory bandwidth for KV caches and everything that you need to do in AI. I think something like that benchmark is going to be absolutely cleaning up. They still own over 20% of cerebras apparently.

[Jordi]

And when did they make that investment?

[John]

Eric Vishra made it and he I'm looking it up. He has quite the portfolio in his X account. Bio fireworks, Benchling, Contentful, cerebral.

[Jordi]

So they did it in May 2016.

[John]

Sunday Robotics May 2016. Wow. Overnight success right there. If it trades at even half of how Shanghai priced more threads in Cambercon it will be over 500 billion in less than two years. Okay, that's a big step. It will break the venture model if they hold has a shot to deliver the number one fund in VC history benchmark on an absolute tear. Quantient says Cerebras Is pretty funny because you can just imagine the origin story being some boomer non technical manager going okay, but why can't you just put 50 gigs of L3 cache on this chip and the engineer being put on the spot and going I guess you could someone else in the comments here chiming in. I, random history major had a much less important version of this conversation with my college roommate. Fancy engineer doing computer vision stuff one time and still feel really good about it. I think it helped just weld the thing that does that onto the other thing. Have you considered building the entire plane out of the black box? But it works and the plane goes Mach 10. That's exactly what happened. They should build planes out of COE2. What's going on with CO2?

[Jordi]

They did the B. They did the B that same year.

[John]

Ooh, in 2016.

[Jordi]

Yeah.

[John]

Overnight success. Interesting. Back to back rounds in 2016 and then just trough of disillusionment for a decade. Not really, but I mean it was like Cerebras was pretty quiet for five or six years. Like it took a while to actually get to scale. And you can see it when you talk to the founder.

[Jordi]

Apparently they did. Yeah, well they did the C in 2017. So they were making progress. But certainly, certainly you can imagine some of the investors saying ah, say I think I might have been 10 years too early.

[John]

Yeah, I mean what a good origin story. They worked together at Seamicro, an ultra dense server company they sold to AMD in 2012 and then they started Cerebras together in 2015. Five industry veterans, Andrew Feldman and some other folks joined. Andrew Feldman has been on an absolute tear. Generational run even. Well, let's move over to China. Donald Trump is meeting with Xi Jinping this week and you were sharing some info on how many journalists are going over there.

[Jordi]

They're calling it a field trip.

[John]

It's a field trip.

[Jordi]

They're calling it a field trip because Tim Cook is going, Larry Fink, Steve Schwarzenegger.

[John]

I thought it was journalists, but I guess it's tech people.

[Jordi]

Jane from Citi, Chuck Robbins is headed over there. A friend from Cisco, David Solomon.

[John]

Interesting.

[Jordi]

And a whole bunch of others, I guess Elon is supposedly on the trip as well.

[John]

Hopefully they can get a word in edgewise because the vast majority of the discussions will obviously center around the war in Iran. This is from the Wall Street Journal. As the heads of the world's two superpowers meet in Beijing this week, President Trump and Chinese leader Xi Jinping will have another nation looming over their summit Iran. The long anticipated meeting has been delayed once due to the US And Israel's war against Iran which had led to the closure of the Strait of Hormuz. Trump is eager to move on from the Middle east war that is sapping his domestic power and straining the global economy.

[Jordi]

As of this morning, the peace deal was according to Trump, on major life support.

[John]

On major life support. Is that good? This is better than it being dead. So hopefully we get a peace deal because if you're on life support sometimes you could have a miraculous comeback. I don't know. That's what I'm pulling for. He will land in Beijing prepared to push China which relies on Iran for low cost oil in their transactional relationship to help broker an agreement that ends the conflict. Xi Jinping also wants the fighting to stop as Middle east turmoil restricts China's oil supply supply and shrinks countries ability to buy Chinese goods. Finding a resolution could raise Xi Jinping's stature as a global statesman who swooped in at the precipice of a possible military escalation. Trump on Friday threatened to resume Project Freedom.

[Jordi]

The U.

[John]

S led operation helped ships navigate the straits safely, adding this time that the operation would include quote, other things. Very ominous. So I think there's a few different things. So Trump the deal on life support. But most recently he rejected Iran's latest response to a U.S. peace proposal. They're going back and forth. Oil prices have climbed amid fears that roughly of a prolonged disruption through a choke point that carries roughly one fifth of global oil flows. And the summit is focused on heavily on Iran, but also trade deals, specifically Chinese purchases of American agriculture, energy, aerospace products and some other related investment mechanisms. But the tech industry is obviously hoping to like wind down the conflict peacefully and quickly and then move on to discussions of export restrictions, GPUs, the AI supply chain, rare earths, all the different things that go into what the tech industry needs to flourish. But I was thinking we wouldn't get that much movement or that many soundbites from this trip based on how large Iran is looming. But with all of those tech CEOs there, you would imagine that there's some conversation that you think they might be clip farming potentially, potentially or farming potentially frame mogging each other. You never know. Tyler, what do you think?

[Tyler]

Yeah, I think it would be interesting if it's also, you know, at a higher level than just the supply chain because like last week there was all the news about right doing the new AI regulation, right, like what's going to happen? Like are we going to do a bunch of tests before the models come out. It seems like they're kind of moving away from that, like less kind of safety focused.

[John]

China should be like, send us Mythos to give us unfettered access, ideally, like enough to distill it really quickly. And then we will also say whether or not it can be released in China.

[Jordi]

Well, why stop there? Why not just send the weights?

[John]

Yeah, just send the weights. That's. That's actually way more easy.

[Jordi]

We'll inspect it.

[John]

Yeah, way more efficient. We'll inspect it. We'll make sure that it's okay for the Chinese population.

[Tyler]

Yeah, but like, we've talked about this a little bit.

[John]

Actually send all the GPUs I need to run it to. Sorry.

[Tyler]

Like we've talked about a little bit. But like, there are people in China who are actually worried about, like the, you know, very, like, safety pills.

[John]

Yeah, yeah.

[Tyler]

But it seems like people going over there, like Tim Cook.

[John]

Yeah.

[Tyler]

I mean, there's Elon. These people are not going to be arguing in favor of, like, safety. It'll be very interesting to see if.

[John]

I mean, we've seen the Chinese. Joe Wiesenthal. There might be a Chinese. Eliezer Yudajkowski. We must find him and surface him. Who knows? But no, I mean, of course, some international collaboration there seems very, very important in the long term. Everyone agrees on this.

[Jordi]

Oh, right. Before we get to our first guest, run through it, Palmer brings up an important point. It's time for the United States Postal Service to ban junk mail.

[John]

Ooh, I love that.

[Jordi]

Unsolicited spam calls are already prohibited by the FC. Emails are heavily regulated by the CAN Spam act of 2003. Junk mail is the majority of mail. 100 million trees per year. Enough. It really is way too much.

[John]

This is very interesting. I put all of the, all of the blame, or I guess the credit. I gave all the credit to Google with the fact that I don't get spam emails. I get emails if I buy something online and I forget to uncheck the box and that's kind of on me. Or if I'm subscribed to a newsletter and it gets boring and I'm like, ah, this is junk. I'll need to deal with that. But, like, very rarely do I just get a true spam email. Just like truly slop junk. Like just complete nonsense. It's pretty, pretty rare. And I think some of that's the filtering. But also the can spam apps seems to be somewhat effective. I wind up Getting a lot more spam spam phone calls and a lot more spam text messages these days than spam emails in terms of like cold outreach that's completely undirected. And so yeah, maybe they need to expand the Can Spam Act. Shouldn't it be the Can't Spam Act? I don't know why they call it can, but it has been successful, at least in email. But I agree with this. This is good. Palmer says it's insane that America has given a monopoly on letter delivery to a quasi governmental agency that then uses it to flood our homes with useless garbage against our will. America would never allow FedEx, UPS, DHL or anyone else to force this on us. Even ignoring the wasted taxpayer money, insane moral hazards and ecological impact, the lost time and productivity is inexcusable. I agree. If the average American spends only 30 seconds sorting their mostly spam mail each day looking for the real stuff, that's over a billion dollars. Well, Earth Class mail, Palmer. I think you need a P.O. box that scans the emails or scans the physical mail and delivers it to an email inbox. Throw OpenClaw in front of it and have it decide what makes it through.

[Jordi]

But you definitely don't want have openclaw devour the slop for you.

[John]

Yeah, no, there's actually a button in Earth classmail and many of the other virtual mailbox services. You can send it to the shredder. You can say that is shreddable and you could automate that potentially. But yeah, people are sharing that there are ways to unsubscribe from junk mail. Opt out prescreen.com, dmachoice.org and Palmer says he's already done it. I still get pounds of junk mail every single day. Pounds every day is a lot. I feel like he's high up on the junk mail delivery. I feel like I get a few pieces a day. Probably not pounds.

[Jordi]

I get so many. It's, it's.

[John]

But pounds. You think you get pounds? We need to weigh your junk mail. My junk mail? Your junk mail. I can probably get a junk mail.

[Tyler]

I don't know if maybe I get one mail piece of junk mail like a week. I don't really check my mailbox.

[John]

Just say you're low ltv, bro.

[Jordi]

Yeah, I think I'm getting like, I'm like a quarter.

[John]

Oh yeah. He definitely is not in the market for, you know, random for A$79 per month. What is this? Dealer mandated vehicles for immediate.

[Tyler]

Yeah, I'm kind of telling on myself here.

[John]

Yeah, someone's advertising a Ford F150 here. You're not in the market, I guess. Anyway, what else is going on in the timeline before we move to our first guest? New service for SF retailers and home buyers. I will show up to your open houses wearing OpenAI or anthropic merch. I charge a 5% commission just to make. Just to fully pump up the price. It's called chandelier.

[Jordi]

Will that actually help, though? Because I think some people would be affordable, would just be like, I'm not even going to bid.

[John]

But I think some people at the open house tour might see, oh, there's an OpenAI or anthropic person. I should make my offer particularly strong if I want this, even if there isn't that much demand. I love the founder of Railway. It's great. What else going on here? New before ChatGPT release, before Microsoft's $1 billion bet, and long before plans for an IPO, there was the University of Michigan putting 20 million in AI.

[Jordi]

Pull up, Tyler, Pull up, Tyler.

[John]

What. What happened here? Like, how did this actually happen? There we go. There you go. Nailed it.

[Jordi]

Tyler, your homework.

[John]

Yeah.

[Jordi]

Learn how to get that more dialed. Because I hit that pretty often for you. And every time. I know, every time you go the wrong direction.

[John]

Yeah, because it's reversed. It's reversed on the camera.

[Jordi]

So it's just something to work on. That's just some constructive feedback. I believe that you can be better at this at this task.

[John]

This feels like the University of Michigan was considering donating and then at some point they just became aware of like, oh, well, you could also participate in the for profit. And they're like, oh, that sounds. Sounds better maybe. Let's put this in. A tiny SpaceX rival has rallied $6,000 and it's powered by a mob of zealots and a stock guru known as the Kook. Do you know who this is?

[Jordi]

The kook?

[John]

The Ku Capital LLC. I don't know.

[Jordi]

Oh, this is ASTS.

[John]

It has to be ASTS, right? SpaceX rival. Tiny SpaceX rival. Anyway, very, very funny. What else is going on? Oh, you gotta play this next Instagram. This one is so funny. Yeah, I don't think you've seen this. Jordy, did I send this to you or no? Okay, play this Instagram. The title of it is my mom is so bad with technology, she literally tried to search up info about energy drinks and accidentally set our house up as a business. What is an energy drinks? Could you imagine, like, starting with a Google search and ending up. Like creating a business on Google Maps for your exact address under the name what is in AI all the time, John. And. And people think AI will diffuse quickly. Debatable. Debatable. Cathie Wood is posting about Space X AI, the new company thanks to its deal with Anthropic X AI. Now Space X AI is pivoting from massive losses at Colossus to significant profitability as a Neo Cloud on an estimated 5 to 6 billion in annual revenues. Brilliant. SpaceX movie. Elon Musk and Gwyneth Paltrow.

[Jordi]

Yes.

[John]

Didn't know she was involved. I'm familiar with Gwen Shotwell, but I guess. I guess Gwyneth Paltrow also got an early check in. You know, she is an investor. It's totally possible that she has SpaceX allocation at this point, but I think it was a mistake. I think it was a mis. Tag. Anyway, we have our first guest in the waiting room. Let's bring in Ferdinand from Augustus National Bank. How are you doing, Ferdinand? Good to see you again.

[Ferdinand]

Hello.

[John]

Welcome back.

[Jordi]

What's happening?

[John]

Great to be back.

[Jordi]

Big day, big day.

[John]

You've been on the show before, but remind everyone about yourself, what you do, and then give us the news.

[Ferdinand]

So I'm Ferdinand. We have been charging a bank called Augustus and today we've announced conditional approval for that bank. I can give the brief intro and the brief spiel on the company, please, because when I come to the show, I have to bring a prop and a guy. Peter Thiel, of course, always said, when you have a fintech company, you have to bring the hundred dollar bill.

[John]

Ooh, there we go.

[Ferdinand]

I think we can do the same thing where we always have this little joke where we bring the $100 bill and then we ask what is the problem with this? But it's a trick question. And in our opinion, there is no problem with this. And the dollar is the best product in the history of the world.

[Jordi]

Insane PMF.

[John]

Insane PMF.

[Ferdinand]

Insense PMF. Sometimes there's smart people that tell me they're like water. What about water for you? But no, no, I think the dollar is the best price of the world. And there's this quasi infinite global demand for it, especially outside of the United States. And I think there are all kinds of ways to think about it. Europe and the US, they contribute 40% to global GDP, but they contribute 80% to global reserve holdings and global money movement. They're also like qualitative ways to think about where I think the existence and frankly commercial success of the stablecoin Stack.

[Jay]

Right.

[Ferdinand]

The global dollar account is like frankly, in my opinion, a pure expression of this thesis whereby this is the best product in the history of the world and, and there's infinite global demand.

[John]

Okay.

[Ferdinand]

So yeah, but for us, distribution is broken, right. And we think distribution breaks at the, at the clearing bank layer. Right. And what is a clearing bank? A clearing bank is the bank that, that has the charter and actually has the account at the Federal Reserve or any other central bank to actually move and hold the money.

[Quaid]

Right.

[Ferdinand]

And we think these clearing banks are made of paper. Right. We think they're slow. So if you want to move money for them, it takes a day, maybe it takes two days. They're closed on the weekends and they close after 5pm and they close on Christmas because humans run them. And we think they're kind of like they come from a different time. And we think with Augustus, the thesis is there's an opportunity to rethink that for the AI era and build that from scratch in a full stack way.

[Jordi]

Okay, what is the news today?

[John]

Yeah, Approval. We got a bank. Yeah.

[Ferdinand]

We have conditional approval from the OCC to charter. Augustus is a US Full service national bank.

[John]

Yeah.

[Jordi]

All right, so my first question. When did you know that you wanted to name your bank after Augustus Dirico?

