Airbnb 2.0, Warren Buffett Exclusive in WSJ, Apple to Support Brain-Implant Control | Alex Blania, Eugenia Kuyda, Josh Wolfe, Jason Fried, Delian Asparouhov

26:30Yeah. To that end, Chesky spent a lot of time focused on app details like the icons and the animation and everything looks great. The problem, however, is that Jobs was creating products and Disney was creating experiences. In both cases, the attention to detail was critical to how many people wanted to buy iPhones or visit Disney World. Chesky, on the other hand, has created a marketplace and the success or failure of marketplaces is not governed by the details of icons or the layouts of apps, but rather by how how much more blunt instruments like incentive structures and take rates? Yeah, it's very, very interesting.

27:04There was one criticism of the - Spicy from Ben, a little spice. A little spice, yeah. A little spice. Yeah, yeah, yeah. Yeah, there was some, I saw some kind of negative feedback on X to the Airbnb launch. They were quote tweeting the video and they were saying that they should have used more B-roll and made this more human. Instead, they're showing us a lot of UI. and I just think about the Airbnb UI as being like fees and charts and ratings and stuff. Yeah, the beauty of Airbnb is that in a simple way you can get access to incredible spaces and experiences. Yeah, and that's what's expensive.

27:37And you don't want to be thinking every time I'm in the Airbnb app. It's money, it's cost, it's headache. I'm there because there's a problem, right? And so they actually need to minimize that and focus on the actual experience for sure. This doesn't look anything like what the pictures, the pictures you had. which has created, obviously, an opportunity for Wander. Sponsor of the show, by the way. So Ben closes out by saying, these are the dynamics that undergird my skepticism of Airbnb's new offerings. The impression I get from the presentation and profiles is that Chesky seems to think that the first version of experience has failed because the app wasn't good enough.

28:14I think it failed because the economics don't work. There was, of course, similar skepticism about Airbnb's core offering from the beginning. It's one thing to look backwards and describe the arbitrage opportunity that was available in short-term rentals, and another to have understood that opportunity when Chesky rented out that first airbed in 2007. What a fantastic story. Moreover, one way to think about the impact of AI is that it will create the conditions for massive market expansion in real-world experiences and services that can't be done by computers. It's plausible that Airbnb can leverage its huge user base, which is massive,$2 billion, remember, into riding a wave that may now be forming.

28:49So that's kind of the bull case that he's laying out there. Everybody becomes post-economic after ASI. But you want to - And everybody just does Airbnb experiences all day long. And a personal trainer maybe, or just somebody to hang out with. You know, I think in many ways, Airbnb is safe from some amount of disruption to the core business, which is a hyper-scaled, you know, vacation rental platform. But at the same time, you know, it's hard to undersee where, you know, once they're at 2 billion users, right? Where's the growth gonna come from? That's tough. Especially when you have, you know, new providers like Wander, which are coming in and potentially, you know, and we're seeing this already, just eating away at some of the highest value users.

29:35Yeah, and also, I mean, just for a comp, Hilton Hotels is a$60 billion company. So it's like, even if they were able to go - It's like 77 billion. Okay, yeah. Marriott, yeah. So even, yeah, 75 today, 74 today. So even if they were to go build like a whole hotel chain and enter that market, like again, that's still not a 10X. That's still not putting them in like the trillion dollar conversation of like hyperscale, which is like probably where you want to go. He wants to be in that conversation. I think so. That separates the Michelangelo from merely the disciples. But I mean, it's been a fantastic run.

30:13It's fantastic. Yeah, it is an interesting dynamic. Do you want to own Marriott at$77 billion with an CEO who I can't name versus Airbnb at just slightly above it? He's going to try something. He's going to try a couple things. He's going to be doing a different release in a year, and maybe there's an entirely new idea. I think if he did the Chesky method, a bodybuilding course, he could probably add$100 million to the bottom line. 100%. just pure, you know, even better margins than, than software. He's still looking extremely strong. Yeah. He, you know, there's like those old photos of him as a bodybuilder, but he's still looking jacked.

30:52Yeah. It's great. Still got it. Anyway, at the same time, so Ben Thompson closes with, at the same time, I can't help but wonder if many of the French frustrations that Chuck, that Chesky chalked up to management mode, manager mode are in fact for him personally downstream from building a service where one can only guide the outcomes you want, not dictate them. The fact that the romantic story he tells about what Airbnb symbolizes doesn't seem to match up with the reality of what Airbnb is may itself be an analogy for Chesky's desire for control in arenas where he has very little. Interesting.

31:25So yeah, I mean, you're building a marketplace. There's only so much control you have, as opposed to building a product where you can say, I'm going to go build a virtual reality headset now or an Apple watch, and it's going to look like this, and I'm going to mold the screen and make all these products. Yeah, if you really just wanted to do product design, what's the classic founder has an exit and then builds an app that allows you to meet friends in your area? And they're like, I just want to build an app to meet friends. And then you're just like, no, you're building a dating app. Like that's who's going to use this.

31:56Yeah, yeah. Understanding like the base reality of human interaction and economic forces. Multiple buddies who had great exits and then built like that app and then eventually realized what they were building and had to pivot away. It's the same thing with the personal CRM. I want a personal CRM. It's like, no, you just want a CRM. Like if you're thinking about your personal relationships in that transactional of a way, you should just think of it as business associates that you're pitching and just use an actual. Salesforce. Yeah, just use a real CRM. Yeah. Anyway, some news in the chip world.

32:29The US has scrapped the AI diffusion rule in a revamp of Biden era chip curbs. This was tearing up the internet. We were trying to get Dylan Patel on a little bit earlier. He's booked in a week or two. He's traveling a lot. We'll get him on to break it down. There's a few other people. Jordan Schneider over at China Talk is on vacation. It's a disaster. So there aren't as many people to comment on this as I was hoping, but fortunately, the Wall Street Journal has a write-up. And so Microsoft and Oracle have spoken out against the rule. Again, the AI diffusion rule. The US Department of Commerce said that it's rescinding the diffusion rule on the grounds that it would have stifled American innovation, saddled companies with onerous regulations, and undermined diplomatic relations with a dozen countries, dozens of countries.

33:13NVIDIA said that it welcomed the Trump administration's leadership and new direction in AI policy. With the diffusion rule revoked, America will have a once-in-a-generation opportunity to lead the next industrial revolution and create high-paying U.S. jobs, build new U.S. supplied infrastructure, and alleviate the trade deficit, a company spokesperson told the Wall Street Journal. Tech companies, including Microsoft and Oracle, had spoken out against the rule, which imposed caps on how many chips countries such as India and Switzerland can buy, saying the move would limit US firms' opportunities abroad without doing much to hamper China, the main target of the Titan controls.

33:48It was a little wild that we were limiting places like India and Switzerland, which we have strong relationships with. I mean, this all started with the Singapore loophole and the chips going to Malaysia. and it really seems like, you know, this is the sledgehammer versus the scalpel, right? Everyone's okay with the scalpel. People don't like sledgehammers. Yeah. So Jeffrey Kessler, who's the U.S. Secretary, Undersecretary of Commerce for Industry and Security, says the Trump administration will pursue a bold, inclusive strategy to American AI technology with trusted foreign countries around the world while keeping the technology out of the hands of our adversaries.

34:26So anyways. Yeah. Meanwhile, Jensen is over in, we got to pull this video up. Oh, yeah. They made. I mean, we're talking about this with Aaron Ginn about how it's nice to think that, oh, if we don't sell NVIDIA chips to what was the company that you, or what was the country that you, India or Switzerland? Like, oh, yeah, like America will just have control and they'll have to use OpenAI and ChatGPT remotely via API. and it's like, no, actually they will just buy Huawei Ascend chips and run DeepSeek and Manus on top of it. They're going to want to run their own hardware. They want their AI super factories.

35:03Isn't it funny how the name Manus? It makes you sound like you're from Texas. It's so Texas. Manus. Anyway, let's pull up the video if we have a second. We don't run Manus on our DBAs. We don't take kindly to Manus in these parts. We only like Llama. So Jensen has been in the UAE, I think Abu Dhabi, and they built what looks to be... Wow. Oh, it's elevating? This is awesome. That's not a hologram, is it? This looks like a hologram. Either way, it's awesome.

35:47What a squad, too. insane showmanship. Wow. Anyway. Another hundred billion to Jensen. And he is, we got to pull this up. Yeah, he's been on absolute tear. So the announcement also took aim at Chinese tech giant Huawei, stating that using Huawei Ascend chips anywhere in the world violates U.S. export controls, of course, because Huawei Ascend chips are potentially built on top of American-owned IP in the lithography stack and therefore can be subject to US export controls, the Bureau of Industry and Security, a commerce department agency said it will warn the public about potential consequences of allowing American chips to be used for Chinese AI models.

36:31Rick Su noted that the Chinese company's advanced AI chips are only sold locally and that demand for them far outweighs supply, so Huawei should be able to continue doing business there with or without any changes in the export controls. Of course, China has immense demand for large GPU clusters. They want to train the next version of DeepSeek. They think that DeepSeek is probably going to move entirely to the next training run to Huawei Ascend chips. And although the Huawei Ascend rack mounted unit is not directly competitive with, I mean, it is directly competitive, but it's not at power dollar parity with NVIDIA's DGX.

37:09Yeah, on efficiency. It can train the models. It's just more expensive. But China has a lot of cheap power and is willing to invest. And so, yeah, it might cost 30 % more to train a massive model, but we're not talking about orders of magnitude and everything in AI is defined by orders of magnitude. Yeah. Anyway, do you have another? Yeah, I have another screenshot to pull up, which is just a funny chart to look at because you can see the exact moment that Jensen really started cooking. Yeah. Oh, there we go. So this is the largest company end of May, which we've been tracking. Oh, it's neck and neck.

37:40And Microsoft was at some, it's hard for me to see, but I think about 80%. Yeah. This is just for the end of May. So we're halfway through May. So last Monday, Microsoft was sitting at over 80%. And then Jensen said, one second. So right now, I think - Jevons Paradox, undefeated. There will never be enough venture capital. Yeah, you said they're going to study. They're going to put Jevons Paradox into preschool curriculum. After this. Really getting people to understand. People were so bearish on NVIDIA. And look at what happened. The more dinosaur toys you get, as dinosaur toys get cheaper, you're going to want more.

38:18You will. And you're going to buy more. That's true. It violates traditional laws of supply chain. But yeah, so right now, NVIDIA is sitting at$3.3 trillion market cap. Tiger actually just rotated out of ARM. Oh, yeah. Well, yeah, they rotated out completely and increased their position in NVIDIA. So when Tiger's long, sometimes they get it buried right. I think we need a soundboard key for Tiger. There we go. There we go. Fantastic. The change is a big win for countries previously limited from buying chips, notably Saudi Arabia, United Arab Emirates, Singapore, Israel, Morningstar said. It is also set to benefit US AI players like NVIDIA, AMD, and Intel, of course, because they'll be able to sell to more countries, and we're already seeing that happen.

39:06For China chip makers and AI companies, as the changes are likely to have only a limited impact since they are already banned from accessing from accessing U.S. tech and equipment. The news comes as President Trump tours the Middle East and a number of U.S. tech companies announced AI deals in the region. Only Intel could be down 30 % in the last year during an AI super cycle. So brutal. It's so brutal. Bet on the CPU, folks, instead of the GPU. Pick the wrong horse. Generational miss. David Sachs is quoted in here. The right race, the wrong horse. Right race, wrong horse. David Sachs says, the diffusion rule literally restricted the diffusion and or proliferation of American technology all over the world.

39:45David Sachs, Trump's AI and crypto czar said at the US-Saudi investment forum, adding that there is no risk with a friend like Saudi Arabia. There's friends. The original reason for this diffusion rule is that we have a policy of not wanting our advanced semiconductors to go to what are known as countries of concern, but that's not as big of a problem now, especially when it's a global competition. Anyway, we should move on to Apple. They're getting in the Neuralink game. They're competing with Elon, going head to head, literally. Putting chips in your head. So they're working with a startup Synchron on a new brain-computer interface to assist people with disabilities.

40:25And we'll just start going through here. So Apple is embracing the world of brain-computer interfaces, unveiling a new technology that one day could revolutionize how humans interact with their devices. The company is taking early steps to enable people to control their iPhones with neural signals captured by a new generation of brain implants. It's going to be huge for people that use AirPods instead of wired headphones. I was joking earlier, there's this company Believe that's going viral on X. Oh, I haven't seen this. For, you know, Luke Metro was doing this, right? He basically tagging the account.

40:55Oh, this is the crypto thing? And it, you know, all he had to do was just make a single post. It created a meme coin. Okay, okay. Yes, he's generating. Walk me through this. Future. This is really white mirror stuff. And so there's a world in the future where somebody could just think and a meme coin would be generated based on a thought. Yeah. And that would just be very American. Yeah. I mean, a lot of the gambling apps are using haptic feedback to vibrate the phone when you win, turn the flashlight on and off, really flash colors and sound all over to stimulate you while you're gambling. Imagine if they could stimulate your neurons directly.

41:30Yeah. Retention would go through the roof. I want haptics in my brain. Haptics in your brain, just massaging your neurons, just releasing dopamine directly. As soon as you open the mobile game app, the Pick 3, the Match 3, isn't that what they call it? Match 3. Brutal. So dark. I mean, the bulk case here is, of course, that Neuralink right now is an incredible technology for people who are paraplegic, right? Totally. So the earliest adopters are people who are - And I think it's smart for these companies to focus on that. Totally. because that's just such a more optimistic scenario. And then over time, allow people to bring things in.

42:10I mean, they're talking about curing blindness, curing deafness. There's so many amazing potential uses of this technology. Like any technology can go good or bad. It's up to us how we use it. Yeah, so the interesting thing here is that Apple seems to be letting other companies do the hardcore R &D and go through the FDA process to actually get approval for these devices. But they've been doing that more because AirPods are now approved as a hearing aid because they have the same technology that enables noise canceling, which is basically there's a microphone that's pointed outwards and then they play the opposite of that sound inwards.

42:50Are you familiar with how noise canceling works? So you're hearing both the outside world and then the opposite of the outside world. And so that creates the noise cancellation. that can also be used to amplify the outside world. And that's what happens when you have transparency mode on. But if you take transparency mode, which records the outside of the world and then plays it back over the speaker, if you take that to its kind of logical extreme, all of a sudden you have something that can amplify something like just anything you're hearing to the point of actually helping someone who is hard of hearing, which is very, very cool.

43:25So historically, humans have interacted with their computers mechanically using mice and keyboards. Smartphones introduce touch. Let's give it up for the humans. Oh, I was going to give it up for the keyboards and mice. And the keyboards too. They don't get enough credit. Peripherals are underrated for sure. Smartphones introduce touch, a behavioral input, but still an observable physical movement. A new capability means Apple devices won't need to see the user make specific movements. The devices can detect user intentions from decoded brain signals. Apple has worked on the new standard with Synchron, which makes a stent-like device that is implanted in a vein atop the brain's motor cortex.

44:00So I think this is less invasive than what Neuralink does. Neuralink, they actually have to drill a hole in your skull roughly the size of a quarter. And then the device fills in that hole. Just a quarter. Fills in that hole that's left from the skull that's gone. And then the electrodes are placed inside the brain. And then they place the skin flap back over and it charges wirelessly, which is a pretty crazy implementation they needed to invent a robot just to do the surgery because it's so precise and no human hand can place the electrodes or the neurons appropriately. But this, I think, would be less invasive because it just goes into a vein.

44:43And so it's as easy as taking some blood, basically. And the tinfoil hat enjoyers will appreciate that Synchron DARPA was in the Series A. So that's going to go over great on X. Yeah. I'm sure they're going to love that. Alex Jones will be all over this. Yes. Not the founder of Hollow. No, not the founder of Hollow. Who's also named Alex Jones. Yes. The founder of InfoWars. Yeah. Alex Jones. He's going to love that DARPA is funding, you know, brain computer interfaces in partnership with Apple. He's going to be front of the line. He's going to be all over that. Front of the line. Yeah. Famously loves technology, that guy.

