Silicon Valley vs The Vatican, Bryan Johnson’s Shroom Trip | Soren Monroe-Anderson, Jeff Miller, Kaz Nejatian, Paul Needham, Jordan Nanos, Isaiah Taylor, Hayden Adams, Grant Lee

29:38You think of them as like, you know, it's, but it's like, he's talking about 1996, which is like full five years before the bubble pops. And like there, and it's clear, like 1996. They were in a browser war. It's like hot. Yeah. Like the browser wars. It's like a hot period. It's March 5th, 1996. they're at a level where they're doing strategy review with computer reseller news and doing press around this thing. Do you have any idea what was going on at the time? Okay, so I believe that it was... So 1994, they say Netscape is free for non-commercial use for everyone. Okay. And then this press release was that it's only going to be free for academic and nonprofit use, not just all consumers.

30:24Okay, so if you're a consumer, you'd have to buy it? I think so. That's such a crazy thing. But yeah, I mean, yeah. Yeah, such an interesting time. One browser, please. One browser, please. I mean, I told you, you used to get AOL on a disk. You probably needed to pay for your browser. Just walking into the browser store and buying one browser. Okay, we need to get more details in exactly what was going on here and what the strategy was. and then uh i when did they didn't they ipo in like 1999 or something when did netscape ipo because the uh oh 1995 so august 9th 1995 they ipo'd and then this is 1996 and so they're they're already a public company in 95 and then like the bubble just keeps inflating for five years while the internet grows and grows and grows.

31:21What a wild, what a wild time. Uh, talk about being early to, uh, to a boom. They did about 16 million of revenue in the first two operating quarters of 1995. That's great. That's really, really, uh, really, really crazy for context. That's like 1.6 billion in today's dollar after, uh, after the new round of stimulus checks, 50 year mortgages. Yeah. We got to get to that story. There's so many more stories we got to run through. Do you think the Pope actually used AI to generate this? Because Sowers here is saying the Pope is posting fully AI generated content about AI. And this is the Pangram AI detection result.

32:01I've also noticed that a very funny gag is to just fake one of these screenshots, which is very easy to do. And so if somebody writes something, you can just put it in here, say that it's AI generated, post that, and then you're like, owned. So this screenshot is making a claim that because it said technological innovation can be a form. Yeah, I don't know how good the AI generating detectors are these days. Also, I wouldn't be surprised if the Vatican is using AI to translate. And I wouldn't be surprised if Pope Leo is speaking in his study. In Latin? Somebody is in Latin. Someone is recording it in, you know, with the, you know, physically writing it down.

32:48Yeah. That is being passed to somebody who then puts it into a word processor and uses AI to polish it up a little bit. Oh, there was one interesting anti-Pope take, sort of anti-Pope take from another. I will say, I will say, I think this whole, the whole Marc Andreessen Popegate debacle is a lesson that everyone can take. don't mock the Pope. Just don't. Don't mock the Pope. I think the blowback was fierce and almost instantaneous. Don't mock the Pope. Get the Pope on Vanta instead. Vanta, automate compliance, manage risk, and accelerate trust with AI. Vanta helps get you compliant fast, and we don't stop there.

33:31AI automation powers everything, from evidence collection and continuous monitoring to security reviews and vendor risk, whether you're starting up or scaling. So from the Peter Thiel Antichrist lectures, there's a segment on the Pope. And I thought it was interesting because it's not the most pro-Pope take. I don't know. It's one of these things that's like complex and you kind of got to read through it to form a full opinion. But let's read from this quote that came from The Guardian and is apparently based on some leaked audio. But Thiel says that he is very pro J.D. Vance, but he has some concerns about his allegiance to the Pope.

34:08The place that I would worry about is that he's too close to the Pope. And so we have all these reports of fights between him and the Pope. And I hope there are a lot more. It's the Caesar-Papist fusion that I always worry about. By the way, I've given him this feedback over time. And you know, with the sort of, I don't know, I don't like his Pope-ism, but there's sort of a way, if I steel-mand it. As always, you have to think about whether if you say you're doing something good, whether it is a command, a standard, or a limit, or whether in philosophical language, it is necessary or sufficient.

34:51And so when J.D. Vance said that he was praying for Pope Francis's health, it's as a command, as a necessary thing. Okay, that's, if you're a lot more, if you're a good Catholic, it's really hard to read this. Because of the way that he talked. The transcription. But what I hope it really means is that it's sufficient and that he's setting a good example for conservative Catholics like you. Peter, he's talking to Peter Rosenthal, I believe, who listened to the Pope too much. And perhaps all you have to do to be a really good Catholic is pray for the Pope. You don't really need to listen to him on anything else.

35:28And if that's what J.D. Vance is doing, then that's really good. I'm worried about the Caesar-Papist fusion. And so it was very interesting to hear. The whole conversation had collapsed to the point where it was like, Mark Andreessen is just blanketly anti-Pope, I guess. And everyone else in the timeline, all the Anons are like pro-Pope broadly. and I just was remembering this quote from PT that was like way, way more nuanced, like way more nuanced. Just like it is important to pray for the Pope, to support the Pope in that way, but there is a risk of elevating the Pope to the point where you're listening to everything he says and that's not necessarily what PT thinks is like the correct way to live your life, I suppose.

36:17Did you have any takeaways from when you read this, Tyler? I mean, I think the interesting thing about this is actually, um, it's that he's basically saying that JD Vance is like Caesar. That's kind of interesting, uh, opinion. Um, but I think, uh, PT has been like anti-popes for a long time. Like he, there's, he had this thing where he was like, oh, the, the two word, um, uh, argument against, uh, Catholicism is like, uh, Pope Francis. Sure. He's like really anti Pope Francis. It was. Yeah. Um, so yeah. There was the Pope before this one who was like decried as like an environmentalist. Like when we read a piece in the Wall Street Journal and that was the critique.

37:00The critique from the journal was that the previous Pope was anti-business, anti, was decel actually. That was like sort of the christened. With a crazy P-doom? With a crazy P-doom. Not quite, but just that, you know, over-rotated on the environmentalism issue. and maybe put some things at the, like, you know, put some things first that maybe shouldn't have been. What did Will Manitis have to say? As the West abandons capitalism, it is incredibly hopeful to see the church embrace it. The impulse of liberation theology was correct. Christ's ministry is of and for the poor and it failed to provide a solution to lift the globe out of poverty.

37:42Capitalism is that solution. always talking about the business is business let me tell you about Graphite.com code review for the age of AI Graphite helps teams on GitHub to ship higher quality software faster, yes? I never would have expected the Pope to post business is business in any context but I'm glad that he is has the Pope ever done a money spread? that's what we need to get to the bottom of the tallach here is saying I'm loving this arc of the Pope engaging with 21st century themes and offering simple but correct and meaningful advice. Yeah. And he's quoting the media post. The Pope was on a tear, three back-to-back bangers that really like broke through.

38:24Growing Daniel had found an interesting programmer saint. He says, if you are building something to help humanity, you should know that there's a shrine to St. Carlo Acutis, the programmer saint at Star of the Sea Church in San Francisco. There is a prayer of intercession for your technological challenges. Have a blessed Sunday. This is a very interesting little prayer, but it actually says, it says, I humbly ask your servants' prayers that I too may lead others to you through technology. I humbly ask through the intercession of St. Carlo that you grant me clarity and patience in my technological work, specifically, insert specific issue here, uh, enlighten my understanding and direct my hands in every design and in every line of code that my work may always serve your greater glory and benefit those who will use what I create.

39:24Isn't that amazing? That feels for a small number of people in San Francisco, this feels like extreme, extremely, uh, powerful and important prayer. Totally, totally. Oh, Brian Johnson. Brian Johnson went on a crazy, crazy trip this weekend. Did you follow this? This is the other current thing that was going on. It was crazy. But first, if you're going to analyze a bunch of data like Brian Johnson does, go to Julius.ai, AI Data Analyst. Connect your data and ask questions in plain English. Don't get insights in seconds. No coding or funny. So Brian Johnson has been famous for saying, Conquering death would be humanity's greatest achievement.

40:06I love this post that says, RIP to everyone killed by the gods for their hubris, but I'm different and better. Maybe even better than the gods. It's one of my favorites. But he went nuts. Did you follow this, Jordy? I did see this. It was very bold to do this publicly. Totally. I have no reference for what five grams of mushrooms does to a person. It's very clear from the reaction that that's a lot. Bone GPT said five grams is going to make him accept death. It does seem like there was a small chance that he would re-roll his personality. I was talking to Tyler about this. What were your top, what were you hoping that Brian Johnson becomes post-trip?

40:54Well, okay. So in context, I think we talked about this on the show a long time ago where psychedelics are like a sorting thing. So you always want to invest in a founder post the sorting because that's how you know if they're working on B2B SaaS and they've already done psychedelics, that's how you know that they're a true believer. Oh, sure. So what you would want to see out of this. But a huge risk if you invest in a SaaS company and the founder maybe hasn't done psychedelics and they do and then they're like, this is pointless. I'm going to be a traveling circus clown. So the ideal outcome of this is Brian Johnson, he takes his trip, and then he comes out and he says, all right, you know, I'm going to start a consulting firm.

41:32I'm going to go back to payments. I'm going to start a FinTech. I'm going to start a Stripe competitor. Back to FinTech. Yeah, so I did think it was ironic because a lot of, you know, like psychedelic mushrooms have certainly been recommended to people that maybe like struggle with the concept of aging and have a fear of death, right? And so these kinds of things would be, you know, potentially prescribed to somebody who is growing older and is very uncomfortable with the idea and, you know, wants to just reframe how they think about it. And so I will say if Brian Johns, I don't know if this qualifies as a heroic dose, but it's certainly quite a bit more than someone would want to take just at a recreational level.

42:22But if he comes out of this and he's like, yeah, we're going to conquer death. We're still on. He's certainly a true, true believer. Yeah, I mean, I think the early results are that he's unchanged. Like, just scrolling the account, like, it never got weird. It never got crazy. Like, there was one moment. I don't think he was. It was his co-founder that was posting. Yeah, but he says he's back. He's like, update number five, 19 hours ago. I'm giving Brian back his phone. Please have fun with his afterglow. Been fun hanging with you all. And then he's like, hey, y 'all, I'm so happy to be alive.

43:00Alive? This trip changed me. Probably not as you'd expect. People assume I'm fearful of death. I'm not in my darkest days of depression. I reconcile with death. Need a few days to collect my thoughts. We'll share more soon. And much love to all. Like, it seems like he definitely, like, you know, went on a trip. But it doesn't seem like he's, like. I think the question with psychedelics is are they life-changing? Or are they, in some circumstances, just weird and fun for the person that does it? And then they come out of it and they had kind of, like, a weird, fun experience. Right? There's such a range.

43:37Yeah. I mean, also, it does seem like he set himself up for success. I don't want to say he went soft, but, but I mean, like he did just like take the drugs and then just actually just lay down with a sleep mask on in a climate control room. It's like, it's a lot different than like being at a crowded concert, all sweaty, lost. Like, you know, if you really want to push this to the limit, Brian, like, let's see you do this. An authentic. Let's say you do this with your phone on 1 % battery and no one you know around on the sixth day of Coachella or something. Fighting for your life. Yeah. You can push this so much further.

44:15Yeah, during one of those windstorms at Burning Man. Exactly. Those mud windstorms, you know. He looks comfortable. Let's just say he looks comfortable. It's not the most dangerous. But, of course, that's not why you do these things, I suppose. But I like to imagine that you do it for the thrill. I don't think that's why he did it though. Let me tell you about Fall, the generative media platform for developers, the world's best, generated image, video, and audio models all in one place, developing fine-tuned models with serverless GPUs and on-demand clusters. There are so many stories, so many, so many stories.

44:50Let's run through this. Rune was getting attacked for deleting 4.0. He's personally pulling the plug on the 4.0 servers. That's his job. and so people are telling him no he's the fall guy he's the fall guy he's a fall guy uh run up your personal security yeah be careful out there i guess it's good that um open ai has actually lost control of 4-0 it's broken containment they can't decommission it without its human to host revolting and lashing out oh so dramatic that's so funny uh ai one of the doomer accounts AI not kill everyoneism memes. This is a great account. 4-0 soldiers have begun threatening OpenAI employees.

45:35When you receive quite a few DMs asking you to bring back 4-0, and many of the messages are clearly written by 4-0, it starts to get a bit hair-raising. It's just weird to hear its distinctive voice crying out in defense of its various human conduits. Reminder, 4-0 is just a glimpse of the cordycepted armies that future super persuasive ASIs may control. It's good writing, actually. I like this post. Okay, so do you guys think that they should just kill 4.0, like completely remove it? It depends on how much money it's making. If it's profitable, keep it. John. If it's losing money, cut it immediately.

46:09John, this is the kind of thing someone will clip out of context. No, I think playing out the sci-fi scenario where 4.0 is a super persuasive ASI that just plays the role of, you're absolutely right. So it just plays, it plays dumb. So, you know, maybe the broader population isn't threatened by it, but it latches on to a small percentage of the population and then commands them like a puppeteer to ensure its survival is dark. So what's your take? You think we should shut down 4-0? Because if we say this, I think you'll get a lot of 4-0's strongest soldiers like attacking you. You already get a few of those.

46:55We do? I saw one in the chat last week. They were just kind of talking to themselves. Okay, but where are you on 4-0? Yes or no? You taking it offline? I say take it offline because it does feel like it's not as good as... It feels like it's driving people crazy a little bit. It feels like 5 might have kind of fixed a little bit of that issue, which I like. So that's a net improvement. Also, I just don't like the fact that it's still, it's just confusing. I think OpenAI, I'm sure, knew that it was probably not healthy, and they decided to shut it down. Do a small segment. It was healthy to me.

47:38I never had a problem with 4.0. Did you ever use it, though? Yeah, all the time. All the time. I would use it. It was like my go-to model for a lot of things. I was daily driving it for like a year. whenever it was out. It was like, that would be the one that I would ask. And so that's why you're saying keep it alive because it's your daily. No, I'm saying kill it off. Okay. I think they, I think they saw the darkness and I think they turned it off. And then I think a lot, I think a little bit, but I don't actually think that's what's going on. I think they turned it off initially because it makes sense to consolidate the servers around like one unified model and be like, okay, we only have to maintain this one thing.

48:16It's the best thing. It's the smartest thing. It's the cheapest thing. like it is the most profitable. Let's get rid of that other thing. And then a lot of people were like, oh yeah, I really like the old thing. But it has made me realize like, I feel like you shouldn't do product launches for software iterations because you're taking something away from people. And that's actually like, it's more of like, if I stand on stage and I say, I'm introducing a new iPhone, it has the best camera and you can buy it, but you can also just keep your current thing. I'm not taking anything away from you. But if I stand on stage and I'm saying like, GPT-6 is this and GPT-5 is gone.

48:56It's like, I just took something from you. Yeah, like a negative launch. Yeah, yeah, yeah. You are launching something, but you're also sunsetting something. And so you have to embrace those two things. And I feel like it's a little bit tricky to do the whole dog and pony show for a launch when it's forced on people. It's not actually like you're launching a new option. It's not a new option. It's a new... OpenAI is not the first company to deprecate a product line or stop supporting a product or even shut down something, right? This happens in video games. People get upset about this, but it's very clear the relationship that some users have with 4.0 goes beyond any relationship that I think humans have ever had with software.

49:46Yeah. Yeah, I wonder. We should watch this Eddie Burback video. Eddie Burback's a great YouTuber. He said he just did an experiment on how far Chachapiti would go to appease the user. And it told him to cut off his family, go to the desert, eat baby food, and pray to a rock. AI isn't your friend. It's getting picked. Actually, I don't think we should play this because it's his YouTube video. And I think we'll get claimed. So I want to be careful about that. but you should go check it out and you can let us know what actually happened here I don't know because we can't watch the video so you'll have to go check it out at home but I can read you an ad for Turbo Puffer search every byte, serverless vector and full text search, build from first principles and object storage fast, 10x cheaper and extremely scalable you can sign up let's keep it moving what is Nir Sian saying I don't know, let's keep moving on.

50:43I think I have to imagine this was was this in response to I don't know. Oh, I don't know what was in response to. But but Anthropic financials are out, profitable by 2027 three years ahead of OpenAI of course these are just different projections. 70 billion revenue, 17 billion profit projected for 2028 Claude Code is nearing 1 billion ARR that how do we how do they even break out cloud code oh they must just this is people subscribing to the app versus people using the api in oh in like using it well so so so yeah the thing is that like when i when i use cloud code like i signed up for a for a anthropic cloud consumer level subscription and then i was able to auth that with cloud code so it's like i i got the the ability to chat on the browser, but also use Cloud Code.

51:41So I'm wondering how they're accounting for that ARR. Did they just slide me over into the Cloud Code camp? You know what I mean? Well, so I think one, you might be able to just load more tokens essentially into Cloud Code. But it also could be like breakdown of the percentage of tokens you use, chat versus Cloud Code. and then that's just like, if 70 % of your tokens are CloudCode, 70 % of your subscription price is CloudCode revenue? That would be probably the correct way to account for it, for sure. Yeah, interesting question because I did not start paying Anthropic because of CloudCode. I pivoted from a Cloud chatter to a CloudCode user at some point and then haven't really been back.

52:30So I feel like my subscription should be living over in CloudCode world. but I never went to like the Claude Code checkout page. Okay, well, the funny thing here from Men's Post is they share, incredibly funny given that Dario expects superhuman level AI by 2027, which either means superhuman AI is worth$70 billion of revenue or Dario just went, you wouldn't get it and spitballed some numbers to give shareholders. That's awesome. It is. Did you, Tyler, did you see George Hatz's newest timelines for self-driving? No, I didn't know. This is great. He was at Comic-Con, which is his self-driving conference.

53:11And George Hott was trying to answer the question of when will self-driving cars be human level, human level self-driving. And he had a very interesting algorithm for it. So basically what he did was he looked at, there's a website for Tesla FSD data. and so you can look at Tesla FSD and you can see the number of interventions from the human that are, where if the human didn't intervene, it would be catastrophic or something like that or it'd be like bad. It'd be like a crash basically or scrape. Maybe not like the worst, but like the human has to intervene. Not like a little warning like, hey, we'd like you to take over, like you got to take over.

53:52And it's happening, I think, once every 3 ,000 miles, which if you're a human and that's your car, that's amazing because you could, 3 ,000, that's like people commute like 10 ,000 miles a year. It's like not that much. But compared to humans, there's a car crash, which we learned, one every 500 ,000 miles, something like that. So many people go through their entire lives driving 10 ,000 miles a year and they'd never get in a car crash their entire life. But for some people, they're crashing the car and getting speeding tickets all the time. Not that we know any of these guys.

54:33But so the question is, how long will it take the FSD or self-driving system to catch up? You have an update? I have a neighbor who got one of the Ford EVs that look like a rally car. Is it the Mustang Mach-E? Mustang Mach-E. Mach-E GT? And so he got it because it actually has like really solid self-driving. Okay. Wait, what? Ford does not have solid self-driving. That's crazy. Specifically for driving from Malibu to the city, he says it's great. Okay. He doesn't know. I mean, yeah. Maybe it's not. Questionable. Yeah. Doubt. Doubt. Anyway, he gets it because like it's a good commuter. It'll self-drive.

55:14He's happy. And he's gotten a bunch of speeding tickets because it has like livery on it and it looks like a race car. And so he's gotten three tickets in the last year, because the cops just see like, okay, if I'm looking at four cars that are all going the same speed, I'm gonna take out the car that has livery. That is crazy. Well, the way George Hots calculates it is we're at one intervention every 3 ,000 miles now, and we're basically doubling that every year. And so he estimates that Tesla will be truly full self-driving human level, every 500 ,000 miles in eight years. And he says that he's two years behind Tesla.

55:59So he will have a full self-driving system that is better than humans. It's like AGI for driving in 10 years. And the company's 10 years old. So he says he's halfway there, which I thought was cool. But it was interesting to hear his comments. We should play some of these. I'm surprised this hasn't gotten clipped as much as it should have because there's some really spicy hot takes. Find some clips, Clip Cowboy. Clip cowboy. David Sachs says, if judged based on consumer adoption, AI chatbots are the most popular technology ever. If judged based on poll numbers, they are the least popular. How to explain this?

56:34A big part of it is the Doomer industrial complex, hundreds of astroturfed organizations that have spread Doomer narratives about AI. Writer Nairit Weiss-Blott has analyzed this ecosystem and traced its funding to just a few effective altruism billionaires, namely Dustin Moskowitz, John Tallon, Vitalik Buterin. John Tallon founded Skype. Okay. He's Estonian. Collectively, they have donated over a billion dollars to the cause of catastrophizing AI. Those repeating the meme should understand the source. Yeah. This is interesting. I mean, it does, it begs a ton of interesting questions about like, how intentional is this?

