America IS WINNING! Economic Data Tells Us The Truth

0:00David Steinberg:Hello, everyone. We had a spectacle at the State of the Union last night. President Trump boasted about his economic accomplishments, and a public company CEO is going to join us today to explain what exactly is happening with artificial intelligence and software stocks. We're live today from the desk of Anthony Pompliano.

0:24out.

0:25David Steinberg:Before we get into today's episode, I need your help. We currently have 44 ,552 subscribers on YouTube. With your help, we'll get to my goal of 1 million. Hit the subscribe button and let's get into today's episode. All right, ladies and gentlemen, the president of the United States held his annual State of the Union last night. He gave the longest speech in modern history at the event, and he covered many different topics. Just look at how long this was compared to all the other speeches. Now, my personal favorite moments were the patriotic acknowledgement of various American heroes. The USA men's hockey team, they recently won gold medals.

0:57David Steinberg:They were in attendance and they received a standing ovation. Scott Ruskin, the Coast Guard rescue swimmer who saved 165 lives during that Camp Mystic flood a couple of years ago, he was recognized as well. Air Force Staff Sergeant Andrew Wolf, who was shot in the head in Washington, D.C. last year, he got similar treatment. And Chief Warrant Officer 5, Eric Slover, just an American badass. He's the American helicopter pilot who was seriously wounded during the Maduro raid in Venezuela. He was awarded the Medal of Honor, the military's highest honor, and he got it in front of the commander in chief and the nation's leaders.

1:32David Steinberg:This spectacle was a complete cultural victory for patriotic Americans who want to see the country continue to thrive. and those that understand that our country is built by courageous men and women who are willing to do the impossible for the flag on their chest. But President Trump also spent a substantial amount of time discussing the U.S. economy as well. He reiterated his belief that his administration has led a strong economic turnaround that includes bringing inflation down substantially. Here are a couple of his key quotes that he talked about during the State of the Union. He described inheriting a nation in crisis with a stagnant economy and inflation at record levels.

2:07David Steinberg:He called it the worst inflation in the history of our country. He stated that inflation is plummeting. And in 12 months, his administration has driven core inflation down to the lowest level in more than five years. And in the last three months of 2025, it was down to 1.7%. On gasoline, he said gasoline, which reached a peak of over$6 a gallon in some states. It is now below$2.30 a gallon in most states. And in some places, it's$1.99 a gallon. And when he visited the great state of Iowa just a few weeks ago, he claims that he saw$1.85 a gallon for gasoline. Now, he highlighted specific food prices coming down, such as the price of eggs down 60%, and even beef, which was very high, is starting to come down significantly as well.

2:50David Steinberg:Now, here's the thing. I know that there's gonna be an incredible debate about what numbers are accurate and whether the president was right or wrong in his claims. I'm not interested in any of the political nonsense. I am merely viewing the State of the Union through the perspective of an investor. And so I immediately go to the data source that I trust most, Truflation. According to this real-time metric, inflation was 2.3 % a year ago, and it now sits around 0.9%. That is a very big, significant drop in inflation in just 12 months. But more interestingly, Truflation is now reporting deflation is already here in a few sectors.

3:23David Steinberg:There is a negative 1.5 % year-over-year growth rate in the median sales price of existing homes. That's right, home prices have gone down 1.5 % over the last year. The Truflation Breakfast Index, that's what tracks real-time price movements for things like milk, lean hogs, live cattle, eggs, oats, orange juice, cocoa, coffee, sugar, wheat, and tea. Well, that breakfast index has seen a substantial decrease in prices over the last 12 months as well. And these are just a few of the examples where the real-time alternative metrics are telling a very compelling story about the direction for consumer prices.

3:56David Steinberg:With that said, you will still hear many people complain about how expensive everything is right now. Both things can be true at the same time though. Prices can be coming down on a relative basis over the last year, while consumers are still feeling the negative effects of the substantial increase in prices over the last half decade. This is where so much of the controversy and debate around economic data lies, in my opinion. Both sides are partially correct. So they each just dig in their heels and vigorously defend their position. But the most important thing for investors right now, it's avoiding the rearview mirror.

