Meta–Scale AI Deal Tensions, Ken Griffin’s Next-Gen Finance Empire | Arielle Zuckerberg, Mike Maples, Andrea Hernández, Farooq Malik & Charles Yoo-Naut

27:22Guess how cheap these lease deals are. How cheap? As of last week, this Kia dealership offered to lease the small Niro EV for$40 a month before taxes. The EV6 lease was being marketed for less than$100 per month. And the 65 ,000 three-row EV9 SUV can be had for$189 a month before taxes. Can you imagine getting a car for$40 a month? That's so ridiculously cheap. Okay. And so there's some really weird... It's a bubble. It's not a bubble. It's like the popping of a bubble. It's like the end of a bubble. It's like they overbuilt and they made all these and no one wants them. We're giving them away.

28:02They got to give them away. But yeah, very, very bizarre times in the EV market. There is an interesting wrinkle that I was listening to. A couple of the Tesla engineers did Jay Leno's show recently. And they were talking about how the EV tax credit is going away. So you can't just take money off if you buy it. But if you get a loan, an auto loan, there is an interest tax deduction for EVs now, for American-made vehicles. And Tesla's the most American-made vehicle. And so you can still deduct something like, I don't know,$8 ,000 or$10 ,000 off your taxes. So there still are some incentives for Tesla.

28:43So it hasn't gone away completely. But if you buy cash, it's not an option. Anyway, the master plan part two. Number one, create stunning solar roofs with seamless integrated battery storage. It's kind of happened, but not as major as I feel like it should have. It's still kind of early days there. Two, expand the electric vehicle product line to address all major segments. And so that obviously foreshadows the truck, but it also foreshadows the full-size SUV, which I think we're teasing now. But it should also be, we need a convertible. We need a minivan. Like we mean, you know, every major segment means every major segment.

29:26I think. I don't know. Should Tesla make prefabs? Prefab homes? Yeah. I don't know. I think Elon can sell homes. Maybe. I think the Elon army could get pretty into just buying a piece of land and dropping a little electric box on it. Live in the pod. Live in the pod. Potentially. Then this is where self-driving comes in. develop a self-driving capability that's 10x safer than manual via massive fleet learning. I think that's going very well. And then step four is enable your car to make money for you when you aren't using it. Isn't that crazy? 2016, he said that. He said like, you buy the car and then you're going to be able to put it in the robotaxi like army.

30:07Passive income. Very, very early. And then part three comes out and it's hilarious because part three switches from like a, like the first master plan is probably like, I don't know, like a two page blog post. Very readable. You can just kind of cruise through it. There's one table. There's a lot of summaries. Master plan part three is a 41 page PDF with like a bunch of diagrams and like all these crazy things. It's so much more detailed and it goes into like trucks and all this other stuff that they're trying to do. It's a pretty remarkable document. And then now he is into Tesla Part 4, which is much more high level talking about sustainable artificial intelligence.

31:01As the influence and impact of AI technology increases, the mission set forth in Master Plan Part 4 should come as no surprise. The next chapter in Tesla's story will help create a world we've only just begun to imagine and will do so at the scale we have yet to see. We are building the products and services that bring AI into the physical world. We have been working tirelessly for nearly two decades to create the foundation for this technological renaissance through the development of electric vehicles, energy products, and humanoid robots. We need a polymarket on if XAI and Tesla will eventually merge.

31:33that does seem like a logical end state here um innovation removes constraints it's all very high level i mean i think the the a lot of the uh a lot of like the big reveals have kind of already happened like you know the the idea of a robo taxi fleet the idea of autonomous or optimus the autonomous does it cover humanoids yeah they yeah optimus our humanoid robot is is changing not only the perception of labor itself, but its availability and capability. Jobs and tasks that are particularly monotonous or dangerous can now be accomplished by other means. In this way, Optimus's mission is to give people back more time to do what they love.

32:14And so he walks through a bunch of different pieces of this. You just want one thing from Optimus, which is to keep the Tesla diner open 24-7. It is crazy. So we work just a couple blocks away from the Tesla Diner, and so I drive past it every morning. And when I think of a diner, I think of a New York City diner that's open 24-7. And every day I drive by it and it's closed. And it's so crazy. I mean, I guess it makes sense because it's still early days and kind of a marketing stunt. But really, they got to keep that thing open. Keep it going. Keep it humming. Anyway, if you're designing your next mission document.

32:54Do it in Figma. Think bigger, build faster. Figma helps design and development teams build great products together. You can get started for free at Figma.com. On the Tesla Diner website, it says 24-7. It does? Yeah. And I'm pretty sure at least the first week it was open 24-7. Okay, so we're spreading fake news. But it also looks incredibly empty, at least when we drive by. I mean, that's just LA, though. That's not his fault. If it's open, it's up. We'll go there for breakfast tomorrow. Yeah, maybe I'll stop by on the way at 6 a.m. and see if it's actually open. It seems, I mean, there are definitely people there, like, cleaning and stuff, so maybe it's open.

33:32But, I mean, there are truly not that many places in Los Angeles where you can get a burger at 3 in the morning. Like, L.A. is not the city that never sleeps by any means. Yeah. Anyway, Citadel Securities is... There's some interesting highlight here. So Power Bottom Dad sucks. Quoted our post announcing Anthropic Series F and says SBF got so F'd, man. I just did the numbers quickly. SBF stake in Anthropic or not SBF. FTX's. FTX's stake would be worth just under$15 billion today. So plenty to plug that hole. So duration mismatch problem. um i guess in uh i guess gavin newsom went on pivot and says he's going to be releasing a meme coin to challenge the trump token is that real he said that i wonder if he's like trolling or something it feels very off-brand i don't know you never know anymore i haven't really been following the gavin newsom thing brandon was saying that uh like he's been like kind of trying to mirror trump in terms of like what if trump does something crazy he'll try and do something else that like kind of matches that the energy matching the crazy energy and it's i mean he's doing numbers it's a it's a bold move cotton yeah see how it plays out yeah i guess trump is uh was slated to do announcement at 11 a.m pacific he is uh 43 minutes late right now apparently so So hopefully he can get on to that announcement soon.

35:16Citadel. Security is set to pay an average employee$2 million a year. In the first half of 2025, they did$5.7 billion in revenue,$2.6 billion in net income. They paid out$1.8 billion in comp, and they have 1 ,800 employees. Their CEO, his name is Peng Zhao. He has a PhD in statistics. So it turns out being good at math is good for your income. 19 years at Citadel. Look at that. Quant researcher in 2006. There was something else about, I think, Hudson River trading. Overall profit at Hudson River trading was$3 billion for the first half of the year, which is higher than Citadel Securities,$2.6 billion in net income in the first half of 2025.

36:06So they are putting up some crazy, crazy numbers. Well, Ken Griffin's on the cover of Barron's this weekend. I thought it would be fun to read through this because he actually gave some choice quotes in here. Is this not a silly, kind of a silly picture of him? Yeah. I'm not, I'm not. It looks pretty heroic. I think it looks good. We're looking off at him. Sort of. I mean, the angle's fine, but I'm just saying they kind of did him, they did him a little dirty. What about it? The coloring of the cheeks or something? I think it looks good. I just, I don't know. I think they made him look a little bit silly.

36:35They should have given him the GigaChat filter and made his jawline a little more fun. If you're going to draw somebody, at least make them a GigaChat. Yeah, I would have liked to see more shoulder definition here underneath the suit. It looks great. The most successful companies on Wall Street have been built by those with relentless ambition and a strong wind at their back. Decades of deregulation helped growth-minded CEOs turn firms such as Morgan Stanley and Bank of America into behemoths. More recently, financial entrepreneurs have leveraged booming private markets to create the likes of Blackstone in private equity, Bridgewater in hedge funds, and Andreessen Horowitz in venture capital.

37:13Now, a somewhat stealthier trend fueled by the explosive growth of technology and finance is behind a new wave of digital-first powerhouses, such as Interactive Brokers Group, Susquehanna International, Jane Street, and especially Citadel, a burgeoning Wall Street empire controlled by billionaire Ken Griffin. Citadel is a two-headed business beast, consisting of Citadel LLC, a$68 billion hedge fund operation best known for its top performing multi-strategy flagship Wellington and Citadel Securities, a sprawling market maker that facilitates and engages in the trading of stocks, derivatives, and increasingly bonds.

37:52Citadel Griffin chose the name because it denotes a place of strength and protection. Fantastic nominative determinism. If you're picking the name for your business. Pick something strong like that. He says, is defining the prototype of the next-gen bulge bracket firm, except that Citadel isn't that bulgy with just a fraction of the employees and overhead of the traditional Wall Street firm. As of now, the boss is happy. Quote, it's incredibly satisfying to run one of the world's most successful hedge funds and to witness the transformative impact of Citadel securities on the capital markets around the world, Griffin says.

38:27Great quote. Yes, I'm proud of that. Taken separately, first hedge fund Citadel is a huge deal. This is how you do an interview. This is just marketing. Yeah. It is incredibly satisfying to run one of the world's most successful hedge funds and to witness the transformative impact of Citadel Securities on the capital markets. Do you care to comment? Yes, I will take the self-glazonator 2000. Wellington, not related to Vanguard's Wellington Fund or Wellington Management has been a superstar, producing annual average returns of 19.2 % net of fees since inception in 1990, nearly two times the market.

39:07And I believe, so a million dollars invested in the fund now is now worth$452 million. Insane. The other crazy thing is that I'm pretty sure they had a 50 % drawdown during the mortgage crisis. So in 2008 or 2007, I think they went down 50%. They went from maybe like a$20 billion fund down to$10 billion or something like that. Ran it back. And I remember one of the traders there, uh, cause I, I interned there and he gives the story of like, during the, during the crisis, he, he was trying to like, he was trying to like explain how important it is to understand how percentages work. And he was like, yeah, I walked outside and my neighbor was like, Oh, like, how's it going?

39:44Uh, he's like, uh, Oh, it's, it's terrible. We're down 50 % this year. And he was like, and then next year I was like walking outside and ran into my neighbor again. He's like, uh, like, how's it going this year. I know last year was pretty bad. You were down 50%. And, uh, and he said, Oh, well, we're doing a lot better. We're up 50 % this year. And, uh, and, and the neighbor's like, Oh, great. So you're back to where you started. And he was like, no, that's not how it works. And this was like his way to, his way to explain to interns, like the way, uh, the importance of understanding percentages or something like that.

40:14It was just a funny anecdote. Uh, there was a surfing yesterday. My buddy pointed out this guy, uh, he was like that this guy was absolutely shredding, just getting a bunch of great waves. And this, my buddy pointed out, he said, that guy's lost all his LPs in 08 and just like packed it up, bought a house in Malibu and now just basically retired, runs his own money and just surfs like three times a day. Wow. Living a great life. Anyway, let me tell you about Vanta, automate compliance, manage risk, improve trust continuously. Vanta's trust management platform, takes the manual work out of your security and compliance process, and replaces it with continuous automation, whether you're pursuing your first framework or managing a complex program.

40:57Anyway, back to Citadel. Even though Griffin says he spends the majority of his time working on the hedge fund's investment portfolio, arguably the hotter ticket is Citadel Securities. CitSec, as it is known, is a complex, sometimes controversial, ever-evolving endeavor, which Pac-Man-like is on a seemingly inexorable march across the capital markets, gobbling up market share in options, equities, treasuries, and corporate bonds, and now expanding to Europe and Asia. Example, SITSEC recently bought Morgan Stanley's U.S. equity option market maker business, leaving no major banks in the market making business.

41:33Citadel Security now trades 25 % of all U.S. equities, including 35 % of retail flows, plus 45 billion option quotes a day, and is a top three trader in U.S. treasuries and swaps. In total, it executes$652 billion in notional trades a day. The goal is clear. Quote, building the capital markets firm of this generation is a vision that is increasingly becoming a reality, says Citadel Securities CEO Peng Zhao, who holds a doctorate in statistics. I like how you're just casually giving an ad to Patak right here. Of course, of course. Begin your tradition. Cubitus. Begin your tradition. By the way, Trump is currently live on Fox News, and he's looking good.

42:21So I am happy to see our president doing well. What is he announcing? I've got it muted right now if somebody else is... Moving the space headquarters. Yeah, the big announcement is they're moving Space Command. I think it was in Colorado moving to Alabama. Wow. I'm pretty bummed he didn't rip the speech isn't over, so hopefully he still rips the collared shirt off and has a Superman. Tyler, does anything ever happen? Nothing ever happens, bro. I was pretty sure that he had passed away. You thought he died. You thought he was dead. Nothing ever happens. We need a gong for when nothing happens.

43:08We need something. We need some activity that we can do. It's a gong that is so reinforced that it makes no sound. Oh, yeah, that's good. That's good. Just a cement block. It looks like a gong. It looks like a gong, but it's stone. So it makes no sound. It makes no sound. It's a wah-wah-wah-wah-wah. Play the wah-wah sound. Nothing happens. Not that we're hoping for bad things to happen, but I was hoping for something exciting to happen, something positive, hopefully, some amazing trend deal. This is positive. I was disappointed to see a lot of the internet like clearly was, was, um, not, not, uh, was hoping that there was something wrong with his health.

43:48Yeah. Yeah. Obviously that's very negative, but this could have been some crazy 4d chess trade deal, re-invital reinvigoration of the American economy, investment in AI. Like it could have been like, this doesn't feel like market moving to me. Right. Hopefully. I mean, God willing, he finds a way to move. We got to find out a way to trade this. I mean, is there some Alabama real estate development company that benefits from this? Who knows? Anyway, Alfred Lynn is in Barron's. He says, this is a very different company than most people understand, says Alfred Lynn, a partner. The stock did. What stock?

44:27I mean, DJT, True Social did pop a little bit when it went live. Okay. So that was the trade, everybody. is if you were long Truth Social going into this announcement, you... Well, that makes sense because Truth Social is a social network. So whenever news breaks, there's a bunch of people on there and they sell ads against that. And that's why people are investing because it's probably good for their financials, good for the bottom line. Not a meme at all. Yeah, what about you? On Polymarket, this would have been good trade. So there's what will Trump say during announcement today? And one of the choices was emergency.

45:02and it was at 64 % right before it started and now it's at 30. So that was a pretty big move. Okay. Wait, so it's going down, but he still might say it. He could still say it. I think it's just the word. Yeah, so so far he's said China, Russia. Is he taking questions from the audience? Is he reading chat? He should be. He should be. Thank you for the 20. Thank you for the 20. I'm not saying emergency. I know you're on Polymarket right now. anyway Alfred Lynn chimes in to explain what's going on at Citadel he says he's a partner venture capital firm Sequoia Capital of course he's been on the show and whose brother happens to be the head of global fixed income and macro at Citadel the hedge fund we completely missed that scoop on the show we should have been hammering him about his brother Citadel is taking math and their distribution and technology power to price risk using techniques not traditionally used on Wall Street.

