20VC: Chime IPO: The Breakdown | Why Fund Returners Are Not Enough & Seed is for Suckers | Are IPOs Dead & The Future of the Late Stage Private Market | Rippling vs. Deel Lawsuit: WTF Happens Now?

Summary

Podcast Summary: The Twenty Minute VC (20VC) – Episode on Chime IPO and Late-Stage Market Dynamics

Release Date: May 22, 2025

In this episode of The Twenty Minute VC (20VC), host Harry Stebbings engages in a deep dive with esteemed venture capitalists Rory O'Driscoll and Jason Lemkin. The discussion centers around the recent Chime IPO, the dynamics of late-stage venture funding, the role of fund returners, and the evolving landscape of IPOs and private markets. Additionally, the hosts touch upon the ongoing lawsuit between Rippling and Deel, providing valuable insights into legal challenges in the startup ecosystem.

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1. Chime's IPO and Valuation

Key Discussion Points:

• Chime's Financials and Growth: Chime has reported impressive metrics with 8.6 million active users, two-thirds of whom use Chime as their primary account. The company achieved a revenue of $1.67 billion in 2024, growing at a robust 30% rate.

• IPO Timing and Market Conditions:
  Jason Lemkin remarks on the volatile market conditions, stating, "It's been the weirdest market ever... [Chime] dropped their S1 when the market was receptive, showing shrewd timing" [05:13].

• Valuation Challenges:
  The last private round valued Chime at $25 billion, but public estimates suggest a valuation drop to $7-8 billion. Lemkin explains the implications of such a decrease, emphasizing the impact on both the company and its investors:
  “If you end up plus or minus $10 billion, you’re looking at a deal going public 50-55% below the last round price” [10:00].

Notable Quote:

• Jason Lemkin on market resilience:
  “This is the fastest bounce back in the last 20 or 30 years... Everything’s back” [05:07].

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2. Fund Returners vs. Seed Stage Investments

Key Discussion Points:

• Fund Returners' Limitations:
  Rory O'Driscoll critiques the reliance on fund returners, suggesting that merely returning the fund is insufficient for meaningful venture success:
  “A fund returner is not enough, man. We don’t get out of bed for a fund returner” [00:15].

• Economic Realities of Venture Capital:
  Lemkin highlights the high-stakes nature of venture investing, noting that significant returns are typically realized infrequently:
  “We make an embarrassingly large percentage of our money once every seven years” [00:25].

Notable Quote:

• Rory O'Driscoll on investment committee challenges:
  “I would be a billionaire, but I couldn’t get it past my investment committee” [09:32].

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3. Future of IPOs and Late-Stage Private Markets

Key Discussion Points:

• IPO as a Strategic Exit:
  The conversation explores whether the current market conditions favor more companies choosing to go public. Lemkin suggests that while IPOs offer liquidity, they may not be the optimal choice for all companies, especially those with access to cheap private capital:
  “If you have the sex appeal of OpenAI, then you can raise cheap private capital” [20:25].

• Market Dynamics Influencing IPO Decisions:
  The hosts discuss factors such as company size, growth rates, and industry-specific needs that influence the decision to pursue an IPO or seek alternative funding avenues.

Notable Quote:

• Rory O'Driscoll reflecting on LP sentiments:
  “When LPs are saying that, it may trickle down to the CEOs” [23:11].

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4. Rippling vs. Deel Lawsuit

Key Discussion Points:

• Legal Battle Overview:
  The lawsuit between Rippling and Deel revolves around allegations of trade secret theft. Both Lemkin and O'Driscoll express confidence in Rippling's position, anticipating a settlement or Rippling's victory.

• Implications for Startups:
  The discussion underscores the importance of handling litigation pragmatically to avoid prolonged legal battles that can drain resources and tarnish reputations.

Notable Quote:

• Jason Lemkin on litigation strategy:
  “If I was the CEO of Deal, I’d want to settle and bury it deep” [53:00].

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5. Exit Values and VC Returns

Key Discussion Points:

• Analysis of Exit Value Growth:
  The hosts examine trends in exit values, noting significant growth in the top percentile exits over the years. Lemkin emphasizes the power law distribution in venture returns, where a small number of high-performing investments drive overall fund success.

• Strategies for Maximizing Returns:
  Strategies such as portfolio diversification and identifying potential "SpaceX-like" companies that can yield exponential returns are discussed as vital for achieving superior fund performance.

Notable Quote:

• Jason Lemkin on venture fund realities:
  “We make an embarrassingly large percentage of our money once every seven years” [00:25].

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6. Impact of AI on Businesses and Software

Key Discussion Points:

• AI as a Disruptive Force:
  The conversation delves into how AI is transforming various sectors, including sales automation, customer relationship management, and note-taking applications. The hosts discuss both the opportunities and challenges AI presents for existing businesses.

• Defensibility in the Age of AI:
  Lemkin and O'Driscoll discuss the importance of building defensible businesses that can adapt to AI-driven changes, highlighting companies like Gong that have successfully integrated AI into their growth strategies.

Notable Quote:

• Rory O'Driscoll on AI replacing roles:
  “Everyone recognized 20 to 30% of their team is going to be replaced with AI and they're happy for it” [60:03].

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7. Legal Insights and Litigation Strategies

Key Discussion Points:

• Handling Counterclaims:
  The hosts provide insights into effective litigation strategies, particularly the use of counterclaims as a tactic to offset initial claims. O'Driscoll emphasizes that counterclaims often indicate a weak position by the opposing party.

• Emotional Detachment in Legal Battles:
  The importance of maintaining objectivity and avoiding emotional investment in litigation is discussed, with Lemkin advising CEOs to prioritize settlement over prolonged legal disputes to safeguard their companies and personal well-being.

Notable Quote:

• Rory O'Driscoll on counterclaims:
  “If you have a decent, you have to have a team that's going to run fast” [55:14].

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8. Audience Predictions Segment

Key Predictions:

1. OpenAI's Nonprofit Status:

   • Question: Will OpenAI stop being a nonprofit?
   • Rory's Bet: No, he believes the nonprofit structure will persist due to power dynamics within the organization.
   • Jason's Bet: Yes, he anticipates OpenAI transitioning to a public benefit corporation (PBC) to access broader funding and scalability.

2. ChatGPT-5 Reveal:

   • Question: Will ChatGPT-5 be revealed this year?
   • Rory's Bet: Unlikely, expecting delays.
   • Harry's Input: Expresses optimism for a potential reveal.
   • Jason's Bet: Yes, confident in its imminent release.

3. Rippling vs. Deel Lawsuit Outcome:

   • Question: Will Rippling beat Deel in the lawsuit 100%?
   • Rory's Bet: Certainly, citing strong evidence against Deel.
   • Jason's Bet: Agrees, expecting a settlement favoring Rippling.

Notable Exchanges:

• On OpenAI's Structure:
  Jason Lemkin confidently states, “I bet yes on that one because there's no timing” [46:12].

• On the Rippling vs. Deel Case:
  Rory O'Driscoll asserts, “They stole trade secrets. This is a classic case. They're gonna lose” [49:47].

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9. Insights from the Sasta Event

Key Discussion Points:

• Event Atmosphere and Focus on AI:
  Rory O'Driscoll reflects on the heightened energy and focus on AI at the recent Sasta event, highlighting shifts away from past business models towards AI-driven growth.

• Strategic Positioning for SaaS Companies:
  Lemkin praises the event's strategy of emphasizing forward-thinking AI applications, suggesting it sets the stage for sustained growth and innovation in the SaaS sector.

Notable Quote:

• Rory O'Driscoll on Sasta's energy:
  “There was literally 50 times more energy at Saster this year than last year” [57:27].

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10. Final Thoughts and Closing Remarks

Harry Stebbings concludes the episode by expressing gratitude towards the guests and teasing the next episode featuring the head of growth at Elevenlab. The importance of adapting to the evolving venture landscape, embracing AI advancements, and making strategic exit decisions remains a recurring theme throughout the discussion.

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Conclusion: This episode of The Twenty Minute VC offers a comprehensive exploration of the current venture capital landscape, emphasizing the strategic considerations surrounding IPOs, late-stage funding, and the transformative impact of AI on businesses. With expert insights from Rory O'Driscoll and Jason Lemkin, listeners gain valuable perspectives on navigating the challenges and opportunities within the startup ecosystem.

Notable Quotes:

• Jason Lemkin on settlement mindset:
  “If I was the CEO of Deal, I’d be like, how much money does it take to settle this thing by Friday?” [54:58].

• Rory O'Driscoll on portfolio strategy:
  “At 2 billion, sell unless you're 100% sure you shouldn't as a seed manager” [36:41].

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For more episodes and resources, visit www.20vc.com.

Transcript

[Jason Lemkin]

Suddenly we've drifted into some kind of theft of trade properties and suddenly someone opens an investigation, then you're fucked. If I was, my ass was on the line and I was the CEO of Deal, I'd be like, how much money does it take to settle this thing by Friday?

[Rory O'Driscoll]

A fund return is not enough, man. We don't get out of bed for a fund returner. A fund returner just returns the fund. Like everyone talks in venture about fund returners. Like, they're so great. I don't think they're so great.

[Jason Lemkin]

We one of the pressing facts about venture is we make an embarrassingly large percentage of our money once every seven years. When you're in the white heat of must acquire must own high growth venture assets.

