Delian Asparouhov, Michael Mignano, Chrisman Frank, Kennan Davison, Markets are Down, We Love Bubbles

29:04Anyway, fun article, good times. They talk more about the smartphone revolution. By the time Steve Jobs unveiled the first iPhone in 2007, wireless phones and the internet were already widely used. Flash memory was cheap. Computer chips were smaller and faster. Responsive touchscreens had already been invented. And when the smartphone revolution came, it was General Magic alums, Tony Fidel and Andy Rubin, who helped deliver it. Fidel helped develop the iPod and iPhone and Apple and Rubin founded Android, the startup behind the world's largest mobile operating system. And so are you familiar with the story of General Magic?

29:39It's fascinating. It was basically this dream team of all the venture capitalists came together, all the top technologists came together, and they were going to build an iPhone essentially in the mid-90s, I believe. So an early version of the smartphone was released in 1994 by a company called General Magic. Co-founder Mark Peratt envisioned digital touchscreen phones, but his device arrived years earlier. There were no digital cellular networks, Peratt recalls, to retrieve digital content, of which there was little. It had to be plugged into a dial-up modem. So they were just too early. Company doesn't work, but the team goes out and works at Apple and ultimately Google post Android acquisition.

30:20And so as hundreds of billions of dollars pour into AI, some are calling it another bubble. True or not, Perez forecasts that AI will boost productivity as the first electrical lines did when they replaced steam power. General Magic went bankrupt in 2002. Its devices were so far ahead of their time that few customers bought them. Another prescient idea it was working on would also have to wait. AI agents built to complete tasks for people. The engineer working on that project, John Giandrea, now heads AI for Apple. Interesting. Maybe they need some new blood. Maybe he needs to hang his jersey in the rafters.

31:01He's been certainly early to this stuff, but not rolling things out faster. My biggest complaint recently, we talked about the Genmoji thing, which is terrible, playground which is bad um they still haven't replaced the voice dictation like i'm i'm used to decent voice dictation now you use it a lot i use it i use a lot for chat gpt i go to chat gpt and i click the voice thing and it and it records it and it nails it every single time no matter what and then every once in a while i'll accidentally hit the button on the apple keyboard and it's just terrible and it's like apple that's not a security thing that's not it's not some crazy it's it's it's so easy to implement whisper it's like there's open source frameworks there's like they could buy a company there's a million ways to just upgrade that and just make the existing stuff better i was thinking about like how funny it is that their their apple intelligence you've seen like they like like their rewriting thing where like you you highlight stuff and then you have writing tools now have you seen this writing tools writing tools describe your change this is an apple intelligence so if you highlight some text you can go to writing tools you can say like proofread it rewrite it make it friendly professional concise like turn it into key points turn into a bullet list turn it into turn it into a table like it's cool but it's but it's weird because like there's already spell check and grammar check like running and so instead of like replacing that with one system that runs over your text now there's just two systems that are talking to it and they're like kind of fighting one's like the old school like hey we're just check and spell check here it's like the the metaphor is like there's a robot over your shoulder who's just kind of looking and say oh you misspelled this like let's underline it with the blue line you can click and you can change right um but then there's a separate robot over here saying hey actually you want to turn this into a list of bullet points like i could do that for you and it's like i kind of just want one system that i'm interacting with that i'm like really comfortable with instead of like when i want this problem i go over here it's very like fragmented anyway well time is money save both go to ramp.com easy to use corporate cards bill payments accounting and a whole lot more all in one place folks you got to get on ramp.com uh we launched our season two of the show our version two today uh we are now officially supported by ramp presented by ramp and we had talked about ramp uh but we had never shown a handshake on that we were in partnership with them, little teasers, but we never actually really told everyone that we were partnered up.

33:34We had never had a shot of us, me grabbing a briefcase out of an unmarked black van and pulling it into a yellow Ferrari and driving away. That's really what makes it sort of official. Now it's clear that, yeah. We're in the... Great car, too. Underrated. We're in the pocket of big ramp. Yeah. Big ramp. Big ramp. A lot of people have been talking about, you know, the potential monopoly, you know, positioning of ramp and big ramp. But we're conflicted out of that. We are. We are. Anyway, let's move on to another big deal. OpenAI signs a$12 billion deal with CoreWeave. They'll get an equity stake.

34:17CoreWeave, an NVIDIA-backed cloud provider, which we talked about on the show last week. They're filing to go public. We had Nick Carter, one of the first angel investors in the company on the show, which is very cool. They just signed a five-year deal to rent AI servers to OpenAI, according to a Reuters report. As part of the cloud deal, OpenAI will also get a stake in CoreWeave, expected to be worth around$350 million when the company goes public. Now, CoreWeave already has a big partnership with Microsoft, and they've signed deals to spend more than$10 billion renting AI servers through 2030.

34:50And so this is the Satya Nadella. I, you know, I own, I also like to lease, I like to rent, I like to do everything. I, you know, I'm a core customer. It all just depends on what the flavor of the week is for me. I'm good for my 85 billion. So, uh, I have another article pulled up here in 2024, Microsoft accounted for 62 % of Corby's revenue, uh, which is wild. Uh, wow. Yeah. Yeah. That's That's one of the main things that people are kind of hounding on in the S1 is revenue concentration. Yeah. Are they too concentrated? Because if Microsoft says, hey, we're out, then the company's worth, what, a tenth or something or fifth.

35:26But, you know, we'll see. Yeah. Yeah. And so in many ways, OpenAI could have continued to access CoreWeave's underlying products through Microsoft. Yep. But now they're not. Now they're becoming their own company. They're leaving the nest, spreading their wings. Yep. becoming uh all grown up yeah they're even going you do have to credit you got to credit satya and sam for publicly you know right after everybody was like oh they're beefing they're they're they're not on the same team anymore they they like went and took a picture together this was probably three months ago at this point um but jersey through it now no jersey swap okay well so it just barely counts yeah barely counts you got to do the jersey swap if you're serious about you know uh healing wounds exactly uh you know zuck and zuck and jensen seem like they're just really aligned they're not playing in each other's backyards at all it's like pure customer and video doesn't meta have a chip they're like talking about it but it's clear there's clearly still a huge nvidia buyer nvidia is not trying to do any you know nvidia does how have a cloud offering.

36:38So with the other hyperscalers, they're in some competition sometimes. Yeah, I think today actually Meta announced that they're testing a new AI chip with TSMC. So you were correct that they were respectfully just letting each other do their own thing. But now Zuck is kind of doing the same thing. Was there a Morris Chang Zuck jersey swap? Maybe that should be the thing. I'm guessing. They must have. Even if there's no photo, they probably did it. Jersey swap. Jersey swap. The Financial Times reported. And who knows, they just say they're testing it. Okay. The Financial Times reported that Microsoft cut back on some plans spending with Corweave due to delivery issues and missed deadlines.

37:20Corweave denied the report and said there have been no contract cancellations or walking away from commitments. And so that's the story of opening on Corweave. And I feel like this IPO is going to be pretty crazy because there's all these deals that are going to get papered like right before. And the future revenues and cash flows and contracts of these businesses, like the entire AI industry is kind of deciding like, hey, like we're going to spend like, you know, what I mean? The base case is like 250 billion in CapEx in one year. Right. Yeah. And so like, where does that pie get sliced up? and so if you're core weave and a couple billion dollars will materially move your you know market cap then yeah you're going to do a deal with open ai for 12 billion over yeah the timing is very convenient and give stock away and stuff so there's all these kind of like one hand washes the other type deals yeah they're just to reiterate so core weave open ai is doing this deal but then core weave is passing them back 350 million dollars in stock yeah and it's very conveniently time with core weaves ipo where the number one risk factor like you said is that the revenue concentration with microsoft yeah i feel like people will yeah my sense is that analysts will switch from revenue concentration which is still going to be a focal point to okay you're less you have less concentration going forward but open ai is losing all this money and you know it's not the most reliable customer and then they're going to still you know continue to have to fight a similar fight I do like this trend of if you spend a lot of money with a company, you get equity in it.

38:55I feel like with how much you spend at Erewhon, they should give you a slice. They should cut you in. They should give you some equity. You're telling me. You're telling me. I go to their customer support daily. Cold email. Hey, here's how much I spent in the last week. Cut me in. Think about a little pre-IPO slice. Yeah, a little pre-IPO slice. Slice me off some equity. I don't even need the shares. Just let me get an allocation. Let me get an allocation in Erewhon. I mean, LVMH should cut us in with all the Dom we're buying too. Yeah. You know, every company, if you're a good customer, let us get a taste.

39:29Anyway. Exactly. Speaking of stuff you can buy at Erewhon, there's a tour of food and drink startups in the information today. Taking through some D2C, some consumer, some CPG brands. I thought this was kind of interesting. Strategic acquirers are starved for growth. They're cash rich. And they need to innovate, says John Levert, a managing director for consumer retail at investment bank Solomon Partners. The most conflicted possible position, the guy who wants to sell all the upstart consumer brands for the most amount of money to the strategics. They have to do this. Conglomerates like Coca-Cola, PepsiCo, and Mars have long used acquisitions.

40:08You guys have so much cash. You've got to innovate. Why not buy? You've got to do it. Why not buy some of my brands, some of my clients? So they've long used acquisitions to add trendier brands popular with new sets of shoppers. And over the past few years, new food and drink brands have been able to grow sales quicker than ever using social media to reach shoppers cheaply and leaning into viral health and wellness trends. Still, big acquirers will likely be selective. To be a good candidate for an acquisition, brands need to have over$100 million in annual sales and gross margins of between 30 % and 50%, LaVert said.

40:40They should be nicely profitable on EBITDA. and if they're growing quickly, buyers typically are okay with a lower EBITDA. Some potential sellers are holding off on seeking buyers until later this year amid uncertainty around the impact of tariffs and supply chain disruptions. Selling or offloading a big stake to private equity firms could be another alternative for brands that aren't able to find a strategic buyer. And so here are the eight food and beverage startups that might get acquired in the next year or two. Banza. Banza. Banza. They raised 31 million. They were founded in 2014. It's garbanzo bean based pasta.

41:19Cool. I used to eat a lot of this. Yeah. I still have it from time to time. It's pretty good. Is the pitch low carb, lower carb than pasta? No, it's just no gluten. Oh, no gluten, gluten free. Okay. Sort of high protein. Yeah. In 2014 when they launched, this was ultra trendy as they say. uh more recently it has added products including high protein waffles uh they raised 20 million dollars in 2019 from investors including private equity firm prelude growth partners and danny mayer's investment firm smart uh they sell their products in 23 000 locations uh chomps the line of meat sticks i'm not a big chomps guy i mean how in a if i'm in like a random store maybe i'll grab one but i think they're a daily driver yeah no i i like the idea i'm almost a daily driver.

42:08Yeah. Uh, my son is an absolute chomp fiend. If I ever pull one out, he'll just come over and, and he'll just take it from me and just eat the entire thing. I mean, they're looking really strong. It's been a long road, 2012. So, I mean, they're going on 13, 14 years old. Uh, but in 2024, they did over half a billion dollars in sales. And the last disclosed valuation was 200, 300 million. And they raised 80 million. So well, well, they're Yeah, they are in the money. Stride Consumer Partners looks great on this deal. They got meat sticks, other snacks, founded by personal trainer Pete Maldonado.

42:44John had an idea this morning while we were working out to just have basically pre-cut steaks. Imagine if you could buy steak that was cooked in sort of more of like a bacon-style pre-slice form factors. You could just, instead of going for a chomp, just grab a little bit of filet mignon. yeah uh which is uh i'd like somebody in the audience to build that we'll definitely trial it well my idea was specifically like chick-fil-a but steak based so you go to the drive-thru and instead of getting some chicken nuggets you get a bunch of steak and it's like 50 bucks because it's a steak it's expensive and there's no other items and there's no other items on the menu yeah it's like i mean maybe like you get a whole steak or you get half a steak or you get little slices of steak but like it basically the restaurant just cooks steaks all day and then you drive up and you buy steaks economies of steak steak it's great anyway chomps has proven it can scale up it's on its own the brand has already expanded to most major grocery chains whole foods target kroger trader joe's as well as many convenience stores and maldonado expects it to hit a billion in retail sales this year wow that is big uh could include a strategic exit an ipo or we could continue to hold it for cash flow.

44:01Good Culture. I don't know this company. They did over 200 million. They're founded in 2014. They raised 85 million. Good Culture has been the forefront of a resurgence in the population of cottage cheese. It's like a yogurt, dairy, health, better for you kind of dairy-esque brand. Okay, cool. Do you know Lesser Evil? Are you familiar with this? 2004. Wow. Popcorn. That's an old company. 165 million dollars in sales. They raised 45.9 million. Aria Growth Partners, Valor Equity Partners is in there. That's amazing because Valor's in like SpaceX. But yeah, good team around the board, looking good.

44:42Raised money in 2023, around$19 million. And apparently they are exploring a potential sale, but also seeking a valuation of around a billion dollars. That would be a relatively rich number compared to a recent to recent snack deals in january flowers food said it would pay 795 million for simple mills which sells gluten-free versions of snacks like goldfish and wheat thins but had higher net sales the trade the basically trade of the early 2010s was just to go into a 7-eleven or a gas station and make a better for you version of every product yep every single product from meat sticks to uh wheat thins to goldfish you know all these categories it is kind of crazy that no one said like let's just do that they did everyone it was always like some random entrepreneur focusing on one single category there was no one who said like our business is we are going to create a better for you product in every single category yeah some people focus yeah some people tried to do that but you can't remember any of their names no i agree they didn't nail and it's also that's that's the thing cpg we talked about this on the show yesterday cpg is so tangible that people assume that it's very easy oh i'm gonna make a cracker i'm gonna make this drink and then you realize you actually have to the best cpg companies either got super lucky which is unreliable or they iterated across 30 plus production runs to like dial in a product and make it truly truly great and then they had to like reinvent it when they scaled up again and it's just really difficult it's basically blue collar entrepreneurship and that you know you have to go sit in grocery stores early on and just like get people to trial your product it seems crazy but um yeah it's kind of what it takes uh liquid death i mean this is another good example like liquid death super unique go-to-market super unique branding like that's not going to come out of some hold co that's just like we need better for you in every category because Liquid Death is a very bespoke, like Liquid Death is not a brand that is a goldfish, right?

46:50It doesn't translate. It's a very different thing. Liquid Death had perfect marketing market fit in a mass market product that they could sell everywhere. And they've executed that very well. They've also been very aggressive in terms of raising capital science, which is an LA-based sort of incubator that incubated it. They were also in Dollar Shave Club. That was like their first big outcome, I think in the DTC world, I was getting pitched liquid death pre-IPO round. I didn't sign any type of NDA. I think it was at close to$2 billion. I think that's completely unrealistic unless it was trading like a meme stock.

