The LA Fires Continue, Rebuilding Market Map, PMF or DIE, Unpacking the "R" word, The End of Censorship

39:08I saw a Starlink battery, like new product, that's like built like basically like a week long battery that you can put your Starlink in. Okay, I need that. But it costs like five times as much as the Starlink. As the Starlink? Batteries are expensive, they still are. Apple needs to have some sort of like limited allocation like Ferrari does. So, you know, it's like, look, we're gonna need you to take a bath on this Apple Vision Pro. You're gonna need to get, because these things are losing you can buy an apple vision pro for 4k and go on ebay and sell it for 2k the next day like the depreciation is insane on the on this product but you do that a couple times your your you know your ad starts uh liking you gets you the allocation of the new diamond iced out apple watch when it goes yeah yeah yeah ice it out with with a you know 72 hour battery life it would be it would be really funny if they were just like yeah we launched the new iPhone has the has the best like m4 chip in it it's super it is interesting though and and you're you're gonna need to get on this to get it you can't just buy it it is fascinating that Apple has seemingly shifted away from this multi iPhone strategy and basically wanting everybody to get in theory get the next iPhone yeah when I do believe there's a huge number of people that if they made a$10 ,000 iPhone that had a just ridiculous battery life that they would get it.

40:31Totally. I would, if I had a phone that I just never had to really worry about charging, throw it on every now and then, the sort of my willingness to spend would be astronomical. It is crazy because there's that terrible camera bump on the top which was never on the Steve Jobs iPhones. The wobble is wild and it seems like if you just raise the rest of the phone to the thickness of the camera bump you would get double the battery life with the extra space. They must have run the numbers and been like, people don't care. I think that it's like a standard versus revealed preference thing. I think that for most people, it's like, yeah, just subscribe to the iPhone.

41:05I just think there's not. You want every year. It dies at the end of the day. You're good. And then, sure, you're a power user on X, so you're going to get screwed. But for most people, their phone lasts the full day, at least for a year, and then they move on to the next one. It would be, if they had any vision, they would do a landline version of the iPhone that has one of those stretchy cords that would actually we got to get that apps tim when you listen to this yeah reach out to us printer too we want that we got to get on we we got this incredible market map so john john is john future associate john did this and if anybody yeah if anybody uh any any venture capital firms out there that need a market map made john made this in like 10 minutes yeah i'm very uh very impressed but um yeah so we key question who's gonna make money obviously it's a terrible tragedy but yeah and who are the players ramifications so we tried to divide up what are the categories of industries that will be affected and then within those what are the subcategories and then give you a couple examples of each company yeah so the categories take us through some maybe list out all the categories yeah we'll go through one at a time category so So we have building materials and supplies, thousands and thousands of homes and structures and stores and all these things burned to the ground.

42:24Tons of damage that wasn't even necessarily structural. So that's a big one. Community and government support. So that's everything from FEMA to the Red Cross who are coming in. Some, you know, some activity on the nonprofit side, government side. Neither of those groups are going to be making money, but they're going to be spending a lot of money. and so people are going to be making money from those budgets. Construction and infrastructure. So there's big home builders and groups that will build a, you know, not a jam. Yeah, it's kind of unclear if those big home builders like Lennar will come in because they do more like track homes and specific developments.

43:04We can talk more about that when we go into the deep dive on that company. Yeah, and the Palisades is not an area where people are going to say, hey let's just take you could see that potentially happening where one block is like let's all work with this one builder and just build them out but anyway so construction and infrastructure environmental remediation restoration so that's everything on the cleanup side yep uh you know so much uh there's so much toxic waste uh all over la that needs to be cleaned up uh and then landscaping and erosion control so one thing that happens post fire is when all the fuel that fueled the fire burns off then um then then the mudslides become a huge risk do you remember those in santa barbara yeah really really sad so i was in college when those were happening and montecito had had some fires and then there was heavy rains and there was so much mud coming through the hills of Montecito that entire houses were just taken off like huge boulders so imagine a house a house traveling 200 feet the death toll was like 20 yeah yeah I know I had a family friend who not not super close or anything but who decided that they felt they were safe in their home even though there's a lot of rain and sort of activity and the home was just taken out just completely destroyed So very dark, but that's going to be super important now because all over LA and in the hills, people want to rebuild, but there's going to be like huge mud risks.