[Harry Stebbings]

You are listening to 20 VC with me, Harry Stebbings. Now this is my favorite show of the week. We are back, Rory o' Driscoll, Jason Lemkin and me discussing the hottest topics of today. What is on the cards today? We have chimes, IPO, we have venturexs and their value increasing exponentially. What that means for LPs, means for GPS, and so much more. I love doing this show. Let me know what you think. You can find me on Twitter at Harry Stebbings. I want to know how we can make it better for you. But before we dive in Today, here are two fun facts about our newest brand sponsor, Kajabi. First, their customers just crossed a collective $8 billion in total revenue.

[Rory O'Driscoll]

Wow.

[Harry Stebbings]

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[Jason Lemkin]

You have now arrived at your destination, chaps.

[Alex]

It is the highlight of my week. Everyone know my mother listens to this show and she's like, I can visibly tell your tone is more excited. You should like change that. And I was. I think we're past that after this amount of time. Jules. This is Good news, guys.

[Harry Stebbings]

IPOs, baby. This is liquidity.

[Alex]

Thank the Lord. So Chime announced What? Drop their S1. I thought it was super interesting. 8.6 million active users. This one astounded me. Two thirds of users have Chime as a primary account. Two thirds. That's amazing in my eyes. 1.67 billion, 20, 24 revenues.

[Rory O'Driscoll]

Why are they IPO now? Right. Unless you have inside information. That's to me, that's the number one discussion.

[Jason Lemkin]

Despite the craziness of the last month and a half, we're only 3% off our all time high. This has been the weirdest market ever. You know, we were doing great then we, you know, plummeted a little bit in March, but really in April, but we've bounced. This is the fastest bounce back in the last 20 or 30 years. So we're up like 17, 18% in a matter of two or three weeks. So we're within, yeah, spitting distance of our all time high and up on the year. So what it says is two months ago it was like, oh, everything's doomed. I'll say a month ago everything was doomed. Now everything's back. What it just shows is when policy changes that quickly, you really can't triangulate on that. I think they were smart. They had their S1 on file. And what they said is somewhere between we filed privately and today, weird shit happened, but it appears to be over, proceed as normal. I think they're exactly right. Is that in today's market, I mean, it's one of the weirdest statements ever. In today's market, you'll clearly get this done. In February's market, you'll clearly get this done. Oh, and in between, for about a month, things went to hell in a handbasket. But moving right along, nothing to see here now. So that's why they dropped it. I think they get points for being shrewd, keeping it on file, keeping it updated. And now in this market, they're ready to roll. And I think it's a great company. Look, it's clearly going to get done. It's a $1.7 billion trailing revenue company growing 30%. We'll talk about valuation in a second. It's basically comes off two big ideas. The first is that in the world of the Internet, you can give people a bank account so cost effectively that you can offer a very different product than the large US banks. You don't have to ding overdraft fees, you don't have to nickel and dime them on kind of monthly fees. You can make all your money on pretty much 75% of your money on basically debit card fees, which is a relatively small part of most banking revenue streams. It's a great idea. And the reason it works is, duh, the Internet. No branches, no people in branches. You know, they make 250 bucks per client per year and they can build a profitable business on that. I don't think a JP Morgan or a Chase would be able to do so if all they were selling was just debit card transactions. So that's the positive part of it. And they can add over the next few years they're going to add, you know, loans which they don't really do a lot of today and all the other cross sell stuff that every financial services company does at scale. So you can look one way and say there's a whole bunch of upside from here because if you're making 250 bucks off a customer today, even if that's a middle income customer with sub 100k revenue, they're going to have other financial needs and you're going to be able to sell to them. That's the upside story. It is worth pointing out the minor negative on the story is a huge amount of this is Durbin amendment arbitrage which is a very arcane rule that really matters in I think 09 after the great financial crash they were putting through a regulation package and there's a rule that says if you are a bank more than $10 billion in assets you can only charge approximately the devil's in the details but approximately 50bps on a debit card. If you are a sub $10 billion bank you can charge more and the effective rate is typically about 1.2% so you get more transactions when two people go into the same shop and buy something on the debit card. If one's from JP Morgan, the firm has to pay, the shop has to pay 50bps and if the other is from LittleBank Co, they all have to pay 1.2%. The economics of a debit card business to a small bank are much more compelling. Chime itself is not a bank but they cleverly obviously team with a lot of these small sub $10 billion deposit banks and as a result of that their revenue stream, which is 75% of their total money comes from a product where they have this umbrella effect from that legislation. Obviously if that were to change that would impact the economics. No sign of it happening right now but I gotta believe if you're Jamie Dimon, you wake up every morning spitting mad that these dudes are able to take your customers because you're not allowed to charge what they can charge for exactly the same product. I mean that's the only minor negative in the thing. Otherwise it's a great company, it's growing nicely 30% plus they've executed on a very consistent plan for 10 or 12 years and kind of go team. We can talk valuation in a second. But like the company a lot wish we did the round we looked at and all congrats to them.

[Alex]

What round did you look at?

[Jason Lemkin]

Oh, way back. Way back. I can't even remember.

[Alex]

It was like, I heard that you wanted to do it but your partners didn't.

[Harry Stebbings]

You were all in and they were like, no.

[Alex]

But you were.

[Harry Stebbings]

Yes.

[Jason Lemkin]

Partnerships stick together, Harry.

[Rory O'Driscoll]

I love those, those tweets. I would be a billionaire, but I couldn't get it past my investment committee. But I was all in. I was all in on the deal and the founders wanted me. Right? They don't. We already had a handshake deal.

[Jason Lemkin]

But let's move on from that. It's not that interesting. Let's talk about valuation, which is more interesting?

[Alex]

Yeah, I agree. The loss, like.

[Rory O'Driscoll]

Well, if not to interrupt, Harry, it's your show, but if it's not interest, I think it's interesting. If it's not interesting that chimes IPOing, then shouldn't every every everyone chime or better IPO now? Because we've talked about the incentives to not IPO, right. For founders to do infinite secondaries and do it, but if the markets are wide open. Figma's out. CHIMES out Is it. Is it time for folks to grow up? Should everybody IPO now? And will they?

[Jason Lemkin]

Because I'll tell you, I'm going to override you because I didn't say. I said talking about internals decisions on deals, not deals, wasn't interesting. I actually think I'm going to hold question because I actually think the natural order of it is we should talk a little bit about the valuation, which will segue us perfectly to talking about how other people should respond here. Because obviously the big question here is valuation. The last private round these guys did was at 25 billion. Information estimates of a valuation of 7 or 8 billion. I think that's low, but I think if you end up plus or minus 10 billion, rough order of magnitude here you are looking at a deal going public 50, 55% below the last round price. That's just a fact. And you have to talk about what does that mean? How does that work for the specific company and then what does it mean? Jason, to your point, for other companies.

[Rory O'Driscoll]

Going public, can I ask a question here? Because I'm just ignorant. So, okay, if Sequoia Capital Global equities, which I don't think is the Early Stage Fund at Sequoia based on the title. Right. But if they did the round at 25 billion, is this a huge loss for Sequoia? Is it like an SPV or separate entity? Is it a small piece of the fund? Or if it goes out at 10 billion, which is epic in absolute terms. Right, But Sequoia did it at 25. What does that. Maybe Harry knows too, but I honestly don't know. What does that mean at the fun level?

[Alex]

Well, just to just be clear, besides.

[Rory O'Driscoll]

Not being a win, right into Jeff.

[Alex]

Wang, who is the head of it, and he's left now, but essentially he left. Well, he left a while ago because.

[Rory O'Driscoll]

It'S such a great job. It was such a great job. He'd be there today.

[Alex]

People, I love Jeff, but essentially it's their super late stage, borderline pre ipo, slash post ipo. Generally speaking, honestly, they've done phenomenally well. But it's a completely separate vehicle run by a separate team.

[Jason Lemkin]

This is the question that I was interested in. So I have more detail. It boils down to only one issue. What are the terms of the mandatory conversion, the articles of incorporation, in other words, this is. We sometimes reference the fact that in an M and A, even if you quote, overpay and you. If this company sold in an M and A situation, even if you paid 25 billion pre, if you have liquidation preference, you would get 1x your money back. The question is what's the equivalent term to that in an ipo? And there is an equivalent term. It's the mandatory conversion term. It boils down to the following question. In a quote qualifying ipo, which is your IPO above a certain size and scale, which of course this will be, is there price protection for the $25 billion round such that the price adjusts down either fully or partially to the IPO price or not. Is that term in there or not? I went to the S1, it wasn't clear, but you can actually get the articles of incorporation, which is where it will be. I ran out of time. I'm actually very interested in that. Because if you think about this late stage business, there's only one thing that can go wrong in a late stage company. 99% of them won't blow up. And the only risk you're running is the risk that you overpay. And if you can negotiate a term that effectively says, hey dude, if I overpay, you got to give me more shares such that I didn't overpay, then it's the world's best business. There's only one thing that you can go wrong and now it can't go wrong anymore. So it will be really interesting to see did these guys on this deal. And just in general, Jason, to your wider point on all these deals, what are the terms of the late stage company later stage rounds in terms of IPO protections and blocking rights?

[Alex]

So the one thing I do know is I know the General Atlantic team very well who also were part of this round. They also took part in the Sheehan round and laded at $100 billion. And I know that they are incredibly diligent around putting those protections in place in the case of a mispricing happening like a Sheehan, which is not hitting the 100 billion price that it was paid.

[Jason Lemkin]

Yes, and we'll find out because before you file the final S1, it'll be very clear because let's say it starts to be priced in the 10:12 range, then as part of the S1 they're going to have to disclose the adjustment, quantify the adjustment. It'll all be there at the end. The great thing about S1s and going public is all the facts come out because otherwise the CFO goes to prison and we'll know exactly how many shares get issued. And look, if these guys have full protection, then that's a win. And an interesting lesson for the founder. You didn't raise money at 25 billion. You thought you raised money at 25 billion, but in fact if you go public at 12, you raised money at 12 and you just didn't know it.