47:38Well, they did get some private credit money in. They got a$55 million working capital line from Aries management. Let's go. Let's go. Some of the best in the game. They got three or four billionaires. We got to get a private credit fund as a partner for the show. It's great. And so we'll see. We'll see where that goes. Olipop also very, very popular. They're doing 400 to 450 million in sales. They've raised 90. And the last disclosed valuation was 1.85 billion. So, wow, pulling a four or five X revenue multiple, not bad. We got JP Morgan's private capital growth equity fund, monogram, Rocana Ventures, low calorie, low sugar sodas with added fiber.

48:21It's long been seen as a candidate for buyout by a big beverage company. And they're in kind of a race against Poppy, which was launched in 2020, just three years after Olipop started. Poppy's doing more than 500 million in sales and has raised 30 million in funding. Yeah, so Poppy directly, they were also making sort of better for you-ish sodas, but then Olipop was working so well that Poppy completely cloned their product down to the font. Wow, spicy. Like it was just a complete copycat, but to their credit, they executed well and have grown sales pretty impressively. A buddy of mine is the head of growth.

49:05I actually don't know what his title is now, but he was the head of growth for olipop back around their seed round and he he's a super well connected smart guy and basically i kept back then i would i would honestly ask him i didn't really understand how hard olipop was was ripping uh this was like 2020 and i was like are you gonna look and do other things like do you want to be ahead of growth for like a cpg company like your whole life because he had like i said he had all these opportunities and he had been there for a while already he's like no like we're doing well i'm gonna stay and like i'm sure he's gonna do like really really well from this so and uh kavu consumer partners is in is in poppy which is rohan oza's fund you might have seen him on shark tank um good good guy i ran into him in beverly hills the other day uh anyway if you're building a uh consumer product a food product a beverage you're gonna need to advertise it and where should you advertise it jordy out of the home out of the home on adquick go to adquick.com it's out of home advertising made easy and measurable say goodbye to the headaches of out of home advertising only adquick combines technology out of home expertise and data to enable efficient seamless ad buying across the globe and so start a cpg company and throw it on a billboard obviously we are obviously we are partner with AdQuick and right after we launched the video this morning with Ramp we started going back and forth with Chris and Adam on the AdQuick team about our video with them so there's lots in the works very excited for that one iconic memes will be created recreated definitely to celebrate out of home advertising yeah and we wanted to celebrate some great out of home advertising uh durin uh put up a billboard that says you can't have rocket science without rock science durin's a new mining company very cool uh and jackson moses here says ads that go hard i love it right outside the spacex headquarters uh so beautiful time to mine we love we love some billboards that's actually insane alpha that you can get a billboard right in front of space and then just take the photo and spacex is right there it's really good anyway we got to move we got to move on we got 15 minutes till our first guest is joining uh have you seen megan markle's new netflix show jordy i haven't but everybody's been saying this show is one of a kind it's the best ever i don't know about the second part it's definitely one of a kind but i don't know people are saying it might be the show of the year well i don't know i'm not really equipped to judge this i don't want to watch a lot of cooking shows but i watched like five minutes of it and it was atrocious oh it was really really rough really really rough but you know i me dragging it is nothing compared to what the economist did it was one of the roughest articles i was laughing out loud and i said i want to read some of it here because uh the economist is one of those one of those journalism outfits that has just an incredible command over the english language and can body someone in the most basically pseudonymous or not pseudonymous Yeah, it's an anonymous writer.

52:22And it's hilarious. So I'll read some of this. One scene is magical. Another is so pretty. Another delightful. Welcome to With Love with Megan, Megan Markle's new cookery and lifestyle show in which she smiles at things in Montecito. In episode one, she smiles at raspberries on a cake. In another episode, she smiles at hydrangeas. She also smiles at bees whose hives she keeps on her property. Quote, when i think of honey i think of bees she says in one of the many insights with which the show brims just like wow when i think of honey i think of bees just like these are the type of insights you're getting from this show uh there have been doubts about whether netflix was right we talked about bees and honey on this show before we did and john didn't believe that she's more of an expert than i am john didn't believe that bees ate their own honey i do Turns out they do.

53:14They do. There have been doubts about whether Netflix was right to fork out a reported$100 million in a deal with Ms. Markle and her husband, Prince Harry, for this show and other content. Such doubts must now be dispelled. However, Ms. Markle is not just smiling. She's on a mission. As she explains, she wishes to share some little tips and tricks for entertaining friends and elevating one's life. such as perhaps make sure to member little tips and tricks such as perhaps make sure to marry a member of the british royal family wow we've been saying this we've been married into royalty yes hot tip uh that that tends to help to no end or ensure you get netflix to pay you a vast sum to show off an immense property complete with a vegetable garden beehives and chickens to lay fresh eggs that helps too uh this new eight episode netflix show released on march 4th is more or less Martha Stewart for the 0.01%, but aimed at the other 99.99%.

54:09In it, she offers indispensable tips, such as how to make candles with your own beeswax or how to boil noodles with tomatoes. Apparently, first you put the noodles in a pan, then you put in water, then you take off the lid, then the water will evaporate, then they are done. At last, everyone had been wondering destroyed destroyed like it's just this is such good right i love i love it so much um it's just it's just so funny anyway uh it's it's a lot of fun she has not created a lot of fans no no decade miss markle says that she is not in the pursuit of perfection but in the pursuit of joy this is charming if not precisely the wording that some inside the palace use their descriptions of her tend to go a little heavier on words like abrasive bullying difficult and rude but then perhaps those palace workers did not step to did not stop to smell and smile at the hydrangeas that's so funny uh miss markle uh we're not far from yeah montecito we'll come up we'll come up we will show you how we drink uh dom yeah proper etiquette if you're celebrating a podcast milestone yes she had a podcast uh on spotify big deal and i heard through the grapevine that her one request was that there was quote unquote no homework no way oh yeah yeah she just wanted to show up and do it i mean this is unsubstantiated rumor but uh the rumor was that at a certain point she wasn't david senra will love this we and has clipped him.

55:50She wasn't even doing the interviews. So imagine it's like, we're going to have someone on, we're going to have like a, like an assistant, ask them the questions, record their answers. And then I will come in once a month and record all the questions. So I come in and I say, Barack Obama, what was it like being president? Tony Blair, what was it like being prime minister? And then I come in and say, you know, like, you know, whoever else like is, is on this week, uh you know martha stewart uh what's your favorite recipe i come in i record those lines and then they cut it together with the answers where that person got interviewed by someone else insane it's like the lowest effort podcasting uh and that's why he's no longer a podcaster that's crazy david senra rolling over just ripping his hair out thinking about the lowest effort podcasting you possibly do brutal anyway uh the one my main takeaway from the show is that montecito is beautiful.

56:47We should spend more time there. And there's no better way to do that than on Wander. That's right. Find your happy place. Find your happy place. Go to wander.com. Book a wander with inspiring views, hotel-grade amenities, dreamy beds, top-tier cleaning, and 24-7 concierge service. It's a vacation home, but better. Jordy, do you have a code for folks at home? I got a code for us. It's wander.com slash tbpn. You can use the code tbpn to get a discount if you're booking a trip and just by creating an account you can uh get uh entered into a giveaway that they're just doing for tvpn listeners so you're only competing with other brothers which is kind of a win-win situation so either you win a free trip or another one of your brothers wins uh so there's zero downside fantastic enter now and uh you know take it take a crack at it I love it.

57:44Let's do some timeline. We have 10 minutes until our first guest. And I want to kick off with a post from Bezel. We're going back to back with the advertisements today. But this is a great post. Sold and authenticated by Bezel. All long and Sone long one time zone. Reference 136029. Two time zones. Day night indicators. Zero guesswork. If you're crossing continents, this Lange ensures you never call the wrong person at 3 a.m. Beautiful watch. Flip it over and things intensify. It's manually wound L141.1 movement is pure German engineering flex, visible through a sapphire case back, hand engraved balance cock, 72 hour power reserve.

58:29You hesitated there slightly because that sounds vulgar, but it's just watch terminology. 72 hour power reserve and enough finishing to make any watch nerd emotional uh fancy a longer of your own good taste better news we've got more hit the link in bio to shop bezel's full selection this is screaming zuck to me oh yeah i might have snapped this up he might have yeah obviously they have a lot of private you know clients they can't you know share yeah but uh this seems like up his alley anyway go to bez go to get bezel.com shop over 23 500 luxury watches fully authenticated in-house by bezel's team of experts download the app scroll and have fun uh should we move on to lulu i just got to say when we when we do our bezel partnership video multiple watches we need a shot of both of us all the watches just wearing watches all the way up to the shoulders yeah yeah we we gotta get the the graph diamonds hallucination yeah get one of those going a couple pateks yeah how much would it cost to just get a graph diamonds hallucination for depends on what the market's doing it you buy it and then you sell it at a higher price you made that smart yeah look at you possible course coming soon course going soon uh coogan's code anyway lulu uh misservi posts just went to the dmv they've replaced the take a number take a dispenser with a person at a booth and you get a ticket you have to line and to get a ticket you have to line up and when it's your turn ask the person to give you a ticket this is so funny AI mogging mogging computers and artificial artificial intelligence you know I mean when when mid-journey came out and everyone was like oh this is going to destroy artists I was like there's still courtroom illustrators who like draw pictures of like sbf sitting there and like we have cameras they could just take a photo yeah and yet like somehow that job like did not get destroyed by technology and so there are plenty of jobs that are super resistant i didn't i didn't understand third-party dmv services until i was probably 22 break those down well pretty much there's only a handful of things that you need to actually go to the DMV for.

1:00:44And then the vast majority of them, you can pay a third party DMV$50 to do it with just over text and they just send it to you. It's great. Um, I bought a car recently and the title, like, you know, got registered under my name, but then the title, uh, never got sent to me. And, uh, I just texted my DMV person and they're like oh yeah just like send me a hundred bucks and it'll be there in like two weeks that's great and i don't have to touch it at all so huge alpha my dad was a very uh practical uh is a very practical pragmatic guy he goes and sits in the line but he's retired now yeah so i always think of the dmv as a good example of uh gelman amnesia which we talked about in the last thing is like it's very very ridiculous over the top like mental model but uh gelman amnesia i i like it because the whole thesis is like once you realize that one thing is incorrect like you're reading you're reading an article in a in like you're listening to this show and you hear us talking about your your point of expertise and you realize we don't know what we're talking about and then you assume that we don't know our what we're talking about about anything and you're probably right um uh the dmv is a great insight into like how the government works in the sense that like everyone's like oh man the dmv is so bad and so inefficient uh but i'm sure the nih is fine or i'm sure the dod works great i'm sure the you know the other arms of the government are fantastic and it's like no actually like the dmv is par for the course like your experience of the dmv is the exact same experience you'll have doing business with the fda doing business with the dd doing business with like any any arm of the government it's kind of all the same um but it but the dmv is the one that you know the average citizen interact interfaces with the most yeah um and so So yeah, anyway.

1:02:35Big news. Robinson Helicopter Company has released a new helicopter. We've been waiting for this. They haven't released a new helicopter for a very long time. The R88 reveal trailer is now available to watch on YouTube. Go check it out. Very cool video. Can we pull it up? We wanted flying cars. We got new helicopters from Robinson Helicopter Company. We wanted flying cars. We already had helicopters. I mean, really, just a skill issue. Why don't we just put wheels on the helicopters? Yes. It seems pretty easy to do. yeah with little electric motors in each wheel yeah be fine probably get up to like 30 40 i i really check it out if you can you play this let's see um yeah i mean i really feel like uh the whole flying car thing a lot of those a lot of those companies like we were talking about kitty hawk the google founders had trouble they couldn't get through all the regulatory uh it'd be very interesting to see someone try and take like a much more iterative iterative approach and just take a helicopter modify it and do just the minimum i mean this is what we saw with the sea glider thing where you got to find the regulatory hack anyway aussie hexes nice machine i like nice machine 53 views just showing up i mean the robinson helicopter company they have a check mark so they are verified on x but they still posted a link got 3 000 views fortunately we're featuring it here we'll try and get you some amplification and uh yeah send us more footage robinson we'll check it out we'll review it on the show yeah we got to give them a master class in the vibe reel yes exactly this should have been this should have been native you should have posted it native could it could have had a banger could have had a banger gone viral I don't know.

1:04:10I don't know how we're doing on this, but let's see who we got.

1:04:17Okay. We got a bunch of stuff here. Let's move on to Jack Raines. Let's do it. Jack Raines went on the AdQuick podcast. We love AdQuick. We love Jack. Let's go. Very funny. He was previously joking that OnlyFans is the best way to get your message out, but now he's advocating for LinkedIn. He says with revenues higher than Pinterest, Reddit and Snapchat combined, LinkedIn is still ultimately number one for cringe. Number one. Number one for cringe. We've been getting active on LinkedIn. We are, go follow us. If you go to tbpn.com, you can follow our LinkedIn account. Yeah. And we're starting to share.

1:04:59We're staying true to our X roots by posting the LinkedIn content like two weeks later. Yep. You know, standing, you know, honoring X. being where, you know, the everything app, where, where the most important conversations happen, but LinkedIn, you know, you can, it's more like a greatest hits. I don't want to like, I don't want to pat ourselves on the back too much, but, um, we do that often and it's actually part of the brand. So, um, but, but, but, but I, I do, I do like the strategy of, of just posting interview clips on our LinkedIn. It feels like the least cringe thing to do. Like we tried to take, I tried to take one of my, like, like sound bites from the show and turn it into text and put it on LinkedIn and be like serious.

1:05:37And it's just like, didn't feel right to me for some reason. Yeah. And I remember when we did our first launch video, the thing LinkedIn doesn't understand is, is humor and satire. So we did our first launch video and people's reaction when they would talk to me about it as they were like, super cool video, dude, like looked very serious. Yeah. Everyone on X got it. Everyone on X got it. Yeah. It was ironic. Anyway, let's, let's get away from the irony get away from the jokes we have to talk about this story this has been shaking up tech lamborghini just announced a five thousand dollar baby stroller uh this is huge for the pro natalist crowd huge for the yeah this was a lot of people's final excuse they were like you know i want to have children exactly i've been planning for this for a while but all the strollers are so cringe exactly the babies are surprisingly heavy it's like carrying around once they you know get a few months old it's like carrying around a 25 pound dumbbell yep you know everywhere but you know it's it's not even as easy to carry as a dumbbell i mean i gotta say like lamborghini really did not bring their design aesthetic to this at all it's super disappointing it just looks like a normal stroller to me the only thing is maybe it's it's it feels super like something i don't like about strollers is because they're made of a lot of plastic yeah they don't feel always this looks like there's some metal in there i see some shine on there um if they have carbon fiber accents it needs carbon fiber i would even i would even like imagine if they had the the rear view mirrors on it cool like that could be cool too yeah yeah yeah but i'm thinking like sharp angles i'm thinking like yeah you know reventon yeah the one where they take the event door and they make it even crazier like even more aggressive yeah uh yeah i'm gonna give this a four out of 10.

