Microsoft, Meta, & Tesla Earnings, Google DeepMind's Project Genie, SpaceX & xAI Merger | Anton Osika, Christian Garrett & Delian Asparouhov, Eric Seufert, Kevin Weil, Mehul Nariyawala

27:46Let's talk about Tesla. Tesla reported revenue at$24.9 billion. And this beat the consensus estimate just slightly. Consensus was$24.78 billion. But down 11.4 % from the previous quarter when revenue was 28.1 and 3 % decline year over year. And Tesla's down 2 % this morning. There was also a 61 % drop in profit. And they're shuttering the high-end models of production. So they're stopping producing Model S's and Model X's. Which I think the Model S and Model X features will be sort of rolled into trim levels. Like we've already heard about the... So I was debating Jordi about this earlier. I thought that the Model Y and the Model X were the same length.

28:36The Model X is in fact almost a foot longer. So it is a bigger vehicle. They both have the option to have three rows. They both have very similar specs. But the Model X is bigger. But in China, we've heard that they're working on the Model YL, Which is a long wheelbase version that will be I believe longer than the Model X So you have the ability to get a big Model Y And then they're already doing different trim levels with long range Plaid, so if you take the Plaid badge and you put that on the Model Y L and then you add Different specs and you say oh, I want to spec my Model Y with Goldwing doors maybe all of a sudden you're back in Model X territory and you're dropping 100k, but there's just no There's no denying that the Model S and X sales have slowed, and there's a whole bunch more competition at the high-end EV market from Lucid, Rivian.

29:29And so Elon is fully thinking about what's next. He broke out subscriptions for autopilot self-driving for the first time. He's talking a huge amount about cybercabs and robo-taxis. He's making that cash investment in XAI. And, of course, he's really focused on optimist humanoid robots. And it seems like he could be scaling up production there very, very quickly. And so analysts... He has a million subs of full self-driving. Yeah, not bad. And it's, what,$89? I actually don't know. I think... You can look it up. I think I remember it's$89 a month. Yeah. But analysts... How much is it? I guess$49 a month for vehicles with enhanced autopilot.

30:13Okay. There are a few tiers. Yeah. I mean, if you build up the subscription. What is it? How much is it? I think it's 100. 100 a month? Yeah. Yeah. So, you know, you got a billion dollars a year coming in from that. Not bad. And, of course, very high margin because you don't need to manufacture it. Analysts thought Tesla was going to be cash flow negative for the quarter, but they actually were positive. They generated$1.4 billion in free cash flow, and this was down just 30%. So there's plenty of cash to keep the aggressive investments going, especially as Elon shifts the business towards autonomy.

30:45He's not shy about making the change aggressively. He said, we would expect over time to make far more cyber cabs than all of our other vehicles combined. So he's fully, fully going all in on that. Yeah, I think it's a little jarring for some people just because historically car companies have thrived by creating the perfect car in each category for every different consumer. and Elon is basically saying, actually, I know what you want, and I'm going to give you it. You don't need that many options. You're going to be able, like you said, to just leverage the different trim levels and spec out the car to satisfy.

31:22I do think over time, less and less trim levels, and then eventually it's just cyber cabs and no one's buying cars anymore, if it really goes that way. I think this rollout will be slow. I mean, the original rollout of the electric car was 20 years, right, for Tesla to actually get to saturation where you're seeing electric cars all over the roads. It'll probably be the same with people giving up their cars and going all in on, I only use Waymo and Tesla, CyberCab, or maybe I just use one. But Elon's certainly thinking in decades and not afraid to cut an entire business line that is still popular with a lot of people.

31:59I mean, I was just talking to somebody yesterday who was singing the praises of his Tesla Model X and how much he loves that and how he would never get a Y because the X is so much more premium. Everything about it's better. It cost a lot of money when he bought it. Still loves it. But, you know, Elon's thinking to the future. Anyway, Gemini 3 Pro, Google's most intelligent model yet. State-of-the-art reasoning, next-level vibe coding, and deep multimodal understanding. I love that sound so much. I know you do. Tesla also announced a$2 billion investment into XAI. They just did 20. Is this part of the 20, I wonder?

32:38I don't know. But yeah, so there was a non-binding Tesla shareholder vote on authorizing an investment in XAI that failed, although 1.06 billion votes were in favor versus 960 million against.

32:54Abstentations? Abstentions. Like, like, like, like, staining. Yeah. Not one or the other. Yeah, yeah, yeah. Counted as no under Tesla bylaws leading to rejection. So they had run this as a vote. It got rejected. But Elon said, we're doing it anyways. Doing it live. Let's go to some timeline reactions. Yeah, pull up this. I don't know where you want to start, but take him has a good one. If you want to start there with Microsoft. I wanted to pull up this video of Optimus learning it has to make up for S slash X. after they were canceled. Oh, yeah. This is such a crazy video. Taking off the VR headset and just smashing that.

33:34I love it. This is really a Tesla Optimus, isn't it? At the same time, the motion's remarkable. And the force with which the Optimus just smashes a water bottle open is crazy. It's amazing. This thing is going to be super powerful. The insurance business that will be built around having a humanoid in your home is going to be remarkable. Remarkable. You're also going to need to secure these things. So let me tell you about CrowdStrike. Your business is AI. Their business is securing it. CrowdStrike secures AI and stops breaches. This was one of the standout moments of the earnings call for me. Elon and Tesla are transitioning their Fremont facility to make Optimus.

34:15And they plan to scale that facility up to be able to make a million of these things a year on a relatively near-term time horizon. So very, very significant. He talked about how the robot would be able to basically learn on the job. It's going to be able to do a number of valuable tasks. And, yeah, I think, I mean, the big question for me is, like, what is... That's a good question for me. Will they have an ad support? You have the Tesla walking around your house, and it sees you pull out some sort of random credit card, and it's like, are you not on a ramp? Like, what's going on here? Or it sees you, like, having, like, eating vegetables.

34:53Would you like a smoothie from Athletic Greens? Yeah, exactly. Yeah. But yeah, we'll see. So the question I have is at what point will humanoids actually be like ROI positive for consumers in the home or even just everyday businesses? Yeah. And I would just judge that based on like, okay, you're buying this thing up front. Yeah. Maybe a business finances it. Maybe somebody finances it or they just pay cash. but is it valuable enough to actually replace a human? Because you're competing with, the optimist is going to be competing with jobs that are maybe like 40, 50, 60 a year, like somewhere in that range.

35:34And so that's a pretty high bar to clear. Totally. So we'll see. Yeah, and the risk-reward calculation of, okay, you have this thing, it has cameras and audio, it's on all the time, is it safe? if it falls over, is it gonna crush my dog or hurt someone or smash something? Even just like doing the dishes, we've seen some incredible demos of humanoid robots doing the dishes, but you have to imagine that every once in a while it's gonna break a dish. If it's breaking dishes at 10 times the rate of humans, like it needs to be superhuman at not breaking dishes because if it smashes a wine glass while it's doing the dishes, that's, and can I clean that up?

36:13Is it gonna be able to do that on day one? One, there will be a slow ramp of people feeling like, okay, it's good enough. I'm getting a lot of value. Obviously, there'll be a lot of novelty. There's already a lot of novelty. The Optimus is deployed in most of the Tesla showrooms. Some breaking news from Reuters 21 minutes ago. Exclusive Musk's XAI and merger talks with XAI ahead of planned IPO. SpaceX and XAI? SpaceX and XAI ahead of planned IPO. Okay. So this was something that we obviously were talking about. predicting months ago at this point. So no huge surprise here. This always felt like it made sense.

36:53I'll read through the article. I don't know how much context it actually has. So they're in discussions ahead of a blockbuster IPO planned for later this year. The combination would bring Musk's rockets, Starlink satellites, and X social media platform and the Grok AI chatbot under one roof. Imagine owning X, the internet's dive bar, and space. in one ticker. I mean, the company's launched a couple years apart. I think 2007 and 2005 or something. Flashing back to 2007, 2010, I mean, yeah, Twitter and that space company that hasn't successfully launched anything, they're going to be part of the same company one day.

37:35That is a wild future. Yeah, I am curious to see if they end up at some point just spinning X, the social platform, out again. Does it really need to live? I think Musk holding companies just gets bigger and bigger and bigger. And it all goes together into one because there's a lot of efficiencies there. Sean Puri from My First Million had a post about this, how he thinks Elon should IPO his personal holding company. So you get stakes in everything that he has stakes in. And he was proposing it like a Berkshire-type structure. But instead of Berkshire Hathaway, it would be like Musk Holdings or something, or Musk's initials.

38:16I think a lot of people would be buyers of that. But it'll be interesting to see the S1s getting more complicated by the day as the investment banks prepare for the June IPO for SpaceX now. Is June the birthday? That's the target. But it's late in June. It's June 29th or 19th or something. Yeah. Yeah. So, yeah, we'll see. I mean, expected this to happen. I think it builds a, you know, again, some people will be frustrated with the narrative, the data centers in space narrative. But we saw this sort of like sort of organized narrative shift around SpaceX being the data centers in space play. Yeah, that was the bridge.

38:58Like without that, it didn't make any sense. And then once if you can get behind, okay, data centers in space is maybe possible, maybe. Maybe you want some on land too. Then it starts to make sense that the merger fits a little bit more. The other interesting data centers in space thing, XAI, SpaceX thing, I just, I don't know. There is a fair, like, odd history of telecom companies owning media companies. So Comcast, NBC, Universal, right? Comcast was the art of that. Wow. History. Yeah. Rhyming. And so there is this world where you have the pipes and then you need something to push through the pipes and so you own a media company that pushes content through that pipe and it sort of rhymes, right?

39:55It's like you have Starlink, internet connections, and then you need something to go over those internet connections. So X, the social network, pipes over those. it's, if you squint, it's not the craziest thing. The other interesting thing that I want to do, or we should talk to some of the folks who have done some of this data center and space analysis is how powerful are the Starlink satellites right now? Like they have some onboard compute. They don't have, you know, NVIDIA GPUs. They don't have whole racks in space, but they probably have some compute just to run the network. And I'm wondering, like, in terms of energy draw, are they one order of magnitude off, two orders of magnitude off?

40:37Like how underpowered are the current Starlink satellites? Because that could be an indicator of, okay, well, they need to scale them up by this much. They need to add this capability. They need to do X, Y, or Z. Really quickly, 11 labs. Build intelligent, real-time conversational agents. Reimagine human technology interaction with 11 labs. Speaking of 11 labs, 11 labs is the new sponsor of Audi F1. Yes. John, you sent me a picture the other day of Audi out, I think, testing. And you were like, it's insane. They don't have an 11 Labs logo on there. Exactly. The sponsors were looking pretty sparse, but I think they're just adding them kind of in real time.

41:18Because it's fun to roll them out. Super, super exciting and exciting. I love the new Audi livery. It looks very unique. MKBHD responded to the news that Tesla is discontinuing the Model S and Model X. and said, oh, Roadster is so cooked. Elon just responded a little bit ago, said new Roadster will be incredible. And MKBHD is in the process of getting community noted. Elon said on the earnings call they are aiming to unveil in April and production will commence in 12 to 18 months. The shareholder deck notes the Roadster is in design development. Lars, VP of Vehicle Engineering, said the Roadster was definitely in development.

41:57So it will be pretty funny to be in like, you know, something that hopefully will look like a hype look and feel like a hypercar. Yes. But then you're just self-driving in traffic. It's like effectively like depending on like pricing, it's not going to be like price. I think I'm hoping it looks like a hypercar, but prices like, you know, a Turbo S or something like that. Yeah, I think the secret to success is probably$200 ,000 to$300 ,000, but it looks like a cyber truck Huracan, like low to the ground, super insane performance, self-driving, but it has entirely new aesthetics that turn heads.

42:42The cyber truck is kind of bad. What was he saying on Joe Rogan? When he was talking, he was like, wasn't he alluding to the roadster potentially being able to take flight? Yes. Of some sort? That's exactly it. Yes. And we were debating with Doug G. Murrow from Cars and Bids and his own YouTube channel, what does the definition of fly mean? Like, we've seen the Xiaomi car jump. It can jump over a pothole. It can jump a couple inches off. There's that Mercedes-Maybach GLS that can bounce. So what does fly really mean? fly a foot, fly 10 feet. I don't think anyone's expecting that in the next year, it will just actually take off and fly you from LA to San Francisco or something.

43:26That would be never bet against sea lions. I mean, I would want that so badly, but there are a lot of other cool things that we could do. I think the one that I, it wasn't the one that I predicted, like basically it, you'll be able to pull up to a parking spot and it will be able to use like fans or something like that to lift off the ground and slide into a parking spot. It'll have some gimmicky element. It'll shoot the battery out so hard that it sends the car flying. Shoots the battery down, which pushes the car up into the air, and then there's an ejector seat. You will be flying. The car will not be flying.

44:03Who knows? Insane. Hopefully, it's available on Shopify. Shopify is the commerce platform that grows with your business and lets you sell in seconds, online, in-store, on mobile, on social, on marketplaces, and now with AI. Rounding out. Sorry, really quickly, Tyler. I mean, this is about the question of, like, can you run GPUs on Starlink? Yes. So, like, a current satellite, if you're looking at the V2 Mini satellite, the peak power draw is, like, around, like, 3 ,000 watts. Okay. So, if you're running an H100, right? So, this is, I mean, maybe a couple years old. Yeah. It's only, like, 700. So, you could actually put a few H100s on a Starlink right now.

44:38Wait, wait, wait. Sorry, sorry. 300 watts currently, and an H100 is... 3 ,000. 3 ,000. Oh, okay. Yeah, you could put a couple H100s in theory, but you wouldn't be able to do anything else. Yeah, I mean, like three H100s is not useful really at all for serving any big model. Yeah, but we're not four orders magnitude off from doing something. I mean, you can do inference on just a laptop, right? And that doesn't have the power draw anywhere near an H100 rack. Granted, it's going to be slow. It's not going to be functional. But we are in the ballpark. Is somebody just going to put, somebody should put a Mac Mini on a weather balloon?

45:14The first... Just send it. You really could. First space data center. Have you ever seen those trends of like, we sent X to space? It's like a proven viral format on YouTube. I think someone sent pizza to space. People send like a piano to space and it plays a song. Basically, YouTubers figured out that you could get a weather balloon that you could just buy for like, I don't know, not that much money and just release it. And it would just fly up, up, up, up, up. and then you would reach the sky and you would take pictures and time-lapse photos or video automatically. You can get a weather balloon, a 22-foot scientific weather balloon on eBay for 220 bucks.

45:52What should we send to space? It's kind of played out, but maybe... Yeah, garlic bread to space. Bobby, thank you. Yeah, the garlic bread went to space. I don't know why. I don't know why, but yeah, the sending multibot to space... on a... I also, I don't know if you can get Starlink working in space easily. I think, I mean, ideally, Tyler, what if we got a handful of weather balloons and we sent you up there with... And then I could pay it down like that Red Bull video. Yeah. Just one shot it. Just do it. Just one shot it. Last thing on Elon, looking at prediction market on Calci, when will Elon become a trillionaire?

46:34He's had a 65 % chance before 2027, just in time for the midterms. It's not like that will be used against him at all. There's still a chance that it takes the pressure off the billionaires because they're like, oh, there's a new thing we've got to focus on. No one's focused on the billionaires right now. All the billionaires start ganging up on Elon. They're like, hey, let's actually just do a trillionaire tax. Why are we focusing on billionaires? Trillionaires have so much more. Waste of time. Waste of time. Let's just narrow it down to trillionaires. Just the trillionaire tax. Anyway, console.

47:06Console builds AI agents that automate 70 % of ITHR and finance support, giving employees instant resolution for access requests and password resets. Where else do we want to go? Do we want to go more reactions to earnings? There's a whole bunch of other stuff in here. Yeah. Microsoft is on sale, according to Jay Gatsby, because Joe Weisenthal said, incredible day, according to Barclays Alexander Altman. Microsoft has lost$441 billion of market cap today, marking it the second largest drop ever since NVIDIA lost nearly$600 billion after DeepSeek. Wow. Yeah, it was the worst day for Microsoft since 2020, since like the COVID sell-off.

47:46Absolutely remarkable. But I mean, I don't fully get it. It seems like Microsoft is very well positioned. I mean, maybe they're facing the same like implementation question as Meta, but it seems like they have all the key ingredients. I mean, they certainly don't have the crazy team that Zuck just went and poached, but they got OpenAI. They have the partnership. And so they have access to the models in a way that Meta does not. And so Meta does need to build the team to build the competitive models. Yeah, worse sell-offs in Microsoft history, the crash of 87, then in 2000, April 24th, 15th. 40 % in one day in 87.