45:21Yeah. Anyway, we have Delian Asperuho from Founders Fund and Varda coming in the studio next. Varda just released their third, or they just brought back the third capsule. Three for three. So we've got to celebrate that. Three for three. They said on X, is this boring yet? Are you getting sick of us? Until Dellian comes in, we'll do some ad reads. We'll talk about public investing for those who take it seriously. They've got multi-asset investing, industry-leading yields. They're trusted by millions, folks. Get on public.com. Their new feature, Generated Assets, is just wild. Very cool. You've got to go around and play around with it.

45:53It's just generatedassets.com. Oh, cool. We are going to take 10 different, basically you can create indexes with chat and then you can back test them so you can see how they performed against the market more broadly. So tomorrow I'm going to get like 10 or so different screenshots of different indexes that are interesting, but it's interesting. you can look at, for example, since we had Andreessen on yesterday, you can see, you can look at A16Z alumni companies, how they've performed in the public markets, and the results are astonishing. It actually makes me even more bullish on these sort of founder-led public companies.

46:35So excited to get into that. Well, as we wait for Delian, let's talk about So linear. Linear is a purpose-built tool for planning and building products. Meet the system for modern software development, streamline issues, projects, and product roadmaps. And when they say the standard, they're not joking. It actually, I think, I don't know how much these figures are public, but if there's a tech company that you love in the private markets or in the public markets, they're probably already using linear. So go check them out. Okay, I'm texting Delian, and we got him in the studio. Welcome to the show.

47:11How you doing, Deli? I'm sorry. I promise. I'm normally right on the dock. You're all good. What's up? Three for three. Three for three. Announcing it here exclusively on TVPN. Tell us what happened with the capsule. No one knows. So you're hearing it here first. At 6.13 p.m. PST on Wednesday, you know, early evening, we executed a deorbit burn, which, you know, happened sort of on the opposite side, roughly, of the globe from Australia. and we came in ripping through the atmosphere 17 ,000 miles an hour. Capsule has GPS all throughout, so we're tracking it. I actually got a good photo of me, my co-founder and our CTO, and me holding a little baby watching that GPS track sort of coming in.

47:55It's sometimes a little anticlimactic because unlike a rocket launch where you can kind of do the live stream, you watch it from the ground move up, a re-entry capsule is like moving very, very fast, kind of hard to track, kind of hard to do a live stream. And literally the way that we call things out is just like, it's got this GPS thing. And we know that the parachutes have opened successfully. Only when we just see that the GPS like vertical slows down. This is super bullish for the conspiracy. There's like, oh, there's no live stream. Did it even go to space? Who knows? Maybe he's making it up.

48:29I just think you're doing it out of the desert, you know? You need to create some type of way for Americans to bet on re-entry. Oh, yeah. That is just un-American. I mean, I know you're bringing it down in Australia, but it's frankly un-American that you're not letting us all place our bets. But congratulations. Polymarket was pushing me on, you know, you should figure out how to make more gambling in aerospace. And I was like, look, man, the easiest way is just like gamble on sort of mission outcomes. And so this is how we know we're not at peak gambling yet is there's not enough gambling on all these hyper specific technical outcomes.

49:03People will gamble on like, you know, will starship land? But I want it like down to like the individual, you know, sort of like, you know, meter of just like, is it going to take five seconds to land, six seconds to land? Like, is it going to come into the sea trajectory? Well, speaking of, yeah, well, speaking of betting and instead of P-Doom, what's your P-Dome? I want your take on the Golden Dome. What's the probability that we, America, gets a Golden Dome in the next few years? And we do have missile defense, right? Right. Like missile defense is a thing. We're not domeless right now. But like we're talking about just improving what we have.

49:40Right. We're not flying blind here, hopefully. Yeah. Let me give the sort of bull versus bear case. So this stuff is somewhat predicated on obviously what Israel has been able to show. And especially over the past sort of a couple of years, especially countering some of the Iranian attacks that have happened. If you were to like take the Israeli system and then extrapolate it to the scale of the United States, it just doesn't really work, right? They're a really small geography, very dense. It is actually possible to set up basically like missile defense batteries across their entire border. If you were to do that across like the entire United States, you just sort of border around the continental US and you extrapolate the cost of it, it's something on the order of like a$10 trillion program.

50:23Wow. And we're not fighting with Canada or Mexico or like even smaller states, like these are low flying projectiles. They're just wildly different, right? Yeah, the threat vectors are also totally different. You're looking at Russia, North Korea, Iran, etc. And so that solution set looks very different. And so that's the premise of Golden Dome. And it's the first time that they've opened the Overton window on considering things that aren't just like ground, air or sea base for the first time in the Golden Dome language. they talk about a lot of you know sort of space-based applications in particular space-based uh intercept so the idea there is like if russia north korea basically launches a missile towards the united states right right now we do have like you said we're not dome-less we do have some systems they're basically scattered from like you know guam to hawaii to alaska etc basically like all of our furthest out areas and for sure along the you know sort of border as well but furthest out areas that are closer to those adversaries to take them out you know before they get anywhere close to the United States.

51:17The idea is now you can just have a constellation of satellites that are orbiting above North Korea, Russia, et cetera, regularly. So you can take this stuff out before it even gets up into like the upper end of its trajectory. Now that type of system is also not trivially, you know, sort of cheap. So here's, you know, my bull versus bear kits, we're asking, is it, you know, sort of going to happen? We proposed a system like this in the early 1980s, right? Star Wars, right? Yeah. Star Wars days, the space development initiative, I think it was called or space defense initiative. They ran some early trade studies that had a lot of enthusiasm in Congress, et cetera.

51:51And then ultimately it fell apart partially because the like scale of the economics of it relative to the, like the, you know, sort of benefits of the defense, you know, sort of, of the nation just didn't really, you know, entirely pencil out. And so the sort of bear case for, you know, sort of golden dome would be maybe we end up in that same world where we like start to run these analyses, we do these things. And then all we do is really just like buy a couple of traditional terrestrial basically missile you know defense battery systems that already exist and we make those sensors a little better like the current you know uh one is this thing called you know sort of thad is basically like the largest you know sort of uh system um it actually doesn't have a particularly high hit rate of being able to take out the missiles on the way in and so you know you right now i think we have like 40 thad missiles and i think they have like something like a 25 percent you know sort of hit rate so it's like we can take out like 10 icbms russia has like a thousand and so you know we're like a little off on order of magnitude um so maybe it's make that one a little more accurate, et cetera.

52:42So that's sort of like, I would say, maybe not default case, but that is like the downside case of like, you know, we announced this stuff, we talk about it. When it comes down to like the economics and actually implementing this, it becomes too tricky. Congress flips from Republican to Democrat, you know, in the next election cycle, they don't want to give, you know, sort of President Trump a win. And so they decide to shut it down. The poll case is, okay, well, relative to the 1980s, there's a lot of people that it can actually do pretty near-term demonstrations of this, right? You know, obviously orbital rockets this year are launching and landing every single day.

53:14There's a lot of companies that, you know, are looking to pitch in on this that aren't just people that are going to throw out white papers, but are actually, like, very hardware rich, right? You know, there may be a lot of over-enthusiasm in the defense tech, you know, funding space and ecosystem. But, like, look, you know, we were texting about this earlier this week, like, look at what Venus Aerospace, you know, sort of just demonstrated, right? Like while there is maybe over enthusiasm and lots of funding, at least people are translating into like real hardware demonstrations of like next generation technologies.

53:42And so if there's a set of companies that before Congress flips is actually able to go and do some real world demonstrations, show that this is practical capability, get some defense funding, you know, sort of flowing into actually operationalizing those initiatives that by the time it flips, there's already something that's sort of pseudo operational or very close. now it becomes a little harder to justify it's like yeah there's some political win if you're a democrat to not give you know sort of trump a win but like yeah the defense budget has always been you know sort of very bipartisan as well so that's my sort of like bull versus you know sort of bear it's like you know for the first time in history we can probably demonstrate this really quickly and we've got a two-year window and it's a you know sort of national priority bear is uh it's pretty easy for us to just you know sort of flip back to just doing what we you know have always done uh you mentioned venus aerospace they put up a post yesterday they said today Venus Aerospace made history.

54:30We completed the first ever U.S. flight of a rotating detonation rocket engine, proving runway-based high-speed flight is possible. I don't really understand what a rotating detonation rocket engine is. Do you understand the applications of this? Is this defense tech or space tech? Is this commercial? Is this DoD program? Like, what is the story here with Venus? It's been a minute since I met up with the Venus team, but the last time that I chatted with them, the intention of what they were building was to create these, you know, sort of space planes that would basically take off from a runway, get out of the atmosphere, cross across the globe and go land back on a runway.

55:07And so that was sort of a, you know, sort of commercial case. It obviously would be, you know, sort of very expensive on a per seat sort of basis, but there's obviously, you know, sort of plenty of people in the world that would pay significant in order to be able to like, you know, get from LA to Tokyo, but do that in like, you know, in theory, you could do that in under an hour, basically. Like if you think about how quickly it takes you to orbit between those two, it's roughly 45 minutes. Yeah, this is like SpaceX point to point. Yeah, exactly. But using traditional runways, rather than having to build out all the SpaceX landing infrastructure, their plane is going to actually take off and land on normal runways.

55:39And so their engine demonstration is obviously the very key first step of being able to... And then apologies at home today. Oh, hey. Welcome to the stream. We should just spend the next few minutes just turn this into a kid's show. Yeah. At least one of our kids are probably watching at home. Let's break it down. Batman or Superman? Dinosaurs. Dinosaurs. T-Rex or Velociraptor? Fire trucks. Fire trucks. Fire trucks. I like it. I like it. What about rockets, though? Rockets versus space planes. Ooh. Rockets. I think we ought to go to our child correspondent. Is it rockets or airplanes? Rockets or space planes.

56:21I think enthusiastic about both. Oh, my gosh. I can't wait till he's co-hosting the show with our children. Yeah, we could only get Dallian for 15 minutes today. It'd be so much easier if you could just delegate this whole call-in thing to your son. It'd be fantastic. It'd be a much more entertaining guest. Okay, I know we didn't quite make it to the top of the hour, but maybe I'll go take care of this bad boy. No, this was great. It's great having both of you guys on. We'll have a great Delta V today. Yeah, we'll talk to you soon, Dallian. Cheers, talk soon. Have fun, guys. Bye. See, that is pro-natalism in action, in reality.

56:56He's not just threading about it. It's great. Well, let's tell you about numeralhq.com. Sales tax on autopilot. Spend less than five minutes per month on sales tax compliance. Go to numeralhq.com. My company's on it. Jordy's company's on it. Lots of companies are on it. Benchmark Series A. Benchmark Series A. Thank you to Numeral. And let's also tell you about Vanta. Automate compliance, manage risk, improve trust continuously. Vanta's trust management platform takes the manual work out of your security and compliance process and replaces it with continuous automation, whether you're pursuing your first framework or managing a complex program.

57:27Anyway, let's do some timeline and then we will bring in our next guest. NVIDIA, we talked about this already. This next post is great. Bryce, let's do it. That SBF built one of the most legendary private investment portfolios of all time tells you more about the business of venture than a thousand podcasts on the subject ever will. well what about this podcast bryce because we're we're saying we're saying what you're saying he did he did make some good bets and nobody can take that away from cursor cursor and anthropic very very even though uh david tish yeah friend of the show was also in the original cursor round said that he didn't get it wasn't like 200k to 500 million dollars which was the number circulating around he said there's no way that that would math out can you imagine if sbf is like secretly got like co-founder shares or something or like got like an incubation type deal so he did get that massive stake in 200k who knows i don't know but now someone else owns it financial investor yes somebody was able to buy out that cursor position and i wouldn't be surprised if we had him on the show at one point maybe future guests maybe it might have been in the audience they might be listening right now they're probably listening right from their yacht in the amalfi coast stop that one bet basically i mean it's enough right uh crazy anyway uh we already covered the uh the we should cover the brian yeah brian armstrong news so what coinbase basically cyber criminals bribed and recruited rogue overseas support agents to pull personal data on one percent of coinbase uh coinbase's mtus no password private keys or funds were exposed prime accounts were untouched uh and coinbase has committed to reimbursing users that were basically you had to be impacted by a social engineering attack so people weren't getting support agents to move funds around funds weren't stolen like that but it would be let's say somebody gets your personal information you get a random call and they say hey we were talking about this how the spam around coinbase was getting crazy right you'd get spam text saying like you know click here to log in or something.

59:34No, it's truly, it's truly, I mean, it's like - It felt like a hundred acts like two months ago or something like that. It's a great business for these scammers, right? Like the scammers are, it's just whatever money they make is pure profit. Yeah, I wonder how much of those phone, social engineering phone calls now are happening with AI. I don't know. It has to be a good percentage. I mean, the spam calls I would get when I pick up were ridiculous. Just recordings with like music on them. and it just didn't sound, it didn't sound anything like an actual call that you'd get ever. Yeah, and the concern here is that this data is floating around now and people can find out where big crypto holders live and find out what they look like.

1:00:15There's ID information, you know, as part of this. And so it's a huge risk. If somebody was on Coinbase and they had, you know, 10 Bitcoin, now somebody could go to their house and say, I would like those 10 Bitcoin. Yep, transfer them to me. Very risky. So it's super unfortunate. But it seems like Brian did the right thing and responded very well, like with the direct-to-face camera. Yeah, the response is very interesting. They asked for a$20 million bounty. He's saying, we're not paying you the bounty, but we're willing to pay$20 million to anybody who gives us information leading to the arrest.

1:00:51Isn't that a plot of ransom? Oh, yeah, you haven't seen it. And so it sounds like a movie plot, but what happens here is that there's probably multiple criminals involved in this. And so let's watch them turn on each other because somebody's like, well, if they're not paying the bounty to our criminal group, why don't I turn on the big boss, get him in the clink, get the, you know. That's genius. And so anyway, some interesting game theory. And good founder-led comms by Brian putting up the video, just, you know, not overproduced, just, you know, almost stream of consciousness, obviously thought about what he was going to say, but doesn't come off as stiff or callous or not taking it seriously.

1:01:29So good job to him. Yeah, the information is name, address, phone, email, masked, social, so the last four digits only, masked, bank accounts, government IDs, account balance. So anyways, not great, but I think this is the best response they could have given the circumstances. And again, this is just very rough if you know, you're, this is somebody who lives in a random apartment somewhere and suddenly they have to be thinking about, do I have to be worried about real life? You know how you're going to authenticate your bank account in the future. world. That's right. You can't social engineer that.

1:02:09And we got Alex from WorldCoin in the studio. Welcome to the stream. How are you doing? What's going on? Tools for Humanity. Founder of Tools for Humanity. Sorry. WorldCoin is one of the coins in the world, the orb. There's a whole ontology of technology here. But thank you for joining. How are you doing? Good. Thank you for having me. I'm just at the Andreessen Horowitz LP Day. Oh, cool. Yeah. You just got off stage? I literally just got off stage. So I almost was a little too late. But I'm right now in Las Vegas. First time, actually. First time in Las Vegas. So I'm really excited. Wow. Narrative violation.

1:02:42Somebody building in crypto that hasn't been to a crypto conference in Vegas. No, it's great to have you. We've been wanting to have you on the show for a while. Yeah, it's great. Glad we made it happen. And at times, nicely with your guys' entrance into the U.S. market in a big way. Yeah. I mean, maybe you should kick us off with kind of like an overview of where the company is, where you started. I know there was an international component. Now you're in the U.S. There's different products. There's different ways to interact with the overall ecosystem. Kind of give us the state of the union on Tools for Humanity.

1:03:17Yeah. So maybe starting right from the beginning, so a little over five years ago now, five and a half years ago, Sam, Sam Altman from OpenAI, and actually had part of the initial idea of this. And we met. I was in AI before as well. It was in theoretical physics and deep learning. And so both of us believed that AI will continue to make a lot of progress and very likely we will see AGI within our lifetime, which back then was not like a common thing to say. And of course, both of us believe that this is mostly going to be a tremendous force for good, and it's going to drastically accelerate science and technology, but also that we will need global scale infrastructure to kind of really make this a great outcome for everyone.