44:36So financial and insurance services. So there's going to be a lot of, a ton of lending, you know, activity for people that need construction loans to rebuild and, um, and huge fights. I was listening to something about this where like, where like there's like the, uh, what do they call it? a claims adjustment. Yeah. Big question about like, oh, like your house burned down and you're claiming that we need to like rebuild the foundation, but we think that the foundation was cracked before the fire happened. And so we're adjusting you down. And like, if you don't have perfect data on exactly all the materials, everything that went in, like you're just going to get pennies on the dollar, just huge fights.

45:15And then lawyers get involved. Well, yeah, so it's interesting. So there's going to be, the banks are going to make money on the new activity. Yep. but they're also going to lose money on mortgages where, you know, maybe somebody didn't have insurance. And so there's bankruptcy. Yeah. Um, and then there's just going to be obviously a bunch of policies shifting around as people realize, Oh, I need to get off the fair plan because, um, it was interesting. I, I think it was month. Was it Monday's episode? I reached out to kin.com just to, just as like a market research thing. And they called me like six times in the last few days.

45:52They finally picked up while we were at the grocery store earlier. Oh, yeah, that's who you were talking about. And they were like, yeah, we're issuing new policies in California. So kin.com is still issuing policies. QED, I think, is their biggest investor. So the next category, security and safety, you have alarm and monitoring services. And then there's a bunch of new upstart companies like Sauron that are in that space as well. And then physical security providers. So in the Palisades and Malibu area, there's like a specific security company called IPS that everybody uses. And so they've been on overdrive.

46:29They're probably really important in the short term. Yeah. And think about think about. So L.A.'s had huge issues forever with squatters. Sure. So if you I know people who have had a house in L.A. that was empty that would repeatedly get broken into. And the police just say we can't do anything about it. like there's weird laws around like if they just chill out in there for enough time then like suddenly like they're they have some rights which is crazy um so you want to hear a crazy story two weeks ago a friend of mine was flying back into lax gets off the plane goes to baggage claim luggage has been stolen there's an air tag in the luggage can see uh so she can see exactly where the luggage is going.

47:16It goes to this house. She takes a screenshot. It's stable. She knows exactly where it is. Calls 911 or calls the police department. Tells them, hey, my bag was stolen. It has an air tag. I know exactly where it is. Like, can you help me with this? And they were like, no. Just no. Just no? Just no. That's so dark. I know. That's collapse right there. And I was just like, I almost like, I want to like tweet about it, but it felt like very like cultural or something. So yeah, that's like, it feels like a sci-fi movie where you're like, okay, I'm hiring my own private social ops team to basically go break and enter.

47:50I was saying that. I was like, do you need me to go? Yeah, yeah. I'm ready to tool up. Steinman. I'd call Steinman. Call Steinman the door kicker. The door kicker. He's got like. Oh, he's ready. He's ready to go. No, but I had, I mean, I had. I was just shocked. I was like, you have all the evidence here. It's like so clear. All you need to do is just have. Committed in LA County. Just send someone to knock on the door and say, hey, give us that back. yeah and instead she just bought all these stuff oh really yeah never got it just wrote it off um next uh technology and data services so there's a ton of disaster assessment planning tech you know drones being used aerial photography um satellite imagery uh and then smart building and construct construction tech so you know there's going to be companies like pro core which is actually here in Santa Barbara County.

48:41They make a platform for construction management. So like they'll probably see a huge uptick in Southern California sales as builders sort of descend. And yeah, one thing that, you know, let's, let's get into it. Let's start breaking down each individual category. Sure. So why don't we start at the top? So manufacturers of core materials. So there's to make a house, takes a few different parts. So we have CEMEX is the first one. They're multinational, that we're highlighting, multinational producer of cement, concrete, and aggregates. They're a key supplier for roads, bridges, and foundations post-disaster.

49:19They are publicly traded, eight to$10 billion market cap, and operating in 50 plus countries already. So massive, massive country, or sorry, massive company already. And the other one that we have listed is owens corning they do roofing insulation fiberglass composites they're already been emphasizing like fire resistant and energy efficient products also publicly traded similar range nine to ten billion actually in annual revenue i wonder what some of these like uh construction materials companies if this will actually move the needle for the stock we were talking about maybe looking up some of the some of the market caps on this but because like although the la fire is like hugely impactful in this area like it is at the end of the day just like 10 000 homes and some of these These home builders are putting up 100 ,000 homes in a year.

