The Race for Super Intelligence Will Decide Our Future as a Species w/ Salim Ismail & Dave Blundin | EP #179

26:16So then Sam saying, hey, they're trying to buy everybody back for a hundred million bucks. Like, well, dude, you just took everybody. So, you know, it's fair game. But the question I have is why were they leaving in the first place? And why did Lama 4 not come out the way they wanted it? And so we'll dig in on that, I'll try and get to the bottom of exactly what's going on there. But the tide is certainly throwing money at it as one way to turn the tide. Yeah. So, you know, the story here again is meta tried to by SSI. They were rebuffed. And now they're trying to hire Daniel Gross, who's the CEO of SSI and Nat Friedman, who's been on our stage at abundance 360.

26:57Again, he's out shopping and he just made an acquisition. He hit the Neem and Marcus store for AI and he basically bought our friends at scale AI, Alexander Wang also was on stage with me a couple years ago at A360. $14 .8 billion for 49 % of non -voting stake in scale AI. Dave, the IPO markets are just beginning to open in the tech and AI space. The acquisition markets are getting hot. You're deploying Link XPV's venture fund in companies out of MIT and Harvard. How are you seeing the acceleration? It's been relatively a closed IPO and acquisition market over the last five years. Does it feel like it's opening up now?

27:51I say as of the last month, it's wide open. These deals are unprecedented huge deals. the core we vibe is way up, circle is way up because it's the way that agents can transact with each other. So yeah, the Yahoo moment clearly happens, the door is wide open. And the deals are still concentrated among the top, the magnificent seven, but Jamie Dimon sees that Bank of America, everybody else sees that. So their banking teams are spooling up, everyone's getting ready, it's going to be just like 1997, 1998 all over again. That would be great. But much bigger. So also, you know, a couple, I don't know if people care, but the structure of the deal is really important.

28:34Please. And I know a lot about the topic. If you can cut it out of the podcast if people don't care. But this is the deal structure of the future. The 49 % acquisition, Dodge's heart's got radino. So the deal is closed the day you sign it. You don't have to go through the six -month torture waiting cycle of DOJ review. and it does skirt the edge of the rules, but the rules are bright line. So, and there are two parts to it. 49 % is not a controlling stake, so you don't have to report. The other part is it's a non -voting stake. There's another threshold of 19 .9 % or 20 % ownership where you have to consolidate financials, but because it's a non -voting stake, you dodge that rule as well.

29:15So they're like, well, okay, but do I really own the company? Well, then you look at the contractual structure, which isn't disclosed. There's no public disclosure of the underlying agreement. That agreement probably says we own all the intellectual property. If you don't work your ass off, you have to come clean windows at Mark's house and a whole bunch of things like that that really effectively make you own the company. I also know that the investors in scale are distributing the capital. It's not disappearing into the corporation. It's going to the shareholders and getting distributed to the investors in the company.

29:47So it's truly an acquisition. There's a coming wave of technological convergence as AI, robots, and other exponential tech transform every company and industry. And in its wake, no job or career will be left untouched. The people who are going to win in the coming era won't be the strongest. It won't even be the smartest. It'll be the people who are fastest to spot trends and to adapt. A few weeks ago, I took everything I teach to executive teams about navigating disruption, spotting exponential trends a decade out and put them into a course designed for one purpose to future -proof your life, your career and your company against this coming surge of AI, human oids and exponential tech.

30:27I'm giving the first lesson out for free. You can access this first lesson and more at dmandis .com slash future proof. That's dmandis .com slash future proof. The link is below. So, Selim, I'm curious, you know, you and I both have spent time with Jan Lekun, who previously was heading AI at meta, and now Alexander Wang comes in. Alexander, I guess, Dave, he was a freshman at MIT, dropped out after his freshman year at a start scale. AI becomes, like, was he the youngest billionaire at MIT? Oh, yes, yeah, yeah, by far. And now he's gonna, I wonder if Jan is gonna stay on at meta. So any thoughts there, Selim?

31:14I think well, clearly there's a changing of the guard there. And the, whatever they feel, they're deficient, they're trying to leap frog, and they're doing it very, very aggressively. Something that I love about scale AI, it's really attacking the heart of the problem, which is attacking of data. And if you have that, you can solve the garbage in garbage our problem in a really powerful way. And then it means you can use much better models to, the models you use become much, you can use lesser models because you have much better data. I mean, I think Yadlaku and just bring it back to that. And he's a super brilliant sweetheart guy at the center of this all.

31:53But he's had a much more conservative point of view on AGI and ASI. It's the same with Jeff Hinton. Giannis is kind of in that camp of being, everybody needs to slow down and be really, really careful with what we're about to unlock here. Yeah, I think Mark is an engineer at heart, all these guys are engineers at heart. They're not trying to buy an AI philosopher. They're not trying to buy a lot of the people that are the senior AI leaders from the big labs are saying, look, there's something fundamentally missing from these transformers. They're not actually reasoning. They're just brute -forcing their way to intelligence.

32:31They don't want to buy that. What they want to buy is I know how to make this algorithm work on a million concurrent GPUs. I know how to change the algorithm so that it stays synchronous across all this massive amount of compute. I know how to actually deploy the transfer algorithms that the Swigloo isn't working. We need to go back to Reload. Stuff like that. That's in the minds of these mid 20 -year -old geniuses. That's what they want to buy. And so it's interesting to me it's normally the older, you know, kind of highly successful, you know, Eric Schmitz have all the money and the young people have all the brain power.

33:08But here the young people have the brain power and now they suddenly have a lot of money too. So that's a new thing in the world as well. Well speaking about brain power and money, And, Masasan, one of the old guard investors has pitched a trillion dollars. He wants to replicate Shenzhen scale within the U .S. Let's take a listen to this video. I think the $1 trillion worth of investment of soft banks, but then the context for us. I'm trillion dollars. And he wants to recreate a kind of Shenzhen in the U .S. potential alongside TSMC, of course, the foundry and, of course, Samsung as well. You would imagine that OpenAI would have a piece to play as would ARM as well, that is moving closer into data centers, into their CPUs, aligning with AI accelerators.

33:57So it hits that, and it ticks that box in terms of Trump's ambitions, but we do need to find out where the capital is coming from, where the spending is coming from, and whether, indeed, they can get the talent and the engineers not just to build all these projects, but actually to operate them as well, which has been a constraint and a bottleneck in the US. So, have you guys been a Shenzhen? I've been there a few times. Oh really? So, yeah, years ago. Yeah, I mean, it's changed in the last five years. I mean, I was there between 2014 and 2019. And it was an incredible hotbed. I mean, it was an engine of innovation.

34:33The old mine, the mindset there was nine, it was nine, nine, six was the best lifestyle you could have. 9 a .m. to 9 p .m. six days a week. And people talk about trying to replicate stuff. There was a lot of entrepreneurs creating very new ideas out of there. But it was basically a convergent mecca for technology. And the idea that Massasson wants to rebuild that here in the U .S. I find that fascinating. Thoughts? Yeah, I think part of that vision doesn't align. And when we were at OpenAI, one of the questions I was asking D Scully is the talent pool, the computer science talent pool in Boston is about 20 times bigger than in Silicon Valley.

35:14And it's also not nearly as picked over. Why does an OpenAI open an office in Kendall Square, just like Google did in Microsoft did? And the answer is, yeah, we would do that except the timeline to AGI is so short that we're going to have a multi -billion dollar or multi -billion person AI workforce before we could even finish the building and populate it. That's a pretty interesting insight. Wow. It blows my mind. So then you're like, okay, well, Shenzhen, that's a huge number of people, buildings, you know, but is that timeline going to line up with the Elon Musk video that we saw a minute ago?

35:48So you know, I think the constraints here are electrical power and chips and not so much building a huge city that's all working on it. It's the 60s, but he digitized, dematerialized, democratized, demonetized, you know, and and disrupt.

36:12Here's, this is a chart near and dear to your heart, Dave. of the fastest SaaS growth in history, $500 million of ARR in under three years, blowing away and thropic and Uber and OpenAI, talk to me about this. Well, this is so inspiring for the teams in the office at Link Studio. So, you know, Link Studio, now we have 26 teams, MIT, Harvard, Northeastern, and this team, these are starting up companies that are being incubated at links. Yeah, I mean, they're exactly and they're culturally just like cursor, you know, like three, four, five best friends from school, brilliant but never operated a company before, building something with AGI or AI that's groundbreaking.

37:00And so they see a company like this thriving and hitting a huge valuation, but also, you know, back when this happened in the internet era, you got huge valuations, but the companies were very fragile because they didn't have a huge amount a revenue. These companies 500 million of revenue, the margins on that must be astronomical. And so they're raising a lot of money at a big valuation, you know, greater than 10 billion ish. But they can actually operate profitably, you know, on one day's notice if they want to, because they're not headcount intensive. So these are like the best companies financially that we've ever seen in history and then the timelines are just laughable, like two years to get to 500 million of revenue.