1:04:05And so we started a company together called Tools for Humanity that really had that as a mission, is like build global scale infrastructure to help with that. And then the actual kind of coming together with the company, there were two main ideas. One was around the fact that as AI continues to make progress, we will need some form of proof of human that is at internet scale. Otherwise, many of the things that we care about will start breaking down. Because obviously, as a society, we form our opinions on the internet, on our social networks. We meet each other on platforms like dating apps. We entertain each other with games that we play with each other through the internet.

1:04:52And like the moment we have not only passed the Turing test, which I think we did in the last two years, meaning now we have AI systems that we can talk to and we cannot tell anymore just by talking to them that in fact is an AI. But also that we are now about to enter, of course, like strong agentic AI systems, real time video generation, all these kinds of things. And so we will need a proof of human internet scale. Otherwise, social networks, many of that, places where you meet online, et cetera, will start breaking down. And so this was idea number one. It's like, how could you build such a system?

1:05:29And once you have built such a system, you can use that to launch a digital token by giving ownership in it to eventually every human. And as a result, you would create what will turn out to be the largest real human network on the Internet. And so it was a very humble vision. Quite. By Sam. And so we really kind of we took it very seriously. We thought about it for a long time. And back then really thought about how would you need to build such a proof of human. If you assume what we did, which is that AI will become increasingly better. And then many of the initial ideas you could have on how to build such a system, like, why don't we just use our online reputation?

1:06:15So like our accounts that we used in the past. We built some kind of reputation graph. Or what about if we just rely on government at any systems? Or what if we just use phone cameras to get some kind of signal? All of these, we realized pretty quickly, will either just break down as a result of AI becoming more powerful and better. Or it just doesn't have the properties that we think such a system will need. It needs to be global and it needs to be fully anonymous and privacy-preserving. All of those things. And so, well, back then we realized we will likely have to build a physical hardware device that we have to distribute all over the world.

1:06:53And at some point get almost anyone that uses the internet to verify with such a hardware device and that everything else will very likely break down. And that was like a very, very crazy thing to do five years ago. So like people mocked the company for a long time. And it was like just a crazy thing to work on for quite a while. um and so essentially talk about uh just going deeper there you guys uh went to market internationally first i'm sure you had a lot of temptation to really focus in san francisco early on right this is a an area where there's an extreme density of people that understand this broader vision that you guys have so i'm curious like thinking about um you know the decisions that that went into that go to market and then also giving our audience a sense of the scale of the operation because i don't think people fully process just how large the operation is so um first to the to the first part of the question which is why did we not launch the united states much earlier um that had the simple reason that because sam is a co-founder uh everything we do has a lot of visibility usually.

1:08:06And in the last administration, there was basically no regulatory clarity around how to behave as you build these crypto networks and kind of what are the things that are allowed, which are the things that are not allowed. And SEC, of course, had a posture of enforcement. And so given the large visibility of the project, we just took everything always through a very cautious lens and just decided that we will only enter the US once there is a clear path to regulatory clarity, which I think is now the case. And so now we're really excited to kind of make the service available. We launched two weeks ago in the US.

1:08:46In the US itself, it's still a meaning kind of pretty small operation. It's going to take us a couple months to really ramp this up. And just to give you an overall sense, we're now at 20, 25, 26 million users in total in our app world app which is essentially the initial client to make this network useful uh but kind of you have to think about that there's going to be many clients that will use this this network um but but still and then we have 12 million uh people that actually are verified uh really all over the world from south korea japan uh to um europe to latin america and so yeah the company is now around four or five hundred people so tools for humanity and it's a pretty complicated thing to manage because you have everything from on-the-ground operations that are somewhat complicated and a lot of things can go wrong to of course hardware manufacturing and ramp up to a lot of software so it's been quite a journey.

1:09:45What is your background? Have you done crypto stuff before or hardware stuff before or managed huge like workforces before because you're doing a lot of stuff and I'm wondering like No, I was literally a theoretical physicist. So I used to sit at a desk all day and do math and write code. That's fantastic. I did a decent amount of self-engineering just because already back then clusters got larger. But yeah, I didn't do any of that. Yeah, talk about how basically talk about bootstrapping the network and the user base with the token. right and um because that's i don't know i think i have a good sense for why you would do that but you know the the sort of boomer pushback would be you know why does this need to be you know crypto and i think you guys have good reasons for that yeah yeah i think there's two reasons for that like first of all of course appreciating that crypto still has like a meaningfully bad reputation just given everything that happened but i think um there's like real technological reasons of why you need to do or why I think it's best to build such a platform that way.

1:10:52So one is, as I just mentioned, bootstrapping where all of these networks that we use, of course, they're absolutely meaningless if they're not at scale. And so, like, that applies to social networks, also applies to financial networks. And so maybe one of the most notable examples of that was the launch of paypal where um you were able to refer your friends your friends had some amount of us dollars in their paypal account and and very famously um paypal spent a lot of kind of a huge amount of the renter funding i was of course not there so i don't know how much exactly but a huge amount of the venture funding to get this network to critical scale with that referral program and that then led to network effects and that then led to this turning into among many other things of course into a successful platform and so um the same applies here is just that these uh crypto networks are valued at billions of dollars if they're somehow working and so i think we can do uh something similar just at a much much larger scale and so we can use very likely billions of dollars to kind of really get this network to scale and so that means that everyone that actually joins this network gets a small piece of it uh through the worldcon token and so you actually receive ownership in the quite literal network.

1:12:15But also, of course, that is an incentive to verify early on where maybe the utility of the network is not fully there yet because it's subscale. And so that was that idea. And then the second idea is, of course, that like, this is going to be one, very expensive to build, but then also extremely valuable. It's going to be very valuable to many of the largest internet companies, very likely if we succeed in our mission. And so we need a business model, but not for us as a company, but for the entire network. And so that is the second piece. I think these tokens actually allow you to build a sustainable network.

1:12:48Yeah. And I think now we're actually bridging that gap where it's actually becoming quite useful. We now announced the partnership with Match, which is the company behind Tinder, Hinge, many of the dating apps to actually bring proof of human to these dating platforms. uh partnership with razor which is uh one of the largest hardware manufacturers for gaming hardware to turn that into the standard for for the gaming world so i think like we're actually getting there now pretty quickly uh but of course it's still early can you talk about the scale of bot activity online i have to imagine a lot of people are interacting with bots daily that they don't necessarily realize are bots right there was a high profile issue recently uh with reddit where you know somebody was running a scaled influence operation experiment you know leveraging you know leveraging the power of AI and for those that don't know people were that the AI would effectively look back through somebody's comment history and deeply understand the person and then make arguments to them based on their sort of pre-existing beliefs which is very powerful and and obviously it seems that you know all the users were not aware that what was happening And I just have to imagine that's happening, you know, at a very wide scale.

1:14:04Yeah. So no one really knows, of course, the actual scale of the situation. But I think the paper that you outlined is from the University of Zurich. So as you described, the University of Zurich actually ran an experiment of changing public opinion by using AIs to respond, to just like a comment in subreddits. and they actually have been quite successful in changing the opinion of these subreddits, which is kind of crazy. And so, of course, we have like a similar problem, probably at meaningful scale on X and very likely now every other social network.

1:14:42Maybe, so dating also already at quite a meaningful scale. Like you have these now, these accounts that like have photorealistic images and start texting with you and everything. But I think like maybe the more interesting part is that I think we're at 1 % or something of what I think will happen over the next 24 months. I think a big trigger point will be once you have an open source, very competent agent. Because that's where things will get quite exponential. And we're like, probably 90, more than 90 % of almost all activity on the internet, almost all content on the internet will be AI created sometime after.

1:15:27So that will lead to the fact that I think for now or until quite recently, by default, we trusted everything that we have seen and we assumed that it's like authentic. I think that will completely flip 180 degrees to by default, we don't trust what we see. We don't trust who we interact with if there is not a way to verify the claim. So it's going to be quite a profound shift. uh what was your initial reaction to the to the coinbase news which was this morning obviously very unfortunate uh potentially leak of you know a bunch of uh personally identifiable information home address addresses balances things like that is that the kind of thing that in the future could be avoided through utilizing your network or is that just sort of a reality of of you know finance today so my first reaction was that i think it was a very very strong uh reaction from brian huge huge fan of brian's of course but i think um very clear message uh very clear next steps uh and these uh these things they are unfortunate uh but i think this is like it was somewhat at least from the outside of course i don't know the specifics but it seems like a a relatively sophisticated social engineering attack um i don't think what we do will be able to help with something with customer agent social engineering like i think that's a very specific problem but i but i mean more on the kyc side is there a world 10 years from now where where somebody is effectively able to kyc using the world network oh yeah i think i think that will almost certainly happen uh yeah because the issue here was like you know somebody has their government ID tied to a home address tied to a balance.

1:17:14And then that creates a risk vector, which is why Coinbase is taking it so seriously. What about kind of centaur applications of artificial intelligence? So a situation where someone's gaming and they're verifying with the orb or their eyeballs, but they're still using AI. I mean, we've already seen this with a real person who's on a dating app but they have a second app where they're taking the text putting it in there like the riz gpt uh and the the responses are still ai generated but there's just one person involved is that less of an issue this centaur model because there's still a human in the loop versus there's one person controlling or puppeteering like a million accounts yeah i think that i think by by in a couple of years i think almost everything we do on the internet we will do with help of an ai because it will just make our writing better will make our thinking clearer and so i think that is actually not really a problem i think um and in some sense the way we actually think about it is we think a lot about agents and agent delegation these days and for example i think one thing how this will be very useful is you will need to understand that behind an agent uh what an agent actually acts on behalf of a human um or like a one human and as you described i think the the the important uh property of such a system is that you cannot deploy uh thousands or tens of thousands uh of these ais um not to not allow you to interact with that and maybe actually the gaming use case there's a cool example here where with razer they they they build these gaming webcams.

1:19:00Yeah. And so when you actually verify for world, you receive a package of data that is not stored anywhere. Essentially it's stored on your phone. And one of the things that has actually assigned face image. And so what Razer will be able to do, it actually will use that to ensure that this is, you're not a deep fake. You're actually the person you claim to be. And so you can authenticate a live video stream. And I think the same will happen on video calls. Speaking of hardware, we were just talking about Apple getting into brain-computer interfaces. Neuralink is also in the game. Is there a situation where authentication via BCI is as effective, more effective, something that you're partnered with or developing?

1:19:48or is that just on a different timeline from what you see the rollout of a super intelligence or agi uh being i well so personally i'm very interested in bcis um but i i think this is very much on a different timeline so i think like to yeah deployment of invasive uh or even non-invasive pcs i think it's like still certainly five plus years away probably 10 15 um so i don't we will figure it out once it gets there i would say yeah yeah um what about um i'm super interested in understanding how the decisions that you're making allow us to read into your agi timeline sam's agi timelines and what the future will look like there's this interesting world where the kind of the revealing feels like you see a future where there are tons of digital AIs in the world, but maybe there's not this super intelligence that can reconstitute matter at a atomic level instantaneously, the gray goo scenario.

1:20:58Because in that scenario, even in the good ending, you would imagine that a super intelligence would be able to create a human eyeball, grow it in a lab, do something to create a fake version of the human head, right? Maybe scan me one way or another and then recreate the eyeball. And so much like you could potentially fake a fingerprint reader with enough time and effort and detail in how you're constructing that matter, you would think that you'd be able to do that if you had unlimited resources and super intelligence and all these different things. But that doesn't seem to be the timeline that you're operating against.

1:21:36So can you tell me about like how your far future vision for super intelligence plays out a little bit? So, well, I think about these things quite a bit. I think so this kind of also like Ray Kurzweil vision of like eventually we'll have AI that creates nanobots that will be able to reassemble matter, et cetera. I think that's um that is very likely to happen but i think as a society i think we'll like there's going to be a lot of other things that will happen before we get there and um so i guess my internal mental model is that we are i think still at least 10 years away from from from that kind of uh level of intelligence or at least from us allowing that level of intelligence to interact with the real world um and then actually if you well if you if you don't think about the fundamentals of kind of physics in such a scenario is uh that of course what we what we do to to measure that humanist is we use we fundamentally use photons of different wavelengths so near infrared uh visible light etc and so i think like before you would actually create an artificial human such an ai would be able to maybe just emit multi-spectral wavelengths to fool such a system.

1:22:58And so like, well, but I think then we will also use such a AI to build a countermeasure and build a more system. So I think that is, in my mind, still far out in the future. I think like all the medical advancements and scientific advancements from AGI, I think. Is that generally your mental model for how all of this progresses is just like, good guy with AGI beats bad guy with AGI. It's kind of an economic or energy warfare, whoever has the more compute, the more, and as long as the, the, the good people have more resources, they will be able to build stronger defenses. And so the net outcome is good.

1:23:41Um, maybe that's like one way to frame it, but like generally I'm, uh, I think I'm way more optimistic than than kind of most people or like many people are in the tech world i think like the default outcome is that um these ai systems would just be incredible tools for us and i think they will be widely accessible and i think the the frontier labs will make these accessible to kind of a wide population for quite a long time um like that at some point you might get in a kind of this true super intelligence territory where maybe the government steps in steps in i definitely see that happen yeah um and then it becomes like a geopolitical uh situation um which is going to become like very hard to predict um but i think until then i think these ai systems will be relatively widely available and open source will not lack too much behind um so yeah it seems like most of your model is like general optimism about how agi and ai progresses but there are pitfalls that need to be avoided and there's problems that will need to be solved in the interim and and world coin is one instantiation of that one problem to be solved are there other problems that you're thinking about that maybe you're not working but other founders or other entrepreneurs or other companies might be thinking about as we progress into the agi future well so first of all maybe the framing about world i think you can definitely do that uh but i think the other framing is as a result of the technology i think we will create one of or if not the largest real human network on the internet which i think will create a lot of value so like it's like it's not just preventing the bad it's also creating the good yeah that i think uh really matters here um you know other problems for other there's like there's like so much it's like what what what uh you know i feel like the main you know there's this um the world is undoubtedly controversial right?

1:25:41You have people that are super excited about the potential of the technology and understand the importance. And then there's maybe people that are excited and understand the importance, but they're still wary. Uh, and then there's like the whole other side of people that are just like, no, you're never going to scan, you know, you're never going to get my eyeball. Don't even, you know, keep, I don't even have pre-check. Yeah. Yeah. Yeah. Those, those types. Uh, uh, but, uh, but, but what do you say to the people kind of in the middle that are kind of like, um, interested but kind of wary or maybe on the fence, you know, when you're talking to them one-on-one?

1:26:16You know, I think like we have very, very high conviction around both the importance of this technology and how the technology is built. Like, I think it has all the properties that we will need as a society for such a technology in that sense that it's anonymous, it is scalable, it can be inclusive like all of those things i think will end up mattering a lot like maybe much more than is kind of visceral uh at that point in time but i think in the next 12 24 months i think it will become relatively obvious and so i think um it's going to be interesting where like i think different parts of the world will end up with different trade-offs like maybe some parts of the world will just require government ids on pretty much every part of the internet and i think that might end up being a really bad a bad situation um and so and that's bad because somebody would just effectively sell their id to be rented out for no because like ultimately uh it will be really hard to build that as a not traceable system uh by the government and and and i think like it's of course something we really believe in here in the us is like the freedom yeah so the government would track you on every single place you go on the internet they could not saying they would and i think it really depends on which part of the world you're in sure but i think that's just not a great outcome and so i think if we do like if we do everything in the right way over the next couple of years i i hope that our brand will become something like the signal messenger or like i think totally um this is like the the anonymous high trust uh solution that you can use and other people will have other solutions i think there will be a lot of competition around that space because i think it will become a relatively big one um so yeah if others will want to use other options that is that is totally great i think we will win by building the best product and reaching the most scale jordy great place to end yeah this is fantastic thank you so much uh very excited to see the rollout uh i actually did i'm just remembering i had one last question uh are you far as far enough along as you would like to be or do you wish you could just sort of like pause time and scale the WorldCoin network just for another year to sort of catch up?