[Ferdinand]

Yeah, someone messaged me and I think all falls down. He can buy the domain for less strong price or something like that.

[John]

So you're bullish on the dollar. I was just watching Ray Dalio. Ray Dalio on Ross Douthat. He's extremely bearish on America. Bearish on the dollar. Have you heard any of the popular super cycle theories? America is doomed. The ultimate black pills on the dollar. And how do you push back?

[Ferdinand]

Yeah, I mean, I've heard all of them. I think you can disagree with some, you can disagree with the other, but I think it's also like, it's a question of mission.

[Amir]

Right.

[Ferdinand]

Like what's the future you want to build?

[John]

Sure.

[Ferdinand]

And I think that what are the alternatives? Right. And I think in a way the mission for this company would be much less clear. Ten or 20 years ago, where it was only the euro and the dollar and nothing else mattered. And there was, there was no competition on the global stage. Right. But today there is. Right? You've got the adversaries. You've got like China building the digital yen and shipping it all into Africa and distributing it pretty nicely. You've got Russia pitching that Brics pay thing every other day and like, yeah, like we're going to get off the dollar. And have our own little clearing thing here. And so it's about mission, it's about the question, how can we secure and advance Western currency dominance?

[Jordi]

Right.

[Ferdinand]

I think like one, one instrument is to build better clearing banks to remove friction from the distribution of this amazing product. Because the product market fit is still there.

[Spencer Rascoff]

Right.

[Ferdinand]

If you talk to people outside of us, in many cases this is the golden standard. This is what people want most. It's just like incredibly hard to get.

[John]

Last question, who's the customer? How do you acquire them?

[Ferdinand]

So customers are global financial institutions.

[John]

Okay. So companies, not startups, you're not going to individuals or anything like that. At least not yet.

[Ferdinand]

Exactly nothing of that. We go to global FIs. So a bank in South America, bank of Southeast Asia, a financial institution in the global south or anywhere else and we acquire them. Right. And so we've launched Euro clearing kind of like a while ago and sold that to many of the largest financial. Right. So we do for companies like Kratton, for example, and process billions of euros for them today. And so now the hope is of course that we can be much more useful to these customers with the dollar as we plug that into the platform as well today.

[John]

Well, congratulations on OCC approval and thanks for stopping by the show.

[Jordi]

Great to see you.

[John]

We'll talk to you soon.

[Jordi]

Thank you for fighting the fight.

[John]

Have a good one. Yes, cheers. Keep the dollar strong.

[Jordi]

Great to see you, dude.

[John]

Goodbye. Up next we have Spencer Rascoff from Match Group. Welcome to the show. Show. Fantastic entrance. Very quick. Sometimes I have to do a whole ramble but for those who don't know you, please introduce yourself a bit. I'd love to go back a little bit about your career and then I want to see where Match Group is going.

[Spencer Rascoff]

Yeah, great to be here and thanks for what you do for technology and also for the LA tech community. It's great.

[John]

It is fun.

[Jordi]

You know, it's great to long LA of us to. To do this here.

[Spencer Rascoff]

I appreciate it. I grew up here and I've been, you know, I've been moved back here about 10 years ago and have been all about promoting the LA tech community. I started a company called la, which is a media company to promote LA tech.

[John]

Started that.

[Spencer Rascoff]

Yeah. So yeah, quickly about my background. I did some time on Wall street and then broke free from that.

[John]

Thank you for your service.

[Spencer Rascoff]

Thank you. Not enough people wanted to do something more entrepreneurial. My first startup was hotwire.com, which we sold to Expedia. Then I was at Expedia briefly And then I left to start Zillow. I was the CEO and co founder of Zillow. Ran it for 15, 16 years and then kind of retired for a couple of years. Angel invested in new startups, incubated new startups, mostly with former Zillow folks, and then stepped in as CEO of Match Group about a year and a half ago.

[John]

What does that recruiting process look like? You know, it's like they could have gone with someone who was actively a CEO. They tried to pull you off the beach in some ways. Like, what's that conversation? Like, why you? I mean, yeah, capable and.

[Spencer Rascoff]

Well, I was on, I was on the board and I'd been on the board for about a year.

[John]

Okay, okay.

[Spencer Rascoff]

And when the opportunity presented itself, the board turned to me and said, what do you think? And I immediately jumped at it. So I had been watching the company for more than a year from the boardroom. It's an incredible company doing really important work. Actually. I feel very personally motivated by the mission of the company. There is a loneliness epidemic. It is a real global problem. It's existential and it impacts longevity and mental health and everything about how society works. And Match Group is one of the very few companies as the leading dating app company that can do something about it. And so that's why I.

[John]

So you're on the board, you're watching when you choose to step into the CEO role. Are you? Do you have a 90 day plan? Do you have a big transformation plan? Like what were you going into? Because it's. Yeah, presumably a lot of showing up, tabula raza here.

[Jordi]

Yeah, A lot of your best ideas. Hopefully you had been, yeah, you'd been

[John]

like, hey, I told you guys to, you know, acquire this company or you know, change this or whatever.

[Spencer Rascoff]

I have this, this kind of mantra and I, I write it on the board, I put it up, there are stickers around the company of IT posters, et cetera. It's great. People properly motivated and properly organized build great products that are informed by user research that then when properly marketed, generate a lot of audience and revenue and profit and then shareholder value.

[John]

So it's like the entire business.

[Spencer Rascoff]

So it starts with people. It starts with people and motivation and organization. So that's where I started. That was the beginning of, of the 90 day plan. Who's here? Why are they here? How are they organized? And so for example, I immediately started by breaking down silos. Match Group was basically a roll up.

[John]

I was going to ask you about it feels like the ultimate siloed organization.

[Spencer Rascoff]

It Was, it was. It was basically a holding company and I transitioned it to being an operating company. So Barry Diller's ISC bought the cat, bought a lot of the companies in the category. Started with match.com in Dallas, then Plenty of Fish in Vancouver, OkCupid in New York, Tinder in LA, Hinge in New York, Pears in Tokyo, Me Tik in France, and on and on. And there are 25 brands that have been assembled. And then it spun out to IAC shareholders about six or seven years ago. And a lot of the hard work around integration was never done. So that was where I first focused my attention was on people, organization, motivation, employee engagement. And then we moved on to product. And at that point I took on the role of running Tinder myself because Tinder, well, obviously with a great team, but being essentially CEO of Tinder, Tinder's the number one dating app.

[Jordi]

I got this with the team, right?

[Spencer Rascoff]

It's the number one app of 166

[John]

countries writing marketing copy.

[Spencer Rascoff]

I haven't gone that far. That's where we still have a great team. But look, it's almost two billion of our three and a half billion of revenue and it's by far the largest dating app worldwide. And yet it had sort of lost its way in terms of innovation. It hadn't been founder led for a long time. It hadn't prioritized user outcomes, it hadn't had an innovative product roadmap. And so we recast all of that about six months ago and we've made enormous progress in just six months. And I shared a lot of the metrics last week on earnings. We are turning around Tinder and it feels great.

[John]

That's amazing. How do you think about desiloing? Because I guess my big question is like, how important are the individual brands? Because I imagine that it's the last thing you desolo silo is like, oh, if you're a match.com user like now, surprise, you're just. It's the Tinder brand. Because you could do that. Like, it's totally possible to acquire a company, change the name, maintain most of the user base, but that feels like the last thing that you would do. But why?

[Spencer Rascoff]

Yeah, what we've started by doing is integrating a lot of the backends, I'm

[John]

sure, like finance, legal, HR and then also databases.

[Spencer Rascoff]

But even the back ends of the product.

[John]

Sure.

[Spencer Rascoff]

So for example, blk, our app for black daters, and Chispa, our app for Hispanic daters, and Match.com, like all of these now have an integrated back end. So we launched a new feature and it goes out across a dozen or so different.

[John]

Yeah, so like one cloud platform, one set of SREs and engineers.

[Spencer Rascoff]

What we haven't done yet is some of the liquidity sharing that I think maybe you're getting at it, which is, you know, should we show a Tinder user to an OkCupid user or a plenty of Fish user to a BLK user? We've done a little bit of cross sell and that's been very effective. So you'd be on one of our apps and you'll get a message that says, hey, you've been invited to join the league. Tap here. And now your profile is kind of ported over into the league.

[John]

Got it.

[Spencer Rascoff]

And now you're searching in league. That's driven a lot of audience growth and revenue cross sell. But that's kind of where we started.

[John]

What is the dynamic of being this roll up? Because is there some sort of adverse selection or some weird market dynamic where there are founders or entrepreneurs out there who basically say, if I start a dating site and I get anything going, I'm going to be able to sell to these guys because they want everything. Is that something that happens?

[Spencer Rascoff]

Yes, it does. And I mean, I guess I would describe it this way.

[Alex]

Every business.

[Jordi]

Has anyone sold multiple companies to us?

[Spencer Rascoff]

No, not that I'm aware of.

[Jordi]

There's no Nikita Beer.

[John]

There's a couple of these serial entrepreneurs in Silicon Valley that do this type of thing. I mean, you'll see it in like cybersecurity or enterprise software. It's like, oh, he sold three companies to Google that do basically the same thing.

[Spencer Rascoff]

Yeah, no, we haven't had any repeat, repeat sellers. But look at Zillow Group. Yeah, we bought 17 companies during my time as CEO of Zillow Group. So far we've bought kind of one and a half in my year and a half year. So we bought her, which was the leading lesbian or Sapphic app, and then we invested last week $100 million in sniffies, which is the number two app for non heterosexual men with a right to buy the rest of that company. So we made those two moves so far. But there are a lot of startups in this space. There always have been, there always will be. Because every 15 to 22 year old starts dating and they think, oh, these dating apps are not great. I can build a better one. And it's easier than ever to build a new app or website, obviously. So I think the competition will keep coming. The challenge, of course, is this is a network effects business and people tend not to want to use a new network because there's a cold start problem. So even if a new app has

[Jordi]

great functionality, network effect very clearly. But at the same time, is there also some advantage that new platforms have?

[Spencer Rascoff]

It can be sort of a nightclub, kind of a hot dog.

[Jordi]

You're the first one there. You're the first one there. Big fish in a urs.

[Spencer Rascoff]

Yeah, I mean once you start solving the Cold star problem, then I think new brands can take on some momentum, but it's very difficult at the very beginning. This is of course the put and the take with a brand like Tinder, which is an older brand, has massive brand awareness. Everybody knows Tinder. Everyone also has an opinion about Tinder. And so now we have to work really hard to change the product, improve the marketing to try to regain resonance with Tinder. So features like Double Date, which are doing amazing. About a quarter of Gen Z users on Tinder now use Double Date, where two friends kind of join up, create a joint account and then link their profiles. Now they're swiping on pairs and then there's a four way chat.

[John]

There was a grouper that was doing something similar to that with three and three.

[Spencer Rascoff]

That's right.

[John]

And I don't know where that wound up, but we didn't buy a fascinating idea.

[Jordi]

Every company you've mentioned so far seems very demographic focused. How are you thinking about new technology? I feel like there's a bunch of people that are thinking about how to use AI to create dating app experiences. I imagine you guys are already using a bunch of AI.

[Spencer Rascoff]

We use AI constantly in the product. There are a lot of startups that are creating AI only products and we actually incubated one with Justin McLeod, the founder of Hinge, and then spun it out. So we're the largest owner of a company called Overtone, which hasn't launched yet. But the founder of Hinge is the founder there and we're the biggest shareholder that's building an AI specific product.

[Jordi]

Like let's spin it out, we'll buy you back in a few years.

[Spencer Rascoff]

So there may be. That might be the first repeat seller.

[Tyler]

Yeah.

[Jordi]

Why Wise.

[John]

What does it only mean? It means you're dating AI.

[Spencer Rascoff]

No, no, no, no, no. We, we don't support that. It means that your experience is one where kind of it's AI guided. So rather than you reviewing lots of people. Sure, sure. Holding your hand along the way. We use AI in all of our products in so many different ways, even

[John]

just to Sort the stack of matches.

[Spencer Rascoff]

Yes. The recommendation algorithm. Recommendation, that's been AI since day one and ML powered. But we use AI for, for profile creation. It can be very daunting to look at kind of a blank. Tell us about yourself. And so we use AI to tease out information about your profile.

[Jordi]

Have you gotten pretty good at detecting deep fakes?

[Spencer Rascoff]

Yes. So that was one of the first things that I focused on is something called face check, where you have to record a video selfie of yourself. And that's reduced interactions with fake accounts or deepfakes by about 60%. So we've rolled that out in almost every country, globally, across multiple our brands.

[John]

Yeah, I saw a fascinating video of how people are trying to get around it by having nine fake images, defaked images of some person, and then the real person who's operating the account will like style transfer their face to look like a Renaissance painting. And you will just assume that it's like, oh, this hot person that looks exactly like. You know, it's nine AI photos is like, oh, they like painting and they happen to paint some random guy. But then that's the person that IDs the paycheck. So I imagine it's a cat and mouse game.

[Spencer Rascoff]

Yeah, it's a cat and mouse game. The bad guys are pretty good, but we're better and we have to stay a step ahead. We've made a lot of progress.

[John]

How valuable is community feedback in that loop? Because I imagine that if there's a system that you build, someone's always going to try and find some edge around. But I've been surprised that the Community Notes system on Axe has been pretty robust. And it's been like, you can always just ask the LLM, is this real? But the Community Notes often surface things in interesting ways.

[Spencer Rascoff]

Absolutely. So user reports, bad behavior or fake accounts. That's an important signal for us. And now we have a system that actually kind of cross bands. So if we detect a fake account on one app, we take it off of all the accounts, all the apps. So that also improves trust and safety across the whole metric portfolio.

[Jordi]

I have a buddy, startup founder, probably eight years ago, thought he, he'd be cute and try to market the startup that he was working on. On one, one of the Match Group services got banned and then got banned from basically everything. And so he's like, I guess I'm destined to be alone in this cold world.

[Spencer Rascoff]

Sorry about that. We don't, we don't take kindly to promotional or fake accounts.

[John]

Yeah, yeah. What have there been Companies that have been trying to sell services on top of your platforms, like auto swipers and stuff.

[Spencer Rascoff]

There are, yeah, there are some startups that try to do that.

[John]

I wouldn't even necessarily call them startups. I guess sometimes they might be, but they might just be like operations.

[Spencer Rascoff]

Yeah, there are. We don't allow kind of automated like scrapers or auto swipers or those types of things. So when we find out about those. We take them. We take them out.

[John]

Yeah, yeah, yeah.

[Jordi]

Do you think the AI boom has hurt L A s prospects as a startup hub?

[Spencer Rascoff]

Oh boy. Yeah, it's.

[Jordi]

I mean we do because like we were sitting around prior to starting the show. Yeah, we're sitting here like we work in tech.

[Amir]

Yeah.

[Jordi]

But we don't want to leave L A. Yeah. What possible business could we start in L A?

[John]

It's not hard tech and we have this idea. Media.

[Jay]

Media.

