Crémieux & Kian on Nucleus Genomics, Michael Kratsios on Genesis, Nvidia Responds to TPU Progress | Kian Sadeghi, Joe Weisenthal, Sebastian Siemiatkowski, David Faugno, Keller Rinaudo, Royce Branning

29:23That's at least what the timeline is accusing. That's what the lawsuit alleged. Okay, wow. That's wild. I did not know that that was a literal accusation. And then another part of it, apparently, Nucleus, it's new people at nucleus were emailing the former co-founder at his old email address evidence of them violating the the agreement that they had so anyways it's very very very very messy we can ask yeah there's like four or five companies involved in this and all of them or controversial because this is the most i think the most controversial probably like category that you can be in yeah it's it's certainly up there health is already like one of the most controversial topics yeah everyone has an opinion on health influencer they've gotten into totally various debacles yeah um uh and also there's just like the uh there's just it's so easy to throw i mean in the same way that people are throwing enron at uh at nvidia like it's so easy to throw Theranos at any biotech company that's not, you know, that's accused of anything.

30:35And also biotech, it's like, it's pretty hard to understand the underlying science. It's not as popular as, okay, like, does the website work? Does the business make money? You know, what's the cash flow like? It's way more complicated. And so it does attract even more attention. So one of the other companies in the space is Herosite. And Astral Codex 10 continues here. They enter the space with the most impressive disease risk scores yet, an IQ predictor worth six to nine extra points, and a series of challenges to competitors whom they call out for insufficient scientific rigor. Their most scathing attack is on Nucleus itself, accusing its predictions of being misleading and unreliable.

31:19Let's start with the science and then move on to the companies to see if we can litigate their dispute. In theory, all of this should work. Polygenic embryo screening is a natural extension of two well-validated technologies, genetic testing of embryos and polygenic prediction of traits in adults. So genetic screening of embryos has been done for decades, usually to detect chromosomal abnormalities like Down syndrome or simple gene editing disorders like cystic fibrosis. It's challenging. We've talked about this before. you need to take a very small number of cells, often only five to 10, from a tiny proto-placenta that may not have many cells to spare and extract a readable amount of genetic material from this limited sample.

32:05But there are known solutions that mostly work. And so the companies that we're talking about today aren't necessarily doing like the fundamental lab, equipment development, building the machine, figuring out how to sequence data from the first. It's more about the analysis that happens on top of the results. And the recommendations. And the recommendations. Which is probably, which I would say is the most controversial part of this. I don't know that any of them are recommending, hey, we think you should pick this baby. They're more just saying, like, we think that, according to the data, this baby might be taller than this one.

32:40But if you're giving somebody a risk factor, if you're giving, if you're... Yeah, but that's not a recommendation. Like if I tell you this car is 700 horsepower and does zero to 60 in two seconds, and this one does 800 horsepower and does zero to 60 in 2.4 seconds, this one's faster in a straight line, this one's faster on the curves, and then like you pick. Like I didn't make a recommendation. I just told you the stats, right? Yeah, but from when you look at these companies from what they're marketing to consumers of why you should care about the service. Sure. And then the way that they deliver the information, If they're advertising, effectively advertising, we can help you have a smarter, healthier baby.

33:19And then they're saying like, hey, we think this direction is going to get you a higher IQ. I don't think it's a recommendation. It's not an explicit recommendation, but I think people are trusting the service to try to get them what was marketed to them. Yeah, people want the data and they want the data to be accurate because they're going to make a decision based on that. But I mean, here, Scott Alexander actually gets into some of the complexity of the actual trade-offs because there are, so most traits are polygenic, requiring information about thousands or tens of thousands of genes to predict.

33:59These are too complicated to understand fully at current levels of technology, but some studies have chipped away at the problem and gotten to a partial understanding. Often, this looks like being able to predict a few percent of the variance in the trait to determine whether someone's genetic risk is slightly higher or lower than average. And so some people might genuinely want to select on a single condition. For example, people with a strong family history of schizophrenia might want to minimize their chance of their children getting the disease. For these people, reducing schizophrenia risk by 58 % while keeping everything else constant sounds pretty good.

34:34Everyone else probably wants a genetically healthy embryo with low risk of all conditions. Exactly how this works depends on the customer's own value. Would they prefer an embryo with lower cancer risk to one that will have fewer heart attacks? That's a trade-off that you have to pick. And the exact benefits will depend on how parents make that decision. Genomic prediction and heresy try to help by providing semi-objective measures of which embryo is overall healthiest according to different conditions, effects on longevity, and patient-rated quality of life for genomic prediction. That's the embryo health score.

35:12This is close to a recommendation. I think you're getting close. Yeah, and Nucleus's subway campaign is have a healthier baby. Yeah, yeah. The marketing claims are a big, big piece of this. I think the scientific claims are potentially just as important, but they're both understanding where the science actually is, both broadly and then also within the companies, and then how it's marketed. All of that is important to get a complete picture of what's going on here. So for Herocyte, it's a polygenic longevity index. They don't give exact risk reduction numbers for each disease, saying that it depends too much on a couple's specific family history, but say that most people gain one to four years of healthy life.

36:03When I test it on a set of 20 embryos, the healthiest gets an extra 1.66 years. And so how much would you pay to give your children an extra one to four years of healthy life? This is no longer a hypothetical question. Here are the costs. Genomic prediction is around$3 ,250. Orchid is around$12 ,500. Nucleus is around$9 ,249. And Herocyte,$53 ,250. That is expensive compared to the rest, five times the price. Is it worth it? Well, if you're already doing IVF, the claimed risk reductions are accurate. it, you value your kid's health as much as your own, you have low time discount rate, you're well off enough that these aren't extraordinary sums of money to you, you're okay using expected utility calculations where a 50 % chance of preventing X is half as good as fully preventing X, then I'll go out on a limb and say, yeah, it's obviously it's worth it.

37:01Consider genomic prediction, which costs$3 ,500 for five embryos and claims to lower absolute risk of type 2 diabetes by 12%. That implies that not getting type 2 diabetes is worth$27 ,000. Ask anyone dealing with regular insulin injections, let alone limb amputations, whether it would be worth$27 ,000 to wave a magic wand and not have type 2 diabetes. It's not a hard question. And that's just one of a dozen conditions you can lower the risk for. Other ones, like not getting breast cancer, might be so valuable that it's hard to even attach numbers. So what about IQ? Six extra IQ points, which is Herocyte's estimate with five embryos, is about a quarter of the gap between the average person and the average Ivy League student.

37:46The benefits of intelligence are hard to quantify, but it's been shown to have probably causal positive effects on income, mortality, and achievement. Probably the income effects alone make up for the cost of the intervention. Again, assuming total parent-child altruism and a low discount rate. So if we accept all of these claims and assumptions, the choice seems obvious. It's probably even obvious for governments to pay for all citizens to get these given how much they'd save on health care costs, says Scott Alexander. But in practice, it's complicated. Critics have raised both scientific and ethical objections to polygenic embryo screening.

38:23Most significantly, it's been condemned by various bodies, including the Society for Psychiatric Genetics, the European Society of Human Genetics, and the Behavioral Genetic Society. Their statements are not good. They tend towards vague language about how people are more than just their genes or how no genetic test can be perfect or how embryo screening is not exactly the same thing as some other form of screening, which has a longer history and more proponents. Although, quote, although in general higher scores mean you are more likely to have a condition, many healthy people will have higher scores.

38:58others might develop the condition even with a low score, says the Society for Psychiatric Genetics, as if they have just blown the lid off of some dastardly conspiracy. Screening embryos for psychiatric conditions may increase stigma surrounding those diseases. They continue an objection which, taken seriously, could be used to ban every form of medical treatment because if you take care of something, you remove them from the population. That might increase the stigma, but we should still treat these. So he says, we will mostly ignore these people and try to imagine the implications that mildly competent credits might raise, some of which will coincidentally overlap with the content of the non-hypothetical statements.

39:37So the big question he wants to answer is scientific objection, the scientific objection around efficacy. Are we sure this works at all? Are we sure this works? So a typical polygenic score is created by collecting thousands or millions of adult genomes, then matching genetic information with surveys about who has the trait slash condition of interest. Reputable studies then test these scores on holdout samples, adults who were not used to make the score, to see if they still accurately predict who has the trait slash condition. Polygenic embryo selection depends on an assumption that the scores which work in these kinds of retrospective tests will also work on prospectively on embryos.

40:20This assumption hasn't been formally proven in studies, which would require years or decades to conduct. but seems commonsensical. The strongest challenge to the application of polygenic scores for embryo selection comes from a recent body of research showing that most scores combine causal genetic effects with population stratification, and therefore can be expected to lose much of their predictive power when comparing two members of the same family. There is an increasing agreement in the field that unless scores are validated within families, headline results like decreases risk of X by Y percent will be large over estimates.

40:57When I talked to company representatives, they all said that they took accuracy extremely seriously and had various white papers and journal articles where anyone could double click, could double check on their methodology. But I attended an industry conference a few months ago and the gossip level was comparable to a high school cafeteria. Minus the sex rumors, most of the attendees were having their kids via IVF. Everyone had some story about someone being careless or fudging their numbers. Some of the conflicts broke out into the open on Wednesday when Heresite left stealth and published a white paper and associated blog post.

41:36They criticized genomic prediction for reporting between family rather than within family results. And Orchid for smuggling a term for age into their Alzheimer's predictor. Unsurprisingly, this makes it work better. We'll get to their accusations against Nucleus below. Note that this was recent enough that competitors haven't had time to air their own criticisms of parasite if this happens. I'll try and keep you updated. And to be clear, this article is from around five months ago. Yes. And since that time, Nucleus has been accused of plagiarizing the paper. From Heresy. Just discussed. From Heresy.

42:20From Heresy. Yeah. And then also accused of stealing IP from genomic prediction. So there's, again, a bunch of different accusations. We'll let Keon talk about it. Yeah. Yeah, I mean, the goal here is to just give an opportunity for, you know, Cremieux and Keon to answer some questions, try and contextualize it, try and make their case to a broader audience. You know, I've read through as much as I can, but without actually getting in the lab and rolling up my sleeves, I don't think I could come to a firm conclusion here. but I can certainly talk to them on this show and hopefully get some more information that the community can do with what they will.

43:05So Scott Alexander concludes this section talking about his strongest opinion of the scientific criticism. He says, authorities on all sides have cited Alex Young as an authority on how polygenic scores can be confounding or misleading. Last week, Alex Young revealed that he had been working with Herasite while it was in stealth mode and endorses their research. Three, LOL. Probably that means Herasite's products are okay. That serves as proof of concept that this technology can work and means other companies' claims are at least plausible. So lots of back and forth, and we will be joined by Cremieux in just a few minutes.

43:49I actually need to message him and make sure that he has the information. Is there anything else that you think would be worthwhile to discuss before we hop on? Let's... Yeah, and I can just go through. I mean, the original accusations came from an account called Sichuan Mala. Sichuan Mala, yes. Who wrote an extremely lengthy blog post on a a bunch of the issues that they felt they had found with Nucleus. Nucleus ended up firing back and saying that Sichuan Mala was, or sort of implying that Sichuan Mala was funded by a competitor or competitive service, as well as making those allegations with Cremu.

44:36Yes. They go into issues around potentially fictitious customer reviews, which we'll ask Keon about AI-generated blog posts, accusations of intellectual property theft, saying that the Nucleus origin white paper is plagiarized, saying it has a bunch of errors. Nucleus has responded already to a lot of this stuff. Well, our first guest of the show is here. Let me tell you about Linear, Meet the System for Modern Software Development, a purpose-built tool for planning and building products. we will bring in Cremieux from the Restream Waiting Room into the TVP and Ultradome and have him set the table for us.

45:19Cremieux, how are you doing? Welcome to the stream. How are we doing? Glad to be here, guys. Thanks so much. Can you hear me? Good, as always. Looking good. By the way, I can go FaceDocs if you want. Let's do it. Let's do it. We can show his actual video this time, which is great. We've had him. Welcome to the show. Hey, hey. Good to see you. How are you doing? Uh, uh, what, what, what actually kicked this off for you? Do you know, uh, Sichuan Mala, uh, separately independently? Did you know that this was coming? Um, set the table for us. Like, why did Nucleus come to the top of your mind? So can I actually go back to, uh, Hereticon with this?

45:59Yeah. All right. So for about a year, we've told Nucleus, uh, about issues with their products. Can I just actually give a big, like I can monologue on this for a minute. I can tell you a lot of the details if you want to go into it. Go right in. Okay. So one of the early things that really peeved a lot of us who are aware of how this tech works is that Nucleus claimed to provide parents with information about rare variants based on microarray files. Their website's wording is incredibly ambiguous. So the excuse when I raised this to Key in in person was that they were referring to imputing a child's embryo or a child or an embryo's microarray-based data with parental whole genome data.

46:41But this is not sufficient for rare variants like they claim it is, and it only works out very well in narrow, well-behaved cases. It's not a clean substitute for sequencing an embryo or child. The rare variant information they can offer is limited, and their claim is highly misleading because it sounds like they can achieve coverage of de novo rare variants and ultra-rare variants reliably for children and embryos, but they cannot do this because of like crossover that happens during recombination inside the haplotype blocks you're using to do the amputations. Uh, and because of mutations, they can't, they can't even get high confidence coverage of rare variants more generally, which is what their big claim is about, uh, in specific wording, um, with the imputation based methods they claim to be using.

47:20So everything they say has a huge error bar on it and it's, they shouldn't be advertising it. Basically, it's something incredibly misleading. Uh, and to get an idea. So, so, so just to like actually zoom out, like, what do you think they are capable of doing? I think they are capable of microarray sequencing. I think they're capable of... I mean, in terms that you could advertise to a parent, like if Keon went to a prospective parent, the parent says, I'm doing IVF. What can you do for me? Is this category even ready for large scale out of home advertising? Do you think... It absolutely is. The issue is that Nucleus should not be doing it because Nucleus has produced scores that are invalid.

48:06They're incredibly invalid. Like, for example, they used an ADHD score that included 12 single nucleotide polymorphisms. They claimed it explained 4 % of the variance in ADHD, which means it's a pretty good predictor and you can use it to get some improvements on the margins. but 12 snips means that there's just no way uh they could explain less than one percent of the variance and the best current adhd polygenic score uses more than a million snips and explains about one percent of the variance so they just basically lied they made up these numbers um and harriside had to go through and show that oh actually a bunch of their numbers are made up yeah i mean How do you know for sure that they're, I mean, like that claim, you know, the state of the art was, was a million for 1%.

48:55Now it's 12, Nucleus is claiming 12 for 4%. That seems like a huge exponential, you know, growth in efficacy of that particular test. But just an exponential progress, it is not necessarily evidence of malphesis, right? This isn't progress. They've never been able to show that they can use 12 SNPs, and no one can. It's impossible. They don't explain this much variance. It's literally physically impossible. It's not possible in any way. They should never have claimed it. They should never have provided score reports to people based on it, and they did. They provided customers with score reports that have to be fake.

49:32Not fake per se, but they have to be incorrect. They have to be wrong. There's no way they could stand up to scrutiny. What I'm saying is that after they made this 12 SNPs to 4 % variance claim, people have looked and they've shown the latest ADHD polygenic score, which is more recent than what they've claimed to have on offer, uses more than a million SNPs and explains about 1 % of the variants. It's just, that's the state of the art. They are claiming to have better than the state of the art with completely implausible parameters. It is impossible. Okay, so back to the original question, what do you think they actually could offer, even if they say, hey, you know what?

50:10We're not necessarily state of the art. We're partnering with a lot of different labs. We're standing on the shoulders of giants. We're using the tools that are available. What is a reasonable claim that if they made it, you would be like, yeah, that sounds reasonable? A reasonable claim from Nucleus is that they are pulling polygenic scores from the polygenic score catalog, a publicly available resource that lists a bunch of different polygenic scores from different genome-wide association studies. That would be reasonable. But that is not a, why would you go with them then? They have nothing unique to offer.

50:43What they have offered that seems to be unique are claims that don't hold up to scrutiny or which are clearly plagiarized from one of their competitors. Yeah, well, there are plenty of services that are effectively wrappers around Quest Labs. And I get a better UI, and it tells me that my cholesterol is in the range. And yeah, I know it's just looking up the range from the data, but it has a nice UI and a reasonable billing system or whatever. and people pay for that and they make decisions about their diet based on that. And I don't think that there's anything necessarily wrong about providing something that's a commodity or not a scientific breakthrough, as long as you're honest about what you're doing and you're not inflating the results.

51:29Yeah. The problem is that they're inflating the results. The problem is that they are effectively making up the results. In their latest report, they have claimed to basically match heresite. Not claimed to directly. They've copied their very unique citations, which no one else has made. They've copied their method. And copying their method is incredibly weird. You mentioned there that Scott Alexander noted that Alex Young is seen as a big authority in this space. And it's true. Alex is seen as the go-to guy. If you want to learn about family-based sampling, trio imputation, if you want to learn about within family validations or imputations or quality control, you ask Alex.

52:08That is the thing to do. And they apparently copied Alex Young's quality control pipeline. And it's very unique. So doing this is unusual. It's unheard of. It's not likely to have actually been done. It is like saying that you woke up one day and here's my morning routine. I woke up and today I was John Coogan. And I brushed my teeth exactly three times each time around. And I went and prayed to my household God. I did like all sorts of things. And it's just, it's incredibly specific in a way that is very unlikely to be real. They've very likely just kind of mimicked exactly what they said. And they said they did it on additional data, but the results came up very close, which is not likely.

52:48We have strong theoretical genetic reasons to expect that if they had this additional data that Herocyte did not, the results would have actually looked different. So they have all these signals that they didn't do the analyses they said they did and lots of indications that they plagiarized. And when Sichuan Mala called them out, they responded. The response they generated was amateurish. It was kind of embarrassing because they admitted simultaneously to denying they did the plagiarism. They admitted to doing the plagiarism. They copied, they admitted they copied things directly from Harasite.