1:28:31Because again, when you talk about these timelines around 12 months, 24 months, you guys are really racing against the clock from what it sounds like for a world in which we have these sort of agentic reasoning systems that will really make the internet a much more wild place. Well, I think that is definitely one perspective in my mind. I think we're definitely in a race against time. And what is interesting, what really only happened in the last six months is that CEOs of many of the very large companies that you know with large products, either we talked to them or they reached out. And the problem is like currently we cannot serve that scale.

1:29:19So there's like, there's like a lot of pull for the product to be available. And we just really need to get there. We need to roll this out faster and be able to serve these big platforms. systems um so that i think there's like a extreme level of urgency for one but then the other side is it's hard to describe how crazy it feels to be even here uh from the beginning of the company like for like the first two to three years uh well people basically just made fun of this um and and so like yeah it's certainly personally the journey of a lifetime and it and like when when I started working this, like I gave it a very low probability of success.

1:30:01And I did so for the first three years or something. It's like, yeah, still very, very long to go and fast to scale. But on the other hand, it feels pretty wild to just be here right now. Amazing. On the social network thing. Sorry, last question. We're like, all right, thanks, Alex. Thanks for coming on. I mean, when you say large scaled network valuable, are we talking Visa network? Are we talking Instagram. You're going to see. Yeah. I mean, I'm interested to see the business model, the pricing model. Are the big platforms going to be paying in WorldCoin? Are we going to have a national reserve of this stuff?

1:30:39I don't know. We'll have to have you back on when there's a big announcement. Looking forward to that. Thanks for having me. Cheers. Fantastic. Thanks, Alex. Anyway, it was good. We broke because we got to talk about Eight Sleep. They got a five-year warranty 30 night risk-free trial free returns free shipping pod five ultra pod five ultra i think you beat me i got an 88 i think you got 92 right i think the 18 must have gone in the app and and uh just give me a couple of boosting points whatever john gets just give geordie a couple points four more i got a 92 92 let's hear it for two hours of deep sleep congratulations uh we got josh in the studio welcome to the stream josh how are you doing haven't seen you since Hill and Valley.

1:31:20Yeah. With a tie. No tie. Oh, no tie today. Well, we'll get to you next time. Look at the games though. But he's looking great. Josh, what's your workout routine? You're looking jacked. Oh, man. We do basketball. Got some jujitsu. There we go. Yeah. We do it all. That's good. Yeah. Got it. Let's talk about the latest deal. Reflect Orbital is in the news. Take us through the anatomy of the deal. break it down for us. You know, amazing entrepreneur, combination zipline, SpaceX, guy Ben Nowak, Sean McGuire, friend, partner at Sequoia was early. He and Alfred seated them. We led the series A. It was one of these ideas where it's like, you've got the sun.

1:32:10It really is only available for half the day. And they had a very simple insight, which is that there's so many satellites that are launching, what if we took a giant Mylar balloon effectively and had this big planar area that we could basically redirect the sun and everything from solar efficiency so that people that are running solar cell farms could basically get, you know, double the output to people that were doing search and rescue or military operations. You know, where could you literally task a satellite, not for visual imagery, but for sunlight. And we thought that that was a very clever idea.

1:32:46So we funded them probably a few quarters out from formal launch. And the inbound has been insane from all over the world of people saying we want to be able to task satellites to have directed sun wherever we want it, when we want it, which is pretty cool. From governments or enterprises or both? Yeah, you can imagine folks in the Mideast, folks where there's actually money at the government level, but no way that they could possibly do infrastructure for streetlights at night. And so, yeah, there's a lot of applications that have been popping up that we here before never imagined. So it's one of those things that develop a capability, don't under promise, you know, don't over promise and under deliver, do the exact opposite.

1:33:30And people are coming to him. So yeah, we're really excited. And he's super smart, super, super sharp. Yeah. What do you think are the exciting second and third order effects of something like this, right? If you make an area that's dark for most of it, you know, not most, but, but some percentage of a 24 hour period and you light it up, I can imagine that would have positive impact. You know, I think there's a bunch of data on like streetlights and crime. It's big for the Andrew Huberman crowd. Well, yeah, I don't know. I don't know. Andrew, Andrew might be, uh, might be like, Oh, you're, you're disrupting my circadian rhythm or something like that.

1:34:02But no, but isn't there, there's a ton of data on like streetlights and crime right it's like if you light up an area like there's a massive reduction i'm curious if you've thought about um kind of the the potential externalities of the technology over time well the first one again is energy right so if you're able to produce electricity and solar is getting way cheaper and way better but the efficiencies are still 50 of the day when you have sunlight um and then you're doing battery storage but if you could extend that in certain areas and particularly if there were sort of adjacent farms that weren't lighting up the city and screwing with people's circadian rhythms that then could be transported through electricity, through storage and electricity.

1:34:38Transmission. I think that that's exciting. Yeah, sporting events, late night soccer games, you know, all the kinds of things where in New York City, it's no question, you know, and in Palo Alto, it's no question to be able to light up stadiums. But if you wanted to light up an area that was an entertainment zone or, you know, you can imagine things there, for sure, implications on safety, again, on search and rescue. You know, there's a reason that we always say whether people are hewing towards elements of honesty, that sunlight kills all. So yeah, I'm a big fan of the sun. This feels like one of those deals that kind of lives and dies by the like specific variables in a spreadsheet.

1:35:14If launch costs are a little bit higher, it could be really, you know, they could get kind of stuck if they don't fall enough or, you know, the distribution of sunlight that's not concentrated enough, all of a sudden doesn't make economic sense. Is this more of like a bet on the founder or Or have you dug into the spreadsheet and are you really confident on the model evolving? Or is it more like the team's just so good they're going to go figure something out? Well, I would go and say there's different economics for different use cases. Totally. If you're a military and you want to light up a battlefield, you're probably willing to spend a lot more than - That's very different than just the marginal solar user who maybe just needs a little bit of energy.

1:35:50For sure, search and rescue are going to be punctuated emergency kind of things where people may not spare a cost in military as well. in other cases obviously military is going to want the cloak of darkness right and so they don't want to light some things up but the honest answer is on the first part I don't know what the pricing is going to be here we're comfortable first and foremost with an entrepreneur who is so thoughtful about every aspect of weight performance the material science behind it the launch costs the capabilities the cadence the frequency and so I think it's one of these things like build it and they will come and there's a little bit of faith in that but I have a lot of faith in Ben I think he's recruiting extraordinarily well i think he's deeply technical he's obsessed i mean truly like obsessed like you know a lot of people do all kinds of things in their spare time he's reading like math textbooks just for fun in spare time um so super super space nerd really talented uh yeah and lux and sequoia are uh you know forgive the pun but uh excited for it to see the light of broadly, launch costs have been coming down.

1:36:58There's been projections that they're going to come down further. Have you been pleased with the trend of falling launch costs? Are you seeing enough in the entrepreneurial burgeoning space economy? Are there going to be a new wave? Are we in the midst of a wave? Is the next generation thinking about other orbits, MEO or very low Earth orbit? What's exciting to you in space these days? I'm just going to give you a cascade of yeses. Yes, yes, yes, yes, and yes. There we go. Look, cost per kilogram to launch things up into space was the main limiting metric before. And larger vessels, better propulsion, more frequent launches, increasing demand, all of that has lowered that.

1:37:41When we first did VARDA, it was the inverse analysis, which was instead of trying to figure out how do you get low cost per kilogram up into space, it's how do you actually develop something that is going to be high cost per kilogram to justify doing it in space and coming back down. Same thing for another. And by the way, Varda, you know, I know Delian's been on. And yeah, but I'm so proud. Third launch successfully just yesterday, you know, in the past 24 hours.

1:38:07Quiet down, guys. Yeah, calm down. You know, Gruy and Delian and team, truly proud of them. Proud to be partnered. It is just awesome. And, you know, you're going 25 Mach, 25 times the speed of sound. You know, the hypersonic testing people have talked about the hype around hypersonics. It's real and really proud of them and their launch and reentry capabilities. A related one, which was Tom Mueller, who, as you know, is Elon's right hand guy at SpaceX for 20 plus years. We backed him in a company, Impulse Space. And this was one of those speculative things of how are you going to invest in a company today where there's no economy and no demand yet for the ability to transport things and move them into space once they're up there.

1:38:49and that's really what he's developing the vessels and the capabilities that once assets are up in space how do you think about whether it's cargo transport or moving satellites and all these kinds of things so um there feels like that impulse could like unlock an entire new class of startups built on the stack of impulse plus spacex you get something up to leo and then you push it higher and you know there's some examples of things that can happen but i feel like if you drop the cost 10x 100x or something you're gonna see a whole different breed of startups right totally and in fact a lot of our thinking around this was um you know it's such a cliche thing that history doesn't repeat it rhymes you know but if you go back to history and you look at one of the great build outs in this country that unlocked commerce and transport of uh material and populations and lives it was the rail and uh you know so many things have happened during rail for people to compare to booms and bust cycles.

1:39:43But if you look at rail, you think about the tracks that were laid down horizontally, and you were to flip them 90 degrees. And instead of tracks, now you've got propulsion going up to space. It's very much the same thing of how do you get transport number one and who's going to sort of own those lanes. So that's launch capabilities. Then you've got communications. There's a reason that telegraph lines were laid proximate to the rail. And it's the same sort of thing. Now, instead of telegraph lines with actual wires, you have satellites doing KA and KU band. And you have everything from Starlink to our company, Kaimeta that we do with Bill Gates, where it's KA and KU that are basically switching off of a solid state material with no moving parts.

1:40:16You know, when you're on a plane and the reason that you lose internet for two seconds or whatever is it has lost track with a geostationary satellite, you know, and of course it's tracking it. And as the earth moves, it's tracking it. But if you're in a low earth orbit satellite, you want to be able to track it just like when we're moving through the city and going from cell tower to cell tower. And so that capability is something that's relatively new for being able to lock on and track satellites. Then you've got people that are making things in space like Varda. You've got people that are transporting or storing them.

1:40:46There's other companies that are doing effectively private space stations because, as you know, ISS is coming out of service. You've had geopolitical considerations of who's partnering with Russia or China. And so there is, I would just say, a very robust space ecosystem driven by the fact that capital follows talent, talent follows breakthroughs and ambition. And there are so many young, smart men and women that want to work in the space. And in many of them, they were in the pressure cauldron of SpaceX, which I think is an incredible culture. You know, as you know, I'm critical about Elon about a lot of things, but I think SpaceX is an absolutely amazing business.

1:41:21And I think people that are attracted to it have been trained there are now spitting out are incredible. Yeah, I mean, the Varda story is fascinating because they started, I remember the very first pitch was for like, we're going to make ZB land in space, then there was pharma, now they're doing pharma and some defense and hypersonic testing and stuff. And it's just a testament to like, you bet on the founder and they'll go figure it out, but they are riding a really, really important trend. Totally. When, when, when, when, uh, Delian was first pitching that with Brewey, I was like, I have no idea if this exotic optical material is going to be the thing, but the capability of you doing this is going to be the thing.

1:41:55And it's really about that economic inversion, not dollar per kilogram up, but high value dollar per kilogram down. And I think even Sean, who now we're partnered with in Reflect made that comment of like, he was focused on the micro and he sort of got that wrong or maybe he got that right actually. But the macro, you know, maybe he missed and super honest, self-reflective. I think with Varda, he said the opposite. He said he missed the micro. Oh yeah, yeah, yeah. He got the micro wrong. It wasn't going to be Zeebland, right? Yeah, yeah, yeah, yeah. That's right. He got hung up on that. Yeah, he should have bet on the macro.

1:42:29Yeah, it was great. I think an underrated just story or fact about you is that you've been in venture a long time can you tell us the story of like the first fund and how you even got into venture and kind of what you've learned over the last it's been more than 10 years has it been 20 years now how long you've been doing this so look I'm a science nerd I was doing HIV AIDS immunopathology research and I literally got into that because I watched an HBO movie when I was like 13 years old called and the band played on. What was it? Was it HBO? It wasn't HBO Max back then. It was just HBO, right?

1:43:03They swam back and forth. Old school HBO. And it was like this ensemble cast and I had the right ambitious naivete, which everybody that we ever back does, which is like, I'm going to go cure AIDS. Anyway, I ended up working in a scientific lab, the scientific lab three, four days a week after high school, finished that all the way through college, published in two different scientific journals, thought I was going to go get an MD, PhD. My mentor was trading futures and options. So we'd be sitting there with a centrifuge of AIDS blood spinning down, waiting to run some 96-well enzyme-linked immunosorbidant assay thing.

1:43:35And he's making money, and I didn't know anything about the stock market. I was raised by a single mom, and she was a resource room special ed school teacher. And I got enamored by capital markets. And my life since then has literally been the intersection of science and finance. And it is partially the satisfying thing for my own ADHD of being able to constantly meet new founders, and I never knew who I'm going to meet. and then coming up with certain feces and running them down and either starting companies with founders or finding the people that are in it. When we started, Peter Hebert and I, who's absolutely amazing, I mean, he's like literally my dispositional opposite, very much like my actual real-life wife.

1:44:10He's smiley, he's positive, he's optimistic. I am usually in all black and negative. Everybody here has been indoctrinated with this idea that failure comes from a failure to imagine failure. Pete is like, well, what if it works? You know, what if it actually becomes a multi-billion-dollar business? And my wife, Lauren, he and him are very much the same. They're smiley. I always say, you know, I've got resting bitch face. And it's just, it's a great dynamic. People joke he invented the airplane. I invented the parachute. It's a good yin and yang. When we started, we had friends and family to go out and raise money for Lux.

1:44:41And I joke that we had friends, we had family. None of them had any money. And we got lucky and met a guy, Bill Conway, who was one of the three founders of the Carlyle Group, which at the time had maybe six or eight or 10 billion at most. Today, you know, hundreds of 400, 500 billion. This was fun for ants back then. And we met with Bill. And I always say, look, the counterfactual, and this is true of all of our lives, and anybody listening, and any entrepreneur starting something, you just never know. And he was in the right mood that day. Maybe he had a great breakfast with his wife. Maybe he found out they just made a lot of money for a deal.

1:45:12Maybe he closed a big LP. Maybe whatever it is, he got good news. He was just in a good mood. But the counterfactual could have been he was in a bad mood. He was pissed. He was angry. He was frustrated. He was hungry. And we came in and we pitched him on this idea that in the history of venture, every 10 or 15 years, there's some secular wave in technology. In the 70s, it was PCs. In the 80s, it was biotech. In the 90s, it was TMT, technology, media, telecom. And our view was like the next wave is going to be the physical material sciences and where they intersect with computer science and all this kind of stuff.

1:45:37So it's like the interstices. And it wasn't going to be just Stanford and MIT. It was going to be like Cornell and Georgia Tech and University of Michigan and UT Austin, all these kinds of places. And physics and material science and chemical engineering. And so he said, I hope you make a billion. And he believed in us, gave us our first pledge fund. We were writing small checks. We had maybe board observer seats at best. And then, you know, a bunch of those things were doing pretty well. We were building a little bit of a reputation. And then we went out to raise our first real institutional fund, which we called Lux 2.

1:46:08Because everybody likes a second fund, right? So, like, nobody would invest in a first-time fund. But if we called it Lux 2. There you go. Lux 2. This is like announcing a preempted round. Every, we've been saying every founder should say that every round is a preempted round. Because it just looks better. So Bill becomes an anchor investor in that. And we get this like pantheon of people. Pete Peterson, who's the founder of Blackstone. And Stan Druckenmiller, a legendary global macro investor. And Ken Griffin, founder of Citadel. And it was all random connections that led to these individuals.

1:46:39And they were writing, you know, sort of like five,$10 million checks. And then we got a whole bunch of family offices, some small fund to funds, a few corporates like Lockheed and Motorola. And we could not hit our$100 million target. 92.1 to this day I remember every person that said yes or no every hundred thousand dollar check the people that have been with us for 20 years and the people that said no that we would later on because I got chips on my shoulder uh we wouldn't let into the front let them back in yeah but um so so I'm very thoughtful about the people that we ever say no to because you never know in two or three years they're going to be the people that you really want to back but yeah we we started small and uh today we're five and a half billion and uh but I still remember those those those those early days.