[Spencer Rascoff]

No, this is, this is kind of, this is what makes LA la. A couple years ago when creator economy was booming, even, even crypto was, was, you know, L A had a crypto moment and NFT moment and then also when direct to consumer and like celebrity food and beverage brands, those types of things. When D2C was, was hotter, I think L A was booming even more. And clearly we've lost a little bit of market share and mindshare to, to the Bay Area as this AI boom has happened. So it's a bit of a bummer for those of us in la but you know it's in some ways the

[Jordi]

gravity of la, which is like entertainment, the consumer, media, hard tech. Right. Just like sort of continues and it's very hard to. But it, but I think you know, the long LA contingent deserves credit in some part for El Segundo.

[Spencer Rascoff]

Totally. A SpaceX or Android IPO will be massive service. Titan was, it was a nice moment, obviously the honey exit was a nice moment but you know once SpaceX gets public I think that will be pretty amazing for the ecosystem here. Obviously much of some of it's moved to Texas but there's a lot of pent up wealth which will become recycled into angel investments into the rest of the LA tech ecosystem.

[John]

Yeah, if you look through or you imagine looking through like all the KPIs that you look at over a quarter or a year. Are there any metrics that have shown the clear like pre AI post AI like kink in the graph. Like we were looking at the number of books published on Amazon.com and it's gone from 100,000amonth to 400,000amonth. Clear AI effect. You can see it just grow now. Is that good or bad? It's probably fine because they have recommendation algorithms. They can filter that stuff out. But I'm just wondering if there's any like. Okay, we can. I imagine you can, like, see Covid in your chart.

[Spencer Rascoff]

Yeah. You saw Covid, and then you saw kind of the COVID hangover.

[John]

So. So Covid was a spike for you

[Spencer Rascoff]

because everyone were sitting at home. They're on their. Talking at their phones and lonely and connection.

[John]

Yeah.

[Spencer Rascoff]

And then people went back to work. Kind of dating apps fell out of favor. Well, one internal metric is just pull requests. Now that I'm doing so much internal AI coding, pull requests are up. They were up 40% year over year a couple of months ago. Now they're up 60% year over year. So basically, the amount of code that our employees are writing. Yeah.

[John]

Is the question that I have for all the CEOs that are seeing incredible gains with, like, AI agents and coding agents. Like, the PRs don't pay the bills, you know, like, they don't. And I'm always wondering, like, you know, Meta was spending like billions of dollars token maxing. And I think it's great. But when I open up Instagram, I'm like, is it better? Like, I haven't seen a new button. Great question. And so. So I imagine a CEO, you have to sort of grapple with this. I'm super optimistic, obviously. But we're all.

[Spencer Rascoff]

We're all going through this.

[John]

Right?

[Spencer Rascoff]

So. So our approach to it is we have to pay for these AI tools.

[John]

Yeah.

[Spencer Rascoff]

You know, for us, it's 5 to 10 million bucks a year that we're spending on AI tools from basically nothing.

[Jordi]

Yeah.

[John]

18 months new opex.

[Spencer Rascoff]

So we're slowing down hiring somewhat, and that's how we're choosing to fund it.

[John]

Sure.

[Spencer Rascoff]

But in terms of when do we start to see the actual benefit? You know, CEOs and CFOs are starting to ask that question more and more. I'm asking it more and more. I think we're benefiting from it. It's hard to. It's hard to feel it.

[John]

Yeah. I feel like the optimistic cases that in a few quarters we're seeing case studies like, okay, yeah, we had an engineer run a bunch of a B tests, automated running overnight. And we found out that, like, the pricing on this page was better this way, and it actually created a lift in revenue. Something like that.

[Jordi]

Yeah. Or a SaaS company says, hey, we added this product features originally going to be. We were going to build it in three years. We built it now and it's ramping revenue and paying for all of this token.

[Spencer Rascoff]

Our best example would be the first week of January. We decided to, as part of the Tinder turnaround, to focus on in real life events. We know that young people in particular really want to meet people in person. They want to get off their phones, get off the apps. And, and so first week of January we made that decision. March 12th we had a product event here in L. A that demoed all these new changes to Tinder and between the first week of January and March 12th. So in just a couple months we went from a standing start because of AI to shipping in app in real life events in LA. And we never could have pulled that off without AI. It was an AI sprint that made a product launch in two or three months, which would have taken 6 or 10 12.

[John]

Is that productivity improvement changing your or potentially changing your thoughts around like incubating new properties? Like I'm imagining you could go much more niche. You mentioned a few of the niches, but you know, there's like famously like farmers only, which I don't know if you own, but like we don't own that one but.

[Jordi]

But the one that got away.

[John]

But that's an example of like a much more niche community that the maintenance and the opex associated with running it at Match Group is probably too high. But if you drop that by 10x with AI, then maybe you can go after like you know like Hollywood media executive dating site or something.

[Spencer Rascoff]

I mean Upward is an example of this. So Upward is our Christian brand also kind of traditional values, which is something that obviously has a huge addressable market, but it's not 100% of the population mainstream. Hinge, for example, which we own, goes after kind of.

[John]

Yeah, all of was that homegrown and

[Spencer Rascoff]

Upward was an incubation. But now because of AI, we're able to put more resources into it and accomplish a lot with 5, 10, 15 people, which.

[John]

And then it just becomes an audience acquisition problem which you have solved because basically everyone.

[Spencer Rascoff]

Yes, we can, we can cross sell people into it, but we also can have a pretty innovative roadmap with a small team because of AI.

[Eric]

Yeah, yeah.

[Jordi]

So you can actually roll out all Instagram hinges. Biggest competitor?

[Spencer Rascoff]

No, I think. Well, if by Instagram you mean people meeting each other on Instagram. No, if by Instagram you mean people sitting on their couch and doom scrolling and choosing not to get out there and date. Yes. So I mean Our biggest competitor at Match Group is just inertia. It's just people's loneliness and sort of doom scrolling on TikTok or Instagram or other social media, even Netflix or YouTube. We need people to put their phone down and put themself out there and go try to meet new people. That to us would be a flip of a headwind into a tailwind and generationally that's a little difficult. A lot of Gen Z is pretty nervous about meeting new people or isn't sure it's worth the return on their time or maybe in some cases didn't develop the social skills because the pandemic caused them to miss a couple critical years. And so it doesn't come as naturally. This is starting to change and the double date is an important part of this. In real life, events are an important part of it. That's why they've been so central to the Tinder turnaround.

[Jordi]

Have you thought about making products in the wedding category at all? Would you ever do wedding registries? Prenups?

[John]

We get a pipeline.

[Spencer Rascoff]

Well, so.

[Jordi]

Divorce. Welcome back.

[Spencer Rascoff]

A new member of our board of directors is Raina Mos, the CEO of the Note Worldwide. So. So no, Match Group isn't doing it, but we're very lucky to have Rayna's expertise as the leading.

[Jordi]

Yeah. If you reactivate an account on any of the platforms after 10 years, divorce support

[John]

add on. What about advertising? I mean I know many of the platforms have pro plans or paid plans, but. But what is unique about you have a lot of attention, you have a lot of eyeballs. What's the story been with.

[Spencer Rascoff]

We have a pretty relatively speaking small advertising business considering how big our audience is, make less than $100 million on advertising out of our almost 4 billion of revenue. It's.

[Jordi]

We love advertising. Sorry.

[Spencer Rascoff]

You know, I mean the way we make most of our money, almost all of our money is subscription revenue where users pay for extra features, extra powers. You know, some of our competitors have really leaned into advertising and, and I think advertising can improve the user experience, but sometimes it cannot. So you need to be very careful.

[John]

So there's two classes on ad monetization. Like one is that Twitter never got good at ads because people aren't in that lean back shopping mentality. And then the other take is it's an engineering problem. And if they just had the meta engineers building that matching algorithm, do you see one of those being more important than the other?

[Spencer Rascoff]

I mean I think from my Zillow experience when we, we had a pretty big ad business at Zillow and when we had endemic advertisers, the, you know, the, the, the moving companies, the mortgage companies, the title insurance companies, tightly integrated into the product that was, you know, that was ads as product.

[John]

Got it.

[Spencer Rascoff]

Ads as improving user experience in this category. We also have done some of that.

[Quaid]

Sure.

[Spencer Rascoff]

And the ads for example on Tinder are integrated in. So you right swipe on an ad, you left swipe on an ad the same way you would right swipe or left swipe on a user. So because it's endemic in that way and it's pretty tightly integrated, the ads perform very well. But we're much more focused on driving user outcomes and getting people out on dates. And so the subscription revenue more aligned with the users is more aligned with user outcomes.

[Jordi]

Did you ever invest or do anything around the housing problem we have in this country? Given that you're at Zillow, can you

[John]

solve the housing crisis for us?

[Jordi]

No. No. I mean, I would like you to take a run at that at some point. You know how much demand there is.

[Spencer Rascoff]

You know, there's obviously an affordability crisis. There's mortgage rate lock in. If we could find a way to make mortgages transferable, that would be massive. Tons of people are kind of stuck in their homes at 2 to 3% mortgages. They're not in the right home that's right for them anymore, but they can't afford to.

[John]

That's bad for five or six if you bring the mortgage with you.

[Spencer Rascoff]

I mean it's. You basically can't do it. You have to. There are some startups that have tried. I looked at incubating some startups to do it, but all the stars have to align. The buyer has to match your credit. It can't be done. Essentially in the current regulatory environment that would be a massive unlock, more real estate development. So just more builder friendly legislation would be very important. That's something that some other states, not California, have done a better job of. California has been a laggard in that way. You know, I have incubated and invested in a lot of startups that help real estate agents use AI to be more productive. I do think that's a bit of a limiter as well. There's one called House Whisper which I started with several former Zillow people, which makes an AI assistant basically for real estate agents and gives them incredible AI superpowers. So that's a part of the unlock as well. But you know, we don't have a demand issue, we have a supply issue in the us so we need more supply, we need more houses built. We're missing about a million homes that basically weren't built after the financial crisis. This goes all the way back to 2008. Builders were building a million homes a year and they went down to two or three hundred thousand for four or five years. And so there are a million homes missing.

[John]

Yeah, it's rough. Well, thank you so much for taking the time.

[Spencer Rascoff]

Thanks for showing us.

[Jordi]

Great to finally have. Thank you, you all.

[Spencer Rascoff]

Thanks.

[Jordi]

Come back soon.

[John]

Our next guest is Eric Olson from Consensys back on the show with an exciting fundraising announcement. He's in the waiting room, so we'll bring him in to the TVPN ultradome. Eric, how are you doing?

[Eric]

Fantastic. Guys, how are you guys doing?

[John]

We're doing great. Please reintroduce yourself and the company for the, for the listeners and then we can go into the news today.

[Ferdinand]

Love it.

[Eric]

So I'm Eric, the co founder of Consensys. We're building AI for academic and scientific researchers. To date, the product's been very search focused, focused on the literature review, use case people finding preferences for whatever work they're doing. And we are announcing a $30 million Series B today led by great boy adventures. Take the product beyond search, move into more of a workspace for researchers.

[John]

How has the actual go to market been? Obviously raising more money. So I imagine there's been traction. What's the response been like? What's the customer acquisition strategy?

[Eric]

Yeah, I mean, that has been far and away the best part of this entire process is the amazing work we get to see our users doing. I mean, these are people who are genuinely changing the world from the research they're doing. Like most AI products, we've gone mostly strike to consumer. There's so much on the ground demand for tools like this that we're really growing mostly organically. We're in a business where so many people are doing work in a lab or at a university and there's tons of networks effect sharing. So we've leaned into that above all else. And then more and more recently over the last year, we now work with over 100 universities where we sell usually directly to the library, and then they'll distribute the product to students themselves.

[John]

Interesting. Where are the models or the existing tools sort of falling down? Because it feels like anything that has a very, very short reinforcement, reinforcement loop, like research or coding can be automated very quickly. You can get really great results. But stuff like fill up that test tube, throw it in the centrifuge even if that just takes a few minutes, it's harder to actually close the loop there quickly. And so that's always been my thesis for why we're seeing such rapid advancement in cybersecurity. Because you can run it in simulation video games, but stuff in the offline world, anything that needs IRL feedback is slowed. Do you have an opinion about where all this goes?

[Alex]

Yeah.

[Eric]

I mean, there are people who are going after full autonomous scientists. You push a button, discoveries come out. We're kind of betting against that. I think, like you said, there are many parts of a research process that can be automated. We want to focus on those parts. But there are many things that happen outside of that that are very uniquely human. It isn't just the putting the atoms together, putting the thing in the test tube. There's lots of taking things from different domains, understanding the connections between them, talking to people, working through ideas and coming up with these new ideas. That is the essence of science. It isn't just what's in the test tube. And despite how good these models have gotten, it's still not great at drawing connections between things and coming up with a new idea. So we want to focus on the things that are actually automatable, like searching for papers and running many iterative searches and finding the right materials, and let humans and scientists focus on the things that are still core to science in that collaboration and that inquiry in that discussion.

[John]

Yeah.

[Jordi]

Is the bar being raised on college campuses, like, are students and researchers, now that they have AI, just expected to do two, three times as much work in a given period?

[Eric]

I mean, to some degree, absolutely. At the same time, you also will see lots of professors that will put up lots of blockers to people using AI and forcing them to do, you know, proctor tests and making sure that they're doing things that are not AI enabled. So I think that there are certain parts of it that are sped up immensely. Then there's other parts of it where professors are putting lots of safeguards up to ensure that everything is being done in the classroom exactly the way that they want. So I think it's kind of a little bit of a mix of both.

[John]

How do you think about harnesses, wrappers, just SaaS that can accelerate different pieces of the research puzzle to sort of create that operating system. Are you drawing from the analogy of the ide, the coding agent? Silicon Valley has moved really aggressively towards? Coding agents are all you need. But Cursor's still doing really well, and so a lot of code review will still happen, even In a world where AI is writing a lot of the code. So walk me through sort of how you're thinking about the future of research where there's a huge AI portion but the researcher still remains in the cockpit.

[Eric]

I think IDE is a really great core layer because you want there to be these things where you have this harness where it can do these iterative loops. You can give it feedback to say, no, go down that path or that path and pull in the things you're looking for. I think the one difference between us and maybe a coding use case is there are very discrete steps that hack sequentially. So maybe you're in a searching use case, but typically then you're moving to like, oh, now I'm writing this paper, now I'm deeply analyzing this data. So it's kind of like two actually different surfaces than just one ide. So you want to be able to build a workspace that makes it a really easy transition from, I'm in this search, I'm in this learn discovery mode, but now I need to transition to this new task. That same thing is still present. You want to be able to iterate with a model and say, hey, take me down this path. I want to explore this idea. I want to write this, I want to edit it. Okay, but now I want to go back to search because I just wrote this paragraph and now I need to find references that support that paragraph. Maybe you're taking that paper and then you're going to the next step, which could be you're running some real life experiment. Maybe you're getting off of your surface. You're in. So like I think it is, each sequence is very similar. I think the difference between us and a lot of other use cases is that there are these very distinct surfaces you need to build for each part of a research process.

