Shaun Maguire, Harry Stebbings, Blake Anderson, Sean Frank, Adam Ryan, Connor MacDonald, Perplexity $18B Valuation, Tornado Cash

31:12Go to ramp.com. You can see on this image here, you got a little picture of Saquon. Oh, yeah. It says, keep your team focused on the game, not expenses. I love it. We're going to get Saquon on the show. Yeah. It's only a matter of time. Excited to have him on. He can teach us about football. And investing, apparently, because he's a fantastic investor. Yeah, yeah, yeah. He's in Ramp and Anderle now. Yeah, he just got into Anderle. He was over at the Anderle offices. Huge alpha just being a pro athlete and getting into the typically non-sexy categories. Totally. It's normal for an athlete to be like, you know, we've got an NBA player and like Rora.

31:47Yeah, yeah, yeah. I have protein powder, but that's very competitive. Yeah, the real alpha is saying, no, I'm going to become an American dynamism investor. fantastic well speaking of guests before we have Saquon on we got a whole bunch of guests hopping on right now uh we got Harry Stebbings coming the king of Europe the king of Europe the king of Europe Harry Stebbings uh Harry sent a nice note on the timeline yesterday he's been super supportive um it's interesting uh I was DMing him with with him a little bit and I'm sure he's gonna be in the waiting room any second but uh on how he's in the waiting room yeah he was saying he listens to the show and i think we finally made a show there he is long enough for his marathon walks because the guy's putting up 40 000 steps a day uh how many steps have you racked up today 50 000 now so every night like two and a half hours and i listen to you on the walk it's fantastic uh we got it so so just let us know when we need to go from three to four hours yeah because we want to pace with your walking your your your steps uh honest honestly i walk with my mother on the weekends if we could do weekend editions also it would save me having to talk for six hours i love it's been it's awesome to see uh your relationship with with your mom sometimes makes me feel like a bad son because i don't walk for for uh that many hours with my mother but i was just saying uh you had a nice message yesterday on the timeline no thank you it's interesting you know the the shows that we really respect all of them are highly ephemeral right like they're they're shows that aren't really oriented around the news they're oriented around individuals people companies etc and ours is the exact opposite right like it would be kind of crazy to go back and listen to you know sometimes we'll talk about a story that that maybe is more evergreen but um And, you know, you've built up this sort of crazy catalog of some of the most amazing investors in venture ever.

33:46I wanted to have you on for a few reasons, but really to give you an opportunity to talk about Project Europe. We joked on the show that until you guys came out with this new program, the Project Europe that most VCs thought about was planning their sort of trips to St. Tropez over the summer. But you guys are taking it back. Do you know what? We're taking it back. We also have Portofino. Yeah. Fundamentally, the world has decided that Europe has lost innovation. We've lost entrepreneurs. And I meet great founders every day. And you know what they're told? You've got to move to the valley. And I'm like, you don't have to move to the valley.

34:25You can build a massive company here. And I think bluntly, we need to change the vibes. Vibes is everything. Elon, you like him or you don't. The guy knows how to master vibes. And for us now, we've told our young entrepreneurs that you should leave, that you should build a company elsewhere. There's a guy, Gary Stevenson, who is blowing up in the UK, who tells young people that bluntly it's the system's fault. It's not your fault. And, you know, there's nothing you can do about it. There is. I was at guys 10 years ago. I had no money. I was a kid in a bedroom. today we manage over 750 million dollars the show and the media companies multi multi millions because of the internet as i'm not doing that as a me it's the internet and the empowering nature of i i dm'd mark benioff 53 times before he came on the show i i i've i've we remind by the way we remind sometimes we'll message a friend about coming on the show and they like don't get back right away and I'm like I gotta channel Harry right now I just gotta hit him up again and and it's important to share those a lot of people would just you know have the temptation to make it look easy yeah and say oh yeah I just messaged Mark Benioff and he just like popped on it was easy but it's important to remind people that that persistence is what creates totally I mean Logan Bartlett is the same way I think he I think he DM'd he he said he emailed SBF like 15 times to try and get him on the show and I was like I don't know how you could do that it feels so awkward to me but you've clearly like broken it down and it's paid off massively but you know what you've got to get innovative i use suno.ai to write songs about people and then i send them to them so i'm like you know write me a song asking john in a like male folk guitarist tone about you know the future of m &a and then i'll send it to them i promise you you're the only one who's going to do that yeah yeah yeah yeah yeah i mean it's so important in like fundraising sales and you know even growing a podcast it's all the same thing oh my god totally the same thing but but on project europe yeah it was like the doom loop just pervasive and i have so many friends in the u.s who are just like europe dude like why are you still there um it's just it's just not true but the timing but but the timing seems incredible you've been you know banging the the the european drum for a while now but it does seem like even in the last month almost there's been this sort of shift and that's sort of potentially coming from this you know the u.s is getting into trade wars with our neighbors or some of our closest allies there's just sort of like nationalism happening around uh western europe kind of waking up you know people are there's more uh you know the people are talking about what is going to be the andurl of europe you know i'm sure you're looking at some of these companies but the timing seemed great uh i think we're going through this intense period of deglobalization and what happens in intense periods of deglobalization is the intense patriotism.

37:24And I think we're at the start of that now where absolutely we're starting to see Europe once again, get a little bit more patriotic. It's funny you said there about like the andrel of Europe, it's Helsing. And my favorite thing is when you see defense funds and you're like, no, no, I don't quite know if defense is quite the category. It's more like andrel and Helsing. Very cool. Do you, I'm curious, you run your fund, you run the media business do you lp into other european funds are you trying to kind of create a sort of like i'm at one of the benefits a karetsu no but one of the things here in america is great if i've got a buddy who's raising a pre-seed round i talk to them i'm like okay i know 30 people that could lead this pre-seed round like don't worry if any one person says no like you're gonna get a yes just talk to a bunch of people but i imagine when there's probably not 30 london pre-seed funds that you kind of at the moment but maybe there should be or maybe there are i mean i don't actually lp really into other funds just because with the network from the show if i lp'd into one i'd have to lp into all of them so i find it easier to say just like i'm sorry i can't do lp checks otherwise you end up being mark andresen well i don't know a fund that mark andresen is not in i've been so many funds where mark is an investor and so listen he has more money than me and can afford to do that.

38:48I couldn't do 100 funds. Can you tell us a little bit about the patriotism in Europe? Are there layers to this where a Spanish company will only want to raise from Spanish investors and say, hey, get this British guy out of here? Or is Europe kind of solidified in the same way that the United States is kind of a block, even though obviously there's a difference between Florida and New York and California? I would say that Europe is solidified completely there's definitely not this kind of isolationist uh element of like oh spanish versus italian versus whatever and jesus even the english and the french are getting on these days that goes to show just how much of a united front it is and i think especially in the wake of you know the divide that's growing between the us and europe that becomes ever stronger that unified country element of europe and so i i don't see that at all and europe really stands as a block and i think you see that in how people have responded to project europe and we've had you know thousands of applications i started with 25 founders that i was like hey i'll go get 25 founders they're amazing and they will you know write a check into this vehicle to back the next generation we literally went to 150 in three days we've had another three to four hundred requests to be in there's a legal cap of 250 so we can't actually do it yeah it was amazing uh talk about when when you you were an early investor in lovable they've seen ridiculous growth it's one of those charts that's not really you know a line it's more like a wall yeah um was that talk about that round how that came together uh are you getting these companies like weeks earlier than american you know investors that would that would want a shot at it is it is it months you know talk about your edge in Europe on the ground.

40:40Yeah. Yeah. A hundred percent. Um, lovable is a great example of a global company that's being built from Europe and Sweden in particular. Um, their numbers are insane. They're growing, you know, 2.3 to 2.5 million ARR per week. Their retention is better than chat GPTs at over 85%. I mean, it is a monster and their retention is really important. It is not sugar high AI revenues. And so phenomenally impressive. Listen, Anton is quite obviously brilliant. I think we over exaggerate how difficult our role is as venture investors. Our role is to invest in the 1%. And generally, the 1%, I find is quite obvious.

41:20And so when I met him, it was pretty apparent that he was bluntly creating an entirely new category. I've learned one thing in investing that when you're able to make your customer a superhero, it generally works very well. Nike is a good example. Everyone's an athlete. That message is empowering. Shopify, everyone's an entrepreneur. And Lovable allows anyone to build a website. My mother who has a bakery uses Lovable to make her bakery website. that yeah what happens i i love your commentary on just the website market in in general the sort of you know you've got the framers the web flows you know all these different platforms it's felt over the last few years yeah it's felt over the last few years if you just waited for you know web flow to kind of become four years old then you could create the framers and then you could do the lovables unending gold mine honestly yeah and it seems like you've got a cut you've got a couple of different segments here that i don't think people are really talking about enough which is like you've got the number ones which is pe owned larger older players now they are in a lot of trouble they've lost innovation they've lost product centricity um they're in a real world of pain i'm really looking at a lot of the pe board assets your anna plans your coopers of the world thinking wow you were bored at the height of the market you don't have the founder as the ceo you've lost product centricity this is going to be a really tough slog to get back to that acquisition price and they know that and then the second that no one's talking about either is this really worrying segment this is almost what i'm most worried for 50 million to 200 million arsas businesses that are growing in the teens and they're not profitable yet or they're barely profitable they are not acquisition targets for p those are not good enough numbers they're not good enough to IPO.

43:19What happens in that case? And there's a lot of these companies. That is a really dangerous chasm to fall down that I don't think many people are talking about. What about just the broader market? We're seeing a pretty significant sell-off in the US. Is Europe seeing something similar? I haven't been tracking it very closely. When you say sell-off, what do you mean? Yeah, I think he's talking public equities. But I mean, in your position, do you, as a venture investor, probably don't care. But I even talk about maybe just like pricing in the early stage market, which is probably what you're more clued into.

43:54I mean, there's so many things here. I think one thing that no one's talking about, I'm so shocked about it, is like bluntly how LPs are responding to a lot of the endowment policy changes enacted by a Trump administration. I mean, like this is a very, very difficult position for a lot of endowment funds to be in. They're forced to rethink a lot of their private allocations, and that will significantly impact managers' abilities to raise funds this year. Can you step back and explain exactly what the change is? Well, so you're seeing essentially the Trump administration reduce a lot of the budgets that they're able to have to their privates.

44:36And so you're seeing that reflected in how they're engaging with new managers. When I speak to a lot of endowments today, they're simply not adding new managers and they're even trimming their existing. And so I think that's bluntly going to really impact the amount of new managers that we see this year. In terms of pricing, honestly, it's higher than it's ever been for the clearly great assets. And there's a lot of people who come and say, oh, it's so unfair, it's so unfair. I understand that for a lot of the market, you're not coming out of Stripe or Facebook or you name But if you are, you have more money than ever before.

45:12And the prices are honestly higher than ever before. The prices are absolutely nuts today. And so you either have to, if you want to win in Venture State, you have to be one of two things. I believe I'm a better picker than anyone else and can find diamonds in the rough. Or I believe that I am such attractive capital that I can win a beauty contest and still pay a very high price but beat everyone else. Yeah. Do it all at the same time. No, I think that was it. It's funny that any investor who's claiming, you know, complaining about high prices is just like just price every investment perfectly and never miss.

45:51Put up a great fund. But by the way, entry price really matters when you look at Wiz and Insight, something very timely. You know, their entry price was very high. And so people are really shitting on it as an investment saying, oh, it only returned a third or a quarter of that fund. And it's just that the entry price was so high. Well, talk about that. I'm curious. Do you know any dynamics? Because I was wondering, imagine you're the partner who leads, you know,$200 million investment, turns it into$2.5 billion. And then you're kind of waiting around for your other partners saying, like, I kind of did the heavy lifting here, but I need you guys there because they're not in carry yet.

46:27Is there a scenario where that partner doesn't really see much of a personal benefit from having, you know, returning$2 billion? I mean let's just say I think they'll be getting a pretty big bonus at the end of the year so I'm not too worried about them but but I mean it is just testament to the like fun size matters yeah the scale is massive it's never been bigger yeah yeah um all right Harry there's a lot more to talk about we'd love to have you on again go enjoy dinner thanks for coming on late we appreciate you going on late we really appreciate it it's fantastic to have you and we'll talk again soon you are a fantastic company on the walk always let me know what I can do and huge love guys.

47:06Thanks so much. Talk to you. Enjoy your evening. Cheers. Yeah. I was coordinating timing with him and being in London. Well, it seemed like he got to a great podcasting studio. He's locked in. He's locked in. He's locked in. He'll love it. Over time, over time, we're going to get the dallions like a permanent sort of like hub in the office. Just like come flip on the lights. You'll be live. Yeah. Yeah. Yeah. We'll set it up. The remote studio. I mean, that's what the big TV channels do. It's like, oh, if you're doing a spot on NBC, go to the local NBC affiliate in your town and we'll have a green screen and a great microphone and a teleprompter for you and you'll look great if you can stop by.