48:28That's brutal. We don't know how to create sell-offs like that anymore. Hopefully we don't. Famous last words. Just like everything candles down 40 % teach you a lesson. Yeah. Yeah. This is some interesting history here. Well, Microsoft is unfazed. When you look at it this way, it is truly the 15th worst sell-off in Microsoft history. I think they're going to get through it but Stan disagrees Stan says it's over thanks for playing to zero likes I'm going to like this good Stan I don't agree but very funny post Andrew Curran is sharing a post from the information Nvidia, Microsoft and Amazon are all ponying up 60 billion as much as 60 billion in open AI We don't know what kind of talks they are.

49:25Are they early? Medium. Medium. Late stage talks. Extreme. Advanced talks. Intense. Preliminary talks. There's lots of different talks. But this is on top of the$30 billion that SoftBank is in talks for, which means that the$100 billion target for the next round is already almost met. And, of course, this is going to go back to, is this circular, blah, blah, blah, blah. I don't know. No, it feels like the circularity narrative, we're just at a scale where if you want to raise$100 billion, who are you going to? Who would be okay? It's governments and the hyperscalers. There just aren't that many funds that are saying, yeah, I'd love to lead$100 billion round.

50:12I don't have the money. It's just impossible. They're tapped out. Yeah, all the traditional financial players are very much tapped out. Let's go to companymarketcap.com. While we pull that up, let me tell you about Figma. Figma Make isn't your average vibe coding tool. It lives in Figma, so outputs look good, feel real, and stay connected to how teams build, create code-backed prototypes. Okay, so at the$830 billion that this round is being discussed at, JP Morgan is worth slightly more at$832 billion. But then below that, OpenAI will be valued more than Samsung, Tencent, Visa, Exxon, Mobile, ASML, Johnson & Johnson, MasterCard, Costco.

51:03A lot of them. Yeah, you start being able to add up some of the biggest companies in the world and still not be worth more than. Zero Hedge had some extra context. Q3 2025, Meta crashes on surging CapEx forecast. Q4 2025, Meta soars on surging CapEx forecast. Let's go. Research and Invest pushed back, though. Said, no, it soars on growth, acceleration, guide. CapEx held it back or could have opened at around 880. And it's because of the profit. A lot of people are chiming in. So we'll talk to Eric. Buko has continuously had great calls on Meta. I remember very distinctly when he shared multiple times over a few-day period, Like Meta will start touching 600 and you need to develop the mental fortitude to buy, even though everything, even though everything in your mind will be telling you not to do it.

51:56Just hit the button. Suspected Cap says, I got to really respect Zuck willing to spend over 50 % of revenue next year when they still on CapEx, when they still haven't delivered a single compelling AI product. Hell yeah. But Pythia Cap chimes in and says, the ads are the compelling AI product. And this has been the under-discussed narrative with our CapEx. They do break it out. And for a long time, you know, 50 % of CapEx, more than 50 % of CapEx was going towards core AI. Just workloads for Instagram reels, recommendations, ad recommendations, running the core product. Different, I mean, there is a specific chip for YouTube.

52:35Like there's CapEx that goes into just running YouTube, just running Instagram. And so it's not all AI, but it'll be interesting to see how that shifts, how much of this is, okay, this is generative AI workloads going forward. Is it more than 50 % of this new boost in capital? Brother Joe Weisenthal shares one of the best headlines that I've ever seen, which is Blackstone nears deal to become New World's largest shareholder. Just in general? No. New World is a company. Oh, okay. Blackstone is in advance talks to become the single largest shareholder of New World Development Company, according to people familiar with the matter, a move that would see one of Hong Kong's richest families relinquish control of a major asset.

53:19Under the proposed deal, the U.S. company would be able to restructure the embattled developer. New World could continue to try to offload assets to shore up liquidity. The family of Hong Kong tycoon Henry Chung currently holds about a 45 % stake in New World. We need to bring the word tycoon to the West Coast. Sam Altman is an AI tycoon. Tycoon is good. We should do a list of the top tycoons. Jensen is a chip tycoon. Yeah. Tycoon's a good one. Satya is an enterprise tycoon. We had tycoons during the railroad barons. It turned into a bit of a pejorative, but I think we can turn it around. It's such a fun word.

54:00Why should it be negative? Yeah, it sounds like Yahoo. It feels like you're wearing a cowboy hat on a horse if you're a tycoon. That's right. You're running all over the economy. You're a tycoon. Cowboy hat on a horse. Yeah, you love it. Well, let me tell you about MongoDB. Choose a database built for flexibility and scale. With best-in-class embedding models and re-rankers, MongoDB has what you need to build what's next. We have to talk about Genie. The Genie is out of the lamp. Logan says, introducing Project Genie, a frontier world model product powered by Genie 3 and available to G1 Ultra users in the U.S.

54:36starting today. Are you a G1 Ultra user? We were playing around with this this morning. We were playing around. We were playing around with this this morning. It is absolutely wild. You can basically prompt an entire world. It instantly turns into effectively a simple video game. Yeah. And you can create some really funny scenarios. And. We will show you. They added the jump button. They added the jump button. You get to pick if it's third person, or I guess if you don't check that, it's first person. But sometimes even if you don't check that, you can still wind up in a third person game if it's obviously a third person request.

55:13They need to add the crouch button. But look at this dog. They need to add the crouch button. Crouch button next, and then the flashbang button probably. Whoa. Yeah, you're jumping. It's so fast. I mean, the previous Genie launch was still called Genie 3, right? Well, no, I mean, yes. This is not like a new product. This is just making it public. So I think it was in August when Genie 3 was originally released. But it was basically just the paper. There were some demos. But no one could actually use it. So, so cool. Yeah, I mean, it feels like more directable than VO3 in some ways. And it's certainly more stable as you move around.

55:51Well, it's just way cooler, too, because it's a world you can move around in. It's not like VO3 where you're just creating a video. Yeah, the memory is really good, too. Oh, and you can upload an image. And turn back. You can upload an image. That's, I mean, get ready to play dinosaurs with kids. Do you have the clip of us driving? So we got access. We generated some. Now it's in such high demand that you might not be able to generate these worlds for yourself immediately. There might be some rate limits going on. I'm sure the GPUs are on fire. It is going to be Genie 3 day on the timeline for sure.

56:25People are going to get crazy creative with this. Do you have John's first prompt? You can't access the videos? No. Oh, no, we didn't download them? No, because I think the site is being overloaded so much. Shame. Wow. Shame. Hey, Tyler, take some responsibility. Take some ownership. You're 21 years old now. Take some ownership. You could have downloaded the video. As the show goes on, I'll try to make a new one. Yeah. I mean, yeah, yeah. This is a good point by Noah in the chat. Wait, can we just take a GTA 6 leak and generate the game so we don't have to keep waiting? Pretty much. First, I mean, it's incredible that even a product at Google scale, they knew that there was going to be demand that they are seeing rate limits.

57:05That's wild and incredibly bullish for AI and shows that there's so much more demand and we need more chips and energy and data centers and GPUs, obviously. But on the flip side, we are going to move the goalposts. This is AGI, but it's not sufficient AGI because my definition is not just the jump button. I want mechanics. I want, we generated a video of my Bach driving on the Nurburgring. It was remarkably high fidelity. It was a little sluggish, but that might just be the driving dynamics. I think that was just the driver. Oh, you think it was the driver? I thought it was a lot of body roll.

57:40Tyler could not keep this thing on the road. There was just a body roll. I was like, just put it in a straight line, Tyler. Yes. But I want, I'm waiting, I'm moving the goalpost because I want Genie 3 or Genie 4 to be able to generate game mechanics. If I say I'm racing on the Nurburgring, I want a track timer. I want to be able to stop change my tires. I want to be able to get a refuel overtakes. I want overlays. I want boost pedals. I want DRS. I want shifting. I want the whole Forza simulation. The whole, I want, what's the one that people actually use for the simulators? I forget what it's called.

58:18Assetto Corsa. I want to be able to generate Assetto Corsa in two seconds. So mechanics are clearly next. This is obviously here. We can pull this up. So Tyler said six months. We'll see Over so pull up this video from you in six months. You'll have full games

58:36Move it move it move it

58:44There we go. Pull up this video from Ethan Mollick. He had early access to Genie 3 world modeling, huge leap forward in modeling physics, but some issues remain. Here is a bit of an otter airline pilot with a duck on its head walking through a Rothko-inspired airport in an otter in a wingsuit flying through a city of Gothic Tower. So this video is why we have$2 trillion of CapEx for AI. We just simply, before AI, we would need a team of advanced motion graphics artists to work for. You could probably vibe code something like this in Unreal Engine in a day if you were strong. John, don't try to pop the bubble.

59:31You could. I like the wingsuit, though. This is fun. In a gothic tower. It looks sort of like a Harry Potter world. Wow, it's really a full city of gothic towers. Yeah, and so the thing that's wild is that it takes 20 seconds to go from idea to this world. Yeah, super cool. Super, super cool. And you're just going to see this unlimited... People are going to go and just generate Mario, and you'll just be like, well, I could just download Mario. It's not... I'm okay with that. It's like when you go to Mid Journey and you say, make me a picture of a dog or Nano Banana, and it's just like, that's just a picture of a dog.

1:00:14You just find a picture of a dog. What's cool is when it's like your dog in your house doing the specific mechanic that you wanted, and it's a reenactment from a film that you're in love with, and you're a mechanic, and you're creating this unique thing, and you're mixing together these interesting ideas. We're going to see a ton of cool stuff like that. OK, so Tyler took full ownership, and he turned it around. I just got it back, yeah. I made a new video. While we pull that up, let me tell you about Plaid. Plaid powers the apps you use to spend, save, borrow, and invest, securely connecting bank accounts to move money, fight fraud, and improve lending.

1:00:45Now with AI. All right, look at this. Oh, yeah, this is a new one? Yeah, I just made this. The original was not two-tone. Yeah, this is a new. I just made this. Look at you barely keeping it on the road. It's really hard to stay on the road. Skill issue. So if you zoom in on this, the license plate does look a little AI-generated. There are some artifacts. but at this distance, this looks... Can he hit the apex on the next turn? This looks photoreal. Can he hit the apex? Can he hit the apex? Oh! The body roll. The body roll. You're actually going pretty fast. You're getting some speed on this thing.

1:01:21I think I fall off. I get off the floor. Oh, no! In the grass! Oh, no! Wait, what happened to the... You're done. Oh, no, you're destroying the side rail. How'd you get on the other side of the side rail? Ian says... Oh, no, you can just go through this? Yeah, crazy timing. Tyler turns 21 and he can't even keep a car. Wow. That was very, very cool. I don't see any happy dads over there. Dude looks in email. But it does, like, when it was working, so earlier, I think there were just too many people using it. But this took, like, maybe 15 seconds. That's remarkable. First it, like, makes an image and then you can edit it.

1:01:52And then from there you can make the actual world. Yeah, yeah, yeah. And it's, like, a minute long. Yeah. It's, like, yeah, incredible. Josh Woodward has another clip he shared. Nano Banana Pro. He's the VP at Google, Google Labs, Gemini AI Studio. Nano Banana Plus Project Genie, low poly cowboy dreams. They've been fulfilled. Let's take a look at what Josh Woodward over at Google built with Genie 3. So he takes the image, he's generated with Nano Banana Pro, drops it in, summarizes the environment, summarizes. And it's interesting seeing like, what does prompt engineering look like in this? in this, like how, what type of prompt do you want to put in?

1:02:35Because I think we just put in like two words. We put in like Nürburgring, track Germany. What happens if you add a little bit more there? How far can you push this current state of the art? The horse can jump. AGI achieved. AGI achieved. Do you think this is bullish for platforms like Roblox and Fortnite that have the existing network and they can integrate world models so that the players that are already a part of these ecosystems and these economies can generate new worlds quickly, generate new games, new characters, et cetera? Or is it as these world models get better, do they become a bigger threat?

1:03:12Because anybody can just... I'm sure there's infrastructure providers that can say, like, yeah, we're going to handle everything from account creation to in-game currency to things like that. Yeah, I mean, definitely competitive in the long term. in the medium term, like super good for prototyping and communication. And this is a key flow to, okay, you have an idea and you don't just want to, you know, generate a basic image of the game that you're trying to build. You generate a demo, a prototype, and then you go from here into, okay, let's wire it up in Unreal Engine or Roblox or Minecraft or whatever we want to do.

1:03:49And then you have the full game. I think Roblox and Fortnite will prove that they have real network effects. Yeah. And it's going to still make sense to create new games within these existing ecosystems. Yeah, yeah. But it is a very different architecture if you... But yeah, I don't know. I don't know how it would interact. Like if you're in Roblox and then you want to go into a fully generated experience, like the persistence doesn't exist. You're not in necessarily the same world. Just building like multiplayer capabilities in here seems very difficult. That seems like a real research challenge.

1:04:22Yeah, I think broadly, like the world model, like world labs, seems much more easy to integrate, at least in the short term, to something like Roblox. Because I mean, this is literally just like generating frames on the fly. You're not actually making a, you know, 3D like rendering. But it seems like it would be useful for training data as well. Yeah, definitely. Lots of opportunities there. Well, speaking of training data, let me tell you about LabelBox. RL environments, voice, robotics, evals, and expert human data. LabelBox is the data factory behind the world's leading AI labs. Well said, John.

1:04:55There are a lot of those. Google DeepMind created this short film. AI is going to disrupt Hollywood sooner than most might expect. It's their short film, Dear Upstairs Neighbor. It's previewing at Sundance Festival. It's a story about noisy neighbors, but behind the scenes, it's about solving a huge challenge in generative AI control. Developed by Pixar alumni, an Academy Award winner, researchers and engineers, here's how it came together. says DeepMind. And there's a community note on here. Let's see what they said. The quoted video explains that the short film was driven through human-made art with AI assisting and speeding up the process.

1:05:34OP is engaging. Poor Chubby, always getting community noted. We've seen a number of these. I think that's like, at a certain point, some people assume that things are happening. But you know, the point still holds that, you know, this is disruptive. Who knows if it's completely disrupting. There's certainly, I mean there's demand for movies that are shot on film still, so how quickly will all this roll out? But if you have a vision these days for an animated movie, you should just go try and make it at least. You have to imagine that even if you want to use a more traditional process and go through the traditional Hollywood pipeline, showing up to a pitch meeting at an agency with a pretty much polished AI version of your film is going to resonate in a way that a script might just get sent back in the mailroom.

1:06:27Yeah. So I don't know. I could imagine this in like the prototyping, the storyboarding phase really, really taking off. Staying in Google land. Please. Addy Osmani over at Google Cloud shared some big changes to Gemini in Chrome, agentic browsing with auto browse, Nana Banana, and more. Let's pull up this video. You can see it here. It's a huge day for tech news today. We got so much earnings. I mean, all week. Yeah, all week. All week there's been a lot of stuff. But the other stuff was like plant. The CloudBot stuff earlier was not. Is there audio on here? Can we play this audio as well? Let's see.

1:07:11Okay. Let's see. This is Gemini in Chrome, agentic browsing with auto-browse, Nano Banana and more. Does it work? Let's see. New state-of-the-art model for in-context image transformation. And traditionally, if you wanted to see how furniture would look in a room, you'd have to download a photo, upload it to an editor, and hope for the best. Here with Nano Banana, you just point Gemini to an image already on your screen. Oh, Tyler, you don't want AI in every feature? You actually like downloading the images. and round-tripping them. That's your preferred workflow. And every consumer is just like you, right, Tyler?

1:07:49Right? Stunned in the silence. Hit it with the flashbang. Oh, no. Hit it up. Going flashbang. Flashbang. Surprised? There's now big changes to Gemini in Chrome. We got flashing lights over here now. Okay, but this is still like making the product from a very AI-first view. It's not just taking the normal thing and then just adding one extra AI button. I mean, I'm not a product manager at Meta, but you have to imagine that there's little features like this that can seep their way into Facebook and Instagram where you see a photo of a restaurant. And you're like, I think that'd be great for a team offsite.

1:08:29Let me just not download the photo and put me, you, and Jordy at the dinner table at the restaurant, you know, envisioning what we're like. I just hit share and then I say, hey, put the group chat that we're in on Instagram DMs in this photo. That'll be funny. It'll be more inspiring for them to be like, yeah, we should go to dinner there, right? That's like a fun, delightful thing. The feature in the video that actually got shown, I wonder if that should actually live. So in that example, you're looking at an apartment online and you're in your browser being like, make it look like Kelly Wurstler styled it.

1:09:07and it adds a bunch of furniture, should that live at the browser level or should it just live in Zillow or Redfin or Compass, right? It's kind of a question on where this is. With the OS layer, I know what you're going to say. You're like the OS layer. You're OS pilled now, right? No, I mean, in this case, I feel like it should be like actually in Redfin and you should be able to cycle through a bunch of different interior design. We have seen that every single layer of the stack is adding AI features from top to bottom. Interesting context here from Compound248. Google with an absolutely murderous response to OpenAI's Atlas browser.