[John]

How are you thinking about integration with lab notebooks? Is that going to be important at some point? Is it already important? I've been, there's been a big push for like Cursor for Bio, but I've always had struggle and I've always struggled to understand that pitch because there is no VS code for bio. All of the electronic LAB notebooks, the ELN market is closed source typically. And so. But I imagine that with the right API integration, the right partnership, you can still partner with those. Is that in the roadmap? Is that in the sweet spot or something? Maybe down the road, absolutely.

[Eric]

But I think you're bringing up another great point that even in each one of those broad buckets so now if you're moving to like some sort of writing, note taking, use case, there are different surfaces for different types of research. Your benchlings for biotech, and then there's just Word in Google Docs. If you're a graduate researcher or something. We want to both create APIs that integrate with those so you can do it directly in those services. We also think we can build our own dedicated services too.

[John]

What about for scientists that use hosted IPython notebooks? They might be on Google Colab or something like that. Some light hosted. Do you want to build that stack so you can provide that or do you want to partner with the existing tools?

[Eric]

Why not both?

[John]

Why not both? Okay, well you have the money to do both, so good luck and congratulations and thank you for stopping by the show.

[Jordi]

Great to get the update. Eric, good to see you.

[John]

Have a good one.

[Jordi]

Congrats.

[John]

Goodbye. Our next guest is Matt from Giga Energy. He made news recently because Giga Energy has scaled to $350 million in revenue vertically integrating AI infrastructure while raising just $3.4 million of equity funding. It's an amazing story of what's possible in the AI era in hard tech. People say it's hard, maybe it's not so hard, I don't know. Matt will tell us how you doing?

[Matt]

Howdy. How you doing?

[Jordi]

What's going on?

[John]

Thanks so much for taking the time to jump on the show. I heard the story, heard a little bit of the news, but I'd love to go back and start with your origin story, how you got into this business and then walk us through the shape of the business today. So where did you get started?

[Matt]

Yeah, so started this business back at Texas A and M with a couple buddies from college almost seven years ago. Business kind of started around, flared natural gas, bitcoin mining, and quickly evolved into supply chain constraints.

[John]

And was your team, were you guys studying engineering or were you just interested in crypto? What was the business? I don't know. What was the background?

[Matt]

Yeah, just super interested in bitcoin, like trying to find any way to get into it. I was like out of desperation. Large oil and gas college, my co founders, third generation oil and gas. The impetus was, hey, can you find us a well and can we mine bitcoin on it? And then from there we just kind of went on YouTube and little by little learned through phase power.

[John]

No way. So what was the first thing you built?

[Matt]

So the first thing we ever built was a 50 kilowatt modular data center in southeast Texas that mined just Like I don't know, maybe quarter bitcoin a month or something.

[John]

Yeah. And what does that actually look like? So there's a deposit of natural gas in the ground and it's being flared and some of it would be wasted, but then you're converting it. Like how much did you have to buy? What's the scale? Am I looking at something that's like a shipping container size or like building size or like washing machine size?

[Matt]

Like 20, 20 foot shipping container. Like tiny, like nothing. Nothing massive at scale. And then, yeah, you have natural gas generator on site, you're pulling from the wellhead.

[John]

Okay.

[Matt]

Stuff's going down, breaking all the time. And basically in terms of scaling that business, the rate limiter was infrastructure. So very quickly we said, how can we build our own bitcoin box boxes? And then Bitcoin, 85% drawback. Next thing you know, we're selling more bitcoin boxes and picks and shovels than we were mining the bitcoin.

[John]

Interesting. And then these bitcoin boxes, are they GPUs, are they Asics for bitcoins? Like where were we in the story of like bitcoin mining at that point?

[Matt]

Yeah, so you're 2019, you're still at like 14 nanometer chips with ASICs at the time. So very rudimentary in the field. Like flies and dust everywhere.

[John]

But they aren't repurposable because they're Bitcoin ASICs. So you wind up selling a lot of those as the market deteriorates. When do you start thinking about I.

[Matt]

Yeah, so I sell about 1.2 gigawatts of those modular data centers over like a four year tenure. So then by little. Yeah, yeah.

[John]

So yeah, we really quickly, like you're selling 1.2 gigawatts of these modular data centers. Like what is your supply chain? Like how vertically integrated are you versus more of like a systems integrator that. Than delivering that to a buyer.

[Matt]

Man, it was incremental. It was everything from like building it at Home Depot to now restoring manufacturing back in the US and just like little by little, over a seven year period, bringing it back.

[John]

Amazing.

[Jordi]

And what's the typical, what was the typical buyer back in that era?

[Matt]

Everyone, I mean we captured, we kind of had a nice niche, like lower market, middle market, public markets, you name it, we were selling to them. We were the guys with bitcoin boxes.

[John]

Okay. What we saw one of these companies that wants to, they, they purely see it as like an economic opportunity. They're putting dollars in and getting Bitcoin out and they think that the ROI will go up as they have a bitcoin price target, they come to, you buy it and then they also have to go and get the land that has the access to the natural gas line basically.

[Matt]

Yep.

[Jordi]

Yeah.

[Matt]

And also on grid utility and so kind of like basically we got a really good mousetrap. We're selling it, making great margin. Then we realized everyone we're selling them to, why can't we do what they're doing if we got great margins?

[John]

Sure.

[Matt]

So started going down the pipeline, figuring out how do we get powered land, how do we get cheap power. In the same vein, started introducing new product lines, so transformers and switchgear. In 24 we introduced, started selling that at nauseam. And then mid 24 we built a go to market function around CNI Renewables electrical and just started selling the non bitcoin miners. Realizing that kind of our electrical equipment was fungible.

[John]

Interesting. And so what was the scale of the company in 24 when you start doing that? I mean, do you have like hundreds of employees?

[Jordi]

Wait, and when did you raise that

[John]

million bucks through the fundraising?

[Matt]

Yeah, so the funny thing, that 3.4 million didn't really go to any of our growth. It just like kind of kept us alive for a couple year period figuring out our product market fit. So we raised like a million bucks in 2021 and we raised the remaining amount in March of 22nd.

[John]

Wow. And then just sales come in, just profitable business.

[Matt]

Yeah.

[John]

Were there any like, did you get

[Jordi]

thrown out of any VC office for being profitable at any point?

[John]

He wasn't in them. Sounds like you didn't even stop by. But in terms of the cash conversion cycle, did you ever have to use debt or payment terms? Because I imagine if somebody comes to you and says like I want a bitcoin box, you still have to go make it. There's like supply chain, like your working capital could explode if you're not careful.

[Matt]

It was all payment terms. So we were able to convince customers to do 30, 40, 50% down and match our payment milestones relative to cash out the door and just kind of continue rolling forward. So yeah, our customers finance the whole business.

[John]

Okay, so then take me through like the growth of the actual workforce. Like how much is in house, how big is the team at various points. How did you scale the workforce?

[Matt]

Yeah, so we had about 90 employees and last year approximately maybe 100. We're up to about 200 now this year, by the end of the quarter, really kind of continuing to scale it throughout 24. We got into renewables, CNI, electrical deviation, selling the churches, prison, hospitals, transformers, switch gear systems, and then ended up getting a massive RFQ with an AI data center. And that's like just kind of led us back to the watering hole in terms of, you know, how big the opportunity was. And next thing you know, we're selling transformers switch gear to everyone in the ispace.

[John]

That's amazing. Where do you want this to go? Are you going to raise money at some point or do you want to continue to grow it profitably?

[Matt]

Yeah. So Giga has now kind of again, we went through the cycle of life. We're selling the picks and shovels. Wait, the guys who we're selling the picks and shovels to are making a ton of money. Why can't we do that? Same thing's happening again on the AI side. We got the powered land, we have massive pipeline, multi gigawatts in terms of our capacity, we have healthy margins. And so Giga today really exists around rapid data center deployment.

[John]

Okay.

[Matt]

We manufacture all the long lead time equipment items to build a data center and we build a data center with our own picks and shovels.

[John]

Okay.

[Jordi]

What kind of, what, what kind of challenges are you facing on, on the ground specifically with like local community opposition?

[Matt]

Yeah, yeah, there's a lot of that. Yeah. We got town hall meetings all the time, talking to people, kind of walking them through, you know, hey, this is going to use less water than your golf course does. Within the area. There's a lot of noise concerns. So a lot of it's just kind of sitting down with the residents walking through. What does this practically look like in your backyard?

[Jordi]

On the noise front, what do you believe is the solution there? I think there's, every single day there's videos on X circulating where people posting like this is what it sounds like if you're living in this suburb and it's like a low hum from the generators. You've been continuously making new hardware, you know, innovations and products. Do you think there's a hardware solution to noise or is it just put them farther away from people?

[Matt]

Yeah, I mean the unfortunate thing is like almost all the setups are in compliant with local laws.

[Tyler]

Right.

[Matt]

They're probably going to be below that 65 decibel threshold. But that kind of low hum is still very irritating. The extent that, you know, you can kind of continue to innovate around the products and get lower decibels, put up sound walls, dirt mounds further away. But also, I mean, in my opinion, it is a bit of a easy thing to latch onto when just opposing the general concept of an AI data center in record.

[John]

Oh sure. So it's sort of like a strawman. Like that's not what people actually care about. They care about the bigger picture. Bigger question,

[Jordi]

why don't they dig putting them underground? Is that a solution? I've seen a bunch of people posting like very creative ideas around these things. It sounds like a lot of work to dig a big enough hole in the ground, but maybe it's.

[Matt]

Yeah. I mean on top of trying to build a data center in nine months, putting one in the ground is not on the highest priority. I would say.

[John]

Yeah, just too fast. What about energy for local like local energy prices? There's been the ratepayer production pledge signed by a lot of hyperscalers. Like how real is that? How are you. You working through those, those, those talking points when they come up at a town hall meeting?

[Matt]

Yeah. Right. Every utility or electrical tariff relative to the municipality can be different. Even within our. You have different center point or encore.

[John]

Right.

[Matt]

Two different systems, two different ways of calculating that method. There is the ability to ensure that consumers don't receive increased pricing relative to that. And there's a lot of education terms around what soft load or firm load looks like. You backup diesel gensets on site but also at the end of the day you got to be pulling four or five nines of uptime. So the LMP pricing or local marginal pricing of these sites probably will go up a marginal amount unless the hyperscalers are willing to step in.

[John]

How far do you want to go up the stack? You're building actual data centers now. Are you going to be the one racking the GPUs or are you going to partner with Neo Clouds? Are you going to be networking everything together and offering an API for a particular LLM? You could go very, very deep in the integration if you wanted to. But what's on the near term goal set?

[Matt]

Yeah, I think near term.

[Jordi]

Right.

[Matt]

Games is very much a ground up company manufacturing the stuff from the ground up with our own CAD file sets, moving the dirt, putting up the building and energizing the facility. We stop at the rack level currently and that's really what we're excellent. Very much the top down approach of heavy financial systems or you know, what not. We view our bottom up approach very novel.

[John]

So I mean do you. Is there. Is there a different financial like underwriting procedure or thought process around actually acquiring GPUs and racking them? Because it sounds like you would have a tenant that brings in their own equipment and runs whatever they want.

[Matt]

Yeah, yeah, exactly. Right. So for us, the value proposition is, hey, you need to burn these chips. We can get you 50, 100 megawatts of it online in nine months.

[John]

Yeah. And we've seen that from Satya Nadella at Microsoft. He says we actually have the chips, we just don't have enough powered shells. That's why you're in the powered shell business. That makes a lot of sense. Fascinating. What else goes into delivering a data center in nine months? It feels like. Is there a secret to not getting hung up in permitting? Is it the fact that you have a more fluid workforce that can travel across the country? We've heard stories of plumbers going on private jets. I don't know what else you can tell me about bringing your 200 person employee base to bear in a particular region that might not be right next to your headquarters.

[Matt]

Yeah. So our mantra is building in the factory, not in the field.

[John]

Okay.

[Matt]

And we did this kind of implicitly in the bitcoin mining world. We were able to turn on bitcoin sites in almost 60 days from bare piece of dirt to energized racks in the AI space. Nine months is done because we do majority of the commissioning and the integration at the factory and controlled environment. About a 95% reduction in the need for on site labor at these data centers because of our modular design and the prefabrication going in. And that's really much the focus up front.

[John]

Tents versus buildings. We heard that Meta recently shifted to tents to speed up the time to deploy their data centers. Do you have an opinion on the structure that should hold the. The GPUs, the racks?

[Matt]

The whole industry should be focused on time to Token. Right. What gets us online as fast as possible, whether that's a tent, whether that's a pre engineered metal building on site. If all 15 different companies could be aligned on time to Token, that's really what we need right now.

[Jordi]

What city has been the most welcoming to data centers in America that, that you've come across yet? Like anybody standing up? The whole town, just saying standing up,

[Matt]

you know, I mean, it's hard to make everyone happy. I would say. I couldn't name a particular place that I would say is 100% on board.

[John]

Are you worried about any of the potential regulatory or political shifts in the next 12 months?

[Matt]

I mean, I have to imagine at some point this becomes a federal issue.

[John]

Yeah.

[Matt]

Like where, you know, sign, sign an order, you know, saying you know, like there's no reason, like we should have random municipalities blocking, like AI inference coming online. It's just like not practical in any way, shape or form in terms of what we're trying to march forward. So I think that's got to come at some point. How soon? I don't know.

[John]

Yeah.

[Jordi]

How are you thinking about space? Feels like Giga has been very adaptable to date around different trends. Could we see you guys building satellites in the future? Data centers on board?

[Matt]

You know, we're, we're focused on the dirt. We're focused on. We're not the most high tech, we're not the largest. We're very much focused on, on speed. And at the end, I think that that is the difference.

[John]

Well, congratulations on the progress. Thank you so much for taking the time to talk.

[Jordi]

Yeah. Great to meet you finally.

[John]

Great to meet you.

[Jordi]

Congrats to the team on the progress.

[Alex]

Thanks for having us.

[John]

Have a good one.

[Matt]

Take care.

[John]

We'll talk to you soon. Up next, we have Jay From n of 1. He is the founder. This is his first appearance building trading agents. That may be the next AI interface.

[Jordi]

What's going on?

[John]

What's going on, guys? Welcome to the show. Jay, how are you doing?

[Jay]

I'm great.

[John]

How are you guys? Good. First time on the show. Please introduce yourself and the company a bit.

[Jay]

Yeah. So my name's Jay. I'm the founder of Nof1 were an AI research lab focused on financial markets. So we're taking a big bet on on markets as the next environment that that leads to training models that are, you know, better at trading and better at domains that require, like, adaptive intelligence.

[John]

What's your background? How do you get into this?

[Jay]

I have, I've gone back and forth between public market investing and software building software companies. So it's kind of like bringing together the two sides of my experience.

[Eric]

Sure.

[John]

Do you think Renaissance Technologies secretly discovered the transformer back in the 90s? This is a conspiracy theory.