37:41How many cursors are out there in the next couple of years? Uh, dozens. Dozens. It's actually constrained by the number of teams, not by the number of opportunities. So it's fascinating, right? We have constraints on electricity, on chips, and on the smartest entrepreneurs who take this forward. At least for the moment, it's humans that are constraining. Well, I mean, the difference in the vibe around Boston versus any time I've ever seen is just so blatantly obvious and palpable. You just need to walk around, but everywhere you go, everyone's like, you know, just talking about scale AI, talking about cursor.

38:14These are, you know, they're fellow alumni that they actually knew. Yeah. And so, you know, the jealousy factor is a great motivator. It's really an amazing time. Selim, and these are all exponential organizations. All EXOs, they have an MTP. They're using community effectively. they're building developer communities, the engagement levels are really great. They've gamified in many cases what they're trying to do. It's phenomenal to watch. We predicted this in the book, right? We said we're going to have just a continuing increase in the velocity and scale and speed. I mean, this is surprising even to us at some level because the speed of, I mean, 500 million ARR in this time scale is just unbelievable.

39:00I do agree with Dave, there's a lot more coming down the pike on this and these curves are just going to get more and more vertical. The teams is a really intriguing problem. How do you find the right teams? And I'm wondering if you could use an AI solution to find teams that can then be put together and thrown together for this. That would be a really interesting problem. Dave, you do that. I mean, you know, one of your billion dollar, one of our billion dollar investments is Mercor. that is all about finding and hiring. But is that for the general employee, what are the attributes of the founding team that you're looking for?

39:39Yeah, great question. And we study that all the time. We quote the Fred Wilson rule a lot. We call it the Fred Wilson rule. Fred didn't call it. He's the Union Square Ventures founder, MIT alum, most successful venture capitalist of all time, numerically. It keeps a low profile, so we don't talk about them every day, but Fred Wilson is really a god of the industry. But what he says, as he gets older, is I always invest in teams of three or more best friends who write the code themselves, meaning they're technical. They're really technical. All three of them or more. And I trust them. And if they pass those three filters, I invest even if it's the stupidest idea in the world, because they'll change the idea much more quickly.

40:18You can't change friendships. You can't change relationships. You can't change yourself overnight. but you can change your idea overnight. And once you get them into an ecosystem of other people that have great ideas, take them out to Silicon Valley, introduce them to Eric, bring you all some, take them to HAI, take them over to OpenAI headquarters, run them through Google, and we're doing all that with these teams now. Then they come back home and they're enlightened and they always have good ideas at the end of that. Let me hit on one of the points there. I mean, people say, why should they be best friends?

40:47Why should they be around having had a relationship for a number of years? If we just saw these large companies like Meta and Google and OpenAI are just rating companies and stripping out the talent. If you've started a company with some stranger that you don't know, and it's been six months, and someone gives you a huge signing bonus, you're going to leave. But if you've started a company with your best friends and you've got long history, you're not going to abandon them. I think that's your right. That's exactly right. actually for companies is that somebody bails because you'll always succeed in the end if you stick with it.

41:26So the way you characterize it is it doesn't talk to you. You'll give it a dozen times and you'll look, you know, name any one of these companies that didn't pivot at least once, you know, going back to PayPal and every one of them, you know, pivots at least once. And so that's just part of the journey. But when you pivot and then someone says, oh, I give up on leaving, that's what ends up killing the company. So also the way I've been phrasing it for many many years is more true than ever before Imagine that you're on an international flight and you're sitting right next to somebody in a middle seat The way you feel when you get off that flight That's the way it's gonna feel when you're doing a startup together So you know if it's you and me and Celine flying we're gonna come off that plane Energize because we've been talking about everything in the world for hour like you know eight and twelve hours Yeah, not only that movement will have infected the three rows around us all get into a conversation Yeah, walk out with more employees than he started with.

42:20Yeah, Selim, when we had Singularity University's graduate studies program, the GSP going, and we were starting companies that had a 10 to the 9th -plus mission, right? Impact a billion people over a decade. And we were starting companies. It was around the same exact time frame that Y -combinator was getting going. And the failure mode, I think, was that we thrust 100 alpha males and females into a room, independent of each other, and said start a company. And that was very different than why combinator where teams came in with an idea already. And that glue pre -existing with something that they're all passionate about, I think, is a super differentiator for investments.

43:06And if you look at the track record, the ones that did succeed, but the ones that became friends and stuck together over time, the one thing we did do was created lasting friendships, there were lifetime long. And so if you look back, a lot of those alumni have gone and started working together with where they found affinity, not necessarily on the teams. That team formation is a critical one and that early chemistry is really important I remember this whole conversation reminds me of Yosey Vardy who kind of single -handedly created these release start -up scene Yeah, and he sold I see cute then became a well -in -summechner for like half a billion dollars back Remember, oh well and he did something amazing He basically went to founders in in Israel and said if you're a good guy and you have integrity I'm giving you 50k That's the bar And then you just trusted them and you would check their integrity and their character very carefully and then you just give them money And you invested in something like 400 startups and the outcome of those has been a little bit like the Fred Wilson type It's just been off the hook so the the team and the individual that you're betting on is everything in Selim you're so right and you're inviting me to something that's really really important Peter remember when we went over to Israel to Tel Aviv to start up nation to try and figure out why the startup success rate is five times higher there than anywhere else on the world per capita, than anywhere else in the world.

44:27And there are a lot of reasons, but a lot of it comes back to everyone has to do their military time and there's a huge amount of bonding, you know, just marching through the desert together and suffering together. And that creates these lifelong friendships. Then you go to college and you appreciate it a lot more. And then you start your company while you're in college. And so they're a little older, but a lot more bonded when they're going through that experience. But if I port that back to the US, you know, MIT is absolutely thriving. like I've never seen before in terms of startup success, but Daniela Rousse, who runs C -Sail at MIT, because day I live in the world, she has two daughters, one went to Harvard, one went to MIT.

45:01Her Harvard daughter was constantly at MIT for the parties. And nobody thinks of MIT as a party school, right? Why would you? But actually, when you're there, it has an immense amount of bonding. Part of it is because the way it's set up with the living groups and the fraternities and sororities. Part of it is because the school is so freaking hard. And that's like the marine. You cannot get through on your own. There's problem sets, you know, all night long with your best buddies trying to get cancer. Just a plug here for Waterloo, which is the MIT of Canada. We have the same thing you couldn't get through unless you collaborated really closely with a bunch of other fellow students and that created lifelong friendships.

45:39Really great point. Yeah, well, if anyone's listening out there in school administration, you know, Harvard has a little bit less of that bonding culture because the school's so stupidly easy. You know, everyone says it, Mark Zuckerberg, Alexander, everybody says it. And it also doesn't get into harder to fail out of. Hard to fail out of. And then Stanford has become even worse. Stanford is, you know, if you talk to the students there, they're like, where the hell is the crazy, fun, bonding, culture. But one of our Harvard guys in the lab decided he was going to open a window and do a rock climbing drill on the second floor down to the first floor in the brick wall.

46:16And so there were cops all over the building and security guys running around and they're like, Dave, why are the cops all over the building? And I said, guys, let them be. This is what they need. They need the bond. They need to blow off steam. They need to be a little crazy. This is what's going to create a success in the long run. But you know, we also can't have the cops here every day. But this is the culture that is ultimately going to thrive because it's kind of lacking on the Harvard campus and they need to create it. And so they are self -creating it. All right, this next slide from Andreessen Harowitz is pretty epic.

46:49It's labeled what's working means in the Arab AI apps. Gen AI startups are shattering growth records. Dave, this must make you feel pretty amazing. Yeah, this chart's a little hard to read, but if you look at the top quartile, it looks like they raised less money, but they actually raised it much more quickly. So if you look in the bottom right corner, pre -series, $8 raised, $3 .1 million. and that means they were very, very capital efficient, getting to 8 .7 million in revenue run rate. So this is what I was saying earlier, the fundamentals of these companies are so good compared to the internet era.

47:22I mean, very capital efficient, great ARR, and this is accelerating really quickly now because did you see that? You know, one of our companies, Fart site was talking to JP Morgan as a customer and nothing was happening for months, you know, just unresponsive. Then Jamie Diamond sent an email to everyone in the entire company, every manager, saying, if someone is trying to sell you AI, you better buy it or at least listen right now because this is going to happen. And the oldest suddenly they called back, they, JP Morgan, actually reached out to far side and says, okay, we want to talk, get over here right now.

47:54So that's going to happen now across, you know, most of the Fortune 500, all of the mid -market. So this will get even more traction very quickly now. I just, I love, these numbers are extraordinary, right? AR 8 .7 million time to a series A in five months. Yeah. Extraordinary. I mean, there's a crazy good numbers, but then look at the cursor number from the priorsled five or two years. I mean, it makes things like that week, right? Yeah, look at the bottom quartile there, though, right? Yeah, three. They've reached 10 million in series A and in six months or 12 months, they've brought back a third of it.

48:33That's still an amazing number. A great point. It's a great point, so they have 3 million in 12 months would have been top desisl. You could be here, but I hear it's bottom quartile. That's a great point. Yeah, an acceleration of the acceleration. Here's a big story in AI this past week. The Trump administration is launching AI .gov. They're hoping to launch it on July 4th. I hope they hit it. And it's going to dig into this a little bit for those who have been frustrated by the government. This is a project being led by a Tesla engineer by the name of Thomas Shed, who's leading the team. And the idea is, can the government use AI across federal agencies, the GSA, DOT, FDA, DOE, FAA, all these agencies, which have been sub -linear in their existence at best.