[Alex]

The more I listen, the more I just think Jason's right that seed is for suckers. You can overpay by double and still get your 1x protected with a shortened time to liquidity and more money at work. Seed is for suckers.

[Rory O'Driscoll]

Well, you know, not only is it for suckers, but I know like a lot of seed folks that have all these great opinions and how safes are terrible and everything's terrible. I don't think ratchets for a late stage dealer. So such a bad deal. I don't think it's a big deal. Listen, obviously if you're an early stage investor before that you'd prefer there not be a ratchet or an adjustment. Let's be like we can't argue with that. But if you need the money and you're split like people get too emotional, you're splitting the difference. Okay, so Sequoia and Softbank and Tiger and Dragon are coming at 25 billion. If you're worth north of 25. You win, right? You won the bet. You won the bet. If chime ends up at 10 and let's say it's a full ratchet and they're ratcheted down to 10 billion, but maybe they probably only bought 3% of the company. So you have 3% dilution because you lost the bet, but you still won the bet because you got the money. I don't know why people get so emotional about these ratchets. And I get why they're toxic early stage. But these are just seed investors who are grumpy. That seeds a sucker bet, including me. But I'm not grumpy about it anymore. I just signed the documents. I don't even read them anymore because it don't matter what's in them. I just sign them and it doesn't matter what I think.

[Jason Lemkin]

I gotta say, I find myself astonished at agreeing with you again, but you're exactly right, is that I've been through the drama of one of these. You know, we gave a late stage ratchet and then you're pricing the ipo and then everyone all gets bent out of shape. And I can't remember there was one IPO recently that had one where you know, people are writing the oh my God, they have to go public because of the ratchet.

[Alex]

Service titan.

[Jason Lemkin]

Service titan. And I ran the numbers. The truth is, Jason's exactly right. You gave away 3% of the company in a round. Let's just say you were wrong by 50%. So you gave away six, not three. It sucks. I'd prefer to have 100% of my position, not 97% of my position. But it's not the end of the world. It's an economic term. It's not an emotional thing, provided it's not out of control. It's survivable. Now, as I say, it does mean that on the other side of the table, they have a wildly attractive business because we've just agreed they lick preference. And ma, they get full price protection in an IPO. And by the way, it's priced at the IPO price. So the IPO Pop puts them back up 30% the same day. That's the. By the way, a little comment. It doesn't matter. But that's the little bit that will rub you as the CEO. Let me get this straight. They paid 25 billion. It's being marked down to 10 billion. So I'm giving them an extra 3%. And then when my share opens in two hours time and it pops 30%, they're going to be up 30% on that recollected price.

[Rory O'Driscoll]

Whoa, that sucks for sure. But they made this investment in 2021. What's the IRR on this deal? Not so great, right?

[Jason Lemkin]

Agreed. But that's the point.

[Rory O'Driscoll]

If they have full ratchet, like we get so religious. Even if they get a 30% pop and they distribute by 2027, that's six years to having a modest return, right?

[Jason Lemkin]

No, you're exactly right. Totally agree. The risk you're running on these kind of transactions is primarily IRR risk, not loser capital risk. In the business you're in, you know, you have a substantial risk of loss of capital. My guess is, yeah, it's 60% plus at our stage. You know, 30, 35% of our deals don't work out at the stage These guys are at most of their deals. 90% plus of their deals, when you're writing those kind of checks, should be a 1x/ IPO puff. They're not running the getting it all wrong risk. What they are running, to your point, Jason, is the, oh my God, we were four years too early and our IRR is going to be pitiful.

[Alex]

When do you think you transition to an IRR risk game? For us, we don't play the IRR risk game really, so to speak. I don't think. When does that become crucial?

[Jason Lemkin]

I mean, it's hard to answer that question. I think there's a size. I remember realizing when you watch the late stage hedge fund guys come in that they fundamentally run their entire life on irr. They have yearly high watermarks, compensation schemes. Therefore they're competing for a deal and they're not saying to themselves, I need a 2x or a 3x. They literally use different language. They say, I want to return a 30% a year. You definitely see that on the late stage, on the hedge fund guys crossing over. So it's probably at those kind of three or four years before the ipo. When it's that kind of money, when the alternative use of your capital is public stocks, baby.

[Alex]

When we look at this price, that it could go out at being significantly lower that we all said. Going to Jason's question, does this mean that everyone should ipo? Now's the time its markets are receptive, Bite the bullet and go.

[Jason Lemkin]

I think more people should. I mean, it's worth pointing out this is still a $1.7 billion revenue company. It'll probably be larger than 80% of the companies that are unicorns that have been maybe 90% of the companies that are being talked about for IPO. So it's not like this is a mid tier marginal play. This is a top of the line revenue scale company. I'm not going back to this and saying I have a company doing $200 million in revenues. Chime went public, the window's open guys, let's get ready. These things happen incrementally over time. I think there's a bunch of other later stage companies who now clearly have at the very minimum a choice. I could easily go public, do I want to or not. And that set of decisions is, let's call them the billion plus revenue guys. Right. Interestingly, some of them, even if the window's open, are choosing not to. There is the SpaceX, the Stripes. They're literally not what we're doing right now. Thank you very. And then there's others. Klarna, another example at that scale where I think they are saying let's push for the line and get the capital and go for it. Oddly enough, both decisions make sense. If you're a Klarna, if you're a financial player where access to capital is really important, you are fundamentally a lender. I think being public and having access to money in all its different ways makes sense. If you're a high growth AI company or something like Stripe, you have infinite private capital at dirt cheap rates. Why would you bother?

[Alex]

Is that not fundamentally it Respectfully, your Klarners and your chimes of the world respectfully cannot raise infinite amounts of capital at good terms from the private markets. Stripe, databricks, anthropic, OpenAI can. That's why those go public and the others don't.

[Rory O'Driscoll]

Yeah, I mean Klarna just said their growth substantially decelerated. They just published their numbers, right?

[Alex]

No, my partner Paul did an analysis on it. It's 13%. He's a phenomenal analyst. 13% growth. The cost of borrowing is way up.

[Jason Lemkin]

If Klarna was doing well, and broadly speaking I think it is doing well, they should go public much sooner than OpenAI or Stripe because I just think they need to have access to continuous capital. They're a lender at scale, they're not a cash flow machine. They just probably have more financing alternatives. As a public company, I think it's more appropriate for financial services company like that to be public than say an OpenAI or Tropic. And you're right, there is more cheaper capital available to. Even if Klarna were, let's say, growing at 20% like Chime or 26% like Chime, there are more Options for cheap private capital. If you've got the sex appeal of OpenAI than if you don't have the sex appeal of what is buy now, pay later. One of them just has more intrinsic ability to raise cheap private capital. I think the interesting thing to Jason's point is most companies are more like Klarna than OpenAI. No surprise. Most companies aren't singularities. And I do think as the window opens, you will see the people doing a billion in revenue, then a half or three quarters of a billion in revenue and half a billion in revenue, thinking, maybe I should do this. Every one of them is going to have to wrestle with their version of did I give away price protection? Did I raise at a high price? Am I willing to take that kind of hit in the public markets? But I think if the window stays open, I think more of them will start to investigate this and should listen.

[Rory O'Driscoll]

You've said this a million times, Harry. To me, it was just. I was at EF's demo day a couple weeks back in the US and I saw one of my LPs there who had retired, but one of the best foundation, like, you know, all the LPs. I don't. Okay. I have the same LP piece since inception. Never added one. Don't plan to. Okay. But this guy's legendary in the industry, okay. And he just retired. So he had no axe to grind, right? Or no game. He's like. And he went through all my portfolio and others. He's like, these guys just got to sell or go ipo. It's just time. So. And this is someone who pioneered a lot of this going long doesn't, you know. So when I feel that vibe check, I think it's got to water down or cascade down to the gps, which has got to cascade down to the portfolio company companies. Should I keep rolling the dice on anything sub OpenAI or not? And so if the LPs are saying that for a variety of reasons, right, Then the GPS won't keep tripling down, right? And they will suggest ipoing. And it may be subtle, but when I hear that from like one of the top 10 LPs of all time, that may push the pressured IPO too. It may trickle down to the CEOs.

[Alex]

I mean, he's about to tell me that my question is stupid Jason. So he's going to reshape it in a minute. But you said they're like seller ipo. Well, Thoma Bravo are saying Orlando Bravo is saying a cold, quiet year for M and A. And Then we're looking at also like Convergence, a company that's less than a year old in London selling for nine figures to Salesforce and seeing more and more M and A. I'm just confused. How do you guys think about those two opposing truths?

[Jason Lemkin]

People's prognostications of what's going to happen in the future are pretty worthless, including mine, to be clear. Right. All you can say is what is happening right now? What's happening right now is Salesforce bought a small interesting AI company because they want to be in AI. Duh. No surprise. There'll be a whole ton of these over the next two to three years as these large software companies listen to Jason telling them they're screwed on this podcast and decide, I don't want to be screwed, I want to be a contender. Right? And the best way to be a contender is to pick up some of these small acquisitions and fit them into your product. So that's clearly a trend that is happening. So a fact based statement, much bigger one Moveworks and it'll probably continue to happen. Totally separate trend. What are Thoma Bravo and people like that making of software roll ups? And are they going to buy a whole bunch of venture backed portfolio companies? And as you know, we've talked about this before. I don't think they are. I think they've got a fair amount of indigestion from the stuff they already have. And I don't think the companies that Venture makes are naturally great candidate for PE purchase as much as people think. So. Well, his statement could be correct too.