47:47Anyway, we got Adam coming on the show in a couple minutes. Give me some background on Adam. How do you meet him and what does he do? The godfather of media, Adam Ryan. That is a bold intro. So Adam Ryan's a very good friend. Um, I was actually on the board of his company in the, uh, through the series a, um, and, uh, he prior to that was at the hustle. He like ran sales there eventually was the, I think the president and the COO under Sam Parr. He also was at, uh, under armor when they acquired my fitness pal. So he's just been kind of like right in the, he also was at, um, he was at, uh, spice works as well.

48:27So he's always been at kind of the intersection of like software and business, media and content. And so he can talk a little bit about Workweek. And then I wanted to get him on to talk about the TechCrunch acquisition that happened today, which there's a lot of turmoil. Has the number actually leaked or is that private information? It's private information. But we got it ready. But should we be ringing the sidestime or not? That's what we'll ask Adam. Adam, we heard TechCrunch was bought. we have this beautiful we have this beautiful gong right here uh should we ring it or not i think this is like a poor noise champagne bottle situation it's time to ring it okay okay we'll hit it we'll hit it um but uh great great to see you adam um i just want to say you always thought that i would be good at uh podcasting and always believed in me so uh you know thank you for that you were the first person to say you have a facebook podcast you should be podcasting.

49:26So, uh, but it's great. Uh, I, I gave a quick intro earlier, but it'd be great to have it in your words. And then I want to kind of get into the news. Jordy, I think I, uh, sent you a contract, uh, uh, once to become a podcast. So, so, uh, we can talk about, uh, we can talk about that. Uh, but yeah, it's a big fan of the show guys. It's been, been amazing. Uh, and I've never seen Jordy just, uh, in his natural element of, uh, getting to shoot the shit all day. It's a, it's a perfect, it's a perfect Good job. It's fantastic. Yeah. So work week is, imagine if LinkedIn was only for people that were verifiably in your profession.

50:06So think about if you're in e-com or on a hospital system or HR, you have a platform, social media platform that's built just for you. Conversations there are authentic around your lingo. Similar to what this podcast is all about, actually. I think this is why we all like it as founders is you guys talk like us, you think like us, you bring that out. And we've built that in a social media platform. So that's largely what we do. I think one of the areas that we've focused on is like if I wanted to go launch an HR social media platform, I would never have a shot to do it. HR people would not listen to me.

50:48And so our go-to-market is to partner with operators, practitioners in these industries and have them create newsletters and podcasts that then help us build an audience to drive to these memberships in the future. So that's most of what we're up to nowadays. And previously, as Jordy said, The Hustle, MyFitnessPal, and Spiceworks kind of at various different points of media. Cool. Amazing. let's jump right into uh into tc you know we've talked about this on the on the show before they were owned by what was it aol apollo the private equity fund bought aol it seems like at some point there would be an incentive to sort of dismantle aol the underlying assets and i imagine that apollo uh doesn't want to just hold that position uh forever um maybe just talk about kind of the history of maybe why you think TechCrunch has really just struggled.

51:49I think it was owned by Verizon. I'll give you some background. So founded in 2005 by Michael Arrington, partners of Archimedes Ventures. Eventually, they went under the Yahoo umbrella after its former parent AOL and Yahoo were acquired by Verizon. So it became a Verizon company. And then Verizon sold to Apollo. So it's been private equity back since 2021. and now it has been sold to Regent, a media investment firm. Yeah. It's the property. It's like the hot potato that no one wants, right? It's just been sold and sold and sold. But I mean, I think the through line is looking, if you look at their search interest on Google Trends, they peaked, any guess what year they peaked of search interest?

52:372012. 2011. Good guess, Jordy. 2011 was the peak of their search history today their search history is essentially the equivalent of what they had in june of 2006 uh and it's just been a depreciating distressed asset for 12 years and that's why it keeps getting tossed around and you know um i actually think it's they're an interesting one to study though because like what why were they so good and And they were so good because they figured out one move that was just awesome, which was building relationships with VCs in Silicon Valley, breaking the news, having mom be proud, creating the cycle, keep going.

53:21The mom be proud engine. It really is true. When you start a company, it's so fake for so long. Even if you go to your parents and you say, hey, I got$2 million from Andreessen Horowitz. They're like, who? That's not Bank of America. That's not Chase. at some point you get the tech crunch article and you can send it to your family and be like hey i'm in business i'm a real yeah at some point i i had one funny tech crunch story so we announced our seed round from andreason and we simultaneously launched our pre-seed it was this awesome moment we had been in the timeline a lot and tech crunch agreed to cover the story they didn't tell us when they would release it they didn't even tell us they were for sure going to cover it until like a couple days before and then when they did release it they refused to use our product imagery or any assets that we created and they used a stock image of a birthday cake and we were just like hey like we're really excited about the article and like we want to share it broadly but like this is not on you know not on brand for us and like feels kind of random and they like fired back and they were like you're not you don't you're not a writer here like don't and it was like very hostile and it left this like terrible taste in my mouth and i was like okay i'm never talking to tech crunch again uh and i think a lot of founders have had that sort of frustration where it's like hey, we still love the TechCrunch brand.

54:34Because for me, I grew up reading it. I remember just as a kid going to the homepage and being so excited. And I think it has a ton of potential as being a place to inspire entrepreneurship. But the fall off is potentially that, and this is like the entire work week thesis, is that business people, whether you're an investor, founder, et cetera, want to learn from other business people. and so at some point along the road after michael errington i think was out of the picture there was private equity on they maybe stopped hiring sort of founders or people that just deeply loved you know venture um and it sort of coincided with this explosion of just like you know content creators broadly within venture capital that you know packy would start breaking you know fundraising news and you knew if you work with packy he was gonna you know publish it on the day that he said he was, he was going to make you look good.

55:30And actually deep dive it in a much deeper level than you would ever see on TechCrunch. Right. Yeah. And I think the other piece of that, like two things I think they really screwed up. One, when you build your actual best product, which was their fundraising breaking news around the relationships with the investors, you can't write anything that's actually deeply critical, even in the future. and what they did was they got stuck in middleman land of like you can have like the Axios, Sarah Fishers of the world, Packies that are like hey I'm here to like tell a good story a real story but like to support you or like hard-hitting journalism like I'm gonna like go say the thing that no one wants to say aloud.

56:11Wall Street Journal, John Kerry Rue like he broke Theranos like he's a serious investigative journalist in the business world. They tried You can do both and you just can't win in the middle. Like I think today, like either your editorial and your audience, like it can't be rounded anymore. It has to be pointed. And like you have to be like, this is what we stand for. This is what we do. This is who we support. If you're like anywhere in the middle, you're just going to get forgotten. And I think they lost that like 10 plus years ago. I mean, looking at their X account, they have 10 million followers on X and their announcement.

56:4350 likes. 19 likes on their announcement that they have been sold which is like big news in their own world and it's just so rough yeah it's interesting you know we we had heard months ago that it was for sale and was trying to find a buyer and and i do think the actual purchase price came in a lot lower than than what what they had hoped uh but but what i can imagine happens now is whoever this guy i don't know the guy who bought it but i imagine he basically fires everyone because i can't imagine that that uh he's he's not going to so regents is a private equity firm that owns a bunch of logos that 15 years ago were cool um and his playbook is and tech crunch put this in their own press release um you know they're they i think their gvs line was like this is this is a software update not a system restart um um but he said he's not firing anyone um but he owns a bunch of different logos and publications that are typically distressed assets and i kind of see it as like they're they're hoping he his playbook is like i own 50 of these if i can make a few of them a little bit better flip them in five years and so i don't think they're actually going to probably fire a ton of people unfortunately i think it's actually going to continue the path of not being relevant or good because they're going to not lose money.

58:07And I think they need a whole restart to do that. Let me give a little overview of who they own at Regent Computer World, Network World, CIO Magazine, CSO Magazine, Mac World, PC World, IT World, Rate My Professors, Cheddar News, Military Times, Defense News, Marine Times, Army Times, Navy Times, Air Force times. So a lot of like these hyper verticalized, uh, small trade publications they've put together and then they own some stuff in fashion as well. Uh, and then industrial and consumer products as well. Um, but, uh, and it says that they were in super cuts for a while and then they, yeah, I saw that.

58:45I saw that too. That was a fun, I was like, actually, I'd like to hear that story, but I mean the, uh, I think, you know, when, when was the last time you heard a founder and I'll say like I can't wait for TechCrunch to like break my story and I think that's like the core of what's going on. It's a sad thing because founders would still want them to break the story but it's hard to get them to respond even if you have something that's somewhat newsworthy. What else is going on in media today that you you find interesting? I know you wrote earlier this week about the Skims which was like a hustle era super hot you know newsletter that that sold.

59:20How How did that go? Is there any takeaways from it? Yeah, they, you know, they were started 2014. Oprah said she loved it. Reese Witherspoon, Chelsea Handler kind of like went on this, raised like$25 million from 21st Century Fox, a bunch of good companies. Also hit their search interest peak in 2016. So I think with them, they had a great business. They were probably seven years too late. I think that's a founder, not founders, not selling at the right time than like being bad builders and their time had passed. But I don't think they crossed the prep stack. So, you know, 12 plus years down the drain for them.

59:57And pretty sad considering one time they were they were a household name among among like millennial women for a few short years. But, yeah, that happened this week. And I think that's what we're seeing. It's like it's the onslaught of like if you're not loved, you're out. And none of these people that are getting sold today like have people that are truly like logging every day and loving what they're seeing. Yeah, I mean, last question, then we'll let you go. what do you think the founders of the skim should have done differently? Is there a path where this could have been a great cash flow engine if they'd not raised and kind of run it more as just making them influencers?

1:00:33Could they have been the next, you know, caller daddy or something if they played that differently? What do you think? I do think they were more of a faceless institution than they probably got credit for, which is kind of against my belief of what you have to be today. I think you have to have individuals at the forefront. But also my interesting analysis there from 2014, their press release was like our advantages that were low tech. In 2018, when they announced their series B, they said at the heart of what you do is technology. And I think there's like, it's okay today to just admit who you are and what you do.

1:01:09And they tried to be something they're not, which is a technology company. I think they wasted tons of capital trying to do shit that they have no idea how to do. and they should have just kept with building content for women their age and building creating for themselves and they would have been just fine yeah that makes no sense did you follow anything last question on my side for now and would love to just have you back on when there's when there's media you know headlines um the did you follow so uh caller daddy like you know had all this big big issues with barstool because they just weren't really getting a good deal uh alex cooper eventually leaves, starts her own network, does very well, but then creates this sort of new superstar in Alex Earl.

1:01:52And then Alex Earl announced this quarter that she's leaving. Do you think it's possible to build networks anymore long term or with these sort of like scaled networks, do you eventually just lose your best talent? How does that work? I think it depends. I mean, the Alex Earl one's interesting. I was confused because she was already a superstar i mean she was like uh she was already making like a few million a year um pre-alex cooper i think um what the net what the best networks do i think is find emerging talent um um early early uh like in pre-seed stage essentially as like a content creator um and uh to keep them and i think there's been plenty of good examples i mean everyone talks about bar still leaving but like big cat pft and all those guys are still there um and drive most of their revenue actually and always have and so what what happened how they do that they get paid a lot of money um and uh they feel like they're treated fair and i think that's like at the core um not everyone wants to do everything and i think when you're when you're building out those networks the only way to keep talent is i think to talk to the talent and be like what what kind of life do you want what what kind of pay do you want and you've got to build for that um and i think uh if you look at tv they actually this is what people should take away is like steven a smith just got a fucking whopper of a deal they kept him but he they like knew what he needed he wanted to be the height he wanted to get the highest contract tv's done this really well for a long time friends cast giving them their new contracts to keep them together those are all innovative contracts that keep talent i think to do to to sustain you have to kind of take that same approach it makes a ton of sense well thanks for stopping by we'll talk to you adam see you later talk soon Bye.

1:03:40Very interesting. Nice. Who we got next coming in. Adam's always, he's never, he's never pulled punches in his writing. He's got a great newsletter where he just kind of says it how it is in media. Cause he's been in the trenches, right? He built a million subscriber list while at the hustle. And it's certainly not easy. We got Blake Anderson coming in from the cage live from New York city, where he's been in an apartment for 33 days straight. How are you doing, Blake? Can you guys hear me? We can. Yes. Welcome to the show. They can hear me, but I cannot hear them. Okay. Try it again. Check, check, check.

1:04:18Can y 'all say something? Check, check, check. Go to public.com, investing for those who sleep seriously. Multi-asset investing, industry yields, something by millions. Yeah, like, can you play music and do you hear it in your AirPods? Yeah, let's see. Stocks, bonds, treasuries, options. Can you hear that? Yeah, test speaker. What about Eight Sleep? I know you guys are sleeping on eight sleeps out there. Nights that fuel your best days. How do I sound? Turn on your bed into an ultimate sleeping experience. Go to eightsleep.com slash TBPN. Can you hear that, Blake? Yes, I can. Okay, cool. What about getbezel.com?