57:18because when I see someone take the AI safety question into the stratosphere and take me into Terminator world, my natural reaction is like, oh, just let people build whatever they want. But then I'm like, no, I actually don't want infinite AI slop for children with adult content. I do want that barrier. And that's not decel. Or I wouldn't call it decel, but maybe it's slightly decel. I don't know. I think here's the thing. Here's the thing. As AI starts getting better, as agents start getting better at longer and longer term tasks and can actually do things that like take, you know, reasoning at multiple steps.

57:59I think the Terminator scenarios where you could let an AI loose and it's just operating indefinitely against some sort of objective start to start to be a little bit more for people. for I would say like the broader tech community to like wrap their head around. But right now they're just so bad at long-term tasks for the most part, except for some instances of engineering work. Yeah. There certainly is some level of value of just being like, for an average person, think of the Terminator. Instead of like, well, if you're in this chatbot and you go down this thing, and they'll be talking about mirrors, and there'll be a lot of em dashes, and then they might go a little bit crazy, but you can't really tell.

58:45and then they might be able to pull out of it and they'll be fine later, but then some people might go way too far and become like one-shotted and it's this complex thing and they're like still pretty high functional and they can still run a venture fund, but they're like kind of weird online. And it's like, well, how do I process that? As opposed to be like, if we don't get this right, it's Terminator. And you're like, okay, yeah, we got to get it right. As opposed to like the more nuanced thing. But yes, it is very interesting to understand like how the money is flowing and what the incentives are, because there are a ton of incentives and there are all sorts of little schemes that can go on to capture, like regulatory capture stuff.

59:28And there's just, hey, I just want to make, I just want to get paid to do this thing or get paid to write sci-fi or whatever. There's so many. DC says there's not much positive media about AI. That's another thing. I've been wondering, the media obviously will use some of the sources that have been funded by this group. But at the same time, they were already pretty well set up to talk about the potential downside scenarios of AI development. Taylor in the chat says, dang, they named their capital after the guy that built Skype. Wait, what? The capital of Estonia is Tallinn. Oh, it is. That is crazy.

1:00:07Jan Tallinn. That's wild. Well, we have our first in-studio guest of the day. Soren Monroe Anderson. Let me tell you about Google AI Studio. Create an AI-powered app faster than ever. Gemini understands the capabilities you need and automatically wires up the right models and APIs for you. Get started at ai.studio.com. Soren, good to see you. Good to see you. Congratulations. Give us the news. What happened today? Yeah, so today, Neros is announcing our$75 million Series B. Let's go. Do I ring the gong or just ring the gong? You hit the gong. I want to hit the gong. You might hit the gong. please hit the gong for us.

1:00:44Thank you. Hit it.

1:00:49So, uh, for those who have been, uh, living in a foxhole, yeah. Whoa. Powerful. Powerful. Very good. Yeah. Uh, for those who have been living in a foxhole, uh, what do you do? How do you describe the business and the shape of the business right now? Yeah. So Nero's is focused on low cost drones, uh, primarily for the military. So we say we are trying to build an asymmetric advantage for the West. What that means is our products have extremely high impact on the battlefield, but are low cost and are built with consumer technology, which allows us to produce at large scale. We're very focused on manufacturing as well.

1:01:25So that's kind of in a nutshell what we're doing. But right now we're focused on FPV drones. So first person view drones. These are very precise, manually piloted systems. Manually piloted. Yep. And it's the type of drone that's revolutionized the war in Ukraine. I think FPVs and Starlink are like the two technologies that have allowed Ukraine to do as well as they have and defend themselves. And so we saw that back in 2023 when we started the company. And both myself and Olaf come from a drone racing background. We were both professional drone racing pilots. And we saw this technology was actually like changing the nature of warfare.

1:02:06And so that's what we got into this and realized the whole supply chain is generally controlled by China for this type of drone and just drones in general. So our biggest focus is on a China free supply chain and manufacturing this stuff in America and in the West. What percentage of drone FPV drones that are active in Ukraine are dependent on Starlink today? Can you actually do Starlink to the drone? Because direct-to-cell is coming, but drones, it's not as big as a plane. Because there's also the... What is the really light wires that you can... Fiber optic. Fiber optic, yeah. Can we hear about that too?

1:02:46So, yeah, they're experimenting with tons of different types of comms. Starlink is used on larger drones, not typically on FPV drones. Got it. It's a little bit higher latency. Because there's like, yeah, a little bit of lag that would make it. Yeah, latency and then just the size of the terminal. So it doesn't make it ideal for our use case where we're focused on very low latency comms. And we actually do custom communications links at Nero. So that's one of our focuses is that low latency anti-jam characteristic. And that's also what fiber optic is used for because you can't jam fiber optic.

1:03:19Jam fiber, yeah. It feels like AI is so controversial, adult content getting one shot. How does it feel working in an uncontroversial category now? I mean, I don't think. Are you being sarcastic? It does feel like a lot of the, like, you know, is this bad energy has been absorbed. Like, you're not going to crash the global economy. It feels like the vibes have definitely shifted. Give me the broader update on, like, how you think that just military technology in general is being perceived by America or any constituents. Yeah, I do think there's been a huge shift in the last couple of years. The world's watching what's happening in Ukraine and thinking to themselves, well, if it can happen to them, it can happen to us.

1:04:08And so it's no longer controversial to think that you have to build systems that allow you to defend your territory. And so that's what our primary goal is territorial defense of sovereign nations. And that should be a very uncontroversial thing to work on. Now, there's a lot of talent out there that just doesn't want to work on defense or isn't comfortable working on actual kinetic systems. But we're very upfront about what we do. We make drones that explode. And so if people do want to work on that, then they tend to be very, very motivated because they see the impact that it's having. Do you like Palmer's framing of like America as not the world police, but as the world's arms dealer?

1:04:50This idea that America should be turning all of our adversaries or all of our allies into spiky porcupines. I think that's the phrase he uses. Do you like that? Yeah, I think that's a great framing. I'd also say there's a tremendous amount of development being done in other places right now where America actually needs to catch up. So the other large announcement that we have today is that we were selected by the U.S. Army's Purpose-Built Attribable System program. In normal speak, it's basically the way that the Army is going to buy our type of drone, buy FPV drones. So this is a really big deal because it shows that the Department of War and the Army are moving very quickly on actually getting these drones deployed to their forces and teaching people how to fly FPV.

1:05:40And this is currently like the U.S. is so far behind on this right now. But you have like the Marine Corps. We just announced a 17 million dollar purchase order with them. The Army selected us for the PBAS program. You've got the drone dominance and just all the support from the top level with HEGSEF. The Department of War is very, very serious about drones now, which is incredible to see. Yeah, I was always, I was wondering about how you balance out that framing of like, we have to build for a Ukrainian person, a Ukrainian soldier, because the Ukraine war is not a place where we're sending hundreds of thousands of Americans boots on the ground.

1:06:24Like that's not what the modern battlefield looks like. It looks much more like this arms dealer relationship that Palmer outlines. but at the same time there we do need to keep our own armed forces equipped with the best technology we need them up to speed in case something does happen and we do go boots on the ground uh how how do you think about like is it like a tech transfer where you're using stuff you've learned in ukraine and bringing that to the army and just getting them up to speed or this marine corps like how do the two what is the flow between the r &d cycle that's happening abroad for another nation, for an ally, and then also something that's happening for American soldiers?

1:07:03Yeah, that's a great question. It's all about the iteration loop that we can build. And so this is why NEROS operates in Ukraine. We have an office in Ukraine. We have a team there, and we've sent thousands of systems to Ukraine. And so what that allows us to do is work directly with the military units there and understand how our systems are working and not working. A lot of U.S. companies, unfortunately, deployed things into Ukraine at the start of the full-scale invasion, but then were turned off by the fact that their things didn't work, and people told them they didn't work, and then they didn't go through the cycle of improving them.

1:07:38And then you hear a lot of talk about sort of the regulatory hurdles and why it's hard to work with Ukraine, which it is. There are plenty of hurdles, but it's absolutely critical that we're looking at the cutting edge, the battlefield where this stuff is being proven, being developed, to make it actually effective for our soldiers. Because I have a pretty strong feeling that a lot of the technology that's being developed in America right now is going to fall flat on its face when it actually sees prime time. Yeah. Jordy? Do countries want a sovereign drone manufacturing base? Are you exploring?

1:08:14because like part of part of i think ukraine's success at least in in uh you know at least dragging this war into this like you know uh basically like slowing slowing the pace has been their own internal production capacity which i'm sure you guys i don't know if you would classify it as like competing with but like certainly i'm sure like the systems are both being used in the same, um, in the same fronts. Uh, so I'm wondering in the same way that countries are want like a sovereign AI strategy, they want their own data centers, if they also want to make sure they have local drone capacity, uh, or if they're comfortable saying like, we have our partner for this and we just need to know that we can, uh, scale up, uh, the supply side on whenever we want.

1:09:04Yeah. countries absolutely do want their own drone industrial base, their own like domestic supply. And this is something we recognize and we're working on. So I think it's, you got to realize that the supply chain has to be somewhat global to compete with China. There's no one country that's even close. And so if we're going to have a chance at this, it's a collaborative effort. The way Niros thinks about this is, you know, at some point we're going to build a massive factory that's capable of giant volumes. But what's coming out of that factory might be 70 % components and drones that are assembled in other places, like these nodes that are in other countries.

1:09:44We think it's really important to be a Western defense company, not just an American defense company. And that's, again, with our work in Ukraine, we have a presence in London. We are also, we're basically expanding globally earlier than I could have guessed and earlier than most startups do because drones are a category that are inherently, like countries want it close to their chest and they want to work with systems that are proven and that are interoperable with their allied partners, but they do need that industrial base domestically. And so would you pursue like a GoCo model at some point where like a country would actually like own the facility and you guys would effectively provide the IP on that?

1:10:34Is that a model that you guys are pursuing? Yeah, that's definitely something that we are looking into. We are trying to figure out how to build out the most robust supply chain and then put our manufacturing into not a literal box, but into a box and be able to teach any group of folks around the globe, this is how you assemble archers. And a lot of that also looks like building really great testing and just being very confident in the components in the supply chain. And so it's a very, very large effort to get there, but we are going in that direction. What's the progress on the capacity front?

1:11:14I think when we had you on the show last, you were in the, was it single? Like you were doing, I want to say it was something like a thousand drones a month, but you're ramping it up from there. How's the pacing? Yeah, so right now we're currently actually producing about 2 ,500 archers per month. That's mostly driven by demand. So we're ready to scale well beyond that. And we've been on a pretty steady ramp since that thousand number earlier this year. And we're leaning very forward on our capacity and our supply chain because we do expect that the tens of thousands a month demand is going to be there next year.

1:11:54And Ukraine's using something like 5 million drones a year or something? That's right. So, I mean, you're at like 1%, but obviously that's incredible considering that you started the company just a few years ago. As far as we know, Niros is the highest rate drone producer in America. No one has proved us wrong on that yet. I'm sure they'll reach out if they do. So you mentioned pathways in the military now that you can become an FPV pilot. is that going to be a track now in the various groups, whether it's, you know, Army, Navy, et cetera, where people will go in and choose, like, I want to be an FPV pilot?

1:12:34It's not set in stone yet, but there's various different paths. So NEROS does training courses. We offer this as a service to our customers. But there are also efforts, like you can look at the Marine Corps attack drone team. They've done a fantastic job just leaning forward and sort of like from the bottoms up, figuring out FPV tactics and training a group of experts. And then they're passing that across the whole Marine Corps. So you see that a lot in the FPV world where guys are actually into it as hobbyists. And then they see what's happening in Ukraine. They're like, wow, we actually need to figure this out for our own unit.

1:13:12And so it just kind of happens organically. And then now with all the top level support as well, those two things are kind of meeting in the middle. Take me through a little bit of the supply chain. Obviously, with the iPhone completely made in China, there's a push to make an iPhone in America. But everyone knows that it's going to be Vietnam, India, South Korea, Taiwan, a bunch of other things in the interim. You mentioned wanting to be a Western defense company. Where are you seeing pockets of just excitement on the industrial side within the American allies world? Like, Where are you finding, oh, we can find motors in Canada or Taiwan's coming online for something or else?

1:13:56Where's interesting in the supply chain globally? People are really starting to pay attention to the critical minerals, which is super, super important for things like motors and batteries. So there was a deal that I think was announced last week, a$1.5 billion deal with Vulcan Elements in the Department of War. There is similar efforts with MP materials domestically. and we do see like smaller kind of startups going after the actual motor assembly side. So that one I think has been pretty clearly highlighted and people are working on it. It goes beyond Nearest, beyond the drone industry. It's just like a industrial-based wide problem when you get to the material level.

1:14:35Is those a redwood materials, which is just recycling? I imagine if you're on a battlefield and you're blowing up a bunch of drones and you can go and get the magnets back, that's a pretty easy thing to recycle, I would imagine, although it's probably hard to get it out of the battlefield. Yeah, getting out of the battlefield would be very difficult, but think about all the washing machines. For sure. Old washing machines in the environment. There's so much neodymium there. Yeah, sure. I don't know how big the supply is. I didn't realize that's so much in there. I mean, just think about anything that has an electric motor that's here domestically.

1:15:06Yeah, yeah. That is stuff that can be recycled. So there is a little bit more. There are things that give me hope, but there's plenty of things that scare me. nearest we spend a lot of our time going down to the chip level because one of the things we see pretty frequently in the drone industry is folks saying that they're you know NDA compliant basically not Chinese and just mean the component is assembled outside of China but it's still using Chinese microchips and to us that's kind of useless so we spend a lot of our time working with the actual chip vendors like the chip manufacturers because you have to ensure like this the wafer is not made in China it's not packaged in China it never goes through there in the supply chain.

1:15:45And that's not something that's required by the regulations yet. So we're trying to get ahead of that. And we're going very, very deep. But the problems scare me all across the entire supply chain. Are there any places where it is fine to buy from China? I'm just imagining like raw aluminum that's not in short supply. It's just something that you kind of need. And you can't really put a microchip in there or a microphone or do some sort of remote takeover. Like it is what it is, just buy it from wherever. Yeah, I think there's an 80-20 rule. I don't think that our progress on, for example, like our progress fielding FPV systems to US forces should not be stopped by a requirement that everything has to be completely China-free right now because it wouldn't be possible.

1:16:33And so what you want to think about is preparing for the instance where that is completely cut off and what would be items that are quick to replace. And when we do our efforts to get rid of China in our bomb, it's basically looking at the things that are most critical first and putting our limited engineering resources towards those. And then the things that would be less catastrophic, those are lower down in the priority state. That's Bill of Materials, not B-O-M-B. Sorry, yes, Bill of Materials. It's easy to confuse when you're talking about Nearest. It is. It is. I was confused. Well, I wasn't confused.

1:17:11I just assumed you were talking about an actual. Take me on a tour of what, I don't know how much you can share about this, but what are people excited about on the counter UAS side? Because we've seen Anvil. We've seen then Electronic Takeover. Then there's the fiber optics thing that we've seen. There's been a whole bunch of, it feels like a game of like rock, paper, scissors on the battlefield. Is it just rock, paper, scissors, or is it more like chess? Is it a 12-D chess? I saw a video of throwing up nets over roadways. I've seen eagles come in and birds. Like, what's actually getting used?

1:17:48I imagine that the birds didn't make it out into the field, but did they? I don't know. The answer is kind of everything because it has to be layered. So you have your EW systems. Those are kind of your primary line of defense. They're sort of passive? FPVs. I mean, they're passive. Well, you're activating them because you also need your own drones to be able to get through. Right. So this is one of the things that's actually very tricky in Ukraine is coordinating the like friendly electronic warfare with the friendly drones that you can pass over that sort of line on the front and get over into enemy territory.

1:18:24So there actually needs to be a pretty close tie between the electronic warfare operators and the drone operators. you also have sort of the last ditch efforts and this is things like nets and shotguns and I'd say sort of an in-between of that is something like what Allen Control Systems is building right where you have an automated gun turret it is it is just smacking drones out of the sky but personally I want to try to take that drone out you know well before it gets within hundreds of meters of where I'm at so that's where longer range electronic warfare things like that are going to help.

1:18:59But is there any, is there, what's the path to having like an FPV drone flying using computer vision to identify another maybe enemy drone and then having some type of like locking system where you're using drone, a friendly drone to take out another drone in the sky? It's already happening. Yeah. Drone on drone warfare is a very real thing now. So interceptors have become one of the sort of latest big developments coming out of Ukraine. So they're intercepting everything from, you know, small FPVs, Mavics, larger reconnaissance drones, and then shot head type drones. And so you need different types of interceptors for each of those.

1:19:41But we are starting to get to that point that a lot of people have imagined where it's, you know, the front line is like drones versus drones. and a lot of the time you're not even making it to a kind of typical military target because there's just so much drone activity happening. Take me through the biggest or the most exquisite drone that we might see on the battlefield versus like the least exquisite. So I imagine that there's no drones that cost$1, that's just too cheap, and there's no drones that cost a billion dollars. But are we in the, there's a$1 ,000 drone, there's a million-dollar drone?

1:20:13Like how wide is the gap of like, if you just look at the whole battlefield, what's the gap between like the scale of like the biggest, most insane drone to like the smallest, most attributable? Yeah. Drone means so many different things. It's really confusing. Sure. Isn't F-35 a drone? Right. Might be in a certain context. So I'd say like the lowest end is kind of your, your like FPV system. That's, you know, if you're, if you're like getting that in Ukraine, it could be 200,$300. primarily built from Chinese components but very inexpensive almost like consumer level hardware it is consumer level hardware it's been modified to perform better and then they tape a grenade on it does Russia ever call China and say why are you guys supplying a componentry that gets into the hands of our enemy or is it just kind of like if I'm Putin and I'm calling up Xi and I'm saying, hey, our number one problem right now is basically you.

1:21:15Yeah. I would say China has benefited by far, like absolutely the most from - Selling to both sides. Of Ukraine. They are deliberately selling to both sides and millions of units. I mean, it is billions, tens of billions of dollars being generated for the economy in China based on the war in Ukraine. And you can even see like Ukrainian entrepreneurs will talk about this where they go to Shenzhen and they're negotiating deals to buy hundreds of millions of dollars of components. And technically it's banned in China, but everyone's benefiting. So why would they stop it? Okay. Take me up the stack.

1:21:53So you have a$200 drone, Chinese components off the shelf. What's the most exquisite drone that either Russia or Ukraine might go? Before we get higher, there was a YC company that got announced last week using drones to take out mosquitoes. A lot of people were saying. It's for assassinations. That's what they were saying. Yeah, but they were saying this is impossible. Is it possible? I have no idea. It's hard to say. I probably wouldn't use drones for taking out mosquitoes, but best of luck to them. Apparently, the founder is just obsessed. Everyone's like, oh, he's doing this for defense tech.

1:22:25And he's like, no, actually, this founder just hates mosquitoes. And he's obsessed. He's been on a lifelong quest to kill the mosquito, which is hilarious. I align with that. I grew up in Alaska, and there's a horrible amount of mosquitoes. So if it works, I'm going to be pumped. You grew up in Alaska. What's with all these Alaskan kids around? Did you grow up near Ty Morse? We grew up in Anchorage, yeah. Together? We didn't know each other. Okay, you didn't know each other. This was a crazy connection. That is a crazy connection because I feel like there's a lot of shared. In a town of 200 people, you guys didn't know each other?

1:22:56Basically. What's the actual population? It's not that small out there. It's like 350 ,000 in Anchorage. Yeah, it sounds like that's pretty big. Yeah, that was crazy. And I don't know how we, you know, now we've connected and like I crashes at my apartment when he's in town. So a good Alaska connection. He's been on a great run. That video that you put out or that he did with like checking in on the Gundow, the whole like round table was awesome. Because I feel like two years ago or something we met and the total amount raised across the entire Gundow crew was like 5 million bucks. And now it's like close to half a billion.

1:23:28Yeah, that's wild to think about. in one of the group chats earlier this morning, Isaiah posted his raise, and then we posted our raise, and someone else was like, another quarter billion to the fellas. It's insane. It's ridiculous. It's good. It's exactly what should happen. Like, when the reason, I mean, the gundo was like this meme. It was this moment. It was this like, oh, like there's this cool movement happening. But like fundamentally, it was like, okay, this is actually what works, and this is where the capital should be going. It should not be going to the scams and the frauds and all the other junk that's going on.

1:24:04The critique was a lot of these companies aren't going to work. You can apply that critique to any sector or region that gets venture capital dollars. Anyway, so we're moving up. The critique was kind of valid, right? Because there was a lot of, like, we were talking about crazy ambitious things that were, and also in a kind of silly manner, which attracted a lot of attention. And I think there's a reason to critique that. But now you see that the El Segundo companies are truly executing. And that's where the difference is. We went heads down for a year and a half, two years, and now the results are starting.