46:08While technology has been absolutely critical to Citadel's success, so too is Griffin's strategy. You don't want to go up against the Wall Street incumbents, he said. Instead, you want to understand where the market is heading and position yourself there before incumbents arrive. The incremental rise of electronic trading allowed Citadel to move step-by-step ahead of names like Goldman Sachs and Morgan Stanley and a number of trading businesses. Griffin makes all kinds of headlines. He's a Republican who has mostly given hundreds of millions to GOP candidates. And Griffin has praised and criticized Trump.

46:41Just this past week, Griffin told Barron's, I hope President Donald Trump appreciates that while he can score political points by attacking Jay Powell, ultimately the independence of the Fed is of the utmost importance to the American and global economy. Meanwhile, Griffin, 56, has been adding to his personal portfolio at a stunning pace, including buying over a billion dollars worth of real estate in New York, the Hamptons, London, Central Bay, Hawaii, and multiple properties in South Florida, including a$400 million compound in Palm Beach, according to the Wall Street Journal. His art collection is worth a billion dollars.

47:18It includes work by Picasso, Van Gogh, and Warhol. And he has a lot. A couple names. Priceless historical American documents. including rare copies of the U.S. Constitution. RIP to Constitution Dow on that one. He bought the Bill of Rights. I can't believe I saw that. That whole saga was so insane. Crazy times. He mogged the entire on-chain economy with that one. Yes. He owns the 13th Amendment signed by Abraham Lincoln. He also owns a$45 million Stegosaurus. That's crazy. Crazy, yeah. When I worked at Citadel in Chicago. You've got to do more dinosaur investing. I think he kept two Phantoms parked in the garage with two drivers, like, ready to go.

48:04So you, like, never knew which one he was in or something. He had some crazy, crazy, crazy, crazy choices. It's a good setup. I think he also had some sick hypercars down there. I forget. Anyway. Keep them handy. He's doing some philanthropy. He has a cool name for it, too. Griffin's Philanthropy, now directed through an entity called Griffin Catalyst. General Catalyst. The move over general catalyst, Griffin catalyst, exceeds$2 billion and includes funding Operation Warp Speed on the hipper side. He recently donated$2.255 million to Mr. Beast's water philanthropy after the YouTube superstar called him out on the Today Show.

48:44It seems very important to Ken that the world knows how wealthy he is, says a business associate. A lot of other people go to great lengths to keep it the other way. Interesting. He's less secretive. Contrarian. The totality of Griffin's world is dizzying. The billions upon billions of hedge fund investments, market making activities, and personal assets are markers of a man with great aptitude and perhaps even greater ambition. Along the way, Griffin and his companies have encountered friction, false starts, falling outs, fines, and failures. The hedge fund dropped 55%. This was what I was referring to.

49:19Losing$9 billion of clients' money during the 08-09 financial crisis. and was on death's door. SitSec tried and failed to get into investment banking. Yeah, they were going to become an investment bank and then they were going to IPO the whole firm. But then investment banks had such a bad stench on them after that retail was not going to be a fan and so they stayed private. Very interesting decision to go back and forth on that. The market maker has had a number of run-ins with regulators yet now after more than 30 years in business the tumblers have begun to fall in place. A decade ago, Griffin was worth a mere$6.1 billion.

49:54Today, his net worth has ballooned to$48.3 billion, making him the world's 31st richest person. Let's hope he can crack the top 10 by the end of the decade. He has an 85 % stake in the business, plus an 80 % stake in the market maker, the latter being valued at$22 billion three years ago. And like Citadel Securities has obviously grown a ton. He sold a 5 % stake to Sequoia. Never mind the real estate. I never knew that. Yeah, Sequoia. That's crazy. Yeah, yeah, Sequoia. I'm sure I wonder if Alfred did. I'm sure they broke her the deal. There's some good color in here. I thought we ran hard at Goldman.

50:37Pablo Salame, the co-chief investment officer of the hedge fund, who came from Goldman Sachs in 2019, said to a colleague, and then I showed up here, and I realized there's a whole different gear. Griffin is co-chief investment officer and CEO of the hedge fund. I would tell my team, you're playing for Real Madrid, says a former Citadel executive. You don't get to keep your spot on the field if you're not producing. Ken would call you on a Sunday night at 11 p.m., and he might be screaming and yelling at you, but he was working, says another former employee. He demanded 150 % and nothing else in your life should matter.

51:11Ken's not yelling at you. He's yelling with you, joked a person close to Citadel. I'm not yelling at you. I'm yelling with you. We're yelling together. Citadel Securities and Hedge Fund Citadel are highly performant places to work, says Matt Kulak, CITSEC COO, who has worked at the firm for 13 years. This is a place to come if you have a lot of confidence in your ability and you want to challenge yourself. It's true that Citadel hardly has an issue attracting aspiring masters of the universe. We had over 100 ,000 applicants for our summer internship program. Our acceptance rate was 0.4%. People are falling over themselves to demonstrate they deserve to be here.

51:47just for the summer and some subset of them get to come back full time. Griffin was STEM smart and achiever in his earliest days, growing up in Boca Raton, where he was president of the high school's math club. He graduated from Harvard with an economics degree in three years. Chapters of Griffin's origin story have become the stuff of Wall Street legend, like pursuing Harvard to let him install a satellite dish on the roof of his dorm room so he could trade convertible bonds. That's sick. After Harvard, Griffin moved to Chicago where Frank Mayer, a pioneering hedge fund investor, mentored him and helped seed Griffin's hedge fund.

52:21The best advice I've ever gotten was from Frank Meyer, who in the early days of my career really pushed me to think big, says Griffin. Meyer also pressed Griffin to build a multi-strategy platform instead of a single strategy fund. Griffin stayed in Chicago until three years ago when he says he became disgruntled with the crime and business environment and relocated his companies to Miami, a triumphant return of South Florida's most successful financier native son. One thing I'm confused by, I don't think Ken Griffin owns any horses, which is strange. Yeah, there's no evidence of it. And maybe he's quiet about that.

52:57Maybe he wants to be loud about art, but then quiet when it comes to horse racing. There was a question, Raghav asked, what's the update on Tyler? Has he dropped out? Tyler, any updates? Give us the update. The chat wants to know. Yeah, I've moved. Oh, I forget the LeBron. I've moved my abilities. Yeah, I've taken my talents to Los Angeles. Whoa, let's go. Gap semester. Tyler's on a gap. Wait, did we ever do the trading card with gap semester? No, we should. Oh, we've got to do that. We should. Throw it up. Throw it up. Throw up the gaps of the official gap semester. Tyler couldn't miss the great lock-in.

53:39Yeah, he had to lock in. He had to lock in with us. The great lock-in of September. The Citadel strategy is fascinating. You know how they started trading convertible bonds? Literally like the convertible notes that everyone knows about in Silicon Valley. Companies have those. And they're pretty illiquid. So he would figure out how to price them, buy them, sell them. But eventually he scaled the firm to the point where he basically maxed out the market size. They were the most dominant convertible trading shop, convertible debt shop in the world. And there was nothing more. And so they set up a high-frequency trading firm, got into quant stuff.

54:16Everyone thinks about them for, if you're thinking about them in the 2010 era, you think of them as a high-frequency trading shop. But they also had a global macro fund that took like 4 ,000. I hate to interrupt, but let's give it up for global macro.

54:31They took like 4 ,000 meetings with CEOs or something like that of public companies. And it's fascinating because how would that not produce alpha? You know, it's like, it's like, obviously, like, you don't need to be insider trading to just talk to the CEO. They don't share any private information, but you can just get a vibe and you can understand, oh, they know how they're talking about the business. I'm optimistic about this particular business or like this CEO sounds like he doesn't know what he's doing. He's lost. Like he's talking about a strategy. He's not telling me anything that's non-public, but it seems dumb.

55:05If you talk with somebody for 10 minutes, that's almost always enough time to say, holy bearish. Holy bearish. And it's so funny because you don't need to be insider trading to just talk to the CEO, get a vibe check, and then actually go and execute a trade against that. And so that's why I've always been so bearish on retail traders because it's like, this is who you're going up against. You're going up against someone who gets to sit down with a CEO in a private conference room and have a conversation. And then also have expert research and all these other things. Yeah, and people like to bring up that Citadel has a hedge fund in the market maker and how that could be a potential conflict.

55:47But apparently, Ken believes the greatest risk to his business is regulators. And so he's not willing. He doesn't take risks around that. Basically, there's like an extreme firewall. And they take compliance extremely seriously because you can imagine, like, again, he's not so threatened by the hedge fund that's trying to be the next Citadel, right? He feels threatened by it. I was reading Caesar Palace Coup. What's that book called? The Coup on Caesar's Palace. I forget. What is it? On my Audible. the the caesar's palace coup fantastic book how a billionaire brawl over the famous casino exposed power and greed of wall street it's about apollo uh buying uh harrah's casino and then turning into caesar's um and they all came out of uh the michael milken crew basically at drexel and uh milken of course uh was indicted on like a ton of counts of securities fraud for insider trading during like the 80s.

56:58And Milken had a very different approach to regulators. He was like, at least he was like quoted in some book saying like the regulators are like making the market inefficient. Like the market should be a lot more efficient without the regulators. And like the courts did not look kindly on that. And he went to jail and got slapped with a bunch of things. But he was pardoned in 2020, which I think means technically he did nothing wrong after the fact. I don't know. Did nothing wrong. And he went on a great run. John actually in the chat was asking if we'd covered Anthropix round already. We did early on.

57:35They raised$13 billion at$183 billion. He was asking if that was the largest round ever. I think that OpenAI is the only company that has raised more as part of their$40 billion funding round. But that was tranched out, right? It wasn't$40 billion at once. So certainly one of the biggest fundraisers of all time. World Liberty Financial started trading on the blockchain yesterday, went out at an$8.6 billion valuation, now trading down at 6.2. This is the company with a lot of co-founders, right? I think so. Yeah. Yeah. Yeah. No, a co-founder emeritus is a great new title. I think Donald Trump is a co-founder emeritus, which I think he means he's not day to day because I think he's tied up.

58:33I mean, yeah. So the president is a co-founder emeritus. Eric Trump is a co-founder. Donald Trump Jr. is a co-founder. Barron Trump is a co-founder. Chase Harrow is a co-founder. Zach Folkman is a co-founder. Stephen Whitcoff is co-founder emeritus. Zach Witkoff is co-founder. Alex Witkoff is co-founder. And I think that's all the co-founders that they have. But World Liberty. Do we know their stated mission? I mean, it seems obvious. It's bridging legacy finance and the open economy with purpose-built on-chain products. Yes. Where DeFi meets TradFi. Yes. But can you elaborate? Right. Like what?

59:15How can I be more clear, John? We're bridging legacy finance and the open economy with purpose-built on-chain products. I'm asking you to steal, man. I have no idea what. L1, L2. USD1, a US dollar stablecoin upgraded for a new era of finance. Stable, secure, and transparent by design. Lend and borrow. Supply digital assets and borrow against your holdings. Monitor risk easily with real-time health factor. and the World Liberty Fi app. And you can deposit crypto via wallet or bank account and spend by accessing your liquidity anytime. I have the steel man. The steel man on this is basically, we know competition's for losers.

59:58You don't want to be in a highly competitive market. You don't want Brian Armstrong at Coinbase and Vlad Tenev at Robinhood and all the other killers that have, you know, Anatoly at Solana. You don't want them all immediately coming out and crushing you and trying to compete with you, right? And these guys are, they're established. They exist in the space. If you do something innovative, they could potentially clone that very, very quickly, right? Yeah. So how do you keep them? How do you throw them off the trail? How do you keep them from suspecting that you're going to build something incredible?

1:00:37You launch a bunch of meme coins. You launch Trump coin, you launch Melania coin, you launch meme tokens. You do a bunch of things that makes you look sloppy. Yep. And then you come out with a really serious thing. And everyone thinks, oh, this is just another sloppy project. This is a cash grab. This is something that isn't serious. I don't need to really keep tabs on it. And then all of a sudden you're just building silently, building silently until you disrupt everyone. Yeah. I think there's something there. I mean, I think they should start acquiring companies. you know they're sitting at their they're eight they've had two billion in trading volume in the last 24 hours there's their six six billion dollar token why not start uh you know they should just hit up chamath and say let's let's uh join forces on this back and and create the greatest roll up of all time the one thing that they actually should do is get on graphite.dev it's code review for the age of AI.

1:01:34Graphite helps teams on GitHub ship higher quality software faster. They could get started for free. They could be reviewing every GitHub. They could and they should. Buko Capital says AI features are eroding SaaS margins. Ivan over at Notion says that two years ago his business had margins of around 90%. Typical of cloud-based software companies. Now around 10 percentage points of that profit go to the AI companies that underpin Notion's latest offerings. How many times have I asked a founder on the show this? I've asked this question so many times. And nobody gives a straight answer. No one gives a straight answer.

1:02:13And here it is. But this is not that bad. This is not that bad. Especially if revenue is really accelerated more than, you know, they can take a hit on margins if they're growing the base. Yeah, yeah, yeah. Well, the real question is like, does it reduce churn? Does it increase sales? Does it increase growth? Are you getting more customers? Are your customers sticking around for longer? Are they paying more? And this is just too perfect to tie in. But Notion obviously runs on Turbo Puffer. Oh, really? And they're saving millions of dollars annually, part of how they can deliver AI efficiently to all their customers because of Turbo Puffer.

1:02:53There we go. Mickey Liu over the data engineering lead at Notion says, because Turbo Puffer makes it too easy to build state-of-the-art AI apps. So absolutely fantastic. Were you ever a big Notion guy? Never a big Notion guy. Used it a little bit. I was buddies with a Notion influencer. What's his name? Oh, I know this. I know who you're... He plays like metal. Oh, what's his name? Notion brand ambassador. He has a really great YouTube-like business. He went giga long Notion. And it paid off hugely. He had a bunch of really great insights. I forget what his name is, but he's a nice guy. But I use Notion a little bit, but have mostly just been Google Docs for most of the stuff.

1:03:47I don't know. Building a second brain. Never went too far down that rabbit hole. What about you? I've paid for Notion for years and years and years. We use it heavily at Branded Native, and they still use it. I think it's a great tool. It does feel like it's more of an operating system for a team. It's really great in the business context. I mean, it's still, we're Google Maxis here. We use Google Sheets and stuff. But still, being able to create knowledge bases and sort of layered is great. So I don't understand the Notion haters out there. It's actually crazy that people can type, I hate Notion.