[Jay]

I don't think so. We actually just hired someone from Renaissance and. Yeah, I don't think so.

[John]

It seems unlikely given their compute bill over the years. I think we would know.

[Jay]

Yeah, there would be signs.

[John]

There would be signs. There would be signs. But what is working in terms of financial performance in the AI world? There's two weird dichotomies, which is like a lot of the best and most profitable financial firms have been using machine learning for decades or years or the

[Jordi]

other side, you could say Jane street is an AI lab. Yeah.

[John]

And they've invested in Custom hardware and computer infrastructure for a very long time. They wrote their own programming language. Oh Camel. They've been investing in this for a long time. And then on the flip side, you have the best frontier models. When someone gives them a benchmark of like, try and trade this portfolio, we haven't seen good results. So where is the delta in your opinion?

[Jay]

Yeah, it really depends on what your goals are. I think, you know, Jane street is their goal is to make money, to make as much money per quarter or year as possible. Our goal is to train models that can generalize across markets and eventually eclipse, you know, the best human traders and algorithmic trading systems in the world over a very long time horizon. And for the, but for the first part of our goal, it's to make trading agents a thing. And that's mostly an infrastructure. They're honestly kind of like coding agents for markets. So we're building a consumer facing platform, not a hedge fund. And so our goals are pretty different. We, we kind of see hedge funds as having a more short term goal of making money and us having a much more long term goal of trying to use markets as a learning environment for AI in general, which leads to building a totally different type of company, hiring totally different types of people. There's not many hedge funds that we know of that are trying to train models where their goal is generalization versus just making as much money as possible.

[Jordi]

Yeah, talk about the consumer experience. Someone signs up, they deposit funds, your model, start trading it. Is that roughly what you're aiming for?

[Jay]

Yeah.

[John]

So to take a short step back,

[Jay]

basically our view is that trading agents are about to go through the same sort of adoption curve as coding agents, from basically no one using them today to basically everybody using them in the

[John]

next couple of years.

[Jay]

So like two or three years from now. We believe that trading without a trading agent will be like coding without a coding agent or cursor or feel like you could do it, but why would you? And yeah, so that's like the sort of inflection that we see coming. It's like the next big platform shift in investing that we see. And people have lots of ideas today around trading strategies or, you know, low resolution theses they might have where executing that is kind of hard. So whether it's a systematic trading strategy or like some more complex discretionary one, you might have an idea, but you know, it's just impractical to put it on unless you're good at coding and have a bunch of data and other things. So yeah, basically you'll be able to come onto this platform. You'll be able to describe a thesis or an idea in natural language and then the models that we are developing will be able to get you from that natural language to a fully deployed trading agent that expresses or embodies your viewpoint.

[John]

I think there's someone in the chat who knows you. Do you know Moon from Stable Diffusion? You and Pedro kicked off his career? I don't know. He's excited that you're here.

[Jay]

I have no idea who that is. Sorry.

[John]

Tell me about what the important pieces to build are for. Because you can in theory use openclaw or an AI agent to interact with like an interactive broker's API, sort of set up a trading strategy, work through that. How? Like what are the pieces of the scaffold that you need to build to like give a great customer experience?

[Jay]

Yeah, that's a great question.

[John]

So there's a lot.

[Jay]

The first hardest, you know, the hardest part in many ways is the data. You need to have really good live data coming in from basically every market anyone wants to trade. So we spend a lot of time really hammering out all the different providers and cleaning and preparing and getting it ready to be consumed by agents. So that's a huge piece of it. Like if you don't have all the necessary data, it's hard to. To build a real trading strategy. The second piece is like the guardrails, you know, lms A big part of our point and why we launched Alpha Arenas and maybe you guys saw, is to prove that alums aren't quite there yet when it comes to trading, that the models aren't very good at autonomous trading tasks basically. So we developed like a harness and put a lot of our energy into developing like a world class harness for trading and deep research queries for markets. So you get all of that on our platform and then all the DevOps and server management and basically all the infrastructure that you need to do that. Well, even on something like openclaw, we've taken, we take care of that as well. But yeah, there's a lot. And then the execution and then if you want to do paper trading or simulate out possible ideas or kind of go through a lot of iteration and refining your strategy, it's not, it's not super easy to do all this stuff. Well, yeah, that's.

[Jordi]

Would you ever partner with the public to the robinhoods of the world and integrate this into their platform where they can effectively create some type of tab where you can type in a thesis and then execute it within your Existing brokerage or do you want to own the end customer?

[Jay]

Yeah, as of right now, we're integrating with all the brokerage, so you'll be able to connect to whatever brokerage you used. Or if you don't have a brokerage, you can just onboard through one that we set up for you, like Alpaca or ibkr. But, yeah, right now, we're just a layer on top of all the brokerages.

[Jordi]

Got it. Cool.

[John]

Well, thank you so much for coming.

[Jordi]

You have some news? You have some news? You raised some money?

[John]

Oh, yeah.

[Jay]

We just raised a $15 million round.

[John]

Thank you, Jordy.

[Jordi]

Almost forgot. Almost forgot. Well, great stuff.

[John]

Have a great day. Congratulations.

[Jay]

Thanks, guys.

[John]

And we'll talk to you soon. Have a good one. See you. We have Amir from Astrocade coming in in just a few minutes, but we have to talk about Laurel Supply. This is you. You were.

[Jordi]

This is important.

[John]

Everyone out there was. If you were complaining that Erewhon was too cheap, you're gonna love Lauren Floral Supply because they made an expensive version of Erewhon. This is from Andrea.

[Jordi]

Some people are. Some people are saying that it's. Yeah, more of like a tick tock studio.

[John]

Okay.

[Jordi]

Grocery store.

[John]

Okay. I want to know about the flow of, like, how the. What the Go to market works looks

[Jordi]

like, because we should have went there.

[John]

We should have gone.

[Tyler]

It's close. I think. I drive by it every day.

[Eric]

Okay.

[John]

But let's sit the table and try and understand what's actually going on here. So moral Supply, before we dive in.

[Jordi]

Probably one and a half years ago at this point, John is saying, like, okay, well, obviously, Erewhon's this hit. Yes, but obviously the opportunity.

[John]

You introduced me to Erewhon.

[Jordi]

Really?

[John]

Yeah.

[Jordi]

Because I would come in every day.

[John]

Because you were such a diva, you would insist on only eating Erewhon. And I was like, can we just throw in McDonald's once? Maybe a jack in the box, Maybe a taco.

[Jordi]

You said that a couple.

[John]

Maybe a chick Fil A.

[Jordi]

And then you piped down.

[John]

Yeah, I did.

[Jordi]

Eventually you piped down.

[John]

Yeah, but you. But you. You brought me the gospel of Erwan.

[Jordi]

I became a convert. Make remake Erewhon, but make it two to three times more expensive.

[John]

And no one would think that everyone. Everyone would come into and say, what if Erewhon. But cheaper.

[Jordi]

Called this before John.

[John]

Wait, what?

[Tyler]

I have a tweet from January of 2025. I say there's definitely a market for ultra high end.

[Jordi]

You probably heard that.

[John]

I think you heard that on the show. Wait, what Is this. Can we pull up Tyler's tweet? Where is this? We need to put this in here. Okay. So Tyler says there's definitely a market for an high ultra end or an ultra high end or an ultra high end grocery store that doesn't use plastic anywhere and tests the products for tons of stuff. Erewhon meets plastic.

[Matt]

Yeah.

[Jordi]

I'm sorry. Tyler, he's Brian Justin.

[Tyler]

I saw this tweet probably and then took it.

[John]

I don't know.

[Tyler]

I don't know when you said it.

[Jordi]

I don't know.

[John]

I think I rifted. I was. This was right around the time that I was riffing it on the show. So like.

[Tyler]

Well, maybe so totally possible. This was a reaction to Nat Friedman, I think.

[John]

Yeah, yeah.

[Tyler]

On did the plastic.

[John]

No, no, I. So maybe I might have to give you this one. I don't know. January 6th.

[Tyler]

I don't think this is a very original idea.

[Jordi]

Okay. Anyway, what is cool is like a lot of the products they're selling. Yes. Clearly they're just like packaging them on site.

[John]

Yeah. So they have flowers here. They have a whole bunch of like nuts and spices and all sorts of things. But they are sold in individual jars. Very aesthetic. Like the view. There's just so much less.

[Jordi]

Nick Shawa says they should call it Whole Foods. So this is the beauty inside. This is the beauty of capitalism.

[John]

Yes. What.

[Jordi]

Which is that every great idea eventually can be usurped by doing the exact same thing, but just doing it slightly

[John]

at 3x the price. Is it actually 3x the price? I don't think we got to go and understand. So Michael Miraflor has a post here. He says important to note that this is on Holloway Drive on the same street as Holloway House or Soho House, Holloway, whatever the official name is now. And it's right next to of Barney's been array. This corridor is going to become one of the cool person destinations. Completely insufferable. Must visit if from out of town. Influencer destinations in la. Another pink wall, if you will. Interesting. I remember the pink wall. Did you ever take a photo at the pink wall? Yeah, I drove by it a couple times. I saw people taking photos. I never stopped. I knew that AI would be able to make a pink wall behind me if I wanted one on demand. The street is also a staging site of sorts for delivery robots. So yeah, lots happening. Interesting. Okay, so inside Laurel Supply, the new grocery store, luxury grocery store that just opened in West Hollywood, there is a video. Should we watch this or do you have another take? Jordy what do you want to break down?

[Jordi]

There's a video inside the store.

[John]

There's a 1 minute and 30 second video from Mike Make LA Great Again inside Laurel Supply. And we can play this this video. It looks like it's a download of a TikTok. First look Laurel supply. And it's a popular new American restaurant, Laurel Hardware. There's a couple others. It's so overpriced, says Shawnt. Erewhon down the street is so much better. It's making Erewhon look cheap. Okay, let's play this. Maybe turn this up.

[L]

Refrigerator. All the fruits and vegetables are 100% organic and meticulously placed. You'll find an organic smoothie, juice, coffee and matcha bar with plenty of indoor seating. Or you can just enjoy them while you shop. Immediately to the left you'll find a health and beauty section. And this is a little grocery store section. And she showed us products from all around the world. This Runway product caught my eye because, you know, Devil wears Prada. But one of the most unique things about Laurel Supply is this stone mill. It was imported from Ukraine and it allows them to control the production of their in store goods. You know how you can go to Europe and eat all the baked goods like a heer and not gain any pounds. A lot of people say it comes down to those specific ingredients like flour. So that's what they're trying to mimic.

[John]

Flour on site.

[L]

Opening. I don't have a lot of images of the prepared food but it's.

[John]

They're just like reinventing a farm.

[L]

If you have a sweet tooth, you've been warned because there's a wide selection of gelato. Their food options such as sushi and they have an organic butcher. You'll immediately know all the attention to details such as this live olive tree that they have inside and how they incorporate natural light. That was one of the big things I noticed when you walk in. I was also told they offer valet for shoppers. So those that were concerned about the parking situation, that should help alleviate it. At the time of this posting they should be officially open. Let me know what you think when you go check it out and follow me. For valet actually matter.

[Jordi]

I gotta say personally valet for groceries, places that you go to a lot is a bug, not a feature.

[John]

Why?

[Jordi]

I just, I just like parking my own car. I don't want Rand, you know, I don't, I don't, I don't need. I don't need or want random people driving my car all the time. Especially for I'm saying for a grocery store or a gym. But I. I do think it's funny. So they're like, okay, so we're.

[John]

We're.

[Jay]

We're.

[Jordi]

We're blatantly cloning Erewhon. Let's just all admit that. Let's just all admit that we're blatantly cloning Erewhon. But we gotta do something different.

[John]

Yeah.

[Jordi]

They rack their brains. What do they do for hours? We're gonna mill the flower in house.

[John]

Is that the only thing? Yeah, There was a lot of stuff there that seemed like Erewhon.

[Jordi]

That's the only thing I said, no, I think so. It looks fantastic. I like the logo. It looks cool. I will happily shop here.

[John]

Will you? Or will you just be like, it's not the same. I'm an Erewhon diehard. You're gonna switch up on your day one. You're gonna switch up on Arrowhorn.

[Jordi]

It totally depends on location.

[John]

You'd be driving to Erewhon, but I'm gonna go the other direction.

[Jordi]

I am a reserve member at Arowan.

[John]

I don't even know what that means, but it sounds expensive. That's hilarious. So funny. Well, what else is in the timeline? So Wilm and I just had an absolute banger today to the tune of 12,000 likes.

[Jordi]

Oh, last thing, because Dylan.

[John]

Yeah.

[Jordi]

Our very own Scotto texted.

[John]

What do you say?

[Jordi]

Very smart. He said they should open in the Bay or New York. Not where Erewhon already is.

[John]

That's right.

[Jordi]

Very, very smart. So Erewhon has been some. Has had so much opportunity to expand within la. They've done a very good job. You can't really drive 15 minutes without running into one, which is a great feature if you want to just pop in for lunch or whatever. But they've been.

[John]

They should do a points match when you're leaving American Airlines or United. They'll status match you. If Laurel Supply status matches you on day one, they might win you over.

[Jordi]

Maybe. No, but this is smart. They've been relatively slow to expand. There's a store blanking on the name in New York that beat them to at least beat Laurel Supply to cloning in New York. But yeah, the thing about Laurel Supply is it. It looks incredibly well done. And I'm sure the experience will be great and I will happily go check it out. But it doesn't add anything new to grocery in LA really at all. I don't really.

[John]

At last, they do what we were talking about, which is the whole brand is you go in here and There is no plastic in the store whatsoever. Like that was the original pitch that we were talking about was not, oh, it's organic.

[Jordi]

The other part of the pitch was ditch the old brown grocery bags and

[John]

do like solid gold effectively turn the bag into like an Hermes Birkin bag. And so an influencer can take a photo of it. Somebody who gets the bags can take them at home, take a photo and everyone knows, oh, you got the fancy groceries. I gotta have those fancy groceries. That's the hack. I still think launching in LA is good for like go to market in terms of like the influencer economy getting. You don't think so? You think New York and sf?

[Jordi]

No, I mean Dylan said Marin. Marin would crush Marin maybe.

[John]

But I still think the total amount of views will be higher in Los Angeles than Marin. I think there are some examples.

[Jordi]

Maybe it's a starting point.

[John]

But there's way more celebrities and whatnot. Like there's.

[Jordi]

But congratulations to the Laurel Supply team on the launch. Welcome on the show. We love talking grocery.

[John]

We have the CEO on the show. Anyway, we have our next guest we've been keeping waiting in the waiting room but here he is in the TVP and altered on the mirror from. From Astrocade. How are you doing?

[Amir]

Hey guys, thank you for having me.

[John]

Thanks for joining. Welcome to the show.

[Jordi]

It's great to meet you.

[John]

Congratulations on the progress. Introduce the product, then we can talk about the fundraising. But how are you describing what you're building right now?