50:04Well, yeah, but from a construction standpoint, if you think about the demand, so if there was$150 billion worth of damage, and everybody's projecting it to actually be higher than that, and you're the number one producer of cement and concrete, and then that$150 billion of damage is not going to cost$150 billion to replace, right? The replacement cost is actually lower because you build a house for$2 million, and then it's worth$4 million, right? Because the land didn't get destroyed or whatever. But I think that's calculated in the losses. I think when they say$150 billion losses. It's the replacement cost?

50:39Yeah, yeah. They're not talking about the land value for sure. No, no. I figured it's more. But the thing, a house that's built is worth more than the raw materials sitting around and the construction. Yeah. But I mean, I think that like, I mean, we discussed this in that Bloomberg Odd Lots interview where it's like there's the insurance claims and then there's the other disaster database. And so they're not just saying, oh, a$4 million house burned down. That's a$4 million loss. They're saying the insurance will pay out$2 million. Got it. So they're taking the lower. Exactly, exactly. Yeah. Because truthfully, the land was not destroyed.

51:18You still own the land. And even if you didn't have insurance and you had a$4 million home in the Palisades and it burned to the ground, your net worth, if you own that free and clear, is still$2 million probably, right? Something around that. Maybe it's 1 million, maybe it's 3. I don't know. But yeah, I mean, the losses are truly like the burned losses. It's interesting if you owned lots around LA that were in these fire affected areas and then now a bunch of red tape gets removed, your property value actually ticked up in some ways because now it's easier to build and you can build it faster so you're not carrying that construction.

51:55I was actually thinking about this. like uh there's that there's a funny newsome announcement where he was like we're removing the red tape for all the fire victims and dude did you see the video you see nat friedman quote tweeted him he was like but we're leaving the red tape for everyone else yeah it's like why i just see the video of him everybody was saying he was on a bunch of stimulants because he has these like weird tics where he was going hand motions yeah so we he literally was going like this yeah we're really afraid of these property developers. We're really afraid of these property developers that are going to come in and make lowball offers on these properties.

52:31You know, I talked to the Maui guy, you know, the Maui governor, and he was afraid of the same thing. So we're working on, he's just such a slimeball. But I wonder, I wonder like, there's going to be like payouts to people that are affected. I wonder where that. $770 from Joe. Yeah, it's like seven, it was like 700 bucks or something 770 dollars oh yeah seven seven i thought you just said 70 dollars that would be really i mean what's the difference yeah just lost but um but but there's also the question about like if the regulations change like will it be all of malibu like will it be easier for you to build will it be like altadena burned i'm in pasadena my water was affected because i'm on the same water line which is why i'm here in santa barbara now um but my house didn't burn down but there was ash that fell on my house like we have ashes the thing is the question is like all this stuff is like do i benefit from this or not i'm still malibu coastal commission yep low you have local groups other environmental groups there's so many different levels of permits yep i i think it's great that gavin is him can go out and say we're make it easier than ever to build yeah but it will but but okay you've removed red tape but then you have a thousand times more people trying to do the thing so what is the net effect are they going to get you know a hundred times more you know employees that are processing sort of these like permitting stuff like that everything's going to still be permitted you talked about how you talked about how you were just trying to rebuild a room in your house and they were like well if you want to do that you have to put in a stove you have to add a kitchen you have to add a kitchen you're like i already have a kitchen i already have a kitchen i you just really want me to cook i get all my food from kava i guess i'm barnyard it really is so insane it's like yeah your house needs two kitchens yeah why no all this is exposing that that every single level is broken right and we talked about this on monday's episode the they had just introduced new regulations to solve the insurance crisis that was already unfolding and then it there was a weak delay between when it went into effect and when the fires hit so no change and it's so easy to just be like the branding is we're removing red tape and then the law is like we're going to make it sure that your house can never be built unless it's to the most environmental fire code possible and it's like now and so now la now la has i i think we're going to want to cover this but the the the business of super bowl prep the business of olympic prep so we're we have these huge international events coming to la by 2028 and um that just adds a whole other level to it but let's keep going so we have separately um these tend to be the company so semex and or chemex I don't actually know how you say it, and Owens-Corning, get way less attention because they're much more on the industry side, B2B, than Lowe's and Home Depot, which still have a huge B2B component to their business, but are the more high-profile sort of consumer retail businesses.