[Rory O'Driscoll]

Yeah, I'll say that the P bummer still hangs over all of this. This cloud. That he doesn't want to buy all of our portfolio companies is a big bummer. It is a big bummer on this convergence thing. I'll tell you my view of what he said. This is from my tiny lens, right? I've had two portfolio companies recently that got offers to buy them at 500 million. Okay? Now in isolation that sounds great, but these are very good companies, okay? This is not OpenAI. These are very good companies. One was just a smidge above the last round and one was a smidge below the last round. And what I mean from the Orlando thing is, listen, this sounds good, but these are tech leaders who want to make AI adjacent deals, okay? But they don't care about, they're not willing to go all in. Okay? Now maybe in six months those deals would be a billion and they both would have cleared it a billion. But they both said no. And the Companies just walked and one of them bought a company instead for just under 100 million because it was just easier. Instead they bought someone at 2 million for 100 million. Great deal for the founders, Right? Right. Raised a seed round, but they walked from buying a leader because 500 was the limit. Right. And they're all can afford infinity. Right. In this case for all intensive purposes. So I wasn't shocked, but I was like, you know, I'm just watching the sign of the time. But usually that accelerates. Right. We're in typical phase transitions.

[Jason Lemkin]

But with these acquirers, were they PE.

[Rory O'Driscoll]

Backed platform, big tech leaders offered to buy two different companies for 500 million. Convergent evolutionary, same number. But one was just above the last round, right. A little profit. The other, they didn't care about the last round and it was Walker, you know, hell, or we don't care. And then they bought a much smaller competitor and lost. We'll lose years due to it. Right. But they didn't step up in the way I, I would expect. Not that they have to. It was just a sign for us all to make money. And you need folks really stepping up in these deals. Right. They're like, ah, Rory did the last deal at 700, I'm going to pay 2.1. That's the way venture was works. If that don't happen like the yammer and other deals, we don't make any money if they don't like pay 3x the last round guys. Otherwise it kind of collapses a little bit. Venture, I think the truth is this.

[Jason Lemkin]

There's times in the market where the euphoria takes off and people are willing to lean in. And then there's times when the other side feels it has leverage and doesn't want to do it as much. And look, right now, look, in a few cases like Wiz, I think they created all the leverage, they played it perfectly and then the other side did what they needed to do. They paid the big step up from the last round. I think in a lot of cases, look, all these people read the same press we read. They're saying venture guys, it's a little bit tough. No one's had liquidity and they're probably in the mode of I don't need to overpay. The only thing that changes that is if some of the companies that buy and buy successfully have success with those acquisitions. If you wait two years from now, you're competing with ServiceNow and the Movework acquisition is killing it and you're now second or third in the space I don't know who that would be. Would it be Zendex or whomever? Then, by God, you're gonna do what you have to do. Right? You're exactly right. One of the pressing facts about Venture is we make an embarrassingly large percentage of our money once every seven years. When you're in the white heat of must acquire must own high growth venture assets. And the trick in the other six years is surviving and keeping all the little companies alive and growing nicely so that when that moment comes, you have inventory to sell. That's probably not this year.

[Rory O'Driscoll]

Yeah, that's my sense. It's not. It's getting there. Right. Cause these offers happen. 500 million is not. I mean, we have a little bit of fun here. Right. In any absolute sense. It's an insane amount of money. Right. But it's not enough in Venture. Right.

[Alex]

Jason, what ownership do you have in those two companies?

[Rory O'Driscoll]

Let's just average them to 10.

[Jason Lemkin]

Nice.

[Alex]

Wow.

[Rory O'Driscoll]

Good for you.

[Alex]

No, dude, that in your funds. What, 70?

[Rory O'Driscoll]

Yeah, but that. But I did one. A 1X in a fund return is not enough, man. What's the point? We don't get out of bed for a fund returner. A fun returner just returns the fund. Like, everyone talks in venture about fund returners. Like, they're so great. I don't think they're so great, but it depends.

[Jason Lemkin]

Look, you're in that business, though. I mean, obviously, look, that's not the perspective of someone who has an $8 billion fund where they are humble enough to recognize that the poor guys are just going to have to chip away 2 billion at a time.

[Rory O'Driscoll]

Yeah, poor guys. Yeah. I'm not into that vibe. It's just not worth it. But really, I don't think a fund returner for seed is really enough. I mean, it's the classic 1x and then two deals do 0.05x and the rest do another. And you dribb. You drib and drab to the 3x. Right? You drib and drab. But, you know, I don't want to be in a walker. I need a nice place in Marleybone. Is that where 20 VC is? Is in Marleybone, Maryland?

[Alex]

Yeah.

[Rory O'Driscoll]

Yeah. I want one of those carriage houses. And I want like a nice one, you know, I want a nice one to, you know, that's going to be my fourth house in Marylebone. I'm down those cobbled streets with those carriage houses. You know what I'm talking about?

[Alex]

Then you should start a podcast, buddy.

[Rory O'Driscoll]

That's one way to do it. It's one way to do it. It can.

[Alex]

I thought when thinking about exit values, there was something fascinating. It was Ven CAP and lp. Interesting lp. And they basically did this analysis of exit values and they found that in the 99th percentile exit, so the top 1%, the price or the value grew from 1.4 billion in 2005, 2009 to 10.2 billion in the most recent five year period. Almost like a 5 or a 6x in the top 1% exit value. I wanted to hear your take on this first. And Rory, please slam the question in whatever way you feel relevant.

[Jason Lemkin]

First of all, I thought it was great analysis to the point where I actually emailed David and said send me the underlying data, which now gives me the advantage over you because I have it in front of me here so I can keep you honest.

[Alex]

Dude, I put this down as mine and you knew that I didn't do it.

[Jason Lemkin]

Absolutely, because it was mathematically correct. So I knew it wasn't. Harry, look, I think it's great analysis, profoundly great. The question is, and what it's being used to do is try and hypothesize if this trend continues, how big will exits be in 2, 3, 4, 5 years? And thus what's the ability of venture to raise ever and ever larger aggregate amounts and still make the math work? That's the embedded question in this. Unfortunately, the answer is one of degree in the sense of it definitely points to small number of exits getting larger, though the trend is not as pronounced as you think. The first period of time was 2000 to 2004 where the 90th percentile exit was as high as 3.3 billion. So in other words, they went down. You had a cyclical downer for 10 years before they started going up in the 2015-19 8 and then exploding up to 10 billion in 2020-2024. So it's not like this linear growth for all time, it's like a dip and then a growth back. So that's the first comment. So it's not as kind of clear a trend as you think. But I do believe at some macro level it's correct and it's simple. It's not that things are getting better, it's just that the longer you hold the company, the more compounding takes place, the more dispersion takes place, the big get bigger and the shitty ones are crap. It's just math. And therefore by definition, if the window to stay private stays longer, the size of the largest exit will be higher. I'VE no doubt like the largest single exit in this database in 2020-2024, the largest single outcome was actually two at 65 billion or above. If there's not four exits above 65 billion in the next five or seven years, then the people who bought Stripe, SpaceX, Databricks, OpenAI and Anthropic are screwed. So I don't think they're screwed. So I think there's going to be this trend is going to be even just as it's going to continue in the next four to five years. There's no doubt in my mind. And it's not for magical reasons, it's just because you're holding longer. Let me give you another example of that. It's really interesting. I looked at historical data. The biggest single exit in the period 2000 to 2004 was. You call it 99th decile. I don't think that's a useful term. The more useful point is it was the largest single exit because There was only one in. There was only one in that group. It was a $23 billion exit. It was Google in 04. If Google had stayed private one year longer, Google's market cap in the end of 05 it was about $140 billion. If they just stayed private another year, the entire data would be swamped by the fact that oh my God. The biggest venture exit ever was 140 billion in 05. If the Google CFO had had a heart attack in 2004 and they postponed owned their IPO for a year and a half, then the largest exit would have been in 04 and it would have been Google. The point here is all this is a derivative of small numbers of how long the very best companies stay private is all that's going on here. And it's true and it's a thing. What it means is that the bigger your fund, the more imperative it is you have to be in those six deals, which explains why capital is so easy to raise for those companies. It all makes sense. It was great analysis. I'm not sure it points to everybody can do great in venture because everything's going great. I think it points to the top end of a power law where it really matters to be in probably five or six companies at almost any price.

[Alex]

But if the top end of the power law is so much larger than it was previously, which I think we all agree will be that way in 10 years time, 2035, are we wrongly negative on the size of Lightspeed General Catalyst? You name your mega fund because we're considering today's exit size on something that we should consider as 10 years out exit size.

[Jason Lemkin]

I'm not negative. I think they have a great business. If you get the capital into those companies, then you're going to do great. I don't know if it supports everyone being able to do that. And the scale of late stage money relative to the opportunity, I think is much more nuanced. Maybe the way to say this, Harry, is this. The direction of travel is clear. As long as companies stay private longer, there are more opportunities. Not just at the 99th percentile, but at the 99.9 percentile, at the very tippy top. One or two deals per decade to be in them and compound for a long period of time. That's definitely true. Does that translate into all the funds making enough return on all the deals to kind of make the late stage amount work? Not as clear.

[Alex]

My just concern is just there's so few companies in that 99.9% decile. It's like a world of concentration unlike any that I think we've seen.

[Jason Lemkin]

You're exactly right.

[Rory O'Driscoll]

So, Rory, how do you know in a unicorn whether you should keep in or sell? How do you know? Where's the line?