1:04:33Imagine hating a note taking out. That's ridiculous. No, no. I think the way the over-optimizer meme happens is that you're basically like, it's the same vibe as the credit card points maxi. It's like someone who has taken something that makes sense in a business context and applied it to their personal life. Like, oh, yes, I have a personal CRM for like reminding myself to like call Tyler and get a beer with him on the weekends. It's like that should feel just natural. And so like if someone's like, yes, like just to like. If you need a CRM to manage a relationship, it's probably not that great of a relationship.

1:05:13Yeah. And it has that same, it gives that same vibe off in the same way of like, okay, like, like if you're spending 10 hours a week optimizing credit card points, like, is that really worth it? Don't you have a higher opportunity cost? What are we doing here? I actually have a buddy who I get we shove on the show who is like the biggest points maxi and has gone so far that it's actually driving like tons and tons of value. Oh, really? He, he, he, I'll have him come on the show and, and tell the story. But he, I'm a billionaire from credit card points. I mean, didn't I tell you this? He bought a half a million dollars of gold at Costco on credit cards, points, just to get points and then sells the gold and arms.

1:05:55No way. Oh, okay. That's cool. He's the king of this stuff. He runs a whole show about it. Anyway, the, yeah, I don't know. Notion, like there are certainly people that get, you have to like get joy out of it. Like doing like, you know, in your personal life, because if it's, if it's not like work, It's definitely gatherer coded. It is a little gatherer coded. And that's okay. Some people are hunters, some people are gatherers. Organizing. Yeah, yeah. I like to hunt through my messy, messy documents. I like it as much as messy. I'm going through the file system, searching for the random.txt file where I put all my passwords.

1:06:38Like a hunter on the prairie thousands of years ago. Yes. You like stress of opening your laptop. It makes you feel like it makes you feel like you're really like, you know, I do. Or just like one gig a doc of everything. I mean, you're the worst, dude. I see you texting yourself. Yes, that is got to be like, like, that is so much like I feel like the platonic ideal is like, OK, yeah, like, you know, you use a spreadsheet when it calls for a spreadsheet. You use the right tool for the job. Like maybe, you know, you'll use a communication tool for this if you're managing a complex product. You know, like if you are actually, you know, planning and building a product, you're using Linear.

1:07:21It's a purpose-built tool for planning and building products, meet the system for modern software development, streamline issues, project, product, roadmaps. This is what you actually do. You actually use Linear for real stuff. But then at the same time, on the other end of the barbell, you're like texting yourself. Perfect transition because, you know, who's a customer of TurboPuffer. You're really on the TurboPuffer run today. I have a generational runner. This is why I talked to Simon. I was like, we're absolutely working together. Yep, yep. Anyway, should we go through this Christopher Mims article?

1:07:51Yeah, let's do that. So Mims is the reason we know about these margins. He says, with models doing more thinking, the small companies that buy AI from the giants to create apps and services are feeling the pinch. developers who buy AI by the barrel for apps that do things like make software analyze my I buy the barrel it's a great turn of phrase are discovering that their bills are higher than expected and growing what's driving up costs the latest AI models are doing more thinking especially when used for deep research AI agents and coding so while the price of a unit of AI known as a token continues to drop the number of tokens needed to accomplish many tasks is skyrocketing.

1:08:30It's the opposite of what many analysts and experts predicted even a few months ago. That has set off a new debate in the tech world about who... Wait, what about the Jevons Paradox, Maxis? Yeah, this is Jevons Paradox. I know, exactly. So while the price of a unit AI known as a token continues to drop, the number of tokens needed to accomplish many tasks is skyrocketing. So the Cheven's paradox, something gets cheaper, you just use more of it. Yes. So if the cost of AI was skyrocketing, I don't think you'd see quite the same. So the question that you're beefing with, and I beef with this too, is the characterization that it's the opposite of what many analysts and experts predicted even a few months ago.

1:09:14And there's a lot more nuance to what the experts, if you really trust the experts, it's the podcasters, what they were predicting. They were predicting drops in per token cost. That actually has happened. But then they were also predicting Jevon's Paradox that we would use a lot more of the resource. And so I don't know. It seems like that prediction was kind of true. But I do understand there was a moment where the idea was you spend 10x more on the training run and then the inference is too cheap to meter. Intelligence is too cheap to meter. And so you basically get the inference for free. You spend a billion dollars training this massive thing and then you can distill it down and inference it on your phone on the edge for free.

1:10:00And that certainly has not happened. What were you about to ask? Should we put Theo Brown, chief executive of T3 Chat, he says the arms race for who can make the smartest thing has resulted in a race for who can make the most expensive thing. I don't totally agree with this. I mean, I think it was, it's always been the case if you take a hard problem and have an LLM try to tackle it and just give it as much inference, as many tokens as you possibly can, it's going to probably deliver a better result. But I feel like now you have companies like OpenAI clearly making decisions to deliver products more efficiently, right?

1:10:42Certainly not wasting tokens is the goal of the router. The router is let's try to not get... I mean, it's also let's try and get people to use the thinking models if they're not. And they're asking questions that should benefit from thinking models, reasoning models. But also just downgrading my hammering of the O3 Pro API. when I ask a question that actually could just get one shot by the default model is probably a benefit. And so, yeah, it's more nuanced than that. I agree. It's the right tool for the job. Sizing the value of the query to the cost of the query makes a ton of sense. Anyway.

1:11:27And over the weekend, XAI released Grok Code Fast 1, which briefly topped the charts on OpenRouter and is specifically focused on cost. Do you want to keep going here? Yeah. So there's a cool graph in here about the cost of doing business, the price per token for prompts and responses for AI models at a given level of intelligence. The least intelligent model showed roughly a 9x decrease in cost per year while the most capable ones dropped in price by roughly 900x per year. So remember, AI training and AI inference are different. Training those huge models continues to demand ever more costly processing delivered by those AI supercomputers you've probably heard about.

1:12:13But getting answers out of existing models' inference should be getting cheaper fast. Sure enough, the cost of inference is going down by a factor of 10 each year, says Ben Cotier, a former AI engineer who's now a researcher at Epoch AI, not for profit. Despite the drop in cost per token, what's driving up costs for many AI applications is so-called reasoning. Many new forms of AI rerun queries to double-check their answers, fan out to the web to gather extra intel, even write their own little programs to calculate things. And AI agents will carry out lengthy series of actions based on user prompts.

1:12:46Here are approximate amounts of tokens needed for tasks at different levels based on a variety of sources. A basic chatbot Q &A, 50 to 500 tokens, a short document summary, 200 to 6 ,000 tokens. Writing complex code might be 20 ,000 to 100 ,000 tokens. And a multi-step agent workflow might be up to a million tokens. Hence the debate of new AI systems that use orders of magnitude more tokens just to answer a single request are driving much of the spike in demand for AI infrastructure who will ultimately foot the bill. This is like the Jevons paradox by NVIDIA when they sold off that you did was like so perfectly timed.

1:13:22Like it matched what actually happened so flawlessly. Remarkable. I should check on that trade. I mean, yeah. Just like there was this idea that like models, that tokens would get cheaper. And like the timeline was just like Jevons paradox, Jevons paradox. Like understand this thing. We're going to wind up using more of these tokens. This is a new capability. We're going to use more of this, even though it's getting cheaper. And lo and behold, people use a ton more. They really bought NVIDIA while we were live on the show the day that it just sold off massively. On public.com. Investing for those that take it seriously.

1:14:02They got multi-asset investing, industry-leading yields. They're trusted by millions. I am up 42%. Very nice. Not bad. Not bad. Anyway, Ivan over at Notion says that he's spending 10 % of revenue on AI now. That is high when you think about it in that frame. Because what is Notion's revenue? It's got to be in the hundreds of millions of dollars, right? And so they're probably spending tens of millions of dollars on tokens for features that they've added to Notion. And then they have to upsell or give some sort of free... Yeah, I mean, they were super quick to add a lot of AI features. I remember these are founder mode companies, right?

1:14:43Wrong one. Founder mode. No, but I just remembered it was like, okay, chat GPT was taking off. Ivan clearly looked at that and said, hey, we should just integrate this everywhere into our product so that people don't have to leave the app to access intelligence. I mean, Notion feels like such a beneficiary of AI in sort of like three different ways. One is like the most intimidating thing about Notion is when you create an account and you're just hit with like a blank page. And that's why there's people like, you know, these influencers that sell Notion templates. Because the whole idea is like, yes, when you set up the second brain and you have your Notion for your finances and your Notion for all your friends and your friends' birthdays.

1:15:31and the notion for everyone you invited to your wedding and the notion for your dog's medication schedule and you have all your different notions and they all link perfectly and all the data is perfect. Like that feels amazing. That's like the dream. But getting there is so much work. You have to spend like days and days and days like onboarding yourself basically. And if AI can do that faster, that's huge. So actually, it's actually one of the cases where I think just putting a chat box, like what do you want to do right now? instead of just being like, hey, here's a blank thing. It's a sandbox.

1:16:03Do whatever you want. That feels incredibly value additive. And then also the behind-the-scenes AI stuff seems incredibly valuable too, where if I have a CRM built out in Notion or I have a list of topics that I want to talk about on the show or something like that, having an AI that kind of can in the background go and hydrate cells in a table or hydrate or transform or summarize or kind of polish up a messier document and keep it all in like the proper Notion taxonomy, that feels hugely valuable. Totally. And so it should be a beneficiary. And then also just like if you're somebody that's actually been doing the hard work of putting a ton of data in Notion for years and years and years, and then all of a sudden now you have the ability to, you know, with just one prompt, like be able to synthesize some sort of new visualization layer on top of that, that feels really valuable too.

1:16:59So I would be pretty optimistic about them spending this much on AI, even if they're not immediately reaping the benefit, even if it is a little bit like, who knows, maybe they're getting a 50 % bump in revenue. And so 10 % hit to margin, worth it all day, take that all day. But even if they're not, I feel like this margin will come So here's if you can buy Notion for$10 a month. And then if you want AI features, you just pay more. How much? So it doesn't say here. It doesn't say how much. It's$20 ,000 a month. But I would assume it's like another$10 a month if you want AI features. And so they're having to spend 10 % of revenue on AI, but they're potentially doubling revenue on a per user basis.

1:17:47Interesting. Well, if you have a bunch of data and you want to analyze it, go to Julius. Chat with your data and get expert-level insights in seconds. Ask Julius to analyze your data. Used by Princeton, BCG, Zapier. And TVPN. And TVPN. Yeah, we actually are working on something fun. Put all of our, every post that we've ever reacted to has been cataloged. Put it in Julius. Ranked it by how many times people have been mentioned. kind of a poster power rankings, working on monthly updates here, should be our own kind of, you know, top poster list, top most mentioned of all time. Should be fun. Anyway, when Replit updated its pricing model with something it calls effort-based pricing in which more complicated requests could cost more, the world's complaint box, Reddit, filled up with posts by users declaring they were abandoning the Vibe Coding app despite protests from noisy minority of users.

1:18:46Quote, we didn't see any significant churn or slowdown in revenue after updating the pricing model, says Replit CEO Amjad Massad. The company's plan for enterprise customers can still command margins of 80 to 90%, he adds. One solution, says Christopher Mims, is dumber AI. The big companies creating cutting-edge AI models can, at least for now, afford to collectively spend more than$100 billion per year. and so yeah i i do wonder like a big thing is that if you're just hammering the front it's so easy to just hammer the frontier i think the king of the timeline situation room is buco actually i think it's yeah i mean he is i think he's literally number one we got to start at it we we should probably add our own creator payouts we should start paying out buco yeah in merch king of the timeline in merch we should send merch to the top 10 zeke says an ocean premium subscription will get you at least 2025 Tesla.

1:19:43I wouldn't be surprised if somebody starts throwing in a Tesla lease to your enterprise plan. It'd be great. Why not? So yeah, I mean, in summary, like the bulk case here is that the GPT-5 API, like eventually there will be a model router API that will dynamically route the request to the best model. And you can, instead of just saying like, okay, this particular feature is wired up to a reasoning model. It will say, okay, well, yeah, like this particular feature is wired up to a model router. And when a customer comes with a question saying, hey, I'm Notion and I want to reorganize all my data.

1:20:20And it says, yeah, that's not really a notion. That's not really a reasoning level task. Let's put that on a cheaper model, dynamically route it, save a bunch of money. Anyway, if you want to get your brand mentioned in chat GPT, go to Profound, reach millions of customers who are using AI to discover new products and brands and get a demo at Profound. Anyway, should we talk about the podcast Gold Rush or should we run through some timeline? What are you thinking? The podcast Gold Rush, media companies race to license star creators with AI upending how people consume information. News outlets are willing to pay top dollar for unique voices.

1:20:55Traditional media companies are in a deal-making frenzy with podcasters, social media influencers, and other content creators. Fox News in July announced a new media expansion, including a licensing agreement with the Ruthless podcast, Free Willing Talk Show, featuring several former Republican political strategists. In August, The Athletic agreed to a seven-figure deal to license Pablo Torre Finds Out, a sports and culture show. Vox Media recently announced a partnership with Bella Freud for her fashion neurosis podcast and has agreed to a licensing deal with David Axelrod, Mike Murphy and John Heilman's show Hacks on Tap.

1:21:34Established media companies watched in Oz, independent podcasters drew star guests and drove the news cycle during the 2024 presidential election. And with artificial intelligence tools changing the way people consume information and audiences hungry for authenticity, outlets from Fox and the New York Times are eager to create content that can't easily be replicated by a chatbot. For many, that means building out rosters of distinctive human voices. The world will be poorer if we were just served, quote, by an AI agent with content that has originated from algorithms, says Paul Cheesebro, chief executive of Fox Corps' Tubi Media Group.

1:22:10The role of the creator becomes even more important in that world. Fox and the journal's parent News Corp share common ownership. Sean Ryan, Ryan, a former U.S. Navy SEAL and CIA contractor, started shopping the Sean Ryan Show earlier this year. Recent episodes, which can last upward of three hours, featured a deep dive, featured a deep sea mining executive, a former military contractor held hostage in Columbia. And like seven of our boys. Seven of our boys and California Governor Gavin Newsom. Ryan Bills, the show is. Newsom did Sean Ryan? Oh, I didn't realize that. I missed that. Ryan Bills, the show, is focusing on...

1:22:49Like holding a gun or something. That was like the viral moment. Yeah. Focusing on what the media isn't talking about. Yeah, I mean, I think they might get into this in a bit, but the takeaway here is people are less interested in paying just for news because you might open X and see some Anon account posting a headline as someone else did the fact finding they're just like posting a easily digestible screenshot and more interested in sort of commentary and analysis surrounding news I guess I guess my question is like if the end state of these podcasts is partnership with legacy media networks what does that say about the talent identification and like talent nurturing for the networks like why can't why can't fox go and find the next ruthless and set them up put it together yeah exactly like uh or is it maybe more more efficient to actually have the the the nfl combine of like the next sports yeah you guys have a you know a competitive bloodbath exactly and we'll pick out the winners.