1:04:51Can you hear that? I can hear that. Blake's a watch guy. Ramp.com. I was about to ask about Ramp. Can you tell me about them? Yeah, Ramp. Time is money, so say both. Go to ramp.com. You can hear that? Okay, good. Are we good? I think we're in a good spot. uh blake blake okay uh blake it's great to have you on the show uh it's a big day today thank you for taking the time uh you haven't been i think everybody here is very familiar with you just from from pmf4dye and everything you haven't left uh the cage for 33 days today you're launching the app and uh maybe you start to you know get a sense that freedom might be on the horizon but yeah talk to us how are you feeling you know i'm uh i'm feeling very stressed out i'm um i feel like i have this pit in my stomach that is not going away for anything and i think that the only way that i can release that is achieving pmf um and if i do not achieve pmf i think i'll be in a very dire spot you know yeah yeah we're gonna have we're gonna have the the audience will get to vote on the sort of fantasy football style punishment, like you might have to do pink hair or something like that.

1:06:04No, but we're believers. Why don't you break down 10X in your words, maybe just start with kind of the manifesto. It feels like the app is, you know, extremely timely with everybody sort of realizing that one of the biggest opportunities with AI today is giving everybody, you know, a tutor. But yeah, tell us about 10X in your words. Yeah, I think that the power of AI education cannot be understated. Everything that I've built has been on the backbone of AI. And yet at the same time, I have so many friends that constantly ask me how they can use AI to learn more efficiently, to learn how to code, to learn how to market, to learn how to do anything, any digital skill.

1:06:48And I don't think that there exists a platform that's kind of synonymous with AI-based learning. And this was the general background thesis on building 10X. And next came the medium, right? What is the form factor? And so the original form factor with how we were launching and the version that's going on the App Store this evening is a Duolingo style learning path where you can select your skill and progress through the foundational knowledge needed to learn how to code with AI, market with AI, you know, build a business with AI. And so that is one key function of the application. Additionally, we have the ability to custom generate lessons.

1:07:26So you can generate a 15-minute podcast on anything that you want to learn about. I find myself going down these interesting podcast rabbit holes on Spotify. And what I found is that once you get past the very base layer of any sort of domain, it could be machine learning, it could be complex systems, it could be American history, it's very difficult to find these sort of custom-tailored information. to progressing to that next step. And TEDx provides that for people. Additionally, you can track your skill progression over time, as well as chat with a chat GPT, Grok-like basic chat bot within the application.

1:08:02Very cool. I saw a post earlier today from this guy, Chris Pike, who's over at Pace. He says, when elite universities uploaded all of their courses online for public consumption, we collectively realize that the limiting factor for global intelligence is not access to information, it's motivation. What's your read on how motivated is the sort of next generation of builders who the initial 10X app is like, how do you make somebody, how do you turn somebody into a developer, right? Who right now maybe knows nothing. Do you feel like there's like, like just a ridiculous amount of sort of motivation that doesn't necessarily have like a a pathway yet?

1:08:43Do you see that 10X is like, hey, here's how you go from zero to builder? Yeah. So one of the most popular questions that I get on social media is how can I learn to use AI? How can I learn to code nowadays? And there doesn't seem to be any resources that are really constantly up to date with the newest and best techniques. In addition, if we look at what Duolingo has done for language learning, the big thing that they've done is they've gamified it. They've made it fun. And I think that that's in line with your point regarding motivation. And so right now with 10 X, it is significantly more enjoyable to learn through 10 X than through a basic standard chat bot.

1:09:21Though obviously we have the chat bot embedded within, but going forward, one of my primary North star metrics is how much dopamine do you feel rushing into your brain when you hear those little sounds and get that XP and see yourself level up. Do you have, do you have haptics yet? or you got you got the phones vibrating or is that rolling soon yeah we've got we've got haptics um but you know i don't you know haptics are are just just a small step um and a very big mountain uh in competing with uh instagram and tick tock because you know my view for the 10x mobile application is that it might not be the platform that you sit down on and use for three hours straight but it certainly can fill the latent space in your day instead of instagram and actually put it towards something productive yeah talk about this talk about the concept of like character building and and sort of leveling up your character because a big part of 10x is like okay i'm a character i'm jordy i can go on 10x and like level up my character to learn how to code that's awesome uh was there a specific video game or anything that inspired you as a kid that you were super into like that you got maybe way too into was it i think world of warcraft was probably way before your time but uh yeah was there any absolutely so i would say skyrim was a big one so uh not to be confused with the world of warcraft the big difference in terms of the type of person that played the next two games no that that said no um i i think that uh games where you can uh see your skill and and level progression over time are just inherently so much more addicting.

1:10:54Skyrim, Madden, FIFA, even Minecraft in a bunch of these different mods that I would use when I played as a kid. And that was essentially the thesis behind UMAX and what made it go so viral is the ability to scan your face and get this sort of like six-factor rating system about like your skin quality and your jawline and like your overall attractiveness and potential. And so in its current form, it's just XP based. But moving forward, I think that a really interesting thing that we can implement is the ability to take these sort of preliminary challenges and quizzes to assess your current skill position and then make this into more than just a system to come and learn statically and linearly, but something that can dynamically update based on where you're at, where you're progressing, and then become somewhat of a status symbol, right?

1:11:41Right now, we all know the term 10X engineer. I want a level 99 in 10X to be a hallmark of somebody who has agency in this post-AI world. Love it. Talk about your go-to-market. I know this is historically how you've grown your apps is sort of leveraging these sort of short-form video platforms. You're taking all that learning and channeling it into 10X's GTM. Are you doing anything different this time, or is it the same playbook that you've sort of happily shared with the world? Because it's easy to talk about. It's hard to actually do. Yeah, so, you know, I think that 10X is inherently less viral than the previous products that I've built.

1:12:25Now that said, has so much more long-term upside. And so if I were launching a Riz GPT right now, it'd be like, done, wraps. I'd have completed it. I'd be at a million ARR. but I'm trying to build a big business here and I really believe in the long-term mission. Now that said, I think that I'm taking a lot of the learnings that I've had from my previous applications and figuring out how to make something that isn't inherently as viral or maybe like scandalous into something that people really resonate with and still can go viral on organic platforms. And so I think that one of the big marketing messages that we have is you won't be replaced by ai you'll be replaced by somebody using ai learn to use ai now that's inherently a little bit scary and like digs into insecurity and i think that that'll be uh that'll be conducive to to to uh you know engagement on on these social platforms uh we're split testing a ton of different niches we're working with self-improvement creators with ai and tech creators we're working with only fans creators and so we've got the we've got the whole roster this is what you were saying before that somebody logs on to only fans for whatever reason uh and then it's like hey why don't you learn how to code uh when are you when are you uh i know you're you're launching today uh i got the pre-order page pulled up when do you think when do you think you're when do you think you're going live uh because i know you probably still have some stuff to do there no we're going live immediately after this call amazing okay everybody listening blake really wants to see the sunlight he wants to surf he wants to go hiking go download the app uh i just changed my bio real quick to um my my uh x bio which used to be mj of ai apps and then everything it's now i haven't left my apartment for 33 days please download so i can surf and hike i love it all right i'm putting it i'm putting it in the chat right now uh you're the man blake good luck today we will uh we'll talk to you later and excited to see i i see sam sheffer in the background there he's collecting all this footage i can't wait to see the documentary documentary on it it's gonna be amazing and uh godspeed today thanks for having me guys cheers bye what a hilarious project so chaotic 33 days without going outside i mean they do have the roof deck i know you haven't seen the shawshank redemption but when he gets out of prison and he's just being like they do have a little sunlight it's beautiful yeah i guess he can go outside there's somebody in the chat says if he fails he has to this is rusty pitchfork if he fails he has to buy a dodge charger ev and use it as his daily driver

1:15:02brutal so much fun um well should we go to one more story because we have sean mcguire joining in 15 minutes but i think we got enough time to break down the uh billionaire who just bought the celtics he doesn't have a wikipedia page no one knows about this guy uh sean puri said the celtics just sold for six billion dollars to a guy with no wikipedia page money talks wealth whispers send tweet i love it does crazy numbers it does crazy numbers i love when you i love when you can drop something that's um when you can drop something that's just like very niche like only for your fellow posters it still does numbers it's also great because like sean's been on the show So obviously we're notorious yappers and basically the opposite of whispering.

1:15:48But we love wealth, so we'll break it down. William Chisholm was a complete unknown to sports fans and most private equity investors until earlier this week. He just bought the Boston Celtics for$6.1 billion. By the time they're ready to spend their billions, most sports owners are already celebrities in their own right, Wall Street titans, CEOs of prominent companies, heirs of America's richest families. But when the most prestigious team in the NBA was sold for$6 billion, a record price for a pro sports franchise. The most shocking part of the deal wasn't how much the buyer paid, it was the person who bought it.

1:16:17This is from the Wall Street Journal. William Chisholm, the little-known managing partner of a little-known private equity firm, will become the new owner of the Boston Celtics after agreeing to purchase the team from Wick Grusbeck, the parties announced on Thursday. The deal stunned NBA insiders and private equity investors, and even Chisholm himself. You think of me at eight years old, 10 years old, watching the Celtics, never dreaming that this could possibly happen. It's just a pinch me moment. Chisholm has a far different public profile than other NBA owners, especially those who have splurged on teams in recent years.

1:16:53He's nowhere to be found on Bloomberg or Forbes billionaires list. Little L for Forbes there. They missed a big one before the sale was announced. He paid to stay off the list. Yeah. He's getting on there now. He didn't have a Wikipedia page. So this line from Bill Simmons, we know so little about this guy, I don't even know how to pronounce his name. Yeah, it's Chisholm apparently, not Chisholm, Chisholm. Chisholm, whose firm Symphony Technology Group invests in technology companies that handle cloud security software or run job search platforms, has been quoted in the Wall Street Journal exactly once when STG bought the construction data unit of McGraw-Hill.

1:17:29We look forward to helping the business achieve the next level of success, he said. Amazing line. Goated. No private equity bro has ever said something like that before. Yes. Except every time if they don't actually want to make a comment. Yeah. You could have just said no comment, but he's on record with the Wall Street Journal just once. Now the man whose firm invested in companies called Inclusive, Reich, and Keltra has a slightly more recognizable brand to his name, the Celtics. Chisholm, who grew up in north of Boston in georgetown massachusetts spent his professional life far from the site a spotlight he attended dartmouth as an undergrad received his mba from upenn wharton he worked at a private equity firm bain capital i wonder when he worked at bain probably pretty probably in like the 90s or something um and then set off uh to start his own private equity firm stg you still have any you were at bain i was at bain but in 2010 do you have like a bain alumni chat definitely not i would not I would not be in that.

1:18:29No way. But you could have made a generational run at the top for the top spot. Yeah. Got the height for it. Yep. They would have just said, hey, we got to push this guy through. The height thing is real there. I was working out at the corporate gym at Bain Capital once when I was interning there. And one of the big shot MDs comes in is on the exercise bike. It's just like you, like me, race right now. And it was just the most like mogging ever. and he's like, I could put up, it was like the fan bike. He's like, go as hard as you can. I can do 21 units of electricity or whatever. He had some weird metric that he was benchmarking against.

1:19:05And he just wanted like the young guys to see like, oh, like push me harder, you know, because he's like a 60 year old guy. Really competitive. I love it. STG, which Chisholm co-founded in 2002, invests in companies your average Hoops fan have never heard of, but it positioned Chisholm to strike when the opportunity of a lifetime came calling. The capital to put something like this together there's frankly the easy part chisholm said based after striking the largest deal in pro sports history uh it's getting the right folks around the table the investors alongside chisholm include current celtics minority owner rob hale related companies president bruce a beal and investment firm sixth street the celtics shines a light on the changing financial landscape i bet this was sports.

1:19:48This was done over a group chat or around a golf. Probably. Before the Celtics deal, the last three NBA teams that changed hands were sold for between three and four billion. So the price is soaring. The league recently allowed private equity firms and sovereign wealth funds to buy team stakes. So they're allowing more capital in. The price goes up. It's just supply and demand. And it's fascinating because the narrative around the NBA is that they've lost ground to the NFL. Then there's also this larger narrative that just professional sports are falling off and becoming less relevant. And yet prices have never been higher.

1:20:29Yeah. Yeah, these are trophy assets. Yeah. They've, you know, over the last 20 years, they've been fantastic investments. But they don't need to make money to be valuable. Yep. Based in Menlo Park, STG manages just under$12 billion in assets, according to PitchBook. I wonder how much of that is his because he's putting a lot of money into this deal. Chissom's backing from 6th Street drew some shade throwing from current Celtics minority owner Steve Pagluka. I'm definitely mispronouncing that. And I bet all the sports fans know exactly how to pronounce his name. Who would also be leading a group bidding to buy the team from Grusbeck.

1:21:08We had no debt or private equity money that would potentially hamstring our ability to compete in the future, he said in a statement on Thursday. The former co-chairman of Bain Capital is no stranger to private equity. Oh, so both of the guys that were building on the deal were Bain alums. It probably was a Bain chat. You're right. Bain chats. He said he and his group would remain at the ready if the announced transaction does not end up being finalized. We'll see if this Chisholm guy actually has the money. He's throwing down the gauntlet. If you have one false step, I'm hopping in with my deal.