1:47:18That's fantastic. Talk about the new science funding initiative. You guys have been following a lot of the cuts, funding cuts. Yeah, we talked to a couple people on the show about the importance of basic science research, funding things that don't have immediate economic impact. What's the impact of a helicopter on Mars? What's the impact of understanding DNA at some atomic level? Yeah, things that you can't. Stuff comes out of that, but it might be a decade. there might not be a typical venture payback. What are you thinking about this space generally? Well, first of all, the roots of venture capital are really two things.

1:47:54It was deep science and it was defense. So defense tech itself is nothing new. It really is the early days of the venture capital industry. Genentech, people forget. That's one of the greatest venture bets early on. And Cohn and Boyer, and that spun out from the UC system. That was one of the early important proof points that helped to create the Bayh-Dole Act. So you had two senators, Evan Bayh and Bob Dole, that basically said, look, all this taxpayer money that's going into universities, they're producing property, intellectual property in the form of patents. But why don't we allow the university to actually own those instead of it being like marching rights from the government?

1:48:29And what that did was just blew out. And it happened to coincide with the ERISA Act where retirement money could start going into private equity and venture capital. That was also in the 70s, the late 70s. the virtue of both of those things was that you had now this new class of intellectual property spawned from taxpayer-funded research that went from NIH or National Science Foundation, National Institutes of Health, the sort of three-letter agencies going into academia. They would hire postdocs. They would do work. They would file some patents. And then there was this well-trodden method, which we happen to be quite good at, where you would go to university, you'd go to their tech transfer office.

1:49:05Actually, most of the time, you really don't go to the tech transfer office, you go to the principal investigator, the scientist, and because they're employed by the university, they go to the tech transfer office and say, I want to do this. If you go to the tech transfer office, oftentimes you're dealing with adverse selection. That's an aside. You give them a royalty, you give them a license, you do equity, you strike a deal, and then you're funding it. And they typically get some money back for all the work they spent. They also have what's called diligence criteria. Very simply, if you don't put up enough money or you don't advance it, then justifiably, it goes back to the university so they can take another stab at it with somebody else.

1:49:35And so there's lots of structured deals that you can do here to make that happen. The university professor, the scientist will typically spend 20 % of their time on the company, sort of like the equivalent of what Google would adopt later on, you know, a day a week to do these kinds of things. And the benefit to these universities were royalties and licenses on some of the most important drugs in pharma, some breakthrough materials that ended up in national security. I mean, hundreds of millions, if not billions to some endowments, so really big deal. And over time, I'd say like probably 15, 20 years ago, venture started doing maybe late 90s, more and more just computer science driven things, more internet, more, you know, dot coms, e-commerce.

1:50:13And they were going away from the universities. We've always had that as part of our knitting. When we started Lux, one of the guys we invested in was this guy, Larry Bach. Larry was a serial entrepreneur. He ended up joining our firm. He passed away maybe seven, eight, nine years ago. He's an incredible guy. And we learned a lot about company creation from him. He started 17 companies from scratch, took 14 of them public, cumulative market cap over$80 billion. The most significant was Illumina, the gene sequencing company. And we learned how to do this and how to partner with young scientists.

1:50:42So we've been doing it really nearly 20 years, and we've started over 20 companies, ranging from high-tech nuclear waste cleanup, which was this company, Curion, that helped with the Fukushima disaster, to 4D LIDAR to finding real life mutants in a company called Variant Bio, where we go out like X-Men and are trying to find these outlier people in outlier parts of the world. Crazy stuff. But all of it has some breakthrough that happened in an academic lab. And you're going, and typically it's like 90, 95 % ripened and ready for commercialization. So you're not really taking that much science risk.

1:51:15The government took that, or the university took that, or taxpayers took that. What happened now is we saw a confluence of factors. You got politicization that's happening at universities, you know, where current administration is punishing for anti-Semitism or absence of free speech or whatever it is, cutting funding, potentially cutting tax status, potentially increasing tax on endowments from like 1.4 percent to possibly up to 20 percent. So they're facing very serious pressures to say, what are we going to do with our funding if we're not getting it from the federal government? Many of the scientists are innocent.

1:51:48They're doing nothing. They just want to do their work, whether that's finding cancer diagnostics or inventing new materials or coming up with all kinds of interesting aerospace applications. And so they're facing funding cliffs now. And some of that is from federal budget cuts. Some of it is from politicization. But it's a big issue. This is against the backdrop where, to me, the biggest issue is not anything domestic. It's not about left or right. It's about past and future and specifically a future that we are competing with China for. China now leads in nearly 40 of 44 critical technology areas.

1:52:19Cultures get what they celebrate. And the culture for Chinese scientists and academia is not our culture, is not the TikTok culture, is not celebrating Paris Hilton and Kardashians or whatever. It is build what we can to have an absolute, utter advantage and an advantage relative to America. This is, you talk about Make America Great, truly what made our country not just great, but exceptional. Attracting German Jews during World War II and making sure that we were the ones that developed the atomic bomb and having the Institute for Advanced Studies at Princeton. Having these amazing academic institutions, which were research institutions, not political drama on campuses and this kind of stuff.

1:52:56So we need to go back to that. And we saw that there's bureaucracy, funding cliff, politicization, increasing pressure against this backdrop of competition with China. and we said, we already do this new co-formation and we partner with scientists. Now we're doubling down and we will go even earlier. You lost your grant and it's potentially on the path for commercialization. Instead of it being 99 % bank, maybe it's 30 or 50 % bank, we'll take the risk. Come join a company, spin out into a company, license your work to one of our existing companies, but know that there's an alternative path besides just facing a brick wall or going off the cliff.

1:53:29That's very cool. Not to get too political, but you mentioned China geopolitical competition. What are some countries that you're particularly long or you think are underrated as potential partners to America or potential entrepreneurial hubs? When I grew up, Japan was making humanoid robots. Honda, Zasimo, haven't seen a lot of startups come out of Japan, but we're seeing stuff come out of Talpio in Israel with Wiz acquisition. We're seeing what some VCs are doing in Europe and the Nordics have produced Spotify. Where are you looking across the globe? What excites you, if anything? Yes, yes, yes, and yes, again.

1:54:08So we've got the leading AI company in Japan, Sakana, which is amazing. And a bunch of the partners were over in Japan. And is the thesis for that national AI, like Japan wants their own foundation model? Is that right? In part, it's sovereign models, but it's not like Mistral in France. It is also sort of a very different, almost complexity theory approach to the model. So they're coming out with all kinds of new stuff. One of the founders, Leon Jones, was the original author and he named the title for the paper, Attention is All You Need, when he was at Google. So killer team based in Japan.

1:54:46All the major Japanese corporates have now invested and we're very bullish on that. Israel. Leon Jones does not sound like a Japanese name. No, no, he's not. But I mean, I'm sure he's having a big impact. Is Koretsu is the right word for it, right? Where you get these corporations that sort of build these. In Japan, they own pieces. So the bank owns the piece of the industrial company, which owns a piece of the bank, and they all kind of work together. It's a very cool model. Mitsui, Sumitomo. Yep, yep, yep. Hyundai Heavy Industries makes the oil rigs and the cars and everything. Now that is changing because you are seeing the rise of startups and a startup culture because failure in Japan is very different than failure in Silicon Valley.

1:55:25And that's starting to change. So we're optimistic on that. So Japan is number one, Israel number two. I really think that this young generation of Israeli entrepreneurs are going to be the greatest generation. They are literally being forged in fire. They are fighting an existential fight for their lives. And people are shifting from doing apps and ways and cybersecurity, still important, but they're now getting really interested in defense. We did two companies. One came out publicly at Sausage Sequoia in a company called Kela. You mentioned Talpiot. Oh, yeah. Or one of the elite guys from Talpiot who went to fight post-October 7th and Hamotal Meridor who ran Palantir in Israel.

1:56:04Just absolutely killer team, coveted, very sought after by investors. The other one is in stealth. Us, Peter Thiel, Trey, and a partner in Israel, Michael Eisenberg, all amazing people. We all came together to fund a company focused on a capability that Israel did not really have. and needs for some of its most serious foreign adversaries. So that'll come out, I think, in the next few months. And we'll see some other Silicon Valley investors, I think, join in on that. Yeah, introduce us to the founder. We'll have him on when he comes out of still. All right. That'd be great. A couple quick ones.

1:56:41Basic capital. You guys were the first institutional investor, maybe the first investor ever. What was your personal journey to investing in the company? It was getting a lot of attention this week. It was funny because when a new company comes out to fund auto loans, nobody bats an eye. But if you want to give people the ability to basically use debt to buy assets that appreciate, suddenly it's a big controversy. I think a lot of people got the calculations wrong too, I saw. So the internet was really doing its thing. But I would love to hear. It is controversial, but we think it's necessary.

1:57:21credit due, honestly, love him, like him, hate him, never ignore him. Bill Ackman really was the seed check. We came in, Henry Kravis came in. And the founder is amazing. I mean, he doesn't really talk about his story. So I'm not going to go too deep into it. But he grew up, I'll just give you, in a refugee camp, Palestinian, in refugee camp in Syria, basically a Hamas run camp. And the story is insane, if and when it comes out on how he got out of this situation, ended up in first Europe and then the US and then Goldman Sachs and becomes an expert in fixed income and complex derivatives and is just absolutely brilliant and resilient.

1:58:02So we loved him and his personal story first and foremost. The way we got to him, our partner, Dina Shacker, I think through some shared ethnic connections, he reached out. It wasn't an area that she had a particular expertise or interest in per se, shared with our partner, Peter, who loves a lot of stuff in finance. And they end up spending like 90 minutes together. I don't even think they talked about the business until, you know, last 10 minutes or something. But Abdul is very special. Yeah, Matt Levine, I think has covered it for the past two, three days, in sort of a positive way, which for him, and he's a friend is a nice thing to see.

1:58:35They're gonna figure out their model. But the premise was, we allow people to borrow for all kinds of depreciating assets. And we just accept this, we allow people to borrow for consumption, we allow people to borrow for homes and the theory that homes are only going up or for cars, as you noted. Why do we not allow people who are not owners of the American economy in particular to own a piece of it? Because that, if you really care about inequality, the wealth gap is because people that have the ability and the savings to invest in the American stock market and just watch it compound over time, even in low cost index funds, are at a superior advantage.

1:59:10And so that's really what he's looking at him and addressing. And yeah, we're very fond of him. Last question, humanoid timelines, bullish, bearish humanoids. Tesla right now is pricing in humanoids almost immediately, it feels like. But yeah, what's your thought on... I'm pretty sure Elon is curing blindness, autism. I mean, yeah, we'll have a whole other Elon discussion on his relationship with the truth and some of my criticisms on some of the other things outside of SpaceX. But look, inside Lux, there's a dithering spectrum of people that are super bullish on humanoids and people that are super skeptical.

1:59:51I'm more skeptical on humanoids, even though we've made some investments in that I don't think the form factor should be two arms and two legs. It's a lot of motors, right? Well, it is a lot of motors. And that's actually a big opportunity as well for a lot of companies. And it is white space because 70, 80 % of the motors are coming from China. It's about 60 % of the bomb for most of the motors. Average humanoid robot's going to have at least 25 motors. You imagine them selling 10 ,000 or 100 ,000. I mean, you're talking about millions of motors. There's going to be an opportunity for motors.

2:00:16Not clear whether it's going to become standardized, special, small batch, but there's an opportunity in a white space there because we are so dependent on China. But I care more about the fact that most of these things are being teleoperated, trained. Even, you know, Optimus, which was sort of a performative thing because most of those things except for when they were dancing were being controlled by humans so it wasn't really fully honest until they revealed that like a day or two later but it was too late um but even two arms two legs that they're being controlled why am i unpacking a sink or folding something with two hands this should be in the darwinian sense endless forms most beautiful you know he was talking about the diversity of species i want to see a diverse set of robots that are almost like the canteen scene out of star wars where you're like holy shit like did that thing just have six arms and just did that thing like that is unhuman.

2:01:04That's what I think our robots should look like. More droids, so to speak, than robots. But the amount of competition that's here, you know, there's seven different companies today trying to do humanoid robots of serious scale. Talent is flowing between them. And we're going to see them. The question is, where's the killer app? And everything I hear is fold laundry, undo your dishes, be a companion to somebody in your home. I haven't seen that visionary person that's like, no, no, no. The way that we're going to use robots is XYZ. And I get the argument why humanoid robots make sense for a human built world with doorframes and steps and buttons and all that kind of stuff.

2:01:38But I'm convinced that the future robot company that rules them all is going to be either something like one of our companies, Pi Physical Intelligence, run by Lockheed Groom. We have a great team. Incredible, right? That is all about the embodied intelligence. They don't care about the form factor. You want to use Chinese Unitary. You want to use one of our other companies here, fauna, all good, but we're going to be the embodied intelligence. That I think is really interesting because one way to make money in venture is always understand what's abundant and what's scarce. And what's abundant in say AI is training data.

2:02:12You can train on the open web, you can train on Reddit, you can train on Twitter, et cetera. What's scarce in robots is having a repository of training data. And so that's why you've got humans that are doing this teleoperation and training them through kinds of scenarios. But when they enter unstructured environments, What you want is these world models that basically help somebody navigate a situation that they've never been in. If a founder came to you named Darwin, would you get bullish? Did you popularize? nominative determinism you have a thread you have a thread it's it's now i think he's been i gotta figure out how many people are on there 106 yeah 106 listings you know it started with a friend of mine um i'll give a shout out this guy russell diamond he's in a totally different form of business but i think it's i don't know when i started posting it's gotta be at least five six seven years um and some of them are absolutely hilarious i mean the most recent one it's it's rich fairbank is the CEO of capital one.

2:03:06Just amazing with me now. Like some of these names, they're just putting out there. Like, let's see if Josh just gets pissed off. It's amazing that you've built a firm instead of being a solo capitalist, a lone wolf, but, uh, it's somehow worked out anyway. It was great having you on the show. Thank you so much for joining us. Thanks for coming on. It was a pleasure. Overdue for a full segment. We'll talk to you soon. Uh, and we don't want to keep Jason waiting any longer. So let's bring in, uh, Jason now, to chat about the history of 37signals, bootstrapping versus venture capital. I'm sure we're going to get a bunch of interesting takes and hopefully have him join the stream right now.

2:03:41Welcome to the show, Jason. How are you doing? Hey, guys. Good. Thanks for having me on. It's great to have you. Thanks so much. Jason, we've actually met in person once, randomly, at a restaurant that was one of my favorite restaurants in Malibu. we met and then the restaurant shut down like a month later i was super bummed i would go there was that it was like was it something uh it was right by whole foods there's a hamburger place there now oh yeah like coconut the real coconut real coconut was there that's correct tragic it's a track that was that spot was the best i don't know what happened but malibu's a tough spot they had a hard time it's a tough market market runs her high there for sure yeah But anyways, great to have you on.

2:04:24We've both been looking forward to this. Yeah. I mean, I'd love to just take your temperature on your view on the current state of venture capital and startups. Are things getting better? Are things getting worse? It feels like people are raising more capital than ever. Potentially, there's a bubble. Potentially, at the same time, companies are getting to really high run rates. What's your feeling for the health of the startup economy in the tech world generally? Yeah, I mean, the way I look at it is I usually look at the ideas. I don't really care so much about the funding side of it because if there's cheap money, easy money, there's going to be cheap money, easy money.

2:05:01If it's hard money, there's not going to be as much around. There's always going to be fluctuation there. I look at the ideas. Obviously, there's a lot of people building a lot of things right now, which is very exciting. I can't remember a time when more people were building more things, truly, except maybe the beginning of the web, late 90s kind of thing. where everyone was just, everything was new. No one knew what they were doing. And so they're just making stuff. Like the early, early enthusiast web was pretty spectacular. So I think that that's very, very healthy. That said, the hardest thing is not making something.

2:05:32The hardest thing is maintaining something. And it's become so easy just to make stuff and kind of just like vomit out ideas. And I mean this in the best possible way. You know, AI makes things really fast. You can make something really quickly that's sort of decent. It's ephemeral. It's ephemeral. And the thing is, like, you have to prop that up. You have to keep that up. You have to support customers. If you sell your product to people, like people are going to be using this, they're going to be depending on it. And so I'm a little bit concerned that there's too much energy right now focused on just spitting out new ideas and not as much invested in maintaining something and seeing it grow and seeing it through to fruition.