49:29And let's chattel bit about this. So GSA, which is General Services Administration, it buys everything for the government. They could use AI to optimize procurement, get vendor performance, automate contract analysis, really eliminate fraud. DOT is gonna be predicting flight delays, analyzing real -time vehicle data, helping support infrastructure like roads and bridges in advance, wouldn't be great if they could predict where the potholes are and get those fixed. DOE about optimizing grid ops, forecasting demand and supply. The FAA, we're going to see a story on this about automated drone traffic management, weather avoidance.

50:14And just, you know, as a pilot, the FAA's air traffic control system is a bloody, you know, 1950s mess. And then, of course, we've spoken about the FDA using AI to enhance drug, device approvals, faster clinical protocols, optimizing food safety. I mean, if there's one part of the world that needs optimization with AI, it's the government. Yeah. You know, a great roadmap for how this works too. I think Palantir and AWS, because everyone was worried about, you know, how is the government going to interact with cloud computing? You know, there's a huge privacy issue here and is the government going to start building their own data centers and build their own cloud and obviously they don't know how to do that.

50:59So then Palantir and AWS set up secure clouds, private clouds for the government and that became the roadmap. So now with AI, it's like, well, I obviously can't take all my government documents, tax returns and everything and dump them into Gemini or into chat GPT. Like, how's that going to work? So now, if I just explain people why you can't, why you shouldn't do that, why you can't do that? Well, first of all, there's no compartmentalization. So it gets pooled into the training data with everything else. You know, everyone asking about what times a soccer game gets pooled in with someone's tax return goes into the training data.

51:29Then somebody else who queries chat GPT says, hey, what a paid Peter D. Amandas' taxes look like? It just answers. So that's not going to work. So yeah, all kinds of concerns like that. But it's going to be figured out in the private sector and it's going to be sold to the government as compartmentalized AI modules. There's a lot of questions around whether departments can pool information and share their AI. So those are really tricky conversations, but I guarantee none of the ideas are going to come from the government out. What will happen is mandates will come out. It's what the state of New York just did.

52:02The governor of New York said, you know what? We need a gigawatt of nuclear power. Okay. Any ideas on how to do that? But no, I'm just saying make it happen. And then every private sector genius can propose a way to do it. And then they'll just approve one of them and that's what will happen. So the same will happen with AI here. So hopefully the big AI companies are aggressive in building up their government services operations or they bless some other third party like a volunteer type or a new startup to go and become that entity. But that's the only way this can actually happen. And God knows we desperately need it, right?

52:35AI can solve so many government. Oh my God. So quickly. Yeah. So Liam, you've been working with governments around the world with your EXO hat on. Speak to this, please. I have so much to say here. Okay. Three quick points. One, most note that most government processes are prescriptive. And the many other prescriptive repetitive process, you can apply AI to it and totally change the game. So I think that's a huge area. Second, about a few years ago, I was asking you to talk at the Republican National leadership convention and the title of my talk was going to be how do you drop the caustic government by 10X?

53:10And you could do it easily using some of these technologies, blockchain, AI, etc., etc. The third point, I'll give a specific example. If you were applying for a wind turbine approval in, I think it was in Colorado, it was taking like two years or three years to get approval for that, right? And then they brought in a programmer who put in a on a Google Maps, where the electrical mains, where the water mains, where the, one of the flight paths, and they were able to reduce that to your approval time to 30 seconds. And that's just the smallest example of how you can do this across the board. And we've mentioned some of these already.

53:45It's going to be a game changer. I can't, I'm so excited about the potential government applications of this. I love it. I love it. And it is a quick aside. You've probably heard me speaking about found life before. And you're probably wishing, Peter, would you please stop talking about found life? And the answer is no, I wouldn't, because genuinely we're living through a healthcare crisis. You may not know this, but 70 % of heart attacks have no preceding pain, no shortness and breath. And half of those people with a heart attack never wake up. You don't feel cancer until stage 3 or stage 4, until it's too late.

54:18But we have all the technology required to detect and prevent these diseases early at scale. That's why a group of us, including Tony Robbins, Bill Cap, and Bob Hooray, founded Found Life, a one -stop center to help people understand what's going on inside their bodies before it's too late, and to gain access to the therapeutics to give them decades of extra health span. Learn more about what's going on inside your body from Found Life. Go to foundlife .com slash Peter, and tell him Peter sent you. Okay, back to the episode. Here's a related story. The US Army appoints Palantir Mehta Open AI execs as Lieutenant Colonel's.

54:56This is a special unit created to support the government. Fascinating. I'm going to give some names here because they were published. The appointees include the Palantir CTO, Shyam Sankar, Meta's CTO, Andrew Bosworth. Kevin Wyle, the OpenAI's chief product officer, Kevin's gonna be joining us on this podcast and the next one for that. Can I move on to that? Yeah, and Dave Unigh had an amazing meeting with Kevin up at OpenAI headquarters and then Bob McGrew, former OpenAI chief revenue research officer. So I find this absolutely fascinating. It's sort of indoctrinating and actually they made it super fast.

55:46There's no required, you know, traditional training, no boot camp for these individuals. What are your thoughts? Peter, you didn't read the quote there. The backlash quote. Okay. The appointment of Lieutenant Colonel in the U .S. Army followed the creation of a special unit created for rich big tech mavens seeking military leadership roles. This is like exactly what you're always saying. Everything turns into a drama. They're whether it needs to be or not. That's just the nature of social media. I mean, this is one way that the government can bring in extraordinary intelligence that they could never hire, they could never recruit otherwise.

56:29I mean, this is sort of a part -time military service to make sure that the US government and the US military have access to the brightest minds. Yeah, exactly. And then I don't know the other guys personally, but Kevin Wilde, we know. And just swing our guy, brilliant. Perfect guy. Yeah, absolutely. And you know, is somebody gonna just naturally join the army as a private work their way up and end up being aware of how to use AI to solve government and military issues? No, that's not likely to happen. So go get the best guy on the planet. He's absolutely the right guy. I mean, just he's a physically impressive manager.

57:06He can actually move mountains while still being the nicest sweetest guy on the planet. And he knows exactly how this stuff works. Like, this is just great for everybody. I don't know. The negative spin here is nutty. I think this is a great example of a human being plus AI because as they bring AI to help in these roles, it's going to be totally transformative. You of course have the monster immune system response with people going, well, you can't do that unless you've worked your way through the ranks, et cetera, et cetera. And people have a thing, but I think this is a great application. This reminds me of the big problem of around leadership training.

57:42Right? And we have, we've spent decades and dozens of hundreds and thousands of books written on leadership training. And then about a few years ago, it turned out the best leadership training in the world was World of Warcraft. And the fact that technology can outstrip this age -old, human kind of institution is unbelievable, but it's there. And I think that added to what these guys can do, plus bringing technology and their mindset to the mix. This is where I think you'll have the biggest impact because they'll bring that mindset to, and hopefully, infect the rest of the armed forces with it.

58:15Yeah. All right. Talking about sort of breakthroughs in AI, I love this. My hats off to deep mind continually to push new capabilities out that support all of humanity. So this is a deep -mind algorithm supporting better tropical predictions for cyclones. Let me just play the video here. It's no sound. But let me give the data. So it's a five -day track prediction that averaged 140 kilometers closer to the actual storm path. It's a difference between hitting Florida and, you know, and Georgia or Virginia. This was trained on 5 ,000 cyclones over 45 years. Here are the numbers on impact. There's about $1 .4 trillion in economic losses for cyclones over 50 years.

59:09And I'm excited about this. Thoughts? Yeah. Yeah, I mean, it's, it's, you know, there's a piece of AI folklore called the bitter lesson, which basically, anytime you throw a lot of data and a lot of compute at one of these algorithms, you're likely to get a great outcome. You can sit there and stare at a wall trying to think through how to do it with different equations for three years. You're not going to compete with the big data approach. And there's a great case study. I bet the people working on this got it cranked out in a very short period of time with just a couple of people, yet it's far more effective than anything that's been done over 50 years of weather research.

59:44So there's so many of these around. It's just the benefit to humanity if we coordinate it and wrangle it correctly, is just immeasurable. And so it's a great example. Suley, what are your thoughts here? I label this as nothing to see here. And I don't mean that in a negative way. This kind of thing should be completely expected. You take an ancient data set where we have human beings trying to hand plot these things, which are never going to do that well. And now you throw AI at it plus the rich data set that is very bounded and we know exactly the history. Of course it's going to come out with a much better thing.

1:00:22And thank God, thank God because look at the predictive ability now going forward, huge impact. But I think we should take this as we should expect like a thousand of these coming out in the next year or two or three years. Yeah, I agree. These would have been great ex prizes as well. And I've been pushing for this. I think DeepMind is an extraordinary company under Dymus Ashabis. and they're creating these kinds of assets to support humanity is really in their DNA, in their culture. I can't wait for an earthquake prediction, X prize or an earthquake prediction algorithm, right? I mean, if you could predict an earthquake with a, instead of like 30 seconds or a minute, with 10 minutes or 30 minutes, getting people into safety would be huge.