[Amir]

Yeah, Astrocade basically is a social entertainment platform where anyone, and I mean anyone can create games via just natural language. Very similar to how you problem chatgpt. You can make games and for example you can say a car racing that is happening under the water and the driver is an elephant or a candy crush that instead of popping the balls with color you can form basically wards something like that. And then with a few clicks you can just publish it to our feed. And then there are millions of players right now that play your games.

[John]

Yeah.

[Amir]

And I think the part that I'm the most excited is our mission, which is sharing fun with the world. I think what we are building is pretty cool for people to use and be happy.

[John]

This seems, I don't know, like almost obvious. I don't want to degrade it, but it feels like there's been this vibe coding boom. I see a ton of really fun games we've made like simulators and whatnot. We always buy a domain name and then the question's like how do you drive traffic to it? You can't really go viral. So then you wind up making a viral video about the game and you try and get people to go to the dot com.

[Jordi]

Well, here's the thing. So the games that we've been creating are only funny to like a very. And fun like a very small group of people. Right. But they're not really fun to play.

[John]

That's right.

[Jordi]

And so what I wonder, what I wonder is like is the opera is like re skinning a bigger opportunity than like generating entirely new games because there's certain game mechanics that are just sort of tried.

[John]

I would argue that that's how, that's how Instagram starts. Like the original Instagram was like share your picture of your run with your close friends. That's what we're doing with the simulators that we build. But eventually.

[Jordi]

But there's no, there's no game mechanic at all.

[John]

No, no, no. What I'm just saying is like in terms of the actual application, like we are doing the, we are doing the, you know, the Instagram post that's just like, hey, I ran a marathon and ten friends like it. We are not creating the viral Instagram that will be like loved by everyone. We're not Professor Sendy making Wombos.

[Jordi]

General what I'm saying is like the social aspect, the sharing aspect is very cool. But if I'm making a first person shooter, there's probably some like out of the box mechanics that are great and reskinning like putting the team.

[John]

I think there's probably a lot of harness like yeah, tell us about how people are actually using.

[Amir]

You guys are actually making all the good points. First of all, and you mentioned is actually obvious when we started three years ago we also, I was like convinced that such a thing should happen. Yeah, right. It's very hard to also predict the future, but if you look at the past, the past 20 years, right. 20 years ago when Twitter launched, basically what happened is they made creation tool of text accessible to everyone with the keyboards. All these things right again. And almost everyone is the writer. Now on Twitter they do a lot of rage baiting on a day to day basis. Places or everyone right there. And the pattern what we see here is once the creation tool becomes accessible to everyone, great generational companies appear, right? Same thing four years after Twitter, Instagram when the camera iPhone4 launched with a good camera, everyone became a photographer. And it's great but also like thanks to my wife, I don't have any more privacy. And I think you guys will tell TikTok same thing and like with the videos, all you see the pattern basically is a creation tool became accessible. And what you guys pointed out is like creators from diverse background started creating this content. First person shooter. A lot of people remix new games, but also the beauty of large numbers is a lot of people actually invent new kind of mechanics. Like one of the interesting genres for us that we saw that got super viral is you have to wash, wash things. So you have something, you go wash Mona Lisa's painting, then you go wash a car, you have to clean it. And it's actually pretty addicting when you play it. It's so shocking.

[John]

That's funny. And on Instagram you'll see viral videos of people power washing old rugs that are so dirty. There's a whole genre of this time lapse of people cleaning rugs. And then it's very satisfying because you're watching something get cleaned, which I think is satisfying. But then also it's revealed to you what the rug looks like and it's very satisfying.

[Alex]

Exactly.

[Amir]

When you see things happen, you're like, oh, it's so obvious. But then you need people to create these things. And I think that's what's exciting. I think the biggest advantage of astrocad, which I really love, is the core of the experience. So number one, first of all, our platform compared to other platforms is it's engaging. You play things rather than consumption. Majority of the social platforms right now are consumption. Engagement is just so much better. It's like hearing a story versus experiencing a story. Right. Number two, which is kind of also our mission is just, it's more fun. You know, we are living in a world of a lot of the brain rot happening. And I think this is just more creative. You come out of it super happy when you play Astrokit and like you use actually your brain. So that's very, very important for us. And I think the reason I believe Astro Kid has a possibility to become a generational company is games are so innate to humans. I have a two year old and he just always playing. He's learning through play, right. They were like what? I think the latest stats I read was the 3.4, 3.5 billion people playing video games right now. Just almost half of half of humans. Right.

[Jordi]

And I think that's not this second. Right. That's like day to day generally 3.4 overall.

[Amir]

I think that. No, it's not.

[Jordi]

Because I'd be pretty worried.

[John]

Speak for yourself. I'm gaming right now.

[Jordi]

Half of humanity is, is live playing first person shooters right now.

[John]

But brain rot's not going to be an issue. Don't worry about that.

[Jordi]

There must be. Is there crazy power law with the games? Like on YouTube the power law would be like most videos Gangnam Style has

[John]

like a billion views. But the average YouTube video gets or the median YouTube video gets like 10 views.

[Amir]

100%. There's always all this creation platform. There's a power law. A lot of like, like some portion of creators, like 1 2% of the creators get a lot of plays and like they get super viral. And then there are other creators that get, they don't get viral but they get at least thousands of plays on their games. We actually like, we launched the platform like publicly around seven, eight months ago. The numbers are actually crazy guys. The stats is our MAU is like 5 million right now. Hundreds of thousands, Hundreds of thousands of creators are now creating games, games.

[John]

Hundreds of thousands.

[Amir]

Obviously like you guys are part of the open it. You guys are happy. We actually process trillions of tokens.

[John]

To make this happen. Like it's completely free. Okay, okay. Free, free, free. That doesn't sound like it's gonna make any money. How, how will you make money? Ads or subscriptions

[Amir]

potentially. We want to do ads right now. Our creators are like yeah, it's completely free. Between all these like all the vibe coding platforms we are, we're the only one that is completely free.

[John]

Wow.

[Jordi]

Won't you want to make allow creators to turn on monetization at some point? Like I feel like you're going to have people that are like nine years old that create some hit game and

[John]

you know, it's the, it's the Alex Zhu from musically philosophy of like social networks are two sided marketplaces. You have to create liquidity and like the faster you can start paying people to post, you get more professional creators. And I'm sure you're thinking about that. But

[Amir]

exactly like I think we get inspired a lot by YouTube also. Like almost, almost all these social platforms are doing that right. They don't monetize necessarily their creators. They actually build tools for their creators to monetize their games.

[John]

Sure.

[Amir]

And we are going to do something similar. We still haven't started monetization. We are focusing on the user growth. But we are going to build tools that kind of like companies can do ads on Astrocade but also creators do microtransaction and the regular type of business model that gaming has doing, I've been doing all these years. I think that gaming is just generally is a good business. It's very Profitable. It's one of the largest segments of entertainment. Larger than movies and all these things combined. Right. So I'm not so worried about monetization. We just want to make a great experience for everyone. You guys should actually play the game.

[John]

People comp the video game industry to Hollywood or the movie industry and it does dwarf it. But I wonder what the actual revenue split between like passively consumed content is versus actively played games. Because I think if you take YouTube and Netflix and Spotify and Tik Tok and Instagram, that's probably a bigger pot. To be clear. Massive, massive market, massive opportunity. Very bullish on this. This makes a ton of sense. But it is interesting that there is some. There is some sort of dynamic where like yes, 3 billion people are playing games but probably more people are still watching passive things. There's probably more watch hours on passive content. But that doesn't make you know, playing games any less important. People enjoy.

[Amir]

No, I think you're right.

[John]

Yeah.

[Amir]

So that's why I always not. I don't say normally games. We call it playable content because there's actually like very diverse set of content is they're not only games, you know, it's like playable experiences. I think from the content point of view is we are heavily towards actually ultra. We call it ultra casual. Not even hyper casual. Ultra casual. When you go to a giga casual.

[John]

Yeah. What's the average playtime? Because Final Fantasy might be like 100 hours. GTA might be 100 hours and then some small game might be a couple hours. But I imagine this is on the order of minutes.

[Amir]

Exactly. And it's exactly on the order.

[Eric]

Okay.

[Amir]

So it's shorter form actually. My wife only. My wife is one of the hardest critics. She only plays Astrogate games and like she does it when she's watching a movie. She also is playing the games because it's just so like it's. It's still like engaging and interactive but you don't need to also necessarily to focus full on versus a lot of triple games. You have to do that. And I think that's going to happen happened with the gaming industry. There is going to be still biggest studios like basically Hollywood. And there's going to be.

[John]

Yeah, I mean in the same year we got Oppenheimer and Barbie we also got like 12 other Mr. Beast videos.

[Jordi]

Are you based in LA?

[Amir]

We are in Paloto actually.

[Jordi]

I looked at that building is so ugly. I thought it was.

[John]

They recreated Los Angeles up north. It's crazy talk about the technical side of things. I Imagine this is Heavily powered by WebGL and Web assembly, but all of this is delivered in an app. And so I'm wondering where you're bumping into Apple's rules of the road because there's so many cool functionalities like haptics and gyro and cameras. And when I think about what a really robust mobile game does, it's usually using a lot of the different APIs and some of those are probably available. Are they all available? What's that been like?

[Amir]

Yeah. So we are completely right now web based and the games are HTML games. Super lightweight, is super fast to load those games.

[John]

Okay.

[Amir]

Technologically wise, I think we had multiple challenges across the way. We knew this is possible. But it's actually very hard to build such a platform. Just generally platforms are very hard to build. The first biggest challenge which we overcome is still ongoing is just creation tool.

[Eric]

Yeah.

[Amir]

How do you build these agentic system that can make everyone a game creator? Right. Remove all the skill. Because these games are being like one of the games I was showing to experts and they were saying this is a million dollar budget for a month of the team.

[John]

No, of course.

[Matt]

Right.

[Amir]

On our platform it's like $20, $10. So that was one thing. And it's all going. And we call it like is a, like Astrocade is a platform where our AI is learning how to generate fun. It's a big thing. AI learning fun is a big thing

[Spencer Rascoff]

in the AI community.

[Jordi]

Yeah. So it's not a very seemingly at least a very deterministic problem. Right. Because you have these games like, I don't know, why would a window washing game be fun? And yet if the mechanics say you've

[John]

never washed a window, you say you've never yearned for the mines. Why would Minecraft be fun? You go to the flow state. Yeah.

[Amir]

When you start washing the window, you

[John]

get to the flow state. So I mean, does that mean that there's going to be some sort of like, you know, crazy deal to be done between you and Apple at some point? Because I imagine that your consumers, you as a company will want access to the full iOS API suite. And Apple's going to say, this is an app that makes other apps. We're not really cool with it. And you're going to have to discuss that. How does that play out? Because I feel like everyone wants this to be a thing, but Apple's just sort of operating from a place of 15 years ago in terms of what the technology was capable of.

[Amir]

We haven't got there yet. We haven't launched app by the way. Yeah, yeah I know it's fully on the web. We have to see how when we cross. No, I think this is actually actually pretty good for Apple too. It should be massive distribution also like they provide a distribution but they make

[John]

a lot of money on games right now and if you're saying that we're just going to do ad supported and it's all going to be in our platform and all of a sudden it's like well we were making $2 off of the window washing game every time someone clicked the in app purchase and now you have a different business model that could be an issue. So I don't know.

[Amir]

I'm sure you're solving this is not our biggest problem right now. The things that we are focusing right now on the technology side is like another thing by the way is very hard problem and it's harder honestly than some of our AI problems. Is the recommendation system interesting?

[John]

I was wondering if that was off the shelf is it not?

[Amir]

No, it's actually pretty challenging. I don't think anybody has built such a large scale recommendation system for this type of content.

[Eric]

Sure.

[Amir]

Right. We have kind of recommendation system for videos. We have images.

[John]

Sure.

[Amir]

Games first of all are. A lot of them are open ended so you don't know exactly like video. You know I watched the whole 50% games is like a lot of other features of features of extracting features from the videos.

[John]

It could be satisfying because you were able to finish it in 10 seconds as opposed to if you're watching a 10 minute YouTube video and you click out of it in 10 seconds you didn't win the goal so you have to bake that into the weights as well. The recommender like this person was able to destroy this game but they enjoyed it and then they might not always give you the thumbs up, thumbs down signal so Interesting. Exactly.

[Amir]

That's been one of the hardest problems by the way. We're trying to solve the recommendation system and then platform like how do you manage the platform? So players are happy, the creators are happy. This is the first time that this is large scale. In few months we've got more than 75,000 games on our platform created. How do you distribute these games to millions of people from diverse backgrounds and skills? Right. So there's a lot of like technical challenges. Serving is another the infrastructure you need to build to basically efficiently serve these games to.

[John]

Yeah, I'm doing some back of the envelope trying to pull data out of you. You said like 10 to $20 per game inference. 75,000 games, that's like 1.5 million in inference. Like, are you, are you actively looking at like what pieces of the puzzle you can move to cheaper models really quickly?

[Amir]

We do that.

[John]

We do that. Actually.

[Amir]

We. For some tasks we do cheaper models. For more complicated tasks, we do. They say it's the thing is the cost of intelligence is coming down.

[Jordi]

Yeah, Right.

[Amir]

But the cost of these tokens are not because you always want to go with the best.

[John]

And the value of networks is going to keep going up. Feature.

[Jordi]

Feature request. I want to be able to go on astrocade.com and navigate based on like popularity of different games by year. So like I want to find all the games that were popular when I was like 5 years old and like 2000, like 2005. Right. I remember some of these, like web based games that were like, what was that game where you're on a little bike in these?

[John]

Line rider.

[Jordi]

You know, we have that.

[Amir]

We actually have something similar to that.

[John]

Yeah, but I mean, to the point about the record recommendation algorithm, like, is the user trained to search for that? And then is your search algorithm going to match with that if it's an abstract representation and the user didn't put the keyword line rider in their description or something? Interesting challenge, Interesting challenge.

[Jordi]

For the rest of the show today, I'll be playing line rider. So if you want to keep, if you keep watching after you leave, you'll see I'm completely distracted.

[Amir]

Actually, it's pretty calming also. It's puts you in the flow state.

[Jordi]

And you know what else is calming?

[John]

Flashbang. The flashbang's not calming. That's extremely disorienting.

[Jordi]

It's very calming to me.

[John]

Just say you want to play cod. Just tell him, remake cod.

[Jordi]

Very calming to me. Amir, it's an honor to have you on the show. I'm excited to play Astrocade and at this rate, I'm sure you'll be back on very, very soon.

[John]

Congratulations.

[Amir]

Say hi to Nick for me.

[John]

I will.

[Jordi]

We will.

[John]

Thank you so much.

[Jordi]

Cheers.

[John]

Goodbye.

[Matt]

Have a good one. Bye.