1:21:39Chisholm attended Celtics games as a kid, sitting in obstructed view seats in the rickety old Boston Garden. So when he learned that the team of his dreams was available, he didn't take long to make up his mind about pursuing it. It was certainly a discussion with my wife and family for about a second. Hey, honey. Hey, honey. I know you're working on dinner, but can I spend$6 billion on the Celtics? Oh, okay. Cool, cool. Got it. Yeah, okay. At least we talked about it. Yeah, great. But Chisholm said that - Every husband has gone through that at some point. Yes, the GT3 RS or the Adam Arpigate Royal Oak.

1:22:15These are conversations that you have to have as a family. A little family meeting. Hey, I'm buying a$6 billion sports team. Let's go. He said a central goal with the Celtics is to maintain its current success. Under previous leadership, the team won the 2008 championship and added another last summer. This season is well positioned to become the first repeat NBA champion since 2018. To that end, Chisholm agreed to an unconventional arrangement. Grusbeck is to remain the team's governor, leading its team operations through the 2027 to 2028 season. Chisholm referred to that decision as an intelligence test.

1:22:51Why would you want to mess with that, Chisholm said. That is working at every level. When Chisholm does take the reins of every part of the Celtics organization, though he is confident that what put him in the position to buy the team will let him hold on to its winning ways. in our little way at STG. We've done that too. They've done it in tech PE. So many good lines in here. They've done it in higher job platforms apparently and now he's doing it in sports. Very fun story. Anyway, one day you'll be able to trade shares in these teams. Hopefully you'll be able to do it on public.com investing for those who take it seriously.

1:23:25What's the... Go to public.com. But we got to move on to... We talked a little bit about Wiz. I don't know if you want to do some timeline. We got seven minutes. But Sean McGuire's hopping on. We can talk to him about Wiz as well. I just was curious, what are the publicly traded sports teams? I don't know. There is the Atlanta Braves, MLB. Really? You can just go buy shares? That's Major League Baseball. Okay, yeah. Thank you. Good clarifying. Just our audience follows business like sports, so you've got to clarify these things. Manchester United, it's got some shares on the New Yorks.

1:24:01I'm looking it up because I wonder how these things... So Man U is trading at 2.3 billion on the NASDAQs. You can go buy that on public. Madison Square Garden. Oh yeah, I guess the MSG Group. But that's the garden. That's the actual holding company for all the different media assets. Founded by James Dolan, who also, or I guess his dad founded it, but then he runs it. And James Dolan created the sphere. Oh, interesting. So the Green Bay Packers have done sort of these public offerings, but they're not doing it anymore. But I have a special announcement. It is Jeremy Giffon's birthday. Oh, happy birthday, Jeremy.

1:24:39And I figured we could sing him happy birthday. Ready? Happy birthday to you. Happy birthday to you. Happy birthday to you, Jeremy. I hope you find a special situation today. We love you, Jeremy. Fantastic. You deserve all the success in the world. You're still a young whippersnapper. Yes. And you have such a bright future. Yes, may all your deals go through in 10X. 10X, that's right. Much like this Wiz deal, which did more than 10X, it turned into a$4 billion windfall for Index Ventures. They're set to earn a 250-fold return on seed money in a startup Google has agreed to buy. And the partner on the deal is Sader Shah.

1:25:24And Shah got the call he had been waiting for on his 37th birthday in January of 2020. A promising Israeli cybersecurity founder that he had been asking for years to launch a company was in need of funding. It's time, said the voice on the other end of the line. Shah kicked in$3.5 million on behalf of Index Ventures. Flash forward five years, and that original seed money earned a 250-fold return this week, turning into an$875 million stake when Alphabet agreed to buy Wiz for$32 billion. And Index didn't stop at its first check, folks. It went turbo long. It put more money in whiz during every subsequent funding round.

1:26:06Let's hear it for folks at Index. They built up a 13 % stake. In total, Index has turned its$240 million investment into$4.3 billion. You love to see it, folks. So Bryce over at Indy, Bryce Roberts, friend of the show, taller than you, I believe. I don't think so. Really? I don't think so. Sit up next to him. But nice try. Nice try. And yeah, he broke down. The challenge here is how many they need. They just need so many. This is the biggest software M &A transaction in history. Yes. That's crazy. And we've been on a dry spell since the WhatsApp acquisition for a decade. That was like$25 billion or$30 billion?

1:26:52I think it was like$16 billion. But yeah. Oh, wow. Okay. Which is crazy. So Figma would have been the next biggest. Figma would have been the next. And the crazy thing is Insight needs like 10 of these to have a - A 5X fund. Yeah. Because it's an$8 billion fund that they're investing out of. Although, was that the case for this particular seed fund? Because their seed fund, it might be a different vehicle. Who knows? Either way, a huge win. They made a lot of money. But yeah, we talked about this with Harry. It's possible that they still got to do more work. can't retire to the slopes just yet index keep it grinding find five to six more whizzes come on yeah i'm excited to ask sean about um yeah because uh sequoia was also big in whiz yeah yep uh success stories such as these were once dime a dozen during the go-go years of silicon valley when massive startup exits dominated the headlines and made being a venture capitalist one of the hottest jobs in finance these days the ipo market is dreary prized startups such as stripe and spacex have chosen to stay private for over a decade, putting their investors in a perpetual holding pattern as they await a chance to cash out.

1:28:00Doesn't really matter from a fund performance perspective. For most LPs, they're happy to hold on to Stripe and SpaceX shares at a high mark. They don't really mind that, but still, it's an important factor in terms of getting cash out of these things. Regulators, meanwhile, have become more cautious about blessing acquisitions. Google's whiz deal still needs regulatory approval from the Trump administration. We talked to Joe Weisenthal about the new head of the FTC, the new Lena Kahn. And it seems like they will probably be more friendly to M &A. If this deal gets blocked, venture is dead. Yeah, it would be very, very rough.

1:28:33It's all over. It's so over if that gets blocked. But this is a weird one because it's not, it'd be very hard to make an argument about a monopoly in the cybersecurity cloud market. Obviously, we've talked about how Google is third in cloud. They're not even first. When you look at Adobe and Figma, Adobe is the number one creative suite of apps. It's not like Wiz is going to be competing with Google's core business. Yeah, exactly. It's not really consolidating the search market. I'm sure Amazon and Azure both have cybersecurity products that compete directly with Wiz. And so it would be harder to make the argument, at least I think it would be.

1:29:10We'll see what happens. The review process itself could take years to conclude. So don't buy those vacation homes just yet. if the whiz deal proceeds, investors hope it will pave the way for similar startup exits in the future. Getting the call, when Shah received Asaf Rappaport's call, the entrepreneur and his three co-founders hadn't yet settled on a name or a specific plan for the startup beyond wanting to go big in the fast-growing world of cybersecurity. The how and what, Shah said, was still waiting to be discovered. In his head, Shah called the startup Asaf Co, a testament to his conviction in Rappaport, the founder.

1:29:45It was completely unexpected and unexpected at the same time because I had been waiting, Shah said of the 2020 call. Shah's hunch about Rappaport, a dog lover and veteran, which we talked about, they have dogs at the office, and I believe their dog is the chief dog officer or something like that, and a veteran of the Israeli Army's elite cybersecurity unit dated back to 2014 when Shah backed Rappaport's first startup called Adalom. It was later sold to Microsoft for a disappointing 320 million. I love the Wall Street Journal. But Shaw felt he had spotted an entrepreneur of rare talent after the call.

1:30:24Yeah, I mean, when someone sold 320, they're in the position where they've gotten tons of experience. They've known how to run the full playbook, probably hired a great team, can build a team very quickly, and they probably want to go bigger, maybe two orders of magnitude bigger, which is exactly what they did. and they exited for 320 million, the first one, 32 billion, the next one, it's exactly 100 times as big. Awesome. You love to see ambition like that. We love to see it. Should we talk briefly about the One X and NVIDIA? Oh, sure, yeah. They're doing a research collaboration. Did you see the, you pulled a picture?

1:30:56All I saw was the picture of the robot holding a jacket, but I thought it was cool. I mean, insane aesthetics. Insane aesthetics. Very cool. It almost feels like out of sort of Yeezy inspired to some degree. Yeah, we're getting somewhere with this where it doesn't look uncanny valley, creepily human. It looks more friendly. It doesn't look terrifying. It's not as scary as some of the purely Terminator ones. It would still be weird to have this thing walking around your house at night while you're sleeping. But I could get used to it. This is the friendliest looking humanoid I've seen so far, I think.

1:31:31Yeah. But I like it. So anyway, so developing AI for humanoid robots involves tackling many open research challenges and safety, dexterity, visual understanding, and much more. It helps to compare notes with other labs tackling similar challenges in order to accelerate progress towards a future of NEOs doing all the tasks needed to keep your home in order autonomously. To that end, I like 1X's focus on the home. It's obviously going to matter a lot to just pick it. Focusing on the home is just critical. I like 1X's focus on the home. I like Wander's focus on the home. I could imagine having a Wander with a one accident.

1:32:05We got Sean McGuire himself. Welcome to the show. What's up team? I didn't wear a Counter-Strike t-shirt this day. I let you down. Sorry. You're still looking good. It's great. I'm not as good as you guys. And whoever, that lady that, anyone that comments on your hair is just jealous. Yeah. You guys are very good looking men. Everyone on the call has good hair. but I mean it's been a rough week. Sequoia is only making like a few billion dollars these days off of these acquisitions. What are you going to do to turn it around after the Wiz acquisition kind of fell so short of expectations? Yeah you know it's been a tough one you know five years after investment.

1:32:47Pretty mega outcome. What are you going to do? Congratulations. Breakdown. uh i'd love to hear the the quick highlights of meeting the team and and how that that investment came together and then what you think uh from your view how they were able because we talked about this yesterday the whiz team the reason they were able to get such a tremendous price or one of i'm sure multiple is because they just were growing so quickly and getting so much traction that they didn't need to sell so it's you know they had infinite optionality but how do you think they pulled this off? So on the team, I mean, Gilly Renan and my partner, Doug Leone, get all the credit.

1:33:31They are both absolute legends. So the backstory there is, you know, Sequoia used to have Sequoia Israel. Gilly was one of the three partners there. Gilly's an insanely talented guy, and he started his own fund called Cyberstarts, which we seeded. And early on, meaning like Sequoia invested in his fund, which we don't do very often. And Gilly called up Doug, said, I have the next one. And it was Asaf and the team. Doug pulled like four of us into a rapid fire meeting. I was in that first meeting. and I mean to be very honest the learning I personally got from watching Doug operate here and like getting to see like a phone call from Gilly of I've got the next one with these crack like crack team to multi-billion dollar gain five years later like it's really hard to explain how much learning goes into that but I think there is a lot of really interesting stuff from the beginning here.

1:34:42And so this is my recollection. Different people have different recollections. But basically, Doug got the call, set up the meeting. Four of us joined from Sequoia. The team had, it was obvious how insanely good the team was. You know, they had sold their last company to Microsoft and they're basically running cloud security there. And they had a very strong point of view on what the problem was. The problem was cloud security. no one had solved cloud security they had very they had like an extreme articulation around the problem but they didn't really know how they were going to solve that problem at the time and so they had they had a really clear insight into the wedge into the market which was mapping that basically people don't even know what assets they have in their cloud environments and so the first thing they're going to do is they'd figure out how to map people's assets kind of outside in So you can tell a customer in a first meeting, there's everything you own, you know, and therefore these are vulnerabilities.

1:35:44But the original idea of how to solve the problem after that wedge in was like basically a networking solution, like a zero trust networking solution. And so it's, I wouldn't say it was a pivot because it was, they had identified the problem they wanted to solve. But the actual solution changed dramatically in the first few months. um and so you know people talk about like market verse team this was a market and team but i think it's interesting how like the idea changed so much in the first few months um and i i think but digging in a little bit more you guys made the first investment was it 2020 or yeah it was It was called January, February, 2020.

1:36:32Okay. In 2020, was the average venture capitalist believing that no one had solved cloud security? Or is that something that you had to really be in it, running it at Microsoft to realize that it wasn't a solved problem? Because, you know, I think the market was reacting to the news saying, wait, does Google not, did they not have a coherent like cloud security? Oh, they didn't think about security at Google? Like this, that's why they did this deal? What was going on before? but yeah was it was it yes it's a really good question and it's funny i mean i personally have like an extreme background in this space sure i had started a company called expanse originally cadm a long time ago started in 2012 and to be very kind of like we were a precursor company to wiz like basically directly and we started off in an on-prem era and so doing like the mapping of on-prem networks from the outside in and like our primary value proper like our sales wedges we would show up and we already knew people's networks and their vulnerabilities when we would show up um and so like i personally had a prepared mind but i i think very few people there was this extreme skepticism of the cloud has been around for 15 years why like why is cloud why now like why is cloud security not solved um but i think to anyone that was like a practitioner it was clear it was not solved at all.

1:37:56And I think the lesson is that, like the way I think about it, the cloud penetration was still very, like, very low in call it 2015. If you look at like total percent of like compute in four to five hundred companies, I don't know what it was in 2015, but it was probably like 5 % or 7 % or something. That'd be my guess. And by the time you got to 2020, it was a much bigger fraction. And so it's like, I think we had just flipped where customers and buyers in their heads, if only like 5 % of your network is cloud, you care more about securing the on-prem than the cloud. And if you're a second class citizen, like you just doesn't really get done.