1:07:22Four out of 10. Okay. Well, it is 1245. We should have our first call in Ben, make sure we have pulled up the, uh, the zoom and see if we can have our guests join us. Um, how we doing? Hey, can you guys hear me? I can hear you. Awesome. How you doing? I have a video on too, but fantastic. Yeah. We can see you. No, this is great. Yeah. We can see you cool so uh ken davison is here uh from icon uh big announcement today can you break it down for us what are you announcing and give us a little backstory on your product uh what you're building how it's going just from the top sounds good um yeah so we we just announced a second round from founders fund um i'm the founder of icon and basically what we're doing is we're helping brands make uh much much better ads with uh this thing we're calling the the ai ad maker And high level, what we do is we take someone's like big content library and then we turn it into hundreds of ads.

1:08:21Cool. Do you have any good like case studies or examples from companies that are used to it? I think Ridge, wasn't Ridge? Sean Frank was on the show less than two weeks ago. And I think he was one of your guys' super early partners. Yeah, yeah. We built a lot of Icon with Sean and then Ron and Otvi and a lot of other folks in the community. Basically, what we're doing is we're tackling like nine different problems at once. So we help with script writing and that script writing where we're helping you like target a specific audience. Sure. And then once you have that script where we're taking your library and then matching it with that script so you don't have to do that by hand.

1:08:58On top of that, we also do analytics. We help you like keep an eye on competitors. Like we help you even like launch ads on on many different channels. There's there's all these pieces of that making puzzle that we're taking on. and it's very manual today. So we're solving that. Do you like competitive markets? Previously, you started Skio. Subscription management within e-com is deeply competitive. I'm actually a co-founder of this company, Rora. And Rora was running on some other subscription management platform, but I actually messaged the CEO just before this, Brian Keller, and he said, we're switching over.

1:09:35Skio is just a far superior platform than the others. Let's go. So great, great review for Skio. But my big question is, is you clearly love competition because to go into subscription management, dominate, and then come in and do Icon, which is a very obvious idea. And many people are trying to tackle it, but it's very difficult to do well. Is competition something that you're sort of seeking out in some way because you just know you can do it better? Yeah, definitely. As you said, Skio was a really competitive space. There's at least 10 subscription apps. And yeah, we tackled it with one, like a really like engineering first culture.

1:10:14But two, also just like a really like playful personality. I think we really like try to be real with our customer rather than corporate. And I think that resonates really well with the community. And we're bringing a similar approach to Icon. We're working seven days a week. We're really like pouring our heart into this. And I think it resonates really well with the type of customer we're going for. Can you break down in terms of where AI lives within the ad stack? There's so many places from generate a script, generate an AI voiceover, generate a deep fake of a UGC customer or even the CEO or something like that to AI assembly and picking which clips go where.

1:10:59A lot of these could be done programmatically or deterministically. A lot of them could be done with AI approaches. What do you see working well? Where's the highest leverage point to inject AI? Yeah, so I think a really common mistake is thinking AI is just going to generate the ad and then you're not going to have to do anything at all. Really, the way I see us is basically cursor for ads where we're trying to like take the editor, the creative strategist, anyone involved in the ad making process and just make them a lot faster, like remove the work they don't want to do, right? So with the script writing previously, right?

1:11:32I'm sure everyone knows this, but you can get some writer's block when you're trying to like pump out 100 ads a week, right? So one of the things we're doing is we're looking at your previously run ads. We're looking at trending like concepts on the internet. And then we're like doing all of that behind the scenes and helping you steer that. Like you're able to write in first or third person. You're able to like say, don't make a medical claim or something. Like really it's up to the user. And as a result, you're just a lot quicker. Is there some sort of concept of like temperature? I remember in like the early GPTs, like you could kind of turn up the temperature and get a little bit crazier.

1:12:06Because I feel like I could immediately imagine any of the LLMs kind of just like re-paraphrasing the same value propaganda again and again. But maybe some of the value is actually, hey, let's think of new ideas that then we can test. And that's where like the real alpha is going to come. Hey, we never thought to make this type of claim. It's not a medical claim. We didn't cross any lines. But we never really knew that that was what the customer wanted. Do you have some sort of a way to dial that in? Yeah. Yeah. So you're able to use our thing called adGBT, very similar to chatGBT, but for ads.

1:12:40And the key thing with it is you can really just steer it in the direction you want to go. There are people who want 100 permutations of their winning ad. That's a really common use case. We also have people who want to just do 100 different concepts at once, right? So it's really like pick your own adventure sort of thing. And we just help you do that a lot quicker. Got it. I have a question. So for the last five years, the meta on the meta ads platform has just been meta is really good at like finding you the right customers. So you should focus on creative. That's part of the opportunity that you have with icon.

1:13:15Is there a world you do you imagine a future where meta tries to almost like move up the stack and get into the area that you're in? Obviously, you're not afraid of competition. But you know, how do you think about sort of meta getting in this game uh yeah yeah there's definitely some stuff that's more uh in the pocket but uh what i can say here is that we're we're going to be like platform agnostic right so um you you can run ads on meta you can run run ads on tiktok like like imagine 10 different platforms right like i don't think meta is gonna like want you to like run a tiktok ad or or different platforms that of course we can't rule that out right but they're like five of those like misalignments i'd say um for meta to to be doing something like this and they'll therefore have to keep in the pocket but i'm pretty excited uh to partner with them and yeah just see where this goes awesome well you have to come back on when you can share on that i yeah i yeah i i i mean any anytime i have an ai founder on i have just a bunch of questions like uh you know what's hot what's trending like mcp does that mean anything is that legit and real um what other like uh what other kind of like foundational developments are you watching for the the give me a deep seek take give me a scaling take give me whatever you got yeah i wanted to bring this up in a few of our other trends of thoughts earlier um one of the things that we're really like approaching this with is like we want to like pick the best like like uh model for the the problem right so one of the things we do is like ugc like ugc lip syncing right sure i'll be really candid it's not quite there yet um in terms of replacing normal UGC.

1:14:54That's why we're taking existing content and repurposing it. But we've definitely got our eyes on it. I'd say Heyjen, Tavis, there's like 10 players in this space. And we're just going to partner with the best one. And we use a combination of them today already. So that's kind of the way to think about Icon. We're taking the best voice vendor, we're taking the best video UGC vendor, the best writing. We're using a lot of Claude underneath but like with like a lot of code on top right so yeah it's really how do you yeah how do you think about you know cost uh reduction at uh at kind of the infraslayer you yeah you said you've gone from zero to five million in ARR in 30 days you're extremely profitable uh it sounds like you know costs aren't a big issue at the moment you know you guys are running pretty efficiently but uh presumably it will only get better so it sounds like you're in a good spot Yeah.

1:15:48Yeah. I think another thing that's really fun about this is there's a lot of people in this space that are basically operating on 90 % margin. They're really charging a lot for what they're doing. And part of the reason we're being so disruptive here is we're charging 10 % of what they're charging. And I want to pass the savings to the customers as the costs get better underneath. I think companies are either going to have to adapt with their pricing or they're going to die. that makes sense uh what what's the actual you you're going for the record uh to beat every company ever on the one to 100 million ar record which is less than 12 months do you know the actual day uh are you just are you just going to do it in 12 months well i'd like to hit it in nine months um like not leave it too close but i will have to see is there a scenario where at the last on the last day you have to bump prices like 30 just to hit the mark or you or you think there's enough customers out there at the the current pricing that that you can get in front of because i feel like e-commerce is very uh the top e-commerce founders and cmos are all talking to each other there's almost like you know uh sean frank and connor mcdonald have their podcast i think i think like you know probably uh an important acquisition channel for you guys but um But yeah, you seem pretty confident.

1:17:09We'd love to do a check-in call in maybe six months and see where we're at. Let's see it. Throw the gauntlet down. I want to see the row we're on. Let's do it. Yeah, part of the reason I'm doing this is it really pressures me and the team in a good way, I think. I don't want to let everyone down, so it keeps me working pretty hard. But yeah, if you think about it, we've got a business plan that's 1 ,000 a month. it's only 8 ,300 customers we need to get to 100 million, right? And like keeping the numbers a bit more private, but we're more than a thousand already. So I, yeah, we'll see six to nine months from now.

1:17:44Yeah. 8 ,300 customers. These are businesses. I mean, meta has what, like a million businesses probably advertising at a significant level. Yeah. It's, it's not insane, insane penetration to get there. So good luck. I love that. That's amazing. Well, we'll let you get to your next meeting i know you got to jump uh but thanks so much for calling in please let me know when you have uh news or announcements next and we'll bring you back on yeah congrats on the progress and then you're out talk to you soon bye cheers okay bye cool to move on with more timeline jordy let's do it let's run through a couple well elad gill has reported that dropbox has converted from delaware to a nevada corporation uh lots of people talking about the risks of being in Delaware.

1:18:28Uh, interestingly, I don't know exactly what triggered this. We should get the Drew Houston, the Dropbox founder on to talk about like how he's thinking about his business because Dropbox was one of those companies came out of YC, I believe. Yeah. Well, yeah. YC company got to unicorn, almost Decacorn status was super legit, goes public, really big, but then just kind of stays. Well, they hired 300 ,000 people, right? No, that's DocuSign. That's a different company. they're they they the the name uh yeah wait did you really confuse it yeah yeah no no no no no it's Dropbox uh I mean Dropbox has like fascinating engineering culture they hired Guido Van Rossum for a while do you know who Guido Van Rossum is the creator of the Python programming language to be clear Dropbox still has I think more employees than X really uh yeah I mean, they were one of the hottest startups, then have been kind of a, what do they call it, like a store of value type company.

1:19:31If you bought$1 ,000 in Dropbox five years ago, it's still$1 ,000 today or something. The stock's been kind of flat. But I mean, it's a fascinating founder story of building a multi-billion dollar company and not many people can say that they've done it. So I respect. I was wrong. X has 2 ,800 employees. Dropbox has 2 ,200. They've been getting 2200. And what does DocuSign have? Because Dropbox acquired HelloSign, which is a DocuSign competitor. DocuSign has 6 ,700. Let's go. Hit the size gong for that. The size gong for DocuSign. Headcount's still cool. A lot of people says, hey, you shouldn't celebrate headcount.

1:20:13It's not a real metric. I'm a job creator. I'm a job creator. Job creation. DocuSign is going to get the craziest corrupt bargain from Trump. be like, well, you're employing half of America. Like, what do you want? DocuSign is going to decide whether or not there's tariffs or taxes. They're just going to write the policy and it's going to get ironed in because they're creating so many jobs. Every politician will love them. There should be a founder that comes out and says, my entire mission is to create jobs. If we have 0.01 % profit margins and we can add, I will just keep dividing that 0.01 % as many times as possible to just get each incremental employee.

1:20:56Dropbox, fantastic story. You know the story of their viral growth too? They were very, very early at being very intentional about distribution baked into the product. So when you would sign up for Dropbox, they would give you like one gig of space to store files in the cloud. But then if I referred you, you would get an extra gig of space and I would get an extra gig of space. And so it went super viral on college campuses. And they really did a good job of that viral marketing model that so many companies tried to copy after Dropbox was successful, but it gets harder and harder over time. But it makes a ton of sense.

1:21:35It's the same Gmail model that worked. Anyway, speaking of legendary Silicon Valley startups changing things around, uh asana ceo dustin moskovitz is retiring what did the stock do and i mean young guy down 24 really oh but it could be it was like a crazy day in the markets no no no but that's it was very clearly because of him because of him stuff but i mean what hey as a ceo you want your stop to stock to drop tremendously when you announce your retirement because that is your market value. I wonder, I wonder how much of his net worth was in Asana versus Facebook because he was a Facebook co-founder.

1:22:20And so you're looking at a trillion dollar company, even if you got 1%, you know, you're in the multi billions. I'm sure there's dilution in sales and stuff, but still it's like, there's so many, there's so many things where, you know, it's, it's a, it's a big, big shoes to fill when you're on your second company and your first one's Facebook. But, uh, I don't know. I used Asana for a while, nice product. And, uh, you know, Dustin, come on the show now that you're on Retired. Let's talk about what you want to do with all that money now that you're retired. We'll get you a nice watch on bezel. We'll get you an eight sleep.

1:22:49We'll get you a nice wander vacation every once in a while. Trey in the chat, there was some Rolex leaks around their new 2025 models. Oh, I heard about this. And they're allegedly introducing a land dweller. Trey says it's a perfect watch for VCs. Really? Why? Yeah. Well, obviously, they just mostly dwell on land. Yeah, yeah, yeah. if you're enough of a size lord you start to be more of a sky dweller that's great but uh it takes a little bit okay um do we have our next call in for the this stream i know we are going uh we're supposed to be going live at 1 p.m i don't like doxing the the guests too frequently hey there we go hey hey good to see you guys welcome to the show Yeah, welcome to the show.

1:23:39It's great to have you, Chrisman. I don't know why I messaged you yesterday or it was maybe the day before, but I was just like, dude, you got to come on. John and I are dads. You're building products that our children will ultimately use. I don't know if they're quite old enough yet, but I've got a bunch of buddies that are on Synthesis for their kids and have said great things. I wanted to have you on. Let's start with just a high-level intro, who you are, what your company does, set us up for the viewers, and then we'll just ask a bunch of questions. Yeah, yeah. I think, by the way, it was like 9 or 10 p.m.

1:24:17last night that you messaged me. So yeah, definitely. Thanks for the advance notice. But yeah, happy to come on. I was maybe in a similar position to you guys like five years ago. My oldest son was two. I went down to visit the school at SpaceX that Elon had created for his own kids. He hired a teacher out of the fancy private school in LA and started his own school at SpaceX. And the guy he hired, Josh Don, became a friend of mine. And we ended up starting a company together to kind of scale up the best parts of that school. So we started during COVID. The initial product was this thing that really capture my imagination.

1:25:00I went to the school, which, you know, I was at a company education company called Class Dojo, which went from, you know, zero to a billion dollars. I was the first employee there. And, you know, the, what they did at the SpaceX school looked a lot like what we were doing to build that company. The kids were just working together to solve problems in the form of games. And so we took that approach, put that on the internet and signed up kids from all around the world, you know, it kind of took off. So that was our initial product. And now, you know, We have built an AI math tutor that I think is taken off pretty well and I think is going to be a major part of every kid's education in the future.

1:25:40Yeah. Companies love synthesis. Yeah, that's where we are. Yeah, so right now you have the subscription. What does synthesis look like long term? Starting digital makes a lot of sense, but over time is there desire to kind of almost verticalize and go into the real world or what does that look like? I don't know about going into the real world. I think it's, there've been some, you know, Silicon Valley startups that have been really well funded that tried to do the software piece and the real world piece at the same time. I think it's really hard to pull off both. Like if you're going into the real world for schools, you're doing like a real estate play essentially.

1:26:17And, and, you know, I think when it comes to learning, you know, math, science, engineering, the fundamentals, these are, this is information. And so information can be transmitted through computers in a lot of ways better than a human can do it. And so I think if we want to reach a billion kids, then it makes sense to go vertical, but within software, like things that can be delivered purely software. Never say never because it is attractive to the idea of opening up physical in-person schools. If we did something like that, we'd probably do something like an academy. I always admire the European soccer clubs.