[Jason Lemkin]

That's actually a great question. Obviously, look, it's so annoying. It always looks so clear in retrospect. You obviously shouldn't have sold any SpaceX ever. So the question is, how do you know at the time? And I think it really is a function of market size, momentum, most. I mean, it's. The classic problem is if you're presented with an exit opportunity at 5 billion, framing it clearly, let's say all your unicorns get to 5 billion and the great secondary gods come and say you can cash out anything you want. Now, statistically, let's say I could cash.

[Rory O'Driscoll]

It all out at the last cursor round at 9 billion.

[Jason Lemkin]

I mean, Mary Meeker used to do this analysis of IPOs, which was excellent. And because I believe private late stage companies in 2025 are just the same asset class as IPOs in 95 to 2005, the same analysis applies. Most of the companies barely beat their IPO price a year later or ever again. And a small number of companies compound and do amazing. So now, how does that become actionable? If you're sitting there and you can sell all your private companies at 5 billion or the last round price, statistically, 80% of the time you should sell, because that's what the stats say, but 20% of the time will cover the interesting thing is the 20% will not just make money themselves, but will cover all everything else. The wonderful thing about this business is compound is a very forgiving thing. So obviously, if you're smart enough to be able to tell the one good one from the four bad ones, sell the shit ones, keep the good one and you'll be rich. But if you can't do that, it is a matter of mathematical truth that the second best alternative is holding them all, provided you have one of the good ones in there. What's going on with all these late stage funds is some version of holding them all. If I do enough and I'm in the good ones and I double down on the good one, the long term trend to a massive tail in the power law is going to make me money.

[Rory O'Driscoll]

My new role is, listen, this is, you're lucky to be there, right? But when I was looking at this on a spreadsheet, my new Rule is at 2 billion, sell unless you're 100% sure you shouldn't as a seed manager. At 2 billion, I know it sounds goofy, but it sort of ties to doing better than returning the fund. Because the risk is unless you're sure. Unless you're sure, it's a SpaceX, right? Being in that 80% is not so great, is it?

[Jason Lemkin]

The truth is this. It's a hard comment, but they've made it harder for most investors and most funds because you're exactly right. Now you have to make these choices. Whereas before you got liquidity on the mall, now you're still in private land and you got to try and figure it out. And you're having to make those decisions with a smaller portfolio count. The truth is, if you need 20 deals when you're starting at a billion to compound to 100 billion at your stage, Jason, the portfolio count you need is much higher. And the way that manifests itself, if you've constructed your portfolio 10 years ago, assuming you got your exits 100 to 200, the risky thing is now you still gotta double down one or two or three more years from here. And as you say, the bad outcome is you have the 80% but not the 20% and you don't have the compounder that forgives all sins. So I think it's pretty smart. That's why the whole push towards taking money off the table as a secondary is just smart. I don't think you can take the risk of doubling down ad nauseam when you're 10 or 12 years in. It sucks, but there you are.

[Rory O'Driscoll]

Yeah, I Remember back in the day, I'm dating myself, but I was an emergency with Peter Gassner at Veeva, right. And I saw a little bit of happening and their LPs were very mad when they held because they own. They were the only real investor in viva.

[Jason Lemkin]

Right.

[Rory O'Driscoll]

30%. They own 30% at IPO. And I was just looking it up. It was worth. Which was a lot of money back then. It was worth 2.4 billion at IPO. Right. Let the partners hold, but distribute to the LPs. They're going to get 750 million. And it was probably a $250 million fund. We could you let it up. Right. It's a multiple fund returner on that one. Right. And because we had a few. When I was just starting, we had some LPs comment and they were kind of mad that what you guys held. But today it's worth. Even with some volatility, it's worth 40 billion.

[Jason Lemkin]

Agreed. 35.

[Rory O'Driscoll]

Right. And created billionaires out of that. Out of GPS. Created billionaires by holding. But how do you know. And I knew Peter was the best one out of our class, by the way, our batch. So maybe you can know like there was David Sachs was like 10 times better than me and there was Renee Lucert and others. But Peter was like fucking. Fucking off the planet in terms of quality as a CEO. But I didn't have the numbers. Right. But they made the bet, didn't they?

[Jason Lemkin]

Yes, they did. And the thing they had to their advantage was. Well, advantage or disadvantage was when you're public, you can make that decision. You can distribute and allow different people to make different decisions. That's the beauty of the public markets. If Viva had compounded as a private company, the company would still have been the same, but those choices would have been harder to make and different. You know, it wouldn't have been as easy to. There's no distribution as a concept. So interestingly enough, I hadn't processed this until real time. The incentive. And this is where I go back to my monothematic theme of the death of IPOs is just bad news all round for capital allocation. Because now as a gp, you're sitting there going, I want to hold this thing forever. My LP would probably like to get some liquidity. If it was public, I'd distribute and I'd keep mine. They'd sell theirs. Everybody would be happy because everyone can make choice and choice leads to optimal outcomes. Because we can't go public, I either have to sell now, which maybe is not what I want, or I have to ride it out for the next five years, which is maybe not what my LP wants. And I think that's inducing some tension in the system, which would go away if these things were public.

[Rory O'Driscoll]

Taxes alone can be an incentive for a GP to hold taxes alone. And Most of our LPs don't pay any taxes. Right. I mean, there's many other reasons. Right, but taxes alone, especially if you don't have QSBs, you're like, Ah, I got to pay 50% in San Francisco, like maybe a hold for another year, see what happens.

[Alex]

You have 50% capital gains.

[Rory O'Driscoll]

Well, if it's short term capital gains. Right. It's still going to be. Even with long term, you're going to be 15% in California. 22, you're going to still pay 40% in California long term capital gain.

[Alex]

Well, this is what I find. Nuts. We have half your cap gains.

[Jason Lemkin]

Yeah, but Harry, very true statement. You have half our cap gains. In fact, you have less than 10% of our cap gains. You guys wouldn't, I mean, I don't know if you saw the Wall Street Journal today, just dissing on Europe. You don't have any cap gains, so it doesn't matter. The taxation rate is purely notional.

[Alex]

What was that Wall Street Journal piece?

[Rory O'Driscoll]

That was the chart I put the ratio of Europe to us for.

[Alex]

What did it show, Jason?

[Rory O'Driscoll]

US companies, 90 companies worth over a billion worth 2.5 trillion. And EU only 333 billion. Right. So 333 billion versus 2.53 trillion. And a big chunk of the EU was Stripe, which you know, we can debate whether that's a European startup or not. Harry's got 100 of the best founders addressing this problem. So I'm not worried in five years. Sometimes I'm surprised there isn't more capital flight from at least like the us Makes it pretty hard to leave the country and it's a pretty bad, tough country to leave. But I'm surprised there aren't more people in Miami than there are. I'm really surprised they're not more. Because Harry, you saved 15% just moving over to Miami. There's some asterisks and daggers with it.

[Jason Lemkin]

But I've clarified my internal situation. Yeah, if I were to reduce my income tax by 25% by moving to a non tax based state, I would also reduce my net worth by 50% because my wife would be staying behind. So it's just not an option for me. So I am at peace with paying whatever Gavin Newsom needs to Keep this kind of bloated, overpaid show on the road. It's a great place to live. So I'm genuine, genuine comment. I wish it were lower, but tax is not the reason to leave California. We should all be so lucky to have cap gains. But the serious comment you made Jason, is that the beauty of public markets is allows everyone to make their own choices on their own economic decisions and they can hold if they want to build wealth. They can sell and pay taxes if they want to sell. It's a lot harder to do that in the private markets. I do believe we will look back and say there are reasons why the very best companies choose not to go public. But it's a darn shame that the public markets haven't addressed those concerns such that all this stuff could be done in the public markets.

[Alex]

Number one thing that you'd change if you ran the public markets to make it more appetizing for companies to go public.

[Jason Lemkin]

I love the idea of time based voting that they floated in. Don't call me this, the Dallas that there's Texas trying to get together an exchange with some of the lean company startups and some other folks. I don't remember the people. But the idea that your share weighting is in part a portion of how long you've been an investor in the company. It's kind of an extended version of the kind of just founder voting whereby because what happens in a public company is sometimes all the arbiters, all the short term investors pile in and they really push the company to make short term decisions. But if your vote was in partly a predicate of how long you'd been an owner of the company, I think that could lead to very different results. That's one random company. I don't know how to get away from the randomness, the noise level around quarterly calls and all that process. I mean Google for a long while did that by simply not doing them, which may be one approach I wish you could reduce just the anxiety and tension of that part of being public and always being on display. I don't know how to do that part of it. I do think forcing longer term holders is part of it.

[Rory O'Driscoll]

Sometimes I wonder if it's really so broken. Right. Some of our favorite CEOs from your portfolio. So Aaron Levy, he's you know, all in. Right. But certainly spoken of the headaches of activist shareholders and all that at box. Right. Huge headache for him then I was interviewing Brian Halligan a little while ago. You know he has some perspective on this now that he's chairman, he's like, honestly, it's not much more work being a public company doing this than it was being late stage. It's not that much more work. But HubSpot's a $30 billion company, so maybe the bar should just be high so you don't have to deal with these issues. If you hit your number, if you go 50% at 500 million and you grow, it's not really much of a huge deal. You have a huge finance team. It's not the end of the world to go public, is it?