1:24:10Yeah, maybe that is actually. I mean, you see this in music now where a lot of record labels wait until somebody shows incredible talent and then they'll sign them after they've gotten a billion views on TikTok or have a hit song. So I still think, yeah, the question here is does signing, you know, if Sean Ryan goes to Fox or Tubi or one of these other platforms, is that enough to sustain these legacy media companies or do they still get competed away over time? Yeah, the question is like what does the long-term business look like? Because they're all pivoting to like, or they're all expanding to over the top or instead of over the air, like the, I think it's OTT, like the streaming services.

1:25:02So like they all want to have their own streaming networks, but then they're in direct competition with Netflix. and that's going to be really hard and they're in competition with Apple and Amazon and YouTube and that's really really hard and then and so the questions like in the short term it makes sense like I could imagine paying Sean Ryan to license his show and running ads against it on Fox being higher value than than just like the next random show that probably costs a bunch to make and brings in the same amount of ad revenue, like if they're just paying Sean Ryan to do his show and then they're just airing it, that could be like a good financial decision, right?

1:25:46The question is like, does that actually get like a younger Sean Ryan viewer on board on Fox? Well, yeah, the question is like, if legacy media, you know, if cable is being competed away by different streaming, cable revenues are being competed away by streaming platforms and social media platforms, how many Sean Ryans do you need to replace the lost revenue and the fullness of time that comes from cable just going away? You need a lot of Sean Ryans. There are a lot of Sean Ryans out there though. You could carry a lot of these shows and you could, you could definitely fill out a 24 seven news cycle.

1:26:22You could fill a full channel with independent content creators that are licensed. But the question is like, is like how, how, how much does that actually make people stick around versus they just stay in their apps and they just don't really go back to the networks or like what value at that point is the is the network actually delivering totally anyway let me tell you about numeral sales tax and autopilot spend less than five minutes per month on sales tax compliance

1:26:53let's rip some timelines do some timeline so Elon Musk is back to posting about romantic companions i believe uh major upgrade of brock imagine in a few weeks um definitely needs an upgrade people were not very happy with the quality of the video although there were lots of people that were promoting it and sharing it because it was certainly edgy um but in terms of like the the video up that video of sam altman yeah that's the next one by Taoki. If we can pull up that. Try not to share your screen. The Sam Altman clip from, this is from Cleo Abrams' show, I believe. In the timeline. In the meantime, let me tell you about fin.ai, the number one AI agent for customer service, number one in performance benchmarks, number one in competitive bake-offs, number one ranking on G2.

1:27:51Do not get in a bake-off with Finn. That's all I'll say. And can we pull up the Sam Altman clip from Taoki Taoki? I don't know how to say that. A repost from Hungry Donkey of Sam talking to Cleo Abram on her show. It's in the timeline. Meanwhile, Arfer Rock is highlighting Statsig was acquired by OpenAI in a$1.1 billion all-stock deal. Notably, they announced$100 million Series A at the same$1.1 billion valuation from Iconic a few months ago. I wonder what prompted management to sell after the recent large fundraise. This is what I was saying earlier, that the acquisition is just at the last round price.

1:28:37But it's very possible that the Statsig team and the board think that there's just more upside in owning a piece of OpenAI than owning a piece of Statsig. So even though it's happening at the last round price, the last investors aren't getting a premium. They are they're riding with OpenAI now. That makes sense. We got the video ready. Let's pull it up. No audio. Best for the world, but not best for winning. Can you start over? What is an example of a decision that you've had to make that is best for the world, but not best for winning? Well, we haven't put a sex bot avatar in Cheshpt yet. That does seem like it would get time spent.

1:29:26Apparently it does. Is that graphic added on her show or after the fact? I would assume she didn't add that. Somebody added that. Yeah, I don't know. The other thing about this deal is Iconic is the lead investor in Anthropics New Round. So this is a way for Iconic to get some open AI exposure. Interesting. Did you want to talk about Align Ventures? They're on a generational run now in early stage CPG investing. The fund started in 2018. Yeah, we covered this Friday. $20 million fund was invested in some of the biggest - Because they're in Mammoth Brands, which has acquired Coterie. Coterie, sale to Mammoth Brands.

1:30:08Figs. Oh, they were in the Figs Series A, which IPO'd in 2021. How is Figs doing now? I know that they IPO'd and they were kind of ripping. they were in hymns and still a billion dollar company wow uh touchland seed acquired by church and dwight company i don't know touchland uh for 880 million billy seed acquired by edgewell bigs also ipo'd at uh what 34 dollars a share it's at six dollars a share now okay so it's down they would have done i mean a line would have done really well yeah on the ipo the total ev of their investments is likely north of$15 billion. Wow. That's crazy. So that's how they have the capital to be ripping into a figure.

1:30:53Robotics. Yeah, that was uncharacteristic. It seems like they really know there's some stuff. Humanoids could be some of the biggest consumer play of all time if you get a robot in every person's home. But obviously a competitive market. We've got to talk about this Ethan Ding post. uh google trends data on interest in lovable replet clog code cursor windsurf all down cursors down 60 percent uh peaked august 3rd uh clog codes down uh 56 percent lovable's down 44 percent replets down 68 percent windsurf's down 78 percent this doesn't make any sense to me like i'm even looking at the charts and it doesn't look like it's weighed maybe down from peak, but that's just Google trends.

1:31:43It doesn't mean revenue's down. What do you think, Tyler? Has anything happened in cursor, cloud code, lovable, replet, web server? I mean, Ethan responds and he says, might be nothing. Market's maturing. Users not switching as much, right? If they're actually settling into using products, then they're not frantically looking. Or it could be that just overall growth is slowing. Also, it's just like a, it's a slight sell-off before lock-in season. Or people are just using the models to do search now themselves. Oh, yeah. So people, maybe this is just overall search. No, I think all of this is relative.

1:32:23Oh, right, right. Tyler, what do you think? I think it could be like, yeah, it's like the lock-in. By now, the kind of exploration phase is over. People are like, no, okay, I like using Cloud Code. I like using Lovable. They've tried everything, and now they're kind of maybe just using one now. Maybe. Something like that. Yeah, I mean, I guess the date is down during August. That has to be like the slowest time for basically everything. This is like big vacation season. I don't know. I don't read too much into this. I still feel like a lot of these are big markets where many of the companies will do well.

1:32:56Also, there's some sort of compounding thing. Also, like Cloud Code, I wonder if that's even the term. like if I go to Google Trends like are people just searching for anthropic like is anthropic off the peak anthropic is a search term anthropic is a search term over the past let's see seems like every every every search everything I've searched so far has peaked around the beginning of August yeah yeah anthropic broadly is down what about what's something that should not be down at all like Erewhon. Is Erewhon down? Erewhon is flat. Erewhon is not. Labubu peaked in July as well. What about OpenAI?

1:33:44Let's see. OpenAI also saw some crazy spike in August. What was going on July 27th to August 2nd? Everyone was talking about AI or something, and then it just like completely dropped. Something weird happened with the Google data on August 2nd or August 1st or something. What was going on then? I don't know. Anyway. Anyways, I don't think we should read too much into this. It's interesting data, though. I agree. Let me tell you about Adio. Customer relationship magic. Adio is the AI native CRM that builds, scales, and grows your company to the next level. Get started for free. This was funny. Mr.

1:34:22Beast was streaming about his water charity. Yes. And he just kept refreshing Polymarket. it that's so funny because he can see the actual data of how things are coming in but he just preferred to look at polymarche i mean it's a fun chart to look at when it's going up from from you know up to up to 90 percent that's amazing 99 wait let's see what it was like uh a week ago the odds that we were gonna hit it was 50 so ken griffin came in this is this is america it's like we can bet on charity in this country a lot of people who bet that we weren't going to hit it are uh doc ddossing the site so we don't hit it what were the lowest odds at the beginning what was it oh that's a crazy dynamic it looks like it hit a low of 50 a week ago at the very start it was hovering around 30 um wow yeah it's kind of crazy i'm i'm tearing up realizing that we can bet on charitable giving now there's six and a half million dollars of betting volume on this man why are so many people betting on this he's like can you please just donate to the charity?

1:35:25Yeah, instead of gambling on it. Oh, that's hilarious. Shout out to Ayush from Warp. He married the love of his life in a 500-year-old cathedral in a 2 ,700-year-old town in Spain this weekend. Absolutely fantastic. Love to see it. Love to see a young technology brother marry the love of their life. Now, Ayush, please get back to building sass. What's this?

1:35:56This is, here comes the bride. Is this trade? Is this? I don't think so. I think this is like. Fair use? I think it's fair use. We'll see. Maybe we'll get struck. Let's keep talking. We need a wedding sound on the soundboard. Anyway, congrats to him. It's a fantastic photo. Wow. So Palantir is launching a new campaign. Saying you're being sold an AI future where you're obsolete or irrelevant. We see it differently. Doomers say AI will take your job and then your life. Pacifiers say not to worry. Machines will handle reality as you handle the remote. They're all wrong. Americans are already wielding AI to work wonders.

1:36:34From factories to hospitals, they're ditching spreadsheets to solve real problems, make real things and kickstart the prosperous era, the most prosperous era in our history. Today we're launching Working Intelligence, the AI Optimism Project to show you how. This is great. the doomers will hate to see Palantir providing an optimistic future for AI in our lives should we pull up this should we pull up this clip of Gavin Newsom we certainly can we also have our next guest there we go well why don't we dive into our first guest of the show and we'll come back to that Andrea from Snackshot who was of course profiled Friday in the Times great to see you hi how's it going it's good how are you great congratulations on all the progress thank you it's been five years in the making five years what was the what was the inspiration what was like the first post do you remember yeah it was about the rise of this new wave of non-alcoholic drinks and look at it now is now the time to go long alcohol yeah Yeah.

1:37:47Because I've been seeing people, you know, fading the like non-alc trend being like, all right, everybody's laying off the elk. I'm going to go on heavy. Yeah. I think so. Yeah. I, I like Gen Z is into like buzz balls and like people are bringing back hypnotic. So a hundred percent. We got to get some buzz. We got to get some, unfortunately some members of our team are not 21. So we will not be bringing back buzz balls in this office, but I think, do you know about, was that, was that around when you were? Yes, yes, I'm familiar with Buzzballs. I don't think I've ever actually had one. I've seen them at the grocery store, though.

1:38:21What were the biggest winners out of the non-alcoholic trend? Was it Athletic Brewing back then, or were there other companies? Yeah, I think the only one that I can say, okay, it makes sense, is NA beer because it really does taste like the real thing. And then you have all these NA drinks that I'm just like, dude's fucking just like a sugar drink and yeah that's what i never i i never invested in the the non-out category despite getting a bunch of pitches because i was like i can just have a diet coke i could just have like a soda yep i guess i get you know energy drink there's just a lot of investing in like protein heart i mean there is already a protein heart seltzer brand we have nicotine energy drinks now okay but we saw that we i don't think that's yeah i don't is it actually real it seems extremely i literally like i interviewed the founders when i wrote about they're doing it wow okay it's they they hired one of the guys from coco vita okay no that's that's like but do they know do they know it's it's illegal so they're operating Okay, so I asked them about this and they're operating under the Kratom category.

1:39:36Oh. I'm telling you guys, like these guys. So we're operating in a gray market, a drug gray market. Yeah, they're operating in the like smoke shop gray market area. But these guys are like from the Redneck Riviera, like Destin, Florida, like the kind of person that would be behind this brand. And they don't give a fuck. They're like, they literally told me we're building this for the LA people, the lower Alabama people. so lower Alabama they know their targets are good so yeah that's the ball what about protein are we short protein you can get protein and everything now you apparently I I and I've been reading studies about this I think in the next 10 years there's going to be people with like severe kidney like uh problems too much protein yeah your body cannot process the insane amount of protein that american people are putting into their bodies now and so i joke when people are trying to push you like i you know i saw protein croutons the other day and i was like this is ridiculous but i'd love to see people's blood work like no no uh no i won't add protein uh i don't want to add like a meat or fish to my to my grain bowl i'll just take protein croutons please well there's also now a brand that's doing protein greens and it's like a solid green it's but don't don't greens have some certain oh that's funny i have no idea but we're beyond parody at this point starbucks announced they're doing a protein foam matcha latte foam sorry this month yeah like cold foam you know those drinks that have like the cold foam so like starbucks is long protein so i think we should be shorting it that.

1:41:24Now that you're having that, I feel like we're like, okay, we can start backing out a little bit about that. But it's been interesting. Beyond protein, now there's a whole creatine snack trend. And I came across creatine, man cereal is this creatine cereal that's launching, but then you also have things like creatine muffins, creatine croissants. And it's just, that's what the thing about what i love to pastry is that that that i don't the science behind it is that carbs help our bodies absorb creatine better and faster so that's the science behind it but yeah that's kind of what i love doing what i love doing it's like i come across like the most insane unhinged products but it also is a testament of like the american consumer is like optimist like you will you can sell anything to americans okay speaking of selling everything the chat wants to know about psilocybin ice cream i don't know if that's real or if that's just a joke i mean i've definitely seen uh like psilocybin obviously like the chocolates yeah um there's some places in la that i do them the the teas i've actually had some of those teas they operate on the down low so it's like mushroom tea yeah it's and it has like it'll deal yeah but It'll be like micro doughs.

1:42:45So it'll be like a little small bottle of them. The company is called Toasty Town. I'm obsessed with it. I actually smuggled some. Okay. Okay. You're live. You're live. Okay. I'm live. But anyways, great tasting. So I'm not surprised. You smuggled it from the plate into your mouth. My mouth. Anyways. But yeah, I'm not surprised if people are doing that on a DL. I don't believe that ice cream would be the best way to ingest it. I don't know. I would have to. Have you seen anybody try to put cocaine back into cola yet? No, but I think at this point I wouldn't be surprised if Coke just says like, fuck it.

1:43:27You know, like we wrote about this, like, like push into like the cocaine induced opulence of the eighties. And that's why we're people, you know, want to do 300 milligrams of caffeine in one drink. We have the killer Panera lemonades. Starbucks is also doing energy drinks. So I don't know. I feel like America wants to and it yearns to be stimulated. And we're like kind of the reverse of the ayahuasca psilocybin kind of like brain dead vibes. Do you think we're seeing more new CPG companies formed than ever? because over the last few years, there's been less early stage investment activity or at least from the institutional side.