1:26:56what they do is they'll have an academy attached to all their professional teams and they'll bring kids in at like age six or eight. There's a guy who's a star now for Barcelona that they brought in at eight years old. And now he's like 18 and he's just, he's amazing. I think if you really want like incredible performance, then you should do that kind of like focus on the elite. So we might do one of those in like every city. We talked about the kids with the most potential. Yeah. We talked about a Teal fellowship for middle schoolers, you know, just like you just go further, further downstream, get the middle.

1:27:23You could basically be that guy of getting the middle schooler to drop out of their regular or elementary school and be like, come to the synthesis institution, academy. That's exactly – if we do go in person, that's what we're going to do. I think that will just make a lot of people upset. But I think it's actually the right thing to do. I think you can identify kids who have potential engineering talent pretty early. And if you develop that, this is, it's like, this is what they do for sports. And so like, if we're looking at people who can actually advance civilization, you know, we should have something that's at least as serious as what we do for sports.

1:28:02Yeah. What is, what is 10 years from now, what is sort of K through 12 going to look like? My, my sort of personal experience with school was interesting. I started at a Waldorf school. That was like my earliest memories of school. I think I benefited a lot from it. but they didn't really teach me to read until I was in the third grade. And I was like conscious enough to tell, complain to my parents and be like, mom and dad, like I want to learn to read like the other kids, like, you know, so I ended up going to a regular elementary school. And then by high school, my father was actually a math teacher at my high school.

1:28:38And I hated high school so much that I like graduated early. So like my, my, and then, and then by college, I was just like focused on startup stuff. So my, I didn't feel like I had a great experience with my education. How much better can it be? And sort of what's your broader vision? Obviously, synthesis can be a big part of a child and a kid's education. But, you know, what is the full stack look like in the future? Yeah, yeah. That's funny. I also had a bad experience with my education. And it's, you know, I got like psyoped into, you know, devoting the rest of my life to changing the whole system because I hated it so much.

1:29:16So maybe it was similar to you in that regard. I think the big problem is you start with this. Originally, elite education is with one-on-one tutors. I don't know, but I don't think it was like eight hours a day plus homework with one-on-one tutors. I think you can learn a lot more efficiently than that. Then you have the one-room schoolhouses, which again, kids are working on the farm, and then they come to the schoolhouse a couple hours a day, maybe a couple times a week, and that's it. And then all the parents go to work and the school day expands. And instead of just sticking to that, like, well, we'll teach a little bit and then we'll kind of have fun for the rest of the day.

1:29:51They just expanded the teaching to make it somehow encompass all the hours from like 8 to 3, 8 a.m. to 3 p.m. and homework. And I think what we're going to see, I think AI tutors are going to drive this. I think you could actually learn 20 to 30x faster. I don't think there's going to be a need for any homework. I think kids are just going to use AI tutors to learn the fundamentals and hopefully a lot beyond that or what their interests are. My hope is the rest of the day is spent in ways that we can't imagine. Like there's just like in your life, there's an infinite number of things you can do and ways you can spend your time.

1:30:25And the same is true of kids. So we should spend a little bit of time teaching them the fundamentals so that they can have good ideas and find what they're interested in. And then I don't know what they should be doing. My kids go to like a charter school two days a week where they build bridges. They do school plays. They do all these kind of things that you're not going to do with. It's not just software and like it's not just reading. And so I'd love to see a lot more of that. Our goal is like be the partner with every in-person school that does that. And, you know, hopefully there's a lot of just local creativity and exploration.

1:30:57Right. Because kids have a tough job. They have to figure out what they want to do in life. And it's a hard problem in the modern world. It's hard to say, I want to be a doctor or I want to be something specific like that because careers get more and more creative. And so I think it's important for kids to have that time to explore. Can you take me on a little tour of where the government's doing things that are great for education of the next generation, where things could be improved, how charter schools fit into that, how public funding fits into that? Just kind of like what's your world model for public-private partnership in educating the next generation?

1:31:37there's some really exciting stuff going on now which um i don't know because i had ryan dealt from primer on but he's done some work in like kind of lobbying uh governments in florida for increased school choice which is like so i think a lot of people don't know um in california for example it costs like twenty thousand dollars a year uh to put a kid through the public school system which is just like an extreme amount of money and uh that's a little bit higher than the national average, but not by much. And so what a lot of states are trying to do is say, you can take that money with you and go choose a different school.

1:32:09And so that creates like the government, whether it's usually like the local government collecting taxes, paying for the education, but then there's this fierce competition, right? Like somebody can open up a school right next door, bad schools can fail, bad teachers, bad principals can go out of business. And there's going to be a lot more creativity in that regard. I think that's maybe one of the most exciting things that government can do because I think, you know, then, then you would be as well served by education as people are served by like grocery stores and they'll just be, you know, kind of wild, like cutthroat competition and people trying to do interesting things to, to attract students and get results.

1:32:45So I think that's, that's one place where the government can do something really great just by letting the, you know, bringing this like kind of consumer mentality into what's typically been a government monopoly. So schools could get, you know, you'd be as well served as grocery stores as opposed to what it is now, which is like the DMV, right? Sure. Yeah. Uh, does all, uh, K through 12 education over time start to look more and more, uh, like a video game. Cause like one, one concern I have right now is that, uh, kids when they're out of school, they're doing Roblox, they're watching Tik TOKs and then you put them in a classroom or you give them homework that's sort of built around this sort of old style philosophy around learning, which is like, you know, writing things down and, you know, here's this textbook and we're going to read a chapter out of it or things like that.

1:33:37To me, it seems like kind of an impossible uphill battle to try to get a kid to pay attention to that when outside of class or even on their phone in the classroom, they have this sort of consistent, really intense stimulation. So in order to compete, does education need to start looking more like what's on their phone in their sort of leisure time? Or how do you think about that? I think those are, I mean, I know this is like on people's minds. I think they're less related than people think. I think, you know, TikTok and these things are addicting. But also school is just terrible. Like it was terrible when we were kids and we didn't have TikTok.

1:34:17uh right so i think i think regardless of what's going on in the rest of the world um you want to make the tools for learning as effective and as engaging as possible it's a really tight balance that you have to strike when you're building products like for us there's you know there's things like duolingo which famously you know it's maybe really good at getting their early retention and engagement but but you know hardly anybody knows someone who's learned a language from Duolingo. So they kind of focus all the way on the engagement and gamification and not so much on the effectiveness. And then, you know, you can go the other way where it's like, well, theoretically, if kids would spend a lot of time on this, they would learn, but they won't do it.

1:34:56And I think the right products, it's going to be, you know, just a balance of those kind of things. And I think if you get it right, you know, something a lot of people miss is kids, they want to learn when you really learn something, you rock a new idea, it makes you more powerful. and you can feel that. And I think it's especially true in math, but I think that's true in all subjects. If you want them to learn something, it's because you're trying to make them more powerful. I think what a lot of teachers do is say, well, this will become useful to get to the next level of school. And that's not terribly motivating.

1:35:29What we try to do is just show you these ideas make you a more powerful thinker in the moment. And I think kids are pretty motivated. uh they're pretty motivated by that um so yeah yeah that makes sense uh last question i really have today and would love to have you back on in the future uh just as you know this sort of uh industry uh develops but uh we had talked before when the humane ai pin came out i think everybody that was intelligent in the tech industry generally looked at it and said this is not going to replace my phone because it does a lot of the same things it doesn't necessarily do them better.

1:36:06But our reaction at the time was that this is not going to replace my phone, but maybe this is a solution that my kid would use where like, I want like location tracking and I want, you know, them to be able to easily call me, but I don't want them to be on a screen. Have you thought, and so as like all these AI pins sort of evolved, there was the rabbit, there was humane, there were some others. My immediate thought was maybe they're focused on the wrong user type. Maybe there's a market for this with kids who if you gave them something that they could ask any question in the world to and was sort of like this sort of companion maybe that could be cool uh have you guys thought at all about sort of hardware experiences i know you're very focused on delivering these sort of digital experiences but has that you know ever been even a conversation we we haven't talked about it at all i mean like my kids have like the um it's not apple watch but it's like a knockoff like watch brand that like tracks it look yeah they can talk to you and that of stuff and i i assume you know they'll be able to connect to the internet and use the use ai for for questions and that kind of thing i think um i i think like for learning screens are like extraordinarily powerful like you can simulate almost anything on a screen and uh yeah that's like underrated you know i i think people like don't realize how amazing that is there's a lot of luddites and who are like you know there's just something about learning on paper like reading a book on paper and like i just don't agree with any of that at all i just It's like information.

1:37:32Information kind of flows. You can kind of do anything on a screen. So, yeah, we haven't talked about doing anything in hardware yet. One kind of crazy idea I have is because a lot of people do homeschooling now. A lot of – I've become close with some people who are fairly prominent who do homeschooling. And I like the idea for my kids as well, having like a booth with like a screen and speakers and just something to like isolate. the outside world where you've got the computer in it and you're going to go in there, you're going to go in this booth, which seems kind of dystopian, but it's going to be for like an hour and a half a day, right?

1:38:09Like lock the door and everything else. Yeah. Yeah. Yeah. It should have like a time lock on it. Of course. Um, yeah. You have to complete the lesson to get out and get out. Well, last, last question for me, let me flip that around. Um, I, I know a lot of parents are obviously, you know, they want their kids to be accelerated in, in STEM and math, But there is the other side of like socialization. And there's a big question like, you know, Tyler Cowen's written about this, how maybe in the future intelligence is too cheap to meter. The real value is in connections being we like to joke that we're we're we're trying to be golden retrievers, be very friendly, attractive and dumb because intelligence is going to be too cheap to meter.

1:38:49The I can do the rocket science for me. But, you know, if I'm a friend that you want to hang out with and you want to chop it up with, we're going to have a great time. so i mean but i mean seriously as a parent like i think a lot of parents do even worry even more about their kids like like hey it's okay if you're falling behind in math just a little bit as long as you're getting socialized and and becoming like an upstanding member of society and so do you see ai tutors or ai calibration being able to communicate with a child and understand hey they're being a little anti-social or something like that in a way that a teacher could or maybe just an augmented or an additional layer there to to see hey this this kid is you know actually engaging at a very you know mature level which is great these are good signs we want to continue this pattern of behavior yeah i mean that's a great question i think parents are correct to uh worry more about social skills especially from a young age how old are you guys kids are they they're like 24 and then i have twin boys who are six months yeah oh okay three and eight months yep okay cool so yeah you're in that age now where like the social skills matter i think up to like age seven yeah it's like close relationships with the the family and just try to spend as much time with them as you can makes sense and be around and like reading faces i actually think it's a mistake we don't like actively recruit customers below age seven uh Because if you think about how much processing it takes to learn how to operate in the social world and read faces, I think you just want to leave kids' brains open to basically spending all their resources doing that.

1:40:28Because if you get it, it's like speaking a language. You get that by like age four to seven, then in some ways you're set for life because you're going to be able to fit in with groups. And I think that's extraordinarily important. And we kind of – when it comes to education, I think it's – I don't see that the AIs are going to be able to do our thinking for us. I mean that's like a totally different world. It doesn't look to me like we're on the path to getting that. I think LMs are really cool. I think you're going to want your kids to be smart and knowledgeable and able to think as an individual and also have those social skills to work with other people and solve problems together, which is humanity's way of superintelligence, right?

1:41:06It's like being able to work together in groups. So this is actually mirrors the structure of the company. Now the AI tutor is like the leading edge of the product. But then we have synthesis teams where you put kids in teams, small groups to work together in solving problems. They're like video games, but they're not shooters or race games. They're like complex problems where you have to argue and decide what action you want to take under conditions of uncertainty, figure out what you got wrong and make the course corrections. And it's like meta problem solving skills. So I think if you want these outgoing, sociable engineers, people who can do both sides of their brain, I think we can do that.

1:41:43I think, of course, people lean one way or the other, but I think we can get people up to a really good standard on both of those. And then that's just going to make us able to solve more problems and advance the civilization. So that's how I'd look at it if I was a parent anyway. Work on the social skills first. That's a fantastic vision for the future. I'm very optimistic. I have one last, last question. uh miss rachel on youtube very popular little controversial uh do you have any under the radar creators on youtube that just make uh i my wife is very good about having like extremely limited just like tv screen time we don't do ipads in public or at home uh planes are maybe the one condition so if i'm taking uh my kids on a plane is there is there a youtube creator that you recommend or you just like now put them on put them on uh give them their ai tutor and uh that's that no i mean at your kid's age i think uh the daniel the tiger like pbs series is is really good if you guys know that one um alpha i don't know this is alpha yeah this is the real that one's great that it like teaches them little it's like i think it's like the uh successor to mr rogers thing he's like made maybe like the same people so they've got like little lessons and it's animated it's okay for them to watch your kids watch bluey oh yeah you ever seen bluey bluey's great so that's what we would do when they were on planes and little kids like that i would i haven't seen i've got four of my own and just having seen the um i think youtube youtube is quite bad and it seems to push them into the youtube shorts which are just terrible and even my like five-year-old recognizes like this is bad i shouldn't be watching this what's up yeah We were just agreeing the short form is like slop and you know, you should avoid it at all costs, no matter what age you are, basically.

1:43:30Except ours. Except ours. You should definitely watch clips of this because we will be clipping this interview and posting it out. And you should definitely watch these shorts because they're educational. But clips on X are great. It's different. Yeah. But I'm sure if you swipe up on this on X, you're going to get some really tiny stuff. Anyway, this was an awesome interview. Thank you so much. We'll have to have you back soon. Thank you for joining. This is fantastic. Very helpful. Thanks for having me. Appreciate it. Have a great rest of your day. We'll talk to you soon. Talk soon. All right.

1:43:57Cheers, guys. That's hilarious. The how much screen time thing is a great question. I don't know if you saw Peter Thiel got asked this at Sun Valley. Really? Yeah. Because they would say, oh, you're the board member of Facebook. How much Facebook do you think kids should use? It was basically screen time. And he was like 90 minutes a week. And so I was just like, yeah, that seems like a good number to benchmark against. But then I was trying to think, how can I make this? got to get your 90 son yeah no no here's the ipad get your 90 in no no mr mr teal yeah yeah you gotta get those numbers up uh but no but then i wanted to make it like you know can i can i make it even easier to keep that number lower because you want to basically keep the number as low as possible uh and i realized you just have to create a really brutal economy in your house so we have a whole economy going now where you get stars for brushing your teeth doing all these different things oh yeah and all of a sudden it turns sticker economy the sticker economy is big and so all of a sudden it turned from like oh yeah like it's a friday i can watch this too like i am grinding for like weeks for like a movie night which was like it was just free before but he doesn't mind it that all of a sudden i've just created this you know kafka-esque economy around it that he has to work like weeks to get like a single episode a single like eight eight minute episode of blue, but, uh, but it's worked fantastically.