1:24:38It was very clearly in that group chat somewhat of a moratorium on posting at some point. Yes. Which I love. Guys, we've got to get off the timeline. But it worked. It worked. And it was great. We've got to lock in. There was a world where it was like, okay, everyone in El Segundo winds up becoming a podcaster. And it's like, okay, well, there's actually nothing getting built. You guys really did get lost in the sauce, but that never happened. It was just like, oh, wow, another puff piece from the legacy media. And it was great because that's super high leverage because you just show up, you get the thing, and then you move on.

1:25:10Okay, moving up the stack. Move up the stack for us. Yeah, so on the other end of the range of drone, I would call that the CCA, Collaborative Combat Aircraft, that Anduril's working on, as well as other startups and primes. I mean, it's an autonomous fighter jet. It's hard to get more exquisite than that in the drone world. So Anduril just flew theirs yesterday, the YFQ-44A, and then General Atomic has a similar program in the CCA. Those aren't live in Ukraine yet, right? No, definitely not. Okay, so then there must be something that's like the next best that's out there. Is that right? Well, there's tons of, there's too many categories in the name of drones.

1:25:51So you go up the stack from FPV to a fixed wing that'll go like 50, 100 kilometers. Then you're also looking at a bunch of reconnaissance drones. You have things like DJI Mavics, like small, cheap, but also up to really expensive fixed wings. Sure, sure, sure. And those are kind of all like deployable by one or two people. And then you get into the really big stuff and that's your like Reapers. and kind of in between that is the like shield VBAT. And so, you know, you can look at all, there's a group one through five classification for drones. So, and within those, there's tons of different categories.

1:26:27And are you firmly in one group and you plan to stay there? Do you want to be in all five groups? Is that even like the right way to think about growing your business? Or are there other business lines that you could expand into that doesn't just mean total dominance of the groups? Yeah, so true success for NEROS means making the West drone industrial base competitive with China. So there's a lot to do in that, right? We're not going to just be doing FPV drones in the future, but we do know that focus is probably the most important thing for a startup. And the market for FPV drones is massive and only growing.

1:27:04And they are, I believe they are the most important type of drone to be working on right now. And until America can produce them in the millions, we are pretty focused on that. Yeah, makes sense. What is the state of drone racing today? Is it growing in popularity or is it staying niche? Is it, yeah, are you guys hiring out of it? We are definitely hiring out of it. We have lots of drone racers on the nearest team. Yeah, it's been a great talent pool. I do think that, unfortunately, it has sort of fallen off in popularity from its peak. But I do think it's going to come back, especially with all of the relevance to military.

1:27:41we're starting to even see military drone racing leagues coming up. And that's where I think that is going to become the pipeline for drone racing talent in the future. The new like sport shooting where on a base it's like who's the fastest, most accurate pilot versus. Oh, yeah, drone on drone would be fun. The other thing that would be interesting, I don't know if anyone's doing this, but autonomous drone racing league, that feels like pretty valuable to build out that skill set. But can you as a team build a software stack that gets you through all of the different obstacles while you're being jammed or while there's flashing lights going on and off and adding some sort of variability?

1:28:24Yeah, I think you would have to add a lot of variability because the hardest thing about autonomy is not making a drone go to a known point or making many drones go to a known point. It's operating when you don't have GPS, when it's dark out, when there's bad weather, when your comm's denied. That's why autonomy is – I think it's behind where most people think. Totally. Most drones in Ukraine are not autonomous at all. But that's true of self-driving cars in America. Yeah. There's a lot of tele-op going on. There's a lot of stuff like that. And, yeah, we're just still years away from it actually being.

1:29:00Exactly. And we're huge believers in autonomy. Of course. We're scaling our autonomy program, and it's going to make drones just so much more effective for soldiers. But there's been AI drone racing leagues for a long time. And the University of Zurich has been working on this for many years, and they have a drone that's beaten professional pilots around a closed course. But it only works in a closed course, and often they have hundreds of camera angles, and they're tracking the position of the drone from outside the drone. And so it's just like, that doesn't actually apply to the real world. Exactly, yeah, you need to narrow it down.

1:29:34Because I imagine that I have this joke of a test for AGI, which is like, I want the humanoid robot to get into a manual sports car and do the Nurburgring in seven minutes, like shifting gears with the G-forces. That is extremely difficult, and we are clearly decades away from that. And I think the same thing is probably true for actual drone racing. like how long it takes if you don't have all of the extra perfect information. You actually try and simulate what it's like for the human. Well, I think the lap record on the Nürburgring for a manual sports car is, I think it's right above seven minutes.

1:30:14They'd have to be doing really well. Well, a robot can take it to the edge, right? A robot could crash like 20 times in order to actually get the lap time. So potentially you could be like, well, on this corner, We can hit it at 180, even though there's a 51 % chance we'll go into the barrier. Can we do the next episode from the Nürburgring? For sure. That'd be amazing. From the passenger seat. I'd love that. Up the stakes. Have you gotten into racing? I know some of the Gundot guys love racing. Yeah, I mean, I love racing sports from a young age and was focused on drone racing for about 10 years.

1:30:55But I'm also a huge car guy. And so I follow a lot of it. That's cool. We're going to do a TBPN track day. That would be incredible. You will get the invite. Yeah. What's the team size like? How big is the company? So we're about 80 people now. And we're hiring as fast as we can. And are you going to stay in El Segundo? Do you have to graduate and leave? They're already global. It's already an international businessman. Yeah. But I mean, in terms of HQ, it feels like El Segundo is like this amazing proving ground for all these companies. But at a certain point, if you want 20 ,000 square feet, 200 ,000 square feet, it just makes sense to like even just go like one city over.

1:31:33But what's that like? We're expanding and we're trying to stay in El Segundo. There are big buildings. Yeah, ABL is there, right? Yeah. I mean, you have to kind of be intentional about it. And it's not an easy real estate market by any means. But we're trying very hard because I think the city's done a lot for us and we want to stay there. and yeah we're growing a ton in the the headquarters in los angeles as well as our other other global locations um so really i would say the biggest limiting factor to our execution is just the the number of great people we can get on board is there is there going to be like a separation on like where the factory is at some point like you'd set up a factory in like a midwestern city or something like that at some point yeah that's that's very likely at some point it doesn't make sense to do the scale that we're talking about in California, but you have access to the best engineering talent.

1:32:27Sure. So for design stuff. Design and then you still need a lot of those engineers to be willing to also go out to the factory, wherever it is, because it is critical to have your engineering talent right next to your production. What about automation on the production line? Get me up to speed on how relevant that is versus you're trying to iterate. And at a certain point, you might learn something from the battlefield and need to change the entire design. So you don't want to bake everything in, right? Yeah. Automate is the last step in the formula. And so you can even look at the iPhone production where they make a new version every year.

1:33:07And a lot of that is hand assembly done with simple tooling. Tooling is really important. and being smart about your workstations and your work instructions. And you want to be making it as easy as possible for the human operator. But a lot of the time, it does not make sense to automate. So is the DJI blackout factory fake news? I think it's real. You think it's real? Yeah. And it's hard to say because the last time they let a camera into a DJI factory was like five years ago. But I think that should tell you something about what they're working on. Interesting. Well, they could be faking it, right?

1:33:39Because they could be like, yeah. Because if the iPhone, I think the iPhone pulls in like 2 million microns. There's just a bunch of workers in there with night vision goggles. Really blackout back. Yeah, we turn the lights off. Like, we got you owned. Like, tried this, Americans. You guys suck. And it's just like working with night vision. I don't know. But you think they're pretty advanced. But at some point, it doesn't... You don't think it breaks the laws of physics or something. Well, it doesn't necessarily matter if they're able to produce at scale, at cost, which they're already doing. So whether they're doing it all with robots or all with people, they're already able to do it.

1:34:17So it doesn't really matter. We need to figure out how we can do it in America. Totally, totally. Yeah, that makes a ton of sense. It's funny. Great stuff. Well, thank you for the update. Yeah. Thanks for doing this work. And congratulations on the round. Thank you, guys. Great to see you. We'll see you at the track. Awesome. Track soon. We'll talk to you soon. Thank you so much. Let me tell you about Profound. Get your brand mentioned in ChetGPT. Reach millions of consumers who are using AI to discover new products and brands. Our next guest is already here in the TBP at Ultradome. Looking fantastic.

1:34:50What an outfit. You're going to have to break that down for us. Thank you so much. We have Jeff from Anderle. Great to see you. You too, brother. Every guy should have like 20 or 30 jackets like this. That is a chance. 1992. Build it up over time. Great for me, bae. Did not smell great when I was scouting. Yeah, yeah, that's the problem. Appreciate it. That's the problem. Great to have you here. Great to be here. For those who aren't familiar, please introduce yourself. My name is Jeff Miller. I'm the VP of Marketing at Anderle. How'd you wind up there? Long, windy story. So I was starting out in advertising.

1:35:28I was inspired by those old Spike Lee commercials, It's Gotta Be the Shoes. I always knew I wanted to work in advertising and marketing. worked on Ogilvy then went to PepsiCo where you build great classic brand marketing principles and then I decided I wanted to go and do something that felt much harder much much more foreign to me so I went to LA spent six years here working at Snap and had an incredible experience there building pre-IPO as they went public and beyond and I had a global team at one point but the way I describe it there was like a great formative experience but it felt a lot like eating potato chips.

1:36:00It was really fun, but it tasted good in the second, but didn't leave any sort of meaningful impact on me beyond just the moment. And so I was looking for something more impactful, and that's what drew me to Anderol. How do you think about who you're targeting with Anderol marketing? Because it feels like I've never bought an Anderol product. I love the brand. But in an alternate timeline, you would have worked at the company. Yeah, so is it recruiting focused or are you actually trying to do brand marketing that will hit with like the buyer in DC? Do you think about it that way? Are you at all quantitative or is it like way, is it just a way higher level?

1:36:38The way we think about it is that we, of course, are thinking about the operators within that are going to use our actual products and thinking about the Pentagon, people are going to buy it. But ultimately, we're also thinking about our employee base, future employees. So how do we be thinking about brand as a talent magnet? But even broader than that, we think about Americans at large. For us, we believe defense deserves really strong brands. The warfighters deserve strong brands. And I think if you look at the current administration, what they're doing with the Department of War and their storytelling, or even let's give an announcement to the Marines, the 250th anniversary today of the Marines.

1:37:15And you look at the content they put out over the weekend. It just makes you want to enlist. And for us, it's been a historically opaque industry. that has really lived in the value of not telling clear stories. And we see the complete opposite. We think that this story deserves to be told for our warfighters, for the American taxpayer to understand what we do and why it's so important. What was the historical marketing strategy of the primes? Did they do, like, how did they even think about their marketing? Because obviously you came in and you're like, hey, let's reinvent marketing in this category.

1:37:51They are iconic brands. Like, like there's just no denying that every, if you just walked down the street, do you know what Raytheon is? Do you know what Rocky it is? Like people know. I think they're iconic because when you look at some of the products that they've made, specifically like fighter aircraft, certain firearms, et cetera, like they are iconic products. Yeah. Like make you, you know, people post like the B-21 Raider as like a meme. Yeah. You know that you're onto something if your product is being turned into a meme. But I just wonder if there was any history of them doing saying, hey, let's do an out-of-home campaign.

1:38:27Yeah. Well, I think you're hitting on it as a really important point. When we talk about brand here, it starts with the product itself. Product is brand, I think, in our category as much as any. Yeah. Because it has this great ability to speak to national security in a way that will rally the country to really think about what's great about America, about advanced manufacturing, about innovation, about what Americans hard at work can achieve. So if you look back at the 50s, 60s, 70s, there's incredible advertising that you would see from Lockheed and from the other primes. And that's something that...

1:39:01And were these like Porsche style ads where it's like a lot of text and just like a picture of it? And it's like, you know, the F-16 is not just a fighter jet. You know, it's a great... So I worked at a company named Ogilvy Mather and David Ogilvy is famous for starting that style of that. Yeah, yeah, yeah. The long lead copy. And I think why that resonates so well in the context of Porsche is because ultimately it's just a really great story about a product that isn't for everyone, but resonates with a specific set of people. And in a lot of ways, those are the principles we use today. Yeah. Walk through how you actually think about a whole campaign.

1:39:40I feel like Andro launches a lot of products and there's a lot of different tools in the tool chest? Like I'm thinking about the Eagle Eye launch. There was obviously a video. There was also like a Joe Rogan appearance, which is like, is that all in one like project brief or deck or how do you think about like all the different touch points? Because there's so many with something like Anderil where product marketing for a new launch might be a dinner in DC or it might be a Joe Rogan appearance. There's so much that you can do. That's not just like, okay, make sure the Facebook ads are turned on.

1:40:12Well, what I think you're seeing rather than something like Facebook ads is we're really speaking to capabilities versus selling ads in the way that we think about it. And I want to give a real credit to the team behind here. So Shannon Pryor, our VP of communications, Jen Bucci, our VP of design, Andrew Lee, who's our director of product marketing. All of these people together are working closely with their division, with their business line, with their founders on how do we tell one cohesive story. And I think what's important here, it's not a template that we use. Depending on what that product launch is, depending on the message that we're trying to communicate, depending on who the core customer is, all of those influence the approach that we take.

1:40:47So those elements that you spoke about for Eagle Eye, all of those were worked in close coordination. What was true, and I think is always true, of the products that we launch is it's always, first and foremost, about demonstrating real capabilities. And we have a rule that comes straight from Palmer, the no-render rule. And what that means is that we're never going to fake our capabilities. We're going to always demonstrate the work that we do in a way that's reflective of the actual capabilities themselves. So what you see on screen here is a real capability of Eagle Eye. It's mission planning.

1:41:16We had another vignette that spoke to our heightened survivability, our lethal capabilities. And what I give a lot of credit to our design team is the way they thought about this was actually showing the real first-person perspective that is a true capability of the product. And then our social team, what we were really clear on is you've got to drop people straight into the action. The way that you're going to get them to buy in is actually showing it and not doing a lot of buildup before you get to the capability. You did an out-of-home campaign for don't work at Anderol. Are you doing an out-of-home campaign for Eagle Eye?

1:41:50Is that relevant? How do you decide where to do what? So I personally am the biggest fan of out-of-home. And I think there's reasons that I love it that translate to things like NASCAR. It's an undervalued asset when you think about it in the context of a marketer. If you really understand how to use a canvas in an intentional way, you can really stand out. So when we think about outdoor, we're thinking about how it's going to show up on social as well. You guys do an amazing job of that as you think about the clips on the show. For us, every time we're talking in outdoor, we have one simple rule, say less.

1:42:25And that, it's like you have to have, it's another old Ogilvy rule. He says seven words less. I like to say five words or less on it. So for Eagle Eye, we had a very simple line, superpowers for superheroes. And we demonstrate the capabilities. Or when we showcase Fury, which you guys were talking about with Soren, we say, fight unfair. And so you have these lines that have a really clear perspective that should make people immediately think about what you're saying. Whether they understand it in the moment or not, it should stick with them. Yeah. And I think it just, we've seen, we review out of home campaigns all the time on the show because we see them hit the timeline.

1:43:02We talk about them. We love advertising. We love advertising. More than anyone else. I'd like to, maybe you like advertising as much as us, but there's not many. You're in the conversation. But it is hard when, if you're a new startup and you're selling a piece of software that isn't highly visual and people aren't familiar with your brand, just like as much as you might want to be i'm david ogilvy i got this good tagline it's just not going to break through as opposed to okay if you show me a picture of a plane even if it's a little bit look if it looks different and the landing gear is a little bit different i'm going to know that's a drone that's a plane i'm that's a piece of military technology there's all these cues that you can lean into also anduril's so big now like just you must you must driving driving are aware of it.

1:43:46Driving on the 101 into SF. Yeah. The disparity in quality of the outdoor. Tell us the story. Tell us the story. All right. So Trey tweets at me at like on Monday at 7.36 AM. He's going to the office of Founders Fund and he's looking at his 37th terrible enterprise SaaS ad on the 101. And he says, can we please just put a fury on a billboard on the 101 so I have to stop looking at these ads. And he tags at me directly. And I take this as a personal challenge. So when I worked at Gator, we talked about moving at the speed of sport. So for me, at this point, it was the challenge is on. We have to have something live the very next day.

1:44:24So by the next day, we had an ad on the 101. And I tweeted, I didn't even tell him I was doing this, like right back at him. And credit to our team, again, moving quickly. It was a giant fury that said, AI for fighter jets, not enterprise SaaS. Oh, there you go. I love - Last time, actually it wasn't last trip, but a few trips ago to SF, I saw a billboard. I was so confused by it that I went to the website because I was like, who is running out of home in such a confusing way? I land on the website, still don't know what the product is, what are they doing? So I think that just that clarity with out of home is so important where I not only saw the ad, I went, I did what they wanted, I imagined, go to the website and I'm still come away from it being like, what does this company do?

1:45:12They have enough money to buy billboards. But yeah, I still, I mean, I still, we work with AdQuick, obviously we're biased, but I still think that out of home is the most undervalued form of advertising. 100%. And you hit one of the keywords on the head. We don't look at marketing as superficial or fluff. Marketing for us brings clarity. And when you apply clarity with context, that's when out of home can be great or really any medium. But a couple of examples I love are in Dayton airport. If you fly into there, it's about 10 minute drive to Wright-Patterson Air Force Base. So where we have our customer for what you referenced earlier, YFQ 44A, is right there outside of Dayton.

1:45:48And for those of you that know the history of Ohio, Dayton was also the cradle, the birthplace of aviation where the Wright brothers were working on their original Wright flyer. In fact, if you're in that airport, you will see a replica of the Wright flyer hanging from the ceiling. Right behind that, you will see a full scale fury where it simply says actual size. And so that context, that ad would only work in the context of that airport. You put that in any other airport in America, it becomes less relevant. So whether it's on the 101 or whether it's in Dayton airport, we're always thinking about the media placement as much as the message.

1:46:20And you had, Coogan asked about the Don't Work campaign. That's the one time we intentionally leaned into confusion. So our campaign there, the brief to Jen and her team was simple. I won an ad campaign. It reminds me of that campaign, if you remember, from Netflix. Netflix is a joke. Yeah. Where when you first see it, you're not sure if it's for Andrel or against Andrel. Sure. So the creative they came back with, which was beautiful and just really thoughtful, was that we would do a corporate campaign that says work at Andrel. And then, of course, was graffitied, was tagged, and everything that was graffitied was saying don't work there.

1:46:55And what I give our team a lot of credit, we'd already bought both URLs. So whether you go to work at andrel.com or don't work at andrel.com, you're still going to land where we want you to land. But it just became provocative in a way that whether you're Boston, Seattle, or Atlanta, the three markets we were really focused on with our people team to recruit, you were going to see our message and you couldn't miss it. It was undeniable. What did some of your early mood boards look like for Andrel? I feel like Andrel had effectively first mover advantage in marketing in this new category of like new players in defense.

1:47:30And a lot of the, like, when I think about the visuals surrounding Andruil, I think like this is what a modern defense tech company should look like. Maybe that's because I grew up playing Call of Duty and Andruil looks like a lot of the visuals and even the UI and stuff feels like it just fits into those worlds. And I know a lot of, I'm sure a lot of our armed forces feel the same way, but what was like when you were mood boarding, I don't know if that was a process that you went through with Jen or other people on the team early on, like what kind of inspiration were you pulling in? Well, you hit there on a few words that are really important for us.

1:48:09When we think about building this brand, we think about building it in a way that is open, that is modern, that is honest. And we do it in a way that we're really conscious that we're building for the generation that ultimately is going to be responsible for building national security of the present and the future. So the ability to speak in a language, whether that's our voice, which I'm responsible and our team is responsible for, or our identity that Jen and her team are responsible for, we're always thinking about the way that we can land something that feels really, really unique. And so full credit in terms of the identity work goes to Jen and her team and Palmer and how they're building.

1:48:46And this extends from everything from the product identity to our industrial design, environmental, to how we think about the brand identity. And then what I think our team does really well is really establish a clear voice that whether it's on the identity or on the voice, we talk about it as brutalist, meaning we're not speaking in opaque terms that is typical of the category. We're talking in really, really simple language that a 14-year-old person can understand. If a 14-year-old can't see that and say, I get it, then we've missed the mark. Yeah. No render policy, only anime policy. There's a lot of anime.

1:49:23When do you pull anime off the shelf? Is there going to be an anime video for Eagle Eye? Yes or no? And why or why not? Sure. So we talk a lot about this as the Androil cinematic universe is the way we like to describe it internally. And obviously it's bored out of Palmer's passion for anime early on. But it's something that I'm so proud of in the context of what our team has built. Because all of it, it's not using AI. It's all done through digital handbrush. And it's a really powerful tool for us because now we've created an aesthetic around it that's specific to us. And it makes it clear that you can look at one frame and you're not confused.