1:44:11But it seems like there's still like a fire hose of new brands. Yeah, because a lot of the barriers of entry of these categories are so low. And it's really funny because people can just Kickstarter it. Like Fly by Jing, which is doing really well. It's like a Chili Crisp brand and they started off with a Kickstarter. You don't really necessarily need venture money to launch a brand, a CPG brand. But obviously, I think it's VC came in to corrupt the CPG industry and trying to grow it in five years and trying to get those exits, something like a poppy or a siete, that have been able to do it in less than a decade.

1:44:49But that's obviously not necessarily the norm for the industry itself. But yeah, there's... Yeah, I mean, it's certainly true. I mean, I'll defend venture capital with my life, but I would take a bullet for venture capital. But certainly a lot of brands that I love were started decades ago and didn't raise anything close to what venture capital looks like today. I wish there was a way to short new CPG brands. Like someone needs to do a polymarket for that. Brutal, brutal. You're supposed to be there. But isn't the competition good? We just, like, you know, we throw a bunch of entrepreneurs. We see what sticks, and every once in a while you get a great product that sticks around forever.

1:45:38I know, but, like, I mean, I've come across Palo Santo brewed water. And, like, people are trying to, like, sell. It's just like wood. It's like a certain type of wood. Really? The description of the product is, like, you know, Palo Santo is what you burn to, like, sage yourself. And so the product describes itself as like something that can like elevate your vibe. There's people who say like, oh, you can have like spiritual enhancement through like these fucking$7 adaptogenic seltzers. And so at this point, I do think that we need to be more like strict in what we allow to put out there. Because like none of that actually changes that there's Skittles water in the market, you know?

1:46:19Wait, is there actually Skittles water? no there's actual skittles i bet that raises your vibe crazy yeah that seems pretty good how uh do you do you still some something i like personally i think uh the invest if you're gonna invest in uh cpg it the only criteria that really matters is the product truly amazing how much how often are you surprised where you try a product and you're not impressed by it, but then it goes on to be successful? Oh God. Uh, yeah. And I've, I've spoken my mind about how I don't believe that people are buying$12 protein cereal, um, or, you know, I'm not going to say the name of the brand, but I, there's a lot of things that I don't believe that make any sense to me.

1:47:11And I do believe that it's like VC and it's distorted and it doesn't make sense and I'm someone who does spend a lot of time in groceries really observing from a more anthropological POV like what are people really wanting to spend like a lot more on or you know how groceries became this like way of status signaling that you didn't have before like our parents were like showing pictures of Heinz to their friends and being like, oh my God, I have, you know, this in my pantry. And now you have people about the grass in their kitchen. And even like the idea of what I call like a hype beast grocer, like an Erewhon or a happier grocery where it's like that.

1:47:55It's so crazy that that actually exists. And then our generation, this form of affordable affluence where it's like oh yeah i'm gonna go spend 30 on a 80 gram sugar smoothie for clout um and i i think that i saw the news about uh you know emily flundberg posted about that like everyone being inside of like a kith that members club and so it's really funny because i think that's gonna be like the clout chasing final boss like you dropped six thousand dollars on a membership to buy a$30 smoothie in New York, like you gotta love it. I can't hate it. I mean, badge value is real. People want to be seen with something.

1:48:35It's an accessory. There is something to that. I mean, it might be bizarre and distorted, but it's real and monetizable. And so it will, it will. I like putting, they should put all air ones inside members clubs because I don't like my only critique of everyone. I mean, my only critique is like the crowds. I hate going in you can tell on like on a, on a summer, on a summer Saturday that it's like tourists. I don't want to see tourists in my grocery store. Who, uh, who, who do you, who do you write for? Like, who do you think you're, do you think your audience, uh, you know, do you write with the mind of the consumer in mind?

1:49:13Do you, do you snacking generation or is it more like the industry participant, the investor, the business owner? I come from PR and marketing. So like my POV was always like I can kind of dissect this for you and tell you what of this product is mostly BS and a crafted narrative and so I started this publication based on the idea of no one's writing in this like cpg circle jerk of an industry like everybody's just writing for the buyer or for the retailer or whatever or for the other investors but no one was really talking to like your average person who eventually finds us at a target and doesn't understand like how come we have like protein popcorn at target where did that even come from so yeah i write it's funny because like have you thought about putting protein like bundling it into the subscription your subscription like uh subscription um well my audience is very young which is really funny like i've even been invited to give guest lectures at colleges which is interesting and my number one advice is like, don't do it.

1:50:17Don't get into CPG. Um, but it's, it's interesting. Like I, you know, a lot of fun. It's, it's, it's people love it. It's fun to make things that you can consume and, and physically, you know, it's a very common story. Somebody is in finance, they're just in Excel all day long. And then they start a beverage company. Yeah. It's much less abstract. Like you are making widgets. It's a widgets business. Like you manufacture something, you distribute it, you see it. And like people think it's easy because they're like, okay, I just make a drink and I sell it a lot of times and then I exit for a bill.

1:50:48And the first time you see one of your products like in the trash out in the real world and you're like, wow, like this is a real thing. It's amazing. Yeah. It's amazing. Yeah. So I try to like write, I started writing for myself as an audience, but I guess like, you know, there's so many people that can take what it is. So like I, you know, there's, I have a popular Instagram account as well. It's not just a newsletter and I do a lot of memes there that have gone really viral funny because like oh they're like celebrities like like bj novak and uh kira i forget what her last name is but uh and like all these random people that i'm like wait how did you even find out about this people love snacks yeah it's a universal language universal experience so yeah i guess that is a very universal subject but the way that i write it just makes it a lot more relatable and digestible to your average person are you long or short uh celebrity brands oh super short like i'm saying like we someone needs to make poly market for cbg maybe maybe i'll do it what are you long are you long like legacy brands then long the american consumer a hundred percent that um but i what i'm fascinated with right now that i I wrote a deep dive on this like three years ago, the inner, like the influence of wearables on what we decide to eat and drink.

1:52:11So I'm very invested in, not personally, because I don't invest, but I like, I'm very fascinated with how, you know, there's the trend of people not drinking at a certain age because they're wearing the whoop, they're wearing the aura, this whole, like, uh, uh, the new hot biometrics which is like quarters people wanting to know what their cortisol looks like i i just talked to a company that um has uh cortisol strips that you put in your mouth and you they immediately like uh populate the information into your cell phone i think that's crazy i love the idea of technology advancing enough that you can potentially have one one day a non-invasive glucose monitor that can tell you like oh uh you know you shouldn't be doing like drinking this or whatever how it affects you but there's brands now the guy from oatly he launched a brand called good idea and they developed this ingredient that counteracts your sugar spike if you drink it with meals so i think that's really cool it's important because oatly massively spikes here yeah he's trying to like undo his like what he's doing but i think that's fascinating i'm like explaining to you don't have to be Brian Johnson.

1:53:19Explaining to people that your body processes your oat latte just like it's a Coca-Cola is mind-blowing for people. Yeah, but you don't have to be Brian Johnson at this point to be able to understand your body in that sense. But anyway. Awesome. Well, congrats on the recognition and the profile. It's so nice to be here. I know. Thank you for all the support since day one. It's a great hangout. And it's great watching you win. We'll talk to you soon. Cheers. Have a good one. Bye. Get that mallet ready, Jordy. We have some news coming into the TVP and Ultradome from the Restream Waiting Room. We have Rain.

1:54:04Welcome to the stream. How are you guys doing? Welcome. Give us the update. Introduce yourselves. Tell us what you do. Tell us the news. Give us a big number, please. Hey, we're co-founders of Rain. I'm Farouk. and we're building stable coin infrastructure we just raised a 58 million dollar series b let's go

1:54:27first proper hit of the day uh what was it 52 58 how much money 58 58 58 and and and and that 58 million it's still worth 58 million right because you're keeping the stable coins exactly did you already rip it into world liberty financial hopefully not hopefully not um uh yeah yeah uh just uh i'd love to just better better understand the business uh kind of go a little bit below the surface what are you guys uh doing uh what kind of customers are you working with all that good stuff yeah we power a lot of like global payments use cases powered by stable coins largely on top of the Visa network.

1:55:07We are a stablecoin-based card issuing platform as well as a stablecoin-based payments institution. So we connect any use case with any sort of payout mechanism around the world. Anybody can embed stablecoins into their app and just rip it. You can give US dollars to everybody around the world. Let's give it up for just ripping it. Some of our customers include Nuve, the large payment process, payment acquire, Avalanche, we power the Avalanche card, we power a lot of dollar access cards in Latin America and emerging markets. Got it. Yeah, I was going to ask, so like is a lot of the business international at this point?

1:55:46Only about like 50 % of the business is international. We power a lot of US use cases where consumers are dealing with stable coins, but it feels and looks like a regular credit card or debit card product. And so it's not just global, it's everything. What we are thinking is, let's just upgrade the infrastructure in the back and then the consumers and the users can feel whatever they want to feel with whatever they already have. Yeah. What are the tangible benefits for the American consumer who might be using just normal Visa network card? Does if you're if you're using a stable coin as the backing, is that going around the Visa network entirely?

1:56:23Are you still plugging into the Visa network at some point? We're still plugging into the Visa network, but I'll give you an example. Like Rain is the only company that settles seven days a week with the payment hour using stablecoins. That lets us have significant savings in terms of collateral that our customers need to post. Got it. So the end user advantage is not necessarily to the end cardholder. It's our partner that's operating a program. So you can launch faster. You can service more people. You can be more flexible. You can operate more cheaply. You can make more money. And so for us, it's really about driving costs down, driving revenue up for our customers and using stable coins to do that.

1:57:04That typical credit card has to have like four days of collateral for a long weekend risk. And we're able to bring that down to less than a day of collateral. Yeah. So is the long term that you might see someone try and compete with like those popular credit cards like the Chase Sapphire Reserve or Amex Platinum or something? and they're able to pass through more savings because they're saving more, so they acquire more customers that way, and there's this flywheel there? Is that how we might see something like this actually go really big in America? You can already see things like this happening in the U.S.

1:57:38We have a number of customers that are paying like 3 % cash back, and they're competing head-to-head with some of these programs. And for us, it's really about being the partner that you can scale with at a significant cost savings. And so our customers are able to just move a lot quicker. Yeah, if you look at the Etherify card between power, they have really competitive rewards that they offer. Nice. You guys start, correct me if I'm wrong, but you guys started in like 2021. Is that right? Yeah, we were actually, so we initially built this product called SinoWire, which was a little bit competitive with PartyRound.

1:58:13Yeah, yeah, yeah, yeah. That's what I was getting at. Because I'm looking at the website. Obviously, you guys have evolved a ton, but I remember those days. Yeah. And we had stablecoin functionality in our product, but we just after the what I was going to ask you about is like navigating kind of the FTX kind of crisis, because at that point we had to basically completely jettison or remove a lot of the stablecoin functionality that we had. Because at that point, every major financial institution was just saying like, look, risk off, exactly. Yeah, I mean, we were lucky to find a way through that without having to, you know, cut down on all the stablecoin stuff.

1:58:55And it was actually a blessing for us because we were able to build in relative obscurity all the technology that we now take for granted and be able to use that with volume in multiple years of history that now like large enterprises come to us and they're like, wow, you've been doing this for several years. And you know, anybody starting today is going to have to start today. Whereas with us, we've started several years ago and you get a battle tested solution, which has been our advantage in the market. Yep. What do you guys, obviously, we have new stablecoin regulations. What are you guys expecting from the market broadly over the next, call it six to 12 months?

1:59:34It looks like it's a lot of people are going to explore what stablecoins mean for their business and for their bank or for their app. And I think that that's all very good. Right. Our hot take is that it's probably going to look like when people started issuing gift cards that you can buy at CVS where I can get a red lobster gift card and all these other things. But if you can't use it anywhere else, is it really money? I think that's what people are going to run into. A lot of folks come to us when they launch a stablecoin and they're like, oh wait, I can't use this anywhere? Like, what if there was a partner that lets me and my customers use this in more places?

2:00:17And so that's where we come in. We just started part. We just partnered with the state of Wyoming, where on the first day of launching their frontier token, it was accessible and usable on the RAIN infrastructure anywhere that Visa's accepted globally. So just from Wyoming, we were able to take it to the world without them having to do anything. That's wild. Is every state going to launch a token, or do you think they're an anomaly? Some states will probably launch tokens. I think other states are still probably figuring out why they're anti all this stuff. Yeah. What is the rationale for for an individual state not launching a token that's tied to the economic prosperity of that specific state, but just backed by USD?

2:01:08Like that seems extremely redundant. And and I could not wrap my mind around the benefit of that. I mean, a lot of these states, like in Wyoming, for example, they see this as an opportunity to build a state-backed token where a consumer around the world knows that, hey, this is supported by a government institution. It's going to be one-to-one. They're not having to take the risk on a private market issuer that could have a run on the bank. And so there's a potential market for there to be, hey, you know, this is a public sector token. it's more trustworthy because it's issued by a regulated by by actual so is that just like a run around the no central bank digital currencies like vibe that we're getting out of dc i think that there are going to be a lot of different types of experiments on how do we get around like no central bank digital currency thing like ultimately if you look at the dollar if you go back far back enough most of them are just issued by public like private banks right dollar dollars were issued by like their local community bank and then eventually they were issued by the federal government and we're probably going to have several countries where it's going to be issued by your local private bank and or your state and other places where it's going to be issued by the central bank and maybe other places where it's going to be just issued by your corner store or walmart or amazon and i mean it's going to be interesting to see what the next few years looks like because we're going to see this like cambering explosion of whatever people want to do and that creates an opportunity for you guys to just be in the back end swapping in and out of all these random stable coins that each represent a dollar but have varying levels of liquidity and yeah is that is that right i mean you don't know like if you have cash in your pocket i mean i don't but you may but most of the bills in your pocket are issued by or you know they have a different federal reserve on them like do you know do you care sure like is it denver federal reserve is it the kansas city one like which one is it um so we really built our infrastructure to be agnostic of whatever stable point is people want to use you know people want to spend them we have direct relationship with these issuers and we're just providing that utility layer for them yeah that makes sense uh last question uh aaron frank told me to ask you You've already given some hot takes, but he said to ask for some hat takes.

2:03:34He said you're very opinionated on hats, Farouk. Anything there, or is he just messing with me? No, look, I'm a big, deep hat guy, so I think your hat looks very nice because it looks like a nice deep hat. Charles is more of a dad hat guy. Never dad hat. Never dad hat. I didn't know the terminology for it, but dad hats are over. This here addresses any brain heads. We'll do it. We'll do it. Awesome, guys. Well, congratulations. You started the company at the right time, and it's awesome to see the progress. Cool. We'll talk to you soon. Thank you so much. Congrats on the round. Cheers. We'll talk to you soon.