1:01:07I mean, one of the interesting things. Wait, can I just drill in on that? Sure. That's a perfect example. Like we know animals can sense this exactly. The data is there. The data is there. We just have to get the right kind of algorithmic approach to it. And that's an area where I would expect to see a breakthrough and something like that for where the, and then when it happens, everybody is going to know, oh my god, this is unbelievable. But we should expect things like this. In fact, we should take areas and go find them, find areas where we have that we know what the answer could be. We know definitively it's possible and then put AI against that.

1:01:38Yeah, my guess is we'll see earthquake prediction algorithms within the next two years if not sooner. Here's an interesting controversial thought on this. Imagine if you could control the direction of a hurricane. So you instead of having it hit Miami, you steer it down into Central America. Oh my god, why would you possibly do that? That's terrible. You know, well, so if you hit Miami and the cost of the impact there is, you know, $50 billion for that. And the government of Costa Rica says, listen, you pay us $20 billion and you can land the hurricane here. An interesting arbitrage on geography, crazy idea.

1:02:29We have people who control the path of these things. Do you know the mechanism that they'd use for that? Uh, I mean, butterflies. A butterfly effect. I think he'd use lasers and heating the atmosphere. Maybe it's, uh, it's magic, voodoo dust. I don't know. I mean, I can just see the other side of that coin, right? Hey, Mr. Trinidad, you maybe you want to pay some money so that we make sure that hurricane doesn't hit you. And you get an ulcer, it's her crazy outcomes. But if you can measure it, you can impact it. And I find this again, huge and interesting implications. Okay, our next story here comes from Mattel and OpenAI.

1:03:13They've announced a strategic collaboration. I've talked about this forever, super excited. Your toys are gonna become, you know, super intelligent with GPT -5. So your Barbie doll, your hot wheels, your American girl, I know that Selim that you in particular like the American Girl Dolls, Thomas and friends, sorry buddy. That's okay. You won't cover my deep secret. I think this is going to be a boom for the toy companies. And, I mean, this is going to enable rapid, you know, early education of our kids. That's the area I'm really excited about because the feedback loop as you have interaction with these toys, you'll learn a lot about the child and we can use that to for understanding learning behavior, guardrails, you could implement where their motivations are.

1:04:06I think it's so exciting because we'll get more data about young children than we could ever gotten before. Yeah. I was a little surprised OpenAI wanted to touch this one. It's really clear when you're talking to the AI voices now that they're within a year going to be just crazy engaging super, super friendly and a lot of kids are going to prefer talking to AI all day than to talking to real friends. And you know, there's good and bad that comes along with that. I kind of loved every minute of raising my kids and I hate to see that change in anyway, but it's clearly coming soon and it's inevitable.

1:04:41The other part of Dave is sparking their kids imagination, right? When you're, when you to make up what your $10 Barbie doll is saying, that's critical for fostering early curiosity in imagination. It is. And you have the echo change chamber risk on the other side of that. So if it's done right, it's an educational gold mine and the kids are happy and a lot of schools are terrible. So you're alleviating a lot of that. So if it's done right, it's incredible. If it becomes an echo chamber, then you can see where it can go bad and a real hurry to. That's why I'm surprised OpenAI wants to touch it because when you start talking about kids, you really got, you cannot make a mistake, right?

1:05:25You got to get it right. Yeah, there was a friend of mine that had a product called Moxie, which was an AI robot. And it was mostly being used for young kids with educational challenges, right? neurodiverse kids, in which case, you know, creating a best friend and helping them open up and communicate, there's real value there. What about AI enabled Chuckie? That'll be interesting. A whole new set of movies coming out. All right, let's jump into a little bit of AI and education. These are some scary reports that came out. So this is in Time Magazine, in chat GPT, maybe a road in critical thinking skills according to a new MIT study.

1:06:09Dave, did you track this? Yeah, well, only because you put it in the slides, I said, I better understand what's going on here. This sounds really, really important. So I dug up the research and read it. And it's nothing surprising if you think about how ways works, right? A lot of people don't know how to drive anywhere unless they turn on ways, like places they go every day. They could not get there without turning on ways. So it becomes a crutch really, really quickly. So that's what's happening here with writing, you know, where you would have thought through all the underlying topics in order to write it because the AI is filling in the blind spots.

1:06:41You just don't really understand what you just wrote, but it's not it's not at all surprising. You know, it's that when you write it up and put it in a headline, it opens your mind to what's going on. But when you read the paper, you're like, oh, duh, of course this is exactly how it's going to work. Yeah, this is some of the data. I don't know if you want to use this to recount what the study said. Yeah, well, no, it's really straightforward. If you write a document yourself and you have to think through every single word of it, that time that you put in means you can then recount what you just wrote with incredible accuracy.

1:07:18So, you know, the failure rate on the top line shows your quoting accuracy of what you were just talking about. So if you say I'd write the same paper and then you immediately ask you, hey, what was Shakespeare's favorite toy? I have no idea. Well, you just wrote it down like, oh, did I? Yeah. So that's the difference. So if you're a failure rate, if you use chat GPT versus 11%, if you're using Google meaning you're actually looking up the data, then you're composing it. I mean, when you're doing the writing, you're doing the research and doing the writing, you're effectively training your own neural net.

1:07:51And the data is being deposited in your brain. It is scary. It's going to become a crutch in terms of thinking. And it's going to get a lot worse. It's lame. I didn't read it as all bad though. I think that you got the work done 100 times faster in the left column. Sure. So you're normal that actually didn't have time to retain every little detail, even if, I don't know, if society's going to move 100 times faster, we're not going to retain every detail. It's just that simple. So, yes, as a teacher, you could say, look, the kids are not really learning this stuff, but as a person moving through life, the kids are covering a lot more terrain, isn't that more important?

1:08:37So it's a mixed bag, you know, it's not all bad. Selim, good or bad, what are your thoughts? I have an 80 -20 approach, 80 percent unnerved, 20 % will navigate this. So the 80 % is I actually saw this with Milan my 13 year old. He was writing an essay and he just used Chattu PT to write the essay and he clearly had no memory of that essay. He would have fallen completely into these buckets, right? And so when I saw this slide, I was like, whoa, this reminds me completely of what Milan just went through. And he has no cognitive framing for what he wrote in that essay, okay, because he used the AI to help.

1:09:12And so there's part. Now the other side of it is it's happening much faster, et cetera, et cetera. I think the key question is how do you effectively train kids on critical thinking into the future? And a guest we might want to think about is Nicole Drisky who's actually solved this problem and has found a way of teaching critical thinking into kids in a very active and a very accelerated way compared to where we do it. The last point I'll make is that I remember seeing a study that 52 % of the CEOs in Silicon Valley are liberal arts majors, right? which is the ability to think in different ways is a critical factor of success in leading a tech company.

1:09:48That's really a fun, that really interesting. It is interesting. It is interesting. There's an algorithm as a different spin on that the liberal arts majors succeeding is more tied to their desire to not do irrelevant difficult things and get to important topics. And it's just an easier way to get through. It's a good filter. It's a good filter. It's a good filter, either way. David, Selim, I don't know if you saw Andrew Kaparthé's presentation at the AI Start I showed it to my son, Jet, yesterday trying to incentivize him about vibe coding, which Andre came up with. He put out the tweet that went viral, defining vibe coding.

1:10:26And my son's reaction was, I want to learn how to code, not just vibe code. So I'm curious what you think about that. Because the concept right now is English is the new coding language. But there's a lot of value in fundamental coding. So what are your thoughts, Dave? Oh my God, so many thoughts on this. I have a little story, amazing experience this week. I don't know if you want to want to hear it. I do want to hear it, of course. Yes, you do want to hear it. It's incredible to me. You remember, right when I got out of MIT, went to MicroStrategy, came back to Boston, started my first company, Data Sage.

1:11:00Our very first product was using neural networks for handwriting recognition. And so I took the back prop algorithm, of them, you know, read the raw research paper, all the differential equations that I got to try and code this up on real -world hardware and assembly language. From the day I started on that journey until we productized it, was four years of coding. Wow. And then that turned into a few million of revenue and then we just skyrocketed from there at all. Well, then a million dollar exit, one million dollars. Did you say you could have done this? Did you say you could have done this assembly?

1:11:28Well, we had to because so, you know, we started out in a high level language but you needed to squeeze every lip, you know, every flop out of these processors to build anything scalable enough to work. So we invented quantization, which is now all the rage to try and shrink the parameter size, anything to get another 2X performance out of these things just to make it work in a real -world use case. And so it's a lot of hard work. So then this week on Monday, I said, I wonder how long it would take me to recreate that four years of work. And so no joke. I'm absolutely not exaggerating. It took less than an hour to vibe code it, front scratch, to the exact same...

1:12:06Even the demo, the demo graphical interface I put on it. Vibicoted the entire thing in under an hour. It's not entirely apples to apples because there's a ton of open source out there that the vibe coding can pull in. Just to be fair. But in terms of getting the job... The broader point is well made though. Yeah. Yeah, four years down to an hour. It's just mind blowing. What you can do. Now, your son is exactly right. Spend some time looking at the code, writing some raw code. You don't realize how much faster you are until you try and do it the old way. And so it's really, really important to get that experience.