4:26David Steinberg:It doesn't matter what happened five years ago, nor does it matter what happened over the last 12 months. The only thing that will impact your portfolio is what happens next. And the current risk right now is deflation, not inflation. If that becomes reality, the government's going to have to print more money and they're going to advocate for lower and lower interest rates. And things are about to get even crazier. So you're going to have to buckle up, keep your head on a swivel and pay attention. The State of the Union may have been a spectacle, but you haven't seen anything yet compared to what is likely to happen in the market if things continue on the path that they're going.

4:59David Steinberg:Today, we've got a very special treat. I'm sitting down with David Steinberg. He is the CEO and founder of Zeta Global. And in this conversation, we talked to him about what's going on in artificial intelligence, why software stocks are under so much pressure, how he's using artificial intelligence in their products, but also in their development process. And then we get a broad view as to what his company thinks is going to happen in the future. Here's my conversation with David Steinberg. All right, David, I thought a great place to start the conversation. Software stocks have been getting pummeled.

5:26David Steinberg:Everyone is worried about the SaaS apocalypse. They think the world is ending. Every software entrepreneur is an idiot and everything is going to zero. I'm assuming you don't think that, but what's your view as to what's going on in the market right now?

5:38Anthony Pompliano:Well, first of all, normally it takes my kids to call me an idiot, not all of Wall Street. But the reality is that I think it is one of the silliest narratives I've seen in quite some time. You know, we think about large language models as very foundational, much like AWS or Snowflake. And when we think about how they're going to operate inside of enterprise software businesses, they're going to become a component of our tech stack. And yeah, we're going to pay them for it. That's how it works. We've already partnered with OpenAI. We already work with Anthropic. We already work with Gemini. We already work with Microsoft.

6:14Anthony Pompliano:We're already doing it. And what we're going to see is that the efficiency and growth that it drives to our business, we believe, will be more than offset by efficiencies in our business and the lowering of costs. So if you think about enterprise software in its entirety, there are companies that are just doing workflow management. And Anthony, I think they're going to have a problem. They're going to have to figure out a new strategy. But companies like Zeta and others that are creating intelligence, we are the brain that drives our clients' marketing and business intelligence. You can't just swap that out.

6:58Anthony Pompliano:You know, the other big differentiator for Zeta and others, I mean, I'm sort of my shareholders like me to talk about us, is we have three massive modes. One is our data cloud, which has 552 million people opted in, 5 ,000 to 7 ,000 data elements, a trillion marketing signals ingested, days, weeks, months. All of that is exclusive to our model training. We don't share it with any large language models. Two, for every dollar spent through the Zeta marketing platform, we return$6 in revenue. That is a Forrester certified number. We have a 600 % return on marketing spend through our platform. And three, one of the things nobody's talking about, Anthony, and a lot of big enterprise software companies have this, is the ability to work with Fortune 500 companies.

7:54Anthony Pompliano:That takes the ability to go through data security, data privacy, SOC 2 audits every year, procurement groups, legal, accounting. That's very, very difficult. And at Zeta, we work with 51 % of the Fortune 100 companies today and 24 % of the Fortune 500. That's stuff that's just not going to be disintermediated.

8:19David Steinberg:When you see this playing out, right, I think that there's investors who say, hey, these companies are not only going to be just as well as we thought they were going to be. They actually may be better off because of this technology. But there's this dislocation, this dislocation of the market. But then there's other people who say, no, actually, the companies are going to continue to do well. Your revenue, your profit are going to go up. It's just the multiple is going to compress. And therefore, the valuation is different, but the company still continues to do well. How do you look at it?

8:45Anthony Pompliano:You know, we're 30 days into this. We're not, you know, three years into it. I wouldn't call this, you know, this is a certainly been a short term re-rating of software from a multiple perspective. If you look at our company, you know, we just destroyed earnings and our stock is down meaningfully from before that. But the reality is that I think, A, for level-headed investors, this creates a massive opportunity to buy into high-growth, high-profit companies that have massive moats around their businesses that, you know, in the short term are being hit because a couple of blog posts. I mean, let's look at this, right?