1:09:45Just killed Atlas. Highly strategic for Google. Launching a browser was a mistake by Sama and the OpenAI team. OpenAI was never going to gain big browser share, but launching gave Google the needed cover to launch its Chrome AI embedding without violating antitrust because now it's a competitive response. Would they have had? I don't know. I can't. It's hard for me to believe that Google wouldn't be allowed to add AI features. I don't necessarily buy that. But it's an interesting take. And, you know, it's one position. Google is using its browser incumbency as a distribution and learning angle for AI.

1:10:18It's going to be exceedingly powerful. If you allow it, the browser is going to learn from everything you do online, creating differentiation for its position as a personal AI. Wow, big day today. We're not getting any fines from the chat because we're both suited up. Yes, no fines today. It's been a minute. I like that. Thanks for holding us accountable. Turbo Puffer. Surve release vector in full text surge. Built from first principles and object storage. Fast, 10x cheaper, and extremely scalable. There's so much new. TikTok uninstalls surge 150 % after apps US takeover. That is a crazy surge.

1:10:54Okay, yeah. So there's a new king of the app store. It's called Upscrolled. Yes. It is a TikTok Instagram clone? Clone? Okay. Competitor. Just getting off the ground. But I guess, yeah, people, I think people had the perception that TikTok was immediately censoring a bunch of different topics. Yeah, yeah. Political topics. And then just decide, upscroll, like use that as an opportunity to say like, hey, we're the alternative. Yeah. Yeah. It was interesting because I know people were tracking the TikTok changing ownership. Is TikTok going to get banned? There were a lot of TikTok creators that took that as an opportunity to diversify to Reels and Shorts.

1:11:36And it just became obvious that you should be a multi-platform creator around that time. But I wasn't aware that the TikTok community was going to be tracking when the servers actually shifted over to Oracle. It feels a little wonky and not something that would go super viral. Yeah, but people noticed because videos stopped being served. Yeah, yeah, exactly. So there was an outage, and that certainly drove deletions. And Sean highlighted something. Yeah, but again, to be clear, it's like there is a base level of TikTok uninstalls, and then that surged 150%. That doesn't mean that they're declining by 50 % or anything like that.

1:12:16There's still new installs happening. Calling up scrolled. Yes. The rumble of TikTok. Really? The rumble of TikTok? Sean Frank says, TikTok views are down. People are blaming the new owners. I think this is just proof that TikTok was botting views the whole time. Your 100 ,000 view video is probably reaching 25 ,000 real people. So no surprise here for me. I always felt like it was always obvious that there were very real people on TikTok. I know people that whenever to TikTok. Of course. They'd start making videos about startups. They'd start getting real inbound from people on LinkedIn. Yeah, totally.

1:12:52So very clearly, it was always a bunch of real people there. But TikTok had every incentive to just bought all the views because what happens if somebody's getting way more views on TikTok versus Instagram? They're going to lean in. They're going to say, like, I have more followers on TikTok. I should be creating content there. And that created a flywheel. And so you can imagine as things shifted over, who knows, right? Like the new, basically the new product. Yeah. I mean, they had some system that was. I like different formats. I liked Vine back in the day. At one point I did set up a TikTok and I uploaded like two or three videos.

1:13:30I was just trying to see like what it felt like to use that platform. And I noticed even though I came to the platform with zero followers, the three or two or three videos that I uploaded immediately got 500 views each. and I thought that the model was you get more of an opportunity to like sort of audition your content in the algorithm and then if it works it can blow up very quickly and I think that that's somewhat true like when I started my YouTube channel the first videos that I put up got a hundred views and for like a year if I broke a thousand views a video I was like this is amazing like crazy you're really grinding it really right yeah um but on TikTok you you post and you immediately get 500.

1:14:11And I've talked to some folks years ago who would set up a new TikTok account for a brand and they would launch one video that was so polished and so designed to go viral. Like they'd blow up a car and they'd spent all this money shooting this. And it would actually just, they knew that it would go viral and it just immediately go out, even though it's a fresh account and there were no followers because they just knew it was good content. It would get shared. TikTok would audition it to like a hundred people. Yeah. I remember when TikTok launched, it was a period where it was so difficult to grow on Instagram.

1:14:42Like, there was a huge challenge. If you're a new creator, you go on Instagram and be really frustrated because your stuff just wasn't getting shared with people that didn't already follow you. Totally. There's some comments under here. There's the last thing on the TikTok front. Turner Novak commented, maybe they were views from Chinese users, which are gone now. It also could be international users. Remember, there's like, if you have a new U.S. app under U.S. ownership, Is it getting shared with international users that are using other versions of TikTok? Unclear. Well, let's bring in our first guest of the show, Anton from Lovable.

1:15:17While he comes on, I'm going to tell you about Gusto, the unified platform for payroll, benefits, and HR built to evolve with modern, small, and medium-sized businesses. Welcome back to the show. Welcome to the TBP and Ultradome. Thanks for taking the time to come and hang out with us. West Coast tour. It's cool to be here in person. Thank you. It's been more than six months, but it feels like much more shit ton has changed. On my side, the business is doing better than ever. I can imagine. Every time I see a post about you, from you, there's a new biggest number. How is growth going? Is it still accelerating?

1:15:51How's the business doing? We are doing great on the growth side. We hit 300 million AR two months after our 200th month.

1:16:04The dog is even louder in person. But more interestingly to me is the builders are doing real things. I was in the airport from San Francisco here, and Adam at owner.com, who helps tens of thousands of restaurants, he was super excited and raving about he had built out a new product line over the weekend in eight hours, where he was solving a new problem, where all the customers were saying, we keep getting these phone calls, it's not always someone picking up, and he built an AI who answers the phone for the restaurants. And it was all working. You could configure it just like you were training a human.

1:16:40And he was now releasing it next with his team. And we're seeing all of these new opportunities where people who use Lovable as their technical co-founder build businesses. And maybe you saw, I was super shocked when someone was shipping AI-generated dog pictures in frames to pet owners. and they were making$300 ,000 per month on building that out without any technicalism. How are they actually doing that? Obviously, I think maybe you can describe the technical co-founder process of building a new application that someone takes payment, but then I want to know about the top of funnel. Yeah, but part of, I mean, I always saw Lovable's growth as millions of people out in the world that historically we're just perpetually searching for a technical co-founder.

1:17:33Problem is a lot of people that are technical have a bunch of great ideas. They don't necessarily need an idea guy. And so there's all this like sort of pent up creative entrepreneurial energy that just never really goes anywhere because somebody doesn't take the time to actually learn to code. They never find that right partner. Yeah, that's what we're seeing. And our mission is about human creativity, which is very fun to empower. But it's not just new businesses. there's a lot of companies and I keep hearing from how they build out AI applications and agents using Lovable and once you get into it especially if you look back compared to six months ago this feels like to me when I use it there's no limit almost of what you can do and the thing where Lovable what I'm hearing is a bit unique is that there are a lot of tools that are coming from developers and more people keep using them.

1:18:26We started with the non-technical people and that makes it just super simple but it still has the same capabilities that more sophisticated users are looking for. How are you thinking about working with companies like Owner that I'm not super familiar with Owner, we've got to have Adam, the founder on, but my understanding it's somewhat of like a system of record for a restaurant owner, is that right? And so in theory he could also offer Lovable as like an integration so that individual businesses that are using Owner can expand and just build products that they themselves want, not necessarily have to rely on Owner.

1:19:01Is that right? Or are you seeing opportunities like that with other companies? I think we have these partnership programs, and that's a good idea. I'm going to bring that back to Tim and talk to Adam specifically. But what we're seeing is - Theoretically, somebody is on Owner. There's a feature that they want that's not being offered, and they can just build it. They don't even have to request a feature. I mean, that's what the future looks like. And what we've seen is that Lovable is first used as a communication medium. And there are a lot of people that have stopped using Google Slides and PowerPoint and now they just prompt it away because it looks so nice.

1:19:40And I think it's a better medium than the animated videos you were talking about previously. But then now a lot of companies, and us is one of those, we're switching out SaaS providers to using tools that we build ourselves. And we tell Lovable, can you connect these two different applications as internal tools that we built and add AI in between of those. And that, I think, is more of the future of how companies are going to be run. Okay, let's talk about kind of vibe coding debt and tech debt, because we've gone through this where we'll build a product. we built a guest directory, a very simple product that would basically, every time an episode would get published, we had an app that would effectively scrape the episode, figure out who was the guest, link everything out and publish it.

1:20:30And it was built in a day by one of our interns last summer. And then he had to spend the entire summer just maintaining it and shipping incremental updates. So are you seeing any changes on that front? Obviously, if it's easier to make products, Maybe it's easier to maintain them. But I think the concern is if you've created 200 different SaaS tools and internal tools as part of your organization, then you end up spending really valuable resources at the company, human labor time, just kind of maintaining these systems and making sure they keep running. Can I talk a bit about the recent updates we did yesterday at Lovable?

1:21:14So there's a much more advanced planning mode that helps asking you or your intern questions about what it is that you're trying to achieve. And that makes the AI be able to find a better solution that doesn't need that type of maintenance. And that's one of the many improvements that we shipped yesterday. Another big one is... So basically, if you vibe code poorly or if you prompt poorly, you're adding a bunch of vibe coding debt. if you spend a little bit more time prompting. Yeah, I think people should just move fast and not be like, oh, I have to think through this so it's maintainable. They should move really fast to get something that works and that's useful.

1:21:55But then you should sit down and you should reconsider talking to Lovable and asking, should I restart from the beginning? I'm having these problems with the maintenance. Should I just be keeping incremental updates or is there something else that could actually solve this on a deeper level and keep having that conversation and be creative in terms of what could be the right solution for this. Because the systems are extremely intelligent now, and they're just getting more and more intelligent. So that should be your status quo. Explain your situation, which the AI doesn't know, and then it will help guide you through what's the best path for you.

1:22:30Yeah, it feels like the solution to vibe coding is more vibe coding. Or more code, right? But the question... He says the vibe coding dealer. Yeah, he's like, actually, you need more. But I believe that. I believe that. But I think the interesting question is the shift to mobile. And I want to know how you're thinking about that transition. Because if you go and Vibecode an application and you sit down, you really think about it, you work with the tool to plan and test. And you're giving feedback. And you spend a full day or a couple hours and you got it in a good spot. But then there's like that one little, oh, actually this button isn't quite working.

1:23:05Can you just go check out? It doesn't work in this scenario. That winds up just being normally like you text a developer, you Slack them. How are you thinking about long-term integration with end users who might not be jumping into the tool themselves and might not even have the time to actually sit down and vibe code? I think the future of how teams operate is, of course, changing. I think there should be someone who is ultimately responsible for the quality of the application. that might not be you even though you can throw in ideas of changes and then someone looks at it before it goes out to your customers.

1:23:43So that's a high level I think about it. There's a lot of new capabilities that we are looking at to make sure that quality is always maintained and we over the last nine months we've been super focused on security which is this like if you're putting something in production that should be your first your first priority and and there's a lot built in that makes applications secure from the ground up in how we approach it. Yeah, the challenge right now is if you have a hit product, you could go to 100 million users in 48 hours. We saw this. What was the company that was like Palantir for dating?

1:24:19Did they really go that big? No, they went to the T-Dating app. Oh, yeah. They don't call it Palantir for dating. But yeah, the T-Dating app really would scale. They have a security issue. They didn't use Lovable. Yes, yes. But yeah, the founder was just kind of coding. I think he had some team members too. Yeah, sure. But clearly they were moving very quickly and some mistakes were made. Yeah. Has anything changed in your mindset about the level that you want to operate at or integrate with versus being a web app with cloud hosting, operating into the browser level, into the OS level, launching a dedicated app on a phone or on a Mac or command line tools?

1:25:10How are you thinking about the different unlocks that you get at different levels? Yeah, great question. So first of all, I use Lovable on the phone all the time, and it's really like a good mobile experience. That's why we are seeing usage there. I know that a lot of entrepreneurs, they're building out complete work OS systems. I talked to Gwyneth Paltrow yesterday, and they're building a lovable brain that accumulates all the information that they need in running their company. And what that gets some more capabilities from is that it connects to your local file system. And it connects to, in the future, I don't know exactly what the mobile device is going to look like.

1:25:55but it's going to the AI has to have context on everything you do on your phone for it to be fully unlocked, all the capabilities unlocked and that's something we're looking at, exactly how does that future look like as we're building towards the best interface for humans to use technology and use AI, because that's the vision we're on How do you think about the trade-offs between consumer and enterprise obviously you can use it to make something that replaces a slide deck, just communication, external marketing materials, landing pages. You can also use it for building an internal tool and just spin something up internally to a company that's never going outside.

1:26:36Both are very interesting markets. Do you want to serve both? Do you think that there's a value to focusing on one over the other? Great question. So Lovable started out from the early adopters and that's where we're seeing now growth in all directions because people love how there's maybe some Swedish design sensibility like things just works and then we put a lot of hard engineering making making it simple right and one of the directions is spreading in the is in the enterprise people come to the work and they show like look how much we can get done using lovable at work so now we have all of these required features for enterprises, SCIM, and so on.

1:27:17And specifically, I'll tell you an example of a really large company. They have 80 ,000 plus real estate agents globally, dozens of countries, hundreds of websites. They had the offer to re-platform all these websites because there's always this pain for marketers changing websites. And the VP of marketing there, that would take a year. The marketing found lovable, and he was like, wow, I can just build one of those websites in a few minutes. And then they sat down and they looked at how can we reach that. These are websites for individual homes? For different brands. Brands for real estate agents across different geos.

1:27:55And then over three weeks, they replatformed, and they saved$2 million on a solution, which was part paying for AI chatbots on the website. And their chief innovation officer just says, this is the biggest change that the company has experienced in how fast they can move, how they could build out an AI chatbot just by prompting Lavable. And that's a large company. And that's them building product lines that are facing their end customers. What they're seeing even more volume of is, of course, internal applications. And applicant tracking systems built from the ground up by the people who are using those applicant tracking systems with AI.

1:28:35with thousands of people being served. How are you thinking about headcount planning, specifically on the engineering side? Yes, it's a good question. I was at the Anthropic office, and I think they're hiring a lot of people just like we are doing. Because what you're actually seeing is that if you use AI correctly as a business, which is one of my personal top goals, or the entire company's top goal out of three goals, is us learning how to use AI as productively as possible. And that means that each human has more output, right? If you do that really well. And as we are learning that and figuring that out, we're putting that into the product and giving our users all the best practices in how to connect all the internal tools that your company is running on and share context across everything you're doing.

1:29:26Like when you're doing research on a podcast, you should all be able to just ask an AI, what question should I ask Anton? And all of that infrastructure, all of that tooling, you should be able to build on Lovable or just get someone else's tool and copy it into your workspace. How much do you guys pay attention to job descriptions at various companies in terms of understanding market pull? I could imagine people, companies that wouldn't necessarily hire software engineers saying like, we want engineers that can use Lovable and other relevant tools. Because I think one of the interesting things that we're trying to understand from just kind of understanding like how we'll see job growth in some areas, maybe job reduction in other areas is I think people are underestimating how many companies there will just be a net new role where somebody or multiple people are creating and maintaining software that the company is creating.

1:30:21And we're an example of that, right? Historically, a media company, like if you had a fledgling media company, we brought Tyler on last, I think like Q1 of last year, we'd only been in market for a handful of months. And normally, if somebody was building a media company, and they were telling me they were hiring, or a podcast, right, and they were telling me they were hiring a software engineer in their second quarter in business, I'd be like, dude, you should focus on like a million other things, right? Just make good content. But in our case, we realized, hey, we can build quite a lot of internal tooling for what we're doing to make the show better.

1:30:55And so I think we're going to see a lot of job growth from companies that, again, wouldn't normally hire anybody internally doing software engineering. It's a good question. I don't look at the external other people's job offers. My background is in physics. So I just break things down into like, what is it that, what are the governing principles for making a team work really well and people work, humans working well together and getting output as a company. And what I'm seeing is that you want the team of people who, they don't have to be software engineers, but they're very curious and they get it, they get new things, understand them very quickly.

1:31:36And that's one of the things that we're fundamentally um fundamentally hiring for i mean i i can take another example because i love i'm so inspired every time i meet someone who's has like we've changed their lives with lovable so it's a it's a guy who alan he built a healthcare ai staffing company in five months there is a million dollars in error and he couldn't have been able to build something like this and then yeah there's so many niche labor marketplaces uh these were they used to be like more popular like venture backed businesses and then a lot of vcs figured out like hey you can build a great business here but you end up kind of capping out there's some software component to do with like matching and kind of booking payments stuff like that but ultimately a lot of these businesses should just remain like somewhat niche right you could have a 10 million dollar a year business doing staffing and have it you know like the people running it right you have a lean team.

1:32:32But now, but historically it was a challenge because there was a number of companies that would build like out of the box, like marketplace software. But usually they were like, it was, you had to do so much work to like actually adapt the software that it was kind of this trade-off of like, do I build it in-house? Do I use some - People used to abuse WordPress like crazy. They'd build a whole social network on WordPress or try and modify it with e-commerce stuff. And, And it would take a year and millions of dollars to build something that now it takes a weekend. How do you lead the team around dealing with competition?