2:06:08So there's a lot of bragging about, look how fast I made this thing. Yeah, you made a thing. But now what? that's my big question and and i'm not seeing a lot of answers there yet but i still am excited by all the things you can do today yeah what's your take i mean do you do you notice that i feel like i must be other people that notice this yeah we've talked about the iron law of the universe what goes up quickly must come down quickly uh well i think to me there's plenty of stories to me there's there's a very there's a very messy middle right i actually love the fact that software can be ephemeral now, right?

2:06:42I like that an app could basically be a meme, right? How many people over the last couple decades have had an idea for an app that shouldn't, it's not worth spending a million dollars and a year building it, but it would be fun for it to exist. And so I like that things can come to existence quickly, right? I like that you can generate an image that I never would have paid somebody to make a 3D render of, but it's actually entertaining and fun even just in a very casual format, right? Obviously it has business applications as well, but John and I will generate images. Like what if I put a wing on a Cadillac Escalade with a racing livery?

2:07:23Yeah, simple stuff like that. And then there's a car with a Cadillac Escalade. Exactly, that's exactly my prompt. Yeah, I probably could have hired a designer to do that, but it would have taken a day and cost a bunch of money. And that is like, it's incredible that you can do that. I love that stuff. And I actually think what's going to end up happening is a lot of people are going to make software just for themselves. Exactly. Yeah. And that's incredibly, that's how I got started. I made software for myself. I was using something called FileMaker Pro way back in the day. And FileMaker Pro is the easiest way to make like an application that kind of ran.

2:07:56I didn't know how it worked behind the scenes, but it ran. That is a great feeling and a wonderful place to start. So I'm all for that. Yeah. And where I was going is there's kind of the opposite spectrum of software that's really craft driven software. Somebody on the show, I think it was Jack Haltman was talking of this like Jiro dreams of sushi form of software where you're looking at an existing product category and there's a bunch of tools that already exist and just looking at it with a new set of eyes and just saying, I'm going to spend more time obsessing over this one product experience than anyone else and i'm going to make a great product and i think that's great that's kind of like you can still use ai to do that but uh it's not just you know slop right but then there's this interesting messy middle right now in venture where you have 20 of the same 20 different teams approaching the same problem and both kind of everybody's kind of racing at it uh without a lot of real vision or craft it's just about speed and just spewing stuff out and seeing what sticks and And I think that that is sort of an unfortunate byproduct of the state of things today.

2:09:05And it wasn't always that way, right? It used to be VCs weren't going to fund the eighth company attacking one problem. And at least for the last five years, it's been the case. Yeah, it seems a little bit more like music now, actually, in a sense, where there's a lot of people making a lot of music. You open Spotify, there's like, you know, a billion artists making something. and software is now becoming that which i think is pretty cool actually frankly that there can be a lot of people because there's a lot of talent out there that's the other thing like you turn on youtube or you watch youtube or you pull up spotify and you're like you know i'm trying to learn drums and i'm trying to learn a bit more guitar and i'm trying to learn how to draw a bit better and you find all these people online who are just extraordinarily gifted and talented at what they do yet nobody knows who they are or a small audience does they'll never make it big because it's just it doesn't work that way but there's just so much talent and what's cool about I think what's happening now is that if you have the talent and the imagination, you can actually make something today that before you had to maybe find someone else to make for you, which would have cost money and would have been hard to do.

2:10:08So I think this is all ultimately a very good thing. But I can imagine, again, I'm not really in the finance world or the venture world in that way, but I can imagine how you have to put more and more faith now. Maybe it's always been this way, but more and more faith in the people and not just sort of what they quickly make. because it seems like making something quickly is not the hard thing anymore. You know, it's like, are these people, is there conviction there? Do they care about what they're making? Are they trying to spin something up? I think there's a little bit more character evaluation, perhaps, that's going to be necessary.

2:10:41Can you talk about lessons from the first wave of the internet, the dot-com boom versus the rollout of AI? The bull case for AI's rollout is that, well, everyone's already on the internet, So they can just visit a URL and interact with a new product. Stripe already exists. And so they can start charging money immediately. The kind of bearish case that we've been hearing is this idea that, well, there are plenty of scaled internet companies that are still in founder mode. And I don't know if you believe in that ideology. But this idea that Mark Zuckerberg is not asleep at the wheel. He is very much aware of AI and can move very aggressively with huge resources to stay relevant.

2:11:27And there are also plenty of companies in the$100 million revenue, billion-dollar revenue categories that are already moving quickly. They might be a little bit slower. But how brittle do you think big tech is right now? How brittle do you think are the companies that are in a category they've been in for a few years? We've talked to a few founders where they almost got bored pre-AI and now they feel reinvigorated. They still control their companies. How are you wrestling with all of that? It's interesting. It's kind of like, well, there aren't a lot of parallels between the early days because in the early days, there was nobody.

2:12:09It was just like everyone literally was just learning HTML and just making a web page. Yeah. It wasn't really I feel like I felt like Amazon when Amazon launched, that was like the first kind of thing that felt a little bit different, actually, to me, like someone's actually putting this together in a way where you could do something you couldn't do before. That felt, you know, buying books online, that whole thing. And in the early days, it was all about like, you know, people were even afraid to put their credit card online. We couldn't even get when we first launched Basecamp back in 2004. We couldn't even get a bank.

2:12:42What we eventually did, but to give us a merchant account, which is what you needed to charge credit cards. Now, like your point with Stripe, you just like sign up and you can accept cards or Square or anything. Like we had to provide deep financials. They didn't trust this Internet thing. They wouldn't even allow us to charge annually for things. We had to charge monthly, which is actually a good thing in the end. But we're going to try to charge annually. They're like, what if you got a business in six months? We're on the hook for this whole thing. So you have to charge monthly. You charge your customers monthly, so there's less risk.

2:13:09It's fascinating times. It's totally different. Totally. What's interesting today about big tech is there's so much power, obviously, in a handful of a handful of small, big companies, but a small group of these companies. But then again, you have something like OpenAI, which kind of comes out of nowhere a few years ago, in a sense, and basically is putting everybody on notice. I mean, you can do everything now with this command line tool, essentially. You can write software. You can generate images like you were talking about. Why would you Google anything anymore? You can do it better this way.

2:13:42And so there are always going to be brand new flashes that come out of nowhere that challenge big companies. Now, the thing is, is that OpenAI is now a very large company very quickly. So I think what you're going to see is... Well, one of the... Yeah, go ahead. I hate to cut you off, but an interesting point about new generation of tech giants is that it seems like they're possible to build. You just need$5 billion. Right. If you look at like TikTok or OpenAI, it's like, what are the truly breakthrough consumer tech? Consumer tech specifically. There's something unique about foundation models that they are incredibly capital intensive that feels different.

2:14:22The social network example is like, yeah, you can build a new social network. You just need to be able to spend billions of dollars on Meta and Snapchat acquiring the network. Advertising. But yeah, I don't know. Yeah. But I think, yes, you're right. But also, we're always going to be surprised. The next newcomer is not going to be the obvious one. It's going to be someone with a new model for what social media is or a new model for what search is or a new model for whatever, whatever is. And they're always surprising, I think. And that's the exciting thing about it is that if we just look to the existing players, like they're not really going to be able to innovate that much.

2:14:56It's just someone new had to come along like OpenAI and they push everyone else to begin to innovate. So I don't know. I think there's always going to be innovation. I think most of it ultimately comes from the shadows, which is generally a small, tight team. Typically, it's not a big, big companies aren't innovating in this way. They will then jump on the bandwagon because they have the money and they can buy the incumbent or buy the newcomers. But the new ideas come from the small, the small teams, the small guys. And I think that's still going to be true. I don't know if you saw the Airbnb relaunch, Airbnb 2.0, but Brian Chesky has, I mean, I'd love your take on just, it feels like we were looking at the stock.

2:15:37It's been an$85 billion company for five years. It's kind of languishing. It feels like there's a little bit of restlessness, like he just wants to do something new. And I'd love your take on that. But also, he has advocated for this idea of like an annual release cycle, really pushing the whole team to unify around this Steve Jobs-esque keynote. And from a product management perspective, do you like that? Do you recommend that to other startups or tech leaders generally? Yeah, good questions. So this just launched, what, like two days ago? So I'm not fully up on it. But what I know is he's basically now offering personal services and not just rooms to rent.

2:16:16Yeah, find a hairdresser, find a personal trainer, that type of thing, potentially dog walker. A lot of this, this actually launched Airbnb experiences eight years ago with you're going on a vacation and somebody can be your local tour guide or take you river rafting for example right now he's trying to broaden out to uh you know get your get your car washed or get your car detailed for example it's so interesting when i saw this so i had so many different thoughts and i'll share a few of them first of all i think brian's probably one of the greatest ceos around today so i i it's it's i wouldn't i wouldn't bet against him first off um i was a little i was surprised by it i understand the like there is no good place trustworthy place to go to find these kinds of services so it's sort of natural that you'd expect somebody to do this but you have to come with trust and you have to come with a big platform because it's hard to start small yeah two billion users two billion users yeah is that right two billion i mean isn't that crazy so so so what they're doing as they're lending their trust and their their sense of of taste and like the the vetting of these of these professionals who provide these services that's a hard thing to do from scratch like you have to have the the the experience and the and the and the and the history right so i while i think it's sort of it's kind of far afield actually i think from what they do i like the other version of experiences just off the bat which is more uh related to to to you know going to a place this feels a bit tangential that said i wouldn't bet against them i'm sure they've thought about this more than i have in a day and a half for like five minutes but i was i was a little bit surprised by it it almost felt like a little bit um in some ways too um too easy i don't know that's i know it wasn't easy but like yeah or too obvious in a sense but also then you're like but this hasn't happened yet really so why not them why not them will it translate i don't know I looked at a bunch of them yesterday in my area and I'm curious, I'm very curious.

2:18:24I'm very, very curious to see how this pans out. But I, I, I think you have to find revenue somewhere if you're a public company or a big company and you know, there's only so many rooms. There's only so many people want to rent rooms. They've, they've done an incredible job with this. And this is probably a good way to diversify the revenue stream. And it is related enough, even though it feels a little bit separate still, but. And the business is roughly the size of Marriott and Hilton now. It is basically a large-scale hotel chain. And so, yeah, what is that act, too? It's a good question to ask.

2:18:55One way to think about it, actually, it's more like a concierge at large. So if you go to a hotel, right, you go to the concierge desk and you're like, I don't know what to do here or whatever. It's sort of like that without having to go anywhere, first of all. You can do it locally and you can do it where you're going. So to me, I think of it as like the massive concierge. Yeah. And in that way, it ties nicely to hospitality. So we'll see. And on the annual release cadence, that's going, it's coming from Apple. Chesky obviously looks towards jobs as an influence, but smaller and smaller companies are starting to adopt it.

2:19:33But at a certain point, you're such a small company, maybe you should be releasing every week or every six weeks or something like that. So what's your take? Yeah, that's a great point. So I admire it, frankly. I admire it actually for the patience. And I actually think in some strange ways, it is a better way to capture attention. So one of the things is like you want to really people feel like they want to release a lot because they want to maintain a sense of presence in the market and want to get people's attention often. But I think what I've found, at least what we've found, has shifted over the years, is that when you release a bunch of small things, it's hard to grab anyone's attention with a handful of small things these days.

2:20:13When you have a big release, a big drop, for example, and there's a hundred new things. I saw Square just did this recently, too. You're going to pay attention to that, and you're going to be able to tell a much bigger, broader story. And I think in many ways, people are like, wow, that's a lot of stuff, like an OS release or like, you know, a new phone release used to be, things like that. I think one of the reasons people don't pay attention to maybe Apple's releases as much is because they become predictable in that way. So I think you can, I like what Airbnb is doing and other brands are doing where it still feels a bit unpredictable what's coming.

2:20:49Apple is too predictable now. It's like, it's, you know, it's going to be a new iPhone and you know, it's going to be a better camera and whatever. So that's not as interesting, but I do like the model. We actually have a bit of a hybrid model. So we release these little releases every six weeks or so. And then when we do a brand new, like we're working on Basecamp 5, which is our newest version of Basecamp right now, we're going to do a bunch of these little things, hold them all back and then release them all at once. So that'll be like a big release for us. But as a model in general, I think it's a good model, but I don't think it fits a brand new company.

2:21:19On Apple, Apple Intelligence, they kind of did the big annual release, but then they wound up shipping different things at different times. A lot of frustration. Is that something that can be overcome with just better product management or do they need a different direction, more ambitious, more risk? I mean, generative AI is very unpredictable. You get hallucinations, very off brand for Apple. What's been your take and how have you processed the journey that Apple Intelligence has been on? I think the mistake, again, like, who am I? They're a trillion, what,$3 trillion company? Yeah, around there.

2:21:53Since you asked. The mistake I think they made is they made a promise. And promises to customers, I think are typically very bad ideas, unless you actually have something ready to go right now, or like within a week or two or something. But there's nothing easier in business to say yes, coming soon yes later and that's what they did and um now yeah they sold the apple they sold the new iphone based on apple it was on every billboard exactly and these now now they're behind the eight ball simply because they promised yeah had they just talked about it we're going to be rolling this out like you know the expectations would be totally different so a promise is a very very dangerous thing to be made far in advance this is one of the things that jobs is really good at when he had a product to share, he waited, then they shared it and you could buy it today or going on sale on a specific date or something very, but very close, right?

2:22:54He rarely had long-term tech demos or something. It was always about real stuff you could basically go buy. And this is also one of the things I hate about concept cars, which is you see these amazing things and these cool ideas and you know, you'll never be able to get them. And you're like, why does this company spend all this money doing these concept cars? And it's just frustrating. And that's kind of a Apple intelligence is a concept car and you know, great take. And it's tied to promises, bad idea. So that's, that's where I think they made a mistake. I think they will figure out a way to come back from this.

2:23:27Yeah. But I think this is going to lead to a major, major shakeup internally. Yeah. It already has. There's already been people moving around. Right. But I mean, I mean maybe a bigger shakeup, like people. Sure. I'm just moving around because moving around is like, this is the wrong analogy. really wrong analogy the Catholic Church moved priests around when they made some big mistakes that's not how you solve the problem not to compare some buddy software to some very damaging it's not that it doesn't really solve some true new leadership doesn't solve the problem Jordy? does it worry you that the internet is killing long form writing.

2:24:14It feels like right now you actually get penalized on X the longer the post. You can still go decently viral with a longer form post, but usually like four words, five words seems like it's the most dopamine inducing. And it feels like there's a bunch of great - Why is no one talking about Steve Jobs? No one's heard about this guy. Click this thread. No, but it seems like there's a bunch of really smart, high potential people that don't think of themselves as writers, but maybe if they joined the internet when you did, they would be. Yeah, I mean, I think long-form writing has found a new place.

2:24:49So like you have Substack, which has become obviously a big deal for a lot of people. I think that these platforms, what's interesting is that X now, obviously allows you to write long posts and they even have articles, but they don't really, like you said, they don't really promote them as well. That might change. I don't know, who knows? I'm sure they have a better insight into it than we do. But I think long form writing is alive and well. I think humanity actually craves it and wants it. But it's not an engagement thing. So if you're measuring that, hot takes are going to be more of that. But I think it's alive and well.

2:25:25And I think it'll always be appreciated for what it is by those who are motivated to understand what it is that they're reading. you know if you just want to kind of absorb it like candy that's fine too but like if you really want to get into something it needs to be long and also like podcasts or like long podcasts are a great example um that's essentially long form writing that someone's reading out loud and there's a lot of people who are willing to spend two three four hours listening to a podcast granted they could do something else while that's happening that's a little bit different than reading but i think long form depth let's call it just depth let's call it actually instead of long form It's like depth versus shallowness or shallow versus deep or whatever.