9:25Anthony Pompliano:I mean, IBM went down by$40 billion dollars market gap because of a blog post. I don't see that as a total disruption to their business. And I think that when you look at these businesses, as I said, you're going to have a set of businesses like Zeta and others, and I think IBM is in this camp, that create meaningful intelligence on behalf of companies. We are fully embedded, and this is going to be a renaissance for us. When we use OpenAI to build Athena, which is our super agent, which I think we'll talk about in a few minutes, it allows enterprise clients to more seamlessly manage our platform.

10:10Anthony Pompliano:What I like to say, Anthony, is we've built a 747 for a platform and our average client knows how to fly a Cessna, right? Athena is a voice-enabled super agent that you just talked to and guides you through using the platform and in real time manages the platform for you for outcomes, not just to tell you how to do things. Listen, we use Anthropic every day. And if you look at our engineering team, we've increased our productivity by 125%. So 25 % productivity increment in just a year. Now, the crazy thing is you get 150 % productivity load, but you've got a Q &A pretty closely that takes it down from 150 to 125.

10:58Anthony Pompliano:But when you look at the hundreds of engineers we have, and they're pretty highly paid, the ability to even get a 25 % productivity by using Claude, using Gilt, using Microsoft tools is a meaningful step change for us. And by the way, our goal is to get that to 150 net or 200 net. We think if we continue to adopt those tools, we'll stay way out in front of anybody who's trying to catch us.

11:25David Steinberg:Now, one of the things that's interesting to me is so you guys have this massive data platform. You've built this AI co-pilot that you're talking about. But I think one of the aspects when I talk to various consumers, but also people building this technology is it feels like there is kind of phase one, which is, okay, I talk to the AI, whether it's via text, voice, whatever. And the AI kind of tells me what to do. But I'm the human. I've got my finger, you know, kind of on the button. I'm the one who's actually going to execute whatever the thing is that I want to execute. Phase two is I tell the AI what I want to happen, and it kind of just autonomously goes and does those things for me.

11:59David Steinberg:And so now I'm kind of delegating, and I'm trusting that the AI is autonomous enough and accurate and can kind of pull that off. When do you think that, whether it's your platform or others, like we'll start to see that really showing up in the enterprise and in some of these types of products?

12:13Anthony Pompliano:Yeah, and Athena can do just that. Like if you said to Athena, you know, I would like to lower my marketing cost by 7%, but on average, you know, per customer acquisition and create 2 million incremental customers I'm willing to invest to do that. Athena, can you do that for me and send me a report every hour? But please email me the report because I'm not going to be at my desk so I can see it and we can make changes. It can do that. It's already doing that for beta customers. So, you know, it's coming. A lot of it's going to come down to trust.

12:49David Steinberg:Because you think the consumer or the customer doesn't yet trust the AI enough, just broadly on an industry basis.

12:55Anthony Pompliano:Our collective clients are spending$100 billion a year on marketing today, Anthony. We have, you know, call it 1 % wallet share, 1.3 % wallet share. Our goal is obviously to get to 10 % wallet share. How do we build a$10 billion a year business? But if you're spending, you know, you're a company and you're spending a billion, two billion, three billion a year on marketing, I'm not sure you're going to trust an AI agent to invest a billion dollars a year or two billion dollars a year. You're going to trust the agent to set it up. You're going to trust the agent to sort of effectuate everything and make sure you're getting it into a place where it can be operational.

13:34Anthony Pompliano:And you might even tell Athena to do it, run the different campaigns, but you're going to want reporting. You're going to want to make sure you're looking at it on a regular basis. You can even tell Athena, if we don't see the savings that we expect, I want you to pause until we re-speak. All of that's built into the platform. But a lot of it, once again, when you think about sort of very big decisions by enterprises or individuals, I think they're going to be less likely to fully give away decision making to an agent in the short run. In the long run, I'm sure we'll get used to it. But listen, I'm old, Anthony.

14:15Anthony Pompliano:I've been doing this for a long time. This is 36 years of CEO of seven companies I founded. And I would tell you that the internet was going to end all things. It was going to change everything. I will tell you that you can go through how AWS was going to end how everybody operated. And the different clean rooms were going to disintermediate all software. You were just going to have little applications that would sit on top of it. And in the end, the companies that have really survived and thrived have been the enterprise software companies. And you could look at the big seven. They obviously are also consumer-facing.