[Jason Lemkin]

So, a couple of comments. One is the odd thing you have is the companies that do precise the best are precisely the ones who are in a position not to do it at all. You have the stripe situation. So it's the companies who want access to the capital at the 2, 3, 400 level for whom it's still a relatively big burden. But I do agree your point is actually the right one, not mine frankly. Which is, even though it's a bit of a pain in the ass, I do wish you could deal with things like activ silly regulations around board and board composition and all that. The real point is people respond to economic stimuli. If the capital were more expensive in the private markets than the public markets, then most CEOs would go to the public markets. The core reason it works is because there's a lot of capital available in private markets for companies doing 2 or 300 million in revenues with a lot less hassle than getting that same capital in the public side. And that's the reason they do it. People respond to price signals, CEOs respond to cost of capital signals. And there's no doubt that bazaar the cost of capital in the private markets remains cheaper than the public markets. Now it's interesting when you look back on the Chime $25 billion raise, an objective fact is this. The cost of that capital was twice as high as you thought at the time because you didn't give away 4%, you gave away 8. So it may well be that we're in this little bubble where we actually don't know the cost of capital for some of these late stage rounds. And if you get high priced rounds with lots of price protection and you ultimately go public, you may in fact discover that the last couple of round were way more expensive than you thought. I don't think it'll ever go back to $100 million IPOs, but I think there'll be more of a normalization on your choices between public and private.

[Alex]

I Want to finish today if that's okay with one final segment, which is my team love Calsheet. Like a predictions marketplace where you place bets in real world. They love it. And I chose three that I liked. Number one, will OpenAI stop being a nonprofit? Yes or no?

[Rory O'Driscoll]

The news cycle is so fast. As you point, Harry, I mean, what a loss for Sam versus Elon Musk in the short term. What a man. We already forgot about it. It's a total capitulation to ever being a traditional for profit company. Right?

[Jason Lemkin]

I'm going to go with yes because the question is weakly phrased enough that I can answer yes. Will it stop being a nonprofit? It doesn't give a time. At some point this company is going to get public. It's going to have a PBC type structure. It will get there. It'll take a lot of lawyers, but it will get there. So I bet yes on that one because there's no timing.

[Rory O'Driscoll]

Jason, I've never seen a dysfunctional company that's more successful than OpenAI. I mean, all the founders left, they fired the CEO brought them back. Nonprofit left profit for benefit, non benefit. The momentum's crazy, but man, the motivations are really weird in a nonprofit and giving that up. The folks I've seen on nonprofit boards, they're not going to give up this power. They're not going to give it up. No one I've seen on a nonprofit board wants to give up the power because there's no money in it. So it's all about the power.

[Jason Lemkin]

I'm going to disagree a little bit on that because I think that the motivations in terms of being a nonprofit were much more important for the engineering staff and the early employees who really had had a real profound belief that they were doing something important for mankind. I might share that belief in the slightest, to be clear, but I think that was a animating factor in attracting the very best intelligence into this business. Early on, the quote not for profit halo matter. It's no accident in my view that the two companies that have been most successful, OpenAI and Entropic, embraced that because they recognized that they're the most important audience for both of them was talented AI engineers. And all of them shared the religion that said this thing could change the world and be dangerous. So therefore they embraced the religion too. I don't think it's a question of the board of OpenAI not wanting to give it up. I think Brett Taylor is just such a smart dude. I think it's a question of untangling the mess. When you've got litigation on every side, Elon busting your chops, a bunch of state's attorneys, and you kind of know where you want to go low, it's going to be hard to get there. But in the end, the value of the asset is so high that there'll be some half assed cobble compromise whereby the entity will be a pbc, the not for profit will be one level up. And the only question is how much do they get? How much will Microsoft get? How much do the investors get? Somehow they'll figure it out. So I think they'll get there. It'll just be a wild and wacky journey.

[Alex]

The second one and we're going to count by minute. Response Max Chachi PT5 revealed this year, yes or no?

[Rory O'Driscoll]

The folks at OpenAI, the engineering talent is so much better than you realize. It's so next level. It's so next level, right? The talent that they that open AI, anthropic cursor and wind surf attract, it's epic. So if they want to merge all their models into one model, which would make my life easier because I can't even tell them apart, that would be great, right? It's time like this makes no sense at a consumer level. Right?

[Jason Lemkin]

But man, do you feature requests into the blog.

[Rory O'Driscoll]

But, but merging all of these, I mean, is it core enough to happen? Right. Maybe there's a reason it hasn't been announced. Right? It will happen. But given all the activity, it wouldn't be surprised to me if it pushes a year longer. Right? But they have the best in the world. I'm saying I think no, but it would be great.

[Alex]

Okay, you'll know. I'll take you on that one. I'll say yes. I think they will.

[Harry Stebbings]

The velocity of a no.

[Jason Lemkin]

Yes. And I don't know.

[Alex]

Jason, baby, you want O2 minis and Max, I'll give you dipling and real.

[Rory O'Driscoll]

As the final and real. Yeah.

[Alex]

Playing and real. Will ripling beat deal in the lawsuit 100%.

[Jason Lemkin]

Yes.

[Rory O'Driscoll]

There's no chance they'll lose. It could get settled, right? Which is they're always the right outcome. Even when there's a motion, the right outcome is always to settle it. Right? There's no way they lose 100%. The facts are too bad. There's no way they lose 100%. They stole trade secrets. This is a classic case. They're gonna lose.

[Alex]

So Jason, you're like gonna lose. Rory, gonna lose.

[Jason Lemkin]

I do agree, Jason. I think rippling prevails in this lawsuit. If it goes to court, I think it probably should settle because most civil litigation does settle. But it's hard to imagine from the fact. And I did see the counterclaim just recently, but it's still hard to imagine from the facts as stated.

[Alex]

Did you think the counterclaim was weak?

[Jason Lemkin]

It was some version of you guys did it too. I mean, the first filing Ripling made was deal made back was pretty blah and weird. It was about four or five weeks ago and it was full a lot of kind of weird. You went to Harvard or you were angry about something. I didn't quite understand it. This is a counterclaim that said the guy that we hired, I think you guys hired. It's all very. You did it too. But I just think I'm with Jason. I think the facts. And you have the person who made his affidavit and by the way, you've chosen to run to another country and hide. I just think the fact pattern looks crap and at some point sense prevails and you say, whoopsie, sorry, and settle. So yes, I would buy the. I would buy the yes on this one.

[Rory O'Driscoll]

The other thing you also, for what it's worth, I don't know how it works in the uk, but in the US counterclaims are not what they look like. Just, just as an fy, why they do it. And listen, I'm not a litigator, but I've, I've, I've been on the other side. You've do do tech long enough, you're going to be on both sides of these. Right? Counterclaims can offset any claims even if they're outside of the statute of limitations, even if they couldn't be brought on their own. So let's say Rippling wins. Let's say Rippling wins a billion dollars against steel and a lot of damage to damages. Even if they couldn't bring their own lawsuit, they might get an offset for 900 million. There are so many incentives to bring counterclaims that you would not bring as a claim. So there's always a lot of drama. And some of them won't even make sense. Like some of the counterclaims don't make sense. Right. And they're doing it for. They're doing it not because they think they're going to win. They're doing it because they know they're going to lose. And so you put everything in a counterclaim because everything counts as an offset. Right. It's a sign of losing these counterclaims. It's not a sign of Winning. And it's really stressful when you're on the other side and you get 10,000 counterclaims back. Because there's always some truth in it, right? There's always some truth in it. But it's a litigation game to get offsets. It's a sign, Harry, that they're gonna lose. All those counterclaims are ironically. Are assigned. They're gonna lose. If you're 100% in. In the. In. In the clear, you just say not guilty. You just ignore it. And. And you. And as a CEO, you go back to work. You don't flee to other countries. You go back to work and you say, parker, you do what? You do what Elon. And. And you do what Sam's doing with El. Sorry we misunderstood each other. Parker. Happy to have a beer and talk it out. That's what an innocent CEO says. Let's talk about it. You know, wherever at Harry's dying to come in.

[Jason Lemkin]

Let's hear it, Harry. Let's hear it.

[Alex]

As Alex is a dear friend and I'm also a deal shareholder, I would just like to add Alex has actually been abroad for many years. The media amplified him being somewhere where he's been for years.

[Rory O'Driscoll]

Yes, fair point. But you do. But my point is, right, what you do say, I'm sure if he's a.

[Jason Lemkin]

Plane ticket to Dublin, he probably. Probably wouldn't take it even if it was first class. Okay. Dude, he ain't coming to Dublin to testify on this puppy. So thank you.

[Alex]

Because no one's going to Dublin.

[Jason Lemkin]

Rory.

[Rory O'Driscoll]

No, but if you're going to win, if, in all seriousness, if deal's going to win, okay. You do what Sam did to Elon. You say to Parker. I know we disagree. Sorry. As friends, let's get together. We used to be partners. They used to be integrated. They used to be partners. We'll work together again. Sorry. We disagree. Sorry. Sorry things happened that shouldn't have happened. Let's talk about it. And you don't say anything else, but that's what you say if there's really nothing there. That's the power play.

[Jason Lemkin]

I'd go further. It's what you say if there's nothing there. And it's what you say if it's there. Also because you settled this thing. Because nothing good is going to come from this kind of litigation. Where And I checked it. Not now, but a few weeks ago, when we thought we were going to talk about this. All of this is just civil litigation. But the scary thing is some of the allegations could be interpreted in a criminal fashion. If I was the CEO of Deal, I would want to get this behind me so fast my head would hurt. I'd want to settle and bury it deep and say whoopsie, sorry, donation to the charity of your choices, whatever. I would want this done because I don't know if this is going to escalate to criminal. Because one of the things that's very funny when you see the difference between civil and criminal and civil people yell at each other. And I think the criminal, FBI, et cetera, are way more jaundiced and hard nosed and they're just like, we're not gonna get involved just cuz you kiddies are fighting with each other. They're only gonna get involved if they see malfeasance. But the more noise you make and the more yelling you do, the more risk you have is that someone looks at the file and says, let me think again. Yeah, it's in Ireland. But both of these are U.S. companies. There was an allegation here that would be an espionage issue. Suddenly we've drifted into some kind of theft of trade properties and suddenly someone opens an investigation, then you're fucked. If I was, my ass was on the line and I was the CEO of Deal, I'd be like, how much money does it take to settle this thing by Friday? Get it done.