1:12:42So let me give you the end of this. He went off and wrote a short story, kind of full without any help, etc. And it was mind -bogglingly good. I couldn't believe that he used an AI to write the short story, but it was really, really good. This is your son. Justin, you're holding the air. It's like right now, the AI can do almost anything for you, but it's not creative yet. And so you still have to think, the human component is still by far the most component. Now, I don't know if that period of time will last forever, but right here right now is such a golden era where you're empowered, but not demoralized or crushed.

1:13:19It's just such a wonderful next couple of years. You really got to take advantage of it. Our next topic here is AI and job loss. This was a Stanford survey revealing which jobs AI would most likely replace. They surveyed 1500 workers and AI experts. 69 .4 % want AI to quote, let me focus on high value work, unquote. And 46 .6 % wanted to take on repetitive junk set. That's kind of obvious. We'll put this study in the show notes, but here's the occupations most likely to be automated. No news here. Bookkeepers, payroll clerks, data entry, insurance claim processors, software roles, tax preparers, public safety telecom.

1:14:09Dave Selim, any thoughts? Well, high level thought is, everybody needs to become a user of AI to get ahead of this. And the study would say, wow, it looks like brick layers are going to be immune for a while, but you're not going to go and become a brick layer just because you've got three more years of, it doesn't really give you any actionable robots. Robots are coming for that job too. Yeah, exactly. So don't do that. Just start using it every day, understand it, and ride the wave. Let's double down on that. If you're listening to this podcast and AI sounds fascinating, you're not a power user, how do you start?

1:14:48Selim, what do you start with? Oh, just take a task that you're trying to do and go, AI, how would I do that task and then say do it for me and give it the raw data and watch it just go. It's pretty much is that easy. And I love the point you made Dave earlier, which is I do use chat GPT voice interface. And when I'm doing my red light therapy or taking a song or whatever the case might be, or driving, I'm having a conversation on whatever subject is I'm curious about. And it's extraordinarily educational and fun to have this back and forth with an AI saying, well, I don't understand that term, could you dive in or what's the data that backs it up or when did that happen?

1:15:30I mean, just being able to have a continuous, you know, it's what a child like memory or experience of why, why, why digging deeper. That's exactly what you should do. And you know, get out of the media rut. I know Peter, you say this a lot. But you know, we have the internet now. You can actually watch useful media like this or you know, study KJ Hardrich and his podcast, he's phenomenal. Watch Lex Friedman, watch Dwarkeish Patel. But while you're doing it, if you don't understand anything, have either Gemini 2 .5 Pro or Chatchy PT 4 open and just talk to it while you're listening to the podcast, stay out of the mainstream media.

1:16:11Like do not listen to the rock stars, sports broadcasting, whatever, it's gonna distract you and suck you in. You need that time back and use that time this way. Once you're into it, it's just as much fun, but much more useful. Can I make a couple of points about that last one? Of course. Let's note that a lot of those roles are being done because people have to do them, not because they wanna do them, right? It's grunt work done repetitively, et cetera, etc. And it's perfect. It's a perfect area. I was really happy to see that a large number of folks, 40, whatever percent said, I want to take all the repetitive tasks because nobody wants to be doing that anyway.

1:16:48And now we can automate a lot of that side of it. And just a quick point out the bricklaying thing. I remember showing a drone at senior larry university a few years ago, where you had drones working in cohesion, delay bricks on the wall. And the drones did it in like no time flat because they didn't know it was, we know exactly where the bricks need to be laid. It's totally prescriptive off you go. Yeah. This is a story from the Guardian, Amazon testing humanoid robots deliver packages. Took them long enough, right? This is, we see in the image here, agility's digit robot. I'm going to have the CEO of agility at the abundance summit with their robots.

1:17:26Actually, I'm going to have four or five robot companies at the abundance summit in March this year. You can learn more at abundance360 .com. But I was a little alarmed when you read, it's going to spring out of the van. That's going to be a little unnerving. It's how my two dogs are already freaked out by the postman. What the hell did they do with this kind of thing? I mean, come on guys, we're going to have autonomous vans driving around where robots do the last 10 meters of delivery to your doorstep. And it's just going to drop the cost of this. So we're going to see drone delivery of products.

1:18:01We're going to see you, you know, van or autonomous van and robot delivery of products. this is happening. There's no question about it. It's the when not an if agrees. Right. And so the question is when when do you predict? I'd say middle of next year because the technology is all there. They just have to get there's probably some regulatory stuff to get through which might slow down But the technology's potential is now there now. Yeah, the technology is there. I think the humanoids are inspiring everybody There's no surprise here, but but you know what people don't talk about as much as the robotics that are doing nano surgery micro surgery or unbelievable.

1:18:36And also the robots that are crawling through pipes, cleaning things, you know, getting into sewer systems, those are also taking off. They're not as sexy as the humanoids, but it's all happening concurrently. And it's just, you know, tremendous benefit for humanity. Yeah, I want to make a point about humanoid robots. You know, we've had this long strontment discussion where I'm sitting. I tired of your point, you're making me nervous. Hold on, hold on, hold on, hold on. I thought of a great real world example of my octopus idea, which is, you've got a human or robot. How many times are you doing something?

1:19:08Do you wish you had a third arm to hold the garbage bag open or whatever? So please have these human or robots have three arms. No, we just have two robots with forms. Anyway, so but here's interesting. We're going to see these companies stack resources. So I would not be surprised to see Tesla get into delivery services, right, with autonomous vehicles and opting through bots. We'll see obviously here Amazon and agility. We'll see other companies coming coming together on this, but a full stack in the physical world. Let's talk about robotaxies. Big news since we spoke last on June 22nd. The Tesla robotaxie launched in Austin with a flat fee of $4 .20 cents.

1:19:59Elon loves his 420 over and over again. So Robotaxi is now live. Here is Elon at Tesla headquarters in Austin. And here's a quick video of what the fan has an experience in Robotaxi.

1:20:22Thoughts finally he's done it. I mean, I think it's the biggest one of the biggest markets. But that Tesla is going to experience. We've seen Kathy Wood predict as a multi trillion dollar marketplace. Tesla will have been known as a car manufacturer. It will be known as a humanoid robot and autonomous robot taxi service delivery company. Thoughts gentlemen? So two quick thoughts. One is never bet against Elon. I've learned that to be a massive investment portfolio. full -yo suffering over the last decade. I think the second observation is, these cars are technologically quite inferior to the Google Waymo Taxis because they don't operate in heavy rain, they're limited by human level site.

1:21:13And that's a problem, I think, in the long term. He may get some buzz out of it, but he's gonna have to upgrade the LiDAR for this to be really well - We'll talk about that. And he could be slow and hold on. Let me just talk on the other side of that. But he could just be waiting for LiDARX systems and all that. The Costco room becomes cheap enough and then you just flip over to that. Well, you know his thesis, right? If a human driver can drive with just his or her eyes, in fact, with one human eye, then from first principle, thinking an autonomous car should be able to drive with a couple of cameras.

1:21:45And that's basically the essence. That's great, except LiDAR can see five cars ahead. So I want to give it to Superhuman skills. Yeah. I can't see where you can get it. You can do it, why not do it? And yes, it's much more expensive for now. I think because he went down a philosophical route of going away from Lidar and I think you end up with an inferior product. But if it's workable and it works, good, well enough, that's fine. I mean, listen, I drive with my Tesla's autonomous mode all the time and it does perfect. The only time it ever stops working is when it catches me, picking up my phone and looking at it and it keeps that made.

1:22:22Otherwise, it's extraordinary in the rain. That part surprised me actually. I didn't know when we were driving together a couple of weeks ago, the inward facing camera is new to me. It's like actually watching your behavior. Yeah, it's not being adjusting. It's like, wow, that's a little bit more. We're looking out the window to the left. It's sort of like beeps at me. If I pick up my phone, it beeps at me. It's like really annoying. I kept my 2017 Tesla Model S for exactly that reason. There's no inward camera, so it's great. I've now driven that car just to flip to the other side of this. I've now driven that car four times up and down the country from Miami to New York or Toronto.

1:22:58So I've become a bit of an expert at the Drive -ins. Have you heard about this thing called an error? You know what? I load up with five of my favorite trauma co -labs. I arranged 40 conference calls the car drives itself 80 % of the time and it's free To do that and I arrive more refreshed than I when I left. I mean, it's phenomenal. All right. Let's take a look at this next one And so Tesla faces protests in Austin over musks, robots taxi plans, protesters claim, Tesla's FSD full self -driving has been linked to hundreds of crashes, including dozens of fatalities. So let's look at the data here one second.

1:23:37Here it is, number of accidents per million miles. And without any question, listen, humans are terrible drivers. We are distracted constantly now with at least one cell phone per car. We are terrible control systems for two ton cars going at high speed. Can I even throw it at a quick data point here? Sure. In 2011, I think there was a three -day outage in Blackberry services around the world. Nobody could send text messages for three days. The accident rate in Abu Dhabi dropped 40 % during that three days. That was then. Today, you look at anybody driving through a smartphone. We absolutely should not be driving as human beings.