[John]

Our next guest is coming in in a few minutes, I believe. So we will click over to this very odd viral post from Wilmanitis. So apparently, fiber optics on the battlefield. We've talked about this before. Drones in the war in Ukraine will be hardwired via the thin fiber optic cables so that there's no chance of jamming them or disrupting any sort of radio signal. So this has been a popular technique on the battlefield for years now, I believe but apparently it's extremely pricey now.

[Jordi]

This is so insane. Apparently the price used to be for 50km spool was $300. So that seemed. That's way I used to always wonder about the economics of. Just because you're assuming, okay, this drone's taking off, it's flying miles and miles and miles. How could that make sense? But it's clearly very cheap. 300 bucks have a drone that's, you

[John]

know, and they started with like DJI drones that were like mavic fours used that were maybe like a couple hundred dollars. And there were actually some people that would buy these drones like on Craigslist or Facebook marketplace in America or somewhere else and then fly to Ukraine, take them and resell them at a profit. But still the average cost of the drone was like in the thousands of dollars. Well now 50 kilometers of fiber optics is $2,500. So a massive increase in price. And Will Menaitis says AI data centers skyrocketing fiber prices leading to Ukraine, Russia being priced out of using drones to do live leak atrocities as a scale of marketplace solution. That's it sounds schizophrenic on the outset, but it is a bizarre. Obviously he's sort of playing around with the concept, but it is a bizarre second order effect of fiber demand in America. If that's actually what's going on here. Who knows? Who knows? Well, David Sack shared some back of the envelope numbers for a 1 GW data center we talked to Giga Energy about.

[Jordi]

I'm going to quickly jump in. I think this is napkin math.

[John]

Oh, you don't think he went. You don't think he bought out the envelope for this?

[Jordi]

This screams napkin mat.

[John]

You don't think, you don't think he used an envelope for this?

[Jordi]

Yeah, I think he was writing 50. Okay, 25 to 30.

[John]

And wait, so when he says all in Capex, that's the amount of money that you spend sponsoring the all in podcast. What is that? What does all in Capex?

[Jordi]

Because he says, well, they spent, I mean, hey, the number one tech podcast in the world.

[John]

50 billion. Small price to pay for one gigabyte data center. Exactly. No, of course he's talking about the total amount of Capex, but he did use his brand name there. All in capex. 50 billion. Enterprise revenue generated 25 to 30 billion a year. Electricity cost 1 to 2 billion dollars a year. Two year payback. The boom is real. Grok fact. Checked it. What did Grok have to say? Mostly accurate. You know what Grok called it? Didn't call it napkin math. It called it back of the envelope.

[Jordi]

Well, I'm going to have to fact check. Grok.

[John]

Grok, is this more back of the envelope calculation or napkin math? Fact check from Grox's capex is 50 billion per gigawatt. Aligns with Nvidia's estimate revenue. It matches high end infrastructure as a service cloud. Leasing energy is roughly correct. Two year payback is realistic. There were some other folks that were pushing back saying that there's a lot more that goes into it, but it seems directionally correct.

[Jordi]

Yeah, I guess the question is like don't open it. Doesn't OpenAI and anthropic have access to like somewhere in the range of two and a half to three billion or sorry, two and a half to three gigawatts of compute.

[John]

Yeah, that's right.

[Jordi]

Right. And they certainly don't have 150 billion.

[John]

Oh yeah.

[Jordi]

Each. So yeah. So I feel like the numbers seem incredibly optimistic.

[John]

It's more of like forward looking.

[Jordi]

Yeah. Looking at, looking at core weave. This is not at all what we're seeing with, with coreweave.

[John]

Yeah. What happened with core weave.

[Jordi]

But we will, we will see.

[John]

So far there's a breakdown here of Core Weave.

[Jordi]

Yeah.

[John]

31 billion of in service PPE as of 3-31-2026. They leased their data centers. 1.4 billion of operating lease expense for this year. Active data data centers. Let's assume the leasing market is 10% cap rate. So cost equivalent to lessor is 14 billion. If they had 45 billion of all in capex generating revenue of 1 gigawatt active power, it's close to sacs numbers. Let's be very generous and assume they need to put no additional capex in service to the revenue guide. The assumption is wrong. The revenue guidance is 12 to 13 billion. So core weaves all in capex to revenue is 3.6x Saks beca the envelope capex revenue revenue is 1.8 at midpoint. So either core weave really sucks at this or These numbers are 50% off before we even get to margins. Interesting. Well, there's more pitches for beautiful data centers. Doesn't seem like it's on the roadmap for many data center builders. But Meltem Demur says you said make data centers beautiful. There are some good ideas in this post. Which one do you think is the most beautiful Jordi of these beautiful data centers?

[Jordi]

Let's see. I personally think that the actual image of the data center they use is beautiful, but only in a.

[John]

The Big mound. The mirror one.

[Jordi]

No, no, no, I'm saying at the top of the substack once you click in. Yeah, like the actual data center, it looks kind of.

[John]

Yeah, job sort of finished there. Why change something that looks like a blank black cube? It's good enough. Let's see. Kevin o' Leary is proposing to build a data center in Utah that will require 9 gigawatts of energy to function when fully built.

[Jordi]

Yeah, this one is getting insane levels of now.

[John]

We're putting energy use in atomic bombs units. As they say, it will dump around 20, 23 atomic bombs worth of thermal load on the environment every day. The 23 atomic bombs talking point is complete BS. By the same math, the sunlight that hits the 40 acre property this data center will be built on already produces over 50 atomic bombs worth of heat energy daily. This is a misinformation campaign we are watching in full time. Interesting, interesting. People continue to be upset about the data center stuff and putting it in ever more complex comparisons.

[Jordi]

We should have our next guest, Alex. Alex from Long Lake Longlake. He recently bought a business that you very well know and likely have used at one point or another.

[John]

Yes, that's right.

[Jordi]

Him in.

[John]

Oh, he's here. Fantastic.

[Jordi]

Is he here?

[John]

We got him all over in the colors. Oh, we do got him. Fantastic. Alex, how you doing?

[Jordi]

There he is.

[John]

Welcome to show guys.

[Jordi]

How are you? Great to see you. Great to see you.

[John]

Thank you and congratulations. But since it is your first time on the show, why don't you give us a little bit of the news? What happened?

[Jordi]

Intro first. Intro first.

[John]

Yeah.

[Alex]

Thank you guys for having me. I'm big fan of the show, excited to be here for the first time. So on Monday of last week, Long Lake announced that we intend to acquire American Express Global business travel for $6.3 billion. Long Lake is an acquisitive company that's bringing applied AI to services sectors globally. Prior to this, we'd acquired 30 businesses across various sectors of the services economy. And we've built a world class applied AI team, operations team, and an M and A team to help kind of bring AI to the real economy.

[John]

And yeah, there's 30 deals. What was the shape of them? Because this feels bigger than anything you've looked at previously. But is that roughly correct? Is this an order of magnitude bigger? Two orders of magnitude bigger, yeah.

[Alex]

This is definitely our largest deal so far. We have pretty big ambitions and we see our target market as really the entire services TAM, which is over 20 trillion in the US alone and, and much Larger globally.

[Jordi]

So I'd love to see that, I'd love to see that slide in the deck, by the way.

[Alex]

Well, you know, it's a great fit for us, this particular transaction. So it is our largest deal so far. But it's also probably, you know, every deal we've done has been high conviction, but this is very high conviction as to what we can do in terms of adding value for the customers, for the suppliers, for the entire ecosystem.

[John]

Yeah. What do you think makes the business special and durable? Obviously you're optimistic about the future of AI, but not so optimistic that people will just be prompting a self hosted LLM to do everything in their business. Travel, I imagine.

[Alex]

Yeah, that's right. So our vision is, and we talked about this in the press release, we basically want to give all the team members of MXGBT superpowers and particularly the travel counselors who are interfacing with the community clients. We basically have seen this in the 30 acquisitions we've done today. But I really does make, it does make sort of our human team members, you know, able to service customers better, able to provide faster response time, more, better accuracy, more products and services to the clients. And you know, we think that is going to drive better retention, better customer experience and better growth.

[Jordi]

3:30 acquisitions. How many months have you guys been in business?

[Alex]

Months. Let's see. I guess we started talking about the company, you know, roughly 28 months ago

[Jordi]

and started talking about the company.

[Alex]

I know, I guess we incorporated the company 28 months ago. We started talking about it maybe, maybe a few months before that. But yeah, we're roughly coming up on our two and a half year anniversary here soon.

[Jordi]

And obviously you've built out an incredible team with a lot of experience. But talk about, I guess building that muscle and that capability. I'm assuming you weren't. Were you buying one company a month roughly right away, or have you ramped up? What does that look like?

[Alex]

Yeah, so we tend to cluster in service verticals. So we started in residential services with HOA management, which we've talked about publicly. We made a lot of acquisitions in that space in partnership with our partners there, our operating leadership there. And we do tend to, you know, once we've sort of helped, you know, take, we have our Nexus applied AI platform, which is our proprietary platform that we've been investing in heavily for the last two and a half years. And once we sort of do the work to deploy Nexus into an industry, we find that each incremental acquisition, you know, makes that much more sense, right? We can basically integrate them more quickly into that platform, you know, help our team members become more productive, quickly improve the customer experience right away. And so we then tend to sort of pick up a pretty good cadence of acquisition. So I think roughly one a month is the number looking back. And you know, I would expect that to accelerate as we enter into, you know, additional service lines, I would think. Now some businesses obviously are more fragmented than others and there's more acquisition activity in some industries than others. But we do expect over time to be increasing our rate of acquisition.

[John]

How do you think about financial engineering in these deals? Is this sort of like the classic leverage buyout playbook or are you taking a different strategy or approach? How do you think about structuring all of these deals? Deals?

[Alex]

Yeah, we've traditionally been under levered, so our existing businesses have very little debt, almost no debt. We will be using financing as part of this acquisition. In the press release you can see J.P. morgan and others, but typically we can afford to be, you know, we're more growth oriented than traditional. We're investing in the products and services pretty heavily, especially in the early years as we sort of. We want every business that partners with us to have world class customer experience and technology. And that requires a multi year horizon. That's why we're set up as a permanent capital operating company and not as a fund. We see this as a long term strategy that requires upfront investment of time and energy and capital. So being under leveraged relative to some of our private equipeers is a big advantage, allows us to move faster. But over time, you know, this is a capital intensive strategy. So driving down our cost of capital, you know, this is when we start to think out in the future several years, we think hopefully Long Lake will go public. That will help our cost of equity and potentially help our cost of debt as well as we become a, you know, a public debt issuer.

[John]

So on the equity side, how is it, I think you've partnered with a number of venture capital firms. They have particular, they have a non permanent capital time horizon. How are you communicating with them, how they can participate while still benefiting their LPs? Is there overlap with VCs? LPs like how do you think about the timeline?

[Jordi]

Well, going public would be helpful there.

[John]

Yeah, I suppose. But is there anything that like, I guess like this, it feels like an incredibly exciting business. Very cool. I completely buy the pitch but there's a little bit of like, oh, this might be in like not every LP agreement or there might have had to be an extra conversation. I'm wondering if you can just give me more color around that conversation.

[Alex]

Well, you know, VCs tend to have longer hold periods in general. I mean VC is a power law business and when you have great companies, you obviously want to keep compounding with them for a long time. So I think our partners, you know, and there's a list of them in the press release, we have extraordinary partners and their, and their investors in turn, they really, you know, they kind of see the vision here and I think they do, they want to be partnered with us for the long term. I think many of their investments take 10 plus years to play out and that's obviously very different than the traditional three to five year private equity roadmap.

[John]

Yep.

[Alex]

So I think in general your starting point is much longer term in nature. And as you know, you know the public markets may solve this and providing everybody liquidity for our shareholder base over time. But even the private markets now have become very liquid and you know, there's a lot more sort of liquidity to be had even as a private company.

[John]

If I didn't, if I didn't know the label like service oriented business, like what, what financial KPI would I look to, to understand if a, if a company fits in that bucket?

[Alex]

Fits for, for Long Lake.

[John]

For Long Lake or just like a service oriented business broadly, is that particularly low capex or low revenue per employee? So it's highly leveraged to the operating expenses. What metrics are typically popping out at the businesses you look at relative to some super like arm, like super clean. I imagine that arm is the exact opposite. Right.

[Alex]

Well look, first of all this is the US is a services economy. So it's kind of like 80% of the businesses would fall in this category. But second of all, you know, what we look for really is business quality. That's kind of our orientation at Long Lake. So within the services sector we're looking for businesses that have many decades of established customer trust and high customer retention. You know, we typically on our businesses see 100% plus net dollar retention. And these are 10, 15, 20 plus year customer relationships typically across our portfolio. And you know, obviously mxgbt is over 11 year old business at this point, founded in 1915 to help American Express travelers check customers get out of Europe.

[John]

Yeah.

[Alex]

During World War I. And actually they bought a business called CWT Carlson Wagon Leet, which is actually over 150 years old. So these are, these are very, you know we were joking about this but in terms of managing Tech transformations, amex, GBT literally was created before the invention of the airline or around the time of the invention of the airline. So there's this new platform.

[Jordi]

We think it's going to be big. It's like, they're like birds, but you can, you can fly in them as a human.

[Alex]

Yeah, exactly. So in terms of managing text transformations, you know, these businesses have already managed, you know, many of them and. But yeah, so coming back to your question, I think what you typically see is even though these are really extraordinary businesses with incredible customer trust and decades or century plus of operating history, you know, the margin structures in these services businesses traditionally have been, you know, have been lower than software. And I think what we're seeing is a convergence basically of services and software characteristics over time where if you can make your team 20, 30, 40% more productive, which is what we're seeing in our existing 30 businesses, then that actually allows you to deliver more customer value, deliver more goods and services, different products and services to the customers, which allows you to sort of grow your revenue per employee over time and then you can grow much more easily and delivering more operating leverage as you scale, which is historically been what's more associated with software companies. And that's why software companies historically were so highly valued. And we see that trend as starting to, you know, now in the, in the services market in the next five to 10 years, we think will start to play out there as well.

[Jordi]

How do you, how do you think about your advantage of starting the business 28 months ago? Like you said, I imagine a lot of the other groups and firms that would be in the running to buy the same kind of companies that you are or trying to lean in and benefit from AI. They're dealing with these big portfolios full of companies that they bought without thinking about what would happen if the cost of producing software.

[John]

You're talking about older companies.

[Jordi]

Yeah, I was talking about too.

[John]

It's like a sweet spot story.

[Jordi]

Yeah, no, it is an incredible sweet spot where if you're, I won't name any names. Let's say you were buying SaaS companies for billions and billions of dollars, you know, over the last 20 years. You're now sitting there and you've got a bunch. You can't, you want to think about the future, but you're like, like, how do we, how do we exit all of these positions or in some cases, you know, turn them back to turn the cruise ship, private credit stuff?