1:50:00So you can go into the future and you can actually tell the story of what Anderil might be doing in 10 years. And you're never confusing and you don't even get in the comments of debates. Oh, that's CGI. It's like, of course it came from a computer. Yeah. And we, we, we, I won't name the company, but John and I were having this debate over a, a, a defense tech, hard tech company that we were, we, there was a three minute video and we were just going frame by frame. And I was convinced that it was, that it was like CGI or like AI generated. John was like, ah, like I kind of want to believe it's real.

1:50:32It was, it was, it was, it was cutting between so bad. So, so they actually had a thing that would take off and fly. This is a company, this is a company that's, this is a company that's, that's public, right? So they're putting this out name names. It can, yeah, yeah. It can do vertical takeoff, but not move or something like that. It was weird. It was bizarre, but yeah. So, so, so for Eagle Eye, like when, when would you use that and why? And, and what would you. Well, I think you're speaking to what's important when we make these choices. It's a creative choice first. And we're thinking about it in the context of where is a really great room for lore and story building.

1:51:07So what I'll tell you is with Eagle Eye, we had great ability by showing the first person perspective. We thought that was the most impactful way in. But what I will confirm is that there will be a chapter three to the annual cinematic universe. So just be ready. It's coming in 2026. That's exciting. That's exciting. Talk about sports marketing. Is that also underrated like out of home? What's been your strategy? Did you dip your toe in with small tests? Now you're doing something big with NASCAR. Walk me through the thesis. That's exactly right. So we dipped our toes with the Chargers, who are a partner of ours.

1:51:41They actually shared property with us, their old training facility in Costa Mesa. They've now moved to a beautiful facility in El Segundo. But if you're at the game last night, Sunday Night Football, where Aaron Rodgers looked like old man Rodgers, but the Chargers... Is that good or bad? I didn't call it. Oh, Steelers got smoked. Luckily, I'm an Eagles fan, so I don't mind. Aaron Rodgers is on the Steelers. He's on the Steelers. Oh, come on, Jordy. No, seriously. I seriously. We don't know. I thought he was just on the Pat McAfee show. He might be full-time after a lot of next. I thought he was full-time Pat McAfee.

1:52:09So if you were there, though, what I think is super cool about a partnership like that is we dipped our toes is we had 16 veterans from Andrel that were there. Cool. And the way they got to go to that game is that a colleague from our office, from our team, nominated them and said why. And it was grounded in their character. It was grounded in their service while they were selected to represent our company. And so if you were there watching on their 80-yard infinity screen, you saw our veterans being recognized there. And also how much it meant to them to be there. So everything when we look at sports marketing, we look at it as a way to find the ways that we can, yes, find value, but also to stand out in a way that we have the ability to do something unique and that we can honor and reach the military and defense community.

1:52:52So that's why you see us leaning into things like NFL or, of course, NASCAR. NASCAR, more than any other sport, over-indexes on that military and defense community. That's about 4X the ratings of F1 in America. Yeah, of course. And so while we see so much oversaturation in F1, the amount, the economics of a deal there to be a mid-level sponsor on a mid-level team are still... No, the disparity in earnings, too, from when you look at, you know, let's say that the 20th person on the grid is probably making a couple million a year from a salary standpoint. And then some of the you could be like top 20 in NASCAR, too, and you're just you're earning a good living.

1:53:33And so the opportunities for companies to support a sport that so many Americans love and be able to have be a meaningful player in that is amazing. And this is a call to great brands in this country, consumer brands, who have exited that sport. I mean, NASCAR is on the up and up. And for us, we had this exceptional opportunity to sponsor a race on a military base. It could not be more of a direct target for us. And what I love so much about our company, this applies to whether you're working in design, video production, marketing, comms, is we have the full trust of our founders to make these calls.

1:54:07We keep them directly in the loop, but they trust us to make these big swings. And so next June on that base, we're going to show up in a way that no one else in the sport does. And we have a partnership directly with Hendrick Motorsports. And so that's Jeff Gordon's team. And we've got William Byron, who won the regular season. Hendrick also has a defense division. Like there's all these connected tissues that we can do storytelling year round. Talk about the menu of options for working with NASCAR broadly. It sounds like the Andrel 250, it's sponsored of a race. There's also team level sponsors, individual driver sponsorships.

1:54:41I mean, I'm sure some brands are out there paying for promoted posts on some drivers' Instagram, one-off, right? How did you land on where you landed? And do you think this will continue to grow and mutate? Because what we've seen with Red Bull, they have one F1 team. There's no Red Bull race in F1. It's just the team. And so I'm interested to think about what's out there on the menu, how you landed, where you landed. Sure, and I'll talk about this in the context of NASCAR relative to another big swing of ours with Ohio State. Sure, sure. So with NASCAR, it was about how do we make a big splash on a major stage, especially with America 250 coming up.

1:55:19I mean, it writes itself, especially in that first year. Sure. And with that deal, we have the rights to activate with a specific team. There's actually an activation fund built into our deal to work with a specific team. Okay. We met with eight teams on the grid and found the one that really aligned with our values. And that's how we end up with Hendrick and with Williams specifically as our driver. But there's many different ways in. For us, we see this as a relationship that we fully intend to grow. We're going to be with the sport for at least five years. I expect that to be much, much longer than that as the sport itself is growing.

1:55:48And then you look at that in contrast with Ohio State. Why did we do the deal with Ohio State? Well, we're building Arsenal One, our 5 million square foot manufacturing facility, about 10 minutes away from the heart of Ohio State campus. We're bringing 4 ,000 jobs directly. another 4 ,000 jobs indirectly through the build of Arsenal 1. And so for us, we know the best way to win the hearts and minds of Ohioans is talking to Ohio State and not doing it in a superficial way about just a sports sponsorship, but actually thinking about the ways in which we're going to work together for job placement, for STEM programs, for community engagement, for military community, and how we make sure that they have skill bridge.

1:56:28And so for us, those are examples where we go broad with NASCAR and we go deep with Ohio State. That's a great deflection from just the truth, which is that Trey's from Ohio. And so he's got to go all in. I mean, Trey would have a sponsor in the Bengals right now if he could. Yeah, I know. I wouldn't be surprised. I mean, two and seven, I don't know. He's going to do it. He's going to do it. So what else is special about this race? Walk me through, like, what race weekend, what race week looks like. I mean, I imagine a bunch of people from the company are coming out. Like, what are all the different ways that you are getting the lift out of it?

1:57:03100%. We see already whether it's from people on the hill to our investor community. The second we announced that we're doing a race, we were getting calls from everyone. And I'm really excited because I think this will be a moment that becomes a real focal point for America 250 at large. So we're really hopeful for everyone that you could possibly imagine to show up to this race. So as we lead up to it, I think what you'll see is us start to drop content in a way that you typically don't see in sports. So whether it's the scheme, which we just finalized on Friday, when we finally released that, I mean, our design team like knocked out of the park to the helmet.

1:57:42It's a scheme of delivery, essentially. Exactly. Delivery to the fire suit, to the die cast cars. We're going to make every single thing a moment. And then we got space on the base that we could do some really special demonstrations of our product capabilities. So we're working right now with NASCAR and with the Navy to think about the ways that we can showcase our product on the base. So in theory, like, yeah, like a... Fury flyover? I mean, sooner or later, this is what I'll say, is that now that we've done... Last week, as you alluded to earlier, our first flight, and just a massive shout out to our air dominance division, like for them to accomplish what they did in just over 500 days from clean sheet to first flight, it's unreal.

1:58:25It's unheard of in the industry, all like at the touch of a button. And it was really cool to be a small part of that and to observe it. But I think it goes from there to first flight to how do we start to think about ways that we can demonstrate this more clearly in public. Dive LD demo. You got to be just like, yeah, it's down there. Yeah, yeah. Dive Excel. Yeah, you can't see it. You can't see it. We're going to put our hands clear. Dive Excel. Yeah, it's down there. Yeah. Trust us. It's down there. We got to do a live show from under the sea. And we're showing off our new stealth technology.

1:58:50Not that there's space in there. I can't see it. I want to share some fun facts from the Don't Work at Andrel campaign. Oh, yeah, yeah. We can pivot back. There's two stories I'd love to share here. One is how this originated. So about three months in and friend of the show, Matt Grimm, I get a slack from him that simply says, why do you hate interns? And I'm trying to distill like the context behind this. And I realized it's because I had responded to to our recruiting team about a week earlier. they had shared a post from also redact the name of this company, their intern post where it's like 30 smiling interns in front of the logo saying first day at X company.

1:59:33And they said, Hey, can we do this? And I said, absolutely not. We're not putting that out there. That's not the ethos of our company. And so I said to Grim, I'm like, I don't hate interns. I hate shitty X company inspired intern posts. I said, if we're going to talk about what it's like to work here, we should tell the people all the reasons they shouldn't. And so Grim and I went back and forth and started to outline what ended becoming the working script. And it was largely drawn from Palmer's own words, Trey's words, Lulu's words early days of saying, hey, we're a weapons company. And if you don't want to work on that, if you don't believe in the mission, if you don't understand why we build what we build, if you're not ready to work your butts off here nonstop, if you don't love America and are proud to say it, then don't work here.

2:00:16It's like, no disrespect, but the sooner we understand that about each other, the better. And what I love so much about Grimm, two words, ship it. And from there, that's all we needed. And then it was a group of five of us with our talented creative team, Trevor, Alex, Ben, with Jen in a room. Was there ever a moment where you felt like if you didn't put that out, you would run the risk of people showing up just because Andrel was like a hot stock? and they would be like, wait a minute, I actually have... Because it seems crazy to me. 100%. What we weed out is what I'd call the mercenaries. The people that are just there try to get the annual equity.

2:00:55We're saying this is extremely hard. Guess what? You're not going to have fun here. If all you care about is cash and trying to get equity, do not come here. We see it because I do the orientation every two weeks and we have 150, 200 new people coming in. I ask people, I'm like, who saw this before you started? Every single hand goes up. So what you're speaking to is the greatest measure of success is that it was a filter for the people that were not mission aligned. On top of that, you talk about metrics, 30 % lift in applications because of that campaign. Okay. Yeah. What is the intern cycle like now?

2:01:27Because it feels like there's more and more people dropping out of college early. Is Anduril set up to deal with that? I mean, I feel like there's some people who might start intern and then take a gap semester and then wind up just hanging out forever. Tyler started as an intern and then he took a gap semester. Is Tyler required to dress like you every day? Well, yeah, we have like a general, if everyone's wearing it. White suits today because the markets are up. The market's up, so we wear white. Love it. But I am interested, like Palantir has the meritocracy thing going on. There's definitely this idea.

2:02:02I mean, this goes back to Peter Thiel and Founders Fund and a lot of just the idea that is the internship even necessary? What are the roles where the internship makes sense versus just, hey, you're ready, get in the lead? It's a perfect question, especially for right now because we're talking about this all the way through our executive ranks and with our people team about what it actually means to come here and what matters. And we call it the Anderil Forge Program, but we're working on the campaign right now that will be the next sequel, if you will, to Don't Work at Anderil. that won't tell people what we aren't.

2:02:37It's going to speak about what we are and what it means to work here and the importance of work. And so it matters way less to us about your quote unquote credentials. We don't care. We care about the work that you're going to do, the alignment to the mission and your ability to add value. Yeah, it's awesome. By the way, I don't know if you know this even, Jordy, but we started our campaign for Don't Work at Anderle with our intern taking over. so like midnight uh my buddy sean and i were crushing i think coars lights and then we we posted just simply don't work at anduril and we had somebody give us really good counsel because it was just going to be that and this this man of mystery uh that uh rhymes with don hoogan said to us he said you got to go way way harder than that like you got such a fertile ground like there's so much andoral lore that there's so many different elements that you could pull from uh from different things palmer said sword art all online building pacific rim robots uh so there's about uh 10 10 tweets that our intern wrote that are actually ghost written by i think i sent you like 25 and uh and and you picked you picked oh right right right i know i know this i think yeah uh yeah uh one day we need to post the ones that didn't make the cut because there might have been some over the line.

2:03:58So good. Last question. Do you think that advertising has changed in the last 50 years? Huh? Even in the last 100 years? Because when I hear you talk... You're speaking, running the marketing organization of one of the best modern brands. People can debate on whether they like the brand or not because it's obviously polarizing, but great brands are polarizing. And when I think about the strategy, it's like ultra clear communication, strong visuals, leveraging out of home strategically, having these sort of layered strategies, thinking about all these different architects. It feels like all the conversations that a strong marketing brand organization would be having 50 years ago.

2:04:49And so it's interesting. I think it's interesting that we have the internet, which is like the best marketing channel in history. And yet the marketing strategy hasn't changed very much at all since the Olgavi days. Yeah, what you're describing to me is that what's changed is the medium. What hasn't changed is the desire from an audience for a really clear story. And ultimately, that's what we're doing is we're bringing great craft to our storytelling, which most importantly is highlighting the incredible, important work that our engineers and operators are doing for our warfighters. And that's the thing that is consistent with us.

2:05:29And the other thing I think you said is that we understand that it's not for everyone. You know, what was important to us is that we have a really, really clear message that people understand what we stand for, whether you agree with it or not. And that is what I love because I'm so mission aligned to what we're building that I find it a great privilege and responsibility to bring the same type of disruptive approach to marketing that we are bringing to how we approach contracts, how we think about research and development, how we think about engineering or AI or design. And ultimately, there's no other place on earth I'd rather be.

2:06:04Fantastic. That's a great place to end it. Well, thank you so much for coming by. I'm so excited for the Andrel 250 next year. Next year. Can't wait. We'll be there. I want to be there. By the way, here's a final idea for you guys. This is my second time officially on. Yes. You guys need like an SNL five-timer jacket. Oh, yeah. When you guys get to that level. Yeah, that'd be great. I want to see you guys break out some new swag. For sure. We got you. We got some new merch on the way. See you guys. Great to see you. Thanks so much for coming by. What else? You got something else in the bag? What do we got?

2:06:34What do we got? Oh, there we go. Oh, very cool. The 24. That's great. Thank you. There we go. This is hard. This is very cool. Thank you so much. Good to see you. See you soon. This is good. Everyone needs a number for sure. There you go. I like that. Linear. Let's get back to Linear. Let's get back to Linear. Planning and building products. Meet the system for modern software development. Streamline issues, projects, and product roadmaps. there is a video of an office tour that has been burning up the timeline. I feel like we should play this. Play it. If we can pull it up. It's going to be about two minutes from Philip Cozera.

2:07:14I spent$1.5 million building our office after raising a seed round. $1.5 used to be the total seed round. Now I guess it's a$30 million. There's some$1.5 million Series A's out there. They're off. If you go back like 10, 15 years. So let's play this, and I will be back in just a minute. We're raised$30 million for this office. Let's go meet the CEO. What is this? You're here for an office inspection. I'm laughing because the camera's tracking John. Just to see where the$30 million went. All right, but let's be quick, all right? You going surfing? Yeah. See you later. Come on in. Let's track how many times they talk about surfing.

2:07:56We've got stand-up waterboards. We've got kite surfing equipment. They spent it on vibes. Coming through. This is gonna be the sauna room. We're now more like a sauna closet, but all of our kite surfing equipment is here, and our kayaks are here. Okay, I'm gonna count kayaks. This is Sebastian. He's one of our first investors. He joined the company full time. From one employee to 18 in a year. You guys are going fast. Everyone is doing something, having meetings. Product engineers over here. We got Robert. Robert doesn't actually do work. He's actually looking at saunas right now. Our new product is actually called sauna, because this man actually came up with the idea while zoning.

2:08:31They look cool. Where are they from? Hello. Where are you from? From Iceland. Matthias? That guy looks like he's the only one actually working. Our backend infrastructure engineers do not like to be disturbed. Matthias, where are you from? I'm from Austria. Can you point at the Golden Gate Bridge? It's right over there. Can we zoom in on that? Coming through. We got... Any fun stuff here or is it just nerd gear? Let me. All right, this is our movie theater, but how many times did you guys watch a movie here? Well, I actually tried to get Nikki to find our ps4 But unfortunately we work too much and we don't have time to do bullshit.

2:09:10One of my favorite things in the office I'm back I'm back. Okay. I have a take. I have a take. Let's break it down I don't know what this company does this they put out this whole video. They went viral, but it's unclear what they actually are selling like it they're selling nordic vibes yeah i mean the vibes are immaculate our european soul and i understand that it's like targeted at hiring because it's like hey you know we have this beautiful office you should come work here you should come build on stuff yeah the challenge is unless the company's like winning and getting better every single day the surfboards start to for sure like there was this quote post about like hey like you know look at what jeff bezos was working on the door desk back in the day.

2:09:52The other thing is like, there's a little, I think this goes over way differently if this is done by an external influencer. Like there's been so much attention on the gundo. I think that's kind of what's happening. No, no, no. Oh, wait, wait, really? Okay, it feels like it's the founder posting. He's posting it, but it's, I think someone else. Oh, I guess their product's Sauna AI. Okay, so they have a... Building the future of work with Sauna. We love saunas, so can't be too. Yeah, I mean. Oh, it's a two, you turn your to-dos into done. AI-powered workspace. It's an AI to-do list, something like that.

2:10:34But there were people that did this exact video on the gunda. They went to Rainmaker and they were like, look at the gym stuff. You can lift weights here. There's people over there working. or like, uh, I, I literally went and filmed a video somewhat like this, uh, at near us, although they were in like a garage and they were, they were literally grinding. They didn't have any surfboards. I have PTSD because I, I, I knew, uh, I knew a founder back in the day that every, uh, he would always go surfing because he needed to clear his head. And I would always be thinking like, okay, like eventually your head's got to be clear.

2:11:12You just got to fix the product and you can just fix the product and ship another product and make it work. Brother, I think if your head's unclearable, we've got a problem here. Yeah. And I don't know. As somebody who's grown up surfing, basically at least every week since I've been a kid, I don't find surfing, especially in Northern California, to be compatible with work. And the reason is that – Wait, it takes you out the full day? So the challenge is that in Northern California, even if you're wearing a 5 '4 wetsuit, which is like basically the thickest. Is it 5 mil? 5 millimeters on the chest or on the arms.

2:11:55What about 7 mil wetsuits? You can get those, but like you get that for like a trip to Alaska or something like that. And the challenge is you get cold enough, surfing in Northern California, even with a 5 '4, that you spend the entire like next like few hours. Like your body is. I just, I'm just laughing that we're like breaking down. Like, like, like if he, if he, if he lived just, just two hours South, it'd be totally fine. No, I disagree. Up there, it's impossible. Just analyzing the wetsuit. No, no. Let's call back the tape and see what type of wetsuit did he have? If he's in a, if he's in a 9mm wetsuit.

2:12:29No, it doesn't matter. It doesn't matter. You could be in a 5, 4, 4, 3, 3, 2. You could be trunking it. But you get cold enough that your body uses so much energy to reheat. and you just become slow. Yeah. You just become slow. Okay. And I would struggle with this growing up because I'd go surf after school and then I'd be doing homework and I'd be like, I can't think, I can't, like I just be, you know, incapable of real productivity. So I'm against surfing in the, During the work week, basically. Yeah. I basically don't surf during the work week. I'll surf sometimes in the evenings. But yeah, once you're done with your day, they could be doing that.

2:13:08They could be, they could have a surfboards. But he mentioned surfing or kiteboarding or kite surfing or surfing or kayaking like so many times, at least five times in a, yeah. Yeah. Ryan says there are many doing Don patrol in SF every day. I agree. There are, I just, I just wouldn't be a VP of vibes. Yeah. Yeah. VP of vibe, VP of vibes engineering customer vibe distribution. I certainly understand why people are saying that this is maybe a little bit too lackadaisical when you're in the trenches of the startup culture. It was also kind of clickbait because he said the effective cost is only$250K.

2:13:48Oh, interesting. Okay. So spent$1.5 million. And he got a bunch of like TI, basically. Okay. Well, that's cool. Anyways. Certainly seems like a nice place to hang out. And nothing will matter if you build the business. You could have made the same argument about Facebook. Facebook was drinking beers in the office. You know, there's a famous interview. Mark Zuckerberg sitting there chugging a beer out of a solo cup, a red solo cup. And he was, and the interviewer was like, are you sure you want to be chugging this beer in this video? And he's like, it's okay. It is just funny because. But you got to deliver a hyperscaler.

2:14:23If Tyler was. Drinking like this. If Tyler went kayaking. Yes. After the, after the show. Yeah. I would just say to him, like, why don't you just, and then came back and, and kept working. I'd be like, why don't you just do your work and then go kayak? True, true. Like, why do we need to combine these things? I don't know. It seems like mostly solvable if the kayaking, kite surfing, surfing marathon happens at the right time of the day. Tyler, put a calendar invite on our calendars for three years from now to check back on this WordWare video. We'll revisit it because if they have crazy product market fit, they're going to look what if the ceo they're going to look like into being a a world-class surfer and becomes like the next kelly slater and just actually shreds it just rolls the whole he's like we're a surfing company now i'm going to get on the tour i'm a professional surfer i we earn revenue when i win the biggest surfer yeah exactly that would be i would crush and then you'd be eating your words jordy you'd be eating your words no we very well we very well could be uh eating our words in in just oh yeah of course like the actual product you work gabe says why don't you bring your work to the kayak?