1:24:15I agree. I mean, we're going to see an extraordinary increase in safety. I mean, just the idea of a 16 or 17 year old driving a couple of ton vehicle at 60 miles per hour through the streets with very little experience and their phone distracting them should scare the daylights out of everybody. Well, this is America's greatest Achilles heel actually is that we're We're responsive to sympathetic stories that are statistically rounding errors. And it's actually the... Or wrong. Or wrong, yeah. Sometimes, well, look at the state of the union address, you know, somewhere along the way, it changed to, let me call out four or five people in the crowd here and tell their personal stories.

1:24:59You're like, well, how do I know if that's just like, that could be one and a trillion for all I know? But yeah, that's okay. I'm just trying to sway a bunch of voters toward what I'm trying to get done here. But we're ridiculously swayed by that. And if you look at that prior slide, yes, hundreds of fatalities from self -driving, like, well, hundreds relative to what? And you put your statistician hat on, you're like, this is clearly better. But some of these are really, really tragic. And if it's all captured on video, which everything is now, it can sway opinion. And this is where if America is gonna lose to China or to some other state, It's going to be for this reason.

1:25:38Yeah, it's the same concept when people hear about an airplane accident, oh my god, I'm fearful of flying. It's like, have you looked at the accident rates and cars? I mean, you know, flying is still the safest mode of transportation. 1 .2 million people are dying car accidents around the world over here. Yeah. Well, hey, nuclear power. We will come to that later, I guess, but that's another case study. We will. So here's an important news bite from this past month here in LA. Five WEMO vehicles were torched in downtown LA. WEMO POS service in LA, limited San Francisco, Austin, Phoenix, Atlanta.

1:26:18And the question is, is this the beginning of the Luddite revolt? Right, so are people responding against all of the technology And here's an image of the Ludite Revolution from 811 through 816. And I have some data I want to share with you guys on this, because I think it's worth noting and I want to talk about it. So the Ludite revolt over that five year period was a series of protests by English textile workers against the mechanization of the industrial revolution, particularly against automated looms that threatened their jobs and wages. Sounds familiar, right? named after the mythical Ned Luddite, the movement began in Nottingham and spread across the UK.

1:27:07Workers fearing, deskilling, and unemployment amid economic hardship from the Napoleonic Wars destroyed machines and organized raids at night. The revolt involved thousands. The British government deployed 12 ,000 troops to suppress it. Sounds familiar. And here we go, quote, machine breaking became a capital crime in 2018 -12, leading to 17 executions, dozens of hangings, and the movement was crushed by 1816. Thoughts, Selim. Well, this is the classic immune system response, right? In a slight twist, note, I note when I read this up, the Waymo cars were actually called to that spot so they could be attacked.

1:27:58So the AI is watching those people carefully for future retribution. But I think this is the general backlash of technology against society. What we don't understand, we fear and what we fear we get angry at and we try to destroy. Yeah. I like the picture of the picketers that are in front of open AI. You know, the security guys have cleared them all out now. But if you pull one off the internet, it's a very let -out revolt looking. Yeah, and I think we are without question going to have a revolt, you know, how often and where against which companies? I mean, we haven't really started to see job displacement truly occur, but when it does hit, and I think we'll be seeing it significantly in the next two to three years, until we figure it out on reskilling and, you know, other mechanisms.

1:28:48Can I give the positive spin here? Of course, we have no more rooms. No, it's the fact that we've seen this kind of displacement fear throughout history and we always survive it very, very well. Yes, of course. And on the reskilling, which everybody's like, oh my god, how are you going to reskill? Note that we have AI to help reskill everybody, right? And so you can pick your passion and go, I want to be reskilled in that area and you'll get a really good potential work. Note also that we're near full employment today and have been for a while. So we actually need a little bit more buffer in the labor market than we have today.

1:29:28So those are my positive spins that I also understand the negative. I am curious what rules and regulations the government will put forward. I don't think it will become a capital crime. I do think we'll see troops again deployed on things like this. This was the arm of the Waymo cars with little machine. Fight back. This was a scary story. Two children shot while in a Waymo here in Santa Monica at second and Broadway. This is actually like I'm probably a mile from my home. Two teens were shot in Armantarzo, non -life threatening, now stable in hospitals. I think violence against tech, I don't know if you remember all of the scooters here in Santa Monica, I assume if you were here at that time.

1:30:16And the scooters, people sort of raged against the scooters because they were blocking sidewalks. They would literally throw them to the middle of the street. They'd decapitate them. I think we're going to see when we see Wamo robots, or not Wamo robots, when we see Optimus robots and figure robots on the streets, I think we're gonna find them in various positions hanging from trees.

1:30:42We are, but I think this is really just part of the shift. I mean, they'll probably call the Waymo to try and get away and there was probably some sort of gang violence involved in this something like this. Yeah. Okay, this was the slide about Waymo versus Tesla. And here's a tweet, the downfall of Waymo began yesterday. This was on, this was tweet on June 23rd about the launch of Elon's Robotaxi. So people need to understand the Waymo car is not cheap. It's a $200 ,000 vehicle. It's got 29 cameras, five lightars, six radars, versus Robotaxi. and Elon has held to his first principle thinking, there shall only be cameras.

1:31:33All right. This would be a great Dave Salim bet. Dave, do you have a particular preference in which one would probably not win this? Yeah. Yeah. Peter, you know this topic far far better than I do. My bet, knowing what I know is that it'll be about a 70, 30 split. There's always two or three vendors in any given market in the US. It always stabilizes at that for antitrust reasons. Tesla will grab the lead now because they put a bigger investment into the neural chips. On the other hand, you know, Google's got incredible technology. So, but if I had to bet right now, it's a 70 % of the market goes to Tesla, 30 % goes to Waymo and stabilizes.

1:32:15So I'm 50, 50 because I always prefer better technology, but you have the, never bet against Elon problem on the other side. You know, here's the issue. It's a huge capital expense that Waymo will need to roll out to do this nationwide. Elon's got a different option. You buy a Model Y, you turn on self -driving, it drives you around, you're going on vacation for a week, you tell your car to go off and earn your revenue. So basically the CapEx is covered by the consumer and it becomes a revenue engine for you. So you'll buy a couple of these and just have them got there. So he's going to pop you weight millions of these cars across the country at no cap X to himself.

1:33:02So if you apply that model, which is essentially the EXO model, which is assets on demand, and you don't own your own assets, and you let other people self -provision these assets, et cetera, that will win hands down because it'll scale much, much faster than Waymo trying to its own car was your house too. Yeah, it was just directly connected to our other side bet, which is, remember last week, Elon and Trump finally break up, now they'll hate each other forever. I was like, no, no, no, no, no. No, one this might be totally made up. You know, they might be just trying to make PR for themselves when surprise me at all, but two, if it is real, which it probably is, though it doesn't make up in no time.

1:33:39That was my bet. Yeah, but I'm not a bad guy. Anthony Scaramucci is going to join us back on this pod to talk about how the administration was really accurate last time when we got fair inauguration we asked him how long was bromance last time he said I think thirty square mucces or something like that and it was really near dead on almost to the day so we don't expect his views next time yeah well look the government needs space launches and Elon needs regulatory approval of that really good idea you know you buy your car and then you lease it back to be a a robot taxi. It's just really good.

1:34:15Let's hit a couple other quick ones. This is flying cars and drones. We've seen the Trump sign an executive order on drones and flying cars and supersonic. Really important for these drone systems to actually work. You need to enable beyond visual line of sight mode. and we're seeing the US government support five regional EBTOL pilot programs. Super excited about archery aviation here in LA to serve the Olympics in 2028. And the other point here is they're enabling supersonic travel by scrapping outdated overflight bands. So, you know, the supersonic jets of the Concorde could not fly over the domestic US because of the sonic boom and changing, providing FAA waivers, in particular because a number of companies have come up with mechanisms to actually avoid or absorb the sonic boom, but this is going to accelerate aviation as it should.

1:35:20I mean, there hasn't been that much change in aviation for the last 50 years. It's been incredibly slow. Yeah, I was wondering if all the privatization of space travel was also going to lead to breakthroughs for, you know, out of the atmosphere, hypersonic travel. Because, you know, I don't know if you remember Steve Keishie was working on that. Yeah, I know way too much about this. It's just really tough. I mean, the amount of energy and to build something that's going to go skip across the upper atmosphere. And there have been many companies who have died on that mission statement and billions invested.

1:35:57The closest thing right now is Starship going spaceport to spaceport, but it's still expensive. Here, another competitor, we know about three or four companies out there providing EVTAL services. This is a whisk. It's been selected by Miami to launch in that location, so watching out for a whisk in Miami. I don't know if I'm going to talk about these EV tall flying cars. It'll all slim, but they're coming. Interesting. Dave, when we spoke to Eric Schmidt about this, he was not a believer in EV talls. Yeah. I think it was a relative thing. There's so much change going on and so much of it is so impactful.

1:36:51And I don't think it was like, yeah, I don't believe in this. It was like look aviation. We have helicopters. Now we're gonna have four prop electronic versions of them. So what? Like, well, so what to me is that they're self -flying, self -driving, that to me is really, really a big deal. And they're much safer too. So I do think it is a big deal, but he's like, yeah, but relative to space and AI, is it a big deal? and he was like, no, not really. For me, this is one of the most exciting technologies we could have. Can I explain why? Sure, but you're still driving your test lever place. I am, but I just love it.