1:38:41By 2020, cloud was like the first class citizen. It was by far the most important thing to secure. And no one had, And everyone before had had us, including my own company, like we started with an on-prem solution and we started to bolt on a cloud solution. And our cloud solution wasn't very good because that's not how we started. And so to come in and only do cloud, that lets you have a way better product experience for the cloud. And they just, they entered the market when it was, you know, call it maybe not in terms of total compute, but 40, 50 % of the mindshare in an org had become cloud.

1:39:18And then they were able to grow with that as it went from there. And so it's just that something can happen like the cloud can get created, but it may not be the right time for to build like the cloud security business for another 15 years. You have to wait for maturity of the market and all that. And I think they just timed the maturity perfectly. And then the last thing is you you need to solve this from the outside in. Like you can't it. Microsoft can't solve this themselves. You have to have a solution that is kind of looking at all clouds and looking at the entire industry because people are multi-cloud.

1:39:54They work with multiple vendors. And, um, like, I, I think that this has to be, you have to have, with like very much came with the, the right approach for that time. That makes sense. Can you talk about Kela? Got announced a few days ago, I think five days ago. Very high profile round. I heard about it, I think, last year at this point. So they're probably already getting preempted on the next one. But talk about the team there. How quickly did you know that you wanted to back them? I mean, basically, we're killing it in Israel, or maybe the wrong language. We're investing very well in Israel.

1:40:35um anyways so kella my partner david khan led the investment and i'm his wingman there um kella's another amazing team we have known kind of one of the two primary co-founders alone drawer for quite a long time he he was an absolute legend you know one of the things we've been doing in israel is and actually like let me make a bigger point about israel one of the things that I think is very unique about Israel right now compared to most other places. It's much easier to concentrate talent in Israel than it is as like a Stanford spin out. Let me unpack that. If you go back in time, basically every great company I can think of in the past has done a phenomenal job concentrating talent.

1:41:27You know, if you think about Palantir, like they got all the best people out of Stanford in a few year range. If you think about Google, like they got all the best people, you know, 10 years prior. And after the dotcom crash, they went and acquihired a bunch of the best teams. They brought in Jeff Dean and like they scooped up a bunch of the best talent after the dotcom crash. If you think about, you know, PayPal, obviously the PayPal mafia, like they had concentrated insane amounts of talent. spacex in the early days like anyone in the world that wanted to work on rockets like there was only one place to go and they went to you know spacex and the best companies concentrate insane amounts of talent early on for a bunch of reasons i think it's become much harder to concentrate talent spinning out of like stanford or harvard or wherever than it used to be i mean one like to To be very blunt, one is these universities have become, they basically lost meritocracy and they lost, there's great inflation.

1:42:31You don't even know where you stand relative to other kids. Harvard last year implemented their first ever remedial math because there are people coming in that don't know algebra because they dropped the admission standards. It's the truth. It's crazy. They dropped the admission standards so much. The people coming in are no longer as good. And then there's great inflation. So you don't even know who the absolute most crack people are. If you go back to like, call it the 80s and onwards for a while, Harvard had this insane math class called Math 55. Math 55 was legendary in the math community.

1:43:07It's like, you know, probably 50 % of the people that even finished the class went on to be math professors. it was something that you would basically learn like a whole undergraduate math curriculum in one year so you could just do graduate classes and research after is that is that class like yc where the if you enter into it you're kind of doing it for 12 hours a day type of thing is it that intense or is it it's it's the only it's the only thing you do when you're at harvard like if if you're in that year. It's like Bill Gates actually did Math 55. And so did a bunch of the other kind of Microsoft founders.

1:43:47The fact that they did Math 55 and survived as, say, computer-oriented people rather than pure math people, and that they went and started a business, that calling card let them recruit anyone from Harvard, like anyone they wanted would go work for them just because people knew how smart they were because of math 55 um it's like these things are actually very important as like signals to other smart people that this person is on a level above me and so therefore like i should lower my ego like i was not able to finish math 55 you know you know some hypothetical person like tries math 55 gets absolutely smoked weeded out in the first week and then you know bill gates crushes it and And so they want to go work for him.

1:44:34We don't have that as much anymore at Stanford and Harvard, et cetera. There also just weren't as many companies getting formed back then. And so the ones that actually did get formed, I graduated college in 2007. Facebook was the hottest company in the world when I was an undergrad. And at the time, I think Zuck is probably two years older than me, there were basically no startups coming out of Harvard at the time. And so like everyone that was good that would consider a startup or was technically brilliant, like they would just go recruit them. Now there's like 50. And so the talent gets spread across all of them.

1:45:13In Israel, there is still this insane concentration of talent. And it comes from this is my weave. This is my Trump weave coming on. there's this insane concentration of talent that comes from the fact that because everyone goes into the army there's extremely rigorous selection of people for the army and call it from an intellectual standpoint there's like 60 slots for the most prestigious best things and there's like extremely rigorous vetting to get those slots and so the people that go do that are already kind of selected on a totally different level than those other people. And then out of those 60 people, one or two will emerge as like the apex, you know, alpha men or women that just do insane work and are geniuses and everyone else wants to follow.

1:46:08And so when they come out of the army, they are really able to concentrate talent in a way that is basically impossible if all you've done is gone to a school that has like if you know if you've gone to school that has pass fail grades and and your admissions like process is basically non-meritocratic and like an essay um and so anyways like with kella i mean if you go back to Wiz, like the Wiz founding team were absolute legends, like psycho level legends in Israel and therefore able to concentrate insane talent in the first couple months of the company. Like basically day one, they hired 20 people that were ultra elite.

1:46:56And it's just like when you're that good and everyone knows it, you can bring in these incredible people from day one and kela is of this mold as well um you know like a lot of people know what vcs are now learning what tal piot is tal piot is kind of one of the most elite forces in israel it's people people that have extreme aptitude in mathematics physics and leadership ability um and so three of the four whiz co-founders were tal piot um alon juror one of the kela founders was also tal piot and so like There's the the Telfiot mafia and he's especially highly regarded there. And so anyways, they've done an incredible job concentrating talent and, you know, alone teamed up with this woman, Hamutal Marador, who complimented him perfectly.

1:47:50She'd been at Palantir for a long time and just like really understand. obviously when you're working, when you're a defense tech company, you need two things. You need to build great technology, but you also need to be able to sell it. And you need to understand like government sales, government procurement, and a loan is a genius at building great technology. And Hamutal is a genius at, you know, selling it and navigating government relationships. And for what I think both Palantir and Andrual did this unbelievably well. They kind of established this playbook. Well, related to that, what is your take on the latest continuing resolution.

1:48:24It seems like there's not this massive increase to the defense budget that some, you know, defense tech startups were hoping for. Maybe there's money that's going to shift around. But what is your advice to maybe young defense tech founders that are hunting for that first program of record, looking for some government money in the new era? It's so crazy that we're having this conversation. Like you would have told me 10 years ago that someone's going to say in like a live podcast, what do you say the young about is hunting for a program of record? That language, you know, this was like you are an alien 10 years ago.

1:49:04Yeah. Look, I would say to the young founder that's hunting for a program of record, only one or two of you a year are going to do that. And it's going to be like of new companies. And it's really hard. And it takes both having great tech and great, you know, government BD. And so don't underinvest it in either. Yeah, it's interesting. It used to be extremely difficult to raise venture capital. Now it's seemingly very easy to raise venture capital. The hard part is in this category. And I want to hear your take on dual use. There's a theory that we were kicking around yesterday talking about, well, maybe you're better off if you're a dual-use company.

1:49:52We talked to a satellite company, Albedo. Obviously, they do imaging of the earth at 10 centimeter scale. That has military applications, but that also has commercial applications. So if the DOD money doesn't come quickly enough, maybe they go sell it to hedge funds and oil and gas companies. Do you think there'll be a shift in VC or defense tech VC towards, I want a little bit more of a dual use story earlier just to hedge against defense budgets?

1:50:21So it's kind of crazy that you're asking me these things because the company I started was a cybersecurity company that was basically a worse precursor to Wiz where it was dual use and about two thirds of our revenue is from the US government and one third was enterprise. um i said it's like it's these maximum two sets of overlap of the threads you're asking um i think i mean like with our company everyone told us you cannot be gov only it has to be dual use that's what every investor told us every expert and so therefore we did it because we wouldn't have been able to raise money otherwise but i think dual use is kind of a mirage like it's it can be great but i think you have to i think we're entering an era where investors are okay with just government sale companies single use and i think you just have to do what's best for your company and what's best in any given moment if it's natural for your company to be dual use because the product is basically the same in both you know enterprise and gov then do that but if it's if it's going to like really cost you on one side to do the other then i would just not do it early on and like palantir i don't know i was never in the building at palantir i don't know the story that well um but my kind of my understanding was that early on they had way more pull with the government than with enterprise and but like they tried to do both.

1:52:02I think with Foundry, there were different points in time where they had way more pull with the government than with enterprise and times where they had more pull with enterprise than with government. I think there was pressure on them to always be doing both. And I would just say, lean into wherever you're getting a lot of pull right now, but don't close the door on the other. Yeah, it depends on the product. I mean, obviously, Microsoft Teams is ITAR compliant, right? Like, is it a dual use technology? Yes, I guess. But then if you have C4 on it. They were like, Windows 95, whichever ones are still certified to run.

1:52:32At least when I was in the DoD, the most current operating system was from the 90s. Yeah. Crazy. There was allegations in a lawsuit of corporate espionage earlier this week. I don't need you to or want you to comment on that incident, but do you think that corporate espionage is a sort of potentially broader issue in Silicon Valley, something that needs to be taken more seriously? or is this just sort of like a one-off sort of crisis? Oh, man. Well, I think that Elon was right when he said the most entertaining outcome is the most likely. That's just been true on every level. It's like second law of thermodynamics.

1:53:20Look, I don't have a super strong point of view on this, But I'll just say I think that nation state espionage in Silicon Valley has been much, much bigger scale than people have understood for at least the last decade and probably beyond that. and you know delian yesterday whenever i think he's right like if you're if like if if you're a hardware company just go try to compete on the merits of the hardware and obviously do what you can to you know protect your ip ip and data assets and everything but like at the end of the day in hardware you're going to win on the merits of the product um on the software side i think you have to be a little bit more concerned but it's just in in hacking there's this expression you want to be a target of opportunity sorry you want to be a target of choice not a target of opportunity meaning like if some nation state says we are going to hack this company like they can hack anyone but you don't want to be like the slow pack animal that's just like the target of opportunity You're the slowest gazelle.

1:54:31It's taken down by the North Koreans that are stealing your crypto or something like that. Exactly. X, the everything app? Well, yeah, I'd love to give you another victory lap on X because I think last time we came on, it was rumored that there was this new announcement. But before that, could you talk about what's your sort of takeaway from the incident with the NASA astronauts? We're very happy to have them back here on Earth with the dolphins. But, you know, is there any learnings that you think, you know, that, you know, the space industry should be taking away from that broadly and, you know, NASA in general?

1:55:06So I might have mentioned this guy before, but one of my closest friends from Caltech, his name is Casey Hanmer. He's a brilliant guy. He's a, you know, prolific blogger. Love him. Very, very smart guy. Yeah. He has been saying for many years that this is not what he's been saying. So I'm sorry, Casey, I'm making this more provocative than what you actually said. But he's basically said that NASA has been underestimating SpaceX and that it's in NASA's interest to kind of understand and anticipate just how fast the progress of SpaceX is. And what he actually said is that they're underestimating Starship and that Starship is going to really change what's possible in the future.

1:55:54and that NASA has been still designing missions with the constraints of 10, 20 years ago, which is when launch costs are in the limit infinity and there's very few slots per year, then the economic rational thing is to spend close to infinite money making sure that your satellite works the first time because the launch cost dominates in the return math. uh infinity divided by infinity or whatever but you know if you have any any large constant number divided by infinity um is zero so anyways like they've been had this state of mind that launch is precious there's it's it's infinitely expensive there's very little of it i think nasa needs to get in the state of mind that launch is becoming abundant you know in the future it's going to be in the limit going to zero like like literally if you go 20 years from now i think that i mean elon has said that the forecast for starship or something like 20 a kilogram or something like that and you just feel a hundred thousand basically yeah used to be a hundred thousand dollars a kilogram and so i just we have to get in this mentality that like spacex is not spacex is not just Elon.

1:57:14SpaceX is an incredibly well-run company that has a very diverse set of leadership and very robust team, and that they are bringing insane capabilities to bear that will deeply, deeply benefit NASA. And we need to intersect the future, not the present or the past. I love it. Can you talk a little bit about, I mean, we talked about the X funding last time, but I want to know about X is clearly on the war path to becoming an everything app. We're basically running the entire show on X now. We have group DMs for how we organize the show and stuff. It's been a really robust platform for us. But I see that they're rolling out payments and all sorts of different features.