53:22They admitted they use resources that are unusual to use and they effectively got the data from them. and they did nothing that was really unique. Okay. They did a, so, so, so copying might be, you know, looked down upon in tech. People copy stuff all the time. The, you know, stories was copied into Instagram from, from Snapchat, different, different machine learning architectures are being copied constantly. Some stuff can be patented. Some stuff is, can be trade secrets. Are we looking at anything that's, that's, that goes beyond just like, yeah, it's kind of bad form to copy or, or is this something that's actually like a problem beyond that?

54:04Yeah. Would you, would you be less angry if they copied it perfectly instead of like sort of copied it directionally? They copied a lot of it perfectly. And this leads to weird results because they should not have done that given the cohorts they used. They used separate data for their validations. So the results should have been different. They copied details that made it apparent that they were not using the data they claimed to, or they were just fudging the results. It has to be one or the other. There's no way they could have gotten the results they did with the data they did and the copying they did.

54:34The copying tells us that they lied about something somewhere along the way. There is something fishy here. And we don't know what the exact error is. We just know they have to have made an error because there's no way that the additional data they had access to was identical to all the data their competitors used. It would have delivered different results. So I wanted to ask, they released open weight models, the Origin models. Part of their pushback against Sichuan Mala's critique is that anybody can just download the models and play around with them. Have you downloaded them? So you have to ask for access, and they do not give out access.

55:16We've had multiple people go in and try and ask for access, and they've not received it at all. and one person who asked for more information was told, stop contacting us. So no, they are not open at all. They're open in the sense that OpenAI is open. They're not very open. Okay. Got it. Shifting gears to the marketing claims, what stuck out to you there is particularly in need of addressing? they very much need to address the fact that they seem to have fake reviews. So when they started Nucleus Embryo, they launched it in June. They weren't offering any sort of embryo screening services beforehand.

55:55And if they were, then it would have been how. They have to specify what lab they use for all this stuff. There's a lot of details that should go into this that they can't actually specify because they didn't do that. So they claim to have had customers that have already been served by this. Well, as everybody knows, it takes about nine months to serve a customer in this at minimum. And it has not been nine months since June. It takes a baby in one month. It takes a month. So I'd love to see these three-month-old babies that came out perfectly and made their customers so happy. But I don't think they exist.

56:29I think they're not real. So why do they have these reviews? I don't know. And the reviews are also, they have a lot of fake elements. There are some that are clearly fake. So they use stock images in these reviews to show their customers. Which, to be clear, you can imagine a scenario where they use stock imagery and fake names and they put an asterisk and say, due to HIPAA compliance reasons, we're not just publicly displaying, you know, the names of any of our clients. But there's, there's no issue revealing this stuff. And other companies do actually reveal the real customers. So Orchid has revealed real customers.

57:02I've been introduced. I've met, uh, hair site customers. Oh yeah. Didn't Jason Carmen do a whole video with Knorr in the first, uh, in the first, uh, Orchid baby. and has been basically making a documentary about that person's journey. There's no... Yeah. And I feel like I see in drug commercials all the time, it'll be like, this is a real customer who loves this hair loss meds, and they're like, yeah, it looks great. Yeah, but it seems much harder to get... It's probably much harder to get somebody to opt into that than just opt into generally providing. Sure. Sure. Clearly it's possible. Is that legit, you think?

57:40No, they still could not have had the babies in time. It doesn't fit with the time. The chronology doesn't work here. These customer reviews are not really physically possible. And I'd like to see an explanation from them because it doesn't make any real sense to me. They could be, I don't know, making some sort of representative review that they've maybe hedged in some fine print on some page somewhere. But I haven't seen it. And their entire site has been archived now. So if that page exists, they'll have to show it to us on the archive. One thing Jordy and I were debating was this big question of like, is Nucleus making a recommendation or not?

58:13I don't know if this is relevant, but I would love your take on this. this idea of like, you know, I see an ad that just says like height is 80 % DNA based or genetically inheritable. And then you go into the dashboard and it just says, here's the predicted height and here's the predicted, you know, IQ. And then you make the decision and it's not necessarily they're recommending one or the other. It's more of a diagnostic and you can do that information what you want. Does that, does that absolve them of some sort of responsibility there? No, it doesn't. So if you still provide wildly inaccurate scores, then it doesn't matter what you're recommending.

58:51You are effectively just recommending something that doesn't matter. I mean, you are giving them incorrect recommendations. You have to give some range of uncertainty within the best of your ability. You have to give them something that is to the greatest extent knowable, reliable. And they can't have done that. They've provided scores that they know, they must know are incorrect. You can't explain 4 % of the variance with 12 SNPs. It's not really feasible. There's no possibility of it, really. There's also no possibility of getting high confidence coverage on rare variants from the imputation methods they've described.

59:24So they can't make parents certain about this stuff. They're saying lots of things that would require them to basically advance the science 20 years. They would have to be leaders in innovations here. And I just kind of doubt it. The people who are actually leading on the innovations here are Herosite. Orchid is doing so as well. They're doing a lot of Orchid's whole genome sequencing of embryos is the only one in the industry available to do this. And Heresite's innovation is that they've made this stuff low cost for what they have admitted is a reduction in quality if you get PGTA-based imputation.

59:57Now, another thing I do want to mention, though, is that Nucleus might – and I'm still looking into this. I'm collecting some patient reports. I found one from my friend Dylan. She got a report from Nucleus, and she got one from Inviting. It was a whole genome sequencing thing done. and Nucleus, and I did see the report, Nucleus said she had a Mendelian disorder, a monogenic disorder caused by one gene, and Invitae said she didn't have it. Okay, this is weird. So what's the inconsistency? We don't really know. Nucleus recently changed this result. Now, per the law, you have to notify your customers if you change their sequencing results.

1:00:35This is a CLIA regulation, The CMS regulates this, and that is a potentially major issue that they might be out of compliance with. And I understand that startups are often out of compliance, and a lot of them fake it until they make it in terms of following the letter of the law. But I'm of the opinion that they really shouldn't, especially because this is serious tech with major implications for people, their families, and all future generations of their families. This is, as I think Jordy called it, bloodline optimization. And we have these rules in place for a reason. You need to show you're abiding by them.

1:01:06Yeah, how much do the other players in the category, how much are they worried about Nucleus just kind of setting back the entire category? So I have gotten, it's on video, and because Kian tweeted about being in it, I'm allowed to say that we were at a private conference, and I did lead a panel on this topic where Kian was one of the panelists, and the heads of some other embryo selection companies were also on the panel as well. And I will say that everyone was worried. Everyone was worried about one of the major missteps that actually has already been addressed by another one of the companies and the series of major missteps made by Nucleus that they have failed to address.

1:01:48I warned Kean about this stuff many months ago. I've warned him about problems for more than a year now, and he has simply not addressed them. They're still there on the website. You can go find them. I've archived these pages a few times to see, are they getting to them? Are they getting to them? answer is no. They are still making claims that are either not possible, not possible with the current tech, might be possible in 20 years, or just don't seem consistent with the evidence that they provided to their customers. Okay, last question, and then we're going to hop on with Kion. I'm a big believer in redemption arcs.

1:02:22You're obviously unhappy with Nucleus's behavior in the industry. What does redemption look like? What would Kian have to do or show you to get back in the good graces of the industry, in your good graces? So the whole industry knows that Kian has been a problem for a while. And we actually, a lot of people have tried to give him a redemption arc already. They have tried to come to him. They have given him clear advice on what he needs to do. They have told him, you need to stop making X, Y, Z different claims. They have told him you need to offer scores that are vetted. You need to be open about your vetting.

1:03:00You need to be open about your sources. You need to qualify everything like the other companies do, but you haven't. He has been told this for a long time. I sent you some pictures earlier today. You can see the panel we're on where clearly like this has been a thing that's come up a lot and we wanted to give him the arc already, but it came to this. It came to a person going online, a blogger deciding, hey, I'm going to look into this after reading the various blog posts and saying, well, shoot. So to make up for it, I think they would need to be incredibly open and they need to apologize and they need to admit to what they did wrong.

1:03:32And they need to say that they were out of compliance with CLIA rules and regulations. And they need to say, Hey, we might've misstepped here or there. We didn't know we were doing this or whatever, like whatever it takes to be accurate, document everything, tell us everything you've done. Tell us all the missteps. Don't exaggerate. Do not lie. Just be upfront with everyone and submit yourself to regulation. Not in the sense that you have to go and tell the regulator you want to implement whatever new rules and regs, but submit yourself to openness. Be really open. Stop this whole thing about not telling us your methods, which they've done, and Sichuan Mala has documented that in the latest blog post.

1:04:09And give us your data. Give your data out. Stop saying it's going to be available upon request. It doesn't matter if your competitors have it. Offer better pricing or something. Compete on some other margin because we shouldn't have to compete on trusting you. I'm going to say we. I don't have a company in this space, but everyone should be trusted. All the companies in this space need to shape up a little bit and they need to be a little more open. Kian needs to do that the most. Thank you for coming on the show and breaking it down for us. We appreciate you taking the time and walking through all of that.

1:04:40Have a great rest of your day. Who knows? You might be on the show very soon as this debate continues. So we really appreciate you taking the time. Thank you. Talk soon. Have a good one, guys. Bye. Before we bring in Kion, let me tell you about Fall. Build and deploy AI video and image models trusted by millions to power generative media at scale. And we have Kion from Nucleus in the Restream waiting room. Let's bring him in to the TV pin ultradone. Kion, good to see you. Wish it was less dramatic circumstances, but it makes for good TV. And we're happy that you're here and we can chat about this.

1:05:16And I mean, I'd love to just give you the floor. I'm sure you saw some of the early segments. Where do you think it's important to start? Where do you think it's most important to set the record straight as a first point? And then I'm sure we'll have a bunch of questions. Well, I didn't see what Kramu said. I was busy helping a patient. But I think the key thing to remember is that Kramu and I, we are definitely aligned on doing great science. At the end of the day, that's what we want to do. We want to serve the patient. We want to do amazing science. I think what we're not aligned on is Cremu basically for several months has not disclosed that he's been affiliated with a competitor.

1:05:53And, you know, that wouldn't be so much of a problem unless they're basically concerting together. And so that's on the Cremu side of things. But honestly, that's like the less important thing to me. Yes, I agree. I think that's less important. So I've seen him post positively about your competitors. I've not seen any proof that he's actually being paid or has equity in that competitor. But to me, it almost doesn't matter. It could, like every single post from him and Sichuan Mala could literally be from Norit, Orchid, or someone who wanted your competitors. You still need to address it, right?

1:06:27A hundred percent. Cool. And so first and foremost, I'm going to say that our science is completely public and it's been completely public. So one thing that it's really important to say is that anyone, and by the way, we've at this point have shared our models with over 15 different entities, which includes, by the way, people affiliated with our competitors, several of them. Just to be clear, I mean, Cremu said that a number of people that he's aware of have requested access to the models and not been given access and been told to stop reaching out. And so I do think, I don't know. Completely, utterly inaccurate and false.

1:07:04There is not one person who has filled in the nucleus origin type form, which is a type form. It's filling a type form that has not gotten access to our model weights. And by the way, that includes people affiliated with the competitor. And so I think what's really important here is the science is public. The message of the community is go and test it. In fact, our science is public. The competitor's is not. So what I would propose is they should make their science public and let's have a third party independently evaluate the rigor, the quality of the science, and let's do it for everyone to see.

1:07:39Instead of he said, she said, they tit for the tat, you know, put the science out there. Have a third party independently evaluate them. That is my message to our competitor. We are happy to stand behind our science and we know that it's the highest quality science that can exist today. But by the way, John, that's not even the point either. You know what the point actually is? The point is about the patient. It's about having the empathy with the patient so they can know when they do embryonic selection, they can feel comfortable and confident in the results. And this Twitter back and forth, this tit for tat, this, oh, this person's race changed on the nucleus landing page, it's ridiculous.

1:08:17It's really ridiculous. And so that's my message. Speaking of the patients on the landing pages, what about the chronology here, this idea that there's a review of a baby with three months old, takes nine months to work with a baby, should have happened a year ago? Was the service available a year ago? How do you square that particular allegation that the timing of the review just doesn't line up with what must have happened in the real world had they used your service? There were several claims about the reviews. Let me address each. Please. First and foremost, obviously as a HIPAA-covered entity, we cannot disclose patient name, much less their picture.

1:09:00If a patient chooses to, they can publicly endorse the company and they can put their name in their picture. Otherwise, a patient can submit an anonymous review and then we'll put that according to the landing page. And so maybe perhaps the people on the Twitter timeline, maybe they never run a company that involves any protections to the patients. maybe they don't know about this maybe in like the broader tech community it's like unfamiliar if you run a software company it wouldn't make sense necessarily does not disclose the patient name and i'm going to say to john this is really important do you think you have to disclose the fact that you're using an ai generated image is that best practice or is that legally required you know what i think we should do though is now that the community gave us this feedback is we should update it make it more clear hey this is clearly not a real picture and this is both but not a real name that's reasonable okay now fraud this that guys really come on okay we'll update it we'll make sure that the picture and also the names are more clear yeah but again we're a hip covered entity you can imagine when you launch an embryo product specifically people do not want their name to be affiliated with it i mean you have non-accounts that don't want their names affiliated with these things imagine a patient actually underwent nucleus's services yeah so now regarding the timeline thing that's the second thing you mentioned i want to directly address that as well.

1:10:15Obviously, a company like Nucleus can start providing services to patients earlier than when we publicly launch a product. Moreover, you would imagine the services that you provide to patients would be the ones that actually the beta service that you provide to patients would be the ones that you'd have reviews for. Obviously, because they do the services prior to the company actually launching the services publicly. So that's it. That's the answer. So you were using the service before, maybe a year ago or something, then you announce the service. And that's why the results are. We had a request, John, to do embryo analyses probably three years ago.

1:10:52Yeah. I would wager that, you know, that actually was probably one of the first times before any of these companies to actually provide this sort of services. So we didn't think about this for a long, long time. Yeah, of course. Yeah, it makes sense. It's a very logical place to go. It's also a very competitive industry. There's a bunch of reasons why you'd want to play in that space. What about the delta or the perceived gap between the marketing claims? What's on the billboard? What's in the New York subway? I'm seeing 50 % IQ, 80 % height. They feel like bold claims. What's actually possible?

1:11:28What can customers actually get from Nucleus today? What could they get a year ago when you were beta testing the product? I want to interrogate the gap there. So, to be clear, there is no gap. Have a healthier baby. Have a taller baby. Have a smarter baby. IQ is 50 % genetic. Height is 80 % genetic. These are just facts of the matter. The latter two are herdability estimates. They are what they are. The former two are basically describing what you can do with nucleus. What I think is interesting here is actually broader commentary. Nucleus is bringing the science mainstream. We are taking it out of the little echelons of the rationalist community, the little echelons of the scholars going back and forth, out of the Twitter alleyway.

1:12:20And we're bringing it to the actual people who will benefit and use these services. I cannot tell you when you actually talk to a patient, not somebody on tech Twitter, when you talk to a patient, they have no idea this technology exists. And the first time they're discovering it is when they go and they actually see the campaign in the subway. And now I think it's personally good for the entire industry, right, where you actually bring broader awareness. It lifts everybody, us, our competitors, and makes this actually more and more into a space. It's very early. My advice to our competitors is focus on serving your patients.

1:12:52Because at the end of the day, the market's huge. And this market is extremely in its infancy. And I think they would push back and say the industry can't afford to be sloppy. And I think that the I agree that I think it's a fair allegation that some of the ways that nucleus materials have been presented have been sloppy. Do you I guess one question I have is what are you specifically talking about? What has been sloppy? uh specifically the like the reviews the reviews are sloppy i i totally understand using using an ai image or using a stock image without making it clear that that this is anonymized because of hipaa if it just said if it said at the bottom and their little asterix that anonymized because of hipaa i think everyone would be like oh yeah that makes sense like they made a choice and i think that's like the first thing that i would count as like sloppy yeah That's fair.

1:13:53That's fair. And we're going to update that. Do you think that's proportional to the temperature on Twitter? I think this is the most politically charged category in technology. And you can't afford to, you can't, like, basically the industry as a whole, I don't think, can afford to make a lot of mistakes. I completely agree. This is going to involve the health of all the industry's clients. There were allegations, too, that you guys had updated a test result on the fly. I have no idea if this is true, but I saw the claim going around. Somebody had gotten a certain test result, and then it had been updated two weeks later.

1:14:38Yeah, what's going on there? What's happening? That's super interesting. Nucleus, remember guys, unlike these other players, we've served thousands of patients. Sure. And then we can go on our website right now and use our product. They can see our services, right? I mean, I think it's really funny what's flying around when someone could just go and buy a DNA kit and see the product for themselves. Yeah. Okay. So the idea that, oh, we updated a model, we've updated models for the last several years. I mean, results will change. We make that very clear. And by the way, any embryo selection company, Nucleus is full stack.

1:15:06We do adult DNA testing analysis. We also do the embryo and also do a full end-to-end IVF experience. We're kind of multi-product. But these models will evolve. One point here, which is important to mention, people have a very good intuition when it comes to AI that chat TPT is going to be better next week. Grok's going to be better two months from now. The same expectation has to be communicated to the genetic optimization industry. The main limitation for building polygenic predictors is data. It's a data problem. And so what's going to happen is all the different polygenic predictors are going to be approximately equivalent until we get more and more and more and more data or people get more and more access to data.

1:15:46That is the fundamental bottleneck of the industry. In other words, similar to actually the AI situation, all the value is going to shift downstream to the application layer. The reason why people are so upset is because Nuclease has excellent science, rigorous science, and we have excellent marketing, excellent product, and we've served more patients than all the companies put together. But if somebody gets a result and they make a decision based on that, and then a few weeks later you come in and you say, actually, it was different than what we said. but they've ultimately made a decision that they cannot correct.