55:40So Lowe's, I think everybody should know, second largest hardware building supply retailer in the U.S. provides community support and emergency supplies post-disaster, which is great. uh they do 90 to 100 billion in revenue they're based in north carolina where they just had obviously a big hurricane and then you have home depot which is the largest u.s home improvement retailer critical supplier of rebuilding materials after disasters 2300 stores they have 150 billion of annual revenue and so um so yeah the average you know for every one person that walks into a home depot one of them is a you know contractor two people that walk in one is it's 50 50 at home Home Depot contractors versus DIY prosumers.

56:20At Lowe's, it's about 70 % DIYers. Really? Yeah, it's more of Lowe's is where you go as a consumer. The contractors lean towards Home Depot. And there's some interesting design choices that they've actually made in the history of Home Depot where they were building one of the first stores, I believe, and the builder on the actual store had like polished the floors and made it look all nice and they came in there and they were like, this is not gonna be friendly to a contractor. Like a contractor wants to see like grit and so like throw some sawdust down on the ground. That is funny because whenever I'm in Home Depot, you know, I feel like a lost golden retriever.

57:04Exactly. I'm over here golden retriever math. Yeah, yeah, yeah. Yeah, and the idea is to, you know, put the contractor first, you show up, you go in, you just get your stuff and you go. Whereas Lowe's, there's going to be more people walking around kind of, oh, oh, you want to, you know, like, you know, DIY your own deck or just get some furniture or get a new fridge. Like we'll, we'll walk you through that. You could, in many ways, I would imagine that Home Depot is a bigger beneficiary here because there's been so much instruction. You're not doing the foundation yourself. Exactly. Yeah. That is almost a meme online of like, you know, you can just build a house.

57:40People that can, you know, left wing people will complain about the cost of housing. And then these sort of like homesteader right wing people will be like, you can just build, you can just go and buy the supplies and build your house. So I'm sure we'll see some of that. Home Depot went through some crazy shocks during COVID. Everyone was worried that like, you know, the housing market would collapse because the stock market was down. The economy was really rough during the early days of COVID. Unemployment was really high. But then once people realized that they were going to be at home for a year, they were like, let's do some home improvement projects.

58:12And I think they pulled forward something like five years of growth in one year during COVID. And the stock like mooned and did really well because everyone was doing renovations and stuff because they're like, if I'm going to be here and the interest rates are really low and I'm getting massive checks from the government and I'm not moving and the stock and the price of my house is going way up. I should be renovating. and they were just like stuff everywhere. So yeah, Home Depot. A lot of flipping too. A lot of flipping during that time. So again, Home Depot is a national company. We're covering Brad Jacobs on Friday, but he has a new private equity firm.

58:48Yeah, private equity roll up firm. You're gonna try and buy a couple companies that do construction supplies. So they're presumably would - B2B. More like CEMEX or Chemex. Exactly. And Owens, but the smaller mid-market companies. He wants to bring in technology and automation to all the stuff he's done at XPO and the other logistics companies that he's run, but focused on construction supply chain. Yeah. All right. Let's jump into, we're going to cover more of that. Kind of like McMaster Carr, if you're familiar with that. He wants to be McMaster Carr level for construction supplies. Who is posting about the McMaster Margarita?

59:28Oh, yeah. The ITAR Gatorade. The ITAR Gatorade. It's great. So next category, community and government support subcategory. We have emergency management and coordination. So first up, we have Cal OES. They oversee the emergency response specifically for the state of California. They coordinate the wildfire evacuations and statewide resource deployment. It's interesting because I don't know anybody that was using Cal OES for this. Everybody was using WatchDuty, but I'm sure Cal OES data feeds into that somehow. Sure, sure. Yeah, that makes sense. but watch duty is a non-profit but it's but it's like a company so it's like startup almost and i'm it wasn't it wasn't perfect non-profit now might be for-profit conversion if they want to start printing yeah yeah yeah take private get those units stack those units if you're in watch duty guffon and company take private at watch studio watch duty just jacks it up to 100 yeah get the keyed in there yeah yeah get some dark patterns dark patterns dark and uh start start printing dark um in-app purchase yeah and so cal oh yes coordinates with local like city la and fema for disaster strategies and yeah it was wild i think wednesday night watch duty just stopped updating the fire didn't spread all night so i remember everybody's watching it being like what's going on because that's like the only way to get anything close to information um fema is a more interesting one to me here.