1:58:02There's always been this narrative that an everything app can can only happen in the East. It's America's not set up the world. It happened in China 10 years ago. Exactly. So can you lay us out, like, what are the hurdles? What are the milestones? What are the opportunities for X to become a really, like, really fully realize the vision?

1:58:24It's not my place to fully lay this out. I'll let Elon do that. He's pretty good at setting vision on things. but I think people are going to be, look, X has been underestimated the last few years and not by you guys. Like you guys are part of the small cohort of people that realized the eighties was a great decade and, you know, and that America is the greatest country in the world and that X was the place to be the last few years, but by a lot of the world has been underestimated. And I'm, I'm very optimistic about where it's going the next few years. And I'll, and I'll just say like, instead of saying the roadmap, I'll say the company has had to since to take private, there's been like a few years of like fixing the foundation of the company.

1:59:18And we're starting to enter the era where like the foundation is strong and they get to now like actually build on top of this new strong foundation. And so I think we're going to see, It's like the progress has been below the ground the last two and a half years. It's about to go above the ground, but we all see it. Yeah. A lot of the products that got built or rolled out were just things that had kind of been on the shelf and maybe were like not really launched for whatever internal political reason. Elon kind of got all those out the door. And I feel like the app's been working really well.

1:59:50The algorithm's been more satisfying than ever. I feel like I'm seeing really interesting content. So I've been satisfied. One more question. do you think M &A is really, you know, is the whiz acquisition, it still has to be approved from what I know, but is M &A, you know, really back on the menu? Do you feel like, you know, when you're talking to some of these later stage founders that are exploring, you know, thinking about the future and saying, does an IPO make sense? Does some type of strategic acquisition make sense? How are you thinking about this personally? I'm sure your general advice is just be a great company and grow really fast and you'll have a lot of optionality, but do you have a sort of feeling about where things are going?

2:00:33Not about whiz at all. My general kind of M &A view is I think there's two things that people are looking for. They're looking for guidance that things will actually be approved. And it's not just in America. There's also, for most companies, European regulatory approvals. approvals and that has been the bottleneck for quite a few m a deals in the last few years so i think it's like greater clarity on the global us and europe but everywhere kind of regulatory approvals and the second i think there's still like when i when i talk to bankers or anyone in the last six weeks there's a lot of macro uncertainty like people are very nervous about tariffs and very nervous about um you know like doge and kind of people don't want to go do a big m a transaction when the markets can change 20 30 percent you know either way quickly because it just you don't know exactly what you're underwriting um this happened with square and uh afterpay or whatever they bought afterpay for like 20 30 billion dollars some crazy number and then square was worth something like that like a year later you know it's just like um yeah look those are the two those are the two things i think if if we get clarity like favorable clarity on those two things then i think mna will rip um but it requires both well the new head of the ftc Andrew Ferguson is out doing podcasts.

2:02:19We'll have to have him on the show. Maybe you can join and we can put the screws to him and say, let's do some deals, Andrew. He's not coming on after that comment. You're not coming on. Anyways, thanks for having me, boys. Yeah. Thanks for stopping by. Have a great weekend. I've got to say, you guys are crushing it. Keep going. Absolutely crushing it. Thank you for being a part of it. Good man. Bye. Very cool. It's great. It's always difficult to get him in trouble with Sequoia regulatory. Yeah, that's the challenge of being an RA. Yeah, yeah. I mean, we're getting better at it. I think we should have a button.

2:02:54A cone of silence. We should have a button that we hit before. This is not financial advice. This is not financial advice. And then we have to beep each other because I lean into it so often because I think I'm just asking like, hey, do you think the Tesla is a cool car? And he's like, that's a public company. I can't talk about it. But still, lots of great insights and always a fun conversation with Sean. And speaking of Sean's, we're having another Sean on the show. Sean from Ridge. Is he in the temple? Oh, no. We got Connor. We got Connor. Connor's first. Hey, we got another Ridge guy. Surprise.

2:03:23We got Connor. So for those that don't know, I'm sure everybody already knows. So Connor and Sean are business partners and leaders over at the Ridge, dear friends of mine. Connor, I wanted to have you on for a bunch of reasons. One, because I knew you were going to dress for the occasion. Dude, of course. Looking sharp. Showing some respect to TVP. And a little fun fact, piece of lore for the fans. in our first launch video, when you see us having dinner and drinking wine, Connor was at that dinner with us. And he is pictured, he's the shoulder that you see us over. Fantastic cameo. Little cameo.

2:04:06Early, early Technology Brothers supporter for sure. Thank you. We appreciate it. And now you're on the show. Welcome. It's great to have you on. I wanted to get a kind of a market update on how performance marketers are thinking about the various platforms and planning for the rest of the year. we've lived in a world, you're also a young adult, but our entire lives have just been every single year ads get more expensive. So you kind of need to plan around that to some degree, but you're very plugged into the sort of e-commerce space broadly. There's challenges in e-com on the sort of tariffs side, but there's all, there's sort of this like sort of dual pressure.

2:04:47It's hard to get products. It's expensive to get products. It's expensive to sell them. Uh, maybe I'd love just sort of like a high level sort of like market update around how you're thinking about the different ad platforms and maybe we can get into like where you're finding an edge. Obviously don't give, you know, give away the stuff you were doing like, uh, nine months ago. Yeah, exactly. Yeah, yeah, yeah. Of course. No, perfect. So to take a quick, quick step back. Yeah. Ridge is a direct to consumer brand. Uh, as Jordy mentioned the last 10 years, it's gotten harder and harder every year.

2:05:16I think DTC acquisition has been like a war of attrition. Things get more expensive. You're reaching that new marginal buyer who's harder to acquire, more expensive. It's been a difficult environment to scale in as a DTC brand, regardless of kind of consumer sentiment. I think what we're facing right now, clearly what all the data is telling us is that not only are things getting more expensive, ad platforms are performing worse, there's restrictions on privacy, but I think people are spending less money. And when it comes to the business of selling minimalist wallets like I do, that's become increasingly difficult.

2:05:48So I've got two quick data points, one anecdotal, but there's a great service called d2cindex.com and they have something called the Direct Consumer Confidence Index. So it's like a stand-in for CPI, which has like, you know, they only take that snapshots of data sparingly throughout time. DTCCI is measuring the sentiment of consumers every single day. And on the 18th, or just a couple of days ago, consumer sentiment about the economy dropped to the lowest level since October 14th of last year to paint the picture of how are people feeling about spending dollars today? The second point that I have is from our contact at Meta who described the current climate for DTC brands, at least the growth oriented ones, as a quote unquote bloodbath.

2:06:28So that's my quick performance update is that is what we're working with. But I can talk maybe what we're doing to work through that a little bit if that would be helpful. Yeah, that'd be great. Yeah, amazing. What is working right now? So actually, with a little more Doomer news, and then I'll get into what's working. Consumer's tougher. That makes everybody's lives harder. On top of that, I think there's been changes within Meta that makes everybody's lives more difficult. And people like to poo-poo the importance of Meta, but it's like, you know, there's that stat. It was like 40 % of every VC dollar went into Meta advertising.

2:07:06It's like 30 % of all digital dollars spent, something like that. But so when meta is worse, it's harder for everyone. And right now we're at this point in time where it feels as if the meta platform in and of itself is not doing what it used to do. They began kind of weighting outcomes differently. It's become more middle and bottom of funnel to say it's serving to warmer and warmer audiences. And us as marketers or growth people, we want to be driving incremental results. Meta is harder to get that done with, at least in the way that it has always been. So that gets to what has been working.

2:07:43We've basically had to completely change our strategy. Real quick, Connor. Why is Meta worse? Is it stuff that they sort of need to do? Or is it stuff that they did and it was sort of the unintentional effect is that the ad product gets worse for advertisers? Like, why is it happening? and are your contacts at Meta saying, hey, we know this is not great and we're actively trying to get back to where we were or is it just get used to it, this is the new normal? Totally, yeah. No, some of the things are out of Meta's control. Meta's obviously gotten less efficient post iOS 14, which was when Tim Cook and Apple really put a lot of restrictions around what data did Meta have access to.

2:08:28At that point, you went from, as an example, being able to optimize for a 28-day outcome. So if you're optimizing for a purchase, that could happen over 28 days and Meta could attribute that purchase to itself. Now that's just a seven-day period, right? So now it's like a much smaller period. You have fewer or less ability to exclude the customers that you want. And Meta's began weighting these click-based outcomes. So all of those things together means Meta's only able to attribute orders to the platform on a shorter timeframe. There's less exclusions and it's serving to people who have already seen your ads.

2:09:02If you're trying to introduce new people to your brand and actually generate awareness, generate intent, and drive incremental orders, that's just a harder environment to do it within. And those are like, that's half things that are out of their control. And then part of the things that I mentioned are within Meta's control and I think they are trying to address. So the answer to your question, Jordy, would be a combination of the two. Yep, that makes sense. Anyways. I have a question on AI ads, not AI generated ads, but actual ads in LLM responses. Perplexity is starting to monetize by allowing advertisers to inject advertisements into, you ask Perplexity, what wallet should I buy?

2:09:42Boom, Ridge Wallet ad. People are proposing that OpenAI will do this as well in the ChatGPT app. Are you thinking about that? Will that be something that you're testing this year if you're not already? Well, I will say I just got off a phone call with the VP of growth at Ramp, George Bonacci. He wanted me to remind everyone that if you're looking to save time and money, go to ramp.com slash TVPN. There we go. Save both, thank you. Yeah, but no, we were talking about, we weren't actually talking about paid ads in perplexity. What we were talking about was SEO optimization within chat responses, which is not something we've done a lot of so far.

2:10:21It's one of the things as a more established brand, I think we immediately benefit from. Of course. There's already Reddit brands about you, right? And so Reddit gets baked into all the LLMs and you already pop up. Yeah, totally. So I don't think we have to focus on whatever you want to call that, like LLM SEO optimization versus someone else who's less established. But I think over time, as people hatch on to that as a opportunity, then we'll have to pay more attention there. But I'd be more interested in it from a quote unquote organic perspective versus the paid ads on perplexity. Okay, interesting.

2:10:53Interesting. yeah do you feel like uh the the the sort of e-commerce uh industrial complex like needs another great ad channel right now like it seems like throughout the history of selling products online like things have gotten a bit rough and then you know we got instagram or then we got reels or then we got you know tiktok or whatever and it just seems like in order to like keep the you know keep uh keep growing there always needs to be that sort of next platform um and could that be llms like right now i don't see a lot of from from my lens it's not commercially oriented searches happening on chat gpt people still discover products on places like instagram and then they ask chat gpt how do i make a good quesadilla maybe but it's not like there's not a lot of commercial intent there um but do you think do you see a world in which llms can be that next 10X ad platform?

2:11:52Or do you just think it's a different? Probably, I wouldn't say a 10X ad platform. I think the important distinction is there are certain brands and industries that benefit from these high intent channels. You are looking for a mattress or you are looking for insurance. They're the ones where as people discover those products through LLMs, that's probably a massive opportunity for them. How many people on a daily basis are going to be searching for men's wallet in ChatGPT, I don't think is going to move the needle on our business. What has moved the needle are these discovery channels, which was like when Snapchat was introduced or a TikTok or whatever else.

2:12:29How can we get out in front of millions of people and say, hey, we've got a better wallet than you currently own? They're supposed to launch ads in Meta's threads. So we'll hold out hope. Maybe that's the 10X ad platform. There we go. You never know. There's always a bull market somewhere. I love it. We had Kenan Davison on from Icon. His company helps DTC companies like yourself build and scale out AI ads. Not fully ad generated, a lot of repurposing content. Can you tell us a little bit about how AI is incorporated into the creative workflow? Who's actually doing this work on your team? it seems like it's probably still like a centaur model where there's a human working with an AI editor of some sort, but can you break down the creative workflow and how AI is impacting that right now?

2:13:20Yeah, awesome. And I'll start with, you know, from a performance perspective, I think one of the most important things we've been able to do is scale up our content creation. Yep. So those are like one in the same. We have two performance creative strategists on our team who went from manually concepting to writing briefs, to sending out to creators, to receiving that content, to editing it, to creating ads. We're trying to like truncate that all down via AI. So you can imagine the further upstream parts of the creative process, the concepting, the briefing is we're probably doing five, ten times faster and probably more with more novelty than we were otherwise, just because it's easier to ideate with something like we use Claude.

2:13:59Mostly we found it to be very helpful in that sense. um so that's really benefited the the ideating process um and a speeded up sped up that that uh that workflow quite a bit i'm a big fan of icon and canon um and they're a really cool example of once we've generated all of this content how do you go zero to one on like some new concept we have thousands of hours of content just laying around in google drive um so how do we repurpose that and kind of like elongate the value of that um and icon's been cool in that because it is basically an AI video editor. We can say, hey, we want a concept to appeal to 40-year-old men in flyover states, and it will put together a concept and kind of piece together and stitch together the content to do that.