2:04:18How'd you sleep on tonight, Jordan? We talked to so many incredible entrepreneurs building so many incredible things, and yet we still need to solve the internet crisis. There's a global internet crisis. I had 84 last night, but I think this doesn't count some of the bonus sleep I got. What did you get? I got a, so this is crazy. Went to bed at 8.32. 8.32? Woke up at 5.30. Okay. But only got six hours of sleep. Because a three-year-old was going, the whole house was going crazy. I walked, I got up this morning and my. What was the final score? 62. Oh, play the sound effect for me. let's go I woke up this morning 1-0 this week let's see it's a short week I get up I get up at 5.30 walk out of my room three year old walks out of his room holding a sandwich that's hilarious where does he at some point got up in the night and just grabbed a sandwich from the fridge there is a certain moment where the kids they like stop being like babies and they start just being like roommates And you're like, oh, you're just like eating food out of the fridge, bro.

2:05:30Did you ask? Did you ask if you could eat my sandwich? It was his sandwich. It's his credit. We got a takeout yesterday. But still, I was like, dude, it's 5 a.m. Why are you eating leftovers? Possession is 9 tenths of the law, Jordan. Yeah, it is. Anyway, 8sleep.com, get a pod 5, 5-year warranty. Code TBPN. 30-night risk-free trial, free returns, free shipping. So apparently the judge issued a sealed decision in the Google case trying to figure out what any more details. Oh, yes, we finally got the Google results, but we don't know exactly what it is. I don't know. In other news, Benny Safdie collapses into tears during the 15-minute standing ovation for the smashing machine.

2:06:19Do people realize if The Rock wins the Oscar, he's going to run for president? 41 ,000 likes. I think people want The Rock to run. That would be great. What do you think? Do you think The Rock could pull it off? Did you see his new slimmed down look? He lost some weight. He's not very good. I mean, do you think he's just getting ready for the mass gain run? Yeah, I mean, bulking season is coming, clearly. Yeah, I mean, it's hard because he's so bulked. He is getting older. it seems like it's probably a more healthy decision to take off some of the weight and not walk it around. But I'm excited.

2:06:54I know you won't be seeing this movie because you never see any movies, but I will be checking out the smashing machine. It looks pretty good. Anyways, can't figure out what's happening with Google yet, but the stock is up in after hours trading. So I guess I like it. This is a good one. So there's an interview with the CEO of Chevron in the New York Times. And there's a quote here. So what are you trying to learn about right now? Asks the interviewer. And the CEO of Chevron says, artificial intelligence. So what's the last thing you asked AI? My last question was about, was the biggest, was about what was the biggest merger in the United States last year?

2:07:36And they say, what was it? Our acquisition of Hess. This is the power. of AI. This is the power of artificial intelligence. Priceless. Just going to AI. You're the CEO. Just asking about your own activities. Yeah. I don't know. Was he expecting a surprise there? That is such a funny result. Anyway, we have Mike Maples from Floodgate Capital in the Restream Waiting Room. We will bring him into the TV panel. Mike, how you doing? What's going on? Welcome to the show. How are you guys doing? We're doing great. Thanks so much for hopping on. I don't know if you read that article, that interview with the Chevron CEO.

2:08:15Did that surprise you? No, I haven't. You know, I got to say that it's a little bit out of my lane. I'm way too early in startups. And so Chevron is not top of your radar. Yeah, Jordy. Well, yeah, I still think it's fun to use AI to research yourself. The Chevron CEO is researching his own business activities to validate, I think. But I'm sure it's fun to look up some of your best investments in ChatGPT. But it's great to have you on the show. Yeah, thanks for having me. I've been fans of what you guys have been doing, even when it started as the Tech Bro podcast. Yeah. A long time ago, nine months ago.

2:08:56That's right. Yeah, I think we might have replied to one of your posts. We had some fun with that. It was a good time. Anyway, how would you introduce yourself to the audience? What's the right way to think about your position in the ecosystem right now? Yeah, I'd say that I'm kind of one of the OG seed investors. And so, you know, seed investing wasn't really a thing 20 years ago. You know, you either scared up a few dollars from angels and friends, or you went straight to raising 5 million. And so guys like myself and Josh Koppelman started to create these seed firms. And things have obviously changed a lot.

2:09:38Now nobody questions whether they're seed investing. Now there's like 2000. You know, if you go to LinkedIn and type seed investor, I think you get more of those than there are founders now. So it's changed a lot. Yeah. What's been the what's been your strategy for dealing with the change in the market structure? I mean, some firms have been like, I need a massive growth fund so I can ride my winners all the way up. I need to, you know, really like incubate stuff and like get huge ownership stake at the early stage with less capital. What's been most enticing to you? Yeah, you know, what I started to realize was I always say to founders, you have to avoid the comparison trap at all costs.

2:10:20And that, you know, startups role in the world is not to be better, but to change the subject. So I realized about 10 years ago that I was a hypocrite giving that advice because here I was one of 2000 seed funds. And so I was like, you know, I'm playing the comparison game all the time. And so what I started to do is to try to say that I don't want to be pitched anymore, that I want to find founders before they figured their ideas out and get to know them and come up with ways to help them evaluate whether they really want to pursue the idea or not. And so, you know, there's that famous essay that Paul Graham wrote and Brian Chesky talked about founder mode.

2:11:03I like to find people who are in builder mode. Sorry, a little sound effect for you. Yeah, we'll have a complimentary one for builder mode, I suppose, but I like that who are, you know, pursuing something almost to an unreasonable degree. They're down some rabbit hole. They're not sure it's a business yet, but they're doing it because it's interesting for its own sake. They're, you know, people are living in the, so that's really what I try to do is find the, what the prime movers to be. And, and this may, this may appeal somewhat to your all sensibilities, particularly, you know, some of the founders fund adjacent stuff, right?

2:11:40But you're kind of, you know, I just think that some people just have this very rare blend of determination and original thinking. And those people to me are the prime movers. And my job is to find those people before the rest of the world believes. Do you have particularly favorite lakes to fish in? You know, there's the folks that are, you know, at Stanford and Waterloo constantly, you know, the Teal Fellowship is pulling from pulling kids out of college. YC pulls a lot of new grads, casts a really wide funnel. Chris Dixon was famous for kind of hanging out on Reddit and finding like these little pockets and communities where, oh, there's a bunch of people doing 3D printing online.

2:12:22Let me go find a 3D printing company or VR or whatever else. That's where the Coinbase investment, I think, came from. Saw the community there. There's other people that are specifically great at at pulling founders out of big tech companies. How do you think about the different lakes to fish in for the next generation of founders? Yeah, one of my mental models, I call it freshmen and seniors. And so, you know, like when I first met Justin Kahn, when he was doing Justin TV, which became Twitch, he's a year out of college and he's sold his prior company with Emmett Shear on eBay. And, you know, these guys didn't know much about business.

2:13:00They sold their company. You don't know this story? No. Yeah, their first YC company. I mean, you can tell it. You know it better than I do. Oh, yeah. So I'm sitting at a coffee shop with the Weebly guys, and they were pitching me. And the pitch is almost over. And I see this guy show up in the door of the coffee shop. And he's wearing a baseball cap and a camera on it and wires going into a backpack. And I remember thinking, that's kind of a strange dude. I wonder what's up with that guy. And, you know, as the meeting's wrapping up, he's walking into the place. And David Rasenko of Weebly goes, did you get your email earlier today?

2:13:32I was like, what are you talking about? Well, we got this friend, Justin Kahn. He's got this new idea, Justin TV. And right then Justin sits down and turns his laptop around and I'm on the laptop screen because his camera is looking at my face. And he said, I'm going to do a 24 seven reality show of my life and broadcast on the Internet. And I was like, Justin, that's that's one of the dumbest things I ever heard. Like, that's not even how reality TV works. You know, he scripted. piece of stuff. He stripped it and they condense it down. Nobody wants to watch you like you're some fish cam all the time, right?

2:14:06Like that's not, like you're not even describing what the business is. And he's like, you're supposed to be a seed OG. Why are you shitting on my idea? And I was like, you know, it's terrible, but like, what's, how do you even do it? What's in your backpack? And so he showed me how Kyle Vogt, right, who was a genius, uh, had designed this thing that did EVDO cellular combined with internet software. And so that night I was just like researching them a little bit more and i'd seen that justin and emmett had sold their prior company on ebay so they had a calendar company called kiko and uh it's an ajax calendar at the time and google decides to google calendar and they're like okay we're out of business so why don't we try to sell this so they they try to sell it normal ways nobody will buy it so they just put the company on ebay and they sell it to two cows for 250 000 there we go incredible and i thought you know Just common sense.

2:14:58We want to sell something. I don't know. Put it on a big marketplace. But one of the things back to kind of where do you look for things? I like I call those freshman founders because they they they haven't been polluted by the conventional wisdom echo chamber of the valley yet. They think that all you need to do is build stuff and sell stuff and the rest of it is a waste of time. they don't even know that there's time to waste other than doing those things because they don't have to unlearn anything they don't know much yet uh and that ends up being really valuable because they end up caring about the right things and then um sophomores and juniors i have less luck with so the sophomores are like they read a few too many blogs they spend a little too much time on twitter they know a little bit too much that's not worth knowing uh and then the juniors are the worst they've um worked at google and facebook and a bunch of fancy companies and they decide it's time to be anointed as a founder and so they raise a five million dollar seed round and pay their buddies a quarter of a million bucks a year each and uh usually you know run out of money halfway into it raise some more and then they decide not to do it because they can get a bigger job that pays better back at a big it's also interesting too with justin he he didn't have enough experience to realize that it was a dumb business opportunity to stream his life.

2:16:22But then it turned out, you know, over a decade later, some of the most popular streaming content is people just filming their entire lives. Like he was just living 20 years in the future. Yeah, Justin wanted to be an influencer before there was such a word, right? He wanted to be Internet famous. And so what you realize in hindsight is he was trying to solve a problem he had. and and those are the the types of freshmen that i've had the best luck with they're scratching their own itch right they're living in the future uh they they don't really even think at first that it's a business opportunity you know mark andreessen when he did the mosaic browser when he's 21 years old he's just trying to make the internet useful and it wasn't and so he built what was missing uh and then the seniors i've had luck with too like um uh cass or unis at applied intuition oh yeah a little bit of luck i love i love him every time he comes on the show it's so much fun he's yeah and so so like the thing about casser is he was experienced enough that he knew that what matters is building and selling and all the other stuff is window dressing and so ironically the the freshmen and the seniors have the same priorities but for different reasons you know the freshmen have the benefit of the beginner's mind and they don't know a bunch of stuff that gets in the way of them succeeding and then the seniors know enough to know that some of it's not important yeah that it's yes and so they they focus on the stuff that matters and i i love working with both because with the freshman founders you're trying to help them avoid avoidable mistakes whereas with somebody like castor younis you're trying to help them run up the score you know because like you know he knows what he's doing uh you know he doesn't have to learn business 101 one, but, um, you know, there are, there are other things where you could be helpful.

2:18:09Yeah. I haven't noticed that my, my, my first, my first company, uh, an ad network was like very freshman mindset. I mean, I was, uh, very young at the time, but it was like, get something for one price, sell it for another and just do that over and over. And you're going to have a business. And then my second company was like, oh, we need a wedge products and we need to do this and that. and like if we're going to do this and then that and then uh that that's a really you know created something complicated because maybe i had read too many uh memos on on tech twitter or whatever and then third being tbpn it's like we just we have a daily show we try to make it better every single day and we just do that over and over so i think you can see that kind of freshman or senior mindset even across an entrepreneur's companies yeah and i think the other thing you guys did, well, I don't know.

2:19:01I wasn't there when it happened. But I imagine that when you started it, you weren't super attached to how successful it had to be. It was like you take a small enough risk that you're not attached to whether the risk pays off or not. And if it starts to go your way, you just do more of it. And a lot of the great startups that I've gotten involved with had that quality where you didn't try to think of a startup. You were just doing something that was interesting and it just kind of fed on itself. And then one thing led to another. Yeah. Who else sticks out as that freshman archetype that you've worked with in your career?

2:19:36I'd say the guys at Weebly were that way. So that was a very, that was a very fortuitous two hours, you know, in that coffee shop, one after the other. Two deals in one hour, you know, that did really well. Just do that every day and you'll produce trillions of dollars in return. Talk to me about Weebly's business, how it grew, the actual economics of that industry. And then I want to bridge to your take on the new crop of site builders. Because we've been having this debate over the lovables and the different companies that are playing in this space, VZero. There's a whole bunch. And we're kind of going back and forth on like, is it just such a big market that everyone wins and everyone builds a huge business?

2:20:22Or is there some sort of winner-take-all dynamic? So if you could walk through the Weebly story and then kind of bridge to modern web development, I'd love to hear that story. Yeah, and the Weebly, it may not satisfy our modern desires, but it's kind of interesting. So these guys were about to graduate from Penn State, and I think we invested, I think they raised$650 ,000 at$2 million pre-money. and it was like Anderson and Iden Senkit a couple guys yeah those were back in the days when Paul Graham would call you to make sure you were going to show up at demo day right because the batches be like 10 to 15 companies and so so I remember it's like two months after uh the money's cleared and have another site visit with them and I'm like huh you know we ought to start thinking about what we're going to need to do to be ready to raise a series a and i said so what do you guys think we need to do to be ready to raise a series a and they look at me like what are you talking about and i say well you know you've raised 650 000 and they look at me like i know right and i realized that like to them 650 000 it might as well been 650 million right there's more money they they they were surprised it was legal for them to have that much money and so they they ended up um they ended up not raising money again until many, many years later from Sequoia.

2:21:48And at that time, I think we were like 65 times in the money on the investment. So I don't know that it gives any lessons for today's world other than just, I kind of make fun of my ability to predict how these things are going to turn out. And that's why I'm so founder focused, right? I just think that determination is just such the high order bit. Do you think venture is an easier or harder game than it was back when you could invest$650K to two cap into some great founders? Because in some ways, it's much more competitive now, but also the nature of there being more capital means that... And for extra reference, Weebly, I mean, I'm not sure if this is 100 % right, Because an overview, but acquired by Block Square for$365 million in cash and stock in April 2018,$365 million.

2:22:42That's a seed round nowadays. Oh, yeah. It's a good next dream. So there's no question it's gotten harder as an investor, right? And I think even as a builder, I think there's a lot more distractions right now for the founders. And there's a lot more sloppiness on the playing field. And so you've got to play the game that's on the field, whether you're an investor or a founder. I think, you know, back in the days when, you know, Justin and Emmett were doing Twitch or, you know, what became Twitch or David and those guys, Dan doing Weebly. I think it was more of an act of rebellion to start a startup, right?

2:23:20The dot-com meltdown had happened about five years prior. You know, startups were not a popular, sexy path for people. It was the path for people who didn't want to have a job at a normal company. And that was the only way they could avoid it. It's incredibly trendy right now. It has become like so much trash. It's trendy and it's comfortable. It's tracked. If somebody can quit their job in big tech and then maybe they're not making quite as much, but they've got a nice office and they can, like you said, hire all their friends. I will throw out a counter to this, which is I was thinking about the El Segundo companies and the hard tech companies.