1:00:58So FEMA's, everybody knows, kind of a controversial agency because they deal with a lot of the immigration stuff, but federal agency coordinating major disaster response across the U.S. They provide grants, temporary housing and public infrastructure repair funding. So they're funding, you know, if a freeway gets damaged, they're going to help fund that. They oversee$20 billion annually in disaster relief. So what's interesting about this This is people, yeah, and I'm sure that that's more of like an average, and I'm sure it massively ticks out. Yeah, like around Katrina, I'm sure it was higher.

1:01:33But what's interesting about this is there's a whole subcategory of contractors that are already looped in, you know, that do work with FEMA because there's always stuff happening, right? So think of it as like a FEMA SMB type, you know, operator where FEMA is now going to be funding a lot of the cleanup from the fire where everything from, okay, there's, we have these 20 cars on the street that burned out and we need to bring a bulldozer. And so there's probably DOD contracting, but just, yeah. So there's a subcategory of, of contractors right now that are buying, that are buying or renting every available bulldozer in the surrounding area or shipping them in just to operate them to basically take on these like individual, you know, FEMA contracts and could probably do a whole deep dive there, but it's a lot of like people that have good intentions.

1:02:29A lot of people that are just trying to make a quick buck. A lot of that money gets spent pretty poorly because there's like this crisis situation. And if you need to clean up, you know, hundreds of square miles or thousands and thousands of acres of just like chaos, then like you just need to spend money. It's like a startup, right? Where if you need to do something super, super fast, sometimes the best way to do it is just to like overspend. The local agencies and nonprofits, American Red Cross, Habitat for Humanity, everybody knows the Red Cross. Not many injuries or blood donations going on right now because the death toll is so low, but I'm sure they come out with like, you know, just general relief.

1:03:08Yeah. So the Red Cross works at local agencies. They're trying to, you know, provide support for displaced residents. They operate on two to three billion dollars annually from donations and grants. So, you know, big organization, but maybe not even as big as some might think. Habitat for Humanity, they build and repair affordable homes with volunteer labor and they offer zero interest mortgages for disaster affected families. So that's cool. They're active globally, but they're based in Atlanta. I built a house with Habitat for Humanity in high school and it was like the slowest process in the world.

1:03:46It took like months for them to do like anything oh yeah because it's like now we're gonna do the because it's like american uh like there's all the regulations and stuff yeah it just takes forever uh and then i had and then i did one where i went to mexico and did it built the house in a day it was the most satisfying thing in the world that's crazy i mean they poured the foundation before but you get there and and it's just like okay frame this out put this up it's like very minimal but you finish the house in a single day that's so sick that's how it should be hopefully i mean that's not going to happen here but hopefully even 100 days right yeah um i have a friend bring in the omich yeah just throw up barns um import the i have a buddy in malibu who did an internal remodel structure didn't change at all took him over three years.

1:04:34And it was the kind of thing that could have been done in four months. yeah but just massive delays so all right next construction and infrastructure commercial and infrastructure construction so there's aecom aecom acom global engineering construction firm for handling civil and commercial projects it's more for like if the water plant or power plant like burned down like they're going to come in and build like a bespoke like you know massive power plant or some like piece of huge infrastructure like the water main stuff like that Yeah, you have to imagine a lot of that stuff didn't burn to the ground because it's like concrete buildings, but the machinery inside.

1:05:15And right now we have a water crisis in LA just because, you know, the water's not getting properly built. When you think about, like, who builds the reservoir, like that type of thing. Like, do we need an extra reservoir after this? Is that the resolution? Well, then you're going to call in one of these massive engineering firms. Their comp should be structured based on making sure the reservoir actually has water. You know, like it should be like a, you know, we need some accountability. You don't get paid unless it's full. And then there's Bechtel, one of the largest privately held engineering companies, renowned for massive infrastructure projects worldwide, 17 to 20 billion in annual revenue, international operations.