1:16:27Is there a regulatory framework? Yeah, that's a tough, that's a very tough situation. Is there a regulatory framework that requires you to communicate to patients that... 100%. And do you guys do that? So we're a CLIA certified, of course. We're a CLIA certified CAPACredit laboratory. Any single time an update is made, it'd be reflected in the physician report of the respective customer. And also importantly, remember, there's a lot of disclosures, There's a lot of different consents people have to sign when they sign up for genetic testing services. One of them is, of course, that the results can and will be updated.

1:16:59And that applies to everybody in the industry. And that, by the way, applies to any lab-developed test. The tests are getting better as more data comes in. Software improves. That is the nature of how these things go. That's something that Nuclid has been very upfront with. We're very upfront if results do update or change. Yeah. Yeah, I'm super – yeah, yeah. I mean, we were, we were talking about like, there, there is a world and this, I think this is why, uh, the marketing is really like so important for what you do. There are so many other, uh, industries where, uh, if, if, you know, if, if I'm, if I'm watching and if I see a billboard for Instagram and it says like the most entertaining images on the internet and I download it and like, I'm like, this isn't as entertaining as YouTube.

1:17:41Like I feel like, ah, whatever, you know, it's not that big of a deal. Um, but, but the worst thing that could happen is, is I, you know, someone does nucleus with their, their embryo. It's, it's accurate, but there's a minus sign in front of everything. So instead of like the tall and smart one, they get the shorter, dumber one, and then they can never go back from that. And this, this weird scenario. And so I, I do think that there's a, I think that, uh, that you're, you're potentially correct that the temperature on Twitter is high, but it is a very high stakes industry. I think it is appropriate that you will just kind of need to deal with this for a while.

1:18:21I would love some background on this idea of the implications of scores changing. I feel like that happened with 23andMe. I feel like that was the promise of 23andMe was that you do it and then as more data comes in, you can opt into extra studies. How did they solve that? Have you studied that business or any other previous DNA testing businesses to understand how to actually wrestle with that issue of the changing results over time as more data is created? So there's a couple of things to unpack there. The first is that you don't want to be a widget. okay fundamentally 23and is a widget they thought that with their data they could be able to actually eventually mine drugs uh which because of the limited nature of their data is actually not best for drug discovery um but on the whole genome front maybe you could maybe you could argue okay that you know that won't be a problem if ever a company wanted to do that but actually there's a meta point here about the genetics industry which is i think and this is you know coming from me which is i think that too often people focus on the genetic test it's not actually about the test, right?

1:19:31Usually people have a very specific acute problem they want to solve. In the IVF context, it's about, for example, having their best baby. So you'll see more and more patients are signing up for Nucleus to do IVF. And it's IVF that's full stack powered by our genetic stack. Because what's really unique about Nucleus as a business is because we've done the adult DNA testing, right, for many years now. And then now we also do the embryo analysis. So we can actually build a new kind of IVF experience called IVF Plus that is centered around giving parents as much information as possible into their embryos.

1:20:04And notice that shift there, John. You go from being a widget to actually trying to serve a process, a workflow that exists, and that if anyone who wants to have a baby has to undergo. One thing that Cremu was kind of hammering that I hope I don't botch was something about 12 SNPs versus a million SNPs. Previous data required a lot more genetic information. Nucleus was making the claim that you could get just as much signal from much less data. Is that right? What is your reaction to his take that it would be impossible for Nucleus to derive such a strong signal about the impact of genetic information from such a small data set?

1:20:53my response is the models are go are public go check them i mean the models are public i will say to be clear he also said that he tried to get access to the model and that he couldn't but but you're saying he's lying about that okay it's a complete a complete lie okay this is false so so it's incumbent by the way he proves that he that he applied or something like that i don't know i doubt he took screenshots of his i don't know i mean he wants yeah i mean also by the way we'll give the report we'll give the weights okay just go literally my nucleus.com slash labs yeah go on there it says origin open weight like open weight you know instead of all this debacle all this twitter nonsense the message to the scientific community the message to twitter is go check the weights and not just that our models are public okay yours are not make your models public and we can actually have a conversation then what about the allegations of uh of uh plagiarism copying from a different paper?

1:21:50When I looked at it, it didn't look like, you know, I'm not equipped to evaluate if it's a direct copy or not. Is it scientific best practice to stand on the shoulders of giants and pull from, you know, what the best researchers are doing, even if they're at your competitors or with something else more sinister going on or maybe a mistake? I think the thing to remember is like, you know, a lot of research, like if you think about like the AI context, right? It's like attention is all you need. They will use that paper. Yes, yes, yes. The transport paper has gone everywhere. It's the same thing.

1:22:24What are you going to say? A Google stole, like open AI stole it from Google? Yes. Come on. You're not going to say that because it's public research. And so it actually comes back to the fact that Nucleus is bringing this technology mainstream. Yes. Our campaign is succeeding in every metric. Sales are up. Signups are up. we have multiple articles covering the campaign people are starting a national conversation as we saw on twitter and i think people want to try to tear nucleus down because we have excellent science and science excellent science is the first step to building a very successful biotech business and this is what i think a lot of the armchair philosophers on twitter don't fully grasp which is in order to actually build a successful business you need to have each and every single one of these components, Sean.

1:23:08It's very easy for a scientist that's never actually built a business, that's never actually tried to sell to a normal person, right, to say, oh, the marketing is extreme. Oh, the marketing is over the top. Oh, the marketing is this. The marketing is helping a patient identify a genetic risk that they would unknowingly pass down to their child. There was a patient recently who they were doing IVF with nucleus and they identified that they actually had a gastric cancer marker, colorectal cancer marker, actually, excuse me. And that marker doesn't just impact their health, it also impacts their future child's health.

1:23:40So what did they do? They chose embryo without that specific genetic marker, and they took themselves precautions to make sure that they don't get cancer. And so that's what Nucleus is about, and we're going to keep serving patients. Yeah, makes a lot of sense. Sorry to everyone, we're having a little bit of trouble with the Stream, this has been a fascinating conversation. I like the gauntlet being thrown down on the next step here, actually being let's get the models in everyone's hands, because that seems to be a fundamental disagreement here. You're saying that you'll give them the model, give them the data.

1:24:20They're saying that they can't get it. Well, the next step out of this debate, I think that could silence a lot of the armchair philosophers. Do you care about rebuilding trust with the broader community on X? Yes, absolutely. That's why I came here. And then I guess what are the handful of things that you're committed to doing to make that happen? A lot of things. One is the AI thing. I think we should fix that, as mentioned. Make it more clear that it's AI images, that people want to be under HIPAA. That's one thing I think we should do. Another thing is that, and this is originally why we made the models actually public, is because we need to be more clear that people can go and actually test and check this stuff.

1:25:09In some sense, a company can do something, but if people aren't aware of it, that's also my responsibility as CEO. right and so part of the reasons why i'm saying hey the models are public come come submit to get to them is clearly there's an information gap there that for whatever reason wasn't filled in my nucleus and we have to do better and the last thing i think which is really important is sometimes you know on twitter this one personally hurt me um i the amount of time we've spent making the product in a way that people can try to understand where it shows the error bars, for example, where you can see that there's signal, but there's not a lot of signal.

1:25:50Or in some cases, there might be a lot of signal with something like height, right? The amount of time and effort and product design and science and sort of like scientific communication specifically. It's been years. Nuclea's been around for six years. I've done this for years trying to get that right. When you see the embryo on your smartphone, it's easy to look at that and just write it off, right? I encourage everyone to go on pickyourbaby.com, go to them in the flow, click around, look at our disclosures, look at the way we present information, right? It really is, it takes a lot of time.

1:26:25It takes a lot of effort, right? And I think that is something that I'm thinking about. How can we better put the product out there? because I think when people can't see something, when they can't see the product or they can't see the science, then they start ruminating. So that's what I really, really want to do and how do we better kind of connect? And also, honestly, I think I need to be also more mindful. I mean, clearly, I've inadvertently, I've pissed some people off and that's understandable. That feedback's taken in. Okay, I'll be more mindful because I really, really, really, really, nothing is more important to me than a patient coming to Nucleus getting the highest quality care in every sense.

1:27:03Yeah. Well, thank you for taking the time to talk to us. Thank you for taking the time to break all of this down. We are fighting through some technical issues completely unrelated to what's going on. Somebody didn't want this interview to happen. Somebody didn't want this interview to happen. I don't know. But we really appreciate you taking the time to hop on and set the record straight, give your side of the story and explain what you think folks are getting wrong on the various issues here. It's an incredibly detailed and incredibly important discussion. And we really thank you for taking the time to talk to us.

1:27:38Thank you, John. Thank you, Jordan. Have a great rest of your day. We'll talk to you soon. Let's go back to the timeline. We do have more guests. If you are tuning in because of that debate, the chat is active, but we don't know the status of the stream. The chat is saying that the stock is crashing because, of course, we're having stream issues. I don't necessarily think we got to put this on us. There's all sorts of independent state actors that have attacked us in the past. We've had major outages from the hyperscalers. NVIDIA put out a statement saying that they're not Enron, but that doesn't mean that they're not somehow responsible for our stream lagging in quality.

1:28:25Who knows? You have no idea what's going on, why our stream is having issues. All I know is that it's not our fault. That's for sure. There's definitely nothing that we did. Armu says, Kian is now dodging the question about the Mendelian disease. He flagged for a patient and then revised on it. This is illegal without notifying the patient. He's saying it's just a model update. This is not something you update on. Medallions are definite. You have it or you do not. Yes. Interesting. Well, we have Joe Weisenthal from Bloomberg joining. I'm very excited to get an update from him. Oh, he's here. Welcome to the stream.

1:29:06Thanks for having me. It's been too long. It has been too long. We're sort of fighting for our life on the stream, but the conversation between us should be fine. We had a very dramatic debate in the bio context. I don't know if any of this bubbled up to you, but this anonymous poster, Cremieux, is alleging that this company, Nucleus, You might have seen some subway ads. Have a healthier baby. Have a taller baby. Oh, I've seen these ads. Have you seen these? I don't know if I've seen the ads. I've seen the photos of the ads, and I know that they're the subway stops that I sometimes go to, but I actually don't know if I've seen the ads.

1:29:43I'm going to look for one tomorrow morning. I'm going to go to the stop that I've seen those photos. I'll take my own. I'll verify my own photo. We were joking about this, that there's something about New York subway advertising that's like uniquely viral. And every company, no matter where they're based, just wants to. They see New York only as a place to run out of home and then go viral. Because this has happened a number of times. Friend.com, I'm sure. Did you actually see the Friend.com campaign in person? I definitely saw it. And without, every single one was vandalized, period. There was not a single exception.

1:30:15Really? That's true? Every single one? A hundred percent. A hundred percent of the ones that I saw were vandalized. That's hilarious. Zero exceptions. And they were all over the place. They were all over LA. There was one that, it's right on the drive from the gym to our office, to our studio. But it's hilarious because it's a billboard that's directly up against a wall. So you can't see the full ad. You just see end.com. And it just is very ominous. Like this is the end. And it's clear because the, the buy was so broad that they didn't think that, Oh yeah, that one's actually not valuable at all.

1:30:48I love that. I love that. They literally, they just spammed real life. That's what happened. Totally. they spammed the physical world. And it was getting worse and worse. Uh, they were, they were spamming Los Angeles. Then I live in a suburb of Los Angeles, Pasadena. And then one day I'm driving around my hometown, which is very quaint and sort of out of the loop. It's not, it's not the San Francisco hubbub. It's not teapot. It's, it's Pasadena. It's a very chill suburb. And I see a friend.com ad billboard. And I'm like, I can't believe you followed me here. It's following me everywhere. It follows me on the internet, follows me to LA, follows me to Pasadena.

1:31:20I can't get away from it. It's like clicking on an ad, you know, it's like, or something. And then you just get, you know, served that same ad over and over again, except this one is real life. I do wonder if the, if the rage bait, if the, if these like, because there's these small campaigns from these like tech startups that are in one way, you know, I, I, I criticize. them. We criticize them here on the show. But, you know, I think that in some ways, these are just, you know, pranksters on the internet. These are young entrepreneurs figuring out how to get attention. I'm somewhat sympathetic.

1:31:49But at the same time, I do see that there are people that make political decisions based on this stuff. Have you been following like the tech lash and all of this, like the data center news? I've heard. Yeah, absolutely. I've heard of it. I've heard that there's a bit of a backlash brewing. Yes. How real do you think it is? And do Do you think it's going to be more power-driven or water-driven? I think it's going to be very real. I actually think it's going to be very – yeah, it could be all of those. I think it's very real. I mean I really wonder who is – even in the 2028 or even 2026, who is going to run on anything that actually is like, oh, no, actually data centers are good.

1:32:31AI is an important industry of the future. you know actually the power stuff has been overstated the water stuff has been dramatically overstated I have a hard time seeing any politician actually running on that case it seems like anyone democrat or republican it feels like they almost have to be automatically against data centers for some reason and I think you're right like I think that there's um people have some intuition they don't like AI companies they don't like big tech whatever and then they fill in whatever seems satisfying. So I don't know. I think the water stuff seems like the most out there and disconnected from reality.

1:33:08And so therefore, the people who are most disconnected from reality will probably latch on to the water stuff. The people who are a little more sort of, I don't know, normie in their views about how the economy will maybe talk about the electricity. And then people who just dislike the sort of broader effect of tech and all these different things, they're probably going to talk about the slop and how it's ruining society, which maybe it is. I'm not really sure. But it does feel like there is something, to your point, there's something for literally everyone to latch onto in the anti-AI fight. Anyone can have their thing which resonates with them, in which case it's like hard to see where the constituency is to build these things.

1:33:47So I think what you end up is probably a lot of entities, you know, looking for places in the middle of nowhere in Texas where they can set up their own natural gas plant and their own gas turbines or something and, you know, stay off the grid as long as they can. We got to get a politician who's just like, you know what? Like, this stuff's delightful. Have you seen the Studio Ghibli? I like the Studio Ghibli. I like a Suno song. Yeah. Someone will, like, who is it? Like, just even when you say that, though, like, it's hard to imagine who that politician is or what the case that they make. Like, you know, so few people write today.

1:34:23I mean, I use some AI tool basically every day to look up something. Who speaks for us? Who speaks for the constituents that do one deep research report every couple days? And they use the thinking models to answer some questions every once in a while. And they generate some funny images every once in a while. And then they kind of move on. And then they come back to it in a little bit. And then it's like, oh, they have a new thing out. I'll run my battery of tests that I do with every new model, the questions that I always ask. It's pretty good. Yeah, yeah, pretty good. No, I think it's going to be really tricky politically.

1:35:00And I really think it will be huge because just to – the labor market is soft. So here is this – and electricity prices are high. And granted, we don't know what the conditions are going to be in 2026 or 2028. But right now you have people who are in the AI industry, obviously many of them in fact, talking about the potential for AI to display significant amounts of labor. Who's going to vote for that? Like, how is that? Again, I could envision some world in which human life is a lot better when we've been freed from many laborious tasks. Totally. But in today or tomorrow or 2026, it's hard to see, like, what is the thing that gets people excited and ass about it?

1:35:40Yeah, I mean, pre-internet, it would have been a lot easier for Silicon Valley to navigate this technological cycle because you could have been going to the capital markets and saying, well, you actually want to give me$100 billion because I'm going to deplace millions of jobs and all these categories, and we're going to capture some percentage of that. And then you could go to the everyday people, you could go to the media and say, we're going to create super abundance for everyone, and there won't be any jobs, and you're going to have an army of robots that run your whole life and it's going to be this beautiful utopia.

1:36:23And now people go on one podcast and they want to talk about job displacement and they go on another podcast and they talk about utopia and the same people end up seeing both of them and it just doesn't work. I couldn't agree with you anymore on this specific point. No, for real. I think this is like one of the defining phenomenons of our time, which is that there is no such thing as segmenting audience. And this is a phenomenon that occurs across all sorts of different realms, whether we're talking about politics or Wall Street, et cetera. Historically, people talk differently to different groups, and that's just very normal, et cetera.

1:36:58And you tell one story to someone. If you can't do that anymore at all, everything in any context is implicitly understood, including internal company communications, right? Where we expect everything to leak, and you expect someone to any memo that you share. So internal communications can't really have any candor anymore because that all reads as PR because that's expected to lead. Yeah, and every single person running a lab has had something where six years ago they were on a mic saying confidently, it's very likely that AI will kill all of us on a long enough time horizon. And then that resurfaces today.

1:37:34Or even worse, they'll say like one of my worst nightmares is that this happens and that's why I'm working to stop that scenario. And then people just remember. That's why I wanted to build it. Yeah, but this is a weird thing about AI specifically too, which is that we're sort of at this point where several technologies that maybe we were really excited about at some point in the past, years down the line, like, oh, we didn't really think, or this turned out to be not so great, or we don't really love the effect that this is having on society and so forth. AI seems very strange and distinct from anything else I can think of in memory, where from day one, even before it really existed, The people invested in it and sort of working on it have talked about its downsides in frequently dramatic terms such as you're describing.

1:38:18So it's very different than any other technology where usually the downsides only become apparent years and years after they've sort of suffused and soaked into society. Here they're talked about from day one. Okay. Last week there were two headlines that I was trying to turn into some sort of pithy phrase or headline. I couldn't really land it, but I'd love your feedback. So NVIDIA beat earnings and we got a jobs beat. And so I was riffing. I was like, demand for robots and humans through the roof? Yeah, that's right. Is that what's going on? Or am I misunderstanding the jobs numbers? Was that less impressive than people thought?

1:38:54The October jobs report is canceled. Yeah. And the GDP. So, yeah, I'll say a few things. I mean, that jobs report is from September. It feels like a lifetime ago. You know, the other thing, too, is that although it did – the pace of job creation for September did come in higher than expected, once again, job creation was actually negative if you include healthcare and social care work, which is a thing that I think I've talked about a couple of times when I've caught up with you guys. But those are the jobs that we would really like to see AI liberate us from, right? Like it would be really nice if you could actually have robots change the bedpans of seniors or other these things that are sort of low productivity jobs, jobs that for many people are low paid, kind of miserable in many cases, et cetera.