2:23:59I don't know if you've spent any time with those folks, but that feels like Mountain View in 2008 to me where these founders are taking extreme risk. There's not going to be a$10 billion acquihire from some Mag7 company for your rain cloud seeding company. Like if it fails, you're getting a normal job. And you're not doing tons of secondary and raising a ton of money and hiring everybody. And so you really are burning more of the ships when you do one of these crazy hard tech companies. But I don't know if you spend any time with those or you have a take on that. It's funny you say that. So I think it may have been the only company I invested in in 2021.

2:24:39Certainly in the second half was a company called Hadrian. Oh, yeah. Yeah. And like I just think Chris Bauer is a stud, right? And it's like, you know, what we're describing about the types of founders who overcome obstacles and can move the world down a different path. He's one of those. Yep. And so, but he's a perfect illustration, right, of what you're looking for. And I mean, I don't know if 2021 is the exact year, but like there were a couple of years there where like you could see the toll that the business was taking on him. Like he was working extremely hard and you could tell that it was not, there was not some cushy, soft landing for him.

2:25:19It's like either you build the thing, you get it to work and it becomes really big or you're kind of screwed. I don't know. Being a real founder in some ways is more of a curse, right? Like people, it's just like, it's not a fun job. It's kind of a shit job. And it's like if people really understood and it's, but it's like you're, you're called to do the thing. and so you can't not do it so it's it it doesn't feel like you have any choice but to do it because the you know there's no way chris isn't going to do hadrian right he's just too he's just too high agency and too high commit commitment to to let it fail right and so yeah you ask any any founder what the lowest point in their life is and it's probably has to do with their business right maybe some family thing but almost always they have like a specific moment where they're everything Yeah, zooming out, I was reading the Caesars Palace coup this weekend about the birth of Apollo, the private equity group.

2:26:20And I was thinking about how there's these eras in finance when there's booms, like the LBO boom in the 80s, the high frequency trading boom. And then there's multiple venture booms. But I was wondering, I was trying to think about like, who's the person like under 40 who's building the next great financial firm? Like there are lots of great young investors who are writing checks or building companies. And there's a lot of founders. But I was having trouble putting my finger on someone who's young and actually set on building a financial firm of some course. I don't know if anyone comes to mind for you.

2:26:59I asked ChatGPT and the answer it gave me was Josh Kushner, which is great. It's true. But also it's like he's an investor in OpenAI. So I don't know if it's fair play. But is there anyone else that you've seen that maybe is taking a different tact in building a financial firm for the future? Like what your advice would be to somebody who wants to actually make a career out of venture capital? Leopold's another good one, I think. Yeah. It's a good question. I haven't seen a lot. You know, one way I would come at that question is to say, what is the financial product that entrepreneurs aren't getting?

2:27:36And I think that it's probably some combination of venture capital meets project finance. And so I think you have some of these that are, you know, in the world of atoms and bits. And it only seems like Elon Musk and Palmer Luckey and a few other guys have been able to pull them off. And you could say, well, that's because there aren't many of those. And I think that's true. But another way to come at that might be to ask, you know, is it is it a good thing that Elon had to basically bet his entire PayPal fortune to make Tesla a possibility? And but for that, there would be no Tesla because he had to bet all of his winnings on that.

2:28:14And I think Palmer probably similarly invested a lot, but he also had help with the founders fund folks who were pretty, pretty, you know, off the beaten path at the time. So I do think that there is a legitimate argument that says that a lot of our institutions that combine the worlds of atoms and bits need to be reimagined. And people say, why does a venture capital do that? But I don't think venture capital as it's designed today is tailor fit for that. I think it's probably some type of new innovation, right? And it would be almost the opposite direction of YC. It'd be something that is more in the upstream capital markets rather than lean startups and that kind of thing.

2:28:53But I think I think that could be kind of interesting. I'd like to see somebody do that. Yeah, we're starting to see a little bit of that with, I mean, you hear a lot about those hard tech rounds where it's very clear that the headline number is a mix of debt and equity. And that's usually two different firms. And then there's always been this question of like, is there a way to bring some sort of like Silicon Valley technologist mindset to essentially a turnaround of a legacy company where there are some assets? but there's something that the company can stand. Like that was what Chris Power at Hadrian was working on before he was doing a search fund.

2:29:34Yeah. Yeah. And it's, and it's interesting, right? There, there are some people that I look to. Another guy would be the, the Stefan Boncel of Moderna, you know, like you have some companies, like, like one company I was involved with back in the day was Okta. And when you saw Okta, you're like, okay, these guys are from Salesforce. They're really smart. They're saying there's going to be lots of cloud apps. They're going to need identity management. And I was like, sounds good to me, right? But you're like, that's a very plausible future. And they're the perfect guys to do it. There are other futures that are going to take a lot longer to happen and much more divergent from the present.

2:30:10I think that Moderna was that way, right? 10 years and$5 billion before they ship a product. SpaceX is that way. Tesla's that way. And so to me, the interesting question becomes, can you come up with technical risk takeout gates where you'd have funding that follows the initial funding? And then you don't have to have somebody like Elon Musk be a miraculous fundraiser going throughout the world trying to find money wherever it exists. People forget that's how it was 10 years ago, right? Even after they went public. And so I'd like to see the capital markets. Part of what was good about seed investing back when I was doing it at first or Josh, was that we were doing something that entrepreneurs needed that they weren't getting.

2:30:54And so to me, most of the good answers in financial innovation have something to do with that. You have somebody who would make great productive use of capital is not getting it somehow. And the markets have a gap in their ability to supply that capital in that way. Well, I think in the case of Hadrian, aren't the capital markets working quite well in the sense that he raised a bunch of risk capital and then was able to de-risk certain customer relationships and process. And then now we can access more traditional, you know, forms of debt. And I imagine if, you know, the American dynamism team at A16Z was watching this, they'd say, hey, Maples, what you just described, that's what we're doing.

2:31:36And there's a lot of truth to that. So, you know, I'm not sure Chris could have done Hadrian 10 years prior. And so I think that, you know, there were some changes that were happening that were creating the conditions. But I'd still like to see more, you know, like, for example, I personally invested in Boom Supersonic because I think that Blake is just wildly ambitious. We just need more people like that who we need to have permission-based innovation in the world of atoms and not just bits. And the more we can do that, I think, the better. Yeah. And so that's what I think is missing. Yeah. I mean, at a high level, it feels like entrepreneurs are pretty catered to on the capital market side?

2:32:18Like there is dollars at every scale, every order of magnitude. I mean, we're seeing$100 billion rounds and then people can snap their fingers on X and raise 100K in the DMs if they need to. Yeah, I don't think I've met, I haven't met an incredible founder in the last five years. Somebody that, you know, just personally I feel is incredible that hasn't been able to raise. Yeah, that has that part of their origin story. Like they might have other struggles. Oh yeah, we got in a lawsuit or, you know, we had to pivot entirely because some company steamrolled us or we misanticipated the progress of some underlying technology.

2:32:55But the, oh, yeah, we couldn't raise for five years. That's not really a story right now. Maybe the bigger question to answer in just the broader Silicon Valley is, like, how do you get more of those freshmen, those weird thinkers, those people who are going to go from Groupon to building supersonic planes? that's a crazy move. Yeah. How do you get people that aren't just seeking status? Exactly. People less base hits, more swing for the fences. And by the way, I think part of the reason that the people who succeed at it do is like, I think Elon's great superpower among many is that he only pursues business ideas where he existentially refuses to fail.

2:33:40And so like Elon never starts a company and says, well, I hope it works out. Easy come, easy go. If it doesn't, you know, he's like, I'm only going to tackle problems where I will never freaking back down ever, no matter what. And so like, if you say, hey, getting to Mars is the most important accomplishment I want to achieve in my life. You don't sit there and handicap the odds. You're like Han Solo, right? In an asteroid. You're like, don't tell me the odds, right? You're like, this is worth pursuing, even if the odds are against me. And that has a way of impacting the odds, right, of your ability to succeed where others can't.

2:34:14Because if you'll even countenance the possibility of failure, it changes the equation, right? It changes the whole risk that you take. Where do you think we are on the AI hype cycle? The Gartner hype cycle. Peak of inflated expectations, or are we headed for the trough of disillusionment? Oh, man, probably all the above.

2:34:38Here's what I've been thinking a lot about is in the era of the microprocessors, you had mass computation and then the Internet, you had mass connectivity. And what got commoditized with micro age was the transistor. And then you had the packet get commoditized. And so what I'm interested in is what happens in a world where we have mass cognition and where the inference unit becomes commodity. Because right now, everybody's talking about the inputs, NVIDIA chips, hyperscaler models. Do we need more energy? And all those things are valuable. But it's just like in the early days of the PC era, everybody talked about the hardware.

2:35:17People didn't talk about software until much later. And so I think what's interesting to me is to ask not what's happening, but what is going to become scarce given all the stuff that's happening. You know, what will the new scarcity be? I don't think that's been determined yet. So that gives me a lot of optimism. But it's not the latest model du jour and it's not the latest chip du jour. It's not the it's not the latest scaling factor that makes things more abundant. It's the thing that becomes rate limited in a world where it's a given that the new abundance happens. And so that's what I'm looking for these days.

2:35:55So, you know, in a world where microprocessing is free, software becomes scarce because you have to make all these machines useful that are everywhere. And in a world where the packet is free, what becomes valuable is the owners of these networks that aggregate attention and users and create network effects and become the systems of record. And so, OK, what will be the monopoly AI companies in a world where cognition is abundant? I don't think we know yet. But to me, that is the question that is really interesting. That is 100 % the question. That is fantastic. I love that. I've been to be digging into that for years.

2:36:32That's a fantastic question. He wrote the microcosm and then the telecosm. I wish George Gilder would write the cognitocosm and talk about what's going to be the new scarcity that complements the new abundance. It used to be that we didn't have enough Reddit threads on niche topics. And now the LLMs will just hallucinate one for you. That's crazy. Anyway, we're keeping our next guest waiting. But this was fantastic. We'd love for you to hop back on and continue the conversation. I really enjoyed this. Hope you have a good trip to the coffee shop later. Hopefully you meet the next Justin Kahn and the Weebly founders.

2:37:11I could get another twofer in the next three months. I'd be happy. We're rooting for you. Hopefully at a two cap again. Yeah. Yeah. Yeah. Bring back the two cap. Bring back the two cap. Yeah. My new, yeah, twofer in two hours and a two cap. Incredible. Deal. Well, thanks so much for hopping on, Mike. We'll talk to you soon. Cheers, Mike. Have a good one. Let me tell you about adquick.com, 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.

2:37:45Our next guest is in the Restream waiting room. And as a benefit of Restream, we got our first commenter on LinkedIn, I believe. Let's go. The chat is just blowing up. We have chatters on access, open CV here. I see folks on YouTube. Thank you. Thank you. You are live on TBPN. Welcome to the stream. How are you doing? Woo! I'm feeling good. Great to be here. Thanks for having me. Do you remember meeting me? We met in near Stanford like a decade ago with Ankur Jane, who now runs that amazing fintech. Built. Built. Yes. Am I misremembering that? Do you remember this? I think we met years ago with Ankur.

2:38:26This is when I was at Human? Yes, I think so. Okay. Awesome. Good to see you again. Good to see you again. But how would you describe where you are right now? Give us the intro. Introduce yourself to the folks who are watching. I am a general partner at Long Journey Ventures. We're a pre-seed and seed stage firm. And our core thesis is that we think the biggest companies of tomorrow will look really weird at the pre-seed and seed stages. And our mission is to be the second believer in the magically weird. There are so many weird things in the portfolio. Well, hey, we had Cyan and Lee on the show, what was it, a couple months ago, talking about the Diamond Company, the cloud seeding company, I believe, is in the portfolio.

2:39:11There's just weird stuff all over. What else is in the portfolio? And, of course, Justin is a close friend, venture partner. He's always investing in weird, silly things. And then, like, five years later, they're Decacorns. Totally. It's a good habit. Did they mention the robotic eyelash extension company? No, what's that? Explain that to me. Oh, yeah. It's a robot that applies eyelash extensions. Instead of taking an hour or hour and a half for a human to do it, the robot can do both eyes at the same time and it takes 15 minutes. That sounds high risk because if the robot flinches, it just rips your eyelashes out.

2:39:50Well, that's why they invented the anti-flinching technology. There you go. Patented. It doesn't flinch. I mean, humans flinch too, so it's not... It's all high risk. It's true. Superhuman unflinching AI. This is going to work. I'm glad you guys do this. Obviously, it seems like the rest of the partnership, we've had them all on the show. There's not enough people that are just actively trying to find the weird stuff, but you guys do it consistently. A lot of people say they want to find the weird stuff, and then it just winds up being a lot of B2B sass. Defense tag. whatever's on trend. Okay.

2:40:31We, we do quite a bit of defense tech too, but I think we were doing it back when it was weird or taboo. For sure. Two years ago. Yeah. Yeah. Uh, is there something to the now contrarian statement that occasionally you want to do consensus investing and you want to be the momentum trader? Uh, it's certainly paid off for people in AI over the last few years. Can you at least see the value in that? Oh, for sure. We have quite a bit of cognitive dissonance on the team because so many talented builders are building in AI. We want to play the game that's out on the field. But yeah, it kind of hurts our souls when things feel consensus.

2:41:17And it's a question like, are we too late? because I mean we feel like the best time to invest in seed and pre-seed is when things feel absurd or non-consensus and we want to we want to invest before they become consensus that's where the alpha is what's the uh uh what's in uh internally like your feeling on like the ai hype cycle uh where we are it feels like it's been like punishingly dominant for the last few years um are you overall expectations are inflated are there pockets of optimism how are you seeing kind of the overall ai boom uh sam altman recently said we might be in a bubble um which is kind of a crazy thing to say uh but who knows maybe he's having fun uh what what is your current thesis on like opportunity within ai yeah i mean we like to think of like the second order effects and especially have been looking more towards deep tech and the implications and how AI creates a tailwind for deep tech companies, robotics, biotech, et cetera, because we feel like working in those spaces, there's a lot of defensibility and doing something that's really hard.

2:42:35So that's kind of how we're thinking about it. how uh where yeah how do you dial in like um the the opportunity there obviously you have like big companies i mean tesla just put out this big the fourth master plan uh going into humanoids it seems like it's a it's an incredibly expensive place to play but then you know we we just had a friend send us a a new roomba that is just like a a new a new friendly robot vacuum cleaner and And it seems like, I mean, it's a fantastic product. I'm not exactly sure how the business is doing, but it seems like a fantastic business. I think they're doing really well.