1:45:18The new economy feels the reward. It's fantastic. I highly recommend it. Create a really, a really arcane economy in your household, uh, for whatever your kids want to do. It's great. Anyway, uh, speaking of arcane Kafka esque economies, let's move over to venture capital. Uh, Wilmanitis posts, Paul Ferry, founder of matrix partners. There's a little interview in this book, a question. Do we have 20 minutes? What do we have? And he says, no, I'm done. I have to quit. But again, Ben, if you want to call me next week or continue on, we can do it by phone. Let me just finish the point. So why is this the best business?

1:45:52One, you can make a lot of money if you're in it for a long time. It's not a business that you can get rich next year or the following year or five years. It's changed a little bit with some of these mangoes, solo GP funds. It may be 10 years, it may be 15 years, but if you continue to be successful at it, it's amazingly rewarding. But more importantly, you're dealing with interesting people all the time. They're innovators that are people that are changing lifestyles in the world. You're dealing for the most part with people who have no net worth and you're helpful to them in building net worth for themselves and net worth for their employees.

1:46:23And you can be in the venture business and be relevant for a very long period of time if you're good at it, more so than if you start a tech company. The people who started Stratasup Computer or Apollo Computer were relevant and important people in the 80s, but nobody knows who they are today. whereas people that were in the venture business to be relevant for 40 30 35 years later you're at the leading edge of product development or technology or capability there's no other business like that you're not collecting the receivables for the hundredth time you're not laying off employees you're dealing with interesting personalities so it's the best business sorry we had to cut it short but something came up and i have to attend this great uh fantastic quote the only the only the only pushback here that some gps would give you is the uh downside of having you know uh 20 to 100 lps who are your customers in many ways and can call you at any hour of the day 365 days a year uh to uh you know well that's the most interesting thing is that like there's this bifurcation right now where a lot of funds are trying to do less LPs, higher GP commits.

1:47:32And then simultaneously there's the opposite, which is like, let's go public. Let's have any retailer, retail investor be able to yell at us when the stock goes down because we had a miss. Yeah. But you know. Yeah, I've got a buddy who raises first fund. It's$20 million fund. 100K is like the average check size. So that means there's people that are way less than that. People that are way more than that. But you do the math. It's a lot of people. I wonder how, I mean, if General Catalyst and Andreessen Horowitz get out in the public markets, I wonder what the smallest fund to go public would be in like five years.

1:48:06You think someone would take like a$100 million fund public? Are there any? Just raise a fund, just SPAC it, sell your entire GP stake, deploy it all. Yeah. I mean, I don't know. Stranger things have happened. Who knows? Silly. Anyway. There's not. Let's move on to Nir Sian, big friend of the show. They're hiring for a social media influencer marketing lead. This seems like a dream job. Seems really fun. We released V1 of RN last week, and the response has been amazing. If you'd like to lead our marketing team for an app that has already been redefining the relationship between humanity and AI, please apply slash DM.

1:48:45Nir is super smart. I got early access to the app. I've used it, and it's very cool. It's built on Claude, but Nier is super opinionated. And a little lore here, we talked about this before, but for anybody that doesn't know, Nier developed some notoriety for creating an NVIDIA-only fund. That's right. I think two years ago at this point, it turned out. You just can't sell it. Yeah, for 10 years. Yeah, 10 years. So the whole point is that it's a 10-year lockup. That's really fun. I think that's a cool thing. so far so far so good and uh yeah i mean we've featured new year's posts many times a lot of bangers yeah and this is just an underrated role in tech because there's the historical social media manager role yep that was like you have your little sass tools and you know your scheduling posts out weeks in advance and that's just not the way that social meeting we talked about the pmfra die guys yeah it's it's like it's like can you make a crazy vibe reel can you post a bang or can you be truly in the conversation get a bunch of fans be doing frontline customer support almost getting you know uh executive communication from the founders get the founders posting more yeah you know it's just it's just 360 now anyway i wanted to move on to a a little historical size gong, because I wanna have Connor Zwick on the show from Speak.

1:50:16Do we have our guest in here? Okay, we'll do this one after. Let's bring in Michael, he's here. I got so excited with the size gong, I was gonna hit it, but I can't do it right now. We can hit the size gong for Michael. Welcome to the show. Welcome, Michael. We don't have you up on our show. We hit it a little harder. Hit the gong a little harder. all right there we go that works can you guys hear me right every time oh we broke it that was that's what i was going for i was hoping we would break it welcome to the show uh what's going on uh you made it to boston he uh michael messaged me like maybe two hours ago and says i might uh be in the air but you made it and you're at uh where are you right now so this is the suno studio oh cool very cool this is where i guess they have like artists roll through and stuff when they're in town nice yeah so is boston a major is boston a major music market or is it more so they're bringing in musicians that are helping improve the models that they're making and the app in general i think it is a market right it is a it is a major market but no it's not like in la or in new york but this is where suno was founded right uh the founders came out out of MIT, Harvard.

1:51:35Obviously, as you guys know, there's a lot of machine learning research going on in Boston and Cambridge. So that's where the company got started. But I think they had a really smart idea, which was when our artists are going through Boston, which most major artists do, they can use the studio. It's a place to do some stuff. That's cool. Okay, that makes sense. Really quick, can you introduce yourself to the studio? Yeah, yeah, yeah. And give yourself a back to around. The man who needs no introduction, but you may as well do it. but you're not at that level yet of course of course no i mean i i appreciate you guys bringing me on sorry am i introducing myself yes yes yes yeah introduce yourself tell us what you do now and then i i have a bunch of questions about your career we'll dive in all right let's do it uh what's up everyone uh my name is michael mignano i'm a partner at lightspeed uh i was the co-founder of anchor podcasting platform which is now owned by spotify i also recently co-founded a company called oboe which is a an ai education platform awesome yeah big big fan of the pod happy to be uh one of the early guests thanks i'm a huge fan of anchor i we i used it for some podcast test i did like must have been right when it came out and i just remember thinking like man this is this takes so much of the headache out of podcasting exactly just you could upload it on your phone i i don't think what was the original vision uh you wanted people to be producing and and producing podcasts on their phone and uploading because that was a button you could just kind of hit record and then boom it goes out to the rss feed but it seemed like it almost became like a prosumer tool pretty quickly because the podcasting market it's pretty bifurcated between like people start taking it seriously once they get any sort of traction right yeah no the the original vision for anchor actually was not to be a podcast platform it was it was very very idealistic we wanted to be a social media platform like audio social media Yep.

1:53:22Like think clubhouse, but a couple of years earlier. Sure. And what we, what we learned is that social audio is really, really frigging on. Yep. Um, you know, we, we, we took a crack at a certain format, uh, take on it that we had, which did like fairly well. I mean, there was like, you know, there were spikes of growth here and there, but overall wasn't working after a year, we like completely pivoted to another iteration of social audio gave that a year didn't work. And then what we were hearing from all of our users is, Hey, we just want to use these tools to publish podcasts to Apple and Spotify.

1:53:55And when we did that, it was just like instant PMF from that moment. So yeah, take us through the story of the company. How big did you get? You raised money, I'm sure, eventually exit. I want to hear that. Yeah, and for a little bit of lore, when I was, this was 2018, I had just, maybe I was still in college. I hit up Michael and he did a call with me. Didn't need to, had no real, I mean, it was much more beneficial for me. I was doing, I was working in, you know, doing a bunch of podcast advertising stuff at the time, but, uh, thank you. Thank you to Michael. You always remember the people that like give you, you know, 30 minutes of their day, uh, however long it takes, but, uh, but yeah, I would love to hear the, the, the story again.

1:54:38Yeah. So, so, so my co-founder and I, uh, near Zickerman, we, we built product at this company called aviary. And this was around the time that um like instagram was taking off and people were realizing that you could take and edit photos on your phone and it could actually look good obviously you know now that's that's just a given like the camera is the phone and you know we sold that that business to adobe and while we were there we got really into podcasts yeah and we were sort of like sitting around asking ourselves like how come nobody has done for photos uh how come nobody's done for podcasts what has just been done for photos and so that was like the original idea like and of course at this time it was like 2016 everything was a social network back then like snap was exploding and we're like oh of course this should be a social network right we should have a feed we should have a button right at the bottom of the app in the middle and and so that was the original vision we raised a couple million bucks from folks like uh beta works and sv angel and eniac and all these all these guys and um and yeah like i said we you know we we had to go through a couple of different pivots we raised i think to answer your question john we ended up raising just under 15 million total sure uh we were about 25 people when we exited we sold to spotify in 2019 did you actually announce two acquisitions on the same day anchor and gimlet i remember that i remember that which is like the cardinal sin of of launches is like if you have two both very interesting launches you should just do them like space them out and like you know get the full benefit of each but uh i think i i mean you could probably speak to it more than i can but it It seemed like Spotify really wanted to plant the flag and be like, we are in podcasting now.

1:56:14So not just one acquisition. We're taking this seriously. Wait, quick question. Did you ever run into Archie Archibong at Aviary? Yeah, of course. I went to high school with him. I hope he's listening. Yeah. Yeah. I'll have to send him this clip. That's awesome. Yeah. Yeah. He was out in Japan a bunch. Yeah. That's right. Good guy. Big in Japan. Huge in Japan, honestly. I wanted to ask you about where, you know, as somebody who sold your company to Spotify, worked there for a while, and then now you have a much more sort of now you're a venture capitalist. But still, you know, I'm sure very opinionated on the Spotify product.

1:56:50How do you, you know, where do you think Spotify is going? you know we had talked about this a little bit offline i'd said uh and i'd even posted about this of spotify and youtube have sort of always been on a collision course long ultra long form became very important to youtube and then they became the biggest podcast platform uh and in many ways like podcasts aren't just replacing radio they're replacing tv yeah right which is so it's super important to youtube uh and it it feels like a sort of critical battleground for Spotify, but I'd be curious to get kind of your point of view on the, on the overall, uh, battle between these, you know, tech, tech giants, right.

1:57:29Spotify feels like a small company, but it's$140 billion market cap. It's a big business probably would be well beyond that if Apple music, uh, wasn't, you know, rammed down everybody's throat, but, uh, but yeah, I'd love, would love to get like a kind of general market perspective on that. Yeah. So taking a step back and I should caveat all this by saying that I haven't been at the company in like three years. So this is, this is a pure outsider perspective. But you know, I think the big thing that Spotify has always done well, and they've always believed in is this notion of bundling, right?

1:58:02Like taking, taking these products and these business lines that they have strengths in, and then bundling them with other new, new products on product lines and product and business lines. And that's honestly why podcasts were so successful for Spotify. You know, if you think back, back in the day, when it was like Spotify head to head with Apple. Apple had two separate apps for these things, right? They had music and they had podcasts, two separate apps. And that was a, that was a total gift to Spotify because Spotify could take the podcasts and put them right next to the music. So you never had to leave the experience.

1:58:34And that's really what kickstarted the whole thing. It's like they had a built-in audience of hundreds of millions of people that were one tap away from podcasts. And I think, you know, maybe to start getting to the question you're asking, I think that's how they've probably thought about video as well. It's like, hey, we have people listening to music. Now we have them listening to podcasts. What if we bundle in video now? And that opens up a whole new market for us. So the obvious place for them to start was with podcasts, right? They have every podcast in the world already. Now let's get these people to add videos to these podcasts.

1:59:06But again, as an outsider, you have to imagine the next step is you start to see other types of video content on the platform. And even if they can start chipping away a few market share percentage points here and there of YouTube's catalog, that's a big deal for Spotify. So I think it's a pretty smart move. How do you think about the relentless march of the algorithmically curated feeds in the podcasting world? I think a lot of podcasters are super, super happy that they're in the RSS feeds. and they feel like it's almost as strong as having someone's email address. There's a very high open rate.

1:59:42If you have that RSS feed, your weekly show, you're dropping a weekly thing right at the top of their Apple Podcasts app. And Spotify has a similar feel right now, but you could imagine them going to something that's more algorithmically generated, more variance in the total views. You see this on YouTube where Mr. Beast can be reliable, but for most other creators, it's like a banger and then a flop and then a banger and then a flop. And we all feel this on X when we post, you know, it's very high variance, but you can go really, really big because it's an algorithmic feed. You know, your podcaster who's built on RSS, pretty hard to all of a sudden have one episode go 10X bigger, but the downside is very protected.

2:00:23Do you think, my question is basically like, if I'm an RSS podcaster and I'm thinking, hey, I want to go to Spotify, this is a little dangerous because I could see them going more algo feed in the future. And then that introduces more volatility to my business. Maybe that's good. Maybe that's bad. What's your read on that? Yeah. I mean, I think the RSS feed is a very, very controversial thing in podcast land. You have the podcast purists that will live and die by the RSS feed. I mean, they will fight you to the death if you tell them that RSS is going to go away. But on the flip side, it has lots of limitations, the RSS feed.

2:00:57It's not like a two-way channel, right? It's very limited in terms of the functionality it can ultimately provide. And, you know, I think there's probably no coincidence two biggest platforms now for podcasts, Spotify and YouTube, are not really RSS-based anymore, right? They're all doing things that layer on top of the format that have nothing to do with RSS. And so, again, I know like the RSS purists are, you know, probably want to murder me right now, but I just don't, I don't know if the format is viable long-term as a solution, I think. Because like you said, you can get massive, massive distribution on youtube that you can't get through just like a plain old rss feed totally yeah the the two things as a creator now uh the analytics on the rss feed are just obviously a joke you basically get no analytics and then with spotify is a lot better but then the the distribution which we're already seeing this with spotify um you know we're we're growing our audience just by nature of being on spotify versus like that's not really happening on apple it's sort of us driving uh other sort of top of funnel um growth um but anyways it's the classic it's the classic centralization versus decentralization argument right like yeah and in most cases i know people don't want to hear this but centralization often wins yeah yeah uh what's your take on the the pivot to video for most podcasters we saw a big one today invest like the best now has video I started on video with YouTube basically.

2:02:27I never really had a pure audio product. I think the first episode we did was video. We very much enjoy video. But is there any hope for a creator that just wants to stay audio only for the future? I don't think so because, again, we're talking about Spotify and YouTube being the predominant platforms right now. And we know that those algos, they need the video. They crave the video. I think users got wise to this. Actually, it was during COVID. People don't realize it was during COVID when before COVID, people were recording podcasts in studios, in boots, similar to how you guys are now. But they weren't video.

2:03:06It was just like a microphone on a table. And then COVID, everyone went home. And the way that these shows kept going was through Zoom in Riverside. so you get video so all these podcasters got video for free and they were like oh shit if i upload this video to youtube i get all this distribution yeah and now you can't go back the the algo craves craves the video craves the video that makes sense the ai guys um talk to us about uh i'm gonna butcher the name oboe i've only read oboe oboe uh so this is a company you basically incubated you're a co-founder but obviously you're you're still a full-time investor maybe talk about that dynamic and then what you guys are working on yeah recently co-founded this new company with my former anchor co-founder near stickerman he's the ceo he's you know he's running it full-time uh i am not full-time on it as you mentioned i'm a full-time partner at lightspeed um basically the the premise behind obo is very very simple um We, the humans, you guys, me, everyone, we have invested many, many billions of dollars over the past couple of years in making machines very smart, right through AI.