1:39:41So I think what's going on, unfortunately, is that we're in this environment in which job creation overall for most sectors is pretty mediocre, including finance, including tech, et cetera. The one thing that keeps powering us forward are these sort of menial, low-paid jobs in health care, service sector, taking care of seniors, et cetera. And I don't know. It feels like we're very long, very long until anything AI robot related is actually getting into that sector. But that would be the dream, right? I mean, that would be the dream to make progress in that front. I mean, Eldercare was the original pitch of Honda Asimo back in like 2000 or 1999.

1:40:23It was like, yeah, this robot's going to bring the meal to the old person in the sick bed. Wouldn't that be amazing? Makes a ton of sense. And to be fair, there are some robotic with wheels on it, rolls around, does some stuff. No, for sure. But certainly not broad deployments by any means. Yeah, not broad deployment, not at the scale. And so what happens is we have this economy where the unemployment rate is still pretty low by historical standards, although it's gone up a fair amount a little bit in the last year. But there's just so much pressure being put on the existing labor force to care for the aging population.

1:40:59It creates some pretty serious strains. Yeah. How have you been tracking just the AI spending bubble, this idea of massive growth debt coming into tech for the first time in a long time? I feel like a lot of tech people are so used to the venture capital model. Okay, yeah, it might be$100 million at risk, but this is 1 % of overall allocation. There's a bunch of LPs from foundations. It's very diversified. And if that company goes bust, that's fine because another company is going to do great. Now we're looking at serious numbers. We're getting into trillions. There's debt involved. People don't know how to manage with debt and deal with that.

1:41:37How are you processing it? It was sort of a real wake-up call to me when I started seeing people online post screenshots of credit default swaps on Oracle debt. Like that was the moment where I was like, oh, this really has transformed from this sort of equity-funded, free cash flow-funded environment, which has characterized tech for over two decades, really going back to – until the telecom bubble. So as soon as you – and I know these companies have debt. I mean you see them. Apple has debt. They've had it for a long time. A lot of these debt issuance, though, in recent years have been more or less like exercises in cash flow management or optimizing taxes and stuff like that.

1:42:16Now it feels like, OK, like this debt is at a very real scale where I'm looking at CoreWeave credit default swaps, Oracle credit default swaps, et cetera. That is, to my mind, a signal of, of course, something changing. Blue Owl, they're publicly traded. That's the private credit company that's gone in with Meta to do some data center financing. That stock, I think, has become a bit of a proxy for how people perceive some of the financing risk in that space. The deal that we have an episode coming out, I think, sometime next week, actually, where we talk a little bit about how the credit construction of these events.

1:42:58The founder of this company, Noetica, which uses AI to examine credit agreements, actually, walked us through it. It's some fascinating stuff, but people are sort of looking at, okay, who is the real bag holder here? What is the risk of, you know, people are talking about, obviously, what is the risk if there is not as much value in these GPUs five years from now as we may have thought? And to your point, that's just totally novel for tech in recent years. It doesn't feel like we've – it's been so long since the idea of debt or leverage in that way has been part of the tech story. Yeah. What did you make of NVIDIA sending out that report for the sell side over the weekend?

1:43:40And then again, they had another post. They had another post today. I'll just read it in case anyone is just tuning in this morning. Let's see. We covered it at the beginning of the show. So we're delighted by Google's success. They've made some great advances in AI, and we continue to supply to Google. NVIDIA is a generation ahead of the industry. It's the only platform that runs every AI model and does it everywhere computing is done. NVIDIA offers greater performance, versatility, fungibility than ASICs, which are designed for specific AI frameworks or functions. So, again, these are meant to be confidence-inspiring, but they have the opposite effect.

1:44:22it's really weird the tweet like i guess i sort of understood okay so they sent out that note you know look as i mentioned um over the last several weeks for some reason wall street has got really taken in with this whole conversation about gpu depreciation schedules maybe i think michael burry's been talking about it or something okay fine like this has taken hold i am sure this is the the type of thing where for every 100 people who are talking about this maybe knows what they're actually talking about. Like, I have no doubt that there's all kinds of noise out there. And so maybe it makes sense for NVIDIA to like, oh, let's put out some information that we have.

1:45:00Like, I guess it's a little weird, but okay. Like, I sort of get it given the degree to which this has just become a meme in the last few weeks. The tweet about Google is a little strange. Like, I typically... Here's the biggest, most powerful company in the entire world, and they're doing this sort of weird. We're excited to see. We're happy for your success. It reminded me of Jensen's comment on the OpenAI AMD deal where it was like minus snarky. He was saying something like, I'm kind of surprised they're so excited about their new chip. I'm surprised they would give away 10 % of their company before they've even developed it.

1:45:42So, again, to me, I feel like when you're operating from a position of strength and confidence, you never talk about competitors from official channels. In fact, I've given this advice very recently where, like, there's a company that every time their competitor does something, they post about it. Guess the revenue difference. Quote tweet, too. It's so much easier to just be like our esteemed, the other members of our industry, or like the other big tech companies would do it this way, or like other handset makers or other smartphone makers. And everyone knows that you're talking about Google or iPhone or whatever you're comparing to, but you dress it up.

1:46:27In this case, the company that they always talk about has 100 times their revenue. And so it screams like we're obsessed with our competitor. But in this case, it's like the TPU is just like the first sign of an external. Yeah. And you immediately like pounce on them and you're like, you know, I've been thinking, I mean, one of the funny things about Jensen and NVIDIA overall is you think about these other mega cap tech companies and these other ultra rich CEOs. You know, they've been dominant for in most of these cases for like well over a decade. right now they've been some of the most powerful companies in the entire world for over a decade obviously nvidia is sort of this weird case because you know four years ago people were talking about oh this is the company that makes chips for ethereum mining or this is like that was what how a lot of people talked about nvidia i think even as yeah as recently as 2021 people were talking about oh nvidia's so it might well people don't remember uh before there was the mag there was fang and there was an n right and fang and that was and what was it was netflix it was not nvidia it was facebook amazon apple netflix google yeah and then crazy to not include microsoft right right and they so they added microsoft and they took out netflix and then they added nvidia and tesla of course um but yeah well i mean what what a what a wild like it's a weird like what a run i mean obviously like nvidia has been an incredibly successful company but it went from like a pretty successful chip company to the biggest company in the world in a matter of a few years, maybe there's something there.

1:48:07Maybe there's still a chip on the shoulder. Maybe there's still some culture of feeling like it's the underdog and something where it's like, yeah, it's like, act like you've been here. Yeah, it's one thing. So the tenure thing is real. So here's the thing. If you're a startup and Google enters your market, I've seen a lot of founder or like a big company, if you get Sherlocked by Apple, you're going to hit the timeline and be like, I'm delighted by Apple's new mobile app. We're delighted to continue serving. Yeah, they validated the market. Thank you, Apple, for validating our industry. Yeah, yeah, yeah.

1:48:43But I don't think NVIDIA doesn't exactly need validation at this point from a competitor. And the TPU is a decade old, by the way. Right, it's been around for a while. Right. And like that, which is another sort of interesting dimension of all of this, which is like suddenly people wake up and, oh, it's not like to your point. I mean, people have been talking about the existence of Google's TPUs for a long time, obviously. Now, there's been some question about the degree. What's the strategy here? Would they ever sell them? Will they rent them out? There have been obviously questions, et cetera.

1:49:16But it is funny how you get these moments where suddenly you get this 180 over the last several months, weeks on Google, the Gemini 3 launch, of course, bolstering this idea. Oh, actually, they're in a good space. And suddenly, oh, and they also have these TPUs, which they've had and been working on for a long time, but nothing really changed. They've had them for a while. There's not some new breakthrough announcement here or something. And so suddenly NVIDIA feeling like it has to respond, a little strange. Yeah, yeah. I mean, I do think that there's so much demand that it's a little bit ridiculous to just be like, oh, NVIDIA is completely over.

1:49:53But at the same time, it's never great when you go from a monopoly to a duopoly. Like it's just – it's always nice to be in a less competitive market. Yeah, but at the same time, it's like if AI is literally half as transformative as the AI bulls thing, it doesn't matter. Like you can have two players and the demand is so overwhelming. And like NVIDIA's own sales are capped, right, by capacity and by production capacity. There's only so much, which is another sort of like interesting dimension that I'm like trying to get a better understanding of here, which is that, you know, again, it's not like search or AI or chatbots, et cetera.

1:50:37There are these constraining effects on the markets from how much fab capacity is at TSMC or some of this underlying equipment. So the ability of anyone to scale up dramatically and expand the overall size of the market is sort of tough at this point. I don't know exactly what that means. But my guess is my assumption would be that everyone remains pretty capacity constrained for some time. I don't think there's like tons of chips laying out there for the taking right now. Yeah. Give us an update on odd lots. People have been congratulating you on 10 years. Did the 10-year date happen recently?

1:51:19The 10-year date did happen. You know what's funny? I think it was November 6th. I got an email. November 6th. So we have a party, which you both are invited to. We have a party in New York City in December to celebrate our 10 years. So we've been sort of, that's right. Why did you play the night vision sound? That's right. Fire me up. But so we were getting ready for that. We've been doing some sort of 10-year episodes. We're talking to some big names and big, big picture thinkers and stuff like that. But I didn't realize the actual date until the morning of, I started getting random emails from people inside the company congratulating me, congratulating us on 10 years.

1:51:59But it's pretty crazy. Let's hit the gong 10 times. Yeah. 10 times. Wow. 10 times gong.

1:52:09Thank you. There we go. This has been the highlight, the 10 gong smashes. This has been the highlight so far of our 10-year anniversary. Who's the most recent 10-year guest that exemplified that bigger picture thinker? Yeah. Well, we had Ray Dalio on the podcast on Monday, which was a lot of fun. He told us about meditation. He talked to us about the importance of transparent culture, about the importance of letting junior staffers or junior employees at Bridgewater attack the senior employees. I loved his story about the first stock he ever bought. I know, I know. Hilarious. I don't know if he tells that constantly.

1:52:49I haven't listened to every possible. He probably does. He probably does, yeah. But it's such a good story. He's just like, I saw it, and it was the cheapest stock he could possibly buy. It was the cheapest nominal stock. It was like$5 a share. Yeah. He's retail. I think he made a lot of money. It's a retail army. I mean, it's like in crypto when they're like, it's 0, 0, 0, 0, 0, 1 cent a token. Imagine if it's a dollar, and you'll be like, I have so much money. Can we talk about that for a second? It's really annoying with some of these crypto prices to have to like squint and see how many zeros there are.

1:53:19They need some reverse splits, I really think. Like we need to go – we need to like$1,$2. But no, to your point, right? It's basically for – I don't want to be insulting, but it's basically like the dumbest. It's trying to attract the dumbest kind of trader there is when you're like, oh, this is cheap because it's one millionth of a cent or whatever. You're still early. Yeah, I mean – You're still early. Imagine if this were$1. I remember the Doge to a Dollar campaign. Everyone Doge to a Dollar. That was a very powerful meme. It was very powerful. How was it? These things are real. I thought it was going to get there because I think it got to like 30-something cents.

1:53:53So I was like, oh, it's definitely going to satisfy the meme. It never made it there. You're like, I thought it was going to get there because I put my whole paycheck in it. I really thought it was – I was like, oh, it's obviously going to go to a dollar. It did seem like the meme was going to work. It got close. It got close, yeah. It was on run. Jordy? Are you aware of a single person that has sold their primary residence in New York and is going elsewhere since the election? What's been the sentiment? I know a bunch of former On Lots guests are on the transition team. Which is cool because you guys have some insight into how these people think and the public does.

1:54:33Yeah. I have not heard of anyone who is leaving New York City. It's interesting. I don't know the name of the brokerage, but there is one of the brokers in New York runs these ads, speaking of outdoor ads, in the taxis. And prior to the election, they were very scaremongery and they were like talking about deals in Florida and all this like real estate you could buy in Florida, etc. Anyway, after the election, I saw one of the ads this week and it was talking about how J.P. Morgan just opened up its new headquarters in New York City and how many employees they're going to have there. So I guess now that the election is over, they can go back to selling New York City real estate because they didn't get the – I don't think they got the – those brokers did not get the outcome that they were hoping for.

1:55:20But yeah, we have some past guests in the transition team. Paul Williams, shout out to him, who I also play music with in my country music band, Light Sweet Crude. He's on the housing transition. Kathy Wilde, who is the head of the partnership for New York City, which is the big organization of a bunch of CEOs, et cetera. That's like the most like sort of like dyed on the wool, like sort of, you know, they're not a lobbyist group, but they represent the business community. Even she is in the transition team. She's also been on the podcast. So it seems like, you know, I've seen a bunch of people angry at some of the picks, happy about some of the other picks.

1:55:56it seems like he has built a um he's uh at least with these selections a little something for everyone some moderate some normies some more radicals etc enough for like everyone to be a little happy and a little a little concerned maybe yeah yeah i mean it certainly seemed like that there was that viral clip of him with uh trump that was very funny where they're kind of going oh that was crazy yeah it felt like there was just like okay there's a lot of theater on both sides here they're both they're all having fun uh you know they're not like i can't even be in the same room as that person no so you know i think that like for those of us not in politics i don't know it's like hard for us to imagine how these people who are like the way the rhetoric and then they like get together and they smile in front of the camera and like feels very weird but you know they're just like they're professionals i mean nfl teams have rivalries they shake hands at the end of the game i think that's kind of the nature of these things which is wwe yeah wwe i've always liked the the wrestling metaphor uh the um the thing is too is that like whether we're talking about the selections of people for the transition or the i think very wise choice by uh mom donna to like try to be friendly with the white house or at least find some common ground is look there's some like pretty hard budget constraints etc and it the mayor the job of mayor is a management job um you know the trains aren't going to run themselves the buses aren't going to run themselves.

1:57:19The apartments aren't going to get billed. So there's a certain amount of like required between the budget constraints and just everything else. I think there is a certain amount of sort of forced pragmatism that's probably at play here. Yeah, that makes sense. We'll let you go in just a minute. What's next on the economic calendar that you're tracking? What should we be looking forward to through the end of the year? Obviously in our world, we're very excited about Black Friday. We're going to be tracking those numbers. Also an interesting economic indicator, but what's on the top of your mind?

1:57:51You know, I think actually, like, basically all data through the end of the year is going to kind of be garbage, because obviously we're going to get the restart of the data, and we'll get more timely jobs data and so forth, but all of that is going to be affected by the shutdown. October, we're not getting anything from October. Yeah, we're not getting anything from October, and then November is going to be affected in large part from the shutdown, so those numbers aren't going to mean anything anyway, And so probably the actually clean report where we could say, OK, this is actually well-collected data to the extent I need data is there's all kinds of issues with collection and is not affected by the shutdown.

1:58:27So that's going to come out in January about December, which is going to be very strange. You know, I think the big development is so I think it's December 10th is the next Fed meeting. As recently as a week ago, it was looking like they were not going to cut. The odds were below 50 percent. But a number of the FOMC members in the last several days have come out and said they're cool with the cut. So it looks like as of right now, we're going to get a cut. But that is I think that meeting is the day before we get the November jobs data. So it's all going to be sort of a mess, I would say, until early next year.

1:59:00Last question. How should people read into not getting data from the month of October? Should we say that the simplest explanation is employees were furloughed? We don't have time to go back and collect all the information? I think my impulse is that the simple explanation is the correct one, that due to the timing of the shutdown, the duration of the shutdown, it's unrealistic or something like that, as opposed to something nefarious. If there continue to be more things, then okay, then we see what's up. But I would say this is probably pretty straightforwardly linked to the fact that the government was shut down.

1:59:44I'm also going to tell you about Fin.ai, AI that handles your customer support, the number one AI agent for customer service. Our next guest is Director Michael Kratios. He is the 13th Director of the White House Office of Science and Technology Policy. And it is great to have him here with us. on the show today. One of the best call-in setups we've seen. You look fantastic. Thank you so much for taking the time to talk to us. How are you doing? I am great. Thank you guys so much for having me. I have followed your meteoric rise over the last year. I feel like I should have been on this show much earlier.

2:00:19Yeah, we would have loved to have you, but we're very happy to have you today because there's massive news, but I'd love for you to introduce it and actually set up the conversation. So please take us through the announcement and then I'm sure we'll have a ton of conversation and questions to go through. Yeah, so I think maybe we can start with the AI action plan that the president signed out in July of last year. And one of the main themes of the AI Action Plan, essentially to win the AI race, is all about how we can win in scientific discovery. And the question was, how do we do that? What's the next chapter of using AI to drive scientific innovation in our country?

2:00:57And yesterday, the president signed an executive order launching what is known as the Genesis Mission. And I think for a lot of folks that you guys talk to every day, you know this. AI has had this incredible rise over the last couple of years. it ultimately started first with large language models themselves. And those were where we scraped the totality of knowledge on the internet and were able to then create these models that can predict all sorts of things, the next word, if you will. The next phase of it was all around coding. And you've seen these great startups that are incredible at coding.

2:01:28Some are huge model builders are awesome at coding too. But the big question that still remains is, how do you apply this large language technology to scientific endeavors? How do you use it to be able to create new materials? How do you use it to create new microprocessors? How do you use it and tap it into all of this exquisite scientific technology and hardware that exists all around the world? And what the Genesis mission tries to do is to bring all of the super valuable, important data that the national labs have collected over the last 70 years and put it to use to train large language models to be able to dramatically, and I mean dramatically accelerate the pace of scientific discovery.

2:02:08So this is, I would argue, and I've said it before, and I'll keep saying it, this is going to be the single largest marshalling of the federal resources of scientific discovery since the Apollo program. So we're thrilled to kick it off, and DOE is going to be the home for it. Talk to me about the relationship between the public sector and the private sector. I feel like a lot of folks in our audience have said, thank you for your service. We loved DARPA. We loved when DARPA created the internet. We loved GPS. We loved the moon mission. but we got it from here. We invented the transformer at Google.