2:14:42Got it. Do you have another one? No. I was going to make a joke about asking Siri to buy me a wallet with high-grade materials, lifetime warranty, and a 99-day risk-free trial. But I don't think Apple Intelligence can do it yet. But maybe Operator can. I don't know. I had one more. How are you thinking about sort of activations and stunts and things like that? Ridge is at a scale. Once you're doing, you know, hundreds of millions of revenue, you can start to think about, oh, should we sponsor a NASCAR team? Should we, you know, do this? You have a big partnership with them. A racehorse. Yeah. Jordy's thinking about getting a Bentley Continental GT Speed, and I thought you could wrap it with a Ridge Wallet logo and maybe help him with the payment on that as he commutes in.

2:15:27Yeah, that'd be great. You can have, you know, it'll just be$3 ,000 a month. Yes, exactly. No, but how do you think about these sort of bigger stunt marketing, and is it just brand marketing, or do you historically just see, like, how do you think about attribution? We're kind of gearing up for right now from a stunt marketing perspective. Each year we do a sweepstakes. So last year we did a 24 karat gold plated cyber truck that we gave away or a Hennessy Velociraptor. Yeah. So that's what we did last year. And I think each year we're just going to try to raise the stakes. That's kind of the name of the game.

2:16:00So what we're doing now is we're gearing up for that. Can't share too many details, but we'll have more cars, bigger activations. That'll be live in August. So everybody can look forward to it. I feel like the last one, it went really far because I think I saw MKBHD do something with it. But then later, like Doug DeMuro was auctioning it off. And I was like, we're now like four steps away from the Ridge guys, but I'm still seeing Ridge on all of this stuff. Like, how did this happen? Was that kind of intentional that you talked to multiple influencers and you say, okay, you're going to have it for a day.

2:16:29You're going to have it for a week. You're going to auction it off. Was that the plan? Yeah, no, totally. So that was a part of the plan. Some of it was serendipitous. So we had realized the year before, hey, if we can get the car in a YouTube creator's video, things just perform like three times as well, which is like no real surprise. So, so the game last year was just like, yeah, how do we coordinate getting one or both of these trucks in as many videos as possible? Uh, the serendipitous part was I had this, the Cybertruck here in Salt Lake and Jerry rig everything. Who has a very big tech channel, uh, tweeted, he said, Hey, does anybody in Salt Lake have a Cybertruck that I can use for a project?

2:17:03And we were like, Hey, we do. Um, and that's how we got into his 24 karat gold plating video. Uh, so that kind of started it and then we got it in a Marquez video. We had it all over the place. We made it in 2024 videos. Colin and Samir did an ad read in the truck, which was really cool. And then to top off the campaign, the winner selected the cash actually, so they didn't take either car. But we were able to auction off the 24 karat gold plated Cybertruck on Doug DeMuro's cars and bids. So it was a very YouTube heavy campaign, which was very fun. Is it tricky running these sweepstakes? Because I think legally you have to be, you have to say no entry required.

2:17:40Anyone can just write in and then people can kind of like batch mail in a thousand entries. I remember hearing stories about someone at Caltech in the very early days of the original photocopier figured out that McDonald's monopoly didn't require any purchase, no purchase necessary. So they dropped off like thousands and thousands of pages of like, I would like to enter the contest and they got like every single code back and then they changed their rules or something like that. But what do you think about in terms of like manipulation of these sweepstakes? Is that a risk at all? Or is it pretty standard these days?

2:18:13We use it. We use a third party legal team who like run sweepstakes professionally. So I think we're relatively buttoned up. You have to be able to mail in. You've got some free entries on the site. We are able to see some people trying to game it. We had this like, yeah, yeah. So we were able to take care of that. But otherwise, it's very above board. We're not doing any like sort of uh mcdonald's monopoly sort of schemes over here yeah yeah you can get in trouble if you're if you're running an unregistered lottery you want to stay away from that run a clean game last question i have because you're talking about a bunch of these different creators you're working with you guys have your uh mkbhd kind of like core partnership uh i grew up at a time like following the surf industry where every surf apparel company had like you know their core ambassadors and they had other people on the team and then they had the people that were trying to like you know uh you know just more like development side is there a world in the future where ridge has effectively you sponsor a ton of creators so you're just like spending money across all these different channels but is there a world where ridge has like a proper team of ambassadors that are just sort of rep like in a more serious way like representing ridge within industries helping with product development or is it the kind of thing that makes sense to do with like one tentpole kind of creator and then everyone else is just more commercial relationship.

2:19:33Yeah, I think it's a combination of both. I mean, we went from kind of the spray and pray approach. We've sponsored thousands of creators and billions of views. And now our goal is to just do deeper integrations with creators over longer periods of time. Marquez being the flagship example of that. But I would love to assemble an Avengers team around him of cool creators and celebrities. That's very cool. We'll reach out if you're that creator. Where can people find your podcasts? Oh, marketing operators. You can find it anywhere you listen to podcasts. Only weekly. So we're not putting out that much content.

2:20:09But well monetized. You guys would appreciate that. Yeah, you do have ads, which is great. We'd be very worried. We probably wouldn't have you on the show if you didn't have some ads. Are you guys going to be sponsoring the All In Summit? I know you've been running that back this year. That's the one place they allow ads. So it's a great place to be. But yeah, TBD still? tbd yeah we got a sweet deal on it last year if that comes about again maybe okay well good luck good luck thanks for coming on thanks for coming on connor we'll talk to you soon bye so what's that absolute dog an absolute dog uh what's the what's the word on sean is he joining or should we move on to some timeline i mean we can start some timeline and then when he's in the waiting room i like timeline he's coming in right now hot we got sean frank from the ridge wallet back-to-back ridge wallet there he is welcome to the show look at that microphone that thing is serious do you podcast dude i am so happy to be in the capital of capital the fortress of finance this is this is my my zen garden i do podcast i just want to say i was listening before i jumped on that last guest you had does not work at ridge wallet i've never seen him before just been larping he's got the linkedin set up he's got all the wallets everyone he actually works for a rival wallet company and he's been selling secrets on the side there's an alt i mean are you worried about spying at ridge no ridges had so many knockoffs over the years and from all different parts of the world there's an alternate reality where like 10 years ago like sean and connor like uh you know have a blood feud and then like connor goes and works at one wallet company and sean does the other and then like they're just always like the same because they're You guys are like yin and yang in terms of being good.

2:21:57Anyways, great to have you on the show, Sean. How's your week going? I'm good, man. Yeah, Connor is my rippling. So I'm dealing this scenario. And I'm going to steal all the secrets. Okay, that's great. The rippling to my deal. Fantastic. We want to talk about that. Yeah, I wanted to just have you guys both on to just get a high-level read on what's happening in e-commerce uh it's certainly hasn't been a easy start to the year with the tariffs i mean technology companies are are in a pretty good spot if you're just selling sass uh worried less about um the impacts of of all these different sort of policy decisions uh you know talk to us about how the start of the year is gone we had you on this you were one of our very first guests but i feel like a lot has transpired between uh then and now totally man and i changed my mic so hopefully this sounds better for you guys better thank you nice dude i'm reading chat on the on the right hand side so i'm here to support um dude the biggest thing about tariffs is just the uncertainty and the rollout so like we're friends with a lot of nine figure brands and everyone would like to bring stuff to america right but that is a that is a two to four year manufacturing timeline right ridge has been working on our us factory and our capacity for like two and a half years.

2:23:20And I can currently make 20 ,000 units a month. Okay. I sell 50 ,000 units a month. Right. And in peak, I sell way, way, way more than that. So it is just, I've not been able to keep up with demand and maybe in four years I could get there, but with all of the whiplashing on tariffs, it's very hard to know what to invest in. And what that leads to is just me hoarding capital right now. Like I'm not going to do distributions. I'm not going to hire anybody. And it's really this freeze because I don't know where the puck's going, right? We had tariffs come in, tariffs come out, tariffs come in, tariffs come out.

2:23:59Section 321 was stopped and now it's back on. It's just very hard to make a decision when you don't know what's going to happen in two weeks. what uh are you seeing situations with brands that have less of a uh you know that that have less of a sort of fortress balance sheet where there's like actually you know like i imagine there's certain brands that are kind of running the calculus of like are we even going to make it to q4 with how this is going uh what's kind of like the chatter in the industry yeah so there's been like five years of bullshit when it comes to d2c right like uh you know there was covid which was really good for some people horrible for some people famously away sales dropped 90 percent because people stopped traveling right um and then you have tariffs it's just the latest flavor in this you know there was yeah ios 14 issues and everything else what we see is a way credit cards going up you know it's gonna hurt consumers totally dude yeah i mean you're talking about credit cards uh brax very famously was an e-commerce credit card provider and they shut down all the credit cards when covet happened so that's why i'm so glad you guys work with uh ramp the better of the credit card providers um no so what we're seeing right now is a wave of shutdowns in smaller sub 10 million dollar brands right like that's always been a trend but it's really ramped up the past three months since Trump got elected because they just can't absorb tariff costs.

2:25:34Things were on the water to be brought into America, and then costs went up 25%, 40 % for these people. And when you add that in with everything that's happened, iOS changes, advertising changes, consumer being softer, there's just a wave of bankruptcies and shutdowns happening. So if you haven't secured financing, if you don't have a solid balance sheet, it's just a really, really hard time to be trying to sell stuff on the internet. Talk about solo brands. They're currently being priced at$12 million on$450 million of revenue. They're not profitable. I have to imagine this is a tariff thing, but we were trying to figure out what was going on uh with the company did you track this at all it's like i the the numbers just don't make sense to me what's sean is like sean's got his finger on the buy button it's like i could just buy the like the every every share they also chubbies it's like a pretty popular men's fashion brand too and they're doing like a hundred million in sales over there too so i know solo so intimately um i know spencer the original founder i know bertram capital the private equity group the bought them.

2:26:44I know Summit, the private equity group that bought them from the private equity group to take them public. They had a roll-up strategy. They overpaid for some assets and they've depreciated all of them except for two. So they have Solo, which makes the stoves and they have Chubby's and they used to not break out revenue. Last quarter was the last quarter they actually broke their revenue out. And what you have is Chubby does roughly a hundred million dollars in sales and is EBITDA positive. And then you have Solo, which is a shrinking business, shrinking 25 % year over year, losing$50 million or whatever.

2:27:18And the reason why the market kept so low is they have so much debt on that business. I think it's over$250 million in debt for a shrinking business that loses money. So they will sell chubbies that when you break out the finances like that, they're looking for someone to buy that asset to pay down some of this debt. And then And they're just a take private. It is just somebody will swoop in. Does it happen before or after bankruptcy? That's the whole challenge, right? Yeah, because you're not just going to pick that up for 12 million bucks. You're going to pick up$250 million of debt with it potentially.

2:27:52And that's a big decision. You got to be ready to do something with that, right? Refinance that or pay that down somehow, right? Yeah, yeah. I mean, look, the obvious suitor is Yeti. But there's a bunch of outdoor roll-ups. I mean, it's one side that's... Somebody, it makes sense to own that asset, but it's really, really hard to be solo stuff right now. Yeah, it's rough. Well, good luck to them. Do you believe there's potentially another ad platform on their horizons that will save the industry, swoop in and provide cheap ads that allow everybody to scale efficiently again? Everyone in DDC, just one more ad platform.

2:28:30Yeah, yeah, yeah. Just one more. Yeah, I mean, you guys have talked about this a bunch, right? Ridge benefited massively from the rise of just meta platforms and being able to buy cheap ads and scale very profitably. But what's your conviction level? Are LLM ad networks going to be a thing or are you short there? Well, they will find a way to monetize, right? I mean, Google is the most profitable, best business on earth, 80 billion dollars in in revenue or whatever it's all straight profit uh and it's all just people searching and then get in the middle of that so you know if you're chashie bt or perplexity you could probably build an amazing you know sales business on top of that uh but dude this year meta meta is working like last year meta did not work and we're giving so much of our money to the big blue beast and we're spending more today than we spent in december right um it's just because i think they're taking ai seriously and they're really trying to bring ai across their ad act like their ad networks they do have threads that's new ad space right um you know twitter is looking to highly monetize its ad space i think their daily users are going up famously there's reddit which has never been able to monetize well the revenue per user is dog so all we're hoping for is that ai helps people bring the power of the facebook ads engine to more places.

2:29:57We think Applovin did that in Q4, but just more ad space to be more higher powered. And unfortunately, if we're in a recessionary environment, the first thing that gets cut is marketing budgets and then Ridgewell swoops in to buy those cheap CPMs. So podcasts crushing it right now. It makes so much sense why Ramp, Bezel, Wonder, Public.com, AdQuick, Aidsleep are sponsoring this podcast because podcast that's for us crushing right now yeah i love it uh what's your take on i need to re-download threads i deleted it because i'm just so loyal to the everything app uh but uh do you are you using it at all yourself do you think it do you do you think it will be like if anybody could make the sort of like text heavy format the sort of conversational format uh be have good ad units it would be meta platforms um are you guys spending Can you spend on threads yet?