[Alex]

This is going to. I know Alex, this is not going to happen. So that's fine.

[Jason Lemkin]

Hey look, it's a free look. People do what they do.

[Rory O'Driscoll]

You shouldn't be like to all founders out there, settle everything. Especially when you're not in the wrong. When you're not in the wrong, settle it right. When you're. When it's. Cause it's so hard if you're not in the wrong to settle it right. It's so wrong. That's the number one reason to settle it. When you're not wrong.

[Jason Lemkin]

But I will say this, two observations. One is everyone gets really emotional about litigation and starts getting personally invested in it. That's the first thing. But then the second thing is even more important. The lawyer that you engage will tell you you've got a great case. When you start out, as you get closer to the courtroom door and as you spent more and more money, they start changing the tune slightly just cause suddenly maybe you're just not hearing what they' saying on day one, the day before court, they'll be saying, remember I told you it was a 5050 bet? And you're like, I've just spent $2 million and six months preparing for this trial and you're telling me it's a 5050 bet and you'll sit there and go, if I knew then what I knew now, I'd have settled at the start, right?

[Rory O'Driscoll]

That's the best advice for this. People don't get it. I'm going to put this clipping in a post I did on it. Rory's right. Every single time you've been through, you meet with the lawyers and they tell you if you have a decent, you're going to. Your case is super strong, right? They tell you in the meeting, $2 million later, it gets close to trial and they're like, well, those counterclaims, I mean, they are silly. But a jury might not see it that way, right? The judge might. And all of a sudden it always gets closer to 50, 50. When you get to trial, the stress goes up. It's never worth it for either. Like, it's almost never worth it. But that story, every time you get your dander up and a lawyer tells you you've got a super strong case, I literally just went through this with the CEO. I said, hire someone great and have them play the other side. I literally just want this with CEO play the other side. Cuz they're going to tell you Rory's story and you're not going to want to do it anymore. 100% of the time. They change their tune. It's about $2 million in. They change their tune, isn't it? It's right around $2 million of legal expenses.

[Jason Lemkin]

That's so true. It's funny. My wife was a criminal defense attorney and she would always say the worst defendants are defendants who start talking about principles. I don't want to hear about your principles. I want to just hear what it takes to settle this thing. Right? Don't get on your dignity.

[Alex]

You guys said before about the amount of kids being put through college because AI's legal bills and everything around his legal bills. I think the same applies here. The end case. Invest in Wilson, Sonsini and Cooley, actually.

[Harry Stebbings]

But before we go, how could I forget? This was one of the biggest weeks for Jason with Sasta. So, Jason, before we leave today, I want to talk about Sasta.

[Alex]

You had the biggest and the best there. What are your big takeaways from seeing the world of sass come together in one place?

[Rory O'Driscoll]

The biggest takeaway, I think, is what Yamini from HubSpot and Aaron Levy both said is, I'm super excited, but I'm anxious. There was literally 50 times more energy at Saster this year than last year, 2024. I didn't realize until I was there it was the end of the Debbie Downer era. It was the end of folks saying wo is me. I was growing 70% in 2021 selling my fungible sales automation tool, and Now I'm growing 2%. Last year they were still. These people did not show up. And this was your idea, Harry. We had 300 sessions. I didn't allow one single session to talk about the past. It was banned. The past was the ban. You were only allowed to talk about AI and you were allowed to talk about AI today and tomorrow. And that was it. From the CEO of Snowflake HubSpot, we banned the past this year. You were right. Right. And it created like incredible energy and anxiety. But good anxiety. Right? You gotta work twice as hard and twice as fast.

[Jason Lemkin]

I think that's great positioning. Cause it was either after 0809 or I think it might've been after the dot com crash. What you saw two or three years later is even the survivors were scarred and there was just no ability to talk upside. And you're like, oh my God, I got from 10 to 15 to 18. But I'm just so shattered from the pain of the last three years that I lack the capacity to think big again. And many of those companies as a result, didn't make it. And I think that's really good positioning. You know, it's coming out hopefully into a picking up time. And I think that's what it takes to win this year. Because this whole SaaS is dying is bullshit. It's changing. And you better be AI forward or dead. But if you are, I'm very certain that if you do the right, make the right moves, you can grab hold of this thing and not just grow, but re accelerate growth. Which I think is what 25 has to be all about.

[Alex]

Jason, can I ask, you mentioned last week about buying clay out of fear and saying, hey, Rory, come to the CMO event. Come to the CMO event. I'm sure Rory was there cheering from the front row. I was in spirit. But what were the takeaways from the CMO event? A budget's open again. Are they buying clay out of fear? What was that takeaway?

[Rory O'Driscoll]

The basic vibe was everyone recognized 20 to 30% of their team is going to be replaced with AI and they're happy for it. Whether they're ready, whether the tools are ready today, or whether it's going to be six months, no one wants everyone is ready and behind closed doors, borderline excited for the bottom of the 20, 30% of their teams to be replaced by AI. No. No one's regretting it. No one's wondering, my God, my culture is going to be impacted at my company if the, if the sales rep that takes a week to get back to somebody loses their job to AI. No, no one was regretting the impact on culture. Seriously, no one was regretting. They were embracing it. How soon can I deploy tools to migrate out the bottom 30% of my company? I don't want them. No one wants him anymore.

[Jason Lemkin]

Jason is, it's not just that he's the grim reaper, but he's the happy grim reaper. He's like, I love my work. Let's do some reaping here, right? And yeah, maybe the positive spin on that is you can grow 30% next year and not add any headcount. But you know, it's the same story, just perhaps a little bit more benignly placed. And we all know it won't actually happen that way. There will be some churn. But yes, it's all versions of the same story, which is AI is a productivity lift at some level.

[Rory O'Driscoll]

They're stressed about the change though, because almost everybody also recognized moats are weaker. Whether you're Windsurf or HubSpot, the moats are weaker.

[Jason Lemkin]

I buy that now. I think over time moats will emerge. But you're exactly right, this is a. We often refer to some deals as it's a run fast deal. A good portion of the value that will be created over the next three years is just by running fast.

[Alex]

You talk about running fast. I mean, to be fair, Windsurf ran faster than anyone in terms of what they built as quickly as they did do. And then to get to the sale position that they did do. And then last night or yesterday whenever it was, Microsoft announced obviously that open sourcing VS code really putting a dent, I think some would say, in the hopes and enthusiasms and values evaluations of Windsurf and Cursor. How did you guys analyze that one when you saw that announcement about open sourcing VS code?

[Jason Lemkin]

It's interesting because yes, it amps up the competitive tension, but it is also worth stepping back. If you were the developer behemoth, which was Microsoft. The fact that you have to do this now to remain relevant at a zoom out level, this is a sign of relative weakness, not absolute weakness. There's still, but you know, if you had dominance already, you wouldn't feel the need. They're not going to open Source Windows OS that's been talked over the years. When you have a dominant position, you don't have to be nice. This is a manifestation of them feeling competitive heat, always recognizing, as they have for 30, 40 years now, developers, developers. So they're doing something to stay competitive. So it might dent your perceived valuation if you're one of the competitors. But you got to give yourself an attaboy. You punched hard enough on a $3 trillion market cap company that they felt the need to make this move.

[Alex]

Did anyone have an AI SDR that actually worked?

[Jason Lemkin]

Do they work and does value accrue are two different questions. And they occur in roughly that sequence. In other words, if you don't have clarity on if they work or not, then you shouldn't be thinking about where does value accrue, because no one's going to make any value anywhere. So first you got to say to yourself, what parts of the sales process can be automated? And I'm 100% with Jason. There are parts that work well today day, there are parts that will work well in six, nine months as the kind of technology progresses, and there are parts that don't work well. You probably don't do your marquee email to your very best prospect, but you all have, coming back from a trade show or something like that, masses and masses of leads that just don't get followed up on. Right. There's a whole bucketization of. It's not so much the marquee work you're already doing as all the work you should be doing, but you never get around. That alone is a significant lift. It's back to what Jason said. It's a 50% idea. If you make the reps 50% more productive, if you get them to focus on their key tasks, you're giving yourself 50% lift, and that's nothing. But I do agree, Harry. You have to be very granular on what works and not works. And we've seen that in all, I think, in all our AI companies, which is why, going back to the investing thing, step one on all these deals and every AI deal is do you, the vendor, and you, the customer, have a mutually agreed figure of merit on what success looks like that you can both track? If not, at some point you're going to churn, because one side or the other, either you're going to underperform or they're going to think you're going to underperform. You have to be aligned around that and then you have to be really honest. Are you delivering it? And time Everything your pacing, your aggression to when you are in fact delivering enough value to be able to keep them happy and keep them moving, moving forward.

[Rory O'Driscoll]

I do think to Harry's point though the invent like I'm not smart enough to know which hundred to invest in, right? On the other hand, how many note taker apps are there, right? I Believe based on CB insights there's over 18,000 note taking apps. But on the other hand it has a privileged position at Zoom. But Otter, I just announced across 100 million in revenue, right? And there's several over 10 and so I'm like this crap's bundled in and like I can't tell the difference. And note taking is because becoming like Voice, like Gong, like for a while Gong was disruptive and it still is, but now that functionality is built into everything, right?