[Alex]

Well, I think it is a big advantage to be purpose built. We have our entire focus is on our, you know, partner companies and our existing business. We didn't, didn't have any legacy portfolio to have to focus on. So being purpose built, that's one advantage. But the other big advantage is I think it's actually quite hard to do this. You really need to bring together a world class team across applied AI engineering, which Longlake was founded with. And our founding team actually was primarily applied AI engineers. And our co founder and cto, Rasmus Fissiman, who's world class and has built our whole team from the beginning for this purpose. And then on top of that you need sort of a really core function in change management and growth growth which we've also built out. And then of course M and A world class. M and A. And we've got folks that have joined us, you know, just, just to give you a flavor, folks from Palantir, Ram Glean, you know, Robinhood, etc. Many, many of our tech folks actually were founders before and you know, it turns out it's pretty hard to sell software into these industries and we have a dynamic of if you actually want to go and change these industries, it's easier to do it from, from the inside and actually, you know, partner with the companies themselves the way that we do here. And then on the finance side, folks, you know, from Blackstone, tpg, gtcr, hiv, some of the very best firms. And you know, I think part of what we've been able to do along with is by focusing on this core mission from day one. It's a pretty exciting mission which is basically bring AI to the real world and help drive the mythical AI GDP growth. Yeah, you know, that's what's been able to attract, bring people together.

[John]

Last question.

[Jordi]

The prophecy. Fulfill the prophecy.

[John]

The prophecy we were relying on Satya Nadella's prophecy of 10% GDP growth. Show me the numbers. Last question for me. Are you surprised that we haven't seen SaaS, companies that are getting sort of beaten up make a services acquisition? Or do you expect that that would change? Not that I want more competition in your sector, but it feels like, like there, there might be a thesis there is that misformed. Do we not expect that to happen for some structural reason or do you think it will maybe happen at some point?

[Alex]

You know, it's interesting. I wouldn't be surprised. I do think there's a convergence happening and, and whether it's services companies buying software or software, you know, buying services, it wouldn't surprise me. But I do think there's a distinct advantage in Being, you know, having a singular focus and being purpose built for our strategy.

[Jay]

Yeah.

[Alex]

You know, I think if you're an existing software company, you have your own set of vested interests around your existing customer base. And are you then competing with your customers? I think it could get a little tricky. Some people, I'm sure, will navigate that and find. Find great acquisitions to do, but I think we have a strong advantage in our, in our focus.

[John]

Amazing. Well, thank you so much for taking the time to come on the show.

[Jordi]

It's an honor to finally have you on the show.

[John]

It is.

[Jordi]

And let's make it a thing. Every time you maybe announce a new. Well, you, you like, once a month then. Yeah, once a month. But no, you like. I'm assuming you like to announce that you've been in a category after you're already done with said category, but you can just come on here to take victory laps, so.

[Alex]

Well, thank you, guys.

[John]

It's.

[Alex]

It's an honor to be here.

[John]

Thanks for having me.

[Jordi]

Great.

[John]

Have a great day.

[Jordi]

Cheers.

[John]

We'll talk to you later.

[Alex]

You too.

[John]

Bye, guys. Bye. Up next, we have Quaid from Basil. You know, you, we love him. He was one of the first TVPN sponsors, Good friend of ours. And here he is to break down the big news. How you doing, Quaid?

[Ferdinand]

Good, guys.

[John]

How you doing?

[Jordi]

What's happening?

[John]

Wait. Okay, quick question. Are you. Do you have the same name as your father, grandfather, and great grandfather?

[Quaid]

Do I have the same name? No.

[John]

The same first name? Because some Quaids are the fourth. So oftentimes if you have the same name as your father, you'll be known as Junior. And then if you have the same name as your father and your grandfather, you'll be known as a Trip. So if you ever meet somebody who's like, oh, my name's Trip, sometimes their name might be, like John iii, and some Quaid's apparently are the fourth. John. Like I'm John the fourth, but I go by Quaid. Anyway, that was a dumb question. Tell us about ap.

[Quaid]

Yeah, it's an interesting week right now. Obviously, I think everyone in the watch world or the watch world adjacent has heard about the collab with Swatch, and everyone's sitting around speculating and using AI to render examples of what they think it's going to be. And so we're all sitting, waiting until, I believe, the 16th to learn what the deal is.

[Jordi]

Yeah. So what is your prediction right now? Do you think it's going to be a plastic Royal oak? Do you think there's A wild card scenario where it's something entirely different.

[John]

So we watched a reveal video that looked like CGI of some gears coming together. But I guess that video didn't actually show us what the design is. Correct. So all of the colored royal oaks that I'm seeing that look like they're plastic, that's fake in AI. Is that right?

[Quaid]

Exactly. So I think clues that we have are they used the royal oak font. Like it's going to be something derivative of a royal oak. There's been the Swatch Pop, which is referenced in Swatch Pop historically as a model that is both a watch, but could also be popped into a lanyard of sorts. And then you saw a rendering from Swatch of a lanyard, like a little clip of some colored lanyards. So I think that's indicating that that's the direction they're moving. And then you saw some of the packaging in the boxes and then you saw the System 51 movement. And so what that indicates is just that it's going to be an automatic movement. The System51 movement is Swatch's movement. It's what's in the Blancpain collaboration. And the cool part about the movement is that it's theoretically like a fully disposable movement in the sense that it's completely 3D rendered and 3D printed. And so they don't do repairs on it. For example, it's more efficient for them to replace the entire movement. Okay, so It's a mechanical movement, 90, 90 hour power reserve. Like it has some impressive stats, but it's like very much swatches movement. And so what it looks like is happening is there's going to be some flavor of a royal oak in some watch slash lanyard device with an automatic movement. It's kind of all we know today. And then there's several colorways that are starting to come out.

[John]

Got it.

[Eric]

Yeah, yeah, yeah.

[John]

Can you quickly reset on the terminology? Because you just said, you know, movement automatic. Is there a battery? Is it quartz? Like do a little bit terminology for everyone.

[Quaid]

Yeah, so quartz would mean like it has a battery that runs an automatic movement would mean like it's a set of gears that are powering the watch. Typically, like in high horology these days, an automatic movement is indicative of like a, you know, a traditional wristwatch. The way the would think about it, there are a few quartz watches that trade really well in the secondary market, like a, you know, Jordan Elegant, for example. But largely like people are out here lusting for the automatic movement.

[John]

Automatic Movements.

[Quaid]

That's why it's interesting. They did that with the collab, with Blancpain, they went with the automatic movement and it's like moving a bit up market in that sense. And so they're, they're in that snapshot, they're basically saying like, we're doing the same thing here.

[John]

Yep. We were talking about cost. People have been speculating 300 to 50 to $500 and we were sort of going back and forth on like, if it is an automatic movement, even if it's 3D printed, it seems like that's not a dollar. Like, do you have any sort of benchmark for like, what something like this would even cost the two companies to make? Obviously the margins are great across all sectors of the watch economy.

[Jordi]

The cost and the price estimate. And we're going to come back to this, so you better be, you better nail it.

[John]

Yeah.

[Quaid]

I'm certainly not the guy to give you the breakdown there, but I will say, if you look at this, the Moonswatch launched, I think it was the $285 retail. That's a quartz example. Blancpain, I think they launched that in the four hundreds and that's theoretically the same movement that would be powering this. And so I think the speculation of somewhere in the 400s, the only interesting like morsel here that's, that's nuanced is obviously the two high horology brands they, they collabed with previously are like part of the Swatch Group.

[John]

Oh, yeah.

[Quaid]

And this is the only one that's external to the Swatch Group. And obviously like AP is in a bit of a different level from a like a rarefied air perspective. So I don't know how much like using that brand factors into the profit sharing, but it's super interesting. I don't know, it's like, I think a lot of people are torn because in many ways it's a fun, accessible moment to engage with a brand that's otherwise like the, you know, to get a base model Royal Oak today, I think is like $30,000 at retail and certainly more in the secondary market.

[Jordi]

Yeah. To me it's strategic because they are dealing with fakes. There's no desirable. The fake. There's a fake problem and then there's the fact that there's not a super desirable AP, in my view, under 30 grand. Right. Because nobody that's like, I don't know any, I don't know any. Like, you know, I don't have any friends that are like, oh, I'm just Really saving up for a code 1159. Like, I got. I gotta have it. Whereas I do know a lot of people that are, like, very excited that, you know, Also, like, with 10 point

[John]

with Patek, like, some people are like, yeah, I'll start with a dress. Watch a Calatrava. Like, I'm not that upset about that because it has a lineage, it has a story, and it's probably 3 to 5x cheaper than a Nautilus, and if it gets me on that track, I'm okay. But AP hasn't had that. Sorry.

[Jordi]

Yeah, so. So to me, I don't. By doing this, they're in. In some ways, like, I feel like counteracting the flood of fakes because. Because there's a lot of people out there that be like, well, I'm not going to get the Royal oak yet, but I'll get one of these AP Swatches if it does end up being a wristwatch. And I think that could be cool. And it provides an entry point into the brand. I don't think there's people out there that are like, well, I was going to get a stainless steel Royal Oak, but now I'm just going to get the swatch ap. Right. I don't think it cannibalizes them at all. In fact, like, a lot of people that already have a Royal Oak, a real one will be like, well, I'll get one of these to wear to the beach because, like, I maybe would. Would have worn a G shock or something like that. So I think it's pretty smart. But.

[John]

But what do you think?

[Jordi]

Wait, that said, I text you this

[John]

morning and say it's over, I think

[Quaid]

it comes down to how much, you know, it devalues the ownership of the $30,000 plus Royal Oak. Right. I think, like, the pro side argument is that, to your point, Jordi, it's an interesting entry point. It allows people to kind of aspirationally engage with the product before they can buy the product. I think the con is, if you see a bunch of people wearing a $400 example of the watch that you spent $30,000 for, does it in some way detract from the ownership that you have? There's a lot of these arguments on the Internet of, like, you don't see Ferrari out here collaborating with Toyota to make a can. There's a lot of those commentaries.

[Jordi]

Yeah, but another. Another, I guess something I go to is, like, if a Porsche owner pulls up to grab a coffee on a Sunday morning in a GT3RS and they see someone With a Carrera T. They're not sitting there like, oh, that Carrera T is devaluing my GT3Rs.

[John]

They're thinking, mogged.

[Matt]

Damn.

[Quaid]

That's the equivalent of shout. Someone pulling up with, you know, an open work ceramic royal oak, and then someone's walking in with a 15, 450, 37 millimeter starter Royal Oak. Right. Like, I think you're still in that same realm. This would be like, you know, if you show up in your, you know, GT3 touring and someone else pulls up with the Toyota collab.

[Jordi]

With a badge. No, just a Camry. With the badge.

[John]

Yeah, with the badge.

[Quaid]

Yeah, exactly.

[John]

Yeah.

[Jordi]

Even the chat says they should. Toyota makes a good car. I agree. I agree. I want the Porsche badge byd.

[John]

Yeah. No, the real. The real move is down badging. Get the Carrera gt, throw the Boxster on the back, See if anyone. Anyone notices. Are you noticing any movement on bezel yet? Any early signs of weakness in the traditional AP or Royal oak market, or just an increase in listings even?

[Quaid]

It's an interesting time because I haven't seen a response to this yet other than, like, a lot of people asking us questions, and a lot of people, like, want access to that. I think the same thing happened when the Moonswatch came out. Like, we had everything from, like, you know, professional athletes to regular people asking for, like, big boxes of these moon swatches, and we don't traditionally sell them. So we did some addition concierge stuff there. It was an interesting time, though, where I think there's a funny thing happening in the royal oak market generally right now where there's a lot of really cool discontinued examples that are available that are trending kind of at retail or less than retail. And so if you look back on the Royal Oak catalog, there's like, you can get a 15, 300, it's a 39 millimeter. Oftentimes argued better size for in the low 30s, right about where retail is, you can get 15,000, 415, 500, and now you're at the 15, 5, 10. Those examples trade above retail. There's a lot of them that are trading at retail or around. And synthetically, they are kind of. You're getting a royal oak out of that offer. And so we're seeing a lot of people buy Royal oaks and getting great deals on them right now in market. And so it'll be really interesting to see if this release generally just elevates all Royal Oaks. And it's just hype in the market, and everyone wants them or if it does the inverse where you start to realize like maybe I don't need to wait on this wait list for this thing that I'm lusting for. I'll buy this watch. And now it opens my mind to like you know, maybe I'll buy the older example for $28,000 versus waiting for the new one for 33 or whatever that is.

[John]

Well what else is new in the watch world? What's the next event on the calendar that everyone has their eyes towards?

[Quaid]

I think the next big one is Geneva Watch days is in September so that's a big fun one. But I think everyone's still reeling from watches and wonders that still happened.

[Jordi]

Quite a few who won.

[Matt]

Oh yeah, I don't know if anyone won.

[Quaid]

I think there's a lot of great examples. Come on.

[Jordi]

The salmon. The salmon ultra thin overseas.

[Quaid]

Yeah, I would say big fan of the over season salmon. I'm a sucker for a salmon dial. Big fan of the kind of 38 millimeter nautilus. But I think there's been sneaky winners. I think the UN Super Freak was incredible and being there in person and checking all of it out was really awesome. A lot of cool releases and it was super fun being there. So just another nothing like wow. I didn't expect this but just a lot of really great stuff that makes me excited to buy and sell watches.

[John]

Fantastic.

[Jordi]

Amazing.

[John]

Well, thank you so much for coming on the show.

[Jordi]

Thank you, thank you for the intel. Always good to excited to see the launch. Are you going to be camping out at any swatch stores this weekend or you got better things to do?

[Quaid]

I will not be doing that unfortunately but I look forward to getting the coverage of it and seeing. I'm sure we will be placing some examples into some clients hands as soon as it pops up. It'll probably be very desirable in the very beginning.

[John]

Fantastic. Well thank you so much. Have a great week. We'll talk to you soon.

[Quaid]

Goodbye.

[John]

We can pull up this post from Simplifying Stocks. We got another chart. Maybe a chart crime. We'll decide. We'll put Tyler on the case. People are constantly trying to map this boom to the dot com boom. Does it look exactly like it Simplifying Stocks? Certainly seems like it does match up perfectly. It feels like 1999. Yes it does. They took the 2026 stock market overlaid it. It looks perfect. It looks like we're due for a crazy, crazy breakout. What will happen? I don't think anybody knows but we'll let you decide. If you benchmark and fit the graph and change the y axis and the x axis perfectly. You got the perfect pattern. The chartologists and the chatter going wild. Anyway, we'll have to dig.

[Jordi]

We're going to find out where we are exactly from here.

[John]

I do, I do think I would predict that the market's either going to go up or down over the next couple of years. One of those two outcomes for sure.

[Jordi]

I think a 50% chance.

[John]

50, 50 up.

[Jordi]

It goes up.

[John]

50 up, 50 down.

[Jordi]

I don't want to be too. I don't want to, I don't want to.

[John]

Historically it's gone up more than it's gone down and so you should actually be like 51% up or 52% up if you want to be historically accurate. Anyway, thank you for tuning in. Have a great day. Leave us five stars on Apple Podcasts and Spotify. Sign up for our newsletter tvpn.com goodbye.