1:05:50Very similar companies. Halliburton, famous for Dick Cheney. Halliburton, very old company, but does these huge infrastructure projects. The famous story is in Iraq, like you need to put in oil well, they would engineer that and build that. and then are you familiar with Parsons in Pasadena? Oh the design school right? There is a design school I think the design school was endowed by the founder of the engineering firm. Oh crazy. I think his name is Bill Parsons and he designed like all these weapons he was like a DOD contractor during like maybe World War II maybe a little bit after but built like a whole bunch of like tanks and stuff and then eventually did more and more engineering projects bigger and now it's like this big big engineering firm crazy um okay on the residential side we have kb home and lennar kb home customizable energy efficient homes in major u.s markets built to order model simplifies adaptation to local codes based in la so i'm sure they're gonna you know i actually talked to a guy who does a bunch of can i have the other three pages by the way yeah um did we get the printer you're working sorry i haven't said copies of this um we can trade back at some point um i talked to a guy in santa barbara the other day i was like are you gonna go try to do any development work in in santa barbara and he or sorry in la and he's like i'm good you know i don't want to go basically get involved in someone's backyard so i think a lot of this stuff will go to local builders yep um and that's who i'd want you know if i my house burned down i'd want somebody local that's not just like coming in for a few years to like make a quick buck and get out.

1:07:33Yeah. And then Lenar, one of the largest U.S. home builders, they focus on scalability and they do have post-disaster rebuilding sort of products based in Miami,$35 billion market cap. Also an investor in Cover. Really? Yeah. That's cool. Yeah. So Cover is a friend's company who builds modular homes. homes and you have to imagine that covers revenue will 10x you would imagine if people are doing stuff uh their core market has been adus and backyard homes a very quick no but here's here's here's one angle and this is what people have done even historically is if you need to remodel or rebuild your primary home throw an adu in the backyard start with the adu live there and then you can build the full house there's people that don't you know if your house didn't burn down but it was badly damaged and then okay so you're not you're going to get paid to get it remodeled yep but insurance payouts kind of work where they're like well we'll fund it for two years but then it takes three four years to rebuild and then you have to then carry the cost of two properties just for your primary residence yeah i mean i certainly hope that they can step up and and help they they they have this whole modular like you know they they basically manufacture panels.

1:08:51There's a lot of manufactured homes where they build the whole home in a huge warehouse and they put it on the back of a truck. You've probably seen these driving down like the five. It's crazy. And then sometimes they split the home in half and then they just piece it together, bolt it to the foundation. And those homes feel really bad when you're in them. Yeah, yeah. And they're built using traditional manufacturing techniques. Like it's a guy with hammer and nails, like nailing like two by fours together to make the home and then putting up drywall. the cover model is like make these modular panels that then can click together and they're perfectly engineered so that even like the you know the the power outlets are like built into the whole system yeah um but they long term they want to have all those panels click together so you could make a three-story house out of them uh but they just aren't quite there yet and there's always a question of when these uh when these big events happen like the ukraine war like there's a lot of uh there's a lot of drone companies where it's like yeah they'd want to jump into that business but they don't have a manufacturing plant.

1:09:50They have like a demo product and they're just not really going to move the needle. But it can be a catalyst for a next funding round or a next product or something like that. There's this interesting deep dive on D.R. Horton from Business Breakdowns. They're very similar to Lenar in the sense that they're a massive home builder. I think they build 100 ,000, yeah, 90 ,000 homes annually now. The founder started with$3 ,000 in 1978 and a$30 ,000 loan from the bank built one home. and then five homes, and then 10 homes, and then 100 homes. That's so crazy. In 1992, he built 1 ,200 homes, and now he's building 90 ,000 annually.

1:10:28Yeah, so one thing to note,

1:10:36if you're somebody who is obsessed with construction and home building, which there are many people, and you want to go and build a major construction company, or home building company, there's nothing wrong with coming to LA and setting up shop and trying to rebuild a bunch of homes here. And that can be your, the catalyst to building a big business. It's not, you're not taking advantage of anyone. You're providing a service. Nobody's going to give you money unless you're providing them value in exchange. So I would imagine that there will be some, there will be many people that make an incredible, you know, catalyze their career and go from a$2 million revenue business to a 20 plus.

1:11:18Yeah. One of the interesting things about these large home builders that came out of this deep dive that I listened to was a lot of them have transitioned to being asset light, meaning that they don't typically own the land and they're less in the real estate business. And they've said the business has transformed from being a real estate business to being a manufacturing business. So they really just focus on making the homes. 75 % of the land is optioned versus 25 % a decade ago. and that has increased the return on equity for this business from 10 % to 22%. It's a much more asset light. And it's really just about getting those homes out as fast as possible.