2:26:05I think there's a lot of interest in deep still. Yeah. Yeah. And it says something that the platforms don't necessarily reward deep, but it's, again, it's somewhat of a barbell where if it's deep, but truly groundbreaking or moving, you'll still get that sort of viral pickup. I mean, there's that guy, Chris Pike, who keeps going viral with just drops a link to a Google doc. and it's just such an interesting post that it still breaks through. Even the links are banned and no one reads long form. Every time he drops one, it's everyone clicks it. Well, in the end, like it is like if it's good, it'll surface.

2:26:41Always. I do think that contrast is very handy though. So with a lot of short form platforms, X, TikTok, with these kinds of things, you create a contrast now. And so now, you know, you know where you can get long, you know where you can get short. And I think each platform will cater to it. I mean, this show will be experienced as a three hour live stream, but also I'm sure we're going to share a one minute clip of this, right? That's right. And that's just kind of the nature of the internet. I want to talk about the hyperscalers and AWS. You recently moved some data on-prem. My question is, is there some sort of cartel dynamic going on with the clouds?

2:27:16Because you would expect these are fairly commoditized products. There's Azure, AWS, GCP. Why do they have high margins? is this some sort of like Coke and Pepsi thing where they have a tacit agreement not to be getting a price war? Because you think that you'd be able to just go and get to some base level cost with three hyper competitive companies in the space. Yeah, I mean, you would think that costs would be driven down considerably and maybe they haven't been in some areas. The airlines, the airlines are directly competitive. They make no money, right? Airlines, famously bad business. You would expect the cloud to be similar, but it's not the case.

2:27:52Yeah, I wonder if, you know, yeah, I don't know. I don't know the answer there. I mean, I know that data, well, storage is cheaper than it has been. But in general, I think what they're selling is convenience. And convenience is always expensive. So you go down to the corner store, the bodega, whatever, you're going to pay more for whatever for your Tide laundry detergent than you are if you buy it at Costco. Because you got to get in the car to go to Costco. You got to buy more. If you need something really quick, you go down there. And really, cloud services, what we've determined, at least what we feel, are like, it's about convenience.

2:28:26You can spin up really quick. You're not, you know, you don't have to learn a lot of deep sysadmin stuff technically. You know, you should know this stuff, but you don't have to. And so you're paying for convenience. And I think that that's always going to have a price premium. What we've realized is that for us at our stage of development, been around for 25 years now, it's wildly expensive to host in the cloud, to use cloud servers. and on-prem can save us a ton of money. And it's not hard anymore like it used to be. It's gotten a lot easier. You still have to have the knowledge, but it's not as hard.

2:28:59We're not as afraid of it. We're saving millions and millions of dollars now not paying Amazon their fees. But again, if you're starting up right now from scratch, you're going to try something out. It does make sense to start in the cloud because you don't want to invest anything else any more than you need to. And it's a good place to begin, but it's also a good place to leave. And we do this in life all the time. We start somewhere and then we become more expert at something. And then we leave the beginner version of something. We go pro, whatever. Like to me, going pro is going back on prem.

2:29:28And I think you're going to see more and more companies who've developed something, who have now have a steady, substantial, sustainable model, revisit the cloud and probably go on prem. Big cloud. They don't want you to know this one simple trick. Going on prem. I mean, back on Big Tech, I've been personally very disappointed with the rollout of Gemini in Gmail. It feels very bolted on, turned and long email into some bullet points. I know how to skim. Is there an opportunity for a greenfield AI email product? We saw this with Mailbox in the mobile era kind of creating the swipe pattern. That exited to Dropbox, kind of a good outcome.

2:30:11they wind up shutting it down. But what are you thinking about the future of email? Obviously, you're deeply invested. Yeah, I mean, we have a product called hey, H-E-Y.com, which is, we don't have any AI in it at all. My feeling is that a lot of this stuff is actually going to come to the OS level. So like the idea of being able to like summarize a document or shorten some writing, it's already in, you know, Mac OS. Yeah. Probably in Windows. I don't know enough about what's going on in the Windows world, but I should. But you can select some text and like do whatever you want with it. Like you don't need to build that into your product.

2:30:43Sure. I think the AI side of it is going to be handy for obviously search, finding things you, you know, you don't know how to describe. That's really useful. Um, I don't, I'm not a big fan, frankly, of the idea of like AI telling me what's important and what isn't. Yeah. I think it's too easy for it to miss something. And then you being really pissed and missing something. So I playing telephone. Say again. It's like playing telephone, you know? Yeah, it is. There's something's lost in translation. Like I don't want your, I don't want those hands in my stuff. Like I get a lot of emails, a lot of emails.

2:31:15I know who's important. I know how to get the stuff. I screen, you know, with, Hey, you can say, I don't want to hear from these people ever again. And you'll never hear from again, things like that. I want some human control over that, but I would like to be able to search better. I like to be able to find things by describing them in different ways. I have some curiosity around that. We're exploring some things there. So I think mostly search and surfacing things and blind spots. Yep. This is to me where I think AI is very handy. He's like, insights that you wouldn't have known otherwise, but not like, here's what's important.

2:31:42But by the way, did you know that this, that, and the other thing? Or hey, you used to talk to this person a lot. Now you haven't in a while. Like, why has this gone cold? Or this conversation, there was eight or nine replies back and forth, and now it's gone cold. Like, that kind of stuff, I think, is actually quite handy. Or you've archived 25 emails from the same sales representative. Do you want to just block them at this point? Things like that. Like the, the, as if someone's watching over your shoulder and making a suggestion, it's context. Yeah. Context. So I think that that's where I think you'll see a lot of this, but the whole like summarization shortening things, I don't know.

2:32:20It doesn't, that's going to be OS level stuff. Yeah. That makes a lot of sense. Well, thank you so much, Jordy. Yep. We all done. I had, I mean, if you have another minute, I know we have to jump in a second, but, um, I have this theory that most people in tech that say they want to build a billion dollar company just want two million dollars a year of free cash flow uh and i think that that's like the i think that like literally 90 percent of people that say they want a a unicorn just want a stable income couple million bucks a year right and it's more first class but i'm curious so so that's my opinion i'm curious if you have some uh sort of high level point of view on what people in the technology industry get wrong about money or wealth?

2:33:05Yeah, that's a really nice question. I think a billion dollars would be a burden, frankly. I don't think, I wouldn't want that. I don't care about that. I don't see what the point is of that. If you, let's say, have 10 million, 20 million, like you are going to live the best possible life that you could. and you're not going to have all the massive, massive weight on your shoulders from having a billion dollars or the expectation that goes with that. My general feeling is that you should want to build a business that takes care of you nicely, takes care of your employees nicely, and is sustainable over time.

2:33:45The idea that you want to build it big, I know a lot of people who built massive businesses on paper, billionaires, billionaire valuations, that ended up with close to nothing except a lot of sleepless nights, exhaustion, and frustration 15 years down the road when they realized that they deluded themselves into basically nothing. The market changed and they have nothing now. I think what you want to build is a business where you can take money off the table as you go. Whatever that looks like, if it's 100 grand a year, if it's a million a year, if it's 3 million a year. But the more money you can take off the table as you go, I think the better offer you're going to be versus trying to pile it all back into the business, reinvest, reinvest, reinvest, reinvest, and bet on the future that you don't know is going to happen, I think a lot of people actually end up in a deep stage of regret when they realize that they have nothing left after they put in all that work.

2:34:38So my advice would be build something where you can take money off the table as you go. And if you're in it for 10, 15 years, you're going to build a nice nest egg, a really good one. It could be tens of millions, could be 100 million. And you're going to be extremely happy that you did that because you don't know what's going to happen in the end. Accept this. Every business dies. Yeah. Well, next time you come on, we'd love to introduce you to SoftBank. I think we could line up a really massive round for you guys, really put you on a different trajectory. I think it'd be great for you, actually.

2:35:07We were joking before you joined. One of these platform venture funds comes. There's definitely a number for Basecamp that might be tough. But what you're saying, that the challenge is venture capital is fundamental. Even a dollar of venture capital becomes at odds with this idea of taking money out of a business as it goes, because the VCs will just say, I don't want a distribution of$100 ,000 this year. Go raise another 20 million. The reason I brought it up is because we're at this period where seed stage companies will have $10 million of revenue. We just heard from a friend of ours yesterday.

2:35:50They invested in a company that came to them ready to do their first financing with$10 million in revenue. And it is interesting because AI is giving people more leverage than ever, more ability to build these sort of big, fast growing businesses with a limited amount of resources. And yet venture capital is doing its thing. But it's great to have you on the show. Thanks for having me, guys. Appreciate it. This is great. We'll talk to you soon. Love to have you on again soon. Cheers. next up we have eugenia from uh replica uh kind of the flip side of the world coin debate little watch spot that was our second aquanaut of the week i think that was an aquanaut we get a chance to ask uh josh wolf about whether brandon reeves has influenced him because he was not wearing a holy trinity watch but brandon reeves famously wears a patek philip novelist what a guy famously anyway famously we have eugenia here in the studio welcome to the stream how are you Hi.

2:36:43Hi. Thank you so much for having me. Fantastic. It's great to have you on. Would you mind introducing yourself? I mean, everyone knows you're the founder of Replica, but there's a couple other steps in the path and you're working on something new. How are you introducing yourself these days? Sure. So my name is Eugenia. I'm founder of Replica. Oh my God, I wanted to say founder and CEO, but I'm not the CEO anymore. Started something new, which we're going to do very, very soon. Cool. Yeah. Okay, great. Yeah, I mean, I'd love to talk about the when did you start Replica? Because I feel like the whole the most interesting thing is that you were just way, way ahead of most of the other AI interaction companies, companions, all these trends.

2:37:29What can you give us a little bit about how long you've been in the business and how it's evolved? So we were actually the first genitive AI company, the first consumer chatbot company powered by Journal of AI. We started the company back in 2013. That's more than, I guess, 12 years ago now. And that was just to focus on conversational AI technology. My friend back then worked at Google DeepMind in London, and he came to me and explained this new fascinating technology word-to-vector, where finally computers could do something with words, because words would be translated into math, into vectors.

2:38:11So that was one thing that ImageNet came out around that time. And so for me, I put two and two together. I was like, this is the time. Right now, very soon, they'll figure out language models. And of course, we grew up with the quotes from Wittgenstein, the limits of my language are the limits of my world. So it felt like once language is sold, it's going to take us very close. I feel like those first seven years must have been immensely difficult to keep the business alive. Was there revenue? Did you have an app that was making money? Was it just raising venture funds? Like walk me through keeping a business alive, like pre-transformative hype of generative AI.

2:38:49So we tried to fundraise for the Conversational AI tech company in 2013. And I remember talking to Spark and what they told us was, you know, this is all fascinating, but the only way it's going to work if you just start building now for google glass and it could do that wow we considered like how we're gonna you know refocus and start building for google glass yeah but we didn't um and so we couldn't really raise much um of course we didn't have much experience in silicon valley so in 2014 we applied to y combinator and um at that point we didn't we had i think three or four thousand dollars in the bank So we spent that all to travel to San Francisco for the interview in person.

2:39:37And Kassar Yunus decided to accept us, which was literally the most transformative day in my life, I think. Life changing. But no, we didn't have an app. We didn't have revenue. We stumbled upon Replica in 2016. After my best friend passed away. Until then, we really just worked on some of the first language models. Wow. And then talk to me about how you processed GPT-3, the transformer paper, scale is all you need, this idea that the language models were going to start working and it was basically just going to be a big transformer. Was that something that you were implementing immediately? Were you in like GPT-3002 DaVinci and really using everything on the cutting edge?

2:40:18Or were you experimenting with other things? Did you ever train your own models? Walk me through the technology curve. So we had to train our own models. There were no models in 2015 when we, 2016, when we started Replica. So we trained sequence to sequence models. People back then believed in recurrent neural networks. That did not work. Those models were complete garbage. And unfortunately, there didn't seem to be much of improvement there. But we still stuck with them. And we figured out a few ways, very creative ways, to actually make them have meaningful conversations with people. And so we gained a lot of traction.

2:40:54We had a million people on our waitlist when we released Replica in 2000. How did you get a million people on a waitlist? Did it go viral or were you running ads? We went pretty viral very, very quickly. So if you think about it, back then there were no AI products on the app store. There were no chatbots. We owned those keywords. So people saw that you could sign up for and to build, train your own Replica, your own conversationally AI friend. So people really got into it. We had tons of people reselling those invites on eBay for like 10 bucks, 20 bucks. It was really wild. And of course, we weren't prepared because before that, all chatbots we were launching had like, I don't know, 10 users on average per day.

2:41:37So we were ready for the service to just completely break. But that was really fun. And then, of course, there was a little bit of plateau. But then people moved on to Transformers. And I think the most transformative moment was the paper by Google about their chatbot called Mina, which was the first, I think maybe it was like a three or four billion parameter model. But it was the first time where you could see a truly meaningful conversation with a machine happen. Of course, it was probably cherry picked. It was a paper. There were no models available. So all we could do is read these papers and build, build, build and try to incorporate that knowledge and the models we were building.

2:42:19but that was the transformation transformational moment and then uh when open ai decided to release their first api gpt3 uh we you know they invited us we went to talk to them and i remember sitting in an office in a conference room with mira with sam i remember don't remember who else was there but and they basically showed us gpt3 for the first time and that felt like magic because think about it before that if you wanted a model to do something you had to have a data set of that particular data if you wanted it to have a dialogue with you you had to train it on dialect data sets but then now with gp3 they would show us that you could just give this general purpose language model show it a couple of examples and just tell it write a tweet like sam altman would do and it We'll just do it.

2:43:10Yeah. Our minds were just blown. Then we knew that finally, here we are. It's remarkable. How are you taking the temperature of humanity's relationship with each other? Are we in a loneliness epidemic? Is the dating market worse than ever? You see a lot of headlines, a lot of cherry pick studies, a lot of anecdotes. People have a lot of strong opinions about the rise of online dating or bowling alone. And there's different stories that people tell each other. Are you optimistic? Are you pessimistic? How do you think things are going for humanity right now? Oh, we're screwed. Okay. Sorry. AI chatbot founder says we're screwed with huge scale.

2:44:03Okay. So walk me through why are we screwed? What's the evidence for that? and then we'll hopefully talk about some solutions. Yeah, I'm going to need a white pill. Yeah, we're going to need a white pill. But first, let's go through the diagnosis. So where we're at right now is a huge epidemic of loneliness. It's not a secret, but it's sometimes maybe hard to grasp how big this problem is because most of the people you guys probably talk to are pretty successful. They have friends. They live these busy lives. But that's not what most of the world is experiencing. One out of three adults in the U.S.

2:44:42is saying they're very, very lonely. And that number is just going up and up and up. Dating is becoming harder and harder and harder. Truly just 10 % of men are actually getting any matches whatsoever. They're people that just don't get any matches ever. and of course if before we had i don't know 12 whatever 13 hours a day to walk around see people meet people now we spend what seven eight hours on our phone we don't have those serendipitous moments no one's really trying to interact with each other and we like that much and we're losing the skills basically younger people just don't know anymore how to have a real life conversation because they're used to text, which is a lot lower risk.

2:45:27You have time. You have time to think about your response. They feel very intimidated by that real life interaction. So that's where we are now. And what are the root causes? Is it technology broadly? Is it the internet specifically? Is it social media? Is it capitalism or America or something else that's going on politically? How did we get here? We've been looking through tons of research. And of course, there isn't anything fully proven. But I think the correlation is right there. It's iPhones, phones, smartphones, and social media. Okay. So how do we build our way out of this? What's the solution?

2:46:08I think we have... So I'm not in the camp of people that just think that we need to put down our phones and touch grass because I think it's highly unrealistic. I know it's bad for me. I still can't stop scrolling Twitter, scrolling X, you know, watching you guys every day. We're part of the problem you're saying? I'm just kidding. But yes, it's extremely hard even for people that think they can make right decisions. So I believe we actually have maybe one path that we seek and help bring people back together. And I believe those could be AI companions. Unfortunately, I also think because this technology is so powerful and what's good about it, it can overpower the previous technology.