14:55Anthony Pompliano:But these companies are really servicing enterprises. They're really creating intelligence. And I think that we're all going to be using large language models as tools to make our businesses more efficient, make our products easier to use and navigate. I mean, think about all of the software products you use and license, Anthony. What percentage of them do you actually use versus you pay for the whole thing, right?

15:23David Steinberg:Yeah, it's pretty crazy. When you think about Zeta, one of the things you told me a long time ago is just keep beating earnings quarter after quarter after quarter, and you end up with a pretty good business. You guys recently reported your earnings. What did you guys report?

15:38Anthony Pompliano:We reported our 18th consecutive beating of guidance and raising guidance. We we've been public, interestingly enough, for 18 quarters. So 18 quarters of being public, 18 quarters of beating and raising. You know, we reported a spectacular year, call it one point three billion in revenue, two hundred and seventy nine million dollars in EBITDA, you know, 28 percent year over year growth, ex-political and M &A and a I believe a 21 percent operating margin. So above the rule of 50, again, as an operating company. And by the way, we gave guidance this year for$1.755 billion in growth. So remember, when you beat and raise every quarter, it compounds, right?

16:27Anthony Pompliano:So you start the year at one guide and you finish the year if you beat and raise four times meaningfully above, as we did in 2003, 2004, 2005. we're starting the year at a 35 % growth projection, a 40 % EBITDA projection, and a 40 % free cashflow projection for growth. What I would tell you is last year, 2025, we grew the business 28 % top line. We grew EBITDA, I'm trying to look for the exact number, by a lot, and we grew free cashflow by 78%. So, you know, if you look at the different Numbers, what I always say, Anthony, we have talked about this a couple of times together. Numbers are outputs.

17:14Anthony Pompliano:The inputs are, is your business working? Are you solving your client's biggest problems and creating the outcomes that they need?

17:25David Steinberg:When you have free cash flow growing 70, 80 % year over year, what do you do with all the cash? That's a pretty significant number.

17:32Anthony Pompliano:Well, we bought back a large percentage of our stock and we continue to buy our stock back. We think our stock is heavily undervalued at this point. Therefore, we're buying it. We have bought, as I was joking yesterday, we've been around for 18 years. So I'm now going with this sort of 18 cubed. We've been around for 18 years. We've been public for 18 months. In the 18 years we've been public, we've bought 18 companies. It is highly probable, Anthony, we'll buy a 19. You know, and, you know, we have we have a pretty, you know, incredible balance sheet for a company of our size. We have a lot of cash on hand.

18:10Anthony Pompliano:We generate meaningful free cash flow. We have a zero debt ratio. go. So, you know, this sort of SaaSpocalypse could lead to some very interesting opportunities for us from an acquisition perspective, as we always jokingly say, never waste a crisis. You know, people forget we started programming in artificial intelligence in 2017, so not seven or eight years ago, but that came out of a crisis. We had sort of rolled up a bunch of email service provisioning businesses. And we saw that was not where the puck was going. Good hockey reference this week with the Olympics, right? But the reality is that we saw that if we made artificial intelligence and data as foundational to the application layer, we would be able to win in the marketplace.

19:03Anthony Pompliano:And we actually took three years to completely re-architect an entirely new platform and launched it out of that crisis. During COVID, we completely re-architected our business during that period. And I would tell you that not only did we grow in that year, since that year, the business has been on a compounded growth rate of greater than 30 % per year after COVID. So, you know, I think, you know, we're looking at this as, you know, So it's actually not a crisis for our business because our business, as you saw, you know, operating really, really well. What I would tell you is that we just, you know, we're looking at this narrative that all of these software and enterprise clients are going to be out of business is very, very silly.

19:54Anthony Pompliano:It is.

19:54David Steinberg:It is quite funny to me that people think the world is just going to end because of all of this.

19:59Anthony Pompliano:But, hey, you know what? Maybe you and I are wrong. Forget about the fact, Anthony, they've each got to come up with a trillion dollars to cover their expenses that they've put out there. Like, it's like it's not like they need to come up with 10 million dollars here. This is a you know, they're making trillions of dollars in commitments across these organizations that are going back and forth between the large language models and very large enterprises. and then they're investing. But I'm not sure they can invest enough to cover all of those expenses. I'm not suggesting they're going away. I think they're all great companies and I think they're going to be massively valuable to us as tools.