1:33:08And, you know, you guys are now competing with pretty much every company in the whole world, it seems like, you know, from hyperscalers, right, that are building vibe coding tools to other startups. Like, what's your philosophy around dealing with competition? just kind of like emotionally in the organization? First of all, what we're seeing is that people who come back to Lovable and compare it with other tools, they say like, wow, this is such a wonderful, simpler experience that works better for them. It's more capable in many, many dimensions. So that just gives us a lot of belief in what we're doing.

1:33:49and the way we think about it is to not look at what others are doing. It's just to look at what do our customers want us to do and being very grounded in that. Have you banned the competition Slack channel? Because it would literally be every day. It's like, hey, we have a new venture backed. But it's a sign that... We fundamentally say we're building the best product based on first principles of what we think is the best way to do these things. And it often means not adding new features, adding new capabilities, but thinking very long-term, how is this whole experience going to be for us humans as we interact with superintelligence, basically, in the future?

1:34:31And that's what we're driving us. Building that product is the motivator for everyone. What about international expansion? You're obviously in Europe, here already. Are you opening offices in other continents? Yeah, we haven't announced more offices than Stockholm and then a great go-to-market team. Have any to announce? What's that? I can't come back. We have more announcements. But we have people hired, a few people are hired remotely, including here in the US in various cities. Yeah. So that's what it's like. But we're getting a lot of value of being in person, people who are very long-term thinking, very, very bought into the mission that we're on based in Stockholm.

1:35:12How do you think about retention? There's so many amazing tools that come out. I remember those, it was Lenza Magic Avatars. Everyone had to take their photo and do the Studio Ghibli precursor a year earlier, the style transfer on their image. And then people sort of like, they tried it and then they churned out. But at the same time, website builders have incredibly low churn because once you build your website, even if you're not using the tool every day, you're using it as hosting. and you might be jumping back in to make changes. How are you thinking about the different retention dynamics, the different cohorts?

1:35:48How are things looking? We're seeing very, very healthy retention. We're like, oh, net dollar retention has been more than 100%. There we go. But we're also, of course, seeing some AI tourists that are just trying a lot. Yeah, yeah. They must exist and they just stop by and then they move on to something else. Yeah, and what we're doing is that we're splitting out the different segments and seeing what are the jobs to be done for the segments that we could do better. And fundamentally, what we're noticing is that for most things we're adding, which is about making the whole experience to do more things, more seamless, like more capabilities, more seamless without making it a more complex experience.

1:36:32That's helping the retention across the board. for everyone. And less of a point solution, less of, yeah, I use that for slides this week, but then there's a new one over there. I got to try the new thing more of like actually run your entire business, build a new business on this, and then stay with that for a long time. That makes a ton of sense. What about recommendations for other software products, databases? I've seen a bunch of charts where the default recommendation for Superbase, for example, is just climbing like crazy because it's recommended by you and by a backend and by a number of the models.

1:37:10Does that business evolve into an affiliate model? Do you have demand from your customers to educate them about the different trade-offs when they're building, when they're picking something? Or do you want all of that to be abstracted away so that the end user doesn't even know what a database is, for example? And database is just one example. There's a million things that you probably plug in with right this is a great question um we have some really good product integrations and you mentioned mentioned super base it's one of them yeah and uh we are recovering more and more i have payments email and communications we want those we want more of those amazing partnerships yeah um i i think uh like there shouldn't be any limits of those integrations you should be able to ask lovable to i mean get cleaning for your podcast studio or whatever.

1:37:56And that shouldn't be done by us. It should be a partnership where we're currently just making more of those partnerships successful. And there are multiple companies that have been seen absolute majority of their growth coming from us actually. Sure. And then, but then at some point, we need to let our users get the best product integration if there are many ones. I feel like other companies should be a little bit worried if the majority of their growth is coming from you guys, given that the whole purpose of the company is to make it easy to build software, and eventually you guys will just naturally do some of those things.

1:38:36I mean, the integrations, I'm happy to not do them. We want to focus on the interface, the app creation layer, and then underneath there needs to be a lot of things that connect to very technically challenging systems to build the infrastructure and so on that we don't need to put our efforts into building. So we want to do a lot more partnership this year. Yeah, makes sense. Talk about the dynamics between Lovable and all the different labs. I'm sure that you have very open dialogue with them around just integrating with new tools, getting previews of models, all that kind of thing. And I'm sure part of why you're on the West Coast is just to spend time with the different teams.

1:39:17Yeah, those relationships are really good. we are fundamentally listening to the users more than them. We're building for the 99 % while they're building developers. They're like, please, listen to your users less. You really want to tell me. No, I'm kidding. Yeah, no.

1:39:38And they have to spend so much of their focus on the strategy on building these models and squeezing out more and more juice from those models. and we're in this place which is very favorable for the end users where we're not tied to a specific model we use a combination at Lavable of different models and that gives a better user experience in the end with the trade of speed and the height quality for each specific task How did you and the team react to CloudBot was there any kind of like new kind of user paradigms that you were inspired by anything to take away and kind of integrate. I mean, we had Peter on the show Tuesday, a couple days ago, and he was very open.

1:40:20He's just like in it. He's clearly not in it to make money. He's in it for the love of the game. And just kind of, we asked him, do you think that people will clone what you're doing or copy it or build on top of it? And he was like, yeah, I do. It's cool. So kind of an unexpected answer, but I'm curious if there's anything that you thought was particularly interesting that you can bring back to Lovable. Yes. I love Peter. I'm happy you had him on the show. I think me and many people in the team have been building our own versions of this personal assistant that you just talk to, record audio to, and...

1:41:00Talk on your phone. Yeah, in my case, on my computer. And then what we're, of course, thinking about, which is like the other top goal for this year, is to provide the best workspace or the best way to collaborate as a team. And that, of course, a big part of that is being able to talk to an agent that has access to all of your different tools that you want to build in with Lovable and can pull out the data when you need it. And I think I'm very happy about this open source project in particular getting a lot of traction. It's a bit of my roots as well. Yeah, it feels like it's just waking everyone up to what's possible.

1:41:41It was real like feeling the AGI moment generally and maybe not everyone reaches for open source and all that's entailed with that but it's sort of just like a new call to action for everyone to try new tools. So yeah, overall good, very bullish. Twitter likes this, say completely new things that you can try out. In the end what users want is something that's simple and that's very very trusted, high security, high reliability and when you're building your strategy like us that's what we're focusing on what is it that most people want and what's the um sustaining product that you want to build what social platform is most important to lovable's growth at the moment um i think i'm not sure if my team likes me sharing data here but twitter and linkedin is what the ones i know are the big ones and what we're also seeing instagram because i But yeah, because I feel like products, when they actually go mainstream, like going mainstream looks like going over to Instagram and some of these other platforms.

1:42:41It feels like beyond a niche, which I think of LinkedIn and X as. But yeah, I mean, it's a big community. So it makes a ton of sense, especially with some of the larger enterprises that you're working with, the business side. That makes a ton of sense. What does the top of funnel look like and growth function look like? Is there a flywheel where someone builds and then shares? and then I imagine that there's links built with Lovable in the footer, but is that a real engine of growth or is our advertising? What's driving growth overall at the high level? Yeah. And so we're seeing about 300 million visits to Lovable applications per month.

1:43:19Okay. So that is a real effect. People are like, oh, this is a great website. And most of the time that leading to a conversion is that you're just talking to the person like, oh, yeah, you built it with Lovable. Sure. And that is a part of the biggest channel, which is just word of mouth. And that continues to be absolutely... They see something cool, even if it's just a small demo, even if they're not paying for that business, they see it and they're like, I want to do that, but for me or mine. Yeah, they hear about us from a friend or they see about us on the internet.

1:43:52And yeah, I'm looking at investing more into growth, of course. And then I think Instagram and getting growth marketing really, really strong. It could be the next big channel. Super Bowl's coming up. It's not too late to throw something together. Maybe next year. Maybe next year. We'll see. TV of TV eventually. It's not a now. It's not a now. It's not a now. Thank you so much for coming on the show. This was fantastic. Have a great rest of your trip. We really appreciate you coming by. And we will tell you about Finn.ai, the number one AI agent for customer service if you want AI to handle your customer support go to fin.ai and up next we have I'm expecting a Super Bowl ad I want a Super Bowl ad, they could do some really fun stuff, I mean even some of the customer testimonials would be great, even if they go with something more, they should build the entire ad in lovable, dog food the product we have Christian Garrett and Delian Asperuhov in the Restream waiting room, we will bring them in for the TBPN UltraDome Delian, Christian Jim, how are you doing?

1:44:55How are you feeling? What's going on? Ready to go, baby. Live from New York. You guys look fantastic. Good to see the boys. Great to see you guys. Take us through the news. Break it down for us. This is year four, correct? Year five. Year five. Whoa. Third year of doing the daytime forum. So we started it back in the day just as like a small dinner series. And then three years ago, kind of experimented with daytime forum. That went great. And then this could be our third time doing it. Okay. What's special about this time? Who's on the lineup? You want to start? I'll start. I mean, obviously the 250th is great timing for us to have another event here.

1:45:33We're very excited about that. I think the key focus this year outside of continuing to build on what the forum has always been about, which is building bridges between technology and government, the technology sector and government, is going to be increased focus, not just on technological leadership, but industrial leadership. And then as well as looking at having leadership among our allies. So I think this year you'll see a bigger expansion of the industries where technology is having an impact and playing a critical role. And you'll see leaders from companies that are leaders in those industries.

1:46:01And you'll also see a lot of folks coming from abroad and participating as well. And so I think you're just seeing that the relationship of the bridge between technology and government is actually a key framework for building deep relations between the U.S. and our allies, as well as building deep relationships and strengthening other industries. And we didn't say it, but March 24th, Washington, D.C. For now, we've only announced some of the private, you know, basically speakers. We haven't announced any of the Gov speakers yet, but it's folks like Trey Stevens from Andurl Founders Fund, Vinod Khosla from Khosla Ventures, Brad Lightcap from OpenAI, Shamsankar from Palantir, a bunch more that we'll start to basically release.

1:46:35But yeah, what I like about this year is we're also going to start to expand themes a little bit. There's going to be a strong basically biotechnology sort of focus and some folks both within the administration, within private industry, talking about basically how we need to make sure that we don't lose that entire supply chain industry to China the same way that we have with consumer electronics or humanoids. you're starting to see some like early signs towards that and there'll even be some joint policy put out that hvf will be you know sort of endorsing and so what's been cool is as the like forum has been around for several years we're now not just like acting as a gathering place but it's even a place for people to start to think about you know not just meeting but even like publishing policy together that aligns sort of like private public incentives in a way that is like the best for the nation and then throughout all this you know we like i said we started this five years ago obviously under the biden administration continuing to maintain i think you know sort of true bipartisanship.

1:47:19You know, Vinod Coastal obviously has a certain set of, you know, sort of thoughts about, you know, sort of policies, regulations, et cetera. I may not necessarily agree with all of them, but we try to, throughout both the, you know, sort of forum, the events that we host, everything is pretty consistently, you know, sort of, you know, even and across the aisle. And we try and stick with, you know, sort of centrists on, you know, sort of both sides that can actually sort of reach across the aisle and, you know, produce productive policy together. You know, you won't see a ton of the, you know, sort of extremists from either, you know, either party there.

1:47:43That's great. I noticed Young Liu from Foxconn is attending. interesting company. Obviously, everyone's very familiar. Do you think there's going to be more energy about let's bring more Foxconn manufacturing to America or just startups trying to work with Foxconn? There was this leak that OpenAI might be working with Foxconn. To make sweet pea. Sweet pea earbuds. And it feels like more and more companies, as they think about hardware, they're going to be wanting to establish a relationship with Foxconn. That's sort of the beauty of this, at least from the business side. What's interesting about Foxconn?

1:48:20Why is he important to the conference? Well, I think first off, you have Foxconn, Qualcomm, you'll have some other names that will be announced across these other kind of categories of companies that have maybe been in industries that weren't viewed as technology industries, but now increasingly are. And I think a lot of leaders that are coming there are really just representing a trend that you've seen, which is once again, technology industry is a great way to build deepening relationships and partnerships with our allies and to your point it works both ways right yes you'll see just like TSMC who's made a huge investment in the state of Arizona and you're seeing that from other companies as well here domestically you're also seeing companies abroad continue to invest in other countries and scale there through partnerships like these an example in another country you know we've seen Andrel for example invest heavily which Andrel's a portfolio company for Founders Fund and 137 for us respectively Andrel's invest heavily in countries like the UK, Australia, and Japan just recently opening their office there.

1:49:19Japan is another country as well as many others like South Korea and Europe that are increasingly opening their doors to become manufacturing hubs for the re-industrialization here in the US as well as supporting their own re-industrialization efforts. And I think you're going to have to see many companies like Foxconn play a critical role as the West tries to shift off of reliance on Chinese capacity across critical industries. We as much as possible obviously try to make it so that it's you know, sort of bipartisan from the elected officials and, you know, sort of Congress. But we do try to, as much as possible, whichever administration basically is in office, try to reflect some of their priorities.

1:49:51And what you've obviously seen under this administration is, you know, them leaning into, you know, making sure that our allies are, you know, sort of contributing their fair share, but also reestablishing their own reindustrialization efforts. And so I think a significant theme of this year's forum is going to be having a lot more international presence and there to both, you know, sort of learn from how the U.S. is reindustrializing, but also partner with some of these companies to bring those technologies locally, partner with some of their local, you know, sort of primes and reindustrialization efforts to accelerate those.

1:50:19In some ways, these trends that you're seeing in the U.S., the United States is much better off if France, if Germany, if the United Kingdom, if Australia, if Japan are mimicking basically those same technological patterns. And so that's definitely going to be a major topic of this year's forum. Yeah, I know you haven't announced the government attendees, but is there a desire to have international leaders attend as well? Is this going to be the next Davos in a couple of years or do you want to keep it focused on domestic policymakers, U.S. policymakers, senators, representatives? I mean, obviously the event being in D.C.

1:50:51and the core focus is on the technology sector and the government sector in the U.S. But the event's always been international. You know, from the beginnings, we've had foreign ambassadors from other countries attend. We had the VP of Taiwan speak multiple times. I think you will see a lot more international leadership attend as well um i think it's reflective to delian's point that this really is about the west being successful and um you know the concept of it's not us alone right and so i think yes you will see that represented um most of the leadership of course is still going to be heavily uh domestic right and so leaders from congress leaders from the administration etc but you will definitely see a lot more leadership from from countries abroad and our allies and that's going to be very exciting and that's going to be from the middle east uh japan south korea australia taiwan and you're up.

1:51:37You'll see like in the long term, I think the way that like this will always break down is it'll probably be like 85%, 90 % domestic focus, but there'll always be like a twinge of international. And so I think that's what it's been probably historically on the attendees side of things. And this year for the first time, there'll be a few more sort of like internationally focused panels, but it's not going to, I think, quite go to like Davos level, which is like a kind of global elite in some ways. It's always going to be primarily sort of United States focus with a twinge of international. What are all the ways that people can participate, they watch from home, be a part of it, whether it's a sponsor, all that stuff?

1:52:09Yeah. So the event is invite only to participate during the day in Washington, D.C. But it is going to be about a thousand people. So it's a relatively broad audience that we'll be bringing in there. We'll also be live streaming all the panels on our YouTube and X accounts. And then there will be a couple of media groups that are live streaming from there. Some traditional ones like Bloomberg and some super exciting novel ones like TVPN on site there. So there'll be a variety of different live streams to tune into that I think will give you a feel of the event, both the official panels as well as obviously the side conversations that you guys will be doing.

1:52:43Yeah, that's great. What is the business structure of Hill and Valley now? Is it its own nonprofit? We are officially a 501c3. So this is the first year ever. We are welcome to the board of the Hill and Valley Forum Foundation. Yeah. 501c3. Are you guys just being memetic with OpenAI? Yeah. Are you considering a for-profit conversion? Because I feel like the ads, really, we could do a lot with each other here. There's a lot more to be announced, like Dallian said. So just stay tuned. Yeah. But we do have full-time staff, which is really exciting. That's cool. Yeah. Christian and I were starting to get a little too stretched in between both of us having too many jobs.

1:53:22So it is nice finally. And we lost the key leader as well. So we really stretched it. I believe now the youngest undersecretary in United States history. And most handsome. And most handsome. Goddamn. Some of those photos on the official Twitter. The most looks, Max. Goddamn. I would have looked like that. Yeah, yeah, it's true. Maybe I'd be an undersecretary then. I'll be his undersecretary. So, yeah, talk more broadly about the 2026 calendar, 2027 calendar. People know the annual event in D.C. There was that one-off event with All In. There was a special Hill and Valley sort of collab. Is there a plan to do a quarterly series, have other dinners go off the Hill and have something in the Valley?