2:02:40We invented SpaceX and the rockets that go up and land. And we think private industry has it handled from here on the research side. We don't need anything from the government. How do you think about, is that just, is this just a misconception and we actually need more original new ideas, research in a government setting, or is there more of a public private partnership that you think will play out here? I think it's definitely more of the latter. I mean, the reality is that when some of the initial projects were launched in the 1950s, you think of the Manhattan Project, that was an era where the vast majority of research and development in the United States was paid for and funded by the federal government to the tune of almost 70 or 80 percent of it was funded by the federal government.

2:03:23If you zoom ahead sort of the 70 years that we are where we are today, the vast majority is done by the private sector. You know, generally, the United States spends about a trillion a year on R &D, and about 80 % of it today is done by the private sector. Now, that being said, there is a critically important role for the government to play in that larger ecosystem, and it truly is an ecosystem. You have to have private sector, academia, and the federal government all working hand-in-hand to sort of make the very important basic research breakthroughs and ultimately commercialize those. And the secret and the sort of unique special thing about the Genesis mission is the scientific data sets that exist at the national labs.

2:04:04This is a unique asset that is so valuable to the American people and to all of the scientific enterprise in the United States. And the bottleneck, as you guys know so well in so many of these AI endeavors, is how do you get the right data to train these models? And for the early large language models, the data was just out on the internet. You could use Common Crawl and Scrape It. For the world of coding, you had lots and lots of coders and lots and lots of material you could use to train those coding models. But for science, it's not that easy. You have silo data. You have pharmaceutical companies that have pharmaceutical-related data.

2:04:35You may have chemical companies that have chemical-related data. But what's so special about our national lab ecosystem is that it covers such a diverse and broad range of scientific endeavors. You have biologists. You have material scientists. You have chemists. You have people who are working on space all in the same national lab infrastructure. and that depth of data is so incredibly powerful in order to accelerate scientific opportunity and endeavor. And kind of that's what the Genesis mission is all about. And to your point about private sector involvement, the thing that we have been so excited about is the private sector is clamoring to be part of Genesis mission.

2:05:08We all are in this together. There's a desire to pair the incredible supercomputing infrastructure and the GPU capacity of our greatest chip companies with the great data sets we have at DOE and everything in between. Yeah. Yeah. Can you help me understand a little bit more how a lab might actually plug into the Genesis mission? Because we've seen a lot of the labs say, oh, we want to start working on science. Some of the labs have already. I mean, Google has a Nobel Prize, right, for AlphaFold. Does that look like them interfacing directly with the DOE or going through a lab? Or how does that take shape, do you think?

2:05:47So what DOE's ultimately, the Department of Energy is going to be creating is a platform for scientific discovery. And there we're going to be making available the very valuable scientific data sets that can be used to run these large language models for science. And as we've seen, OpenAI had a nice tweet thread about sort of this project and how excited they are about it. We've seen lots of other companies already pursue this. Google, of course, with AlphaFold and the Nobel Prize that they've won there. So what we're seeing is all of these large language model builders or labs themselves want to partner with the Department of Energy so we can work hand in glove to accelerate the scientific discovery.

2:06:26The key is how do we just zoom out a second and think about how do we 2x the ability of us to very quickly iterate on scientific experimentation? So right now, if you have a hypothesis and you want to test it, how do we make that 2 or even 10x faster? How can we make it so that if we have an idea, we can send that idea to an AI-powered cloud lab and the test can be run behind the scenes as we're working on a second project? So that's this sort of like big level thinking that we want to do to dramatically, dramatically accelerate the velocity and pace of scientific discovery. Can you help me understand how you think the United States is positioned geopolitically against our near peer rivals on the issue of AI in science?

2:07:08I feel like I'm relatively up to speed on just the general capabilities of American image models versus maybe Chinese image models or DeepSeq versus GPT-OSS and the LAMA models. I kind of know where we're standing in just the general industry, the industrial uses or the general uses of these LLMs and the AI models that are coming out of America and China. How are you thinking about America's competitiveness on the science and research side? So we're in a lot earlier innings of that. That's a really good question. And I think what's unique about sort of AI for science is it has to pair this exquisite scientific physical infrastructure with the models themselves.

2:07:52So if you want to drive scientific discovery, you have to be able to pair what's coming off of telescopes, what's coming off of lasers, and all this stuff to be able to match them with large language models to be able to accelerate that loop. And we're still in the very early innings of it. And in order for us to sort of outpace and continue to keep our lead like we do have in some of these other places is we have to do something like the Genesis mission. We have to wake up a country and say, look, where do we have the most valuable scientific data sets? And how do we make those data sets available to our model builders to be able to create the necessary tools to pair the data coming off these scientific instruments back into these AI models?

2:08:32And think about it. For us, we want to win on fusion, for example. So for fusion, Google's already doing this, but there's a ton of companies around the United States that are very heavily funded that all have lots and lots of experimentation they want to do with these fusion reactors. The ability for us to be able to accelerate the modeling of that through the Genesis mission, rather than each individual company having to do this on its own, can be really, really dramatic. So back from a pacing standpoint, I think the U.S. has all of these amazing instruments. It has the labs. It has the great private sector together.

2:09:02And what the Genes mission tries to do is bring that together in a way that's truly American, where each of us, as part of the ecosystem, can play the important role that we're best at with obvious sort of commercial goals in mind down the road. And that's what's sort of driven this great discovery we've had for years. And I think we're going to continue to see that in the years ahead. What role does academia play as part of this project, in your view? So I think for us, academia has always played a very important role in pursuing early stage, basic, pre-competitive R &B. As we think of all of the most critical areas of scientific endeavor, whether it be in materials or in chemistry or in mathematics or in physics or science, there is still a critically important role in that early stage discovery science.

2:09:50And academia can play a very important role there. They're the ones that have these theses and these ideas and these hypotheses to solve some of these very early fundamental problems that can ultimately unlock great commercialized solutions in the years ahead. So academia and universities are and do want to be part of the Genesis mission. There's an important role for a lot of these departments, professors, and thought leaders to be part of it and to introduce their ideas and concepts of things that they want to test. What ultimately Genesis is going to do, it's going to create up to 20 grand challenges on some of the biggest scientific problems we face today.

2:10:23And we're looking for everyone. You can be in academia. You can be in the private sector. You can be in your garage, wherever you are. We want you to come with the best idea on how to solve those and be able to leverage the great infrastructure that the federal government has at its labs to solve those. How are you thinking about AI risk these days? I feel like we've been on a total roller coaster from sci-fi paper clipping scenarios to some very real geopolitical competition and issues with people maybe using these models too much, going somewhat crazy. There's been a wild ride that I think everyone's been on.

2:11:00And I'm interested to hear how you think about AI safety these days. Is the nuclear analogy the most important? Is this a Manhattan Project? How do you think about the role that the U.S. government should play in the AI safety discussion? Yeah, you know, I think as I kind of look back and think about how the early conversations were when some of the big model lab builders came to Capitol Hill and talked about wanting to create kind of an IAEA for AI, I think honestly it set the wrong tone. And I think it set sort of the industry back for a while. And I don't know how much you guys track sort of like global politics of AI policy.

2:11:40But for a good two years there, I think that sort of discussion on the global stage was, you know, what are the worst possible things that AI could possibly do for the world? And let's try to like figure out if we as a collective, you know, world can find some sort of like global solution to solving it. And obviously that's kind of the wrong approach. And everyone's backed away from it. The UK themselves that were kind of touting their big UK safety institute have renamed it the security institute. We as the Trump administration renamed the AI safety institute or department of commerce as well and kind of moved in a direction of innovation and adoption versus sort of this nebulous catch-all safety term.

2:12:23But I think to me, one thing I always think about and we always have to balance is, and maybe it's a little personal, but to me, I recently became a father in July. And I think a lot about the way that my child is going to grow up, the way that he is going to interact with this particular technology, the way it's going to impact not only the way that he grows and learns in school, but also the types of jobs that he's going to have and how he's going to enter the workforce. And I think there are very credible and real things that the American people are thinking about, about how this technology can be best used to improve their way of life and ultimately help them live a better and more fulfilled and more rich life.

2:12:57And we at the White House are all about finding ways to encourage adoption of this technology. And in order for that to happen, we have to have the trust of the American people. And trust is part and parcel of everything we're trying to do, whether we're building out AI for educational reasons or to improve the amount of energy that we have in the United States or solve the biggest health crisis that we may encounter in the future. we want to build that trust. So when these solutions are coming about because of AI, it's embraced. And it's something we worry about and think about a lot. And it's something that a lot of our standards agencies are thinking about.

2:13:32How do you promulgate the right standards so that when these technologies are put into all these different industries, people trust them? How are you thinking about job displacement at this point? The models are so incredible. They're smarter than me at everything. And yet I haven't actually been able to drop them in as a co-worker right next to me. Every day we try to replace Tyler. We say, Tyler, replace yourself. He's just too good. But there's still, there's still like an ambient level of anxiety that something's coming. And so I feel like you need, you do need to be prepared. You can't write it off entirely, but I'd be interested to hear about how you're thinking about, uh, the goals that you could even set around, uh, transitioning people through jobs, how you think about the AI job relationship.

2:14:19there's a couple of things i first the first thing is about ai education we have to prepare the future american worker to be able to fully leverage this technology when they enter the workforce the president signed executive order in april of this year where he prioritized k-12 ai education the first lady has gotten very excited about this endeavor we're running something called the ai presidential challenge which is a challenge that we're rolling out across the entire country where we have students from all 50 states participating in it. And ultimately, it's going to culminate in a sort of competition here at the White House at the end of the school year where we can show kind of how students are using AI to solve some of the biggest challenges they face in their local community.

2:15:00It's like the presidential fitness. I used to have to run a mile and touch my toes. And now you have to use AI effectively. Now you've got to progress in AI. Exactly, exactly. That's actually great. The presidential vibe coding assessment. But I do think it's important because at the end of the end, and I think the velocity of change that you see in how education is thinking about AI is so interesting to me. It's kind of like, and if you guys even remember, like two years ago when ChatGPT first came out, every university out there was essentially banning it. You weren't allowed to use it. You were like, you know, violating the honor code if you ever like turned on ChatGPT.

2:15:35And now there's no college student in the country that doesn't use it. So I think that the pace of change in how these models are being used in education is just so, so dramatic. And we have to get in front of it because, you know, what we think, you know, an eighth grader is going to be doing with AI when they enter the workforce, you know, it'd be very, very hard to predict. So what we try to do mostly in the K through 12 space is not necessarily teach kids how to leverage this technology, but teach them about how the technology works. The term that was used in the executive order was demystified.

2:16:06This is really important. teaching both children and teachers, like, where does it work well? Where does it not work well? Why is it answering questions like this? Why does it hallucinate? Why does it not hallucinate in these cases? And I think the more people understand the technology they're dealing with, they'll be able to leverage it much, much better no matter where they end up in the world. Yeah, I absolutely love that because I feel like the, I mean, we talked about this, the GPT psychosis thing. There's a very big difference between understanding that what you are chatting with is a robot, is a bunch of math, and just being mystified by it.

2:16:39And the same thing with, at some point, every parent needs to teach their kids that, hey, the explosion in that movie, they didn't actually blow up the house. That's a cartoon. And now you also have to do that with AI-generated images. Something I noticed, this was a major AI-related announcement, did not have a, I searched Command-F for a dollar sign, didn't find it. Is that intentional? Is that like part of part of your focus of, hey, the government can catalyze the right sort of like progress and activity without just being a capital provider? We've seen so many announcements from this year that are really just fixated on the biggest, you know, the biggest number.

2:17:22And this feels like unlocking the sort of potential within the existing ecosystem that's that's not being properly utilized. Yeah, for the Genesis mission, I think Congress actually appropriated some money to the Department of Energy this summer and some legislation that passed to drive some of these AI-related efforts. And we've used that as kind of the down payment on kicking off this program. I think what you're going to be seeing in the next couple of weeks, which we're really excited about, is commitments from a number of large private sector players on what they are contributing and donating to the Genesis mission.

2:17:59And I think what's key here is that what makes the American innovation ecosystem so unique is the ability for us to bring all pieces of the ecosystem together to drive innovation. You have one part academia, one part private sector, and one part federal government. And the reason why and the feature about the U.S. innovation system that allows us to be so successful and have been the home for the greatest scientific and technological breakthroughs for the last 200 years is that free market approach to innovation. And I think that's what the Genesis mission brings together and sort of highlights in the best way possible, that we are in this together with all pieces of the ecosystem working together.

2:18:36There's been a lot of worry about going too far, doing too much AI, too aggressive about the build out, too much debt. There was this back and forth about the backstop. David Sachs, of course, said, we're not considering that. But have you thought any more about what the role of the government is in moderating the amount of private sector AI build out and how that should even interface with the government at all? What is the framework that we should be using? I think we are very focused on removing federal barriers to folks that want to participate in the AI revolution. And for us, what we see is that if private markets and if capital markets are allocating dollars in a direction that say, look, we believe that we will be needing this level of compute to drive our future AI demands, we want to make sure that the bottleneck to that deployment isn't some federal rule around permitting and allowing these things to be built out.

2:19:40I have faith in the way that the capital markets are allocating dollars right now, and I leave it to those capital allocators to make the best decisions possible for that capital. What we want to make sure is that we are not an inhibitor to innovation, that some arcane rules about how and when you can build some certain facility in a particular place are not the reason why the data center we really need isn't built out. And that's the role that I think the federal government plays. And one of the three executive orders the president signed the day that the action plan was released was all about this.

2:20:11How do we get the federal government out of the way to allow the build out of these as quickly as possible? Yeah. What about going deeper in the stack? Obviously, there's been news around Intel. There's a very rational reason to understand, to prioritize having American control of the entire AI stack. How has your thinking evolved on just this idea of having a full control over the supply chain in America? Is that something you're spending time on or you're thinking about or your thoughts have evolved on? We are. I mean, it's so critical. Back to the great day in July when we signed all of our executive orders, the third executive order was all about exporting the American AI stack.

2:21:01And I think, you know, we rewind, you know, into Trump one when I was the CTO of the United States at that time, one of the challenges that I faced was traveling all around the world and trying to convince governments that they need to rip and replace their Huawei infrastructure. And at that point, I think there was a big lesson learned by me and by a lot of people who served in 45 about what are lessons learned from that experience? In that moment, the PRC had a technology that was good enough and was priced very reasonably, whether it was for a subsidy or who knows what, but it was priced reasonably enough where everyone wanted it and ultimately was deployed for a big technological shift with 5G.

2:21:47Now, if you fast forward to where we are today, this next phase of AI is orders of magnitude more important than the 5G rollout. Right now, Now, governments all around the world in very few short years will all be running some sort of AI stack. They will be having some sort of chips that will be running some sort of large language model. And on top of it, there'll be important, critical national applications. Everything from the way that hospitals are running to the way the tax is collected. And we want to make sure that the U.S. is the partner of choice for that AI stack. And right now we're at a great spot.

2:22:29We have the very best chips in the world and we have lots of them. We have the very best models in the world and we have a competitive ecosystem that it seems like every other week they're leapfrogging each other. And then on top of that, we have the best applications in the world. So we are so committed to exporting that stack. We want to create something that is so compelling and so exciting for governments and people all around the world that they will want to use our technology. And that's what we are building here at the White House, our partners at the Commerce Department and at the State Department to get that exported all over the world, from South America to Africa to Asia to anyone who wants it.

2:23:02Because we believe that the same benefits that all Americans are going to realize because of our great technology, we want to share that with the world. Yeah. Final question, a little bit of a wild card. I'm curious, are you thinking about humanoids as a category? I've been really concerned that we're going to repeat what happened with DJI, where we allowed a company to basically destroy our domestic industry and flood the country with cheap, very good, very good drones, but cheap drones. And I worry that, you know, I think you can buy a Unitree robot on Walmart.com right now. it's not a concern today, but if we allow the country to be flooded, I would be very concerned about it in the future.

2:23:48And I'm curious if it's on your mind at all. It is actually, it's funny you say that. We were just actually speaking about this week with a number of my colleagues. I think it is challenging. I mean, there was a large, well-known top sort of shelf research University that I saw one of their magazines that they published and they were advertising kind of how great they were. And on the front of it was like, you know, two unitry robots. And I was like, come on, guys, like, honestly, like we can do better as a country. You know, we have been the home for Boss Dynamics for, you know, over two decades.

2:24:26And I think to me, this is an opportunity where we should think about it in terms of the larger AI stack. And if you start building from chips all the way up, you know, the ultimate manifestation of all this is where a lot of these ultimately robots play out. It's this marrying of the physical infrastructure with the digital itself. And I think we do a lot more as a country to be able to propel that industry forward, to make it economical for the adoption to happen. And it goes back to something I talked about a little earlier. It's a lot about trust, you know, and I think there's, you know, if you think about kind of the dynamics oftentimes in the global marketplace, funny enough, the Europeans tend to be a lot more quick adopters, early adopters, a lot of this technology, just because of the issues that they have with some of their workforce.

2:25:13So I think for us, we want to create an environment where we can build these robots into our economic growth plans here in the U.S. and think very critically about the way that we want safe, secure, and trusted technology used by Americans in America. And if we see foreign companies that are not safe, trusted, insecure and are compromised, there's lots of tools that we have in our arsenal to protect our ecosystem from it. And the US government, for example, banned DJI for use by the federal government. And there's lots of other examples like that. Yep. Okay, actually, last question. Do you fish?

2:25:47What's the biggest fish you've ever caught? We like to ask that to everyone that joins the show. Oh, man, I thought that was coming. I actually do not fish. So if you guys ever want to take me fishing, I am totally game. I haven't either, so we can go together and figure it out on the fly. Yeah, yeah. Well, thank you so much for taking the time to come talk to us on your busy day. Always welcome. Congratulations on the Genesis mission. We're very excited for this. And have a great Thanksgiving. Happy Thanksgiving. Happy Thanksgiving. You guys, too. Let's do this again soon. See you. Absolutely.