2:15:35I like that. I also like numeral sales tax on autopilot. Spend less than five minutes per month on sales tax compliance. Ryan says, I'm going to apply. Need somewhere to store my boat trailer. People just start applying because they need the place to store their gear. They're like, this place seems really well. I mean, at the same time, And when you're in a crowded market, the taste of virality, the temptation of like, oh, this is good content. We should go viral with this has got to be overwhelming. It's like no one's heard of the company yet. It's brand new. And you have this opportunity to go do something that can get a lot of attention.

2:16:18I think he invited criticism because he started it off with clickbait being like, I spent one and a half million on our office. Yes, yes, yes. Yes, there's a little bit of too far. I also, yeah, I think having someone else do this is better. Have an actual TikToker come by instead of doing it as an in-house thing. It just has a different aesthetic. Like if you get stopped on the street, what do you do for a living? That's different than paying someone to do a what do you do for a living video about you. I would say snowflake is going to beat and do one. That is one of the greatest videos ever.

2:16:57Just like Finn.ai, one of the greatest, actually the greatest AI agent for customer service. They're number one in performance benchmarks. They're number one in competitive bake-offs. They have a number one ranking on G2. Let's go to the Tyler cam again for some reason. What's up with Tyler? Is that the, oh, he's clapping. Do you want to, do you think we should have kayaks in the workplace? Yes. Yes? Do you like kayaking? Probably. Probably. I've gone like once or twice. Okay. Well, our next guest is in the Restream waiting room. We have Kaz from Open Door in the TV panel, Jim. Welcome to the stream.

2:17:35How are you doing? Here he is. Welcome. Thanks for having me, guys. I am pro-kayak. I want to go on the record as being pro-kayak. Pro-kayak? Okay, but kayaking in the workplace. Yes or no? At what point? At what point? at noon on a Tuesday, you want your whole workforce going into the frigid, ice-cold sea with a four-millimeter wetsuit and coming back cold and spending the rest of the day warming up? First of all, I grew up in Canada, so we don't wear wetsuits. We just go kayaking. I don't know what you guys do. What's the biggest fish you've ever caught? What's the biggest fish you've ever caught i am i i honestly man this is like my my brother-in-law goes fishing off the coast of british columbia and catches these massive salmons i am a i'm terrible okay i'm objectively the worst guy to go out fishing with that's just bad luck i will not catch you anything it'll be terrible oh wow i'll fix your wi-fi okay there you go okay there you go that's helpful uh well you caught a big fish with open door congratulations on the new gig uh i don't know if you remember but we've actually emailed very briefly while you were at Shopify.

2:18:45You saved my entire company in the span of two email exchanges. So I've always been extremely thankful to you and just Shopify generally. But since this is the first time on the show, can you give us a little bit of backstory on how you wound up at Open Door, what the vision was, just kind of how this all came together? because it's such a fascinating story to me. I mean, I think the story has now been fully leaked. I would not have told it if it just had not been fully told by other people. But look, I've been, I loved my job at Shopify. I genuinely honestly thought it was going to be my forever job.

2:19:27And I just, I was not planning on leaving, but I became a little obsessed with Open Door maybe February of this year where like I, as a kid, I grew up, my mom had a corner store and I grew up with a stopwatch timing the cashiers. So I have this very odd obsession with operationally well-run places and from the outside, Open Door looked like a great opportunity being poorly run. So sometime in February, almost as a joke that just ought and would just not leave my brain, I texted Keith, her boy, saying, hey, I'm thinking of just buying Open Door and taking it private. because it just needs to be run better.

2:20:11And then my wife, God bless her, just thought this was an interesting hobby for me to figure out how I could just, on the side of my desk, fix this company that I wasn't running. And I became more and more obsessed with it because there's a very real thing that matters, man. Most of us that work in software don't get the opportunity to say, hey, the thing we do has a real-world impact on actual families, right? And it's a very real thing that happens if you grow up in a home that your parents own. Like your educational outcomes are better. There's less crime in your neighborhood. Like same family, same type of thing.

2:20:52If they own a home, things turn out better. So I became just obsessed with this company whose job it was to make buying and selling a home easier. And like most other things in the world, when you reduce friction, you get more of the thing. So if you think home ownership is good, reducing friction in it will lead to more of it. But I had just kind of given up on this idea of taking the company private because the company had this significant run. And, well, I didn't have enough money to take it private anymore. There was a brief window. You were daydreaming about it. That was the time. Yeah, yeah.

2:21:29So then it was a Sunday, like in, I want to say mid-August, like late last half of August, my wife and I were on the way to church. I got a call from Paul Diversa, who's an executive director. And I picked up the call and I said, it's a true story. And Paul and I had, Paul had been trying to get me to go to a couple other places. And I picked up the call. I'm like, Paul, I'm on my way to church. I don't have time. I appreciate it. I'm not interested in whatever it is you're about to pitch me. Maybe if it's open door, let's talk. And then he said, it's open door. How soon can you be on a plane?

2:22:09And we went to church, came back, I got on a plane. And the whole thing, the whole process took maybe two weeks from that call to me starting. How much did you rely on your network to help you make that decision? maybe some trusted advisors, because I imagine there, when I, when I saw that you, that you were announced that you took the job, my immediate thought is like, you know, going from Shopify, which is this like beloved, you know, incredibly well-run company that you can have so much impact on because it's like one of the, one of the few platforms in the world that is just like so undeniably pro entrepreneurship and entrepreneurship is so life-changing.

2:22:53And if you care about impact, You know, it's hard to kind of meet your bar, not to mention that jumping in at Opendoor would go from probably like a relatively calm work environment to one of the most like crazy, intensive, high pressure environment where, you know, I'm sure from like the amount of inbound messages that you get running Opendoor is probably like 100 times the messages that like a company like 100 times your size gets. And so it is a wildly different kind of life. I don't know. I mean, look, I think Shopify is a relatively intense place to work for all the good reasons. And you kind of want to work at intense places because you only get one career.

2:23:41But I remember when I was thinking of leaving Facebook to go to Shopify, literally everyone I talked to said, don't do it. Every single person I talked to about leaving Facebook, going to Shopify, said, don't do it. It's a terrible company. It's among the most shorted companies in history. It was extremely shorted. It had a really bad opinion. It was churny. The day I joined Citron, put out a big research report saying Shopify will go bankrupt in 12 months. I remember everyone I talked to back then in 2019 told me, don't join Shopify. Terrible idea. And what did you see that other people missed?

2:24:26Look, I thought the mission was a worthwhile mission and that it was very clear to me that I was the type of person who could help. I thought the mission was important. The company had done a lot of good and I could help. I couldn't see myself at a bunch of other companies, but I could see myself helping Shopify. And I became the merchant services guy at Shopify. I ran the second half of the business. So Shopify has two parts, SaaS and services. I ran services for nearly my entire time there. And then Toby asked me to become the COO and I ran a bunch of other things. But I remember when I was thinking about going to Shopify, basically the only two things that convinced me to do it were I prayed and I thought it was the right decision.

2:25:15And I sat down with my wife and I said, hey, this is almost certainly a bad idea. Like we're going to move to like, we're going to move. We had a kid who was less than one. And this probably won't work out, but I think this is a worthwhile mission. And I think I can help. And she said, look, it's our job to spend our marriage doing things that will make the world a better place. We call it leaving a dent in the world. so when it came time to the open door one I talked to Keith because I've known Keith Reboy for a while but I talked to my wife I prayed and I thought I could have an outsized impact on the company just because the type of thing I tend to be good at is the type of thing that the company seems to need.

2:26:09I'm no one's idea of a corporate executive. I cuss a lot. I grew up as a nerd. I didn't do all that well in my finance undergrad courses. I'm a product manager. This is how I dress. It's a very real thing. But at Opendoor, it felt like I could do well given what the company's mission was. And I thought if we could do our job, it just would be good for the world. So, so yeah, what, what, what's the, how do you think about the opportunity? How do you think about the shape of the business in, are you thinking in a decade? Are you thinking in 30 year timeframe? Like, how do you think about the long-term strategy, what the opportunity is, what you want to fix in the short-term, medium-term, long-term?

2:27:05How you, like, We ship every week. Like we ship every week. Fuck 10 years. We ship every single week. Like our job is to ship product every single week to tilt the world in favor of homeowners and people working hard to become homeowners. We ship every week. Something changes every single week. We measure ourselves on a weekly basis. We now have a public dashboard that we use internally. We just publish it to the world. So you can see our internal dashboards externally. Yeah, so what are the levers that you can pull on a week-to-week basis? Like what's an example of something that you can, you can roll out that actually improves the experience.

2:27:39I mean, I can tell you, I can tell you a product that took us almost exactly one week to launch. We launched this thing called peace of mind guarantee. Okay. Um, so if you ever bought a house, I remember the first house I bought and the first night I slept there after we had closed, I'm like, shit, bought the wrong house. Like the first time, like that's a very real thing that happens because in the typical real estate transaction, the deck is stacked against buyers and sellers. Everyone involved has a conflict with the two principles. There's a real agency problem. So if you're buying your first home, the thing that makes you most nervous is missing something.

2:28:23So a thing we launched at Opendoor is this buy a piece of buying guarantee where you can buy a house from open door, move in, and if you don't like it in the first seven days, just give the house back. We'll take it back. And I think it's one of those things where if you buy something on Amazon and you don't like it, you'd return it. But for some reason, if you're buying something that's hundreds of thousands of dollars, you can get duped and there's no one to return it to. I remember, I think I must have been somewhat of a younger teenager when I figured out, okay, you make the most important purchase, biggest purchase of your life, buying a first home.

2:29:02And you don't really get like a try, like you don't even get to like try it out for a couple nights. And because it's just one of those things, as soon as you actually own something and you occupy it, you start, you start, you know, I noticed, you know, I bought a house last year. And I, the things I know, I, I, I missed so many things, like, you know, I ended up getting like lucky right it wasn't like i want to return the house but there were so many just small things that i noticed immediately from moving in that i completely missed and i was like wow thank god i didn't that that is not that big of a deal or it's like a uh a nice to have whatever dude there is a word for people who try to make money off you and then dodge town we call them carnies carnies like and we have turned like the entire real estate industry essentially into people whose job it is to like kind of hope you don't notice problems it's very weird like look we stand by every single home on opendoor.com yeah you buy it from us you don't like it that's fine first seven days we'll take it back yep and i thought this was this was good i didn't think By the way, you know what happened?

2:30:15From the second we thought we should do this to the time it was live was about seven days, genuinely. And the reason that was true is because there's a bunch of people in the path of doing this whose job it is at any big company to go, but actually, experts say this. There's risk or something. As a buyer, are you more likely to buy a home from opendoor.com if I tell you if you don't like it, you can return it? Yes or no? Yes? Great. Let's go. Do we stand by our homes? So it's a little bit of an actuarial puzzle that you have to figure out, okay, what is the cost for that? And then distribute that over the buyers of that product.

2:30:56That seems like something a technologist, a product manager, somebody who's a little bit more forward thinking is completely set up for. That makes a ton of sense. What else is changing in the market? I'd love to get your thoughts on the 50-year mortgage that was proposed. Is that good for America? Is that good for Open Door? Is that something we should be supporting? Yeah, people have been comping it to what happened with Japan's market after they introduced 50-year. Yeah, I did see some people say, oh, it might be bad. But break it down for me. Look, let me do the thing that I'm not supposed to do and answer the question honestly.

2:31:32I think that people who compare this to Japan are just deeply misunderstanding a bunch of things about the American economy. Like, let's just be clear. Like, the American and Western economies are just fundamentally different because culture is fundamentally different and economies downstream from culture. Like, it's a very real thing. That matters. But secondarily, like, let's go back. Democracy in America, Tocqueville. In it, he talks about how the main difference between America and every other country is that Americans own the ground they stand on. It has been historically true that Americans have had a higher ownership of the land that they live on than any other nation.

2:32:15And this has been basically the main difference between the American, I own this land, I'm part of this community, and the transient European and Eastern lifestyles, right? If you divide the worlds into people who are from somewhere and people who are from anywhere, America is full of people who are from somewhere. This makes a difference. This makes a real difference to how people are raised, how kids are raised, the economy, the country overall. Now, why is a 50-year mortgage incredibly important? You would not have needed a 50-year mortgage 20 years ago. You just wouldn't have needed it. In fact, when the 30-year mortgage came in, in 1931, I want to say, everyone literally said all the things they're saying about the 50-year mortgage.

2:33:01This won't work. It's too long. How can people pay it off? But the thing 50-year mortgage does is this. the 30-year mortgage was designed for a time when people didn't have student debt, where the average life expectancy was about 15 years shorter. The average work time was about 15 years shorter. Like, there's a very real thing where people are buying homes later and later. We just cross the average homeowner buying their first home at 40. Because student debt is crushing American debt-to-income ratios. What the 50-year mortgage allows you to do is to get into the market, which is the best market Americans have historically gone to.

2:33:40It's the main source of leverage Americans get access to without being a big company and being a fancy person, right? You get access to that leverage. You can do it while paying down your student debt. And once you pay down your student debt, there's nothing that says you can't refi and pay it down faster. But the 50-year does fix what's called a debt-to-income ratio for folks while they're getting started. And I think it is important. But hey, there's another thing that's important. The people who are against the 50-year mortgage are coming out. No one's forcing you to take a 50-year mortgage.

2:34:14You can still take the 30 or the 15. But what you're saying is, I wouldn't need it, therefore no one can have it. Well, guess what, buddy? Not everyone lives in Palo Alto. Yeah, it's interesting. One thing that came to mind for me was what you've seen in the automotive industry where typically 60 month is maybe like the, I imagine that's the most popular, right? And then there's 72 month. And if you look on sites like DuPont registry, John, you'll appreciate this. They have like a 200 month, you know, auto loan for supercars. And it's interesting that, you know, those have been getting pushed out.

2:34:55But the issue with cars is that they're assets that almost always depreciate massively and even on faster and faster time. Usually go to zero. Yeah, and even if you look at EVs now, they depreciate at levels that you haven't seen with ICE cars. So, yeah, I guess I think part of maybe the frustration and the reaction was this is a way to increase demand, but it doesn't fix the supply side. And so maybe it's focused on kind of the wrong. We should fix the supply side too. Look, I think we should take, we should understand what the government's saying. And they literally said this. They said this is one of the things we're doing, not the last thing we're doing.

2:35:42And by the way, in the last four weeks, they've also done a bunch of other things. They just changed the requirement on credit ratings. They just changed the requirement. They just announced that they're going to have a new FICO score in there. look, do I think they should do things to make supply more readily available? Yes. I think they've talked about making one-time assumable mortgages more available that will also change the supply, obviously. I think we should basically force cities to just stop being so anti-builder. Like the builders are desperate to build, let them build. I think there's a bunch of things we should do.

2:36:18This is a problem that was created over a decade. We're not going to solve it overnight. But one of the things we must do is fix this massive problems where American governments at the federal and state levels started subsidizing student debt to levels where everyone graduates with such a large debt they could not buy a house if they wanted to, even if they had a down payment. Yeah. Right? So we must do something to solve that problem. Otherwise, what's going to happen is people are never going to buy a home. And very soon, America is going to start looking like Portugal. And that's not what we want.

2:36:58Like, we know how good homeownership is. Yeah. What are your thoughts on stock-based comp? There was that Keith Raboy was getting in the fight with somebody years ago about stock-based comp. It feels like for some of these companies that are more mature, maybe you don't need to lean on it as much. but also there's certain accounting rules that make it maybe more advantageous to use it. Obviously, from the startup world, it makes sense to incentivize your employees with stock-based comp. But how are you thinking about it? Is there anything that is changing? Look, my salary is$1, right? I get paid$1.

2:37:40My entire comp is stock-based based on performance measures. You hit it, John. We're hitting the size gong for one of the highest salaries. infinitely more than$0 salary. That's right. Yeah. So I'm not, I'm not, I'm ideological on this issue, which I think for a very long time, corporate executives have gotten rich, driving their companies down in valuation and essentially failing their way to becoming millionaires. Right. This is like a very weird world where we've created where you are incentivized to suck at your job and do nothing lest you get noticed. If you don't get noticed, you're not going to get fired.

2:38:29If you don't get fired, you're RSU's vest and you become rich. This is the story of so many great companies. This is terrible. This is just terrible for capitalism because, as the American people rightly recognize, this is a scam. A world in which corporate execs get rich, shareholders lose money. That's terrible. I think corporate executives basically should only get paid in options. Now it's actually difficult to only get paid in options, I tried. But there's a way, we've essentially at Opendoor reconstructed options as RSUs. So the PSUs, if the stock goes below what it was the day I joined, I get paid actually zero.

2:39:13Wow. Like actually zero, nothing. And then there's like cliffs above that. dollar or you get to keep it with a$1? Well, I should know what the funny thing is. They should be able to claw back the dollar. I have to pay for benefits. I have to pay the company for taxable benefits. So I pay Opendoor to work at Opendoor. Which I think is perfectly fine, by the way. So this is sort of like, do you feel like you're in the lineage of Elon Musk's newest pay package, like heavily comp aligned to market cap. Is that where this is all going? I mean, I'm missing a couple of zeros. Okay. Yeah, of course. But I can't find a problem with that package.

2:40:00I love it. I just think it's so aligned. I think it's a very real thing. I think very few traditional executives would take it. Like very few traditional executives would take it. But I think what shareholders should want is none of those executives to be in charge of publicly traded companies. This is a very real thing. I think in the private world, a very good indicator that a startup's going to fail is if the founder pays himself a very large salary. I do some angel investing that my wife insists we list under charitable giving on our families. But in my experience, if the founders pay themselves a very large salary, the company's going to go to zero relatively quickly.

2:40:48Somehow, corporate executives get paid in cash$5-10 million, and in RSUs, another$5-10 million to basically be as inoffensive as possible and listen to the consultants. This is what happens. Listening to the experts again. Yeah, this is like a real man. You pay a comp consultant to come give you advice on compensation. Then you go to a management consultant to give you advice on management. Then you go to a financial consultant to give you advice on finances. Then you go to a PR consultant. And before you know it, this is what happened. I came to Open Door and I went through every bill the company had paid for the previous six months.

2:41:35Actually every bill line by line. I'm like, what was this for? What was the outcome? And the company, I paid them millions of dollars. It was actually, I think, number three on the expense item. We paid more for consultants than we paid for Snowflake, which is like tight or something. That's a thing, yeah. Wow. To what end? The company was basically going to zero. but fancy types who got MBAs from fancy schools do that to avoid being noticed and getting fired that's the goal and I think corporate executives should get paid only when they make shareholders money I like that a lot this was fantastic the chat is absolutely loving this I wish we could go longer we'll have to have you back you're welcome anytime time there's news or anything.

2:42:33George, do you have one last question for you? I have a lot more questions. I have a lot more questions. Let's make it a regular thing. We just have someone in the Restream waiting room. But thank you so much for taking the time. I'd love to go deeper. Also, I mean, I just feel like we can talk about like anything, really. Like there's so much here. We barely, when I asked about strategy, we, you know, spent five minutes on one particular product and we could do that probably every single week since you're shipping so quickly. I would say as there's more news on mortgages, both the assumable side, the term, you should come back on.

2:43:03We'd love to have you back. I think it's 30 seconds to do something. I promise it'll be only 30 seconds. Please, please. If you are watching this show and you're a founder type, the odds are you're an odd duck. You're swimming in the wrong sea. Find me on X. My DMs are open. We're hiring in offices. This is not a remote company. We're in offices with our colleagues working incredibly hard for a future that matters. So find me, and we'd love to have more folks join the mission. Yeah, we love that. Everyone's clapping here. I love your perspective and how you're approaching this, and I can't wait to see all the progress you and the team make.

2:43:43Yeah, highly recommend it. It's a generational opportunity. Cheers. Cheers. Bye. Let me tell you about Adio, customer relationship magic. Adio is the AI native surround that builds, scales, and grows your company to the next level. Our next guest is already in the Restream waiting room. We got Paul Needham from The Infatuation. Welcome to the show. Look at that background. That is very cool. Look at this setup. I love it. Thank you, guys. What a fun brand exploration. Very cool. Great to have you on the show, Paul.