1:11:53Now, I don't think any of those prefab manufactured homes are going into the Palisades. There's a question about Altadena. The average home price there was probably a third to a fifth as much as the Palisades. Like 800K to a million? Something like that, yeah. But there's a big question about what will that community want in terms of style and design? I think there's a pending gentrification crisis almost in Altadena where so many of the people there had owned their homes for so long that if you own your home free and clear, you do not have to have insurance, I don't believe. You can just raw dog it, basically.

1:12:44But what's going to happen is Altadena is in close proximity to LA. People will look at that very opportunistically and say, we can create$3 million homes here, you know, and$3 million gated communities by going out. Or more mixed use you could mix in. So Pasadena has been going through a little bit of a transition where in the downtown core, there's been more apartment buildings going up. still not 10 stories. You're talking about like four story buildings and Altadena historically really had none of those. So maybe you put in some of those. There's these zero lot line homes that are very popular in LA right now, especially in kind of the Echo Park area.

1:13:26It's a full house. You own the house, but there's no lot. Like your house bumps up against your neighbor's house. And it's basically just like this ultimate optimized, like check the box for what a house is. There's no place to be golden retriever maxing. Yeah, it's rough. There's no place to sun your... Well, the roof deck usually. So they're designed to be like hyper optimized. I know a guy who moved into one and he has a golf simulator. Perennium sunning on the... You better hope you're the highest rooftop. So it'll be like a two-car garage, but they're like stacked. And then you go upstairs and there's like a kitchen, open floor plan, living room.

1:14:01Then you go upstairs, there's some bedrooms. Then there's a roof deck. And it kind of like checks the boxes for like you have one of everything. and they look nice, but they're just like really, really condensed to be able to fit them all in. So you can wind up building like a 3 ,000 square foot four bedroom home on like a 6 ,000 square foot plot of land or something instead of like a quarter acre or whatever. I probably have those numbers wrong, but it's a small plot of land because it's just stacked up. And so I could see some of those going in. I could see some of the, I wonder how many people will say, hey, we want El Tadino to look like it did before, so let's build in kind of, there's this Spanish style, there was a lot of like tiled roofs and stuff.

1:14:43And there was just a lot, I mean, it was a very slow growth community. Like it grew for 100 years without a real reset. And it was historically, there was a large community of like African-American. Yeah, and Latinos. Yeah. And so there's a question about like, yeah, what will the style demands of that community be going forward? how much displacement will there be from wealthier people moving there? It's going to be, I mean, it's an interesting experiment to see what the Palisades look like. Yeah. Just because. I can see the Palisades rebuilding exactly like it looked. Yeah, similar. I mean, they were still in the Palisades.

1:15:24There were still homes from the 60s. Sure. Yeah, a lot of stuff like that. Yeah. But let's keep it rolling because there's a lot here. So environmental remediation and restoration. Uh, cleanup and remediation is a big one. We, we covered some of this in the emergency management section, but you have Belfor global property restoration firm for fire, water, and storm damage. They offer complete services. They do cleanup and reconstruction. Also privately held clean harbors specializes in hazardous waste management and industrial services. They remove toxic debris and manage environment, environmental risk post disaster publicly traded for four to five billion annual revenue the one interesting thing here is like okay you have a gas station that just burned to the ground it was on fire okay now is that what happened to the tanks like is it is it leaking oil everywhere a lot of the gas would have been siphoned out um just by nature of the the demand in the exit to the fire um but but yeah there's there's just so many levels to the crisis that's not just the homes right there's um it's like simple stuff like oh this hardware store had 200 batteries in this back room that just burned right so now that's all just leaking all the refrigerators all the stoves yeah just melted um uh landscaping and and erosion control so bartlett tree experts is one they have 150 offices so that goes to show you can uh get uh you can build a big company pretty much in any niche family owned still they do like basically just any work around these sort of i mean for as many homes as la has it has as many trees the trees weirdly a lot of them are left standing which is just a proof point for i think going forward a lot of these homes are going to add these complex sprinkler systems there's this guy who runs an smb and like does a lot of stuff with the homes in malibu called i think it's like brush fire battle systems like kind of a cool name but he creates these um i actually meant to when i was originally looking into that idea around doing a drone fire response business i i was meant to talk to him but then we had a bunch of fires and the meeting never happened um but but he builds these sprinkler systems to just make homes damp when fires are breaking out and the trees it was interesting a lot of conspiracy theorists were saying like how did all the homes burn down and not the trees and this car but but trees are very moist they have filled with filled with water they're like humans they're like what yeah 70 water whereas the so it's much harder how's it like the driest wood possible yeah if you've ever tried to burn down a you know burn you know start a fire with like wet wood it just doesn't work that's why you have to kill the tree and then you burn it out and it's an interesting thing where where homes in california and you know buildings everywhere have fire sprinklers because it's a way to protect yeah but it's like why don't we have systems that just completely irrigate every home as these fires are starting because if not the firefighters are going to have to come put them out so that to me seems like a startup opportunity that's maybe not a venture back business but just create these sprinkler systems for homes that are set up where when somebody evacuates they turn it on and it just like sprays water everywhere makes the place damp so davy tree employee-owned company very cool better than uh much better than being a non-profit for tree care and environmental consulting stabilizes landscapes post-fire by removing hazardous trees one and a half to two billion of annual revenue they're based in ohio wow um so So like there's a lot of trees.