2:04:10and we believe with Oboe that it's time for the machines to make humans smarter and so this is a company the premise of AI making humans smarter you guys have all heard a lot of the talk about you know a hyped up use case of chat gpt has been oh it's going to be a personalized tutor it's going to help people learn chat gpt is not really built for that yes yes it's helpful for like one off asks hey tell me about this thing tell me about this thing but john it doesn't know everything you've ever learned and it doesn't know what your interests are and it doesn't know what your goals are and you know maybe learning a new language or learning about i don't know some theory around finance or something and so that's the basic premise of what what oboe is solving um we have a beta coming very soon if people want to be the first to check it out just go to our i guess our x oboe labs at oboe labs um i'm very very excited for it and uh yeah i think i think people are going to really like this product.

2:05:05Awesome. Yeah. And you, uh, you dropped by the PMF for die cage to support the players recently, and they're working on a problem that's, that's sort of adjacent. Um, uh, but, but yeah, maybe, you know, and, and funny enough, we, we just before this, we had the founder of synthesis, which is an AI tutor. And so it feels like it feels like we're maybe, uh, I'm sure maybe people have already done it, but sort of a broader market map around, you know, AI and learning. Maybe they exist. It's kind of like we're in the app store moment where there's a bunch of, we need to build products around this stuff.

2:05:37We have the new technology, but you know, what is the dominant product factor, product form factor for each of these use cases. And so it's a knockout drag out fight. Good luck out there. Yeah. I mean, that's, it's usually a good sign, right? Yeah, totally. And consumers benefit. I mean, everyone benefits. Like, you know, you, you, you, the pace of iterations very fast. You get to test a bunch of things. You get to try new stuff all the time. Everyone. And then, you know, at the end, a bunch of people make money, which is great. Exactly. How do you think about the pressure? So you're sitting on both sides of the table, right?

2:06:08You're an investor at Lightspeed, getting an opportunity to look at and invest in some of the fastest growing, most exciting companies in the world. You're on the founder side now. meanwhile the average founder is being inundated with content around companies going from zero to 10 or zero to 100 million dollars in this super short period of time meanwhile you at anchor you know pivoted multiple times and iterated towards this idea and eventually had a fantastic outcome but it wasn't this sort of straight shot linear as a founder now and from the founders that you talked to is there just sort of this extreme pressure around i need to deliver faster results than ever?

2:06:46And do you think that could have a negative impact on outcomes? Because when I think of Oboe, I think, okay, massive TAM, massive opportunity. This can be a$10 billion plus company if you look at companies like Duolingo and things like that in the public markets. But I could imagine that you're going to have to sort of iterate in the same way. So what does success look like for you? And what advice do you give founders that are kind of facing that pressure to put up ridiculous numbers in a really short period of time or be relegated to the sort of not top tier company. Yeah, we actually talked about this in the PM Epidio cage.

2:07:24In the cage. As one does. There are a lot of startups right now that are experiencing explosive revenue growth, right? It seems like every week that chart has a new line on it. You know the chart I'm talking about. 100 million ARR. Six months, two months, one day, zero days. Uh, something we talk a lot about at light speed is, is like high calorie, uh, ARR and low calorie error, right? There's a lot of like cheap ARR growth out there. And I think a lot of it has to do with the fact that AI is very magical. People see these products. They're kind of like blown away by them. And they're like, Oh, here, take my credit card.

2:08:01Like I'm happy to pay. Um, but that doesn't necessarily say something about how sticky these products are or how good they are or whether or not these users will actually retain. And so, you know, with a lot of these explosive high ARR companies that we've seen over the past couple of years with AI, it's not really a secret. You guys have probably heard of this as well. Many of them are very, very churning, right? They churn very quickly. A lot of trialing, a lot of like, ooh, I want to experience this magic moment, take my credit card, but then I'm never coming back. And so, you know, the advice I gave to the, um, the guys at the page was, I think we got to remember to continue to pay attention to like the metrics that have always mattered.

2:08:42Right. Things like consistent user growth and retention and making sure like the retention cohorts flatten out. They don't just like drop to zero. Cause I think people are getting like very, very hung up on this ARR metric, which is great. I mean, it's a business that can go from zero to a hundred in six months. Phenomenal. but you can't ignore the traditional metrics that tell you whether or not a product is good and i think i think that's going to be really yeah so on your side are you are you ready to uh you obviously started this with your former co-founder are you guys ready for uh you know i think you have like good instincts here but you you must be sort of ready to you know do as many uh hopefully it's a one shot you just nail it out the gates but it sounds like you guys are ready to uh pivot as many times or sort of adjust the strategy as many times as necessary because it is such a big problem space.

2:09:32There has to be a, there's definitely a billion dollar business in here somewhere, but you know, it still takes work to, um, find that spot. Absolutely. I think, I think you gotta be willing to pivot. And by the way, that's what we see, like, you know, in places like YC, these companies pivot sometimes like five times over the course of two weeks, the pivot is so important and um you know the other thing i would say is uh not only do you have to pivot but you have to move faster than ever i mean the thing that i felt when i went in the cage with the guys was i've never seen people move this fast these guys have been in there two weeks they showed me what they're working on and i'm not going to reveal it they told me not to reveal it but the the amount of progress they've made in two weeks i've never seen anything like it yeah like they literally went from not having a line of code to having a very fully featured app by os app they're about to ship to the app store yeah there's just never been competition like this yeah yeah it's insane uh i interviewed this uh this guy josh moore on my podcast he started this app um called wave you guys seen this app wave i haven't it's kind of like kind of like ranola it's like a note-taking thing with it sure got it cool it's doing like five million arr he built it by himself just like he had never coded before in his life that's amazing and he uses ai to not only teach him how to code but to write the code and to generate marketing and it's just the level of intensity and competition right now is unlike anything we've ever seen that's fantastic uh switching over to uh putting on your your investor hat uh wanted to give you an opportunity you know lightspeed's big investor in xai um you know, and has been just one of the most active investors across the foundation model landscape.

2:11:16I'd love to, you know, besides the obvious, you know, you just sort of invest in Elon companies and, you know, you tend to do well. What was like sort of more of, you know, without going into, you know, go into however much detail you want, but like break down kind of the memo on the XAI thesis. Yeah. I mean, a lot of what has been reported publicly you know aligns with with our our thinking and our thesis uh thesis and that yes betting on elon is a pretty smart thing but but more than that it's it's the level of intensity i mean to again bring it back to the speed and intensity that that he and the people that he hires uh brings to the team and so you know the first time we talked for that team and they were telling us about the data center that they were going to build and again it's been very publicized at this point yeah um we were like wow like if you could actually do this you would you would go from basically the starting gun to you know being at the same level or possibly exceeding open ai in in a matter of months in terms of model performance and and then they went and did it like they literally did it in like three or four months um and i think that type of intensity and speed and scale that that that you know only elon and elon elon like companies can actually do combined with the fact that they've got obviously this incredible distribution channel right out of the gate through x and not just a distribution channel but a really unique content set to feed off of the model right this model unlike most other models it has real-time information that they don't really have and and that real-time information also serves as a surface to trigger you know usage of the product analyze this post tell me more about this um so i think those are some of the factors that uh that got us excited and the team has as far beyond delivered uh on what they said they would so it's been really exciting that's good yeah what um uh you know obviously you can't share any details here but uh should that should the broader market expect more foundation models or is it kind of getting to the point you remember in crypto it was like okay we don't need another like foundation level we don't need another l1 like like and then you'd see one and you'd be like really you know like but this one this one built different um or or or do you think that uh you know the five or six major players thinking machines xai open ai ssi are those like the labs that you know you know we're sort of betting on uh or do you think there's room for for more teams there the way we were framing this was like if it is commoditizing well commodities are valuable oil is a commodity and everyone wants to drill for a well yeah it's very capital wells you have the better get a bunch of wells yeah it's capital intensive but if you put together a really great team you can just start a new oil company and it's being worth something you know but yeah what are you thinking about it yeah i mean i think you know i think a few weeks ago a lot of people wanted to have the debate about whether or not you know deep seek meant that models were commodities and nobody should ever train foundation models again i actually feel like that was the wrong conversation to be having, you know, the way we think about it at Lightspeed is these companies are not just models.

2:14:27They are companies. They have distribution, they have customers, they have data, right? They have security, safety, like things that enterprises actually care about. And so, you know, I think should there be more models trained? Maybe, but I don't think a model by itself is necessarily interesting. I think there needs to be a product and a team behind it. And so I think if you were starting a model, you know, if you're starting a company today that was training a foundation model i think you need to either bring something very very unique to the table in terms of what that model can do or you better have some other advantage in terms of distribution or uh or some sort of data that other players don't have access to uh that lets you jump up ahead and and i think like that's an example of something elon and the xai team were able to do they were able to build this data center in a way that no no one else was willing to do to jump ahead, right?

2:15:18Yeah. So yeah, that's a little bit of the way that we think about it and talk about it. Yeah, that's fantastic. You have any other questions? I think we covered everything. It's been great having you. We'd love to have you on. When you have news with Oboe, new investments, things like that, come on. We're all about conflict, right? So we want people coming on that have positions in the companies discussed on this show. Highly conflicted. yeah so it's uh no conflict no interest right exactly yeah that's uh that's our motto you come on pump your bags then we'll have your direct competitor come on pump their bags yeah yeah why not why not have you both on the guys in the cage by the way yeah yeah yeah yeah um thank you for uh thank you for coming on thank you for supporting the players and uh we'll have you back on here soon have fun uh are you gonna go play some music right now i don't know maybe why generate some music around with that that gibson in the background yeah generate some music honestly skip the skip the gibson wait uh you're in boston are you staying throughst patty's day no unfortunately not you gotta go to south you get get hammered on guinnesses and throw up in the street like you're just boston and just college to yell about your stripe secondary yeah yeah yeah exactly yeah be fun and in in in another uh another timeline maybe In another life, yeah.

2:16:38Yeah, I don't know if my wife, hey, I decided to stay five more days to get totally annihilated. There's going to be green beer. There's going to be green beer. I have to drink it. I have to do a keg stand in South East. I'm sorry. Exactly. Anyway. She'll understand. She'll understand. Great hanging out with you. Have a great rest of your day. Great to see you, Michael. We'll talk to you soon. Later, guys. Talk soon. Cool. Michael's a man. we're we're like informally doing a full like deep dive on ai education today yeah we got that now i want to go to connor zwick over at speak this is for language learning wait you know we already did a size gong whole segment on this by the way we did so i think we should skip this okay yeah let's skip it but we do but i do want to have i do want to have them on at some point um but yeah little little historical size gong you know yeah you gotta do it you gotta do it Any excuse to hit the gong.

2:17:31Yeah, we'll take it. Well, let's go over to Sagar and Jetty, a good friend of the show. He's reporting, he's getting a little political, but it's fashion-based politics, and so we'll cover it here on the show. Denied entrance to the Senate chamber for Senator Jim Banks for wearing Cloud Runner running shoes with a full-suited tie. He wasn't wearing proper footwear, and Sagar says, the way I feel reading this must be, what it's like to get high on heroin because soccer has been beating the drum on we need our politicians to be well dressed they need to be wearing suits no more sweatpants no more hey dresses at least as nice as we do this show yes which john sometimes gets upset yes because i'm not wearing a jacket yeah but i just like to wear a college shirt sometime and do a little business casual it's uh it's too casual for casual unless it's casual friday in which case we should be and Jeff Lewis tank tops.

2:18:31Anyway, love Sager highlighting that. Speaking of Jeff Lewis, he's the next post in here. There we go. He says, Jeff Lewis over at Bedrock says, things that go up only over 10-year time horizons, select individual companies led by transcendent entrepreneurs, private and public, tasteful, ultra luxury real estate. I like where he's going with this. Land in select locations, select cryptocurrencies, currencies select precious metals and select artwork he says that is all i love it ominous great post yeah so if you're in the mag 7 yep rotate to select precious metals well if your mag 7 company isn't led by a transcendent entrepreneur yeah because if you are led by a transcendent entrepreneur it doesn't matter if you're public or private you can still go up over a 10 year time horizon, but otherwise get out and get into some ultra luxury real estate, some cryptocurrencies, some precious metals and some artwork.

2:19:30I do it. I think we're, we're getting up to speed with the ultra luxury real estate. We're getting up to speed with the crypto and the precious metals. Uh, I think we're behind on the artwork. So we should have them on to talk about that. Where's, where's the bull market. There's always a bull market somewhere. What art's great because you can find an artist that you like buy up all of their available, you know, works and then just start, uh, you know, putting them up in auction, buying them yourself, you know, sort of market chandelier bidding. Yeah. Are you familiar with chandelier bidding? Uh, it's a phrase for when you are essentially bidding on your own.

2:20:07Yeah. Just to like kind of raise the reserve on a, on a piece of, uh, on something that you're, you're auctioning off. And of course, if you win your own, win your own auction, then you have to, uh then you have to pay the fee but the fee for the risk of pumping up the price you know demand i think that's just called market manipulation chandelier bidding i just looked it up oh yeah what is that where the auctioneer auction house pretends to see a non-existent to see a bid from a non-existent part of the room so you go oh okay and and we're going up so it's the auction house trying to pop their bags yeah i got it it's not you you're talking about is even more real where you know i i know people that let's say you own 30 pieces of artist work and one of their pieces that's comparable to yours goes up for auction if it doesn't sell well then your entire collection sure sure so you might as well just buy you might as well just buy it mark yeah mark it up smart mark it up vcs do this yeah they're like they're like all of the all of the foundation model companies are worth so much because every time one comes to market it's worth billions and so you know the the first one i invested in certainly has to be worth a trillion yeah who knows uh anyway uh speaking of a company that sorely needs to acquire one of these foundation model companies transcendental uh apple uh plans one of the biggest software overhauls in its history for ios 19 ipad io ipad os 19 and mac os 16 if you love the photos app you're gonna love this looking to revamp its operating systems for a new generation of users and raj vir says i don't trust 2025 apple to pull this off they might just incinerate the greatest business ever created uh and chris horn says yeah i'm taking under on this i don't know i don't know if they can incinerate the greatest business ever created but uh they definitely need to try something new they definitely need to get some fresh blood in there take some they could really make the software much worse and it would still take a lot to actually compete with them on the hardware people don't like green bubbles and yeah the hardware is hard to make it's a very reliable product it connects to the wireless network reliably people forget that like you know a lot of the beauty of the apple ecosystem is just yeah like it finds the 5g tower or the lte tower or it doesn't drop phone calls that often like that those are considered table stakes but they could go away if you get lost in something else.