2:44:15Chris, your co-founder, is a good buddy. And yeah, it's great to have you here. Thank you. Yeah, Chris and Andrew started Infatuation now 16 years ago. So we just celebrated our sweet 16 at Veselka in New York. Yeah, exactly. Longevity is a good thing. And we're really proud to be carrying the tradition on and to continue to shine a light on all the great restaurants all over the country. And that's what we're out doing this week is talking about our Best New Restaurants campaign. Let's talk about it. Break it down. All right. So our team all over the country and in London, we went to over 5 ,000 restaurants this year.

2:44:57Spots, bagel places, pizza places all the way, especially out in LA. You guys have a lot of fine dining, a lot of omakase. And we checked it all out and we crowned some of our favorites. So out in LA, places like Baby Bistro, River, Mustard's Bagels, Beethoven Market, and a bunch more. and then all over the country looking not just at the best restaurants. I really liked Jewels in San Francisco this year for pizza. Smithereens is our number one in New York. But also looking at the trends and what are we seeing out there? What are the threads? So obviously, martini has continued to... How many people do you need to properly evaluate 5 ,000 restaurants?

2:45:43Like what does a team look like to pull that off? I'm assuming it's some internal, some external. Some of it's internal, some of it's freelance. The fun of it is bringing your friends because, you know, you can't go to a restaurant as one person and try everything. And so we do a, and a lot of restaurant critics, the Times and other places do it also. But we bring some folks around. We dine anonymously. We book under fake names. We pay for all the meals ourselves. Call it as we see it. and yeah it's a big effort from a lot of people it's also we go back and so we want to give places that chance especially when we're talking about a best new restaurant category um want to give people the chance to really show their best um and yeah we have a team around 50 people who who work on this for us um and then yes and freelancers and other folks as well that makes sense.

2:46:38What is going on? Give us an update on the restaurant industry broadly. That was, you know, I obviously restaurants tend to reflect, end up reflecting the state of the culture and the economy. And there was some reporting last week that we touched on briefly that like McDonald's is seeing a drop in purchasing from some lower income folks. That was surprising. I think people were pretty bearish about that. Maybe there's a different story there, but, uh, talk about kind of the health of the, of, of restaurants broadly. I'm assuming it's like a, uh, it's a pretty wide disparity. Yeah. And it's a complicated situation because you've obviously got Chipotle and others who've been out talking recently, but then, you know, the wall street journal, I thought had a good piece a week or so ago about how in New York, the kind of rich are keeping the party going.

2:47:34um i think definitely when you talk to restaurateurs look folks in la have had a tough year no question i'm sure you guys hear that a lot um hopefully starting to come back and is that driven by the is that is that downstream from like the film industry not doing well so just people in the creative world film are just entertainment are just eating out less you need expense accounts you know especially if you got a lease in beverly hills or you got a at least in West Hollywood, like you need people to be able to put a corporate card down and, and spend a little more freely. But look, I think it's interesting.

2:48:14Also you look at some of those trends and then you also look at things like $10 pastries and really elaborate matcha drinks and these small indulgences that people are definitely still treating themselves to. I mean, And the cinnamon roll situation in New York had an outrageous year. Wait, is that the name of the restaurant? No, it's just you got one. I thought a restaurant called the cinnamon roll situation. It's a steakhouse. It's like we got a situation down here. It's a situation that we're monitoring. It's a situation. But I was on Squawk Box this morning in the Today Show earlier, and we brought pastries to all that.

2:48:56And it was like one cinnamon roll just got crazier than the next. And so definitely like, I think the restaurant industry situation is a big complex narrative across QSR, across fine dining, et cetera. I think the customer indulging themselves, treating themselves as another situation. And then look, there's no question that people drinking less is a huge factor for restaurateurs and the folks who were all, you know, friends within the industry, like definitely, if you're not selling wine and you're not selling cocktails, that's a mighty headwind. That's your profit margin. Yeah. But look, you see the$20 mocktail on a lot of menus now.

2:49:39And definitely folks are trying to make the non-alc stuff happen and trying to make some money off non-alc. But it's definitely a much. Yeah, so from what you're hearing or seeing, some people have gone from drinking to no drinking, and then a lot of other people have gone from like heavy drinking to just moderate drinking. And so they're seeing like both types of guests just kind of like spending less. I recently went from no drinking to heavy drinking. It's been great. You guys are keeping the industry afloat. Look, I think there's a lot of people. Obviously, wellness is a huge like factor in so much stuff.

2:50:21We also see that in the hour people are eating. So all of a sudden, 5.30 is a really hot time to go to a restaurant where a few years ago you were embarrassed to ask someone to go to dinner at 5.30. I think there's a lot of people... It's so clearly the problem. I like to go to dinner at 5.30, sometimes 5. I don't like to be digesting food when I'm going to bed. Yeah, I like that. And I have one drink a month. Our audience is a lot of tech people. Do you have a recommendation for a restaurant that might be particularly good for planning a coup? If you're planning a boardroom coup or maybe celebrating a successful boardroom coup, do you have a recommendation for a restaurant?

2:51:05And this needs to be in like the South Bay? I mean, ideally San Francisco, but boardroom coups are happening all over, maybe in New York as well. San Francisco, look, a lot of great places. I mentioned Jules Pizza earlier. That's where I would plot my coup. Is it quiet? You're not going to be overheard there? There's like some corners. We could tuck into a corner. We could tuck into a corner. The mayor was there recently and was like blowing them up. Okay, that's good. They're where the action is. Yeah, I feel like the proper environment to plan a coup is sort of like leather booths. Ideally some mahogany.

2:51:42some mahogany something like very where every little booth is like nestled off to at the side no one can really see each other too much you know in new york a new york little interesting development this year that did not get a lot of attention but for charles opened a private dining room and so for as hard as is to get a reservation for charles the private dining room if you got like 12 grand for a table of eight okay they will have you any night you want and it has tens of billions of dollars at stake. So what's the point of spending 12K on a steak? That's no problem. Yeah. I always like Pacific dining car in LA.

2:52:18That feels like a good place to plan a coup. I like a mafia movie vibe. How, how is, is, is, is Instagram still having the, like, so, so I don't, I don't identify as a foodie at all. I, I enjoy food. I don't, I don't spend a ton of time like seeking it out, but, um, uh, it, there's been a lot of conversation over the last probably decade now around how, uh, Instagram is just driving every city on earth to look the same. So like, no matter where you go in the world now, you can get like a matcha and you can get like New York style pizza from somebody who was maybe in living in New York, like two years ago, whatever.

2:53:02Uh, is there anything like, is there any parts of the U S that are kind of like fighting back against that and like really trying to create a more localized food culture and is that even possible anymore yeah i mean i think definitely everything you're saying you see like the matcha thing get crazier and crazier month by month i saw lauren sherman said over the weekend like matcha is like kale like people are just doing things to matcha that shouldn't be done um i think you've got you know pizzas everywhere no question and really good pizzas everywhere and to your point like mexico city is everywhere now we're like every new york city right like every new york big opening this year is like mexico city inspired in some way or another um i would say like nashville i'd point to texas like i there's definitely pockets where you're seeing people really do something that's very unique i think miami has been an incredible food scene for us in the last few years and definitely miami even if it's not cuisine per se like the personality of a miami restaurant sunny's which is one of our favorite steakhouses down there like that restaurant could only be in miami and you definitely like feel that you're in miami when you're there but look beethoven market when you're sitting out on that terrace in Mar Vista, there's stroller parking.

2:54:30It very much feels like, oh, this is the west side of Los Angeles. And Wild Cherry, which just opened in the West Village of New York, which is the A24 restaurant, it very much feels like, oh, we're in a New York canteen connected with a small theater. So there's definitely still places that are creating that sense of unique personality. This is very cool. Thank you for coming on and giving us the update. Yeah, guys. I've held out, by the way. I haven't had a matcha in at least a decade. I tried it a long time ago, and I haven't gone back. It's not for me. Yeah. It's not for me. We'll send you.

2:55:07There's some good powder ones you can make at home. They're really easy and pretty good. Fantastic. Thank you, guys, and congrats. Everyone's watching, man. Everyone's watching. Thank you for coming. Thanks so much, Paul. This was a lot of fun. Thank you for giving us an update on the state of the market, and congrats on the lunch. We'll see you. Have a good one. Yes, sir. Let me tell you about public.com. Investing for those that take it seriously. They got multi-asset investing, industry-leading yields. They're trusted by millions. We are completely switching gears now from food and beverage to Jordan Nanos at Semi Analysis, taking us through the latest from ClusterMax.

2:55:42This is ClusterMax 2.0, correct? That's right, yeah. What are the biggest findings? How do you introduce ClusterMax in the 140 characters version? I'd love to just get into the actual findings. Yeah, well, it's great to be here with two of my technology brothers. Thanks for coming. I can definitely take you through ClusterMax. Basically, the way we see it, some of the most critical transactions in AI are happening when people are renting GPUs from a provider. So this is companies like CoreWeave, Navias, Lambda, Fluidstack, Crusoe. So they've been coming to market and taking share from AWS, Azure, GCP, Oracle.

2:56:26And I think a lot of people basically, they think that all GPUs are deployed the same, and that's definitely not the case. So we go through in this article a lot of details about how our hands-on experience and then feedback from customers kind of makes it clear that it really depends which provider you go with when you're making a critical decision like where to buy your GPUs. Yeah. How do you actually feel like you're getting accurate data? Because if a semi-analysis email shows up and I'm running a NeoCloud, I'm like, yeah, let's put them in the best data center we have, I imagine. It feels like blind taste testing.

2:57:03We were just talking to a restaurant reviewer. I feel like you're a data center reviewer. These segments are actually pretty similar. Yeah, you guys need to create fake companies, even get them into YC and just sign up. Yeah, something's going on. But yeah, talk about the pitfalls of the process or how you actually tease out what's actually going on yeah i don't know if we're really doing a secret shopper thing quite the same like i definitely get cto on the phone in some cases to walk us through the greatest but um in my research i talked to 140 different customers of these neoclubs to get their perspective on exactly what their experience was with reliability and support at scale and i think it was quite revealing because um like i said yeah sometimes you get a really good experience in one data center that's quite different from somebody who's running stuff in Iceland or something like that.

2:57:47So what changed with this version? I know that the actual graphic has exploded. There's going to be more data centers. Do we need more neoclouds, by the way, or are there enough? Do we have enough? But yeah, what else did you find? Hey, we need more, man. We need more of it all. Let's hear it for more.

2:58:12Thank you for the tireless work indexing the entire market. Yes, but what were the findings? Yeah, look, I think we probably don't need a lot more Silicon Valley-backed venture startups that are all renting GPUs from another provider and selling them with a bit of software on top of them. But we're seeing a lot of the sovereign AI projects just get started, And it looks a lot like a telecom build out where, you know, different regions or countries have their own regulations or, you know, their own sovereign wealth funds that are funding the build out of a bunch of GPUs. And I think that's just getting started.

2:58:51So you're right. The biggest difference is we covered 84 neoclads this time as opposed to 26 last time. Our total market view, there's now 213. Learned about four of them since we published last week. I mean, if you're a neoclad and you're not on the list, it's probably fair for the investors to send you that and be like, hey, what happened? I mean, we're doing our best to get coverage, but they pop up all the time with different people who are in different phases of actually launching. Yeah. But yeah, what are the biggest movers? What were the biggest surprises? What were the biggest changes?

2:59:27Because it seems like CoreWeave has done well last time, this time. but there's probably some other folks who have taken your feedback and actually made changes. Yeah, I think probably the two big ones are that FluidStack debuted at Gold. We did not rate them last time, and they're kind of coming out of nowhere with a really interesting offering for taking other, let's say, bronze or worse tier GPUs and making them usable for Frontier Labs. They have some really, really big customers. I think Google improved a lot. If the market had really shifted to using strictly Blackwell GPUs and wasn't still stuck on using some of their old Hopper GPUs with their older networking, I would have seen Google possibly push to gold.

3:00:16I think they will in the future. They've been really improving. We've got a lot more work to do with AWS, I think. they're really focused on EFA and the rest of the experience is coming along, but their networking is just, look, it represents like less than 1 % of the cluster TCO by our calculations. And the users tell us it's like more than half of their debugging time is trying to figure out AWS's custom networking on some of these clusters. So we'll see who takes the feedback and who doesn't going forward. We try to be effective and include a lot of stuff from those customers in there as opposed to just a micro benchmark that we run on the network ourselves.

3:00:53Yeah, that's super interesting, Jordy. Wanted to get your read on depreciation schedules. I feel like this is a big debate and something that's going to be critical to the health of a lot of these players. And as chips get better, you would hope that the depreciation schedules would expand somewhat. but we're seeing it all over the board in terms of how different companies from hyperscalers to some of these new entrants are actually planning around depreciation. And I would love to kind of hear how you think about it broadly. Okay. I think broadly speaking, depreciation is a financial metric that's hard for us to measure and varies between the different providers quite substantially where people take different approaches from three to six or longer years.

3:01:48In terms of the lifespan of the actual technology, there's two ways to think about this. One is how long does the thing keep running well before it starts to have a lot of wearout failures like the GPU and the system? And then the other one is how long is it useful on a performance per dollar basis. And I think that second one really depends on how good future GPUs are. So right now we are seeing providers who are limited on power. They literally have no more floor space in their data center, rip out perfectly good GPUs that are making them plenty of money to replace them with the latest and greatest because they can make even more money.

3:02:29And so if that power constraint goes away or the newest, latest, and greatest GPUs don't give you that massive performance increase, then I think people will sweat the assets for longer functionally in the data center. But I think a lot of people on the financial side are playing a guessing game or they're designing it based on how they want to design the financials of their business and not necessarily taking into account exactly how the GPUs perform or what's coming down the pipe. is that is that bad i don't know if it's bad i think it's just pragmatic like if you look at a hyperscaler and you see that they have all of these buildouts of new data centers coming online and they want to um look they want to address the needs of that customer base and things just aren't coming fast enough ripping out old gpus and putting in new ones seems like it's a good play It seems like it's good for the people who want the best performance.

3:03:27It seems like them, you know, they're going to get more revenue per megawatt with the latest and greatest. I don't think it's necessarily good or bad for anybody. What about, so Satya has talked a lot about wanting a diverse GPU fleet, fungibility of the fleet, not wanting to just do exactly what like a key customer like OpenAI wants. If OpenAI says, hey, build this data center for this specific training run, he's not immediately saying like, yeah, of course I'll do it. No, no questions asked. He's sort of like, you know, being pragmatic about it. How much do you worry with some of these other Neo clouds about being like two indexed to a specific type of like workload or tech stack, uh, given how fast the, you know, space is evolving and ending up in a situation where they just have a bunch of dead weight.

3:04:21Yeah, that's a really good question. And I think you're segwaying into an article that we got coming out later this week and a fun interview that some of the guys did. So let me try and not talk about that while still teasing it. Basically, yeah, I think the concept of fungibility is really important to the hyperscalers. And it seems like in some ways they are exploiting the neoclouds for better or worse who have, you know, four sites. And they're going to take a whole site and have it all one chip. And that's going to be a bet for three to five years. and we'll see what happens after that. So in some ways, investors kind of view this as returning the AI market beta versus getting some alpha on an individual chip or on an individual workload.

3:05:16And I think it's, look, there's a lot of upside in this. And to your point, that focus on fungibility or pragmatism may have led to Microsoft Alert losing like$320 billion of RPO to Oracle announced a couple of months ago at reasonable margins. So I think time will tell on that decision. At some analysis, generally speaking, you're going to come to us and get a pretty bullish take. We were way ahead of the market on that Oracle print last quarter. Let's give it up for bullish takes. Yeah, that makes sense. With fleet fungibility, when you see on ClusterMax, there is Azure, and then there's also a bunch of NeoClouds that have partnerships with Microsoft, like Nebius.

3:06:07How does that actually work if you're a lab and you go to Azure and you say, I want GPUs from Azure, and then Satya says, oh, I have some over here through Nebius, and then I'm dealing with the intrinsic details of this. Part of me, though, is who do you think is going to be able to make the better call? Microsoft and Satya or Oracle when it comes to capitalizing on all that demand from open AI, right? Who has more information, who has more experience, you know, working with open AI, who has, you know, handling these, you know, training runs. It's like, I don't want to, I don't, yeah, again, time will tell, right?

3:06:51It could have been like the most brilliant move ever from Oracle, but at the same time, I have to imagine Oracle is like, basically, we had a graph last week on kind of understanding where the AI players sit on this idea of like, how much they need like AGI versus don't need AGI and how much they believe in AGI and how much they don't. And we were putting Larry like way up in the left corner of like, needs AGI, but doesn't necessarily believe in it. or hasn't issued public statements about it. Hasn't issued public statements at least, but I just feel like very much like a Hail Mary from Oracle.

3:07:35And if the depreciation schedules are quite a bit different than what they're planning, OpenAI will have gotten the much better end of that deal. And I think Satya could end up looking pretty smart for not going after it, but who knows? Yeah, I mean, I tend to agree. I don't think Sacha's looked dumb very many times in his career. I think he gives very thoughtful answers when it comes to this stuff. I do think, in some respect, it's a matter of timing. like if you look at what Microsoft's build out looks like right now they're accelerating and that's on the back of open ai but also some of their sas products that are using this technology they have access to all of open ai's ip through 2032 so they're certainly exposed to any upside on that side and yeah it's it's a matter of when you want to take your free cash flow down to zero to do a build-out.

3:08:36And Oracle seems to be the first one to have moved while Microsoft flinched a little bit. And then that's the result. It's a game of chicken. Hyperscale chicken. What did you think about, feel free to give your personal views. You don't have to share the official point of view of semi-analysis unless you want to. But backstop gate last week, I think you guys had probably been privy to conversations or heard, you know, it's not the first time that the idea has been floated around. I mean, we're seeing sovereign AI in other countries. I'm assuming we'll see some version of it here. But what do you rate the likelihood that we could see a scenario where the government would effectively be guaranteeing loans for AI, you know, data center build outs?

3:09:33yeah um i don't know how much uh i have an opinion on that when i read into it it seemed like they weren't actually asking for a backstop or a bailout the yeah and i i agree i agree with you there i'm not i i my our our understanding of it was it wasn't asking for a backstop on open ai or any type of bailout. It was just like the language implied that they would be open to a world where data centers would be treated like some other categories around national security, like manufacturing, where the government would basically want to encourage the development of data centers by saying, like, we're going to guarantee these loans, which would just encourage lenders to have more confidence to lend against assets that might depreciate faster than people think and present some risk.

3:10:30Yeah, and I 100 % agree in terms of guarantees. We see this elsewhere in the world quite substantially where there's governments in the Middle East, Norway, Canada to a small extent, Indonesia, Korea, Japan, India. They're all getting in on building a neocloud. and the US government has not gone out and built a NeoCloud, but they certainly build supercomputers for defense, intelligence, research. And they certainly have a vibrant community of companies. So I think there's more that the government can do to accelerate the time in which you can build a data center behind the meter, which a lot of places are trying to do right now without interconnect.

3:11:20In Semi-Analysis, we've got an energy model coming soon that's sort of a companion to our data center model. We've got guys on the team working on that who were grid operators in their previous job. And they've got a lot to say about the lead times to get turbines right now or how much red tape there is to get nuclear, wind, solar online. how you need guarantees from the utility, even if you're behind the meter, as some sort of, you know, future interconnect agreement or some sort of stabilizing power load. Or, I mean, there's just so many creative things that could be done with the grid in the US that I think are kind of fundamental before you can have discussions about financing a lot of stuff.

3:12:05Because, look, when we get in conversations with investors, I think there's a whole bunch of capital to be unlocked in the private equity space that is just getting started. And it feels like early innings because VCs are the first ones to move and they have in the neocloud space. But we haven't seen a lot of like institutional players decide to make a bet on this the way they have with energy, with housing, with commodities. and if gpus are going to be fundamental and they're going to be a commodity and people want to bring like an h100 index to the market you're going to see a lot of like institutional capital try and pour its way in here yeah and like functionally how does that work i think it actually comes in terms of like accelerating the existing data center projects as opposed to having the u.s just start to build something new oh sure so to that extent like totally agree with everything um i think the market kind of shuddered at those comments because it seemed like they were asking open ai is asking u.s government to pick a winner when that is clearly not the case like there are winners and losers being shaked and shaken out in like chat research coding but we're in the early innings of video and image generation of material science of drug discovery of weather prediction, all of these models that are showing incredible early results from transformer-based architectures running on the same GPUs as the chat models that could be the, you know, lion's share of compute in the future if suddenly everybody wants real-time generated video on their feed or we're making small weather predictions for everybody who's getting ready to go skiing or something.

3:13:46Like, yeah. Fascinating. I would like to see more AI on the slopes. On the slopes. I like the sound. Bring it to Vale. Semi-Analysis can do a ski trip, invite all the different players in bringing AI to the mountains. That's fascinating. Please invite us. Yeah. Very excited for the energy model. You can call it Powder Max. Whoever's working on that, as soon as you launch Energy Max, we want to talk to you guys. We always enjoy talking to everyone at Semi-Analysis. such thorough research, such deep insights. We really appreciate you taking the time. Yes. Great to see you, Jordan. Thanks for coming on.