2:26:15Goodbye. Cheers. Let me tell you about Profound. Get your brand mentioned in ChatGPT. Reach millions of consumers who use AI to discover new products and brands. Let me also tell you about TurboPuffer, Service Vector, and Full Text Search. built from first principles and object storage, fast, 10x cheaper, and extremely scalable. Founder Mode is right. We have Sebastian from Klarna in the Restream Waiting Room. We're going to bring him in to the TVP in Ultradome. How are you doing? Great to see you again. It's been too long. The last time we hung out, it was just another day at work for you. You just stopped by, nicey, you did your IPO, and you jetted back home.

2:26:51But it's great to be back. Yeah, kick us off with a review. What's it been like being a public company CEO for a couple months now? Well, we said to ourselves on the management team, like, we're never going to watch the stock price. Never, ever. And then every day I was like, what? Why did it go up? And then somebody came to us and, guys, just put yourself next to all the other stock. And they're like, oh, yeah, it's moving the same way. Got it. Okay, got it, got it, got it. It wasn't just us. Yeah, makes sense. Well, big news on Tuesday today. Please break it down for us. What's the news? No, I think it's, you know, I think I was, it's kind of funny because I, like about a year ago, I was like giving crypto a second chance.

2:27:37I was always like, you know, I was a little bit of the, on the skeptic side over the years. And partially it's because like I was, my LACMUS test is like, how is this going to help my mom? Right. And as much as I'm getting excited about financial revolution, kill the central banks or whatever. Sorry, I shouldn't have said that. I'm going to re-quote. Bring financial liberty to the world. That's the way. Those things. The point is that that doesn't get my mom much excited. She's like, what? Can I just pay cheaper or can this be faster? She doesn't really care that much. The noise in the industry was insane.

2:28:11I mean, it was so many just regulatory arbitrage moments, so much just like fraud and grift and also just like pumps and dumps and all sorts of just like memes and things that weren't outright frauds but had just like total. But the potential was always there. There was always a little bit. And the technology was always a little bit real. And I'm sure I imagine like I'd love to understand how you're thinking evolved on stable coins over time. Yeah. Because back in 2021, what happened was some close friends of mine called Sequoia said, like, Sebastian, you really have to take a second look at this.

2:28:50And I was like, OK, fine, I'll do it. And they introduced me to some amazing founders, among them Bridge, that we now partner with. And so I gave it a second chance. And I listened to the stories and I realized, yeah, OK, so I've been wrong. Technology has now moved ahead. It's now fast. It's now efficient. It actually solves real problems. And then I wrote that on X and I was like, nobody's going to care because we're the last fintech in the world. It's not going to make any news. But it was surprising, like over a million people views on that post. And since then, we've been just working hard on like, how do we integrate this into our stack and what can we do?

2:29:32and today we announced that we're doing the Klana stablecoin, which is one of many things which we're doing with Bridge and Tempo, which is together with Stripe and the team over there. So that's really exciting. But obviously, there's more to come. It's just that we're testing the waters and trying out what will work for us. So, yeah, walk me through what the first few implementation points look like. If I'm going and I'm paying and I'm on a checkout page, right now I can check out with Klarna. At what point do I actually interact with Klarna coin, the stable coin? When does it actually come into the workflow?

2:30:15So, so far the start of this actually is just that like, we obviously want to bring these services to the benefit of our consumers and in their day-to-day, you know, using of Klarna. I mean, we have a big neobank ambition, right? and we have over 100 million users worldwide, but most of them will only use us for a single transaction. Thank you. Sometimes it's like, you know, a lot of those buy now, pay later, but actually over 20 % of them are debit, where people pay the full amount as well. So it's a mix. And now we're trying, you know, we're trying to offer ourselves more advanced services, more neobank services, right?

2:30:52So we have our card. It's pretty cool. Like, you know, we are now 3 million active cardholders. a quarter ago, we had zero in the US. So, exactly. I'm going to drop a lot of numbers. I'm going to get a lot of beeps. So, that was like, yeah. So, that's been great. But obviously, we want to add peer-to-peer. We want to add the ability to send money and so forth. And then we'll be looking at different solutions. But what's interesting, I think, here is that, like, even though that's the natural next step of, you know, offering, using Stablecoin for that, because it's a very efficient way to send money fast and at low cost.

2:31:29We also actually realized that, look, I mean, we're processing over$100 billion worth of volume every year, and we move ourselves quite large money between the US and Europe and so forth. And this may actually be very efficient even for our treasury department to use as a way to move money, right? So we've seen that there's a tremendous number of use cases, maybe more than we realized when we started looking into it. that's exciting and that can drive you know anything that obviously drives our efficiency will also allow us to offer services at lower cost and more value to our customers so can you break down specifically what's happening at each kind of level of the stack so you have bridge which is from my understanding the infrastructure that you're using to actually issue the token then you have tempo which is the blockchain in which you'll be moving it around on is that and And then you have, obviously, the product layer, which is the interface that consumers will use to move around.

2:32:27Is it USDK? What is the ticker? I think it's USDK. I think you've described it pretty well. I was like, thank you. That's a good summary. Yeah, yeah, yeah. Because I'm just trying to understand. And then you also have, there's a corporate treasury use case where you're saying you could use the same token internally as well. Yeah. I mean, yes, exactly. I think also then people discuss a bit on the merchant side, but the truth is that we mostly today distribute through Stripe and Adyen and the big PSP. So mostly the kind of merchant relationship happens directly with them. So to us, it's mostly what we can do on the consumer side.

2:33:03But I think there's more opportunities. I mean, this is just like, again, people are like, oh, why did you do it this way and not that way? Why didn't you use Solana or Ethereum? And why didn't you, you know, whatever. And what about Bitcoin and so forth? And to me, it's like, yeah, but come on. This was just like one first thing that we now announced. And obviously, we are working on more things and we want to utilize these technologies to more use cases. And we have more things, but we are not yet to announce them and talk about them. So more to come. Fantastic. Last question from my side. Who do you think is, or what, you don't need to say a name of a company, But like what type of player in the financial industry loses out most if stable coins really take off?

2:33:53It feels like at a certain point, we're just shifting take rates around. There's a lot of different transfer services that could benefit a lot from higher speeds and lower fees. It seems like consumers could benefit a lot. But do traditional payment rails suffer? Do governments suffer? What category really needs to be on their back foot right now? To me, it's really, and I actually talked about this a little bit on our earnings call as well, is that I actually think, to me, I put the whole crypto thing in this wider AI change that's about to happen. And if you look at it, both fin and tech have been extremely inefficient market, which is why you've seen the excesses in profits and excesses in, you know, as I quoted there, like, you know, the gourmet cafeterias used to be called culture and now they're going to be called overhead.

2:34:43The point is that, like, there's been this huge excess because it hasn't really been that strong competition. And why has there been lack of competition goes back to kind of classical microeconomical theory, which states that if it's hard to compare two products, if it's if, you know, too many legal terms that are hard to understand and so forth, then people will be fooled and will take products that are less good for them, right? And AI and new technologies brings a fantastic amount of transparency. You can just ask, compare these insurances, compare these banking products, what is the best one?

2:35:13Compare these credit products, which one is actually the best one for me, right? So that's going to change. The second thing is the major one, which is very connected to crypto is switching costs. So the big reason banking isn't more competitive is simply because it's such a hassle to move. You know, like I want to bring all my stuff from this bank to that bank. And people just don't have that energy, right? Like people don't have that energy and all the accounts and the salary coming in and all that stuff, right? So what's happening is with technologies like crypto, with AI and the combination of that, what you're going to see is you're going to see switching costs coming down to almost zero, right?

2:35:49It's just going to be much easier to move between different services. And it's just going to put this massive competitive pressure on this industry. I mean, financial services make over$500 billion in profit. That's the profit pool that we're after. And then tech and advertising and tech is another$500 billion. That's a trillion dollars in profit pool. And so what I think is going to happen is, if you are willing to be customer-obsessed, efficient, you know and with efficiency operational efficiency crypto plays a role because it can help you be much more efficient you can move faster at lower cost and so forth then the players who take the advantage of these technologies are going to make a massive dent and the benefit i believe and maybe you can call me naive or you can call me you know optimist but like i believe that the value of this is all these excess profits that we see in banking they're going to come back to consumers.

2:36:46They're just going to make, consumers are going to pay less for higher quality services. And some financial institutions will lean in and they will transform themselves and they will be more customer obsessed. There will be less marble offices, less beautiful buildings and all that stuff. And there will be more of just like waking up every morning, just like a restaurant or any other business for the sake, where you actually wake up every morning and you're like, how do I bring my customers in? How do I make them happy? And how do I run my business so I'm operationally efficient, right? And that's a huge difference.

2:37:15And I think crypto plays a role in that. So I think that's what's coming for Fin and tech. And if you're willing to be that customer obsessed and run those operational efficiencies and be smart and use these technologies, there's obviously tons of opportunity of growth and you can build trust with your customer base. But if you're going to sit there and still continue making the kind of profits you are today and think that nothing's going to change, well, eventually you'll wake up, right? Just like, you know, whatever airlines did when low-cost airlines came in. We've seen this over and over again.

2:37:43Carriers, when the low-cost carrier things came in, it's happened before, right? Yep. Well, thank you so much for taking the time to come chat with us. We will talk to you soon. Have a great rest of your day. Great to get the update. Thank you. Good to see you. Talk soon. Cheers. Before we bring in our next guest, let me tell you about public.com investing for those who take it seriously. They got multi-asset investing, and they're trusted by millions. I'm also going to tell you about numeral.com. Let numeral worry about sales tax and VAT compliance. Compliance handled so you can focus on growth.

2:38:15We have David from 1Password in the Restream waiting room. Now he's in the TBPN Ultra Dome. Welcome to the stream, David. Welcome back. We have a big update for you. Since you came on the show last time, we onboarded the whole team onto 1Password. John, we were using it individually. There were some passwords being stored in the Notes app. We corrected that. Yes, yes, yes. I'm glad I was able to shame you into action there. Yeah, this is real customer development, getting your hands dirty, rolling up your sleeves. You go on the podcast with 10 employees and you physically tell them, download my app.

2:38:52And it worked. It worked. It worked. But anyway. One customer at a time. Thank you again for your trust, both with your business and your personal life. Yeah, we're very happy. It's been a huge upgrade, and I think it's going to sail to being a valued piece of infrastructure in this organization for many years. But we're also very excited that you've been on a tear. Your business is doing better than ever. Give us a little update. What's new in your world? Yeah, so we had a little announcement just to refresh some of the statistics of the business a couple weeks ago. So we are over$400 million of ARR.

2:39:29Whoa. There you go. Love it. A spinning hit. Spinning hit for 400. We've grown to that level profitably all the way from inception, which is really cool. You know, durable growth profile. And we continue to be very profitable. We now, we're known as a consumer app for a long time, but now nearly 80 % of our business is selling to business customers. 180 ,000 business customers use the product. 180 ,001 now because of you guys. So thank you for that. And, you know, we support over 1.3 billion credentials that are managed in our system. and we have over a million developers using the product. So we feel really good about the trajectory that we've been on.

2:40:09We've also, in that announcement, we also announced that we've added to the team. So we've got new leaders driving the ecosystem and the revenue side of the business, enhanced the tech side as well. We're really just setting ourselves up for the next chapter here. And as we chatted last time when we were together, we just see the opportunity around AI is really something significant for us and we're going all in. Yeah, I want to talk about that because it feels like there's, is there a fight coming? Because credential management on the developer tool chain side, the API keys, that's traditionally been a completely separate industry, a completely separate, you know, I don't even know if you guys run into each other at industry conferences.

2:40:51It feels like a very different world. One's a developer tool. One's a consumer tool that you use with your family. Then maybe you wind up using it at work. There's single sign-on. There's all sorts of different ways to manage credentials. How much are they blurring? How quickly is this happening? How are you thinking about setting yourself up for the world where, I mean, Shalto from Anthropic was on the show yesterday saying, we're creating a co-worker. Digital co-worker. Sounds like a digital co-worker who needs some passwords every once in a while. How are they going to get it? Absolutely. I think, you know, the traditional identity systems that have been siloed and sort of different parts of the puzzle and really hardwired into big enterprises over the years.

2:41:29They don't really know. They're not set up to support this federated dynamic environment where applications spring up and agents need access that are very, very specifically scoped to what they're trying to accomplish. And then they need to be sort of tracked and managed and many times revoked. And so that system of identity and access management really doesn't exist. And we're in a really good position to support that. And we're doing a bunch of things already to help people use AI tools securely. I'll give you a couple examples. So we were a launch partner with Perplexity's Comet browser. I'm not sure if you've seen that.

2:42:01But then shortly thereafter, OpenAI and ChatGPT Atlas came out. And immediately, both they and we got besieged by a customer saying, I need to be able to use 1Password with Atlas. I'm not going to use this thing unless it's it. So we got on the phone with them and we started working together with them. And quickly, we made 1Password available as a browser extension on Atlas with a little bit of a workaround. And then just today, we announced the release of a fully optimized onboarding experience, optimized for the workflow experience in the Atlas browser as well. And so what we learned is, look, customers, they want to use these tools, but they want to be able to use them safely and securely.

2:42:38And they want to be able to have trust. So that's what we've always been about, is bringing that trust to the table. And so we'll be wherever our customers need to be. Last time we were talking about the headless browsers around a browser base, but like with perplexity and Atlas, you know, our customers want to be able to use these tools without having to give their credentials over in raw form. So that's one aspect of it. The other is what's really interesting is, you know, we're moving from applications being developed by software engineers to being developed by everybody. And it's amazing how much of the agentic applications that are being created are not necessarily by software developers.

2:43:13And so it's great. It's very powerful. The whole organization can figure out ways to leverage it. But again, if you need API keys to be part of the, you know, in the environment that you're building, SSH keys, you need to be able to actually have those things secured. And so our developer tools, they sync with AWS Secrets Manager at runtime. They allow you to put a pointer to environment file tools that we build so that your credentials are always encrypted, end-to-end, fully traceable, fully revocable. And so that's the beginning of what you'll see. And then where we're going from here, discovery of agents, governance around it, how does it interact with the observability systems?

2:43:52There's a whole green field of things there that we're really well positioned to participate in and really help define the standards. So, you know, we're going for it. It's a very exciting time. How are you thinking about resiliency? Do you have any tips for folks building, you know, mission critical systems these days? It feels like we were fighting an outage with AWS at one point. Cloudflare went down. We don't have nearly the resources that you do, I'm sure. But what tips and strategies have you used? Because I feel like you're definitely going to hear if 1Password goes down. Yeah. We are a Cloudflare customer.

2:44:31So our marketing site was down. Our service wasn't down. Sure. So we're using, obviously, dual redundancy and failover procedures. We come from a security-centric approach. That's probably what's differentiated us from a lot of the other players in the space. Like security is job one and job 10 and like nothing else matters until we're sure that everything we're doing is the utmost security. So we've got a lot of resilience built into the way we do it. But I think just generally people need to be aware. Like the threat profile is so much more hostile than it's ever been and it's going to get a lot worse.

2:45:07I'm sure you did a bunch of work on the disclosure that Anthropic put out around that. And it's not just, I mean, Anthropic, you know, as you know, they have like nation state level security, you know, enforcement. They have like bunkers and all kinds of stuff that they've got to worry about, right? Because they're, you know, hugely a big target. But it's not just the biggest guys anymore. It's really anybody can be a target because you can do really sophisticated social engineering at scale with almost no effort at this point. And it's going to get worse and worse and worse. So the number one thing that people, you know, will expose is weak credentials.

2:45:43It's another really good spot for us. Credential hygiene is more important than ever. So whether you're using Atlas and you're a 1Password customer, great. Make sure it's connected. If you're not a 1Password customer, you should go get it if you want to use Atlas. And if you're a developer and you're building an application and you're not and you're hard-coding credentials or SSH keys, et cetera, into files, don't do it. Get a 1Password license, super easy to use, keeps you secure, keep everything ever locked up, and maybe we'll get another new customer out of this. I love it. What's your timeline to a point in time where the average American on, let's say, a weekly basis will be sending an agent out to do something for them and the agent needing to actually utilize the, you know, like actual login infrastructure of the user?

2:46:31I'm talking about imagining the workflow where my agent's doing something and I get maybe a 1Password push notification that's – or I don't know exactly how the workflow would work. But saying, hey, I want to do this. Do you approve it or not? And then I hit yes, basically authorize the agent. So that's exactly what's happening with BrowserBase, for example, right, and the headless browsers that we're doing. Exactly. It's low friction, user verification, so that allows you to keep things secured. Look, we're seeing tremendous uptake on the, you know, Atlas was a really was enlightening to see how many people are actually trying to sort of utilize the browser and have it do things on its behalf.

2:47:08Certainly, the other partnerships we've had were so early days on it. But I think when we're going to hit this inflection point where people realize, I mean, I'm starting to see how valuable in both my professional and personal life the tools can be and just shortening my day. And obviously, you know, I want to make sure I'm doing it securely. I think most people are going to be in that mode before we know it. And so we just want to make sure we're available for our customers when those moments come so that they can do so securely. Last question. What's the biggest fish you've ever caught? Well, I'm more of a fly.

2:47:43I enjoy fly fishing more than I do like deep sea fishing, getting sick on a big boat and hauling in a big marlin. Yeah, deep sea fishing is the ultimate hack if you just want to catch the biggest fish, right? It's pretty simple. Somebody else catches it. Yeah, it really did. Yeah, my son prefers fly fishing, so I follow him. He likes to catch a big bass. Where is the best fly fishing spot? You know, I like Montana and Utah. Utah. You like Utah? Utah and Montana. Utah, fish are a little smaller. Montana, a little bit bigger. But two really good spots. We're going to become – we're never going to leave this building, but we're going to become fishing experts.