2:43:13And those are like two wildly diverging opportunities. What are you seeing that's kind of interesting in the deep tech AI enabled, like AI tailwind world? Yeah, I mean, we're looking at everything across robotics because, I mean, there's just the ability to train robots because of LLMs and physical AI. I mean, it's just gotten so much faster and easier, which is, you know, the cost of training robots to do something that's actually creating value has just gone down immensely. So that is one of the tailwinds that we think has enabled. You know, we've invested in companies, you know, doing case picking and distribution centers.

2:43:56You know, we've invested in robotic eyelash extensions. Yeah, that's a great idea. You know, there are, you know, many, many applications of robots. We've looked at a lot of, you know, in-home robots. I'm not 100 % sure how people will feel with a humanoid-like figure in their home. I mean, I don't know if I personally want that, but. Yeah, yeah, yeah. On that, do you think that we're learning anything from the reception of the AI companionship to how robots will be received in the home? Because I agree with you that having a robot over there that's in my house seems maybe a little black mirror, a little odd.

2:44:44But at the same time, I also would never have predicted that, you know, millions of people would be complaining about chat GPT 4.0 going away because they saw it as a friend and a coach. And then, you know, Elon's going into the romantic space. And there's like all these different areas where it seems like people are actually, you know, incredibly receptive to having a personal relationship of whatever kind with the robot. Do you think there's something we can learn about that or from that? Absolutely. I mean, I am definitely reserve the right to change my opinion over time. But I think today it would be creepy and Black Mirror-esque.

2:45:22And I am much more into the idea of like ambient, you know, single purpose objects doing it, doing a task like something that lives in the laundry room. You know, moving your laundry or folding your laundry. And, you know, that can be one thing that lives there. And then I will have another thing that lives elsewhere. and I think like ambient robots, but not necessarily rosy. I completely agree with you. And yet I can immediately imagine the Black Mirror scenario where my laundry robot is like, John, I'd like to actually go trim the trees today. Like, you know. Or I figured out a way to run the laundry with the door open and I'm going to flood your home.

2:46:09We had somebody on the show that makes a bedroom lamp that can unfold your laundry. It was the exact one. Oh, yeah, I talked to that company. I love it. It's really cool. But the thing is, you could easily imagine the black mirror scenario where the lamps just start killing. Just poking you. Yeah, it really lent itself to the dystopian world. How do you guys talk about timelines? Because something that stood out to me from conversations with Lee and Justin, and I know you guys are talking all the time about deals, is they're willing, from my sense, is they're willing to invest in a founder and be okay with them going and just wandering and tinkering for a long period of time.

2:46:50And there's less of this pressure of like, okay, we're leading your seed and then you're going to sprint to the A, like hopefully later this year. Did we do the seed in Crusoe or something like that? Yes. Yeah, it's a crazy deal. I mean, I think it would be rough if we were named Long Journey Ventures. Oh yeah. But you have to get to the series A. Long Journey, short time, right? Or actually medium journey. Yeah. I'm going to pump more money in this thing. But yeah, I mean, like unpack a little bit more about like, is that just matching finding the right founders? Is it a specific vibe that you bring?

2:47:25Is that like not taking a board seat, taking a board seat, coaching the founder? We do not take board seats. Yeah, we do not typically take board seats. And yeah, I think sometimes, you know, when you're investing in the absurd before it becomes consensus, sometimes you whiff you whiff it yeah of course and you know it's just a matter of talking that through with the founder and usually the founder realizes it even before you do and so yeah we have quite a few companies that end up pivoting and re-navigating the idea maze but uh but yeah sometimes it lands and then you're one of the earliest investors in something incredible like Crusoe so yeah yeah what a crazy car for the course yeah um yeah what uh how have you been processing the uh all all the news about like uh Jevin's paradox and like the uh the the token costs coming down but then companies using more expensive models and maybe this is gonna hurt margins and whatnot like did you did uh did you go through the same roller coaster ride that most people did during like the deep seek moment or how are you, how are you processing the overall, uh, temperature of like how the, the, the latest trends in the AI models just affect like the, the companies that are actually building on this technology day to day?

2:48:48Yeah. I mean, I think the cost reductions are obviously extremely significant. And, and I think, you know, people right now, a lot of enterprises are in the kind of pilot or experimental phase where I think they want to use the highest performance models based on the academic benchmarks. But I think cost reduction or the cost profile will really come into play when people want to start deploying AI companions to all their employees or autonomous background agents. These sort of deployments across many workloads that will consume a lot of tokens, then I think costs will really matter. So I think that's kind of like what I'm looking out for is, you know, not just increases in performance, but how these cost reductions will enable, you know, scaling more use cases.

2:49:44yeah yeah we were debating notion earlier uh ivan said that uh these gross margins went from just just scraping by at 90 percent and now it's down at 80 percent and uh to me it seemed like it seemed like right i'd take all day long for for growth and a better product and something that's ai enabled uh of course you got to build the right the right product in there but it seemed like uh seemed like a no-brainer and that's probably why he's he's uh talking to chris memes at the Wall Street Journal about it. It was interesting. And I think like this sentiment has been interesting. It almost feels like the general reaction or like the gen pop reaction to new models is that we're almost in like the iPhone era.

2:50:28I mean, I remember when people used to wait in line, people freaked out about like new iOS releases and new iPhone releases. And now people are like kind of deeply ambivalent about whether they're going to get the new iPhone or not. But it almost feels like the public feels like we're in that spot with the newest AI models. But I feel like that misses the picture on the cost reduction side, which I think is really powerful. Yeah, I mean, it's interesting. doesn't uh i mean this is why so many people are so bullish on on chat gpt and open ai despite all the chaos and competition is as you go walk to the average person down the street have you tried any ais they'll say yeah i've used chat gpt it's cool and then if you go to those same people and say hey i have a something like chat gpt it's it's twice as good they're gonna tell you okay okay, I don't know.

2:51:25I don't know what that's really going to do for me. So, uh, yeah, it's, it felt like six months ago we were in this era again. It was like the early iPhone days, like you said, where it was like, Oh, a new model came out. Let me rush to try it. And now there's way less of that, that energy. So yeah, totally. It's good for the, uh, the new incumbents. We were talking to Maples about this, uh, at the early stage, uh, well, like, like the, this analogy of like finding good lakes to fish in for outside the box thinkers, entrepreneurs that might be up for a long journey, they might wander for years.

2:52:04Like where are, where are some of the underrated places where you're seeing pockets of entrepreneurial talent bubble up? Like there, years ago, it was like, you know, like the, the PayPal mafia was like a massive explosion of like, just back all those companies. They're huge. The same thing happened with other, other big tech companies that threw off a ton of talented entrepreneurs. There was like the invest in every Stanford grad phase there, you know, get kids to drop out of college to do startups. Like where are the interesting pockets of entrepreneurial talent that you're seeing just across the globe?

2:52:43You know, we're just, you know, waiting outside YC demo day. No, just kidding. We have partnered with a really cool organization. I am really excited about where they're going. It's called Edge Institute and they run these monthly pop-ups called Edge Esmeralda. They're about to do a month-long one in Patagonia. They did one in Healdsburg back in June and it attracts a lot of weird thinkers. It's not all founders. It's a lot of like researchers and you know people who aren't necessarily in the kind of entrepreneurial ecosystem but it's a lot of people with crazy ideas I mean that's the whole concept is edge edge city people living on the edge doing things on the edge and um operating you know in not necessarily societally accepted ways right now but like probably will be consensus in the future yeah that seems like a good good uh pool to fish in just like weird thinkers academics just anyone who's yes just yeah they might not be a founder themselves but they're like hey my my friend is working on this or maybe they could be crazy idea yeah yeah i love that yeah we we did our residency program uh in hillsburg uh back in june and edge esmeralda is also building a city right Can you tell me about it?

2:54:05What's the progress there? How's that going? They have bought a site for it. And are planning the city itself. It's Devin, right? I'm not sure how much is public. Yeah, Devin. Yeah, we've got to have her on the show. That'd be great. Yeah, you've got to have her on the show. Yeah. Devin Zugal, right? Is that the name? I think that's her last name. I believe so. Yes. Anyway, we will get her on the show. Yeah, she's awesome. Thank you so much for taking the time to hop on. Yeah, great to chat. Yeah, thanks for having me. Awesome. Talk soon. Bye. Cheers. Let me tell you about Bezel. Get bezel.com.

2:54:43Your bezel concierge. They will now source you any watch on the planet. Seriously, any watch. So results from the Google ruling. Yes. They don't have to sell Chrome. Okay. And they don't have to stop paying to be the preferred search provider. So total, total big tech victory. Let's go to Tyler. did anything happen has anything ever happened nothing happened the no on play market continues to print every time no Tyler is our official did anything happen correspondent what was the point of all this just to waste a bunch of time and attention also will not be required to divest Android well I mean something happened if you're a lawyer collecting a paycheck that's true I mean after like what five years This is five years Wait is this the final final final Or is this like V1 final I don't know we need to figure that out Somebody posted Meek Mill about to raise 25 mil From A16Z Meek Mill quoted it and said my first time hearing that But lol But for real I need investors I don't think they're on Twitter What Donald Boat responded and said DM Meek, Donald Boat will lead you around, but first you need to buy him a private jet.

2:56:07Yeah, what a crazy... He needs a jet. Yeah, so I mean, the news here is Meek Mill, the rapper, is going to start an AI company of some sort. Yeah, it went viral a couple of days ago, working on an AI tool that can change the world, lol. The funniest thing was that in the screenshot he posted, he'd switched it to 4.0, and so everyone was like, he's been one shot, he's been one shot. I mean, it really, yeah, he had a spec or OpenCV basically. Hopped in the chat and said that. No, he was, yeah, he specifically highlighted that Meek had gone back to 4.0. So you can imagine he's deep in the prompts and like, okay, me and ChatGPT figured out the next, the AI app that's going to disrupt ChatGPT.

2:56:53That's great. Love to see it. Yeah, I do switch back to 4.0 every once in a while, but only when I want it to write a really obviously one-shotted piece of prose. You're right, John. Yeah, exactly. So if I want to write something that's like, it's not this, it's that. It's more than this. It's actually that. And use a lot of em dashes, I'll fire up 4.0 and give it a little teaser. The comments on this are, Shkreli comments, let me know if you need help. I got 100 goons ready to go for you. Bone GPT your favorite rapper's favorite rapper Reginald says Mr. Mill I'm a well-known AI practitioner I think you should collaborate with Cluelly your friend these are some of the most innovative companies in the space happy to talk you through some of the players if you're interested VC Bragg just says top okay anyway let's switch over to Ron Rule he says this is pathetic Gen Z in the workplace.

2:57:51This is a poll from Fox News. They say 77 % of Gen Z in the workforce admitted to bringing a parent to a job interview. 53 % of parents spoke with a hiring manager on their behalf. 73 % parents helped complete work assignments. 45 % regularly have a parent talk to their current manager. I think we're pro-parent workplace here at TBPN. We've had many parents stop by the Ultra Dome and it's been great. I don't mind talking to some parents about stuff. And I say, hey, if anyone on the team needs to have their parents come in and help complete some work assignments, do it. Tyler, you want to bring your dad in and have him five code something for us?

2:58:30I think my parents are coming on Friday. Fantastic. Put them to work. Just let them know. They've got to be in the 73 % of parents that help complete work assignments. Mr. Cosgrove, you will be using quad code today. Yeah, we're fully in support of all the team's parents just helping them with their job. In fact, I would insist that they come and they pull their weight and they help organize the information. I think we had Michael's parent in the Ultra Dome recently. I think get him on the switcher. Get him on the pull the graphics up. We need all hands on deck. Get the parents in here. This is a pro-parent workplace.

2:59:08Anyway, the great lock-in of September to December has begun. this is just a general announcement it's also bulking season folks we've seen this it was teased earlier by will at uh at open ai he said the de-twinkification process has begun we are of course sending him some mass gainer on his journey to become a mass monster um but you're a great lock-in what many are saying that it's bearish for open ai it's bearish that he's de-twinkifying why why would that be i'm in the gym that could be no it's literally keyboard it's wait oh it's bearish because he's turning into a bear? Because he's going to be as large as a bear, like a hairy bear man or something?

2:59:48I'm just imagining Will. Wait, is that the actual joke? Like twink and bear? Like bearish? Because like the opposite of a twink is a bear? I don't know. Okay, I don't know. I think it's bullish. I think it's very good. I hope he turns into a bull and gets yoked like a bull. That would be very, very, very good. Lift heavy, run far, marry early, eat steak and eggs. We didn't really talk about this post. We missed this post. This was burning up the timeline over the weekend. Yeah, this was, let me try to find the original quote. It's deeper in the stack. And people like to hate on it. Jira Ticket, I mean, everyone was having their take.

3:00:23Some people were hating. Some people were just having fun. Jira Ticket said, the current vibe is drinking drugs 10 to 3, 5 days a week. Lift heavy, run far, marry whoever, stay up late, eat spicy Szechuan food. That's pretty funny. yeah I don't know this was something that was like very dunkable but you know the yeah this made me when when I thought it was fine the actual quote was the current vibe is no drinking no drugs 996 lift heavy run far marry early tracks sleep eat steak and eggs and I resonated with this so deeply that it made me want to start doing drugs Wait, why? Well, I'm just this exactly tracks with my life.

3:01:06Oh, yes. No drinking, no drugs. Yes, it is now so consensus to do this. Very early track sleep, eat state next. I was like, it's time to start binge drinking. This was sort of the top for that concept. But, you know, I think overall that take is more correct. It's just more from first principles, more foundationally true than not. And so it should stand the test of time as roughly correct, even if it's phrased in a little bit of an incendiary, frothy style. I respect that founder going to the Wall Street Journal he quoted in or something. I don't know. Talking to a journo like that's pretty funny to me.

3:01:51I think it's fun. The current vibe. I think it's a funny quote, and I don't think it needs to be fully dunked on. I think you can just have fun with it. Anyway. Well, on that note, we've got to get on. Wander, find your happy place. Book a wander with inspiring views, hotel-grade amenities, dreamy beds, top-tier cleaning, 24-7 concierge service. It's a vacation home, but better. And we do have to get on with Pyongyang. So we are going to hop on the phone. Now, they may send a nuke if we don't. Pyongyang Investment Fund, PIF. you've heard a lot of founders raising PIF they're talking about Pyongyang Investment Fund folks we gotta hop on with Pyongyang see you guys later it's gonna be a big week thanks for hanging out have a great evening it's great to see all of you go out there don't get one-shotted by 4.0 void 4.0 oh thanks Max the SF standard thanks Gabe, Daniel everyone who listened good hanging out with you guys talk to you soon bye