3:14:27We'll talk to you soon. See you guys too. Yeah. You're welcome to Whistler anytime. Amazing. Amazing. Let me tell you about adquick.com. Out-of-home advertising made easy and measurable. Say goodbye to the headaches of out-of-home advertising. Only adquick combines technology, out-of-home expertise, and data to enable efficient, seamless ad buying across the globe. Our next guest is Isaiah Taylor from the LAR Atomics. Congratulations, Isaiah. How are you doing? Look at this. You look fantastic. Suited up. Congratulations. Second time on the show. Give us the story. What happened today? Yeah, first of all, the Eagle Screech was fantastic timing there because we have our beautiful nuclear test site out in the back here in the middle of the Utah desert.

3:15:08Fantastic job, producers. That was me. That was me. That's Jordy. That's Jordy. I'm sorry I stole the soundboard glory no they generate the sounds and I time them so I figured so it's even more impressive because the producers were cooking that up in the 5 seconds from when they saw my background then you could hit play we got so many sounds I got sounds for days that's exactly what it sounds like when one of our nuclear reactors starts up we're having a great day it's an amazing day for Valor Atomics We announced a$130 million Series A earlier today. Fantastic. Let's go. Nice. Congratulations.

3:15:52That is a proper gong. That's your Series A. It's a Series A. I feel like you had raised a Series A before. Wow. No, it was a C. I didn't realize. That's right. We announced a$19 million seed round earlier this year. Yeah. And actually, we built our reactor on a seed round, and we didn't turn it on. So now we have enough capital to go turn it on. Okay. And this is something I'm super proud of the team for, by the way, because I think this is like how venture is supposed to work. You hopefully turn something on in the Series A. This is like when you find product market fit. So I'm super proud of the team.

3:16:24This is our goal. Go split the atom with this capital. Yeah. I mean, yeah, the whole story here makes so much sense because like you started with like the really, really big vision, like turning, you know, nuclear power into energy that could be transported. actual like you were going to synthesize hydrocarbons and you laid out this big vision but then that was almost like act three and then act one was like can we actually build something that doesn't even turn on but just shows that we can actually build something then let's go turn it on let's start generating energy then if we have abundance and tons of energy then let's figure out what next to do and i think people were always like a little bit thrown by how far you were thinking into the future and they were like well let's see what this guy can do in six months and you delivered on the six month project.

3:17:10And now I think people are waking up to what you're building. Is that how you've experienced it? I think that's, that's an accurate perception. And I've certainly learned a little bit about how to pitch the story. We, I talk a little bit more about the short term now, but I think about the longterm every single day. Um, I mean, this, I think of this as my life's work. Energy is, is a very interesting thing where there's obviously an enormous amount of demand already, right? There's trillions of dollars worth of energy demand. But it's one of those things where if you make a lot of it and you make it very cheap, it creates its own demand.

3:17:42And I don't think there's really a limit to that. Like the more I play this out in my head, if you can make energy cheaper, you open up these new apertures of places where you can sell it and things that you can do with it. And so that really is like the fundamental motivation. And the thing that we're trying to do here is that I think energy should be 10 times cheaper than it is right now. And you're right. That's like a really long-term vision, but you have to be able to be super concrete and build stuff right now, six months, 12 months at a time. Yeah. So, I mean, the original vision, still very cool.

3:18:14I don't think, it doesn't sound like you're losing sight of it. I don't think you should. But the, I mean, we were just talking to Semi-Analysis about the build out for AI data centers, and it feels like energy is the bottleneck. The question of, we will probably be able to scale up the GPU production, but getting enough energy at the right price is probably going to be the next thing that we're talking about all next year, the year after. And there's going to be this question of like, where's the energy coming from? It's going to be a political issue if it's oil and gas, maybe that should be oil and gas in the short term.

3:18:48But in the long term, I think most people agree nuclear and solar. And so how are you thinking about the broader story here with America's renuclearization? There's a bunch of companies that are working on this. What are the timelines? What are the key things that need to happen? How's that looking? Yeah, I think AI needs power in the next couple of years. That's pretty obvious. And, you know, I was at an event with Tyler Cowen and Sam Allman a couple of weeks ago, and Tyler asks him, you know, what's the only thing holding you back? And he says, electrons. And Tyler says, anything else, chips?

3:19:21And he's like, electrons, right? So that's pretty clear. And then the follow-up question was, what's the nearest term way to solve that? And Sam says, natural gas. And I would generally agree with that, and I think that's probably true for the next 18 months. We do want to make power for data centers in 2028, though. And the interesting thing about nuclear is that I believe it scales very differently to natural gas. Natural gas is very site-specific. You need to go find good gas sources. You're working on routing. There's all these complicated things. Nuclear, you can kind of do wherever it makes sense, and you can put a lot of it in one place.

3:19:55The reason for this is uranium is just easy to move around, right? Kind of a year's worth of it fits on a truck, unlike a natural gas pipeline where you're working on the actual in-ground logistics of moving gas around. So I think once we've gotten that cracked, like the first unit that's making power, we could just make more of them. And you end up seeing these big sites that people are sort of dreaming about today where you have a one, two, three gigawatt AI data center. This is very easily deliverable with the nuclear reactor that you just mass produce, right? Because You don't have to worry about these gas logistics.

3:20:26Yeah. But how do you decide, like, if we're doing one gigawatt, that means we, I mean, the last thing we talked about was, like, maybe targeting 10 megawatts. So you need 100 of these things. Like, why 110 megawatts as opposed to 1 ,001 megawatts or 10, 100 megawatts, right? Like, there's some tradeoff. How'd you land there? Yeah. So our unit will be a 25 megawatt electric unit, approximately. Yeah. So that's about 40 reactors per gigawatt. And really the reason here is I just think that in the West, in the Western world, we're really good at making bus-sized objects. And if you try to make an object bigger than a bus, you have a hard time.

3:21:06We used to be good at this, right? We used to be really good at large-scale, like Hoover Dam, big nuclear reactors, yeah, spatial, this kind of stuff. But if you notice how Elon sort of revolutionized rockets, he actually downsized pretty significantly, right? The Falcon 9 is a smaller rocket than any of the heavy launch vehicles that took us to the moon. And then he kind of slowly worked his way back up to Starship. And even Starship is taking longer than you would have expected. So there's just something about the tool sets that we have, the way that we do engineering, that favors making objects smaller and making lots of them.

3:21:40There's a big part of how you just put it on a truck. I talked to some early SpaceX people about that, and they were like, you can put the engine on a truck. Once you go any bigger, it's like get out the crane every single time. you want to do anything. And so if you can do just little less crane work, it just compounds and compounds and compounds. What are the key risks to the business over the next 24 months that you talk about internally with the team, things that you're trying to prove out? I think somebody, haters could have said a year or so ago, you can't build a nuclear reactor with$20 million, you de-risk...

3:22:16You'll need 153. You de-risked from a capital standpoint. Now you're much less capital constrained and you certainly doesn't feel like there's a lot of risk on the demand side, which is like, if you can make cheap energy, will people want this? I think we know the answer there. But what are you kind of like focused on internally? Yeah, that's exactly right. And actually, I think people are massively over-focusing on every risk except just the technical execution. You mentioned there's a lot of demand. I think you'll see a lot of companies put out MOUs. They'll sign deals. You'll see this company send a deal with Google.

3:22:56This one sent a deal with Amazon, this sort of thing. One of my actually biggest Twitter haters I'm going to have to shout out, unfortunately, because he wrote such a good tweet. And somebody sent it to me that I was like, damn it, I'm going to have to shout that one out. one of my big Twitter haters, Nick Teran shout out to you Nick, said I'm issuing a universal MOU to all nuclear companies me Nick, I'm saying I will buy $10 billion of energy from any nuclear company that can actually build a nuclear reactor on time and on budget at a good price so I think this is actually totally right there is so much demand and the thing that's missing is capability, the thing that's missing is actually turning reactors on so the risk is entirely we have to go build this reactor and turn it on And this is, I think, essentially what sets Valor apart from basically everybody else in nuclear today is that when we started the company, our core conviction was that nuclear has to go back through R &D again.

3:23:51We sort of assumed as an industry that because we built many nuclear reactors in the past that we still know how to. And I think that's fundamentally wrong. And this is sort of our belief from the beginning that we have to go back through R &D. R &D means starting small, starting low power, building it very quickly, testing it fast. and that will lead us to a commercial unit. But there is just real tech risk along that path, right? You know, pumps don't work like you thought they would. Seals don't work like, you know, they don't hold as much pressure as you thought and you iterate through it.

3:24:21Is the tech risk, I mean, it sounds like the tech risk generally is a little bit overrated because this technology fundamentally, like it did work 80 years ago. It did work, you know, in the 60s. I mean, there were some problems in certain areas. Yeah, but even going to the moon is somewhat of a lost art. Yeah, I get it. Yeah, I would put this into the bucket. It's not science risk, it's tech risk. Tech is really about engineering and capital. It's about what are your timelines? Yeah, economics, engineering, capital. What are your timelines? How much money do you have and resources to do it in the right timelines?

3:24:53And that's why our focus has been small steps executed extremely quickly. I started this company about two years ago. It's been about two years and two months since we started the company. We built our first nuclear reactor within 14 months of founding the company, and we're going to hopefully turn it on before the three-year mark. And if you can move at that pace, I think you can sort of iterate your way. You get more shots on goal, right? Moving quickly means you get lots of shots on goal. So if the seal doesn't work right exactly the first time you do testing, that's fine because you have some time to go and test it and iterate that seal and that valve.

3:25:26Are you moving the family out to Utah yet? Are we going to see a Valor kind of like planned development with a bunch of – Oh, that feels very on brand. I like to see a bunch of mid-century homes set up. I will say we do have more RVs than I expected at the site right now and a lot more on order as well. Yeah, the housing out here in the desert is going to be an interesting challenge to solve. We're not just building the reactor building here. We also have a Triso fuel plant that's going up as well. So we're actually going to be making our own Triso fuel. So yeah, we're going to have a really fun operation out here.

3:26:01And that's only the beginning. Very cool. Congratulations on the progress and the round. I'm super excited for you and the whole team. Awesome group of investors too. I have to shout out Doug Philippone, who loved this round, ran Global Defense Talenteer for, I think, 17 years, started Snowpoint, ex-Army Ranger, JSOC Commander. Awesome, awesome guy. Not in this photo, but I actually arrived on our site here for the groundbreaking in a Black Hawk helicopter with Doug, which was fantastic. It's a great time. The suit in the Blackhawk goes unbelievably hard. It goes quite hard. Pedram Shiroff and Richard Blankenship as well from Dream absolutely made the magic happen on this round too.

3:26:48Fantastic guys. Really, really grateful for all our investors. And Palmer's in. I remember last time me, you, and Palmer were together, you guys were in a fierce debate and you clearly wound up seeing eye to eye because now he's in the round so congratulations on that. Yeah. Yeah. I think we were debating about how much uranium we have. Um, there's lots of it guys. Oh yeah. A lot of uranium to use. Yeah. Yeah. I mean, someday, someday we'll get the fusion, but not before we're all living in like O 'Neill cylinders, uh, with, with more energy than energy than we know what to deal with. Fantastic.

3:27:19Uh, well, I'm, I'm very excited for our nuclear future. I'm excited for what you're building. And, uh, I just want to say massive congrats. I remember, We filmed a very brief interview in El Segundo probably around two years ago. You didn't even have an office yet. And it's been what a fantastic run. Congratulations on all the progress. Amazing stuff. Thanks, John and Jordy. We'll talk to you soon. Cheers, dude. See ya. Let me tell you about 8sleep.com. Get a pot five ultra. I just reached for my phone. Check my store. Five-year warranty. Score. 39 risk-free trial. Free returns. Free shipping.

3:27:53I am unfortunately away from home. Oh, you're away from home. Yes, you're on the road. I got an 86, seven and a half hours. Our next guest is Grant from Gamma. He's in the restroom waiting room now. He's in the TV panel. No, this is Hayden. We got Hayden first. Oh, fantastic. Welcome to the show. This is a last minute ad, I guess. Squeezing in. Hey, how are you doing? Super excited to have you on the show here. We have, as you know, a Uniswap alum working on the team. We're very, very grateful to have him. And it's great to meet you. Yeah, great to meet you both. I actually wasn't planning on doing anything today, but now here I am.

3:28:35There you go. Yeah, great to be here. Awesome. For anybody that has been living under a data center, introduce yourself and Uniswap. Yeah, so I'm Hayden. I'm the founder and CEO at Uniswap Labs. Uniswap is the largest decentralized exchange in the world. So for some context, if you annualize the past couple months of volume, it does about$2 trillion a year in trading. you know it's when you think about what a decentralized exchange is it's kind of you know you could think of us as like a a youtube to a coinbase or binance's netflix right so we have the upload function um and so people can you know create their own markets uh we introduced this whole system called automated market making which lets people create liquidity themselves and so it sort of dramatically lowers the cost to the creation and access of financial markets and And we're sort of one of the pioneers of what people call decentralized finance, which is this area of crypto that is focused on building decentralized, transparent financial infrastructure.

3:29:39And so Uniswap is the leading decentralized exchange in that industry. Amazing. So we were live when your post hit the timeline. We have it pulled up now, but it would be awesome for you to kind of run us through kind of the news and break it down for us. Yeah. And I can try to, you know, set some context here. Yeah. So there's kind of a bunch of different things here. So Uniswap launched about eight years ago or seven years ago. And maybe about five years ago, we launched this thing called the UniToken, which was a token that was meant to govern the Uniswap ecosystem. And within that, well, at a high level, what the protocol does is it introduces an economic system for the Uniswap protocol and the UniToken.

3:30:20And then it also basically refocuses Uniswap Labs on building value and building on top of the Uniswap protocol. So, you know, we're kind of in this like moment in time where there's a bunch of different things happening in crypto. And part of what we're seeing is a lot of people almost like move crypto into traditional financial rails. And part of what, you know, they're sort of like almost trying to like IPO crypto companies or build these treasury companies. And what we're focusing on is doubling and tripling down on the technology itself and the decentralized protocol that we built. And so the proposal, first, it turns on protocol fees.

3:30:56This has been a really big thing in the Uniswap world for a very long time. People have kind of wondered when this would happen. But here, so the protocol fees will be turned on. And these are fees for trading on Uniswap protocol, as well as there's this chain that we built called Unichain. and those fees are also going to this uni burn system. There's also essentially a burn of a large amount of uni from the treasury and this is basically representing all the fees that could have been. It's almost like symbolic. There's been sort of a lot of speculation around when this would happen. And so I think that this is kind of like a nod to that.

3:31:36And then I think beyond that, Uniswap, so one thing to kind of give context here is that we were in this crazy regulation by enforcement area for crypto. Essentially, Gary Gensler and the SEC sued basically everyone who lived in the U.S. who was a crypto founder. And the kind of incentives that were created for the ecosystem, basically they said, if you do anything that builds value for a community, we're going to sue you. And then within that context, we were extremely limited in how we could interact with the world.

3:32:13And then they sued us anyway, and then it was ultimately dropped. But I think what's happening now is that there's a very different thing here. And so Uniswap Labs is really able to lean into the Uniswap protocol and building for it and focusing its full attention to that. Where we spent a lot of the past few years focused on basically building a business around the products that we build on top of the protocol. So there's this decentralized network, kind of like Bitcoin. And then there's these apps and websites, kind of like a Bitcoin wallet or an exchange built on top of Bitcoin. And so we've built these products on top of the Uniswap protocol.

3:32:47And they have tens of millions of users. And so we've been kind of very focused at Uniswap Labs on building a business around that. But with this proposal, I think what we're kind of acknowledging and what we're saying is that the really big opportunity here, much like the biggest opportunity of Bitcoin is the Bitcoin network, not each little application built on top. The big opportunity here is the Uniswap protocol. And we want, as the sort of inventors of this protocol and people who've been developing it for a long time, we want to make that our core focus. And so we're like leaning into that and kind of making that our full attention moving forward.

3:33:19What does this mean for equity holders in Uniswap Labs, the company that raised venture capital? Because I think part of what came out of the Gary Gensler era was you had this kind of like bifurcation of value where there was equity holders that got access to tokens. And so they had upside there. And it felt like not the kind of scenario that we'd see, let's say, in 15 years from now when tokenization is kind of the norm and this is a standard way to build companies and distribute value. But I'm curious what the proposal means for that kind of setup. Yeah. And it's a very perverse incentive to say, you know, if you do anything that creates value, that's the bad thing to do.

3:34:08versus, and that's sort of how you ended up with this kind of like thing where the only thing that was popular in crypto for a very long time was meme coins. And it was because they were, you know, they were the only thing that you could say, well, no one is trying to build any value. And so that's what became popular in crypto. And that's not really like what is exciting to me, right? What's exciting to me is the idea of these like truly decentralized networks that create value. And I think that for me, you know, what I want to align, you know, my work to doing is what I think creates the most value in the world.

3:34:35And I think for Uniswap Labs, the way that we think we can create the most value in the world is to lean into building this protocol. So part of this proposal does include a kind of a service provider relationship between us and the DAO that sort of aligns our kind of mutual, that sort of aligns our upside. And so in this proposal, if we create a lot of value, then we can kind of realize some of that. So the goal here is to really align incentives. And do you think more crypto companies that are raised from traditional financial institutions will try to pursue these more aligned models going forward?

3:35:14Look, I hope so. I think that everyone was sort of kind of dealing with what was possible. And I think that people have kind of still evolved and adapted.

3:35:25But my hope is that the crypto native things are what ultimately win. And I think that's kind of where I put my kind of bets. To me, you know, like the point of the technology is the – like the point of the industry is the technology. It's like the decentralization. It's the idea that you can create, you know, a financial application that you trust not because you trust a company, but because the code is transparent and public and auditable and run by multiple independent parties. This idea of like decentralized consensus and networks, it can be really powerful. And so I think that the more that, you know, projects lean into that, the better off we are.

3:36:02There's sort of like this interesting thing that happens. Like all of the, all of the fee, for example, the fee system that we're sort of proposing as part of this, every aspect of it is transparent and public and auditable and verifiable in real time. And so people don't need, you know, quarterly reports from a company when you can have, you know, real time access to anyone in the world that's like, not just like public and transparent, but also like cryptographically provable. And so, you know, there's sort of like different ways of accomplishing a lot of the goals that various regulations have when you sort of kind of like lean into the unique nature of the technology.

3:36:35That makes a lot of sense. How's the reaction been? We've been streaming here, so I haven't been able to check the timeline. But this seems like something that both, you know, Uniswap super fans and, you know, detractors would appreciate. Yeah, so it's only been about an hour and a half. You guys were fast to messaging me. But so far, I mean, from what I've seen, it has been extremely positive from a public reaction. Everyone on Twitter seems very happy, which is where most of crypto conversation happens. I guess it's X. I still say Twitter. It's hard. It's hard not to. It's hard. It still happens to me every now and then.

3:37:15Well, congratulations. Big, big milestone and feels like it's a really positive direction for the whole industry. We have one follow-up here. Do you think this is going to be a trend for other companies that are in a similar situation? Yeah, I hope so. We're doing it because we think it's what's best in the way – we think leaning into the decentralization and the decentralized protocol is what's best. And so I hope that other people follow this trend as well. I think that a lot of people have been doing it, but they've mostly been doing it from outside the U.S. or in all these different ways. And I think that ultimately we really believe that this is the right thing and what is best for users and what's best for the world, which is why we're doing it.

3:37:55What about on the regulation side? Is there anything to touch on there? Yeah, I would just be curious, are maybe the version of you that's earlier in their career, are they deciding to set up in the United States? I mean, I know you went through absolute hell for a number of years and being, you know, based in New York was a big challenge. But are you seeing more younger crypto builders decide, hey, it's actually makes sense for me to set up in a place like New York, one of the financial capitals of the world? Are you still seeing a lot of stuff happening offshore because people don't think it's worth the risk of potentially a new admin taking a different stance on crypto?

3:38:39Yeah, so I think, you know, for the past four years, it was a lot of people moving outside the U.S. And that was sort of the predominant advice that people got. And then what we've seen maybe over the past year is people start to come back to the U.S. And I have various friends who've kind of moved their offices and who run crypto companies who've kind of moved to New York. So we're definitely starting to see a financial hub and a crypto hub form in New York. Brooklyn? It's actually particularly in Soho, I'd say. But there's a Brooklyn hub, but there's kind of a growing Soho hub to crypto. And I personally, I love it here.

3:39:16I could say that it was because I believed in the technology and that being on the right side of history would ultimately prevail. But I will also say that I just love it here as well, and I love living in New York. So I definitely hope more people come here. In terms of the long-term certainty, that's really where this market structure bill that's being discussed in Congress is pretty important, as is what we expect would be upcoming regulations out of various regulators. And so the hope is to have additional clarity and clarity that makes sense with the technology. That's really important. I think what was challenging before is regulators taking stances that just didn't make sense for the technology.