2:30:53Are you getting invited to spend on it soon? So I don't use threads. I'm trying to spend less time on the internet, dude, trying to touch that delicious sunshine that's been hitting my face lately. But, dude, never bet against Zuck. You give him pixels, he will monetize them. So if he's got users, he's going to monetize it. The rumor is that threads ads are coming in Q4 of this year. and with that they're also going to better monetize messaging and whatsapp in general so you know whatsapp still has 100 million users in america like if you're not logged in every day using it a lot of people are and they do have you know just dms and everything that hasn't been monetized so snapchat lost messaging ads last q4 whatever snapchat does meta will just scoop up and do it too so we got more ad units coming guys are you long are you long or short apple ever doing an ad platform you'd think they sort of like handicapped the american online ad industry uh it would have been nice if they had offered up like you know a stick and a carrot at the same time uh is there any you know if apple's entering this era of just like you know up toll road operations you know squeezing margin everywhere getting these sort of incremental fees do you see a world where app store ads yeah the app store is not much for direct-to-consumer companies if I'm correct.

2:32:17So my wife was interviewing for a role at Apple years ago. And when you interview at Apple, they make you do these presentations. And her presentation was the advertising opportunity at Apple. And the executives there were very much like, we're never going to do that. That is so against who we are. But then what we've seen in the past two years is that, no, they're actually totally. It'll be an ad exchange, right? So I don't think they'll actually monetize any of their ad space. They have the app store, right? They have Apple TV, or they have iMessage as a social network, I think. We all spend way more time on iMessage than anything else.

2:32:56They won't monetize it, but they will sell your data. And that was the whole iOS 14 breakdown, right? Is that Apple wanted to, they wanted revenue from Facebook in exchange for that data, and Facebook said no so they shut it down so it they will get a they will get probably 40 billion dollars in the next two years from just ad data exchange i think that's tracking that makes sense i'm curious ai tele telemarketers like they have your phone number so you pick up your iphone it's just ringing and it's just an ad on the phone hi this is sean frank here i was just calling to see if you were interested in your ridge wallet and it's just ai sean uh last last question uh are the are the various platforms treating you nicely enough?

2:33:38Are they taking you out to dinner as frequently as they should? Do you feel like you have, do you feel like they're, you know, you're a huge customer for them and client? Didn't Ramp send you like a huge like tombstone for how much ad you've spent? Has Meta sent you anything? No, dude. I mean, I think I'm at, you know, over a quarter billion dollars in Meta spend. So I'm waiting to get to a billion and maybe maybe they'll give me steak dinner you know maybe maybe just a cameo from mark zuckerberg being like hey man i appreciate all the work you're doing but no i did ramp ramp's a great partner i got a little tombstone from him i love it um you know snapchat is the in terms of like understanding and client relations i think they're best in class dude evan spiegel super involved in the ad platform i've i've i've had lunch and breakfast with him probably three or four different times And he's just like, how can we get these ads to work?

2:34:34That's all he cares about. So yeah, dude, love all of the network. Also, Shopify is the best partner out there. That's amazing. One breaking news story that I want to get your take on. DoorDash and Klarna signed a deal where customers can choose to pay for food deliveries in interest-free installments. There's a lot of chatter on the timeline about this. I know Ridge Wallet has Afterpay installed, Shopify integration. What's your take on paying for your Chipotle burrito over several years? Well, so the previous guest you had on, a good friend of mine, Connor, where you lived together. And when these things rolled out, he was so bullish.

2:35:17He's like, dude, I can smooth out my burn. He's like, everything should be financed, interest-free, everything. Take advantage of the Zerp environment. Surprisingly, we see a large percentage of our purchases go through Affirm. It's probably 15 % of all purchases are running through Affirm. So they do do serious revenue. There is needs from consumers. And I think people – it's probably more bearish for the credit card industry than anything else, like alternative merchant-provided financing eating high-interest-rate credit cards. Who pays for it in that transaction? a firm takes a higher payment processing rate than visa does so like that's how they're actually funding this whole exercise do i think people should have should be putting chipotle burritos on layaway i do not think that's a good purchase so that makes me very very scared and the memes for me it's such a contradiction because like leverage is awesome and then burritos are awesome so like you would think you putting them together would would be you know this sort of 10x experience but it feels very dark risky and uh what about uh like conversion rate effects for ridge when you rolled do you remember when you rolled that out was there actually a lift in in conversion or revenue that you could see or is it just something you kind of feel builds like a better customer experience over time when you roll out something like after pay so the reason why we did it is because you know at one point not that long ago 2020 2021 e-commerce was the hottest industry everyone was rushing into it the glory days um all of those providers would pay you money to to actually add it to the website so i think it was either clarna or a firm gave us fifty thousand dollars to have it as an option on that and yeah also i mean ridge's product portfolio has grown a lot like you could easily wind up checking out with you know a whole christmas gifts of luggage and wallets for a lot of people wind up in the several thousands and at that point you know yeah doing something yeah yeah i mean if you know everyone listening is probably billionaires you know multi-billionaires but if you need to get gifts for your staff rich.com slash sean use code sean for 10 off there you go guys there we go sean i love you uh good luck in the trenches and uh hopefully there's not news in the next week that is so dramatic that it requires us to call our e-commerce uh correspondent but if there is expect a call.

2:37:40You know what? I would like to go on your guys' payroll as the e-commerce correspondent. I'll get a whole outfit and I'll just, I'll be out there in the warehouses telling you what's going down. So I appreciate you guys. Goodbye. Well, I don't know about payroll. I mean, we're trying to be the most profitable podcast here, but we'd love to have you on. Yeah, we'll do it if you quit. We'll do it if you, if you quit your show, if we can buy, if we can acquire, if we can acquire your show, we can, we can work out a deal. You don't have to do, All you got to do is turn on Zoom. Yeah. There you go.

2:38:09I was going to pay you guys. Oh, now we're doing deals. Okay. Now we're doing deals. Yeah, this is the Klarna firm strategy. Yeah, you can pay over time. Great to see you, Sean. Great to see you. Bye. Our new studio, if it goes where we think it's going to go, will be much closer to Sean. Oh, fantastic. You can just pop by. You can just pop by. That'd be great. Drop in. Well, should we finish up with some timeline, wrap it up, and get out of here? because we actually got to see some new studios in 20 minutes. And I think they're about 40 minutes away. So we are fully screwed. Anyway, there's some new poly market.

2:38:42Very exciting. Will Jesus Christ return this year? What do you think, Jordy? It's a 3 % chance. Are you long? Are you short on the return of Jesus Christ? I don't feel ready to make a bet. Although I would like to talk to the 3 % that are going long and just try to see if we could get some insights. Yeah, I bet the comment section is very valuable there. We said we don't talk about politics, but we never said we wouldn't talk about religion. Fantastic. Anyway, let's move on to LinkedIn has discovered loot boxes. Kevin Kwok shares that jobs are being recommended that are just some from stealth startups.

2:39:25So you apply to the company. And there's two jobs that look identical. as chief operating officer at a stealth startup and chief operating officer at another stealth startup. And so you click, you apply, you might wind up at the next Decacorn, you might wind up at something that's bankrupt in six months. But it's a lot of fun. Speaking of unknown stealth startups, I have a portfolio company, Stealth Robotics Company. Is that the name of the company, Stealth Robotics? Because that's a good name. That'd be a good name. I mean, why not? It's not. So they're coming out of stealth. They're going to be coming out of self later this year, but they are absolutely ripping and in a very interesting category.

2:40:05And that's really all I can say, but they're hiring for a ton of different engineering roles. And if you are in the market to join a robotics company or you want to learn more, DM me on X. I will connect you to the team. Well, we got some quick hits because there is more news that I want to make sure we cover because we'll be going deeper on these stories next week. first off we didn't get a chance to talk to Sean about this but Sequoia Capital has stepped in and backed Elon Musk in his Delaware battle a comment from Sequoia rare they say Delaware law should not subject founders to heightened scrutiny for being an asset and benefiting to all and benefit to all stockholders and so if you haven't left already leave Delaware is the comment from the account leave Delaware and so I want to get I want to go deeper here.

2:40:55I want to know exactly what it takes to leave Delaware. How many companies are actually moving, where they're moving to, the Texas stock exchange, all these different things that are going on. Isn't it? I want to know what's going on. Something crazy, like half of Delaware's like tax receipts are from. I think it's more than half. I think they, I think the state makes like all of their money. So I want to see, and didn't this, I'm pretty sure that the governor was like going on television and kind of mocking. So anyways, Anyways, they got to really turn this around. We'll see. Unless they want to be relegated to obscurity.

2:41:29I always wanted the vacation in Delaware, the home of the C Corp. Oh, okay. Just because I just love business and I respect the, you know. If they're going to have a Hall of Fame of business, that's where it should be. The biblical home. Yeah, yeah, the Hall of Fame. Ancestral home of the corporation. The business Hall of Fame. In Delaware, we should build it. Let's go to Shiel Monat. He says, exit mania is upon us. $2.6 billion exit for Next. Exit Mania. Exit Mania coming soon. Like WrestleMania. Yeah. Yeah, we got to have Shiel on to talk about Exit Mania. So Next Insurance, the rumor is that it was 8x revenue, 14.5x 2024 gross profit.

2:42:10They got scooped up by Munich Re for$2.6 billion. Congrats to them. A little size gone moment for the folks over at Next Insurance. You'll love to see it. Lots of M &A stuff going on. Let's also move to more news about Apple. We've been talking about the Apple intelligence delay on repeat for the last few weeks. Well, now they're getting sued. They're facing a false advertising lawsuit over Apple intelligence delay. Yeah, you never know how much to read. This is a pretty wild ad. You never know how much to read into this kind of lawsuit because you can just sue anyone or anything for anything at any time.

2:42:45So this could just be a money grab. I mean, it could literally be like some class action settlement where everyone gets 75 cents, but it's bad press and you know Apple hates bad press. So they're shuffling executives around. We covered that yesterday. And I'm sure the folks at Apple are thinking about how to handle this crisis. They probably need to call Lulu, who will be on the show on Monday. Anyway, Gary Tan, he says, this is the golden age of building. He shares some news from CNBC. Why Combinator startups are the fastest growing, most profitable in fund history because of AI. You think, did CNBC get this scoop from us when Gary was on the show?

2:43:21Yeah, we'd like our scoop. Attribution required on everything we say. Although, who knows if we will give you attribution when we cover you. We'll try. We'll try. We'll do our best. We'll at least do a sponsor acknowledgement. Yes, definitely. Definitely. Yeah. Who's advertising on this CNBC landing page? We'll shout them out. Anyway. We got some great math by Christian Kyle. this goes viral every time he posts it it's insane he just knows how to play the hits so well my three-month-old son is now twice as big as the day as when he was born he's on track to weigh seven and a half trillion pounds by age 10 great uh and it's awesome that this is definitely this is the first time his his uh his son has been on tbpn but i'm sure he's going to be an absolute Chad, hard tech founder someday.

2:44:12We'll be interviewing him by the time he's, you know, at least a teenager. So he posted this once on X. It got a hundred thousand likes easily. He just posted it again, got another hundred thousand likes. It's made its way over to Reddit, become the front page of Reddit over there. People love math jokes like this and exponentials. Very fun. What else should we cover from the timeline? Saquon Barkley is in Anderle now. That's exciting. He says, thank you to Paul. Hit the gong for that. And the entire Anderil team for having me out couldn't be prouder to be an investor. I mean, a lot of people wore Eagles gear at Anderil headquarters that day.

2:44:50That's a lot of fun. Saquon, pull up the Founders Fund portfolio page and then just DM every single CEO. Because if you look at Founders Fund performance, uh arthur rock uh leaked it and uh he was quote quoting harry stebbings who earlier this month says uh i've never seen such institutional demand for a fund than the current demand for founders fund growth fund and the reason for that is um they are putting up incredible numbers and i will say this because john can't comment can't comment but uh i can comment and uh this is the kind of performance that you're pleased when it's leaked. So inspiring to the whole community.

2:45:34Yeah. So Saquon, go hit up the FF portfolio, get in however you can. Um, we got a post from Jason Levin. We'll close it off here. Uh, Jason says when tech crunch gets acquired by a PE firm to be chopped up for parts, this is a very creepy deep fake. It's pretty good. Is that there's a little bit of me in there and is that it's from the shining oh it's you it's me as jack nicholson in the shining breaking through the wall with an axe because he's gone insane i think that's the story of the shining well yeah we love private equity and we love compare it on the street we love private equity we love when uh companies get bought by private equity especially when they're potentially you know competing for attention and i mean if you're the private equity firm that bought it we have a genius idea to turn it around we've said it before turn it into a lifestyle magazine about skiing that's how you get the capital allocators back on board and that's a great way to leave it we should we should have the new we should go skiing right now we should go skiing with the acquirer and break down the plan the plan um to turn tech Thank you for tuning in today.

2:46:48It is a pleasure to do the show. We're pretty bummed it's the weekend. It's not. Normally 21 hours and we'll be back. 21 hours. And that's what I think. Just 21 hours. And now it's like almost 72 hours. It's 68 hours, 70 hours. We'll just be brooding. It's going to be rough. But we'll get through it, folks. The timeline's always there. We'll still be posting. We'll be posting clips. Follow us on X. Review us on Apple and Spotify. And enjoy your weekend. Thank you. Thank you.