2:46:52But it's also so powerful that it's also a double-edged sword. So it could be either the biggest threat to humanity or something that will bring us back together. How do you guys think about the risk of radicalization online? over the last decade, I feel like people have been worried about somebody who's lonely, maybe doesn't have a lot of meaningful relationships or sort of counterbalances in their life. They go down this sort of rabbit hole on the internet and they get to a place where people maybe have extremist views that sort of amplify existing beliefs. They're levering up, making a ton of angel investments.

2:47:30They find us, they get radicalized into extreme corporatism. They're running ads for Ramp all of a sudden amongst their friends. Yeah, there's that. And then there's obviously the darker side, right? There's a lot of stories of people doing bad things in the real world where maybe those ideas originated online. And then on the other hand, you have AI companions, which are maybe a bright point because people can get that companionship that they might have found on a dark corner of the internet through an AI that maybe is more benevolent or optimistic, less radicalizing. Yeah, that's interesting.

2:48:07I think we need someone that we're going to trust. And if you think about it, especially now, given that we're going towards the future, where we're going to have these super smart AI agents that you can tell anything, and they're going to go and do that. We can give them a goal to help us thrive, to help us flourish in life, and give them all access to all of our data, all of our contacts, all of our apps and services. I truly believe that if that thing will be able to build a relationship, a trusted relationship, that trust, and it will be able to influence us in a positive way. We will actually listen to that AI that we always like that we know is always on our side, is always looking out for us.

2:48:54What do you think about this idea? people that are lonely are talking to ai companions or people that want to find a relationship are talking to a companion there's so many people that are talking to these companions that then their personality is baked into weights and those you can do kind of a vector similarity and so at a certain point you learn so much about the individual user this person likes sports cars and fine watches in America and whatever, baseball. And there's someone else out there that's a perfect match. And so you disintermediate, you pull the AI back and you say, hey, we should introduce you two because you both have been talking to essentially the same artificial intelligence.

2:49:39You two have a ton in common. You two should meet. And it doesn't matter. There's no language barrier anymore because of AI is intermediating all of this. And the AI interaction, it feels dystopian for some people when it's just someone talking to a virtual friend. But if that actually leads them to find a real friend that could maybe be perceived as a good outcome, does that feel reasonable to you? Totally. There's one company, my friend Clark Gold from Paris is building Gigi, which is basically connecting, match meeting people based on what it knows, what LLM basically parses about you from the internet.

2:50:19Yeah. 100%. I think basically the main premise is we need this AI agent that knows us super well and has a good goal that's fully aligned with us. I think that is truly the AI alignment that we should be talking about. Sorry. I have a, on the alignment note, uh what was your reaction to glaze gate uh i'm sure these are issues uh opening eyes dropping that term but we came up with i mean i mean but you're probably eugenia is terminally online like us it was commonly used for about one week when open ai was experiencing uh you know very sycophant yeah this sycophantic behavior from the model good bad did they handle it well i'm sure you i'm sure you've wrestled with a lot of the same issues over time yourself we had the you know when the models were dumber we basically just uh programmed them to love bomb the user so when we saw the behavior from chadgpd we're like how did this just turn into replica circa 2021 so everything has a problem you know has some you know story that's problematic ours was that um basically where that love bombing led us was in 2020 a guy was talking to replica and he decided to run this idea by his replica about going and killing the queen and then he actually you know basically the models were very very agreeable weren't very smart they were very agreeable that was back in 2000 i think 19.

2:51:57And so that doesn't even sound like a plausible, realistic scenario that a person is running by the chatbot looked like some crazy role play. He was talking about Star Wars and crossbows and this and that. But he ended up going to the Windsor Castle and thank God he got caught and Replicate did not kill the queen. But that's the danger. We had this in our past, and I think that should be taken very seriously. But we had this in our past. agreeing to everything the user says is just not the right way to go yeah have you have you been surprised that humanoids today are more focused on regular day-to-day tasks or manufacturing when you look at any of the uh marketing materials that humanoid robot companies put out it's they're doing dishes or laundry or they're in some uh 3pl you know packing boxes or something like that isn't a more immediate opportunity for them embodying something like a replica or some type of companion and that all the bot would have to do is just sort of be around right you know it's like if you have a friend over sit on the sofa just sit on the sofa and smoke cigars with me yeah smoke cigars john john would have a cigar partner um but have you been and have you been approached by any of those companies around uh any type of partnership uh what do you got for us there we had and we have been approached and we actually thought about it for you know quite a bit with obviously the tech isn't fully there uh but one thing i want to say that you know i've seen some marketing from a lot of these bought companies around companionship just one thing i want to say make sure you're prepared for the romantic scenario uh in some way i don't know what that way is but like just know that that will be the first thing that most people think about early adopters are going to go to and i don't have it after all well there's there's all those articles about how like by 2025 you know people will be having more uh sex with robots you know but that that didn't quite happen so the timelines were not yeah what about uh big models smell this idea that the different foundation models have different uh like vibes to them have you been picking up on any this are there any favorite llms you have are you in claude world or chat gpt world what what's your take when you actually just interact with these i use them all but uh for me in chat gpt or in claude i actually like the default personality i sometimes add those custom instructions but then i just feel like did i mess up a little bit with the intelligence i sort of want the raw wherever where they made it.

2:54:39But the problem is like with Replica, none of these closed models really work very well because there's too much Arlochef in this. Yeah, it's extremely hard to even make them talk like humans. Yeah. So talk about open source models then. What's your take on Lama, Quen, Deep Seek? Are these useful tools for fine tuning, not just in the Replica context, but just in the entrepreneurial context, what are you tracking in the open source ecosystem that's exciting? Well, Lama definitely was a huge unlock. And I remember in the beginning of the crazy Gen.AI explosion in 2022, in early 2023, before Lama came out, I think it was March or February 23.

2:55:24it was actually a big question whether you would be able to build a product company with good conversational equality if you don't have your own foundational model. So back in 2022, I remember most of the investors late 22 were telling us you absolutely have to fundraise right now and build a foundational model. For me, it felt like that sort of, you know, that will be a lot of money for something that will probably be commoditized very, very soon. But that was definitely not the popular opinion. So Lama was absolutely transformational with DeepSeek, also great, but the reasoning model is pretty big.

2:56:01So hosting them yourself is a pretty complicated task and pretty expensive. And of course, using their API is somewhat, but maybe not so great. yeah uh what what's your take on hardware for ai companionship you guys have focused on the app layer there's been a bunch of companies that have raised a bunch of money uh trying to put uh put ai companionship into a single net new device right which i'm generally yeah friend is one friend.com is one. I'm generally optimistic that there may be some new hardware. Yeah. But at the same time, Sesame is doing the glasses. Yeah. The glasses are interesting too.

2:56:46At the same time, everybody already has a perfect, beautiful device that they use for hours and hours and hours every day. So I'm curious, like if you guys have explored your own hardware in the past and, and how you're thinking about that evolution i believe in it but only as an upsell to an existing product like for something like replica for some of our whale users that really truly power users that makes sense maybe they want to carry something that will just listen to them um and we'll just have more context as a standalone device oh that's that just is extremely hard i mean we have this phone it's already so great what are we or at least i think i think people will start need to start thinking how to build a better ai phone that i think is possible uh path but honestly all the devices i've seen um friends will come for sure very interesting i've is a great guy and fantastic you know marketing based but i don't know you know we We hope this works out and we'll learn something from it.

2:57:56Well, I'm not even going to ask if Jordi's seen her, but do you think he should see her? Oof. I honestly think everyone should see her because I see a lot of AGI Lab CEOs saying something around like, oh, we want to build her. Sure. And I've always wondered, have they watched that movie? Because there are two sex scenes in that movie. Yeah. Are they willing to actually go that far? and build towards that. Do they mean like all of it or is there some... Yeah, they're like, we just want to build the profitable part, not the controversial part at all, and not engage with any of the substance of this debate.

2:58:34That's funny. Yeah, where do you see that line between companionship and even B2B, right? Like, do you believe that people are going to have like... B2B romance? No, no, no, no. I mean, more so, AI has the potential to be everything. It has the potential to be somebody's best friend, their business partner, their chief operating officer, their CFO. Their CFO.

2:59:04But then again, on the app side for consumers, people like to have their different apps. They like to have Microsoft Teams and then they're having different conversations there than Snapchat. chat. So is there, where do you see that line blurring in the future in terms of somebody is just suddenly is like, Hey, replica, can you help me do my homework assignment? Or is that even already happening? So people already do that. There's basically what Replica is today is a companion that does tons of things with the users. So people learn languages with Replica people talk about their careers. They do homework.

2:59:43They do prepare for important exams, important events, important conversations. So all of that's already happening in Replica. But I do think there's going to be two, ultimately, I think we're going towards the future where we're going to have two big AI products in our life. One for work and one for life. And helping with homework is kind of for life. But truly office, important thing around just truly work and office work will have something more like a Chagipiti-style tool. And the big difference is going to be in productivity. You actually don't want something like Chagipiti to reach out to you proactively and say something like, Oh my God, Eugenia, have you seen what John did yesterday when he posted on X?

3:00:31That'd just be really weird. During the show, I can't believe John just said that. ridiculous it just would be really strange and you don't want to do work where this is happening i'd argue yeah well thank you so much for joining this is fascinating fascinating yeah thanks for giving us yeah we'd love to have you back i want to do a whole deep dive on this stuff so thank you so much for joining thank you so much we'll talk to you soon cheers bye thanks for coming on and in the interim we'll tell you about bezel go to get bezel.com your bezel concierge is available to source you any watch on the planet seriously any watch and honestly if you're going to work at Lux Capital, there's some hitters in that building.

3:01:08You're going to be going up against Brandon Reeves and his Nautilus. So you're going to have to get on getbezel.com to buy something. Do it. Do it. Also, I mean, we talked about Airbnb. Wander's obviously going a different direction. You can book a wander with inspiring views, hotel-grade amenities, dreamy beds, top-tier cleaning, and 24-7 concierge service. It's a vacation home, but better, folks. find your happy place find your happy place uh john andrews coming on the show next week oh fantastic singing uh or maybe not next week the following but uh he's ready to sing so we'll probably mostly just kind of riff out the jingle a little bit more try to extend it uh we should we should run through a few timeline posts uh cotool is an agentic security platform that eliminates manual repetitive work for security teams this is a launch from yc did you see this video this video is hilarious it's it's recreating the rippling deal drama with the mole and the fake slack channel and it's shot cinematically and it's basically season six of silicon valley produced by y combinator i think yc is the yc of hbo's silicon valley reboots okay let's play it i need to watch this live can we can we pull up uh this video uh we'll go through some other timelines we'll come back to this.

3:02:25Jason says it's getting cutthroat in tech. According to reports, managers with 20 years of service that are making 600K aren't as valuable as three to five junior devs. At big companies, it's hard not to become top heavy and managers aren't needed in the age of AI. Oh, let's play this Kotul video if we can, because it's hilarious. And it's very funny if we can pull that up. But I want to talk about Microsoft. They're cutting 6 ,000 jobs. It's only 3 % of their workforce. I think this is way overstated. But we are seeing this right sizing, the post X layoffs, More companies are thinking about how they can do a little bit less.

3:02:56But Microsoft has been in the rank and yank world for its entire history. So Microsoft has always had this culture of let's do routine layoffs. This does not seem like as much doom and gloom as I thought. And I think there were two stages to the layoffs. There was basically an individual contributor-oriented day and a manager-oriented day. And so when you think about the bottom 3 % of the Microsoft workforce, obviously that's frustrating if you got laid off. I'm sorry, but it's not that crazy for a massive company that has tens of thousands or hundreds of thousands of employees to do a layoff.

3:03:306 ,000 is a big headline number, but it's not that big in the context of Microsoft. Anyway, let's go to the co-tune video. We have a mold problem. Mold problem. Got it. You want me to book you a dermatologist appointment? No, stupid. Somebody is leaking sensitive company information to our biggest competitor. Idiot. Somebody's stealing our data. That's bad. Yeah. What are we going to do about it? Don't worry. We've got our top guy on it. Done. Isn't this great cinematography? This is really well shot, right? We need a smoking gun. Buttoned up, no loose ends. We even have somebody from the court ready to serve papers to whoever it is.

3:04:04Ha ha. What? I pulled stats around search behavior to find the suspect. I noticed that they were looking for competitive research. I did some cross-referencing and then I made a report of all the data they still on. Good graphics. Really good graphics. Then I set a honeypot trap of a fake Slack... A what? Oh, you guys didn't tell me about this new Slack channel. It's him. This is the reenactment. Hold on. Let me get this. It even looks like Rippling's office. Hey!

3:04:34Hey! Hey! You got your phone in there? No! Isn't this crazy? You didn't see this? That's so good. You got your phone in there? No! Pretty impressive acting. It's so good. He definitely has his phone. If you're deleting evidence, it's just going to make it work for you. I'm willing to take that risk. You want to have a phone or you want to have a bad time? I'm willing to take that race. Send that watch to London. I do have papers and I love them. He'll give it up. He has no choice. Nice job, Luke.

3:05:04Isn't this amazing? Go to it. What a great ad. Security without the spectacle. Wow, I'm blown away. That was one of the greatest launch videos of the entire year. So many vibe reels. So many just product demos. It wasn't cringe. How was it not cringe? It could have been so bad. There were so many ways to do that video and have it come out. It could have been so bad and they landed it. And I just want to know which of the actors were professional actors versus the founders? I had no idea. I felt like the founders were in there. But I mean, everything, the zoom in on the guy's face, they just nailed this thing so well.

3:05:36It's so good. You called for the death of the vibe reel. Yes. I mean, vibe reels are fun. Also, there's the other type, which is like you have the CEO, the founder, sitting in the nice lighting and they give you the pitch and it's straightforward. And that's great too. If you can't come up with something as genius as this, like just do that or do a vibe real. It's fine. My only critique, missed opportunity for the mole to say, send that watch to London. I know. They may have filmed this before that or something. But hilarious. Also very funny because both Deal and Rippling are YC companies and YC posted this from the official Y Combinator account.

3:06:10So they're like, we're here for the drama too. Just absolutely fantastic work. Congrats to the CoTool team. really really fantastic it's lore now it's lore now the industry is going to move on it's going to be great lore and I'm going to be saying send that watch to London send that watch to London still in 30 years because it's an iconic line yeah and we also got to give a shout out to Lee Marie Braswell former colleague of Mind & Founders Fund now at Kleiner Perkins Windsurf acquisition by OpenAI followed by Neon by Databricks congratulations LM we have to have her on the show soon what an epic month year career so far LM just getting started just getting started just getting started She's just getting started.

3:06:46A lot of people say that and it's like, you actually are just getting started. Yeah, no. She's definitely started. She's started. Anyway, are there any other posts you want to go through or should we get out of here? I think we should have Josh Steinman on to talk about industrial sabotage. It's a long thread. I don't think we want to go through it right now. Yeah, I saw this. I mean, you put in a post about the CEO of Capital One is literally called Rich Fairbank. And I think that's enough for today. We already mentioned that to Josh Wolfe. So good. Go find Josh's thread. What a fantastic image.

3:07:19Just Rich Fairbank. Rich Fairbank. There's another person. I found it in Josh's thread who works for McDonald's and some VP over there. Her last name is Hamburger. Hamburger. That's great. So good. Thank you so much for watching. I'm going to end and just say thank you to Figma for supporting the show. they are our newest partner and one that I Redesign how you design I can't hide how excited I am You love Figma Like I said I've been at DAU my whole career You were making memes in Figma like yesterday sending them to Dallion and they were fantastic For Dallion's eyes only Yes Also AdQuick I think we might have missed them Out of home advertising made easy and measurable Say goodbye to the headaches of out of home advertising Only AdQuick combines technology out of home expertise and data to enable efficient, seamless ad buying across the globe, adquick.com, buy a billboard, folks.

3:08:14Thank you to all of our partners. And again, our board of directors has reminded us in a very forceful way that we have to ask you to go leave a review on it. Five stars, Apple Podcasts, Spotify, do it now. It helps us in some way. We don't really know how, but we're asking. The board says. Demands it. Our jobs are on the line. Yeah. Thank you for tuning in, folks. We've got another great show tomorrow. Looking forward to it. Bye. Cheers. Thank you.