2:48:21We're never actually going to – Just through our gas. But just through asking every guest a little bit more about fishing every day. Eventually, this will just be a fishing show. I like it. I like it. Get yourself a guide. Go on a fly fishing trip. Take a weekend. Go to Montana. You'll love it. Thank you so much for coming on the show. Happy Thanksgiving. We'll talk to you soon. Let me tell you about Vanta. Automate compliance and security. Vanta is the leading AI trust management platform. One thing that's cool. Back in 2019, 1Password raised from Excel. and when they announced it, they said Excel will be investing 200 million for a minority stake in 1Password.

2:48:58And you don't see that positioning a lot, but it was a very minority stake, obviously. They put in about 200, I think. Was it 200 on one or two billion? But anyways, absolute beast of a business. Well, up next, we have Keller from Zipline. We're very excited to talk to him. There's some big news. The eagle himself. Yeah, get that ready. First, I'm going to tell you about Figma. Think bigger, build faster. Figma helps design and development teams build great products together. And there's someone who built a great product with lots of talented individuals. Keller from Zipline. We'll bring him in as soon as he's ready.

2:49:42Oh, I don't think he's ready yet. But in the meantime, we can go to the timeline. Yeah, we have a post here. somehow no I'm going to jump somehow David Ulovich former guest of the show said turns out huge swaths of the BS on this platform that claims to be from the US is all foreign and then this Fakil quoted and somehow the A16Z account is based in Canada I really don't I really don't know how this this is actually possible I want to see if it's been updated I did check all of her accounts and I think we've been marked safe I haven't checked actually most of the team, Tyler, I don't know, maybe just secretly.

2:50:20I just know so many, I have so many friends at Andreessen. I don't know how, why does Tyler's account say it's based in North Korea? I don't understand that. I know. Have you been to Pyongyang recently? Is that where you're going over the holidays? Yeah. You said you're leaving. This is misinfo. He goes, oh, I have a dentist appointment. I can't come in tomorrow. He's going back to Pyongyang for a little touch base yes yes um what uh what what happened with this uh uh meta uh uh whistleblower sister uh situation i don't know del says i'd love to see tv well you're not gonna see it you're not gonna see it right now i do want to come back to this but we have our guest here so we will bring in keller from zipline welcome to the show from the floor fantastic setup best team in the game good to see you.

2:51:12How are you guys? We're fantastic. You look great. Give us some updates. What is the latest news in your world? Very excited for everything that we've been seeing on the timeline. I want to go into all the jokes about what happens if you shoot one of these down. But first, let's get the serious update. Let's get the serious questions out of the way. I mean, yeah, there's a ton going on. The thing we announced today is that Zipline just signed a$150 million contract with the U.S. State Department. Yeah. To triple the size of our life-saving autonomous delivery network across Africa, we're going to go from serving about 5 ,000 hospitals and health facilities to over 15 ,000.

2:51:58We'll add about 130 million people to the network who don't have access today. And the last cool thing about that is that that$150 million comes with up to$400 million of co-financing commitments from the African governments themselves. So, you know, this is not, this is not a... Just straight on the taxpayer. Yep. Yeah, exactly. This is actually like encouraging investment in this kind of infrastructure. Yeah. So was this, was this delayed because of the USAID pullback? There's been a lot of like back and forth on how much the U.S. would be investing internationally. What would be happening? Has the dust kind of settled there and there's now time to actually go do a partnership like you just did?

2:52:36What's the kind of state of the union? Yeah, I mean, you know, obviously, earlier this year, that was like the first phase of a big shift in terms of how the U.S. is interacting with developing economies. And I think this new vision that's now being talked about by the State Department of commercial diplomacy, the whole idea is let's not, you know, let's not treat these countries as charity cases. Let's actually treat them as allies and trade partners. And the good news is these countries have been saying for a decade that they want trade, not aid. They're sick of low-quality services provided for free by NGOs.

2:53:09What they want instead is high-paying jobs, entrepreneurship, technology. And the thing is, that's what the U.S. has to offer. We can deploy AI and robotics infrastructure into these countries in a way that will save lives and kind of turbocharge their economies. So$150 million from the U.S. State Department matched with$400 million from the partners internationally. 10 ,000 health facilities. How many actual drones is that? How are you actually thinking about scaling your, like, what does this allow you to do? Are you going to be staffing up, hiring tons of people? Is it just build another factory?

2:53:46Is it a dedicated factory? Like, walk me through how you plan to actually use this money over however long you're planning to work on this particular growth initiative. Yeah. I mean, look, in a way, this is coming at the worst possible time because as you guys know, the U.S. business is growing really, really fast. We're in the middle of, I'm here on the manufacturing floor. I mean, you can see like dock electronics happening over here, Zip Platform 2, Zip manufacturing. And then if we were to go straight behind the camera right now, we're just opening up a new 100 ,000 square feet of manufacturing facility that'll produce both the Platform 2 technology as well as accelerate manufacturing for this specific contract.

2:54:33In total, this manufacturing facility is capable of building about 20 ,000 autonomous aircraft a year, and it's all happening in South San Francisco. So this is the cool part of this compact, which is that this is not just a big deal for all these African countries that are now leading the world in terms of deploying autonomous infrastructure to save lives. It's also really good for the U.S. because we are sort of securing U.S. technology and manufacturing leadership for the decade to come. This is creating high-paying jobs in the U.S., and it's accelerating all of our manufacturing efforts here.

2:55:07Okay. Let's shift to what's actually going on here. You know, we've seen the initial partnerships that have rolled out. What have you learned most recently about or what has surprised you about the actual application of the technology, the adoption? like where are the underrated use cases beyond the meme that I'm sure will follow you forever, which is the private jet for your burrito. So get ready for that one to be around forever. I mean, we just had Sebastian from Klarna on and his entire business, which serves all sorts of different customer bases, has collapsed to buy now, pay later for your burrito because they did a partnership with Chipotle.

2:55:47Burritos are powerful. I think it's actually a bullish indicator if your business is getting burrito memed. It is. It is. But yes, where do you see the shape of the U.S. business going? Where are the exciting developments these days? I mean, look, on Saturday, Zipline hit an all-time new record number of deliveries across the U.S. Then on Sunday, we blew that record out of the water by 10 or 15 percent. So it's like every day is basically a new record at this point as a company. I would say the most interesting things are it feels as though we accidentally like stuck a pipe into the Pacific Ocean.

2:56:24Like demand is so vastly outstripping our ability to build capacity for this kind of service. And keep in mind, I mean, right now, you know, we deliver products in two to three minutes. So even from like when a customer presses a button to have something delivered to their front yard or backyard or front doorstep is typically around 15, 16 minutes. And so it is very magically fast. That results in customers changing their ordering behavior. Like, you know, a lot of our customers say they'll grocery shop once a week and then they'll order from Zipline three to four times a week. So people are using Zipline more than the average Amazon Prime subscriber uses Amazon Prime.

2:57:03And not only that, but one of the big changes, just since, you know, I was last on with you guys, is that a lot of these restaurants are really accelerating. We're now doing 15 to 25 percent of deliveries from these restaurants that we've integrated with. So we are similar size on a per delivery basis to the big delivery platforms. And so I think, you know, maybe people still think, oh, the technology is like sci-fi. It's like years away. And it's funny sitting here thinking like, wow, I mean, this is like completely normal in the neighborhoods that we are that we're serving. Talk about the actual experience of getting, let's say, items from a restaurant.

2:57:40We had David Chang on. He was excited about drone delivery and the technology. I tweeted at you guys, and we're going to try to deliver for him in Dallas. Yeah, yeah. And specifically, he was saying he didn't think it would solve the delivering something hot. From my point of view, if I'm used to getting something in 20, 25 minutes, and then you deliver it in three minutes, like that feels like it will be a material improvement. So I wasn't, I didn't quite understand what his point was, but what's the actual experience been like for people and what's kind of the average speed up in terms of delivery times that you're seeing?

2:58:20I didn't really understand what David was saying either. But look, like the, you know, our comms team hates when I talk about this, but you know, like one of the first food deliveries we did, the customer badly burned their tongue. on the food. Okay, yeah, I can see why they don't like this. That's the restaurant's fault. They served food at a dangerous temperature. Yeah, yeah, yeah, it's kind of a bad thing. I was like, no, actually, we should make this like a core part of the marketing. Like, that is crazy that customers are so not used, they're so used to getting like fries. They're 45 minutes old and like ice cold and soggy and gross and food that tastes bad and milkshakes that are melted.

2:58:59And we just put up with this shit, man. Like, we're completely used to it. And so I really think this is going to, in the same way that maybe David's expectations are going to get kind of reversed, it's totally happening with all the customers. When you can get something delivered and there's only two or three minutes from when the thing comes out of the oven to when it is delivered to your front doorstep, that is a way different customer experience. I think actually people are underestimating the difference in the quality of that experience. Like food tastes really good. but it's almost like you're having an in-restaurant experience at home.

2:59:34I wonder, so I remember when the delivery boom happened and all of a sudden people were ordering way more food, and it was really like a TAM expander. There were obviously ways to get delivery. You could order a pizza 30 years ago on the phone. They would deliver it. But when it became an app and the market expanded so dramatically and people were starting to, you know, DoorDash and Uber Eats, like every night, lots of people did this, the market grew and it actually changed the nature of our food. And we got ghost kitchens and we got these funny knockoffs. Like there's in LA, there's sugar fish.

3:00:07And then I saw one that was like sweet fish. It's like they will deliberately try and change the names as close as possible. And you get these like kind of restaurants that only exist because of the new technology. And I'm wondering what you think of the impact, uh, if there will be a change in the nature of the food or the nature of the restaurants just because the delivery time goes down or because of the shape of the box. If you can't do a massive six-foot pizza, maybe some smaller products like Emerge is the dominant form factor and the restaurants that conform first. Six-foot pizza, John?

3:00:46I don't know. The size of this table. I don't know. The kids' birthdays. You see those? Yeah, yeah. They're pretty big. It's not six feet, but you get my point. Will there be restaurants that are like, okay, we're going all in on Zipline. We're thinking about developing meals from first principles that fit for the best possible experience on the Zipline platform. And then that becomes like a new thing that actually changes our culinary experience. I mean, I'm not an expert, but I have a bunch of like hypotheses. And I would say a couple of things. First of all, I actually think we have to do a ton of design of the food now to make it work for a system that is going to deliver the food 45 minutes later and ice cold.

3:01:31And also, there's a lot of innovation that has to go into the packaging. Because I don't know if you're familiar, but 60 % of food delivery drivers report eating some of the food that they delivered in the last 30 days. Oh, no. Really? Really? Doing all the tamper food packaging. 60 %? 60 % hopefully over the month. Not 60 % of every time. Over the last month. Not 60 % every time. It's 60 % over a month. They're like, but only when it's really good. Only when it's really good. Only when it's at my top five favorite restaurants. One fry. One piece of sushi. Yeah, sorry if I'm ruining it for anybody.

3:02:02But like, you know, so we have to innovate on like tamper-proof packaging. We have to figure out like safety and we have to figure out reliability. And like, you know, some percentage of things just get picked up and then never delivered. And a lot of things actually like the driver will accept the order, but then actually just never show up at the restaurant. Then they have to throw out the food, remake it again. So, you know, I think there's a ton of inefficiency and cost in the system that we all just don't think about. But you do end up paying for in fees and, you know, all the crazy fees that get added on top plus tip.

3:02:30I think another big thing that's going to change is that, you know, this technology is designed to be able to fly out to 10 mile radius. And typically it's not cost effective to deliver something with a car more than like three or four miles. And so that means, you know, it differs on by Metro and where we're talking about. But like that means that these kinds of systems for any given restaurant, you're going to enable about 10 times as many customers to receive instant delivery from that location. That's a big deal. And it's a bigger deal actually for like mom and pop restaurants or kind of local heroes versus a really big chain like Chipotle that actually has a ton of stores.

3:03:06And so I think, you know, especially when you think about a place like L.A., for example, we have a lot of these different parts of the city that are hard to reach. Traffic is terrible. You know, it can take an hour plus to get delivery of food. you know, this technology is going to be like transformational and you can deliver a lot of like the best, most beloved kind of local hero brands and make it universally accessible. By the way, on the universally accessible front, you know, some of the cities we're serving in Dallas right now, I mean, just one city that I was looking at statistics for yesterday, 46 % of homes are ordering from Zipline in that city.

3:03:40And so I think people don't appreciate, yeah, exactly. I thought it was like a map error when I looked. People talk about startups getting like 2 % market share, 5 % market share. It's like Zipline. In a few weeks, Zipline will literally have the majority of homes in our service area ordering from the service. And that's not a joke. How are you? So clearly, it's working. Clearly, customers like it. There's an insane amount of demand. How are you pushing the team to move faster? Because at the same time, yeah, I know you want to be practical about the rollout and not get over your skis. But at the same time, I mean, people in our chat are – anybody that sort of knows it exists, they start to become angry that they don't have it in their area.

3:04:28And I'm sure there's people sending you messages all day long asking you, when are you going to be here? When are you going to be here? So yeah, we're going to be announcing something very shortly. We just started talking about it internally, but we'll be announcing the next two metros that we're launching in Q1 and Q2. So look for that in the next week or two. We are then going to start accelerating and adding multiple metros a quarter starting in the second half of next year. So we are trying to move super, super fast. Hardware companies are hard in that you have to scale all these different parts of the business simultaneously.

3:05:03It's in the name. and also it's like you you know you got to make really sure that you don't accidentally bankrupt the company and actually the faster you're growing the easier it is to back bankrupt the company because like you know these numbers when you're when you're building 20 000 autonomous aircraft a year the numbers actually start to get really big you got to make sure that like the hardware is validated and like you have you know sites that these that the hardware can go to and begin operating you got to make sure that aircraft utilization is high if you make you know there's there's a lot that has to move in tandem in order for the business to work.

3:05:35So, I mean, to put it into perspective, right now, flight volumes have been growing about 15 % week over week for the last 30 weeks straight. We are now planning for next year. Yeah, we're planning for next year. And we actually just re-forecasted the entire business. And we are planning to actually double our growth rate next year relative to what we were planning just at the beginning of this quarter. It's, yeah, and I don't know how much I can, you know, we are definitely anticipating like exponential growth. I feel like you've given us enough to do a whole DCF at this point. It's fantastic.

3:06:10Yeah, exactly. Just send it straight to Wall Street. I appreciate it. This is so exciting. Congratulations again. It's always a great time. You guys got to come to Dallas, I think. I think it's probably at a point now, you know, when I was in Dallas last week, Like we're just hanging out at all these different, you know, these different neighborhoods that are using Zipline. And there were neighborhoods where I saw more zips than I saw cars. Wow. And so I don't, you know, it's funny how the, you know, the future is here. It's just not evenly distributed. I think there are, you know, certain parts of the U.S.

3:06:42people are like, oh, yeah, it's sci-fi. Like, you know, it's totally goofy. And then there's like, yeah, some metros where people are like, oh, yeah, I use it like three to four times a day. And by the way, these are like predominantly moms and grandmas. There's a lot of AI researchers that say that getting Waymo into DC will significantly update the administration's AGI timelines because they will just see robots on the street and they will recognize that this is a real thing. And until you actually see it diffused in the world, it's very hard. It's very abstract to just see reports. Oh, Waymo has a thousand rides or 10 ,000 rides or a million rides.

3:07:18It's like, what does that mean? but when you are walking and it's like oh seven waymos in a row and they're all driving fine not crashing into each other you get it even tesla fsd i mean i was hanging out with my college professor and he'd like had no idea what fsd was or that it was working we've heard about it for so long but it's finally here so yeah very exciting well thank you so much for coming on the show uh i hope you have a great thanksgiving and we'll talk to you soon i'm sure you'll be back soon. Yeah, you'll be busy delivering turkeys. Hot. Whole turkeys soon. Small ones we can do.

3:07:49Small ones you can do. Okay, great. I love it. Well, congratulations. Great to catch up, Kelly. Great to see you. Cheers. Before we bring in our next guest, let me tell you about Julius AI, the AI data analyst that works for you. Join millions who use Julius to connect their data, ask questions, and get insights in seconds. And I'm also going to tell you about Privy. Privy makes it easy to build on crypto rails. Securely spin up white label wallets, sign transactions, and integrate on-chain infrastructure all through one simple API. We have our next guest in the Restroom waiting room, Royce Branning from ClearSpace.

3:08:23How are you doing, Royce? Welcome to the show. Good to have you. How are you doing? Thanks for having me. I'm doing well. How are you guys doing? I'm doing well. Can you kick us off with just a little bit of intro and background on you and the company? And then there's a whole bunch of questions that I'm sure we're going to get into. Totally excited to dive in. My name is Royce Branning, co-founder and CEO of ClearSpace, and we help people reduce their screen time. Our company, our mission is to build a missing intentionality layer of the internet. We think there's a fundamental asymmetry in the war for your attention, and we're equipping the individual autonomous consumer in the market with the ability to steer their focus online and protect their family's attention online.

3:09:03What's a perfect amount of screen time? Have you guys run the numbers? Is there an optimal? Well, you know, Andrew Ross Sorkin asked Peter Thiel this in Sun Valley for his kids. He was like, you're on the board of Facebook. How long, how much screen time do you let? Did he say like zero? He said 30 minutes a week. Oh, yeah. 30 minutes a week is ambitious. I think that the ideal amount of screen time is probably a little bit less than whatever you're spending right now. Sure. We say that a calorie is not a calorie is not a calorie. A minute spent on a screen is not equivalent to another minute spent on a screen.

3:09:36Sure. But you want to be increasing the quality of the consumption. And usually overall reduction in quantity ends up meeting an increase in quality. Yeah, that makes a lot of sense. So how do you actually do it? I mean, there are screen time functionality natively baked into Apple. The iOS, I'm sure Android has it too. Your business is still working, so it's not like you're getting steamrolled. But how do you differentiate? it yeah do they have uh is there any sort of misalignment to apple's business with screen time because i imagine if they really incentivize people to use their screen less it's like less apps that i'm subscribing to and less kind of potentially less like they don't have a perfect incentive to make you use your phone less they sell you the phone once but they're like take more pictures get those get those iCloud subscriptions up yeah buy more apps spend more in that mobile game, et cetera.