1:54:01What are you thinking? I think it's something that we're open to opportunistically. It's not something we're committed to or it's part of the plan. We very much focus on the main event every year, but absolutely, we actually just did something recently with FII, who is also, they do an incredible job. Their conference is right after the Hill and Valley, So I recommend most people, which a lot of us are, will end up flying straight to that right after. And Richy Atiyah has done an incredible job of really gathering a lot of world leaders and running an incredible event in Saudi. And they've done events globally.

1:54:31We did a collab there and brought a lot of Silicon Valley leadership. Ruth Porat from Google attended. Sriram, right from the White House and the administration, attended and spoke. And a bunch of other folks. And so I think we'll look at these opportunities where we can try to help bring more of really Silicon Valley to these other events internationally, particularly when it aligns with countries that are our allies and their focus on building deep bridges between technology and government. And so I think you'll see some of those maybe internationally or potentially obviously domestically the one-off event with the all-in guys with Jake Houchamoth and Freeberg and Sachs obviously in his role organizing that along with Jacob.

1:55:07That was incredible. We would love to do more things like this. Just opportunistic. So if it happens multiple times in a year, great. If it doesn't happen, also great. I think one of the ambitions that I have for the event is starting to become, you know, sort of more deep in particular sectors. Like, you know, this year, very intentionally trying to go a bit, you know, sort of deeper into biotech. I could imagine eventually where, you know, you have the marquee event, you know, on a particular day of the week, but there may be some, like, subsector tracks, you know, over time where we do, like, Hill and Valley Space, Hill and Valley Biotech, Hill and Valley, you know, industrialization, Hill and Valley Rare Earths.

1:55:35And those are maybe, like, subtracks. And again, with the goal of this being, like, I don't want to just gather people for gathering people's sake. Like, maybe that's what they do in Davos. But, like, you know, the goal is, like, I would like to actually make sure that, like, I thought your whole brand was, I'm the networking guy. Here's a 20-point thread on how to network. Yeah, this is a mastermind, right? We should remand this as a mastermind. Neither of us were at Dallas at that point. Okay, okay. My favorite type of venture investing to do is just follow the heat. That is how you generate returns.

1:56:04You just identify the heat and invest into the hottest deals, and other people are marketing it up. You just got to market up even faster at higher prices and chase momentum. Well, speaking of exciting deals, Bridget Mendler was on the show yesterday. The chat, we just want to relay this. The chat is pulling for Bridget Mendler. Attendance is speaking, an invite, something like that. We'd love to see her there. Bridget is a veteran. Bridget's been there. Oh, fantastic. Okay. A lot of them. Kevin Whale, also, I have to shout him out. He's been a veteran. I know he's coming on later. He's attended every single forum and has been an incredible partner for us.

1:56:35And obviously now, alongside Open App and great partners. And so the stuff that he's working on on science, by the way, is awesome. I'm very glad he gets to talk a bit more about that later. So, yeah, it's it's Bridges actually a veteran. So we need to find a poll for someone that has not attended before. OK, I know what I like is like there's some pretty we have like a just a really solid veteran squad. It's like Alex Karp been there every single year. I've been there every single year. Trey Stevens, I think, went to the second one coming back this year to speak. And so I think what's nice. That's a big deal for Trey.

1:57:02I know. Yeah. Trey's hard to be social. Exactly. I just peer pressured him a lot this year. So, you know, I got him up there. Yeah, you mentioned a bunch of different categories. Is energy top of mind for you? How are you thinking about all the work that's going on? We see a lot of energy or a lot of excitement around nuclear. Been tracking a little bit less in solar, but who are you interested in? What conversations are you excited about in energy? Yeah, I think there'll be like two major areas that you'll see energy come up in the forum. The first is there is going to be like a nuclear sort of focus panel.

1:57:32I haven't announced those sort of panelists yet, but let's just say there may be one that's a general. Yep. As one of the panelists. And then other one, I think, where you'll see an angle on it is a little bit in relation to basically like the build out of the physical infrastructure behind AI and how much of energy is a limitation there. So those would be kind of the two topic areas that we focus on there. And again, with both those, trying to make sure that by the time we get to the forum, there's particular sort of policy and things that are coming out of those panels that aren't just discussions, but ideally legislation that's going to be passed.

1:58:00So we always try and make sure the forum is in a week where both Senate and the House are in session. and so in some ways Congress basically chooses the dates of the forum more so than we do but as much as possible I'll try and make it so that policy immediately comes out of it and sometimes we also react live. In one of the forum's years the main event was the day before the TikTok CEO's basically what's called briefing in front of Congress and so obviously there was a lot of discussion that year and policy papers and recommendations from that group around what needs to be done with TikTok. Yeah, Dellian nailed it.

1:58:32Dress code. Dress code. Should people wear different colored shoes? Dellian, suit. What do you guys recommend? T-shirt and jeans. There you go. It is DC, so probably not full Silicon Valley casual, maybe more business casual, or suit and tie, definitely. No, it's the best dressed event in tech. On the tech circuit, it's the best dressed one. It's fantastic. Yeah, we went last year. We are not the best dressed people in tech, but it is the best dressed event in tech. It is fantastic. I have been told that my head of the head of comms at Hill and Valley is unhappy with the fact that I keep wearing the same damn gray suit every single year.

1:59:09And so I was just taking me shopping later today. Well, it's also the set. You also wore the shirt last time you came on the show. I don't know if you know, I actually wear this specific quarter zip every single time I'm on TV. I know because it's the green. It's the green. I make sure that it's washed every single week so that I make sure that I can wear it. Fantastic. Well, we appreciate it. Thank you so much for coming on the show. Can't wait to be there. It's going to be very fun. Congrats on the list. Everyone will be staying tuned to the new guests. See you in Washington, boys. See you there.

1:59:40See you later. Goodbye. Let me tell you about Okta. Okta helps you assign every AI agent a trusted identity so you get the power of AI without the risk. Secure every agent. Secure any agent with Okta. And up next, we have Eric Sufert from Heracles Media. He's been on the show before from Mobile Dev Memo, if you're not familiar. He got us absolutely fired up about advertising. We're huge fans of him. We're huge fans of advertising. And he's in the Roostery waiting room. So we will bring him in to the TBP and Ultradome. Eric Suford, how are you doing? Good to see you. How's it going, guys? Thanks for having me.

2:00:14Thanks for hopping back on. We've been following the ChatGPT ads rollout, the story. You've had a ton of great analysis. We've talked about it a little bit on the show. But we wanted to hear it from you and dive way deeper. So maybe you could set the table for us on what the launch is looking like right now, what the product is looking like, what your expectations were. Just maybe begin at the beginning of this saga for the ads in ChatGPT. Well, the saga begins where ChatGPT begins. We all knew we were going to end up here. We all knew ads were coming. I mean, I wrote a piece May 2025. I said, obviously, ChatGPT will monetize with ads.

2:00:53Why did I feel so confident in that? Because they had just hired Fiji Simo. She's kind of known for having led the mobile news feed ads product to Facebook. That's obviously been one of the most successful ads businesses in the history of mankind. And so it seemed natural that they would bring, given the domain expertise they had acquired, that they would bring ads to bear for ChatGPT. And they have. Now, the launch looks like the launch of Netflix ads, right? And if it remains that way, it probably doesn't bode well for the business. But I think they're going to evolve it over time. And what they've said now or what's come out, the information has had a lot of good reporting on this.

2:01:31They're charging on a CPM basis, which is not standard for kind of direct response ads. It's more like a brand advertising formulation. But so it's$60 CPM, which is exactly what Netflix came out of the gate charging. They're asking for commitments of less than a million dollars. So this is clearly like a testing phase. And they're going to offer very little in the way of measurement or targeting. So this feels like a very sort of primitive MVP. But, you know, the question is, like, how quickly can they evolve it into something that looks more like the Facebook ads platform? So what do you think got us to this place where you get Fiji Simo?

2:02:09She's done this before. She has massive connections and skill set. But it still takes, you know, eight months to roll something out that feels not as mature as something else. Is it a talent issue? Are there other regulatory concerns or do they need to worry about certain edge cases that people might not be aware of? Or is it specifically strategic to actually, is there some secret reason why they're taking this approach? So here's my hypothesis, right? And so it's not just about, you know, Fiji Simo, she's the CEO of apps, but they acquired Statsig, which is, you know, staffed by a lot of X meta people, that was an experimentation platform.

2:02:49That's the exact kind of talent that you'd want to ingest into a company if you're going to roll out an ask platform, which needs to be aggressively experimented on. Here's what I think happened. I think, you know, ChatGP, so OpenAI kind of evolved over time. It was a research lab. Then, you know, obviously they've had the drama around trying to pivot into a for-profit corporation. My guess is the investors wanted them to bring in somebody that was a little bit more sensitive to, you know, the commercial sensitivities, right? And so Fiji Simo would be a very good fit for that profile. They brought her in.

2:03:22And my sense was there probably was a little bit of animosity internally towards the idea of this being an ads-driven business, right? Primarily an ads-driven business, which I think it ultimately will be. Only like two years ago, Sam said, I look at ads as like a failure state. And then he started pivoting the rhetoric and started saying, well, I like some of the Instagram ads. When they're targeted well, they're actually delightful. and in the right context, they can be good. And he was coming around to the three of our worldview, which is that advertising is great. But he did have to message that externally.

2:03:56And then obviously had a whole bunch of work to do messaging it internally. And maybe that's why there was a little bit less energy internally to really push towards that. That makes a lot of sense. Well, he may have been the one that was messaged too. He may not have been the one controlling the message there. He may have been the one that was messaged too. We need ads because ads are inevitable. It's not that ads are great. Ads are inevitable. If you want to reach what I call humanity scale, ads are inevitable. If you want to monetize that at the scale it can be, at its total potential, you need ads.

2:04:24That's how you do it, right? And so he may have been the one that was convinced. And bringing someone external in who had been there, done that, may have been part of an investor strategy. But putting aside my hypothesis, look, I think this has the potential to be an incredibly successful initiative. The question is how quickly can they pivot into something that looks like the meta model, right? So if you look at it right now, it's, you know, and I think, look, everything you just said mirrors what happened at Netflix. For years, Netflix said we would never do ads. Ads are offensive. They're an affront.

2:04:53They're an affront to my sensibilities as a consumer. That's what the leadership said. And then one day they weren't, right? And the exact same thing happened with OpenAI. And all in. Six months. All in. Don't forget all in. All in was anti-ad, and we begged them. We begged them. We begged them. And now it worked. And I think they made the decision independently, of course, but they're running ads now. Are they always coming around? Yeah, I've been banging the drum since May of 2025. But I think the question is, is it six months? Is it 12 months? Is it 18 months to get something that looks like meta ads, right?

2:05:25And that means targeting, right, based on behavioral profiles. That means measurement. That means explaining to advertisers the sort of impact of what you've delivered on their behalf. And that means like a whole lot of tech that needs to be built out. Right. And that means, you know, creative optimization, all these things, just conversion optimized advertising is very different from what they're offering. And is it six months? Is it 12 months? Is it 18 months to get there? That's a big question. Right. But that'll determine the success. And if you say, look, this mirrors what Netflix did. Well, that's not really a playbook that you want to draw inspiration from.

2:05:56Right. I mean, they had to pivot. They had to do a hard pivot. I mean, the ads tier has been alive for three years. They did one point five billion in twenty twenty five. Right. So, you know, it's it's not a significant chunk of the revenue yet. I think it could be a much larger chunk of the revenue, but Netflix has other concerns, right? They've got quality concerns. They've got consumer sentiment concerns where they can't just fully embrace ads. I don't think ChatGPT is limited in that way. Yeah, yeah. Take me back to that initial launch of Netflix. You said similar CPM,$60 per 1 ,000 views.

2:06:26But what was the response like? Were there any advertisers that were like, yes, this is great. I got my money's worth. It worked out. Was it just vague and unattributable? My perception is great performance marketers are always excited to try new channels, especially a channel that's driving high-intent traffic. So if you tell a performance marketer, hey, I've got a billion users, and I'm going to let you advertise to them, they're going to be excited no matter what the general setup is because they just want to get in there with a test budget. And you'll talk to marketers, and at a certain scale, they're like, yeah, let's try 100K here.

2:07:01Let's try 100K there. It's just like you're just kind of throwing around money and then you're going to double down on what really works. Right. For the initial rollout, this is how you launch an ads platform. Don't get me wrong. This is how you launch an ads platform. That's why I'm talking about six months versus 12 months. This is how you do it. This is how you bootstrap the data. This is how you get people on board. This is how you get feedback. You have to launch it like this. There's no other way. You can't launch a conversion optimized ads platform because by definition, you don't have any conversions data yet.

2:07:28Right now, that's that's another reason why I think they they launched Instant Checkout. I think instant checkout is a stalking horse. I think that's a method of gathering conversion data that they can use to then target against with ads. I think that was the whole purpose of that. Right. I don't think that was seen as a long term revenue opportunity. I think that was seen as a way to bootstrap the data. But this is how you launch in an ads platform. I mean, it's got to evolve into a conversion optimized platform, but you can't be that at the start. You can't intuit the settings. You can't intuit the tuning that you need to implement to make this work.

2:07:56But but the question is, how long does it take them to get there? Right. And so that we'll just see. But my sense is they've got the DNA. The information report, they have 700 ex-Meta employees. Essentially, everyone at Meta is working on ads, whether they're working as an account rep or they're working as an ML engineer. They're all sort of growing in that direction. What's been your reaction to instant checkout? There's been a lot of debate on the fee structure. Some people saying no retailer can afford this. we were pushing back on that in a number of different cases. There's plenty of brands where you say, like, would you spend like 4 % of AOV to acquire a customer?

2:08:36I can also see the other side of it. A concern that I have is like, you know, you're running an ad on a meta platform to find a customer. The customer then goes to ChatGPT if that's where they're searching for products. And then the brand is effectively paying twice to like actually find the customer, drive them, get them interested. and then at the bottom of the funnel, they're paying another 4 % fee. That feels not great, but what's been your reaction? Yeah, so I was in the former camp. I said that that's not a workable fee. Let me come back to that, though, because you asked a question about what happened when Netflix offered ads.

2:09:08They had too many advertisers sign up. They had too many. They were supply constrained, not demand constrained. They had to return money. I think that's exactly why OpenAI is saying, no, look, we're setting an upper limit on this. A million is the max, right? Because they won't have enough people to advertise to. This is just a way to test it out and to start scaling. And the problem Netflix made was they never act. So the problem that Netflix had from day one was they had the partnership with Microsoft with Xander. So they were using external tech to run the ads, right? Xander is an ad platform.

2:09:36And so that's the problem. They couldn't implement, you know, custom placements. They couldn't do a lot of measurement stuff. They couldn't do a lot of targeting stuff because they weren't operating the actual pipes, the actual plumbing that was delivering the ads. There's a lot of, like, data issues, just access to data issues. That's not what OpenAI is doing here. OpenAI is starting out by building their own tech. And Netflix, by the way, pivoted to that. But they pivoted to that very late. That's why I think the ad initiative at Netflix was not successful and hasn't really delivered that much revenue.

2:10:03But going back to the 4 % fee, first of all, here's what I think is going to happen. I think they're going to drop that to zero or very low. It'll be tiny because I think the whole point of this is to just drive conversions. And the whole thing is like when you see performance in ChatGPT as a retailer who's just basically paying for the conversions essentially with the fee, you're going to want to actually advertise against that. You're going to want to control it because you have no control if it's just surfaced based on what ChatGPT believes is relevant. And at some point, you're going to have too many retailers to place into a single placement, so you're going to have to mediate that by bids.

2:10:31So ultimately, I think this gives way. In the main, this gives way to advertising. But whether the 4 % is sustainable or not actually comes down to how you view what those purchases are because it's not user acquisition. You're not acquiring a user. If you were, then you'd compare that to LTV. But since it's not user acquisition, you're not acquiring that user with a long-term relationship in mind. You're essentially trading a percentage of the checkout for the checkout. But that user doesn't interface with you. And in a lot of terms – So there's not going to be pass-through to the underlying vendor, you're saying?

2:11:10Well, no. I mean, look. You're the merchant of record, right? And you get their information because you have to fulfill the order. But OpenAI specifically says in the terms that you can't use your email address for remarketing. And Amazon says this too. So the thing is you're not capturing the customer. You're just giving 4 % for that one-off transaction. But you have no control over whether you reach that customer again, whether that customer is brought into your orbit. That's a very different proposition from advertising to someone and acquiring a customer. You acquire that customer, you get a whole stream of opportunities to remarket to them.

2:11:42If you're just trading 4 % for the transaction, that's all you get. So it's not actually customer acquisition. If you think about 4 % per transaction, now consider that if you thought about the people talking about, you know, when that number came out, they talked about, well, some people spend, you know, 50%, 60 % on Facebook ads. Why is that different? Because that's over the life cycle of that customer, not for the one transaction. Or even one time they pay for the customer one time and then they come back, you know, 15 more times or they end up subscribing and they've actually owned the customer relationship.