[Jason Lemkin]

But go back cause I think Gong is interesting actually because you made the comment. I think that's an example of someone who took voice as an entry point, built a compelling multi hundred million dollar AOR business. But if you look at what they do today, voice recording or let's call it sales specific note taking which was core to what they did five years ago is only a part of what they do today. And what they've done is they've used that entry point point, they've built a stack, they've added forecasting, they've added CRM updating, they've added a whole bunch of related functionality and now I believe they're re accelerating and now they have a defendable business where AI was the wedge product and then you had to hustle your way and add the other stuff. And I think that's going to be the dominant mode for a lot of these companies why I call them run fast deals. You got to pick your wedge AI entry point for that two or three years where those kind of magic AI project. But you gotta operate on the assumption that three, five years from now the core thing you do is going to be commodified and what you gotta do is have used the magic moment to get the distribution and then built on top of that defensibility. Ganga I think has done a very good job of that.

[Alex]

Amazon, Apple, Google, we name the most defining companies of our time and the list can go on and on and on. You can even choose big consumer brands. Point is Fireflies, Otter, Granola, every sub verdict just for me as an investor, they bring them to the IC with me and I'm like oh this is not a deal that I want to be in one of a Hundred.

[Jason Lemkin]

I can remember being a snarky little 30 year old VC making snide comments that Amazon was just a bookseller. Okay. I remember in 96 when Kleiner did the round and I think they went public in 97. That was when companies actually went public quickly. And you know, it was a very, you know, you could have got your head around the teeny tiny tam. It was a wedge. The thing is, sometimes you gotta see the wedge, point the wedge and then where you can go from there. So I do hear you. Note taking is a crowded vertical. It's a crowded space. It's one I actually love and would like to find a play in and could talk about for a while later. But sometimes don't make the mistake of looking just at the market today. Look at where you can go with that product and can you articulate a longer vision.

[Rory O'Driscoll]

But Rory, going to Harry's point, when you're looking at deals at scale to today, has defensibility and unique selling proposition, has that gone down when you score a deal, has it gone down? That's kind of the question Harry's asked because he's brought these deals, the revenue's there, he likes the founder, but he can't. Defensibility appears to approach zero in some of these deals.

[Jason Lemkin]

We just actually had a, you know, a polite version of an argument on this in our partners meeting just yesterday. Right. You know, I'm looking at a deal, I won't say which one, which was in a very commodified market with lots of revenue, lots of good growth, but oh my God, they can name 10 competitors. And one of my other partners that I've worked for 20 plus years is looking at a high risk, high intellectual property deal with no revenues right now. But clearly, and you know, lots of technical risk, but clearly if you pull it off, massive defensibility. And we're sitting here going how do we trade off these two things? And I will say we've definitely skewed more to we will do the run fasting but you got to go in with your eyes open and know that you have the team that will run fast. And from a portfolio construction perspective, I really like the fact that we're trying to add some more singular different companies where it's an n of 1, ideally with some more product market fit. But where you kind of go, this has defensibility and a much longer run because I don't want to wake up with every deal being exactly GPT plus and 27 competitors in three years. So it's a Tough and competitive investing environment from those perspectives.

[Alex]

Listen, behind it all is the model providers, the ones that are the shit businesses, right? We go through the peaks and troughs of like, oh, they're great, that commodities. And now we're in the realization that OpenAI and Anthropic are actually phenomenal businesses. Anthropic run rate revenue grew from a billion in Q4, 24 to 2 billion in Q1 25, 100,000 plus customers grew 8x. How did we analyze this? Is this way better than we thought? Was this what you thought? Does it change your perspective on Anthropic?

[Rory O'Driscoll]

I mean, listen, you can segment the market, but it's also that Anthropic's a distant number two in some ways, right? And the growth is jaw dropping. Right. On the other hand, listen, I'm not vent. You guys have chat about. I mean open AI also said they're going to burn at least another 44 billion until they're profitable in 2029. At least another 44 billion. It is jaw dropping. It's the, it's the old Amazon thing from the old days that Rory said on like 18 doses of steroids, right? Everyone's all in. It's another 44 billion. But it's clearly a multitrillion dollar company. So the math ties. Is it a new world or will it collapse on itself?

[Alex]

I interviewed a growth investor this morning. Sorry to interrupt you. And he's already a holder in Anthropic. And he said, I'm trying to buy every employee's options. I'm trying to buy everything around Anthropic that I can. I'll get $1 billion worth. I've got supply from my LPs for five.

[Jason Lemkin]

I'd believe it because they're great businesses. And you know, I did. I haven't cycled short the way you described the up down. They always have to be great businesses because they're the most defensible part of the stack. I mean, I don't buy the commodification argument. There's going to be two or three of them. I don't think there's going to be 10. People are going to build around that and they're going to make technical choices and you're going to fast forward five years and just like lots of people could do Amazon web services in 2007 or 8, once you're 10 years in and you have the scale and you have the development environments and all, all the rest, those are going to be great businesses. They're going to be Great businesses. Will they be worth 300 billion or 1 trillion? I don't have a developed opinion but no. They're the anchor tenants of the AI economy. Just as Amazon, Azure and whatever Google Cloud were kind of the anchors of the cloud economy, the great businesses.

[Alex]

With the rise of great companies comes the fall of others. Chegg $12 billion to $95 million third round of layoffs. Is this just exactly what we said? That moats are smaller than ever and companies can be changed overnight?

[Jason Lemkin]

Yes, short answer and why would I pay Chegg for X when I can Lily type it into ChatGPT. That was a business that was dead roadkill in front of Jason.

[Alex]

What's the most obvious next?

[Rory O'Driscoll]

Chegg, the tough one. If MCP really works, right and it's very interesting seeing HubSpot and Box and Dropbox be excited about them. If it really works, we we won't even really need these applications. If I can use NCP to grab my content from Box and I can do better thing more powerful things with it by combining it with my own model, I'll barely even know Box exists. If and like HubSpot is great, but if I, if my own AI can pull out all the structured information out of HubSpot and run my own AI the way I want want to do it, I might not even, you know, what is HubSpot going to be worth to me if I can put my own AI, my own agents on top of these apps. All these ones that we think are so great because they're databases, I think they instantly become vulnerable because they just become databases. They just become databases I think. And I think they know it. I think that's why everyone's stressed.

[Jason Lemkin]

The only pushback I'd give is the word instantly. I mean I think I do believe AI will exert pressure on some of these apps in terms of newer solutions to do it. But I do think we should assume that the replacement cycle plays out over 10 plus years. I think the existing dominant vendors have a chance to ride it out. I think look at what ServiceNow is doing very aggressively. But I think you're right. If you are asleep then, or if your app doesn't deliver a ton of value then you will get ground down slowly and painfully.

[Alex]

So you mentioned that like turning very quickly into a database. People say that about Salesforce. If you were to look forward would you be a buyer or a sell on Salesforce with the potential for it to be a database overnight?

[Jason Lemkin]

Yeah, I mean I hold Salesforce stock, I'm not a seller I think they're not going to be an explosive grower from here, to say the least. But I think one thing we underestimate is the power of incumbency. Not to be a venture type IRR performer where you're hyper growth and tracking an ipo, but just the ability of these big tech companies to extract massive profits and massive cash flow at scale. If Salesforce is just a database in 10 or 15 years, it doesn't mean they can. They can still kick off gabs and gabs of cash. I mean, all you have to do is look at Oracle. It's not only is it just a database, it is a fricking database. That's what they did first. And Larry, depending on the day, is somewhere between the first and the fourth richest man on the planet. He's not sitting there going, oh, I wish I was cool in AI. He's going, I know how to optimize every damn dime from these corporate customers. We'll ship just enough new stuff to keep them on board and we will build a wildly profitable, I think 43% operating margin business. So I'm not looking at Salesforce to provide the oomph in my portfolio, but I wouldn't want to offload that stock with those cash flows because I just don't think it's going away. We use Salesforce in our shop here. I think I'll be dead before we rip it out.

[Alex]

Listen, guys, the average episode that we do now gets 3.5 million plays now across the five. Pretty fucking cool. I so appreciate you guys. Rory, thank you for rephrasing every question. Thank you. Jason's gonna fire me and just get an AI.

[Jason Lemkin]

Harry, I just wanna be clear.

[Rory O'Driscoll]

All I just once said would be fun.

[Jason Lemkin]

I was just bringing it back to the questions. That was in the notes that I prepared to. You kind of went off script in the first two minutes. It took you 30 minutes to even get back to the second question. I was like, dude, I didn't prepare for fricking versus forking. Give me a break here.

[Alex]

I blame Jason. They were in his notes. Guys, you're amazing. Thank you so much.

[Rory O'Driscoll]

All right, rock and roll.

[Jason Lemkin]

Take care, guys.

[Rory O'Driscoll]

Dipling and real for the win.

[Harry Stebbings]

I mean, you hear it in my voice. Those shows are my favorite shows of the week to record. Jason and Rory and are just such incredible people. We've got a very special guest joining us next week. I cannot wait to bring you that episode. I hope you enjoy it. Let me know what you think. I love your feedback. Let me know. But before we leave you today, here are two fun facts about our newest brand sponsor, Kajabi. First, their customers just crossed a collective $8 billion in total revenue.

[Rory O'Driscoll]

Wow.

[Harry Stebbings]

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