2:22:30Anyway, Jared Rossner says, huge opportunities for AI startups that no one is talking about. AI native brokers. When broker transactions can be fully automated, those markets evolve. So for context, Jared. Oh, hey, really quickly, we got Dalian on the show. Oh, here he goes. Hey, how you doing, Dalian? What up, Pam? Congratulations on launch day. Thank you. Thank you. Thank you. What's new with you? How did you enjoy the weekend? uh you know um tahoe terrible place to ski great place to hang out with friends always you know sort of happy to uh you know sort of be there and uh yeah god bless you know sort of coogan's wife for being willing to carry two big coogan's that ever for once upon a time really hard to want to do that myself well i mean she got she got a relaxing weekend it was good uh it was all worth it it was all like you have twins twins if you have twins twin boys give me a third son yeah i'll take you to tahoe i actually didn't get to ski with you delian are you good can you do backflips in 360s or um you know i think i was the best skier on the trip but um you know i'm not quite at the level of uh doing backflips but i do have many friends from high school because i went to high school in utah that are very backflip capable um including my little brother pavel's uh co-founder jeff morelle um she's a sort of ceo out of new york not skiing very much but a very cool skier So where are you on the, where are you on the skiing risk curve?

2:23:51Uh, do you ever scare yourself skiing? John and I were talking yesterday. If you're getting to the point where you're genuinely scaring yourself consistently, it was probably too far, but at the same time skiing, I was telling a story in December, I was in the Alps and having the best run of the trip, you know, got distracted for a second and fell like 200 feet, got a yard sale, did a yard sale, then fell like another 200 feet. But you know, that, that happened once on the trip. that's maybe the most that I'm comfortable with. Where are you on the risk curve? You know, I think I'm very bad at the risk curve and I should be better at that given that I have a wife and, you know, sort of child.

2:24:28But weirdly somehow in skiing is not the place where it shows up. Like I've had probably more near death incidents in like the first quarter of this year than like, you know, the prior decade basically combined. And so it's made me think a lot about maybe I need to adjust my risk curve. But somehow in skiing, I've just skied for so long that I know the downside of like, I did all the crazy shoots and cliffs and all that stuff when I was younger. So I don't feel the need to quite go that crazy. But then yet again, earlier this year, I found myself in this place where I was just like, I kept powder hunting.

2:24:56Where was I? Oh, yeah, in Deer Valley. And I just kept going slightly more off-piece and slightly more off-piece and slightly more off-piece until at some point I found myself going a little too fast off a cliff that I didn't know was there. I managed to catch myself. But unfortunately, halfway down the cliff where I no longer had an option of climbing up. I just had like the rocks below me, but not enough speed to clear them. And so I was like, well, there is only one way out of this. It doesn't involve like, you know, waiting an hour for ski patrol to like, you know, come and grab me. And it's like, it's time to go rock skiing.

2:25:28Launched myself, skied across the rocks a little bit, went off. And I was like, I think I'm done for the day. So, you know, I've gotten better by risk curve, but, um, yeah I purposely only grabbed a super thin racing carving skis I'm not even tempted to go off piste the only thing that these things are capable of is carving are you are you having those near-death experiences as a pilot you fly small planes the pilots I know will tell me these stories where I'm that are just like the most harrowing stories about a single landing on just like what was supposed to be a casual trip and they're like yeah it was raining and we lost connection with the tower and it was like completely pitch black and there was no lights on the runway so we had to land and the plane was like going backwards there was so much wind and I'm like how does your wife let you do that uh where are you having near-death experiences other than skiing um you know uh every uh motorized vehicle that I find myself behind you know whether it's in the air or not I I somehow have found myself in a bad situation over the past quarter so I'm so deep in the doghouse that I'm putting myself through a remedial program of, you know, I'm very good at the technical nature of the operation of the vehicle, but it's the higher level risk calculus of what situations I put myself into that is very poor.

2:26:46So my remedial program is I went back to all my flight trainers, and I went and found the oldest one. Because as they like to say, there are bold pilots and there are old pilots, but there are not bold and old pilots. There you go. I think it's important for me to become an old pilot rather than a bold one. And I think right now sometimes I'm a little too bold. That's great. Mr. Keith out from South LA, which speaking of, I'm excited to be in LA with you guys a little more often lately. Yeah, yeah, yeah. We're happy to have you. Well, stay safe. I wanted to run something by you. Obviously, there's turmoil in the financial markets.

2:27:21We were pitching something called the yard sale theory of financial markets where basically every ski season, the capital allocators go, they're speaking freely on the ski lifts together. They know no one else is listening. They share stock tips and then the market crashes. And so if you look at like Theranos, it happened during ski season. FTX happened during ski season. Enron was discovered during ski season. What do you think of that? Or why do you think the market's going down right now? What's gone wrong? um you know there is a like uh historical seasonality to like the stock market i remember you know sort of seeing something similar where it was basically the past like you know sort of 50 years of the steepest dry downs of the s &p 500 something like 80 of them happened between like october and february there's a component of that that i'm sure is also like tax season related where like people want a lot you know sort of gains versus losses at the end of the year but not too closely you know sort of coupled to it i'm sure there's a component of it is you know people sharing stock tips in Aspen.

2:28:20There is also the presidential transfer, whether it's sort of this year or any prior year, always happens at this time of year, which also introduces volatility, and people don't like volatility. The one bull sign that I'll say is, I was just looking at this, I don't know if you guys know this website, Truflation, which basically tries to do like a week-to-week analysis of inflation, just tracking grocery store prices, et cetera. And it is actually showing like a pretty steep drop over the last 15 months. And so I'm a little bit of a believer of like the Scott Besant, you know, there is going to be a detox period.

2:28:51Sure. Now, I think that some of the moves that the administration are making feel like a little blind and they clearly are sometimes pulling things backwards. Like you do the tariffs, you roll them back, you do a bunch of layoffs. And then some of those layoffs, like, you know, I was just reading today where like they laid off a bunch of like the NOAA commercial, remote commercial sensing team. And then there is a huge sort of backlash. And so some of those people got rehired like a week after getting fired by, you know, sort of doge and crew. So there is a little bit of like, I feel like they're taking, you know, sort of a chainsaw, which is not unreasonable when you need a scalpel because it's just like the scalpel may take too long.

2:29:24And the, you know, it only has two years before like Congress potentially flips. And so it's probably a reasonable, you know, sort of approach, but I think that's what you're seeing in the market is dear God, like the, you know, sort of president and Elon are taking a chainsaw to the federal government. And that's, you know, introducing some level of volatility. I like this, you know, you've, I'm sure heard, you know, sort of Peter say this a bunch, but I love his analogy on what is the US president and it's, you know, they're the mayor of the United States, but the dictator of the world in that they basically have infinite power over foreign policy, but actually pretty limited power domestically.

2:29:57And so there's so much of like the S &P 500 that's been propped up over the past couple of years by just like insane amounts of foreign inflows that it starts to become, you know, sort of very aggressive to some of our, you know, sort of partners and allies, and especially in Europe, you'll start to see some of that sort of flow out into their own domestic stock market, which, again, I'm not saying... I'm somebody that obviously comes from Eastern Europe, and I'm sort of crazy anti-Russia, and so I don't necessarily want us to totally concede to Putin, but at the same time, I also think it's important for our allies to finally get their shit together.

2:30:32Now, rearming of Germany, we've seen how that's gone the past couple times, so we've got to be a little cautious there. You never know. AFD, Elon being very pro-AFD, probably good. If AFT gets too powerful, you know, maybe we're back to Lebensraum. And so that's maybe a little, you know, sort of tricky. But, you know, the Germans probably could stand to be a little more, you know, prideful. Well, speaking on Starship, do you have a theory for how long, for why it's taking so long? Real quick before that, because it sort of leads into this. Right as the Doge stuff started to get very intense and was sort of top of mind, NASA just happened to come out and they said, oh, by the way, there's an asteroid.

2:31:08It's basically, it was like doubling every day. Put the tinfoil hat on. Yeah, yeah. I got to throw this on. We keep this nearby for incidents like this. For when we discuss conspiracy theories. Yeah. It was like almost every day it was like doubling the chances that an asteroid was going to hit in 10 years. And I was like, this is just like, it's 10 years out. It's particularly conveniently timed. That now we finally need NASA. Yeah, yeah, yeah. That was kind of the joke. But how do you have any insight into how into why they could have had an event that's far enough out that we have probably quite a lot of data on that?

2:31:48Then there could be that amount of variance in such a short period of time around something as catastrophic as impact. I'm going to bring up a totally unrelated point and then answer your question. the totally unrelated point is China has now confirmed that they're going to fly Pakistani astronauts to the Chinese space station now I'm not saying that Pakistan is like a huge sort of lover of the US or anything like that but I actually don't know too much about the general foreign policy history with them, do they like us versus China more, I mean China did basically invade their next door neighbor India but I know they hate the Indians so maybe because of that the enemy of my enemy is my friend and so maybe therefore Pakistan likes China But I think the interesting thing to think about there is that China is exerting soft power, not just for the Belt and Road Initiative and investing into infrastructure, but it's like, come visit our infrastructure.

2:32:39And it's starting to build up a coalition around that, because you can imagine that eventually turning into Pakistani astronauts visiting the Chinese lunar station. And I don't know if Pakistan's good at a lot of things, but maybe they're good at having some of their folks go up there and be sort of lunar miners that may have a very high death rate early on. but you know maybe they're willing to you know sort of push for that so thinking about some of our you know sort of enemies you know coalescing around you know sort of stations in space you know potentially scary thing we got to think about what we do as america on the like asteroid tracking i i kind of buy it in that man it's so hard to track even on our satellite and we know where spacex dropped us off and like where things are going and that's like so close to earth the idea that like we have perfect track on these like asteroids super far out you know there is i think a lot of statistical variability.

2:33:25And then you have to like, you know, the reason that there was, you know, increasing, increasing, and then set and drop is I'm sure what was happening is we have a bunch of these like, you know, sort of deep space radar, et cetera, different assets. One of them starts to pick up, Hey, this thing is starting to get close. And then it may take some time for us to like spool up a bunch of resources. You probably need the earth to spin around a couple of times. You have like the Australian radar, et cetera, pointing at it. And then we just get better and better. And then all of a sudden it sort of drops down to zero.

2:33:49Yeah. Every time that, cause is it really felt like every day it was a sort of doubling effect. And it's very possible that it was like the Earth was just spinning around. We were getting another look at it. Yeah, that makes sense. But yeah, going back to Johnson. You know, though, that we did a test run on this. So NASA, actually, about two and a half years ago, did a test run on what we would do if we had to deflect an asteroid. And so they basically slammed a satellite into an asteroid going crazy fast and then measured that they were able to adjust the course of the asteroid. How does that work exactly?

2:34:18Is that like there's already a satellite up there and they just task it to move a little bit to intercept? Or is this like we're going to launch a new rocket with a new satellite on it specifically for this? Like what's the tradeoff there? I think one of the things that helps with SpaceX, and this is both true for like space-based, like even stuff that VARTA sort of works on on the defense side, because Falcon 9s are basically going up like every 24 hours now. You don't have to think about this stuff as much as like fixed assets in orbit need to be ready to go because the difficulty with that is like now you have to think about like the longevity, the maintenance of that asset.

2:34:49You have to sort of replace it because what people don't realize is like if you're up in low Earth orbit, it's not like you get to be up there infinitely because like there still is a little bit of atmosphere up there. And so you have a little bit of drag. And so if you're like 500 kilometers in the size of a VARTA satellite, you'll still deorbit over the course of five years and basically come back down. And so with something like that, we could actually just like, you know, have the satellite basically ready to go in a storage facility down here on Earth. The moment we know the asteroid is starting to head towards us, then, you know, basically go launch it.

2:35:13And so they've demonstrated that, you know, sort of now, you know, in terms of like go launch the custom satellite and go send it directly to an asteroid and go hit it. And then in space, even though the satellite is like so, so, so, so, so small relative to the asteroid, the speeds are just so insane that like you're going at such a speed that it's like basically like a thermonuclear weapon getting like, you know, detonated on the asteroid at those speeds. and you can actually like adjust this thing's course. And if you're like, if you hit it when it's like seven years out, even like a 1 % adjustment is like a thousand kilometer, you know, basically like, you know, going off course, in which case you like totally miss the earth.

2:35:46And so, yeah, I don't think we need to be too worried about the asteroid stuff. We've gotten pretty good at, you know, detecting that and, you know, now showing that we can deflect it. Unless you have the, what's it called, Neil Stevenson book, Seven Eves. Oh yeah, favorite book. A little dot that goes through the moon. Yeah, then we're fucked. Well, so every guy thinks they could land a commercial airliner if required, right? It's sort of like, oh, I could do it. You probably actually could, given your experience as a pilot. But if we had an asteroid coming here, you'd probably secretly get a little bit excited because you're like, all right, yeah, it's my time.

2:36:18I'm the guy. I'm going to deflect the asteroid. I'm here to save it. Speaking of needing to land an airliner, as a pilot, if one were to ask me, what's your favorite situation if you had if you put me behind the cockpit of 747 you're like del you got to land this thing i would say i would want to be in the northern latitudes at daytime on a very cold day in the winter with super clear skies why because that's basically like the highest air pressure that you can basically get so the atmosphere is very um and at sea level so the atmosphere is very forgiving basically you have like a you know sort of ton of you know both lift, but then also when you sort of put your flaps in a ton of drag, it's basically almost like flying, like the equivalent of like, if you've ever seen the XKCD comic of like, if we had humans on Titan, which is one of the moons of Jupiter, you could actually just go out there with like wings and the atmosphere is thick enough that basically like we could just flap our wings as humans and fly.

2:37:11And so it's pretty surprising that, you know, a Delta pilot landing in Toronto in the middle of winter on a cold, clear day with super high air pressure, somehow flip that thing upside down. that is literally like should be the easiest situation to sort of land in. Well, we need to give you the tinfoil hat and you can tell us what really happened. I mean, you know, there's a lot of like DEI accusations going up there. Maybe it's, you know, the Canadians are starting to try to, you know, fight back against the trade wars by, you know, making our planes flip upside down. Yeah, UFOs or something.

2:37:41Who knows? Talk to us about SpaceX last week. The haters, the space haters were taking a victory lap. what's your take on the situation as an entrepreneur who's building on top of SpaceX infrastructure? I guess the big question is, why is Starship so much harder than Falcon 9 on this? Walk us through some of the complexity there. Yeah, you have to remember, Falcon 9 was, in the early days, ultimately based off of technologies that had a ton of heritage. There wasn't really anything that was that totally net new, other than as they started to, you know, sort of do the landing lags and the grid fins, right?

2:38:20And those were obviously very, you know, so net new. And as we saw, it took them like, you know, basically on the order of, I remember, like the first landing was like 2014 when it really got operational. I would argue it was like sort of like end of 2019. So it was still like a five, five and a half year. And by the way, they were trying to land for like two years before that. So call it like two years of lots of failed tests, five years, even from when the first test succeeded to when it became operational. That was obviously, in some ways, a much simpler vehicle. It was smaller. It was based off of technology that had a lot of heritage.