2:12:11Yeah, exactly. Exactly. And, you know, think about it also this way. that 4%, that might be all the margin you're getting as an e-commerce operator. And the thing is, that's not preventing you from advertising. That's not saying, okay, you have to save your entire advertising, but you're going to still have to advertise everywhere. This is going to be a tiny sliver of your orders that you're not in control of. You can't control it. This could be lumpy. This could be up one month down the next. You can't control that. You're going to have to continue to advertise. Now, you have no idea, to your point, whether this is cannibalizing purchases that would have happened from the people that you advertise on other platforms, right?

2:12:45So this ends up just being a cost, a drag, probably on your advertising expenditure elsewhere. Can you explain attribution and the evolution of Netflix's ad product? Because if I'm sitting on my couch watching a movie and I see an ad and I go to my phone, it feels really disconnected. Even in a pre-ATT world, it feels extremely hard. How do they do attribution? How good can this get? And then with ChatGPT, what's the upper bound on attribution for OpenAI, given that we are in a post-ATT world? Upper bound is basically what you see with Facebook because it's going to be direct response. It's going to be click-based, right?

2:13:25With Netflix, it's a little different. So with CTV, the way that companies do measurement and attribution in CTV is traditionally they set up what's called a clean room. So I set up this environment. It's a centralized environment. I push all the ad interaction data that I have. So basically when I know I showed an ad to someone, I push all the data into this clean room. A lot of times it's IP address and device information. And then the advertiser pushes that information into the clean room and I match it up. That's attribution for CTV traditionally. Now, there's other ways to do it. There's other ways to do measurement that's just totally probabilistic.

2:13:55This is like media mix modeling and stuff like that. But with attribution, when you want to use that term, traditionally it's done with a clean room like that. So I'm just like linking the data sets together based on some key. A lot of times it's the IP address. But if you think about clicks, like clicks out, right? So that's like I'm viewing, I'm on second screen, I can look at time, there's time elements, you look at temporal elements to do attribution. But if I'm clicking out, I've got the click. I've got the click. And so that carries a lot of information. I can still look at temporal aspects of that, but I can do a lot with the IP address too.

2:14:24And so that's, if you look at a CAPI, that's what CAPI is. A CAPI is just a way to get this data on the back end so it bypasses the mobile device, it bypasses the browser. so there's no way for Apple to interfere with that with ITP or ATT. And so you're able to get, it's still probabilistic in that way if you consider the decay of the validity of the IP address over time to induce probabilistic measurement. But that's traditionally how it's done in a pixel as well. But, I mean, that's what OpenAI has at its disposal. It's got the CAPI and the pixel because it's going to be click-based. So there's a high degree of fidelity that will come with the measurement there, the attribution, that's way higher than what you can do with CTV.

2:15:07What do you think the prospects are for the number of companies that are trying to build LLM ad networks? I got pitched at least a few companies that were maybe a year or so ago saying like, hey, LLMs are going to be free. They're going to insert ads. We're going to build this kind of network to serve ads across a bunch of different apps. I was super bearish on those specifically just because I thought that OpenAI would want to own the full stack. I obviously Google would own the full stack. And I think we're heading towards, you know, an oligopoly of sorts and consumer AI. And where's the scale really going to come from?

2:15:43But any kind of takes on that front? Well, there'll be a long tail of agents that are going to want to monetize with advertising. So I think there might be space for an ad network to exist that services them. I don't know why that wouldn't be an existing ad network. I don't know why that wouldn't be just sort of DSP I don't know why that wouldn't be the trade desk but yeah I think there's probably an opportunity to monetize some of those long tails of agents with ads but if you think about like a chat check of course they're going to build their own Perplexity is apparently restarting its ads initiative I think these companies it would be silly to not build their own you want to have that ad stack so you can make everything bespoke and maximally perform it.

2:16:25If we look at meta earnings I mean, that's exactly what delivered that big beat. And I think what people forget about the prospects of this sort of like AI enablement with advertising in digital advertising is that these effects compound over time, especially when you're talking about direct response based ad platforms. Right. So like with Meta, I've been banging this drum since Q1 2025. These effects compound like people point like, oh, 3.5 percent or 5 percent or whatever, increasing click through rates or increasing conversion rates from Andromeda or from Gem or from Lattice. Who cares? These are tiny.

2:16:56No, but first of all, that's every quarter they're noting these performance improvements, but also they compound over time. If I'm targeting 90 % a 90 day recoup on my ad investment and 120 day, 110 % ROAS, what am I doing after 120 days? I'm reinvesting 110 % in advertising on your channel. And so if you're giving me 3.5%, 5 % bumps every quarter, that's just going to end up getting reinvested. That's why we're seeing the growth reaccelerate. Growth is re-accelerating going into Q1 2026. That's amazing. That's why Facebook was up 10 % last night because growth is re-accelerating. They're going to see growth rates they haven't seen since the post-ATT doldrums.

2:17:33That's incredible. That's incredible growth. And anybody who doubted the CapEx historically has to accept that reality now. And they did. They did yesterday. Yeah. Yeah. What people like the criticism is like Zuck is being so ballsy with the CapEx. Specifically on Gen.ai, which they haven't shipped Gen.ai products. Specifically, and the criticism is like, hasn't launched a hit Gen.ai product yet. Our take earlier on the show was like, look, this guy is serving more Gen.ai content than almost anyone on Earth. Even if he doesn't have like a breakout net new product, his product has massive tailwinds because of all this.

2:18:12Like he's in a perfect position to decide, yeah, I'm going to be one of the biggest spenders in this category and plan however many years out in advance. They're making more money on AI than anybody except for Google. Look, the idea that they're not utilizing generative AI, have you seen the ads on Facebook? Those are all generative. There was a revolt. There was an advertiser revolt. There was a scandal recently because Meadow was being too aggressive with the ads generation. The idea that they're not implementing generative AI is absurd. I mean, first of all, generative AI is not just what you see in the output.

2:18:46I mean, they talked about pairing LLMs with ad ranking. that's really fascinating cutting edge research in advertising using llm to sort of give you feedback on the ad does this resonate is this something that someone would click on like pretend you're this demographic there's already research that shows that that has a really beneficial impact on advertising it's not just like what you see in your feed but also the stuff that you see in your feed is generated the idea that they're not utilizing generative ai in advertising that's absurd you can see it just go on facebook right now yeah that makes a lot of I want to move on to other companies, but I want to have one more question about OpenAI.

2:19:22Do you think that there's any sort of risk to push back of the creepy ads, like being too well-targeted? Facebook went through that with the T-shirts that said your name on them, basically, and your whole career path. My assumption is that eventually you're only getting ads that were specifically generated for you. This idea of historically you'd have one ad that a brand would make, and they'd run it at the Super Bowl. They're like, we're going to send this to all of America. And then eventually with, you know, on platforms like Meta, I would assume that every ad is like a one-off generated. And it knows exactly how to position a product, what color, what environment to put it in.

2:20:02And it'll be insane that we used to have ads that we'd make one piece of creative and then run it to like 10 million people because it was like good. And it's like, no, this will all just niche, niche, niche, niche, niche down more and more. Yeah, what do you think? Look, I mean, it's like the idea that everyone would see the same feed when they opened up Facebook is absurd now, right? I mean, like, look, if people truly hated creepy ads, Facebook user numbers wouldn't, you know, monotonically increase every quarter, right? And, you know, Europeans would be lining up to buy the subscription in Europe.

2:20:36And when in fact, only 1 % of users in Europe has taken that offer, right? Is that an offer to eliminate? Is that like an ad free like meta offer? Is that what you're talking about? Because I know they're talking about rolling out. So they've got the less personalized ads option in Europe as a result of the DMA compliance. So they have three options. They have a full on subscription, no ads. They get the less personalized ads and they get the normal experience. One percent of people opted into the subscription. Like people hate ads. They just hate them less than every other monetization model.

2:21:05Right. People love ads. And if you look at, you know, demonstrated behavior, people love ads. People love access to free tools. People love access to sort of like endless capacity. Right. You start capacity constraining things or you start putting up paywalls. You know, obviously, by definition, those are going to get used less. Right. Or most likely by definition. And so the thing is, like the idea that like ChatGPT is going to run into this problem that's unique to chatbots. I just don't buy that. And first of all, maybe they will because maybe they'll design this the wrong way. But I give them the benefit of the doubt.

2:21:37I think they can do it in the right way. And one way to do it is to just not tether the ad at all to the chatbot context. You could just say, look, this is a display ad for what we know you're in market for based on Cappy, based on the pixel. And we're going to make sure it has nothing to do with what you're talking to the chatbot about. So you never have to even question whether the chatbot has your best interest at heart. That's a very easy way to sidestep that problem. But I think they've got very skilled people there. they know exactly what that trap is and they're going to avoid it yeah do you think we're going to get ads in siri in the next 24 months no because of just because of apple's uh because of the optics of apple doing that i think apple would probably love to do that i think there's probably people inside apple that are pitching that but they won't because uh it's not in alignment with their optics around advertising but but nonetheless we were talking we were talking like i think people will be normalized to ads in apple products they obviously are in the app store today.

2:22:31Gurman was talking about ads in Apple Maps coming in the near future. And then I think from that point, if people are starting to use Siri as a search engine, there will be ads eventually. It will just be to be able to serve ads basically natively in the UI to iPhone consumers will just be too tempting. They got to do ads in the alarm clock app. I want to wake up to a different ad every day. Get out of bed and start buying. Get online. It's time to check out. Yeah. Morning to night, you should be consuming. I don't know. Maybe. I think Maps podcast for sure. But the thing is, I wrote this piece when Apple introduced ATT.

2:23:15I said, Apple robbed the mob's bank. I said, look, this is just an opportunity for them to shift some of the budget that's going to meta into their own ads ecosystem. They did that because they expanded their Apple search ads. They just doubled the number of impressions per search. They've got two placements now in Apple search ads, and they're also blurring the lines between ads and organic results there. So the idea that Apple hates ads, I think, is mistaken. I think what Apple needs to do is they need to sort of walk this tightrope of appearing to hate ads while also benefiting from ads because they are such an accretive, sort of margin-expansive way to make money.

2:23:53So Maps, for sure, I think Podcast is another prime piece of real estate for ads to be inserted into. I don't know about Siri. That feels like maybe a little bit too on the nose, but who knows? What about Gemini? What was your reaction to Demis talking about ads in Gemini? That makes total sense, because they're already monetizing Gemini with ads. They're doing it with AI overviews and AI mode. They're monetizing ads and AI overviews at parity with Search. Why would they rush to put ads in Gemini, the chatbot? Keep in mind, Gemini is two things. Gemini is the family of models and Gemini is the chatbot.

2:24:24Why monetize with ads in Gemini the chatbot? You never need to. You could just drive adoption of that. They're already monetizing Gemini the family of models through AI overviews and AI mode. AI overviews reaches 2 billion people a month. That's the biggest single LLM output ad surface that exists. They're already monetizing Gemini through there. Yeah. And is that product just – what's the shape of that product? Is that just the exact same as just branded keyword search on Google? Are there anything different or any learnings from the ads in AI search overviews or AI-powered search? So AI mode is essentially the chatbot.

2:25:05AI overviews is the results that basically takes up now the whole above the fold on Google search. But it's better. It's better than search. You know why? Because the whole point with search is I want this to be one shot. I want to type in my keyword and I want to get the best possible result in that first list of results. And if I don't, then I think your product is bad. And so Google is incentivized to make sure that there is one click. And that's it. So you get one chance to show ads. With AI overviews, the whole point is to then prompt further queries. So you get a bunch of opportunities to show ads.

2:25:36So if that's monetizing at parity, it's probably also driving impressions up. I think that's a much better ad surface area than traditional search. Yeah. Yeah. How should startups, business owners be thinking about TikTok under new ownership? TikTok is funny because they're going all in on commerce again, it seems like they had a really big kind of Black Friday, you know, whatever event, you know, revenue pop, revenue spike. But, you know, they seemingly had had we're walking back the TikTok commerce opportunity. Now they seem to be leaning into it. I'm not quite sure what to expect there. I think, you know, TikTok, I think they were in a little bit of the stasis for a while just because of the uncertainty around what was going to happen with the with the spin out.

2:26:20My sense is now that they have the certainty, they'll probably lean into where they feel like their best position. And that might be commerce now that Meta has completely abandoned it. You know, and I but I think like I just don't think that that's the right approach. I don't think Western audiences really appreciate that as much as just the ads driven model. And so, you know, the pure play ads driven model. So we'll see if that ends up working for them. But yeah, I mean, I think TikTok, you know, if Meta can do what they did to Snap with TikTok, they're going to be in a pretty difficult position.

2:26:50And they may have to just adapt in ways that Meta won't. And that would be leaning into commerce more heavily. Yeah. I always assumed maybe naively that they would lean out from commerce because it seemed like it was just a money pit. They were just lighting money on fire. And the new owners would say like, OK, we just bought this. We have to pass back 50 % of our revenue to ByteDance. The whole economic model of the business seems super upside down. Let's just serve ads and try to run the business lean and maintain the user base. But leaning into commerce just feels like, I don't know, there's so many brands that I've heard about over the last 12 months that are scaling into the hundreds of millions of revenue.

2:27:30and it's almost all on TikTok shop. And it just feels like that was, you know, basically subsidized by ByteDance for a long time. And will the new owners want to subsidize these brands that are driving real volume? But ultimately, I don't know if they would be able to stand on their own two feet. Yeah, I mean, they did walk it back. I mean, they did two rounds of layoffs in the commerce division. Yeah, I mean, the thing about, one thing you have to remember about TikTok and the ByteDance and the whole, like, the parameters of this deal is that they're still licensing the algorithm, right? So I think that impacted the valuation and that may impact some of these other economics.

2:28:10But yeah, I mean, I just feel like they maybe sense that that's an area where Meta retreated and so that's where they could potentially flourish. But it was odd because they did walk that back and now they seem to be embracing it again. Yeah. What's your current thinking about the Netflix-Warner Brothers deal? It feels like we're in a lull. that's moving forward, but would be interested to see. Yeah, I'm also interested just how do you think about, you know, Paramount's prospects as an ad platform without all of that IP? Yeah, yeah. Yeah, well, so it's interesting. So like the thing is like the IP is so important, right?

2:28:46So like one of the aspects that I found really interesting about the Netflix deal was that they essentially valued WB Games at zero, right? So WB Games makes, whenever they're big hit games, it makes their Game of Thrones game on mobile and Mortal Kombat games and a lot of different console games, Batman Arkham. And at one point it was for sale in the multi-billions price range. And so Netflix essentially evaluated that zero. Why? Because ultimately there'd have to be like an IP licensing agreement that allowed them to continue to monetize those games. So I think the same is probably true on the IP side just generally with WB.

2:29:18My sense is like what this indicates to me is like, and this was just, I mean, this was said explicitly in the earnings call. It's like, you know, we're going to pay for content one way or the other. And like, we need this high end IP. Right. And like, you know, if you look at, I mean, everyone saw the Joe Rogan clip with Matt Damon and Ben Affleck talking about like, Netflix makes us restate the plot of the movie like every couple minutes in dialogue, because if people don't hear it explicitly, they just lose interest because they're on their phones. Like you wonder, okay, well, is that a result of like people's attention spans, you know declining or is that just because the stuff you're pumping out isn't that interesting and people are not really paying attention because they're kind of bored right and so I think maybe it's the latter and so if you bring in a bunch of top-notch IP maybe that keeps people more engaged and then hey maybe that boosts the the ad CPMs or maybe you know and ultimately boosts subscription numbers but my sense is like they're going to pay for content one way or the other and like you know maybe just buying a lot of it in bulk at once is the best way to do that.

2:30:20What else are you tracking this week across earnings? You know, Microsoft and Tesla. I don't know if you follow those stories. But what else is interesting to you this week? Well, we've got Apple right now.

2:30:36Yeah, I mean, I think like, you know, you had a German on yesterday. And, you know, he's just always an amazing wealth of leaks. It's pretty impressive that he's able to get those. Apple's pretty buttoned down. But yeah, I mean, I think just the AI story there is kind of embarrassing. And, you know, like I wrote this piece a while back, Apple is besieged on all fronts. And I was talking about like, look, if you look at AI, if you look at some of the threats to ATT in Europe, you know, there's a lot of issues that they face. I think, you know, one of the big questions for me when they announced the deal with Google to use Gemini for, you know, Apple intelligence, you know, which among other use cases includes Siri, was how they would just manage the privacy aspects of that.

2:31:22Because they were so adamant, right? They talked about the private cloud compute. They were so adamant that when we do this, we're doing it the Apple way. We're doing it the privacy-centric way. And then they do the privacy-washing thing, which is just then to partner with Google and allow them to do all the dirty work of sourcing the data, right? Sourcing the data to train the model, right? Or of just monetizing with ads. And they just get a cut on the back end. And in this case, Apple's paying. But at some point, but at some point, Google will be paying for penetration into iOS and the exposure.