1:37:32That's fine. I'm allowed to do that. By the way, I have a Porsche Macon electric also. And it's like maybe the best car I've ever driven, but it's not way, way better than my 2017 Model S. It's marginally better. So that's really profound as say how much further ahead Tesla was than all the other Carmichains in many many areas, but let me go back to the eVTELTS for a second. Okay. I think this totally changes the game. Why? because Real estate that's hard to get to is priced very low and it's scarce and therefore we pay a lot of money for that little waterfront property on a lake somewhere because there's not that many of them.

1:38:14Well now you can get to all sorts of places you can't get to by road. It's going to make an abundance of or a really beautiful plot high up on a mountainside that you can't get to by car. Now that becomes a viable real estate and we turn real estate from a scarcity problem into an abundance problem. And I think that's incredibly exciting for the future. There's huge economic implications for this. Not just to mention, many of us fly around a lot and how much of a nightmare is the damp commute into the city. And just having a drone corridor from Kennedy Airport into Manhattan would just change the game.

1:38:50Yeah, for sure. And that is coming. We've seen this with Jobi with Archer and that with Whisk. You're going to get commute from downtown Manhattan to JFK in one of these vehicles. Right? Yeah. In Sao Paulo, it's two hours to get to the report. Sao Paulo, you have a copter. So the only option you have if you've got a lot of like not the safest. So these are safe and solid. And I think there'd be some become really a big deal tourism destinations. I mean, the list just goes on of the broad effects this could have. This is usually exciting. Yeah. Every day I get the strangest compliment. Someone will stop me and say, Peter, you have such nice skin.

1:39:30Honestly, I never I'd hear that from anyone and honestly I can't take the full credit. All I do is use something called One Skin OS 1 twice a day every day. The company is built by four brilliant PhD women who identified a peptide that effectively reverses the age of your skin. I love it and again I use this twice a day every day. You can go to oneskin .co and write Peter at checkout for a discount on the same product I use. That's oneskin .co and use the code Peter at checkout. All right back to the episode. I want to jump into the next subject which is timely and critical which is the demand for energy from AI systems And a little bit of a look at US versus China.

1:40:14I think people need to understand we are going to become limited by power in our quest for digital super intelligence So how are we going to power this revolution? So China is rapidly scaling up on nuclear. It's their equivalent of a split -knick moment. So China aims to surpass the US by 2030 in nuclear. I mean, the numbers are staggeringly incredibly pessimistic here. The US only added two reactors this century. I mean, two reactors, you know, over the last 25 years, 94 total in the US versus China's 58. China is building a reactor every 52 months. The US licensing alone takes 10 to 12 years.

1:41:09Yeah. Crazy. Yeah. Yes, the reason I love doing this podcast and I look forward to this so much because you know, your team will dig up a topic that I really need to study. and then it'll come into the deck, I'm like, yeah, it's just so fascinating to be to dig in on these things and it's just so fun to talk about it. A lot of these things, like, you know, this are so obvious and this is America's Achilles heel, like we cannot act on long -term thinking and long -term investing. Our investment cycle is three, four, five years at the most. Our election cycle is eight years, four years or eight years.

1:41:44And we can't think about 10 years in the future. And so it's killing us. It's absolutely killing us. But got the data in these next couple of slides is mind -blowing. Yeah, I mean, we're gonna talk about nuclear in a future podcast with some of the CEOs in this industry is but you know generation one nuclear power plants and all that exist. Generation two plants are still out there including what we saw with Fukushima and three mile island. And then those were the dangerous plants. Generation three have been the plants that have been really manufactured over the last 30 years. And then generation four are the plants that are currently have been designed, are fail safe.

1:42:28It's kind of nuclear plant. I'd put in my backyard. But the timeframe for these plants, for developing them, is insanely long. We're talking like, if you wanted to start today, it would take you 10, 15 years. And that's why 3 mile island is being recommissioned because it's already approved from a government regulatory standpoint. It's crazy. Yeah, it's totally crazy. William, I've got a really, really angry about this one. I'm trying to be constructive here, but we know that solar scales. China's going to have more solar in the entire world. That's our next topic here. Let's go to the next slide.

1:43:07I don't wait until you get to lean. You got to lean here. You muted yourself. I don't know if you muted yourself. Yeah, yeah, I'm just really mad. I was just perfect with that. I was good to swear and I thought I'd better cut off the mic before I swear. All right, so here's, let you take the lead here. China is winning the race to become a type one civilization. In other words, civilization that harnesses all the power hitting the earth and the sun. By 2030, China will have the ability to build an entire US worth of power generation from solar and storage alone every single year. Look at this chart.

1:43:44Sleem, talk to us about this. You go, Dave, let me just gather myself. No, this chart is, I added the gigawatt axis on the left there because who the hell talks about terawatt hours per month, what the hell is that, Matt? But anyway, gigawatt is a better way to look at it. But this is actually gigawatt actual utilization. They actually created about 700 gigawatts of solar panels last year, 2024, and deployed 250 gigawatts of peak capacity. I mean, so this chart shows up. I mean, the helicopter, the hillside's covered with solar, right? We covered that on a past podcast. It's insane. They're just rolling this out, building capacity and distribution.

1:44:24Yeah. Yeah. I mean, just for context, the US total capacity energy production is 1 .2 terawatts, so 1 ,200 gigawatts. And so, you know, peak actual utilization is more like, you know, three quarters of a terawatt. So, you're like, yeah, half of what the US creates, they created in solar panels in 2024, just solar panels in 2024. That's the same. All right. So they have an advantage because they've got all the earths and they can use those for solar panels and build out. They're going to add more solar than the entire US energy output in a little while. So that's going to be crazy. It blows my mind that we are putting restrictions and not extending tax credits for solar and other stuff here in this country.

1:45:06We need to unlock that in the biggest possible way and let private sector go nuts on this and put government subsidies there instead of government subsidies on oil, which is what we do today. It's the stupidest energy policy we could possibly have. I mean, I'm fine with all energy needs to be made available, but where do we invest on growth? You know, solar is available two -day. You know, the numbers are... Can I just share a couple of points here? There's a... Yes, please. Energy that hits the earth in one hour to provide the global energy needs of the entire year. So one year worth of sun hitting the earth provides global needs for the entire year.

1:45:51All right, so here are some additional numbers. Global solar capacity reached 1 .13 gigawatts by 2024, about 1 % of global energy need is being provided by solar. It's estimated that if you cover just 0 .1 % of the earth, about 150 ,000 kilometers, with 20 % efficient panels that would generate 200 ,000 terawatt hours annually exceeding current demands. So how big is 150 ,000 square kilometers? It's about the size of South Dakota. I've never been to South Dakota, but if it were covered by solar panels, it'd be giving us a huge amount of energy. So the problem with solar for data centers and AI fundamentally is the good thing about AI is you can move it to the power.

1:46:39You know, you take a day to the moon. That's a huge advantage. The bad thing is you need those chips to be running 24 by seven. They depreciate really, really quickly. They're very expensive. The chips cost 10 times more than the power. You're not gonna let them sit idle if it's raining out. So solar has the horrible flaw of being intermittent. And so it's really good if you can store it, but the cost of lithium to store the solar when it's cloudy and raining is about five times higher than the cost of the solar panels. So if you want to become the world's first trillionaire, find a way to store huge amounts of energy cheaply.

1:47:14Here's the way. And we're going to be talking to Bill Gross, the CEO of IdealLab. And he's been using gravitational storage, which is, we'll talk about that, rather than storing into batteries, you use the energy during the day, a portion of energy to move a large weight vertically, and this has been done with water for ages. but you move a large weight vertically and then at night the weight gets pulled down by gravity and in a generator generates electricity. So it's efficient, it's available and it works. Can I throw out some thoughts here? Sure. So in 2016 we crossed an inflection point where it became cheaper to build a solar power generation facility than fossil fuel and almost all energy and generation since then has become, has been solar because of that.

1:48:06In 2019, we hit a more important inflection point, which is that it became cheaper to build solar than to build and run solar than it was to, sorry, it became cheaper to build and run a solar facility than just run a fossil fuel facility. So the capex and opax of solar are now cheaper than the opax of fossil fuels. That's a crazy inflection more, meaning we don't ever need to build a fossil fuel thing again, and we should just be building solar. The utility storage problem has been solved at scale, as you've said, at large scale, this is very easy. You just pump water up a hill to an artificial lake and use hydron at night on the way down, right?

1:48:44It's a little clunky, but it's very workable until battery technology or energy of all type stuff that build grosses along, doing comes along. So this is a really unknown problem. We should be going full out for this. The, I think it was 100 miles by 100 miles to power the whole of the US was Elon's calculation. The one I saw was 2 % of the Sahara covered with solar panels gives you enough power to cover the whole world's energy needs. Distribution is a challenge, but just that visual is a really killer visual. Well, here's the chart that was posted. Elon's tweet is solar is 100 % of energy long term.