2:38:49Everything from the metals they were using, the way that the rocket engines were designed, there was a lot that already had a ton of heritage. As we flip over to Starship, those technologies just do not scale to the size of Starship, especially as they started to think about distributed engine architecture, or they wanted to be able to reenter, et cetera. So Starship is both a huge leap in size, But you're also like discarding this whole history of aerospace that you can previously you're building on top of. And so the fact that they've even made it this far this quickly is, I still think, astounding.

2:39:20Obviously, the company is a lot bigger. They have more resources. You want to push for like, hey, they should be able to make, you know, sort of faster progress. But I don't see it as any sort of like existential, you know, sort of risk. I think it's just that the company is way more high profile. Like in 2013 and 14, where all these rockets were like landing and blowing up, I don't feel like there was like huge news cycles around each one because Elon was like a loved lib, you know, that, you know, the media, you know, treated as like a darling versus like, you know, he's, you know, seen as a Nazi.

2:39:47And so anytime anything ever so slightly, you know, goes wrong, they're trying to, you know, sort of attack him. I mean, SpaceX even turned all the crashes into this like vibe reel with like in the Hall of the Mountain King playing. And it was like celebrated by everyone. It was like, oh, yeah, they blew up so many rockets. This is how progress happens. It's awesome. It was great. Yeah. And now it's like, oh. I don't know if you guys saw, actually, Kiko Dunchev, who's the VP of launch at SpaceX, actually just wrote, maybe it can be one of the tweets that you guys discussed at some point. But he just earlier today, like two hours ago, wrote this super long tweet to a random SpaceX fan Twitter account, basically asking, like, what's going on?

2:40:20Why are things taking longer, et cetera? And if you want, I can even text it to you, too. I don't know if it's something you guys can do. Yeah, we should pull it up right now and maybe walk through it. Yeah, let me text you the – I got it here. I found it. Oh, you got a Kiko Dunstaff? Yeah, cool. It's like this long, you know, sort of super long reply. But it was basically like, look, like, you know, they are just flying a lot. Because Falcon 9 has also had more issues over the past, you know, sort of six months than like the prior, like, five years, you know, sort of combined. And I think you get it from his point.

2:40:45It's like, you know, sort of look, some of these boosters are getting, you know, sort of a lot older. Also, just like the sea conditions, you know, off of, you know, Florida have actually been, you know, sort of pretty crazy. And so that's been more refurbishment. We're now starting to learn what happens when something flies 12, 13, 14 times in a row. And so we still have a long ways to go until like Falcon 9s are at the level of safety of like a 747. But remember with commercial aviation, from when like the first jet tube, you know, sort of airliner came on to when we basically stopped having deaths other than let's ignore the DC thing, you know, which, you know, more has to do with like air traffic control than it does with like the jet.

2:41:17It took us on the order of like 50 years for those things to become very, very safe, right? Like we basically had lots and lots of airliner crashes in the United States until 2012. And then in 2012, they basically stopped or maybe it was like 2010. And we didn't have them for like 15 years other than this like DC thing. And so I'm sure Falcon 9s will get to that point, but it may be like 30 years of finding all the weird edge cases, atmosphere, this sea condition, this thing, before these things are as reliable as commercial jets. And they're more complicated than commercial jets are. Oh, one analogy that I like to bring up that some of the viewers might like.

2:41:45People think about how expensive is it to go to space, et cetera. If you think about it on like a unit of fuel of like how much fuel you need to get up there, the amount of fuel that it would take for somebody to transport us from like London to New York on a 747, that's basically the same amount of fuel, like hydrocarbon energy that you would need to get up to orbit. So it gives you a sense of like once you - On a per person basis? Yeah, on a per person basis. So at this point, if you think about your like tickets to, you know, from London, New York, it's actually mostly the fuel cost, right?

2:42:15Like they've largely amortized the airframes over so many passengers and so many flights that you're barely paying for that. And so to give you a sense of like what is the terminal cost of going to orbit, it's going to be roughly like a cross-Atlantic flight is basically like how much it should cost, like on the order of like 500 to 700 bucks for like an economy ticket. Interesting. Yeah. Great. That probably unlocks point-to-point as well then. Like the SpaceX point-to-point just like using the rockets to get from New York to Japan as well. Similar cost. Yeah, yeah. Yeah, I mean, obviously that's where it's like, okay, the rockets now have to be probably as safe.

2:42:48Because the people that are going to pay for that are going to be the richest people in the world. They're also going to be the most safety conscious, which is what I always think about when people are talking about these like faster jets, et cetera. I'm like, man, people are definitely willing to pay for some speed. But like rich people also really care about being safe too. So there is a little bit of this like – people claim, hey, I'm going to build the Tesla style. What was their first vehicle called? The expensive one and then the Roadster. Yeah, the Roadster and the Model S and the Model 3.

2:43:13of planes approach is like a little harder to do. Like the crazy people are more the like, you know, small, you know, sort of pilots like me that are a little crazier, but like, you know, I don't know that like, you know, Mr. Peter is, uh, you know, anytime soon. Yeah. Talk about Eric Schmidt going to relativity space. He's obviously been a big backer of the company. Uh, you've, you have some of your own opinions, uh, and then we'd love to maybe extrapolate, have you extrapolate a little bit on context we don't we don't we cover a lot of posts on x here but we we don't cover uh deleted posts so yeah that's probably yeah let's say there were some great deleted posts performing quite well um but you know the team here is all about not making enemies so i've got to play it safe the deep state the deep state came for you there's the problem with two jobs is you have twice the number of people that are trying to get you to delete tweets and so yeah i think i should have zero jobs that way i have zero x the number of people trying to get me to delete tweets i can't wait for that moment when you're just running your family when he's running his family office from mars and he can just say whatever he wants no but just talk generally so even if people ask me to delete it's like so late that it's like dude it's been up there for an hour already you know sorry let it ride you're just let it ride uh talk about relativity productivity as a company that presumably would want your business, you know, should it, you know, continue to make progress?

2:44:37Yeah, I mean, you have to look at it from our perspective, right? We have to sign launch contracts basically on the order of like two years out, because that's basically how long it takes us to like supply chain, plan things, build vehicles, etc. That's how far out our customer contracts are. You know, we plan on, you know, call it roughly that two year cycle. And so if I'm signing a launch contract two years from now, I better have that, you know, vehicle ready to go. Otherwise, like my customer is going to be disappointed. And all of a sudden, I'm like holding up revenue. And so from a commercial basis, it's like really hard to sign contracts with anyone but SpaceX right now, because no one's showing any level of repeatability.

2:45:10Like even though, you know, sort of Blue Origin has gotten to space, Firefly, Rocket Lab, etc. have, nobody's matched like the consistency or the price of SpaceX and nowhere close to it, right? It's like, you know, there's not even like an obvious number two, even anytime soon. It's like, for me to feel confident in, you know, let's say relativity, they would have to launch like this year, they'd have to probably do it multiple times and multiple times next year. And then might be maybe at the end of 2026, I would consider signing a contract for 2028. And so, man, that's like a really tough business to take over.

2:45:41You know, I think in 2017, the sort of consensus viewpoint in Silicon Valley was that launch was this commodity, there was going to be like, you know, four or five players, there was going to be very, you know, sort of low margins. And it wasn't going to be a place where you could generate many, you know, sort of venture returns. And it's turned out that it's actually quite the opposite. There's basically one player, SpaceX effectively represents 99 % of the market and has like insane profit margins on their launch business. It's something on the order of like, you know, sort of 50%, you know, sort of gross margin is like the rough report numbers that I've seen publicly.

2:46:09And so man, stepping in as Eric Schmidt into relativity, it's like, one, my understanding is he's basically funding the company payroll to payroll. That I always think is a really hard cultural place to be as a company because you're both on the brink of death, but then also you don't have an obvious death date. Yeah. The emotional sort of, you know, you might feel great about the company one week and the next week and the CEO is like, ah, should I, should I pull the plug? Is it time? Whereas funding, you're like, at least I'm funding for 24 months of runway and I want to see, we're going to have good weeks and bad weeks, et cetera.

2:46:46Yeah, exactly. Like, This is why I think a lot of these billionaire-funded projects where the billionaire has made it clear that they will backstop the company somewhat indefinitely without a clear end date have never really worked. Because you don't have this clear – I think what's become the magic of venture and how it's been staged out is you have this very clear window. You have 24 months. You have to accomplish a lot. If you don't, you're dead. And if you do, you get to march on to the next window. And there's a reason why Darwinistically, basically all of the best companies in the last 20 years have gone through those windows.

2:47:11And the ones that tried to avoid those windows basically haven't worked. And we can list so many examples of this. airship kitty hawk etc there's been like so many types of projects yep larry ellison has a farm he's spent like almost like a billion dollar he's like half a billion into it and it doesn't seem like it's going too well yeah and it's like i think when people try to avoid this and sell fun like i tell billionaires when it's like when you're going to start a company don't do the backstopping thing still race as much or participate alongside the venture rounds and make it clear that you'd like to invest in the company but predicated on like again hitting you know sort of these milestones and growth and so the thing that i think is really hard about this Eric Schmidt situation is like, you're both totally decoupled from the, like, we need to hit milestones in XYZ period of time.

2:47:51But also it's not like, you know, Eric has indicated I'm going to fund this thing for multiple years. You're sort of like, you know, on some indefinite, you know, time period, which is like the worst parts of both worlds. And then also SpaceX just continue to succeed. And there's other players like, you know, at this point, relativity was thought of in 2021, let's say, relativity was thought of as like the number two, because they had so much funding, momentum, et cetera. It's like, you're not even number three anymore, right? Number two is obviously very much so Rocket Lab. Number three at this point is Firefly.

2:48:19Firefly is actually getting to space on some regular basis. They just landed on the moon. I'm sure it's going to generate a ton of investor interest for them. Even though their prior CEO twiddled some diddles and had to get booted from the middle, the new CEO is hopefully not going to twiddle some diddles and block some rockets instead. Let's keep it focused on the rockets. Are there any – how closely do you track China's progress? Do they have anything that could be competitive with Falcon 9 in the next 15 years? I'm assuming they're stealing all of our sort of trade secrets actively. But it still takes, even if you have the master plan and, you know, even the schematics, it takes quite a lot.

2:49:00Is there a Chinese VARTA yet? There's an Indian VARTA as of yesterday. Yeah, it's actually in the latest white combinator batch. No way. Props to them. It was a very cool launch video. Okay, cool. That was awesome. I look forward to hopefully there being Chinese VARDA and African VARDA. I just want every continent. Aussie VARDA. Russian VARDA. It would actually be very bearish if you weren't getting copied at all. That's always my perspective. If you're not getting copied, then your idea is probably not very good. There are plenty of SpaceX copycats even today. Of course. On the Chinese side, they don't have anything that is anywhere close to landing, but they're clearly just willing to throw manufacturing and bodies at the problem, where I think it's something like SpaceX has launched 27 times so far this year.

2:49:44China has basically launched 19. So it's, I mean, in the grand scheme of things, it's like pretty close, I believe. They just, you know, are very good at manufacturing these things very rapidly and they're just pumping it off the line and just not dealing with reusability. And so it's somewhat been like there's a couple of Indian launcher companies that have taken that approach too. It was like, we're not even going to try and do reusability anytime soon. We're just going to make these things super, super, super cheap. And then at some point we'll think about reusability down the line. And so the Chinese are definitely like, if it weren't for SpaceX, man, there would be like red panic bells all over the place.

2:50:15You know, sort of God bless that SpaceX has actually succeeded the level they have. Otherwise, we would be like very far behind the Chinese. Is there is what's the chatter within the space industry of, you know, we've seen plenty of, you know, undersea cables being cut. How worried is the average space founder generally? like how worried are they about sort of sabotage is that something that's sort of like a risk factor in a in a series c deck where they're where they're like you know uh you know is that is that even the right question to ask i would say like not too worried and it's not to say that it couldn't happen or anything and we should underwrite this but it's like the the thing that would be really bad is if like russia basically you know nuked uh uh low earth orbit you had a three-minute nuclear weapon, and you had a bunch of highly charged ion particles basically orbiting around Earth at a much lower level than where the Van Allen belt is, because it would basically destroy everybody's LEO business.

2:51:14Right now, part of why Starlink works is they're low enough in orbit that the Earth's magnetosphere basically deflects the solar winds, so you're still relatively protected. If that all of a sudden becomes a very unprotected zone, you have a ton of radiation, man, everybody's economics basically just blow up. Actually, one of the few that probably doesn't blow up is BARDA because radiation basically screws you on a day-by-day basis, and we don't need to be up there for very long. But anybody whose business case is built off of, like, being in space for a longer period of time, man, if the Russians launch a nuke up there, that'd be really hard.

2:51:45And I haven't seen any, like, how one would fix that problem if they did. Like, I don't think that, like, there's even, like, a hypothesis for how to do that. Like, you know, maybe some, like, really big magnets or something. But I don't even know. They'd have to do massive magnets up there. So I don't know if, like, the Russians detonated a nuke. And I can see them doing it where like they just keep falling behind. They see Starlink helping Ukraine. They see that like, you know, the United States is like winning this like, you know, new space race, you know, sort of 3.0. And like, you know, us and China are leaving them in the dust.

2:52:11And Putin is like dying breath. It's just like, screw it. Nuke space because it's like you're not killing anybody. But you're just tanking all the commercial space economies. That'd be tough. Don't like it. Yeah, it feels like most of the opportunities in space should be pursued by private companies. that said stuff like thermonuclear radiation cleanup in low earth orbit and like asteroid deflection are probably better suited for nasa and or sort of nasa private partnerships just because varda yeah you'd be a good candidate to potentially you know save us from an asteroid but it's not a good business model where you're like okay we have to like develop technology maintain it like carry this team but then maybe you never have to use it across 30 years it's not going to be necessarily a huge profit center yeah i mean i don't think we're so religiously libertarian at founders fund that we believe the government has no use whatsoever um so you know there is the occasional need for something that is you know of the public good and asteroid deflection and thermonuclear cleaning is probably you know shit up there with that uh but yeah i mean hopefully diplomacy is more effective than having to do the cleanup you know sort of part of it yeah makes sense well this is awesome i think we got to wrap up but uh thanks for closing it out Thanks for coming out.

2:53:22Oh, yeah. Thanks so much for having me, boys. And congratulations on a phenomenal launch day. Look forward to seeing the success of TBPN. Come back next week. Hey, we expect a cameo on the next video. It's already in the works. True. You cameoed in this one in your post. In this video. An iconic post. Oh, yeah. Oh, yeah. I mean, look, everybody needs an island vacation. But, you know, Reid Hoffman really needs one. You had a face cameo because we used a clip from your call-in. I wasn't talking about the tweet. You had two cameos, I guess, technically. Yeah. Oh, I had two cameos. You had two cameos.

2:53:51because at 37 seconds, 38 seconds, you pop up for a second as an example of one of the guests that we've had. Double cameo. Well, I like my first cameo better than the second one. Your first cameo is good. But yeah, a little bit of an Easter egg. Fantastic having you on. Goodbye, boys. Awesome. We'll see you soon. We'll talk to you soon. That was great.