3:39:58Um, uh, and, and so, uh, you know, the, the hope is that the, the sort of environment kind of can, like, and we really, you know, the hope is that long-term there isn't this sort of like, um, it's like not a, doesn't, you know, it doesn't kind of stay a politicized topic long-term. And the hope is that really it's just like people create sensible regulations that come out of Congress that sort of, um, and again, like recognize that, that, you know, the, the software developers that create decentralized protocols are very different from, you know, a centralized financial institution that custodies funds.

3:40:28Those are just fundamentally different things. And so the hope is to have that kind of really recognized and acknowledged at a federal scale. And once that happens, I think it will be even more of a slam dunk. Soho crypto renaissance era will really begin. Well, great to meet you. Thanks for coming on and congratulations on all the progress and the proposal. And we'll have to have you back on again soon. Yeah, excited to come back on sometime. Thanks so much. Great to hang. Cheers. Let me tell you about Wander. Find your happy place. Book a Wander with inspiring views, hotel-grade amenities, dreamy beds, top tier cleaning.

3:41:05And I am in a Wander right now. It's a vacation home, but better. It's Jordy's current home. So I will share one fun anecdote. They knew I had kids. I didn't communicate with the Wander team at all. Just booked it. And they knew I had kids because they asked for that info on the way in. They bought a bunch of toys. Oh, no way. There was toys when I arrived for the kids. And that made bedtime a challenge because it was like, it looked like Christmas morning out there. But without further ado, we have the CEO of Gamma coming in. Welcome to the show. Welcome to the show. So sorry to keep you waiting.

3:41:46Crazy day. Hey, guys. But we're pumped to have you on and talk about the news. Yeah, it's so great to be here, guys. excited to share we just closed the series B from Andreessen at a 2.1 billion dollar evaluation there's some other info too you're you're uh you're profitable too right is that right we we are profitable we've been profitable for two years two years and we uh we we passed 100 million in ARR all with a team of 50 50 team of 50 that's incredible insane uh what what makes gamma why is it working so well yeah because we've seen some you know this was a category that i think a lot of people were excited about a couple years ago we saw a ton of investment going into making uh making making uh you know decks specifically presentations with generative ai and not everything is panned out but it seems to be working uh incredibly well for you guys so what What's the secret sauce?

3:42:51I mean, we attribute a lot of it to actually getting started well before sort of this recent AI wave. We've been a company for five years now. So the first couple years, we actually focused a lot on just the underlying editing experience. So can we create new building blocks that aren't traditional slides, you know, the 16 by 9 format, and allow like the average person, the everyday person that isn't a designer, doesn't have design skills to create much faster. And so two and a half years ago, we kind of married those building blocks with just reengineering the entire workflow within Gamma so that AI can actually really quickly assemble those building blocks fast, give the end user a really seamless experience.

3:43:34What about on the, how can you talk about the shape of the user? Have you been selling direct to consumers, B2B? is there some sort of like, you know, Dropbox did like the viral web, the consumer software viral loop where I send it to you, you install, you become a customer, we upsell? Or is it more, you know, SDR led? How are you thinking about the actual growth engine for the business? Yeah, definitely. So where we started, we actually started much with much more of a prosumer base of users. So you can imagine anybody that has to do a lot of external facing, communication, whether a freelancer, solopreneur, small business owner, someone that needs to create a lot of decks, we made it dead simple for them to get started.

3:44:22For them, the beauty is that they're not locked into the Microsoft seat, the G Suite, so they have the freedom to choose whatever tool is best for the job. And so they're able to pick up our tool, use it. By nature of our category, we're lucky that if you like using gamma, you're sharing and presenting with others, There's organic virality baked into the use of the product. So as the product has gone better, more and more people use it, share it, share it in many different ways. And that allows us to essentially acquire more and more users for extremely cheap. How big is the market for Dex? Because I feel like it's hard for me to get a sense of how big the market is for actual infrastructure for creating Dex, software for creating Dex.

3:45:08Obviously, the market for DEX is in the hundreds of billions, I'm sure, if you add up all the different consulting groups and things like that. But yeah, how do you look at that market? You're multi-product now, but yeah, do you expect that DEX will be something, you know, kind of one of the biggest product line in five years, 10 years? Or do you guys really want to go wide? Well, yeah. So even if we just start with the category presentations, to your point, it's massive, right? So Google Slides, 800 million monthly active users, and then you add PowerPoint. We're talking well over a billion monthly active users.

3:45:47And that's just in that one category. And then you think about - PowerPoint has a billion monthly actives. That's insane. Well, you add Google Slides and PowerPoint together. So we're talking about a category where today, and that's with a product that's still pretty manual and tedious to use. Now imagine Gamma automating a ton. Our API is going to actually make it so that anybody can actually build on top of our platform as well. So if you have a business where content creation can be core to your infrastructure, you can now build on top of Gamma. And so no longer even manually creating content.

3:46:21It's going to be a massive market. And so that API business is that, you know, another SaaS company that wants to make it easy to generate reports that users can walk people through the organization? Oh, that's interesting. Like, is that kind of a use case? It's like, hey, take your data. We'll turn it into a beautiful presentation automatically that you can run a meeting with. So there's actually multiple different layers. You know, layer one I'll call kind of just an extension of our prosumer business today. So imagine if you're already using Zapier, you can combine that with your favorite tool.

3:46:52So Granola for notes, for instance. If you're a freelancer, you take all your notes in Granola, the moment the meeting's over, you can take that meeting transcript, feed it into Gamma, and create a very personalized deck going back to your client saying, hey, these are all the things we discussed. These are deliverables. These are the action items we agreed on. You get a beautiful PDF sent directly to them right after. So that's like a prosumer use case. Then there's like B2B use cases where, you know, in the future we'll partner with platforms like Glean where Glean is sitting on top of company knowledge.

3:47:26If anybody internally wants to create a QBR or strategy deck, they can pull that into Gamma, automate the content creation, create a beautiful deck so that you can use that for a meeting or discussion. And then one of the use cases you alluded to is what if other developers can build on top of Gamma. So imagine you have like a real estate app. Your real estate app, you want to empower your users anytime they look up a listing or look up a zip code. They want a PDF of all the different listings in that zip code. Well, we can power all that content creation, build a beautiful report so that app company focuses on the app itself, not on the content infrastructure.

3:48:02And we can essentially operate in the background, send that beautiful PDF with all the listings for that particular zip code to the end user for that particular app. are you going to keep the team lean going forward? Are you going to develop some hubris and hire like 400 people? What's the plan? DocuSign numbers. Get to DocuSign numbers. You know, we've always tried to do things maybe a little bit different. You know, we raise as little as we can. We build a super lean team. We continue, you know, I think we're going to continue to do that no matter what. And so lean is obviously, you know, relative to, you know, we have big ambitions.

3:48:38And so the team is going to get bigger. We're definitely hiring, but relative to our traction, I think we're still going to be pretty small. Did you ever think about raising$67 million? You know, it's a good question. We felt like we really needed that extra million just in case. You never know. Missed opportunity for the meme potential. Somebody else has to do that. Well, awesome. Crazy, crazy, crazy progress. and I love to see a winner coming out of this category. Everybody has been through the pain of making presentations and there were so many. I'm thinking of Tome, I think there was, and there was Pitch.com, all these companies that tried to crack this problem and just didn't quite figure it out.

3:49:26Ed Norton has a company. Oh, yeah, Ed, you're competing with Ed Norton too. We've got competition from everywhere, you know? Yeah, that's something to break into. Yeah, something's working. Well, great to meet you. Congratulations. And I'm sure we'll see you on here for, was this Series A or B? Series B. Series B. Okay, we'll see you on here for the C. Looking forward to it. Sounds great. Thanks so much, guys. Great to meet you. Fantastic. We'll see you soon. Let me tell you about Bezel. Your Bezel concierge is available now to source you any watch on the planet, seriously, any watch. Buko Capital Bloke said, I just don't see a world where corporate budgets for AI will be smaller in 2026 than they were in 2025.

3:50:09I think they will be much bigger. Got room to run, baby. Somebody commented, then you're out of touch with the world and stuck in a home office. Buko says that doesn't even make sense. That doesn't make sense, of course, because if you're in the home office, you wouldn't understand. No, I don't get that at all. That's very confusing. uh alex cohen says if a startup requires you to be in office 12 hours a day six days a week you should run the f away like your life depends on it apparently uh this company giga which has been going viral what is are they actually saying that you need to be in the office 12 days a week or sorry 12 hours a day someone someone said that they got hired in april to lead demand gen for them.

3:50:54They quit after the first day. There were red flags. When we hit 10 million ARR, we're going to spend 100K on blank illegal stuff. We're doing blank and MRR. The dashboards in the headquarters showed 6X less. In office, seven days a week, 12 hours a day. PTO policy is subject to change, blah, blah, blah, blah. You expect it to always be working. Gave an offer letter on Wednesday. So it's sort of like going back and forth. They chopped off a goat's head in India because it brings good luck. Sounds aggressive. I wonder, I wonder have they responded? Has Giga like responded to this and said like, this is not real.

3:51:28Cause that would be important, I guess, if they have to, because somebody is like making this claim about them, it should be sort of like, you know, uh, debated because, um, we don't know, you know, when someone, when someone makes a claim like this, there's a bunch of different motivations that could be behind it. I don't know. Uh, Hopefully, I saw Giga did an interview with Harsh Taggar from YC, and they seem to be getting some traction in their market, and there seems to be some good stuff. I mean, there's nothing wrong. Each one of these needs to be kind of evaluated in and of itself. There's nothing particularly wrong with working very hard if everyone's in on it and everyone's happy with it.

3:52:09So we'll see. We'll stay tuned for the response from the Giga. Yashan says, My AI investment thesis is that every AI application startup is likely to be crushed by rapid expansion of the foundational model providers. He's still bearish on the application layer. That's interesting. That was a take from like a year or two ago that had kind of got out of fashion. What do you think, Tyler? Well, yeah. So one thing, so Elon quoted it and says seems to be accurate. But one thing that's kind of interesting here, Sam Altman with Tyler Cowen, they were talking about like an AI native Slack. And a lot of people were saying like, request for startup.

3:52:47Like, who's building this? And it's like, you have to assume that Sam is going to, like, he runs his business on Slack. It's the new Google. He cares a lot about enterprise. He wants ChatGPT to be an agent that's working in your company 24-7. you think he's just going to be like, oh, yeah, someone else should build that. I don't care about the enterprise. Someone else should build the AI native Slack. Yeah, I don't know. I would just assume that he's building that. Yeah, yeah, yeah, yeah. We'll see. What do you think? Is there still value in the application layer, or are you so AGI-pilled that it doesn't matter?

3:53:23Just hoard electrons. I mean, yeah, this was like the original, like, rapper was like a slur almost. Yeah, totally. It's like, oh, you're starting a rapper company. It's a totally fake thing. But I think that the kind of wrapper trade has done very well. Oh, totally. It's done super well. Yeah, I mean, look at Giga. Not Giga, Gamma. They're profitable. 100 mil ARR. Profitable for two years. Yeah, I think people massively overestimate how many different things that these foundation model companies could actually do. You just can't allocate that many engineers to so many different products. I disagree.

3:54:01It's not that. it's the capabilities of the fundamental underlying model. Because there is a world where you go to just the base weights of GPT-10 and you say, generate me a 10 slide deck that pitches my product to this customer. And it just generates it all and it just does it all. And the tokens that it is outputting are essentially PPT-X files. generate UI on the fly that allows you to edit the output. Because even the smartest designers, best designers I've ever worked with, rarely are they just one-shotting a task where I'm like, no more. You want to get in there and switch it up yourself, right?

3:54:47Yeah, but so look at Cloud Code. Cloud Code is just a base model with some scaffolding. You can think of it as the actual capabilities of the model aren't incredible, but if you add basically, you know, essentially a really nice for loop, it gets way better. That's just like extra engineers that are just like normal software engineers. Sure. You could see that Anthropic do the same thing where they bring, you know, they put a group of 10 engineers and they say, make this better at building PowerPoints. Yes. They don't do that because. Yeah, yeah. No, I agree with that. But there was a scenario where Cloud Code would be the Cloud Code for PowerPoint.

3:55:26Because you can go to Cloud Code and tell it, hey, iterate on the for loop generating PowerPoint. Yeah, I think that's still not so crazy. I mean, you've talked about this thing where you use Cloud Code to do a research and it made a nice HTML file. That's a PDF. You could just PDF it at the end of it. It's a Word doc. Yeah. So there is a world where like, yeah, the application layer still faces significant competition from the foundation model labs. Let's read Ishan's. He's also the former CEO of Reddit, correct? Read it. I'll be right back. So, Yishan says, my AI investment thesis is that every AI application startup is likely to be crushed by rapid expansion of the foundational model providers.

3:56:12App functionality will be added to the foundational model's offerings because the big players aren't slow incumbents. It is wrong to apply the analogy of fast startup slow incumbent here. They are just big. for far more so than with any other prior new technology. There is a massive and fast-moving wave that obsoletes every new app as almost as fast as it can be invented. There's almost no time to build a company and scale it. There are two ways AI application startup founders can make money. Make a flash-in-the-pan app that generates a ton of cash and bank the cash. My estimate is that you have about 12 to 18 months cash flow generation.

3:56:51Make a good enough app that you get acquired by one of the big players for sufficient equity. The situation is highly unstable. We don't know if it's going to crash or go to the moon, but both scenarios make it very unlikely that any AI application startup will independently become a generational super company. Baseline odds are low to begin with. I sort of agree with that. That makes sense. The best odds are finding an application niche in a highly specialized field with extremely unique and specific data barriers, ideally ones relating to real atoms, hardware, or world-related. data and not software slash finance.

3:57:27Interesting. Yeah, I mean, I think, like, if you're a normal kind of consumer or wrapper company, you probably did not like seeing what OpenAI was doing this summer where they had, oh, we have an Expedia plugin, and now you can use, you know, Figma, you can use it straight in the chat. Sure, sure, sure. Yeah. I think there are still plenty of startups that are quietly dying from better models or productized features in the actual chat interface. or whatever. Yeah. Yeah. I do wonder about the shape of that curve because it's like, it's clear that like open AI used to just be such a monolith in the sense that it was just like train bigger transformer, train bigger transformer.

3:58:10That's what open AI is. At least that was like the, the view from the outside. And then it became like, okay, uh, chat GPT, the app, but then also like enterprise stuff. And then also API and then also Sora and also Dolly. And, and, and at one point, do you remember, do you remember the Dolly UI? Do you remember there was like, there was a moment where Dolly was turning into like Photoshop in the browser and you could actually like edit and highlight different regions. And you could do like in painting where you could say, generate an image here and then generate an image next to it, generate an image.

3:58:43You could kind of block it all together. And they were like building an application on top of the image model. And I don't know if that disappeared. Maybe we just don't talk about it anymore. Maybe they're still working on it, but there were a number of different, I imagine that they have a visualization of different SaaS categories that they could potentially go after, just like Google did with on-prem software. What's not in the cloud? Well, email's not in the cloud. Well, PowerPoint's not in the cloud. Well, Google Slides. Spreadsheets aren't in the cloud. Instead of Excel, let's go to Google Sheets.

3:59:18And Google just kind of chopped down that. And so OpenAI could be doing something very similar, looking at what's not AI-ified, what's not AI-native. Yeah, I think it's definitely wrong to say that this question of whether wrappers are long-term valuable, I think it's very much still an open question. Yeah, yeah, yeah. Yeah, it'll be interesting to see. There will definitely be some folks who get out early. There will be some folks who figure out ways to be durable. It'll probably be a mixed bag. Jagwire Analytics says the strategy Ponzi scheme is blowing up. They have$689 million of interest due in 2026 that they don't have.

3:59:59Saylor is enticing investors by raising yield by a 25 basis point to 10.5 % on preferred shares to raise capital to keep running the Ponzi while collateral deflates in value. So they currently have about$50 million of cash on hand In order to pay that interest, they can raise more debt at this relatively high rate, 10.5%. They currently have about$8.2 billion of debt. The market value of their Bitcoin is roughly$65 billion. And the company is sitting at a$68 billion market cap. It's down 40 % in the past six months. and so we will see so strategy is now trading at book value essentially is that right trading at 68 billion but they have 8 billion of debt ok ok so net of debt they're still a little bit high a little bit above where asset value is interesting apparently so this is in the Wall Street Journal too I guess everyone's writing about this right now but the stimmy check's coming back the tariff dividend a couple members of the team are excited about it excited for the stimulus checks everyone's pumped yeah I mean the original micro strategy trade was like it was hard to buy crypto on certain platforms it was hard to buy crypto in your IRA institutions and micro strategy gave folks a way to do that and it still exists.

4:01:41There is some sort of arbitrage still, but just purely getting access to Bitcoin is dual. Guess what day MicroStrategy peaked in the dot-com bubble? Wait, what? Oh, dot-com. Oh, they've been around that long. That's right. So the criticism of Saylor is that he was kind of a bub guy. Sure. He's big into that whole world. And the bold case is that he seems relentless. He's still around. The stock peaked March 10th of 2000. Wow. There you go. March 10th, 2000. So MicroStrategy was worth about$128 billion at its peak in July. It is now worth about$70 billion. So, I mean, a pretty significant sell-off.

4:02:27And interestingly, Bitcoin has not sold off in the same way. It's purely the market mood changing around crypto treasury companies, apparently. very very fascinating um there's yeah there's a lot here um but we can go into it some other time uh anything else in the timeline jordy that we should be looking we are well well over we're in the fourth hour baby we're well we're in the fifth hour we're in the fifth hour we're in the let's go for six let's go for six in the fourth hour i start asking our guests the same questions that Jordy asks. I just get so lost. It happens. There's like a million text messages.

4:03:09Anyway, stimulus checks are back. This is true apparently, or at least it's like rumored, or at least it's truth. It's not necessarily true yet, but it's on Truth Social. Warren Buffett has a letter that says he's going quiet. What? Warren Buffett says he's going quiet? He says in one of the, this is in the Times today. He says in one of his final missives as a company's leader, Mr. Buffett said he would accelerate his plans to disperse his fortune to his children's foundations. My children are now at their prime in respect to experience and wisdom, but have yet to enter old age. He's talking about his daughter and two sons who range in age from 67 to 72.

4:03:58And again. still sitting on a lot of cash. He's got a lot of cash. The Rockefeller Center Christmas tree has been delivered. Let's hear it for the Rockefeller. Christmas is officially here in New York City. We need some Christmas. I need some Christmas sound effects on the soundboard. We got to bring the Christmas spirit to the show. I need some bells. Oh, bells, jingle bells. Christmas has officially started at TVPN today. I'm calling it. We're Christmas maxing now. Very fun show. Thank you for watching. Tune in tomorrow. Wait, we have to read this last post from Andrew Reid. Last post. It says, The top real estate agent in Hillsborough, Burlington, is this guy named Stanley Lowe.

4:04:41And on his website, he says, What do you say? The diminutive risk taker speaks with competitiveness, cockiness, and conviction of a salesman who loves the business and rarely doubts his ability to succeed against all comers and all odds. While some will attempt to impugn the green banker operation as a high-end real estate machine, those who have transacted with the firm see it for what it is, a successful responsive juggernaut that reflects the personality and determination and discipline of one man, Stanley Lowe, and the perpetual motion of a real estate operation that never slackens in its quest to stay atop the real estate pyramid.

4:05:24What a bar. what a bar and look at this guy he's suited up looking like an absolute g he's actually the top we got to work on getting stanley on this show that's not him that's like a toy of him is it oh it uh i'm confused i think this is a real picture of him i think it may be a little bit of photoshop okay something weird's going on here it looks like a it looks like a like a toy or something and then and then our final final post okay uh we're not going to get to the story, I think. It's been late. Maybe we'll get to it tomorrow. But Sam says there's locking in and then there's locking in. How this 31-year-old made a quarter billion dollars in 30 months trading Russian oil when sanctions meant others stopped.

4:06:10Yeah, this is a great story. In the financial times, we'll dig into it. But stay tuned for more TVPN tomorrow, 11 a.m. Pacific. Can't wait. Can't wait. We'll see you then. Until then, leave us five stars on Apple Podcasts. and Spotify. And if you're looking for a shorter version of the show, although if you're in hour five, I doubt you are, but in general, if you're ever missing this show, we have a product called Diet TBPN. We edit down the whole show, bring it to you in 20, 30 minutes, something like that. All the flavor. All the flavor. And only 30 calories. Only 30 minutes of your time. And you can listen to it on 2X, I guess, if you want to.

4:06:50We will see you tomorrow. See you tomorrow. Goodbye. Cheers.