1:49:23No question, this is what's going to drive humanity forward. And here's a chart that basically reads, it took eight years for solar to go from 100 terawatt hours to 1 ,000 terawatt hours, and then just three years to go from 1 ,000 to 2 ,000 terawatt hours. You can see that super exponential growth curve exceeding hydro, coal, gas, nuclear wind. Pretty amazing. Yeah, I really like pumped hydro is very, very efficient, but you need a you need a about a lake the size of Loch Ness to move up about 300 meters and come back down to store enough energy to power a huge data center. So that's a lot of water.

1:50:02Bill Gross has solved that right with these gravitational towers. Basically you pump huge multi -ton bags of dirt up into like an elevator shaft into a large building or up the hillside if you're near a mountain. Right. And he's got this working today. He's got huge contracts. We'll be talking to him about that. I think storage can be solved. And I'm hoping in fact, AI is going to help us with new technology for our own problems. Yeah, that's exactly what I was going to say. If you're a material scientist or or a chemical engineer, I'm pretty sure with AI's help in a couple of years, or maybe even this year, come up with a reversible chemical reaction that's completely self -contained that stores huge amounts of energy, use the solar to drive the reaction one way, and then when it's cloudy, run the reaction, the opposite direction.

1:50:54And if you come up with something that's 10, 20 times more energy dense than a lithium battery, it seems very viable, you're gonna be a trillionaire. Yeah, so just figure that out, use AI to help. I can't. A couple years ago we tried to design an express around this and the numbers were get off grid storage 50 times cheaper than it is today, which is very viable. Here's another tweet from Elon solar power in China will exceed all sources of electricity combined in the US in three to four years. It's a wake up call. China is going all in on energy production and it's epic. I want more things to say about this.

1:51:41I think this Chinese US stuff is a little overhyped. I don't think we'll have that much of a, I think it's a massive amount of it. I think it's a stocking one. But I think it's a great, it's a great, yeah, agree. But it's a great comparator. I don't think there's real deep conflict there. No, there's not. But what it does is it shows the US what is possible. Yeah, and to take it out of your point, this is a structural issue we have in the US where we have four -year election cycles and we have no mechanism to look at 20 years and say, this is the water, healthcare, energy, we need over 20 -year period.

1:52:15We need to solve that. Well, and you know, running our venture funds, you know this acutely, but you make an investment, investors want to see liquidity within four or five years. They don't want their money to be sitting out there for 10 or 15 years. In China, they know they'll still be in power. They think they'll still be in power 20 years from now. If you look at the date, they said, you know what, we need to be the world's biggest manufacturer of solar panels. It says about 2004 or 10 or something around there. From that date, do you have the factories up and running and you have the production?

1:52:45And then also, when there's a recession, you got to keep cranking. So just keep the engine running because you got a 20 -year view, 30 -year view. Yeah, we just can't do that structurally in the US. And that's why we get so far behind in nuclear and solar and some of the other long -term trends. And that is our fundamental Achilles here, heal. Hey folks, Slim here. Hope you're enjoying these podcasts and this one in particular was amazing. If you want to hear more from me or get involved in our EXO ecosystem on the 23rd of July, we're doing a once a month workshop tickets are $100. We limit it to a few people to make sure it's intermittent and proper and we go through the EXO model.

1:53:25What we do there is we basically show you how to take your organization and turn it into one of these hyper growth AI type companies. And we've done this now for 10 years with thousands of companies. Many of these use the model that we have called the Exponential Organizations Model Peter and I co -authored the second edition a couple of years ago. So it's a hundred bucks June July 23rd. Come along. It's the best hundred all you'll spend. Link is below. See you then. All right, last subject for us gentlemen, crypto. Always have to look crypto in the conversation. We've seen Bitcoin over the last couple of weeks dipped down below 100K and resurrected self up to 107.

1:54:03Predictions, Selim that I'm seeing still hold that we might see 200K by the end of this year. I still remain all in and massively enthusiastic. Are you? Big time. I heard Michael Saylor say Bitcoin will get to 21 million a Bitcoin. I'll be happy when it gets to a million a Bitcoin. That'll be perfectly good enough, I think, for most people because that'll just put it at the level of gold, which is infinitesimal anyway, as in terms of global asset class. But I think there's a bunch of things happening that are making this move very huge or very, very, that'll start to accelerate this. I heard Freddie May and Fanny Mac are looking at or approving mortgages back by Bitcoin.

1:54:43That'll be a huge thing. So it's starting to get systemic approval and then things go crazy. Yeah, for sure. I love this. This comes from our friend Brian Armstrong at Coinbase. Earn up to 4 % Bitcoin back on every purchase with a new Coinbase one card. I love this. I'm going to switch over from my amics to this. How about you? Big time. Yeah. Dave, thoughts? I'm really excited about the next story actually. All right, well, let's go to the next story here. Dave's whole league is powder. Okay. Yes. So go internet group goes public and explode goes exponential. Yeah. Yeah. So two parts of this story, one of them is Jeremy Alair, who's stuck with this for so many years, and he deserves every bit of his success, for just just grinding it out.

1:55:40It's always tough to be an entrepreneur. He had to grind it out over a long period of time with regulators all over him and different administrations and people go into jail and what a persistent story. But anyway, the reason this is so, so important is because agent agent transactions can be done in either Bitcoin or dollars now. And you can move back and forth seamlessly. The old method, the Swift Network, the Interbank Trading Network is great if you're trying to move a million dollars to Hong Kong because it's only like a buck, terrible if you're trying to do a penny micro transaction with another AI agent.

1:56:16So this solves that problem. Because the current pricing model on AI is subscription fees. You give me 200 bucks a month or 20 bucks a month flat. But that's crazy, right? The utilization gets throttled because, you know, if you're trying to write code or talk to your AI, it'll slow down every now and then why is that? because there are too many users online. Like, well, why can't I just pay for what I use as I go? Well, it's because we didn't have circle. So the whole AI economy needs to now move to these micro payments, and this is what's going to enable it. And that's why the stock is up so much.

1:56:46Yeah. I've been texting with Jeremy super impressed, congratulating him on this exponential growth. The IPO goes out at $31 a share and peaks at $300 a share extraordinary. These are the IPOs that the entrepreneurial market needs to fuel sort of the opening of the door is wide open. Celine, thoughts? I want to just echo the kudos here for a slightly different reason, which is one of the big issues in the crypto world has been trust. And you have a lot of scam artists and a lot of structures. And can you actually deliver trust in Germany over a long period of time has demonstrated it rock solid stable trustworthy environment.

1:57:33And that's not an easy to do in the environment where everybody else is actually. And in the United States, we've been using Kudos there. Within the US territory of law, if you would, which is super important. So, you know, Circle Internet Group is a financial technology founded in 2013. It's a stable coin pegged one to one for the US dollar. and it's going to enable, as you said Dave, my AI agents to go and transact, micro transactions. And it's finally going to enable what has been the full promise of the internet, not just data, not just video, not just words, but a financial layer. And I can't wait for my - Can I say one thing about stable coins?

1:58:23Yeah, sure. It's awesome to have this peg against the dollar, but once you have something there's so many natural assets in the ground and out in the world. Amazing. And when you can peg a stable coin against say real estate holdings or something like that when that becomes possible, as long as the trust again needs to be there, you're going to unlock unbelievable amounts of capital flow. One of my friends is actually a contract that I can't say the details here with a government who has large gold deposits underground. and they've gotten a contract where they're going to peg a token against the gold in the ground and not dig it out wait until the technology for being able to extract it more environmentally friendly is there but you know that's an extraordinary thought that there's so many assets that could be sort of connected to a token or a stable token.

1:59:20Yeah that's a great it's the missing ingredient actually in kind of the trifecta of digital transactions because Bitcoin has become a great store of wealth. But it's, you know, there's no guarantee that it's stable. The dollar is guaranteed to go down and value, right? We just print more dollars every year. So you don't want to have a huge balance sitting in circle for a long period of time. So what people will tend to do is park their money in Bitcoin. Then what if they want to transact in dollars, move it over to circles. It's all seamless. Do your micro transactions in circle and then come back to Bitcoin.

1:59:48But what if you want something tied to something incredibly stable like real estate or gold or whatever? Well, it doesn't exist yet. That would be the trifecta of the crypto circle. All right, Moonshot mates. What an extraordinary couple of weeks since we spoke last. I mean, there's so many other stories I can't wait to cover with you guys in next week or two ahead. Any travels coming up for you guys? Selim, are you orbiting the planet again? And I just came back from a hundredth birthday party of a grandparent, Lily is one of Lily's grandmothers, which was unbelievable. Not going anywhere for a bit.

2:00:28I think I'll be seeing you soon, Peter, at the end of July in Utah maybe. So we'll talk for a few. That's great. Dave, how about you? Yeah, we're going back to see Kevin Wile very soon in San Francisco. go hopefully the sooner the better or as I'm concerned. And then open a quarter's mega events, you know, opening a headquarters, our mega events on September 9th, Google agreed to host the, the pre -party at their HQ. So that's going to be, so I'm basically going to be going back to Sam Fran over and that's why I need that hypersonic plan. I just want to get back to forth a lot. All right, dear moonshot mates have a fantastic weekend and and excited for next week.

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