3:10:30A hundred percent. Yeah. Yeah. We think Apple has every incentive to have a solution here, but maybe not the ideal incentives to have an effective solution to helping people kind of control their screen time and reduce it. We think that it comes down to both visibility and control. So you have like a feedback loop that's helping people identify how much time they're spending on devices and like where that's actually going. I think the current state of screen time right now is basically like, again, to use food if you only tracked calories that you consumed, not micro and macronutrients. So for the last two years coming out of YC, we've been primarily focused on a mobile app that grows people's awareness of how much time they're spending on devices and then allows them to add little bits of cognitive friction into the addictive habit loops that they use on different apps like social media.

3:11:14And that kind of starts to get them rehabilitating an addictive habit. But what we're actually working on now, and we just announced a few weeks ago, are screen time agents that sit at your network layer and can observe network traffic going to all your devices. And this is particularly useful both for individuals and for their families to think about holistically what it means to have the right type of content, the right time of consumption happening across all of their different devices. And that kind of breaks out of just Apple's ecosystem of what they allow us to see. Yeah, yeah, that's interesting.

3:11:46How do you think about the responsibilities of different big tech platforms? We were just pulling up this article in CNBC about this whistleblower claiming that meta failed to act to protect teens. Do you have a stance on like are the big tech platforms being negligent in what they're surfacing to their users? Or do you think it's more just like the natural forces of the economic incentives? They're trying to sell ads. How have you grappled with the various dust-ups in the big tech world over what happens on these apps? Yeah, yeah. I tend to think about no one is the boogeyman. I think actors are kind of following the incentives laid out before them.

3:12:38Our mission is really much to meet the opposite side demand. I mean, I don't know about you guys. Everyone I know hates their relationship with their phone. They hate how much time they spend on their devices. And I think what we're seeing is we think that actually equipping them to articulate that preference in terms of how much they're spending time on these platforms with technology that's sophisticatedly protecting their attention is going to actually push back against how big of an intention economy scenario can actually be downstream from people just rampantly consuming content. Yeah, yeah, that makes sense.

3:13:08um so uh how do you actually uh uh like take me through a list of like the the walls that you run into i mean all the big tech platforms are like famously walled gardens uh somebody in the chat was asking like i would love uh to be able to use youtube uh with no shorts only like long form content and um i actually installed a an extension in safari uh called social focus that allows you to do that. If you use the browser, but if you're in the app, there's nothing you can do. It sounds like you're going higher at the network traffic level a little bit. But at the same time, I don't even know, can you at the router level detect if someone's watching a short versus a long form video on YouTube that feels like that would be obfuscated?

3:13:56Yeah, yeah, that gets a little harder to do. Although we're constantly pressing at the edges of like, what is possible around that? I I mean, we've definitely ran some experiments where you can kind of fingerprint what short-form content might look like coming down the wire versus long-form content. And so there is, like, interesting things that you can start doing there. But really robustly for the mobile app, we can basically just, like, make sure that you're staying within healthy usage limits and that those aren't sliding out of control. Which, like, when shorts go wrong, what really happens is they, like, pull you into a longer session than you want to be in.

3:14:27Sure. So there's not an easy way to do that, but different platforms have different rules. Like on obviously Chrome, on the MacBook, there's a way higher ability to detect what type of stuff you're watching. Yeah, yeah. It's, I mean, it's tricky, especially as all the apps like collapse with AI. You could imagine, I mean, right now, Sora and ChatGPT are separate apps. But in many ways, they're like on the opposite ends of the spectrum. Like I want, you know, my, my, you know, son probably spending a bunch of time solving problems in Chachipiti and researching things and like finding facts and, and, you know, using it as a helpful assistant to understand the world.

3:15:07And probably very little time on Sora. Just, you know, slopping it up. But yeah. What, what, what are, what are parents of teenagers actually doing specifically with Clear Space? Like how are they utilizing it? What are best practices? Our kids are much younger, five and below. So we have probably another at least five to seven years before this is even a conversation. But I'm curious. Yeah. Some of the cool stuff that we've seen is people inviting their kids into challenges as families. So setting up incentive and reward systems. One of our most popular figures. Gambling. Gambling on screen time.

3:15:48The most American thing. Fight one addiction with the other. We hear a lot of parents set up family groups where they're doing a challenge, like a push-up to scroll challenge, where everyone in the family or squat to scroll, you have to earn every single minute you're going to spend on social media that week with a physical exercise that we validate with a machine learning verified push-up or squat. And then whoever's in the lead at the end of the week gets to decide where the family's eating out to dinner on Friday night. I think the most effective solutions we're seeing are kind of these cultural pushbacks, almost community-type stuff like the practice of Shabbat in the Jewish community where it's like 24 hours everyone's putting their phone away, and people love it.

3:16:28It's not this negative, you can't use your screens. It's like everyone's kind of buying into a new fun thing, and we think ClearSpace is the platform that can empower you to do that really quickly. You don't have to be a software engineer and know how to hack your router and know how to program all the phones. You don't have to buy a dumb phone. you can kind of still participate in the latest and greatest technologies while knowing that they're not completely zapping your entire family. Yeah, totally. Well, congratulations on the progress. I know we didn't talk too much about the business, actually more about the problems that you're solving, but, uh, it's, uh, yeah, it's a very interesting, uh, industry.

3:17:00Thank you. I'm curious. I'm curious for both of you guys, what you're doing about your screen time these days. Uh, most of the time, I mean, I don't know because all my screen time is actually really low because I'm live streaming all the time. And do I count this? Like I'm looking at a screen. I'm looking at you. The other thing I've always been frustrated with the dedicated is actually way lower than it used to be because I'm live, but that's content and I am the content. And so it's a little bit murkier, but the other thing is I was always frustrated with screen time. I I'll, I'll give a clear space a spin, but with the core screen time app, it would track like call hours as part of the screen time.

3:17:36Right. Which just makes zero sense to me. Cause I'm like oftentimes like not using my screen at all. I'm just talking with somebody. And so anyways, I just always, uh, always felt like, uh, I don't, I don't know. I think I've always been more focused on spending time on, you talked about like all calories are not, you know, created equally, but spending, spending time doing the right things. But, um, yeah, the best, the best thing I've found is just putting my phone, uh, uh, far away and, uh, just staying away from it. Yeah. Last week I spent eight hours in the maps app or something, which is like, I need to commute last map maxing.

3:18:16It was my number one used app last week. I don't know what was going on. I was driving a lot of guys. Putting the, putting the phone across the room is what we call a classic, uh, low tech solution to a high tech problem. Uh, we, we think there's an opportunity to basically deploy super intelligence at the network level at protecting your attention rather than exploiting. And that's like, we think that's what people want and that's what we're bringing to them. I'm going to really stick it to Apple and just start breaking my phone into pieces when I want to use it less. And then I got it because I'm on the whatever.

3:18:46I get the free replacements, right? So then I just go in the next day, get a new phone. And when I want some less screen time, I just break it into pieces. That's the real low-tech solution. But excited to give ClearSpace a spin and really glad you guys are working on this. It's very important that we have the smartest people in the world trying to capture as much attention as possible. And it's good to have equally smart people working on humanity's side here. So thank you. And great to meet you. Awesome. Great to meet you guys. Cheers. Talk to you soon. Let me tell you about adquick.com. Out of home advertising made easy and measurable.

3:19:23Say goodbye to the headaches of out of home advertising. Plan, buy, and measure out of home with precision. Oh, this CNBC story, Meta failed to act to protect teens. second whistleblower testified. This is from 2023. So I don't know why Adam Dell wants us to discuss this. Is there something new here? Because the CNBC story links to a Wall Street Journal article. And I was like, oh, November 2nd, it's a little bit old. But it's November 2nd of 2023. And so I don't know what the news is here. Maybe there's something new. We'll have to dig in. But we can go and take a tour of the latest in Meta's world.

3:20:00The most recent thing that I saw was that they beat the FTC case on the antitrust case that they were fighting. So things seem to be on the up and up. The latest thing from Meta on the, like, is it safe for kids stuff was from Adam Masseri at Instagram, where he was saying he's going to try and make it PG-13. He was using the MPAA rating system. And I believe that there was like some pushback from the MPAA on whether or not they could. I was saying, hey, Meta, you're rich enough. if you should buy the entire MPA, I don't even know if you can, probably nonprofit, but like I want those ratings like in every app, like just as a consumer because everyone understands it.

3:20:41You know what R rated means. You know what PG-13 means. You know what PG means. I can even tell the difference between G and PG now with the kids because PG, there might be a little bit of like a tense moment. It's just like emotionally charged. I used to think PG, it's the same stuff, but it's not. And so quantifying that, using every movie as training data, pipelining that in, and then filtering every message that gets sent into Instagram, every post. Hey, how would you rate this? Machine learning model. AGI God, personal super intelligence. Let's give every Instagram post a rating and then let the user decide, hey, I don't want to see anything above PG-13.

3:21:23I don't want to see anything R-rated. I don't want to see anything G-rated or PG-rated or anything above that. But if you could set your threshold, I think that would be very useful for parents who want parental guidance on the Meta platforms. Okay. We've had a bunch of guests back-to-back. We've also had some ads back-to-back. GetBezil.com. Shop over 26 ,500 luxury watches. Only authenticated in-house by Bezel's team of experts. Okay. We've got to talk about the Cremieux, Keon, Exchange. I thought that Cremieux was pretty fair. I think he could have gone harder. Keon said he didn't watch Cremieux's interview, that he was with a patient.

3:22:12I wish that he had, because it seems like this is one of the most important things on his plate right now is kind of getting beyond this. And ultimately, we tried to bring up as many of kind of the key concerns as possible. To be honest, it's technical enough that we don't have the same power level in terms of kind of like pushing Keon on some of these issues as Cremieux and Sichuan. Which is why I think like a lot of the debates will be done around the data in blog posts by scientists. this, but, uh, yeah. And, and, and Keon's main point that I took away was, uh, sorry, laughing at, laughing at the chat.

3:23:02Uh, but, uh, it was like, people are angry that we have the best marketing and the best science. And I, I believe that they have the most effective marketing in terms of capturing attention right now, but I don't have the confidence after that conversation that the marketing should be happening at the scale that it is. Like, I just don't, uh, I didn't, I didn't come away from that super confident that, uh, that, that Keon, uh, felt like they've done anything, anything at all that's, that's wrong. Even, even, even if you just narrow it to what there is full agreement in amongst all participants on, which is that, uh, there were reviews that were anonymized and then not disclosed to be anonymized, even if it's just that, like that is enough to, you know, if you're a customer and be like, oh, like I don't trust this anymore.

3:23:56And it's a very, very high trust environment. It's a very trust critical environment. It's not, okay, yeah, I'm buying a phone case. And like AI generated like an example of a person holding up the phone case. Like that's not what this is. This is like life, it's bio, it's really important. People are selecting, you know, impact in their future child's life. Yeah, we've talked about this before. And I think that whatever happens. It's really important to get it right. It's really important to get it right. And ultimately, people that use the service, if they have an adverse experience, they feel like the service didn't deliver or went wrong.

3:24:34They're going to come back to this. Yeah. So are there any posts that we need to read from the timeline? Sichuan Mala followed up and said the fundamental problem with Keon's inflection is that even if the origin polygenic weights can be independently validated to have the predictive accuracies claimed in their white paper, none of that changes the fact that they completely plagiarized heresy, falsely claimed that origin is novel and has superior performance, made numerous errors from typos to substantive mistakes in their white paper, have a history of making literally impossible accuracy claims, in some cases inflated 2000X to independent replication, these are not just what's up Tyler?

3:25:17you can continue, I have another post I want to talk about these are not just restricted to claims about technical accuracy, these are claims about ethics and morality for the vast majority of businesses, maybe you don't really care that much about unethical practices, typically that's fine maybe Meta does shady stuff sometimes but I still use Messenger, maybe my local grocery store manager is a wife beater, who knows, I still have to buy my groceries somewhere That's an oddly specific example. This is the example that we keep giving of like, you know, will you go change your tires if you find out that the Bridgestone Tire Company is spying on, you know, a rival tire company.

3:25:57There are certain things where it's just like if the tires are working, like you're okay with it. A lot of it depends on like, is the criticism directly in line with the company's product? Like if the CEO flubs a line and they miss earnings, but the product still delivers what it is. It's like they sell apples and the apples taste great. Like you're fine. But when they're making a claim about the actual product and then it doesn't align, And that's where people really, really start to ask questions. So closing out here, it says, but we are talking about a company that will select your future child.

3:26:38How can anyone trust a company where the CEO's first instinct when confronted with evidence-based criticism is to make false accusation of shady conspiracy theories? And Mew follows up and says, if a company engages in malpractice, e.g. plagiarism, providing products they should know are bad to customers, et cetera, is it water under the bridge if they can clean up? but that's obviously a reaction to my question was, you know, is there a redemption arc in his mind? Somebody says Volkswagen can answer this question really well. I think that's because Dieselgate is what's going on with, is that in reference to?

3:27:14Yeah. Anyway. Kermue also says, Kian alleges that he's been working on embryo services for a long time. Again, that doesn't seem surprising. I think this was always the longer term vision of the company. but Cormue says he hasn't been doing this with genomic prediction according to their lawsuit which says in 2025 Nucleus sought to offer IVF products involving embryonic DNA testing because Nucleus could not do that work itself it contracted with GP for GP to use its own embryonic genotyping products to provide test results for patients Nucleus made overtures about acquiring GP but soon it became apparent that Nucleus was looking for inroads to misappropriate.

3:27:57Yeah. Again, these, these are just, uh, allegations that, uh, we can't, uh, really validate ourselves. Um, but again, um, didn't come away from that, uh, kind of more, more confident in, in anything really. Yeah. The type form, a lot of people are saying that the type form is down. Kian was of course saying that like he will release the models and that, uh, You can go and get the models and the data from the type form. It was down at the moment he said that, but Max Glick, thank you for your service doing that reporting in the chat while we were talking about that exact thing. Max says it's back up now for what it's worth.

3:28:41And so Kermu says that's good. and I certainly hope, I just feel like the next turn of discussion needs to be, okay, we tested the models, we tested the data, we tested the claims at a higher level of rigor, I guess. Tyler, which post did you want to run to? Oh, it's at the bottom of the timeline. Szechuan Mala is also accusing Keon of using a Chad filter. This has happened before. This happened before. Sure. So when Keon came on the show maybe six months ago, Growing Daniel accused him of using a Chad filter while on the stream and went super viral. And I was kind of like, oh, like that's, I don't know.

3:29:35I don't know how to even respond to that. That's a very silly claim. I have no idea if this is real. I can't tell at this point on a Zoom call at this resolution. What do you think? Do you think this is real? Are you guys just cracking up? Does everyone think it's real? I don't think that he used a filter. I don't think he used a filter. I don't think he used a filter either. I think he just grew a beard. I think he's just been mewing maybe. Maybe he's just photogenic. Yeah, it is possible that he just flexed his jaw muscles and has low body fat. I don't know. I don't know. I feel like it would be extremely high risk to run a chin augmentation filter.

3:30:18It goes down for a second. I mean... Because you know that's what happens, right? When you're using the Snapchat filter or the TikTok filters, sometimes they pop in and out. And if they pop out, you're done. People are going to be immediately... Let's see. Compare the first two images with the X.com profile. I mean, the X.com profile, that picture looks three years old, four years old. I think on this one, Sichuan, like you might be over your skis. I don't know. We need to prove it. And then, yeah, people are really going back and forth. It's got to get the nucleus test for the GigaChad test and publicize the results.

3:30:58Everyone's cracking up in the studio. We're having a wild time. Anyway. In other news, this is actually insane. Apparently, according to X, I don't know if this is true, but the robbery that took place yesterday, in which an armed thief posed as a delivery driver and robbed somebody for$11 million of Ethereum and Bitcoin, was Lockie Groom that was targeted. Whoa, what? Which I had. No way. I didn't realize that it was him, but absolutely terrible and traumatic. And yeah, when self-custody goes wrong, but I'm glad he's okay and safe. Wow. An armed thief posing as delivery guy finessed his way into the$4.4 million mission district home shared by investor Lockie Groom.

3:31:54Yes, Sam Altman's ex-boyfriend and another tech investor named Joshua. Okay, so it was not Lockheed, but Joshua? Gary Tan posted the footage, panicked enough to delete it minutes later. Crypto security experts are now saying what everyone thinks. Self-custody is great until someone shows up your door with a fake UPS label and a Glock. San Francisco's tech leader about to hard pivot into vault custody, private security, zero public flexing because this heist wasn't random. It was a warning shot. Very ChatGPT written. Mario Nafal. but anyways very sad but glad Joshua is okay I was confused for a second that is terrible anyways thank you for tuning in today folks before we head out I gotta tell you about 8sleep.com exceptional sleep without exception fall asleep faster sleep deeper and wake up energized and I'm also gonna tell you about wander.com book a wander with inspiring views hotel great amenities dreamy beds top tier cleaning and 24-7 concierge service.

3:32:56It's a vacation home, but better, folks. Thank you for taking the time to listen to the show. Thanks for dealing with our stream issues up and down. We sorted it out. The full clips are posted. Yeah, the full interviews will be posted. Obviously, RSS feed, YouTube, and the full Keon interview has made its way to the timeline. Obviously, there's a lot of debate. We will continue covering it, but not tomorrow because we're off and not Thursday because it's Thanksgiving. We will be back on Friday for Black Friday. We have a fantastic lineup of a bunch of different entrepreneurs, e-commerce founders, brand builders.

3:33:36Some of the most savage e-commerce operators in the world. Cannot wait. It's going to be a great time. A lot of friends. Have a wonderful Thanksgiving. We are thankful for each and every one of you. Thank you for being a part of this, and we'll see you Friday. Goodbye. Cheers.