2:31:49And I think, you know, that's just a question of like, is that really the reason? Is that part of the reason why they never invested here? Because they couldn't really do it in the Apple privacy centric way. And if you want someone, you know, if you understand that the dirty work of sourcing this data in ways that maybe are not completely above board or just monetizing with ads. I mean, Apple makes so much money from advertising. They just don't do it directly. Right. They do it through the partnership with Google. Now they're going to be making money through AI interactions, but they're not actually the ones training the models and sourcing the data in ways that could be questioned.

2:32:20So I think that maybe plays a part in it. And I think maybe when you get to a point where all of this can be done on device, when the device is actually powerful enough to service most of these use cases, maybe you have smaller models. You don't have foundational models, but you have smaller models that can all run on device. And maybe Apple will be more interested in that. But I mean, like you have to look at the AI thing is either as a massive whiff, which seems to be what German's take was, or it was just a sense of like, look, this is actually going to be really difficult for us to reconcile with our brand imagery and the sort of messaging that we've, you know, we've relied on for years and years.

2:32:51Like, you know, privacy, that's Apple. Maybe we'll just outsource this in the same way that we outsource search, right, and advertising to Google until we're able to all process everything on device and ensure that we can maintain that messaging. Yeah. I mean, my take is I agree with the whiff narrative, but also it does feel like there's the seeds of a rebuild between this new acquisition that they're doing. They're starting to open the pocketbook a little bit. The hardware really is best in class. We saw that with the Mac mini boom to some degree. People are excited about the Silicon, Apple Silicon.

2:33:27And then just the partnership with Gemini, like they're going to have access to something frontier so they can start to vend it into different places. But it's just on Apple's timelines, which have been slow lately. So, yeah. Yeah, but the iPhone Air was a flop, right? I mean, we'll see what happens with the foldable. But I mean, I think they are facing – obviously, the replacement cycle is really long now. I think one thing that's kind of under-discussed is I wrote this piece a while back, like years ago, where I said, what are the implications of a billion iPhones? And this is well before there were a billion iPhones in circulation.

2:33:59And my point was the implications are that a lot of those are in the developing world, right? They're secondhand, thirdhand iPhone devices. And that's kind of like there's this strange dilemma that Apple faces. Like the more powerful the devices get, obviously, the longer you can go without replacing them. Right. Because the demands of Spotify aren't changing. The demands of Facebook and Instagram aren't changing from like a hardware perspective. Right. And so the question is, like, how how how central can you make AI to the core use case, which is a lot more compute intensive? if you do everything on device, how central can you make that to instigate a need to replace the device more frequently, right?

2:34:38Not just like the, because the power of the device at some point doesn't even matter. Like, okay, you tell me like the compute capacity of the next iPhone is 10X what I have now. Okay. Well, are the demands of Spotify 10X? Because that's the only app I use for hours and hours every day, right? And so that's kind of the question. And so it's like, If all of that functionality can sort of percolate down to the iPhone 7, and no one really sees a difference in sort of lifestyle between the brand new iPhone and the iPhone 7 with their only using Instagram and Spotify, how do you actually convince people to upgrade on every cycle?

2:35:15Because keep in mind that as that sort of install base, iOS install base grows, most of that's going to be through secondhand. Yeah, yeah. Yeah, German, it was interesting yesterday, he shared that a lot of Apple's advantage on the hardware side and AI is because of the self-driving push of the car that ultimately failed, allowed them to do the R &D that is now being rolled out of devices. Apple had a huge quarter, beat estimates on the revenue side by$4 billion with China specifically. That's great. and up after hours. The other news that's kind of interesting, I'd be curious before you leave, Eric, ChatGPT is retiring 4.0 as of today.

2:36:03Yeah, that's interesting. Putting it to bed. I'm sure that'll make a lot of people mad. But it's a simpler process for them, yeah. Well, yeah, but they also launched Go, right, which is the sort of like lower price point subscription tier. So my sense is like, you know, if you're trying to push people to adopt that, which I think they are. You maybe have to get rid of some of the older models that the free tier relied on. Well, thank you so much for taking the time to join. This is always a blast. Yeah, I really enjoyed it, Eric. Come back on soon. Thanks for having me soon. Have a good one. Have a nice time.

2:36:34Goodbye. Cognition, they're the makers of Devin, the AI software engineer. Crush your backlog with your personal AI engineering team. And I'm also going to tell you about Vanta. Automate compliance and security. Vanta is the leading AI trust management platform. And without further ado, we have Kevin Wheel from OpenAI, Chief Product Officer in the Re-Stream Waiting Room. Hey, what's up, guys? How are you doing? Great to see you. I'm good. It's good to see you again. Thanks for having me on. It's been a minute. Yeah. What's new with you? Since we've had you on the show, you've changed duties. You've changed focus.

2:37:08Like, reintroduce yourself, I guess. Yeah. By the way, I love that we are talking about science today. I think we need to bring more of this kind of coverage to science and get people excited about science because, you know, there are a few more important factors in all of our lives. And AI is going to, is in the process of fundamentally changing science. So, yeah. Yeah. What, what is your focus? Because science and health can mean a bunch of things. It can mean D to C, you know, advice. And, you know, one of the ways to cure cancer is just to get a lot of people to stop smoking cigarettes. That's something that they could learn by Jajibetting, should I be smoking?

2:37:44And it makes a very convincing case for why you should not. and maybe it helps you not smoke. At the same time, there's researchers that are going to spend decades developing cancer drugs, getting them through FDA approvals. There's a whole bunch of different ways that even Microsoft Word and PowerPoint and Excel helped the previous generation of biotech companies. You can imagine LLMs vending in there and then you can imagine the fully automated AI scientist. What's been your focus? Where do you think we're going to see the most progress in 2026? Yeah, the mission of our team is to accelerate science.

2:38:18And the reason that we are starting to do this now, I mean, it's obviously been something that OpenAI cares about a lot. But when you go back a couple of years, we were all amazed that GPT, you know, 3.54 or whatever could do well on the SAT. And then you start seeing it solve graduate level problems. And then it does OK on math competitions. And then you fast forward a bit and our model can win a gold medal at the IMO, at the top math competition in the world. And now we're seeing it solve open problems in mathematics. So things that humans have not solved, suddenly AI models are contributing solutions to.

2:38:57And it's not everything. It's not every open problem. Science is far from done, right? But the fact that AI models can now contribute at the frontier of science and actually push beyond where humans have gone before is incredibly exciting. Because if you can replicate that across math, physics, biology, chemistry, material science, and you can do the next, say, 30 years of science in five years instead. If we can be doing the science of the 2050s in 2030, the world is a better place. Yeah. And the models are there now. And so this is a huge focus for us. So, yeah. Talk a little bit more about your work specifically, because not to discredit you, but I feel like part of the magic of these large AI models is that you get a lot of this stuff for free.

2:39:48Oftentimes, you don't need a specific SAT model. You just build an amazing model, and it learns how to code and also learns how to write poetry and tell jokes and it can do some science too. So how are you working on fine tuning? Is there a reinforcement learning project? Is there specific compute allocated towards this? You have a team. Are you listening to certain customers? Yeah. I imagine my guest was just working really closely with customers, understanding, making sure they're not just signing up for ChatGPT off the shelf and using it, but actually building a bunch of specific functionality for them and innovating on the products.

2:40:21Yeah. Yeah. How do you think about that? Yeah. Well, it's not about building offshoot models. This is still about improving our core models. But there is, if you think about science, science has a huge surface area, right? So you want, there's a lot that we can teach models at the frontier that, you know, there's work that we can do to make our models even better at performing frontier science. And that crosses from pre-training into post-training and reinforcement learning. And so we get to solve frontier problems in science to make our models better. There's also a whole lot of work that we can do on the tooling front.

2:41:04Scientists use a lot of different tools, and you want to bring those to bear so that the model is using the same kind of advanced scientific tooling that scientists are, because then it can be an even greater force multiplier for the work they do. So there's a whole bunch that we're doing on the pure model front. That's not the only thing, though, because I think if there's anything that we've learned from the way that AI has completely revolutionized coding over the last year is it's two things. It's great models, and it's also integrating AI into the environment where engineers operate, right?

2:41:41You don't spend your time going to ChatGPT and copying and pasting back and forth. You use codecs in your IDE. And bringing the model into the environment where you're working is a huge part. That's why we launched Prism yesterday. The idea is, or I guess on Tuesday, but the idea is to bring great models that can help with AI into the workflows that scientists are using every day. In this case, Prism is about scientific writing and collaboration. And if you can help people communicate their ideas faster, if they can use AI to express the research that they've done, collaborate with other scientists, that's its own form of acceleration.

2:42:20So we both want to make model smarter, and we want to bring AI into the environments that scientists are operating in day to day. Both of those are parts of accelerating science. So talk about some of the integrations. ChatGPT at one point just got access to a Python REPL and could sort of write code and execute it in the query for just a GPT-5 Pro query. But ChatGPT also has an integration to Gmail, and there's some sort of business development relationship. What is your, as you're bringing more tools to bear in the scientific workflow, is there some sort of balancing act? Do you just need to integrate with everything?

2:43:01How do you think about actually wiring up and unhobbling the models? Yeah, I think it's about both a handful, a set of tools that we think are going to be broadly useful that we can integrate ourselves. As an example, if you're in the process of trying to solve a hard scientific problem, you need to solve a differential equation. Models are actually smart enough these days that they can solve a differential equation just by reasoning through it. But you also can integrate a computer algebra system, a system that will deterministically and very quickly solve differential equations. why not let the model use that and go back to doing what it does best, which is reasoning broadly about how to solve hard problems.

2:43:46So you have that, you have protein databases and biology, you have so many tools like this. And I think it'll be important because I might be a scientist studying the evolutionary biology of snails, and I might have my own set of tools that I use, or maybe small models that I've trained that are good at doing very specific things. So it'll be both about us teaching the models to use certain tools that'll be broadly helpful and enabling scientists to bring their own tools to bear so that the models can very deftly adopt them into the process. What does a Chachupu-T moment look like for PRISM within the scientific community?

2:44:26Ooh, that's a good question. You know, I think it's going to be a more like process of incremental compounding where you've got a product that helps people work and operate faster. You've got models that are going to be increasingly useful. And we're going to see kind of two, you know, exponentials, if you will. One is just the exponential that the models are on and their ability to help any scientist who's adopted them. do what they do faster, right? To aid in their thinking. I was just talking to a scientist earlier today who called GPT 5.2 a metal detector for hypotheses, right? So he's thinking about, he's got so many different ideas in his head.

2:45:14You can only run so many experiments. You only have so much time. And he uses GPT 5 as a thought partner in helping him hone in on the most valuable ways to test his ideas. So you've got that exponential. And then there's a separate one that comes from scientists beginning to adopt these tools, because a lot of scientists still haven't adopted them. And the more that they do, the more that they individually move faster, and the more that the entire field of science accelerates. So I think there's a lot to be excited about here. A couple weeks ago, we talked to Andrew from Cerebris, and I was asking him about where wafer-scale computing is most exciting to him.

2:45:53And he actually cited science as a particularly valuable place. And I was wondering if you had thoughts on the value of speed or the value of different chip architectures in the scientific workload. I was kind of coming to it like, well, you know, developing drugs takes a long time. It's probably fine if the model goes off and cooks for an hour. But he was sort of pushing back on that. And I'm wondering how you think about the different parameters. Obviously, we're on an exponential with intelligence and capabilities, but there's also latency and usability and flavor. And there's so many other knobs that are being turned as the models progress and as the projects progress.

2:46:37Yeah, I think one of the interesting things about scientific problems in particular is that when you're solving the hardest frontier science problems, you need to do a lot of thinking, right? If these problems were easy, really smart humans would have solved them long ago. And so the kinds of problems that are left often involve the model thinking, not for five minutes or 20 minutes, which would be a long time if you're inside ChatGPT, but maybe an hour, two hours, 12 hours, two days. and that is where we're going. And if you have really fast inference that can take that two-day rollout and turn it into a six-hour rollout or an hour thing only takes 10 minutes, then again, that just is more opportunity for you as a scientist to maybe instead of testing two hypotheses, you're testing 20 in the same period of time.

2:47:29Again, it's acceleration. Yeah. To go back to the chat GPT moment, how are you thinking about actually seeding your work into the scientific community because there's one angle where it's just chatgpt.com. It sort of goes viral. Everyone's playing with it. That's part of what the chatgpt moment was, was just anyone with a web browser could use it. At the same time, there's only so many real scientists. A lot of them are in labs or in academic institutions. And I could imagine you doing partnerships or deals or anything to actually get something deployed into the most elite scientific environments?

2:48:08Have you thought about the different trade-offs there? One of the cool things is we're seeing so much organic adoption. You go on Twitter these days, as you do, and every day I feel like I'm seeing new examples where someone will say, you know what, I just solved this problem with GPT-5. Or I gave this problem to my grad student and they were busy. It took them too long. I wanted to make more progress. I just gave it to GPT-5 and now I have a solution. And so there's this incredible organic adoption because, of course, when other people see that, other scientists see that, they go, oh, wait a minute.

2:48:46Maybe the last time they tried the models was a year ago when they weren't at a place that they were going to really meaningfully contribute to scientific research. They could help with other things, but they weren't going to help with your hardest problems. Now they can. And so there's this groundswell of scientists that are adopting, GPT 5.2 especially, I think, has been kind of an inflection point. So it's exciting to see, and there's a lot happening, you know, even without us, with people just discovering this and talking about it. Yeah, a lot of people experience that with, like, Andre Carpathia's journey with Vibe Coding, and a lot of people are like, okay, yeah, like, if it's good enough for him, I've got to jump back in.

2:49:25That man is an incredible communicator. Yeah, yeah, really. What's the update on how forward-thinking labs are thinking about integrating with a product like Prism? Ideally, there's a future where a scientist could be at home, have an idea. Maybe they're working in pharma or something in biology, and they can just start running. You can imagine somebody starting to run an experiment just based on a prompt. And then somewhere in the physical world, there's actual, you know, the biological process is actually happening. How much progress is there on that front? Yeah, I'm super excited about the world of robotic labs.

2:50:06I think it is 100 % likely to be the future that we're moving towards. Because you can do so much more in parallel, again, to the idea of accelerating science and moving faster. the world where you can have a hypothesis, maybe that you've honed with, you know, back and forth with chat GPT. In this case, it may also be running simulations, you know, take if you're doing something like fusion, where you want to do heavy simulation before you run an experiment, because your experiments are expensive, then you have the model thinking, running a fusion simulation, looking at the results of that refining its thinking running another fusion simulation and you do as much with the compute that you have in advance so that when you do something in the real world, it's like that much more likely to be successful.

2:50:55You can look at the same thing with respect to biology. There's no reason at this point that you need to have grad students, you know, pipetting one thing into another. The idea that I think like a scientist in a lab coat could easily fade away where they're just like in a normal office, you know, Or at the very least, doing the kinds of things that are incredibly hard for models for robots to replicate. But there's a lot of science that can be totally automated. And the idea of robotic labs that are 24-7 online that you can scale in parallel as far as you can make it efficient. And you have models reasoning for two days to find the most efficient experiments to run.

2:51:42maybe running simulations to test that. And then once they get to a good point, passing that to a robotic lab, which can experiment in parallel at high volume, the results pass back into a model, which reasons about the results and then goes out and runs a different set of experiments. You're doing reinforcement learning with a loop through the real world. And that is absolutely - Are robotic labs something that OpenAI would ever do, or is that best suited for an external partner? How do you think about that point of the stack? I think it'll be both. We want to partner broadly with scientists that have their own labs that are already doing anything.

2:52:21Like I said, science is an extremely broad, has huge amounts of surface area. There's no way that we can do even a tiny fraction of all of science. And I think there will be a lot of opportunity for us to learn from things like robotic labs to make sure that we're working really well with those scientists. So I think it will be both. Can you clarify the business model? There was some confusion about how this might be monetized in the future. Poor Sarah Fryer. She keeps going. I'm pulling for ads in science. I want a pill that I take. It helps me lose weight, but then I wind up loving Ford F-150s.

2:52:56I'm willing to take that trade. Ad-supported medicines. That's what we need. But no, what are you actually thinking? Is anything changing? This is why I love you guys. We're your strongest defenders. Whatever you do. Yeah, Sarah said something when Sarah was talking about, oh, maybe there are ways to like monetize IP. She was speaking specifically to the idea of us doing partnerships with large companies, you know, pharma companies, people like that. Yeah. Where there would be a specific partnership that was developed with the idea of sharing royalties in the future. It was not meant at all about a normal.

2:53:35Somebody signing up for an open AI product. And this already happens with the OpenAI Investment Fund. There's startups that take capital from OpenAI. They build something on top of ChatGPT or GPT APIs. And I think most people inside sort of understood that, but thanks for clarifying. So in general, most people will just be on some sort of API consumption-based pricing or subscription fee, mostly the normal. The nice thing about Prism is you log in with your ChatGPT account. So you just bring your existing ChatGPT account along with you. are this is not you know there are not a billion scientists in the world this is not an effort to like build a brand new business model this is about accelerating science because i think it's one of the most impactful and mission-oriented things we could possibly do yeah that makes a ton of sense give us the update on detachment 201 how's it going are you so oh it's been a blast it's been an absolute blast uh i've been in dc to various spaces things like that uh it i think it is massively important that we bring Silicon Valley and DC closer together because we have an incredible tech community.

2:54:42We have a country and a set of values that are worth defending. And it's a dangerous world out there. The more that we can do to strengthen who we are and what we do, the better. That's great. Well, thank you so much for taking the time to come talk to us. Very fascinating stuff. Yeah. Thanks so much for having me on, guys. It's good to see you again. Good to see you too. We'll talk to you soon, Kevin. Goodbye. Let me tell you about Railway. Railway is the all-in-one intelligent cloud provider. Use your favorite agent to deploy web app servers, databases, and more, while Railway automatically takes care of scaling, monitoring, and security.

2:55:19And up next, the New York Stock Exchange. Want to change the world? Raise capital at the New York Stock Exchange. And yes, we do have a surprise guest who wasn't on the lineup, but he's joining. We have Mahul from Matic. From Matic. What's going on? Hey, guys. Thanks for having me. The Robotics Mastermind. You're going to love this. The other, I think it was two nights ago, my youngest, one and a half, walked in the other room, and I was pretty quick to chase after her, you know, because she's very, very active. She can destroy a lot of things. And I go in the other room, and she has the soap dispenser of the Matic, and she has it fully vertical trying to drink out of it.

2:56:11And I was so appreciative of your design because nothing came out. Wow. That's awesome. But I was so worried for a second because it looked like she was just trying to chug. No, that could end up very messy, potentially harmful. Who knows? Anyways, so excited to have you back on. We've been loving our Matic. Thanks, Frank. And I know you have some big updates. Yeah. What's new in your world? Well, we just announced today that we've raised$60 million in the next round. So led by, yeah.

2:56:45Led by who? Led by Sutter Hill Ventures and Vic Miller, who is joining the board. And we've had, thank you. And we've had some amazing investment in Gavin Baker at Atreides. Oh, yeah. Antonio Gracia, Zed Valor, a bunch of other joining on their own. So it's great. And then for us, this is sort of the output of the product we built and shipped. Yeah, I don't think this would have happened without us shipping. So that's been the good part of it, that it's not about the demos. It's based on real product, real usage, real customers. Real robots, thousands of them. Real robots. Out in the real world, doing real work.

2:57:22Yeah, we've did, sorry, jump in. And we've shipped more than 6 ,000 now and have cleaned about 110 million square feet. There you go. Which results in 80 ,000 miles travel. So part of it. That's amazing. That's wild. Talk to us about pricing and willingness to pay. Obviously, with modern AI, robotics, everything that you're doing, you're creating more value for the customer. Correct. I mean, the sales show people are willing to pay more than the previous generation, which I feel was like more of a three-digit price point. And we were talking about, will people really pay$50 ,000 for a humanoid?

2:58:00That feels like a big jump. But what are you seeing in terms of just willingness to pay for robotic processes amongst consumers? So, great question. We actually launched first time in April of 2023. No one cared. But we started as robotics as a service. Yeah. And we tried to launch it as a subscription. and that was like an organ rejection. That didn't work at all. So people are definitely not interested in paying yet another subscription. That's another one thing we learned. Then we priced it at about$1 ,500 plus subscription as an attachment in November 2023 and learned again that that didn't work as well.

2:58:40That that was the price point at which a lot of people weren't yet convinced that at least the robot vacuum or this could do a job. So we really took that feedback to heart and then eventually priced it much, much lower introductory price of about$9.95 and now it's because of tariff we've had to raise it a little bit. But really what we learned and this was our thesis to day one that if you take a step back and think about it, there is literally zero ubiquitous consumer electronics device priced higher than $2 ,000. Beyond $2 ,000, it's prosumer or you pay for cars. There is literally nothing.

2:59:16Yeah, so that's why I think the humanoid robot rollout is going to be just really brutal because you're trying to get adoption of a new product that is still very much like going to be in an R &D phase. And you're asking people, you're asking people to pay the price car money, but counterpoint piggyback rides. You can take it to work. Replace your car. You hop on the back. It's a car that can clean your house. It's a car that can do the dishes and i'm hopping on the back give me a piggyback ride to work and then while i'm working you're gonna go around and clean do all sorts of i don't know well well agi is coming maybe it will just do the work for you maybe we'll go there there will be no more commutes but you will need a clean house so you will buy a matic robot in the future that's exactly right well i mean talk about the agi process the process and the models we're seeing like incredible advancements all over image, video models, reasoning models, agents.

3:00:20Are you seeing just natural improvements to the performance of your fleet? Is that just something that rolls out for free? Are you doing your own training runs? What have you learned or integrated from the progress in just fundamental AI research over the past year? That's a great question. We started with this idea that AI is coming and AI would make progress. And that has always been part of it. And we are taking advantage of VLMs and SAM3 and all the open source models that are available to us. But at the same time, one of the things that we had realized on day one, that at least when it comes to home, getting data, given the privacy that consumers want, especially at this price point, was going to be a challenge.

3:01:05So we knew that just like Tesla sold a car, collected data, and now is moving on to autonomy and robotics in the same exact way. The robotic vacuum was our wedge. That's the way we wanted to get inside home, earn customers' trust, build a brand, and also a data wedge. And we knew that if we build it the right way by doing everything on the device and earn customers' trust, they will share data. And that's actually one of the most interesting things, that the long tail with which we actually need all that data is coming in, and customers are willingly sending it to us and they are curating it for us as well because we know this data is actually error-oriented.

3:01:44So that's incredibly helpful. And if you take a step back and think about it, even for humanoids, if you had a humanoid in your home, you don't want it to step onto that dog poop or cat vomit or get tangled up in wires or rug tassels or maybe squeeze or break your kids' toys or dolls, right? So every single thing that we do actually directly leads into it. So our thought was always that, hey, instead of sort of building a humanoid in day one, let's grow a robot. Let's grow Rosie the robot. And we'll solve perception first just using floor cleaning space. And then we can worry about manipulation and kind of think about what would be able to do between five to ten years.

3:02:24And can we enable that sort of functionality and make product useful? And then ultimately get to trusted housekeeper. insane to think about like the actual reality of a humanoid using a regular vacuum you know just like dragging around a vacuum or using a dyson it's like is that really the most efficient way to like clean a floor is to have this huge robot like human-sized robot actually it was in that movie by sentinel man i remember that with robin williams and and he was using the regular newspaper and he was doing it and we're like wait that doesn't make sense like you know do you like we We have this humanoid, really amazing, intelligent robot, but our appliances never change.

3:03:03So there was always this idea that it has to evolve in both ways. Yeah. Any traction or plans on the enterprise side? I'm thinking like hotel rooms, they need to be incredibly efficient. Every minute that someone is in there is a minute they couldn't be somewhere else. Do you have plans there or is that just a total distraction? At the moment, hardware that we've built is really just for homes. I did put one in hair salon and it works fine. We did put some in hotels and everything. So perception and algorithms wise, it is working across the board. We do have people using it in their daycare centers, churches, schools.

3:03:43Animal hospital is another one that we've seen use cases. So there is an opportunity there, but I think that will require a little bit of a hardware tweak. And then we just have to question, is it really about savings time, which is really what we want to do, or is it about just saving costs? And if it's saving costs, then it may not be as interesting of a problem. But if it turns out there is a labor shortage oriented one, then we really need to go and look into it. What about lawnmowers? Uh, lawnmowers is something, we want to stay inside home for a while. Okay, okay. What about advertising?

3:04:14What about advertising? The reason lawnmower, think about it, it's like you guys would make it a fantastic lawnmower, but I've never once thought like in between when the landscapers come to my house, I've never once thought like I wish my grass was just like a little bit shorter today. Perfect every day. Because they're just coming every week. Whereas in the home, it's like your house can always be cleaner. Yeah, every day, every day. That's exactly right. What about an ad-supported tier? It says, hey, I'm on linoleum. Why don't you upgrade to Hardwood? We'd love to connect you with this local contractor.

3:04:44Have you considered NordVPN? I see you're spilling a lot of vegetables on the floor. Why not Athletic Greens? We've been talking to Eric Su for too long today. He got us thinking on ads and everything. Some great ideas there. What's the plan for this year? Like, just scale, sell a lot more robots? Do you need to be in Best Buy and retail distribution at some point? What do you got? Not at the moment. Luckily for us, at the moment, we're still supply constrained. So we would keep selling and doing build-to-order model that allows us to keep working capital low. And the goal is really to scale. We scaled about 20x last year, selling from 300 to 6 ,000 robots now.

3:05:24Thank you. And try to go another 10 to 20x this year. That's the goal at the moment. And there is a second product in the work. I won't be able to go into much details yet, but there will be some exciting stuff. I tried to guess it, and all of our guesses were way off base. A robot that you can take a picture of. But now it's a boarded robot. He's like, no, you guys are not even close. Anyway, thank you so much. Congratulations. Great to get the update. Always great to have you on the show. Yeah, I love, I love. And we appreciate your product. You know, we talk about robots a lot on the show. This is a good one.

3:05:57We love a robot company that's shipping. With a fleet, yeah. With a real fleet out there. And I think the aliens joining today tell him that we're still growing without advertisement, although we will need some at some point. We will, yes. Well, have a great rest of your day. We'll talk to you soon. Great to catch up. Cheers. Goodbye. Let me tell you about Phantom Cash. Fund your wallet without exchanges or middlemen and spend with the Phantom card. And I'm also going to tell you about Restream. One live stream, 30 plus destinations. If you want to multi-stream, go to restream.com. The other news today is, of course, that rare metals are absolutely spiking.

3:06:34Gold's up 4%. Silver's up 7%. Copper's up 10%. Platinum's up 7%. Palladium's up 5%. Oil is up 4%. Geiger Capital says, don't worry, pal, said it means nothing. You look worried. We're all a little bit. Looks very worried. We will be monitoring that. It is an odd dislocation in the market. Boring Business is posting a meme saying, realizing that our collective retirements now depend on whether digital gold coin created by an anonymous founder goes up or down. Is that Bitcoin? No, so retirement accounts will be able to directly buy assets. This is from Kalshi from the SEC chair. Now is the right time to open 401k retirement market in crypto.

3:07:20And so more push into that. One update, some more updates on the Apple numbers, Apple earnings. Mark Gurman says, massive Apple revenue beat$144 billion in overall revenue, $85 billion in iPhone revenue,$25.5 billion China revenue, and$30 billion in services revenue. Tim Cook gets to keep his job. Obviously a joke. And we can close out. We've got to do some of these timeline posts. Yeah, well, let's pull up this video. Okay, let's pull up this video. AI is going to take your job? What job? This is great. We will pull this up while I tell you about Graphite. Code review for the age of AI. Graphite helps teams on GitHub ship higher quality software faster.

3:08:07I pull this up. And let's go to AI. Check in with the job market. Just drinking and driving is the entire job. I've seen this meme template. I have not seen this exact video. But the jump in that car, you have to be going so fast. This makes me want to buy a beater so bad. And just drift it. Just wait for a rainy day. Drifting is next up on the bucket list. You got to learn how to drift like that. Maybe stay off the bottle. Maybe stay sober while driving. Stay off the bottle, but maybe close down a road somewhere. Yeah. Delicious Tacos with a fantastic post. It says, AI CEOs are like if Henry Ford said, these cars are going to run over all of your children.

3:08:55I appreciated this one just going back to, you know, where's our AI Steve Jobs? You know, we can't have every lab founder saying that everyone's going to lose their job. You know, AI is going to kill everyone on a long enough time horizon. I do think Dario has done like a reasonably good job. If you're like pretty tapped in, right, he has this great essay. All watched over by machines of loving grace. Yes, yes, yes. I feel like he's not that public yet. He's starting to do a little bit of a press tour right now. But I think if he was more in the public eye, I think he could be that person. Yeah, I mean, Demis has also done a fantastic job and is one person that's not really highlighted with those questions.

3:09:40But, I mean, this delicious tacos post, Dario's definitely in this crowd. He is talking about job displacement. I guess his more recent essay was about the catastrophic risks. Yes, exactly. Which are important. And it's good that he is talking about it, but it is a very different world than other innovations. It's a different product. Jeremy Fon says, the best way to evaluate a VC is by picking the one with the least bad podcast you'll be forced to go on. Of course, if you raise from a VC, you're probably going on their podcast. Just face it. You may as well pick the one with the best podcast.

3:10:15Buckle up. There are some good... The Jocko Willink Venture Capital Fund. That's what you got to do. You got to do Jocko's pod. That would be amazing. GPT-5, apparently serving it is profitable. According to EPOC AI, gross margins were around 45%, making inference look profitable. But after accounting for the cost of operations, OpenAI likely incurred a loss, of course. They have a huge staff. There's a lot of capex. There's all sorts of different stuff. But just on the actual inference, this confirms what a lot of people were saying yesterday about just comparing the open source models to the private models.

3:10:51Inference, gross margins seem healthy, which is, of course, good news. We went on Colin and Samir's show. We did. To talk about TBPN and media. And John Palmer didn't just listen, he studied. Oh, he studied. And he had a great take here. He said, on the Colin and Samir show, John Coogan laid out a barbell thesis in media. Value either accrues to the platforms or the individual personalities, platforms being YouTube, Spotify, X, et cetera, or the individual people creating the content. He says, I'm guessing that software is headed to the same place. Value goes to the platforms with monopoly distribution, Google, Stripe.

3:11:31Can they think of, you know, system of records, et cetera, or the individual vibe coders shipping one-man businesses at 1 ,000x lower cost? Not much value in between. What happened to the media business is now having a software when production costs drop a thousand X. Remember to make a show like this historic and distribute it historically, we would have needed to be on a major television network. Now we can do it with a, you know, tiny fraction of the costs. And restream. And restream of course. But anyways, interesting, interesting take. And I think we'll see, certainly see some of this play out.

3:12:07Gary Vaynerchuk rebranded his agency for enterprise clients. Chuck. Chuck Media. Chuck Media. He's just reinvented himself so many times. He was Gary Vaynerchuk. I think that's his full name. Then he was Gary Vayner or VaynerMedia. And then Gary Vee. And now just Chuck, which is very interesting. I've talked to some people who have worked with them. Oh, wait. This is a different agency. Oh, interesting. Vaynerchuk's small business agency, the Sasha Group, is being repositioned for enterprise clients as Chuck Media. I think that's separate from VaynerMedia, which is its own thing. Fascinating. In other news, Treehacks at Stanford is looking for new judges.

3:12:48If you have experience building a notable project, building a major company, you're a journalist, a creator, et cetera, please reach out to, I'm going to not pronounce that, Fizz, Coding Dev. He's a 19-year-old CS Stanford. And I was thinking about this, like hackathons were huge in, I don't know, 2010, 2015. And then they sort of fell off or just became sort of like background noise. Like they would happen, but nothing was that exciting. And this feels like the best time to go to a hackathon because people are going to be vibe coding like truly, fully functional products. And there's something about the pressure of the meeting a bunch of people, spending two days, you know, staying up all night grinding.

3:13:33It's really, really fun. I don't know if hackathons have necessarily declined. Like when I was at school, the hackathons were like massive. Yeah. It just kept getting bigger. Yeah. I guess just the novelty wore off and they just became background noise. Yeah, that's right. But it's got to be the best time ever. I remember the first hackathon I went to, it was like, oh, cool. Like Twilio exists. So you can like build something to text you. And now it's like, okay, like you can use agents to just code you everything. and the pool of people, the first hackathon I went to, I didn't really know programming at all.

3:14:06I learned a bunch. I was able to build some things, but it took a long time. And by the end of the hackathon, you sort of just had a landing page that barely worked. Now you can definitely leave with a fully-fledged product if you lock in for two days at a long hackathon. Unicorn valuation, potentially. For what? Oh, yeah, for the company, for sure. And yeah, this seems like a lot of fun. So head over to Treehacks. I have to get it. We both have to get on with Sydney. Oh, we do? Yeah. Okay. Well, we will have to talk about sticker packs tomorrow. We can talk about this for a second. Plant the bomb and talk about it.

3:14:41Dom, founder of Fast, the payments company, launched a new company called Stickier. And I was super confused because he's selling stickers with the TBPN logo. This is very weird. and it's supposed to be a way to like short overhype startups, but you're just buying stickers with other people. It's very questionable where this will go, but we'll have to check it out more in the future. Anyway, leave us five stars on Apple podcast. Thank you. Goodbye. Nice work brothers. I'll see you on the next one.