1:19:10I have no idea if those companies have presences in LA, but it gives you a shape. No, but they should be being like, okay, we have 200 employees. We're sending them to LA because even around my neighborhood, just from the wind alone, walking around my neighborhood, there's all these trees that have fallen down. And so anyways, they'll be making some money out of this. Banks and mortgage lenders, you know, I don't think we have to explain Bank of America or Wells Fargo to our highly sophisticated audience of uh wealthy technologists but um uh so maybe we skip over that property and casualty insurance all state state farm um yeah we already talked we already talked about insurance i say we like skip over this i mean all state uh but i'm sure there were policies there they're saying they're they they're all states focused on like rapid claims um and uh but you can imagine so much of the stuff is just going to be slogged and you know it's like any any time you experience a business experiences 100x like comms around something it's going to be slow alarm and monitor in a lot of areas right now people still can't get to their homes like they're just literally blocked by national guard and even if you own a home you can't get through security and safety alarm and monitoring services it's kind of interesting because like some of these businesses just lost a bunch of customers because people are not going to like pay to secure pay adt in the long run to secure a lot yep um and they're not going to pay for uh whatever what's the like camera ring or whatever like nobody's paying for ring if their cameras don't exist anymore that'll be a quick unsubscribe um and then the physical security providers i think will be bigger because people have very little trust in the government right now and even though there's a national guard presence um the one thing that that is positive on the security side in la is nathan hockman who was the is a new da for la who um just started and he was caruso's pick i saw caruso talk and endorse hockman at a fundraiser in the palisades um back in q4 um he's already like throwing the book at looters and people criminals that are you know uh have been taking advantage of the situation uh support services and ancillary industries you have architecture and engineering a lot of these design firms engineering firms that are just figuring out how do we rebuild this home there was the home in succession the 125 million dollar home in the palisades that burned to the ground that rebuilding 125 million dollar home on a slope is like a very complex engineering undertaking so that by itself is probably like Just imagine the architecture and engineering bill for rebuilding a home like that has to be in the millions of dollars.

1:22:04So there's going to be some big beneficiaries there. Professional services, Deloitte, McKinsey, these companies that are doing consulting, audits, tax, all this advisory work. Anytime you have massive amounts of money changing hands, these companies benefit. McKinsey always finds a way to make money in a crisis. yeah we got to get the we got to get the mckenzie sponsorship and then get like pre-seed companies working with mckenzie and they're like look like you've got 100k of annualized revenue like you're paying you're paying yourself 100k a year like their only person to cut is you like mckenzie's gonna be like cut yourself like but sir like who will run the company and they're like well we have our ai agent practice for a million dollars we can create a program for you to run your business with ai agents and they're like well spend the money on us don't spend it on yourself everybody will win in the long run it's great um disaster assessment and planning techs so we talked about this a little bit before but the drone deploy they they use um they deploy drones and they have software for aerial mapping and inspection i i was recommending to somebody the other day they were like i couldn't get to their house and i was like go find buy satellite imagery because you can buy it now you can actually pay planet labs to task a satellite i'm sure a bunch of satellites were tasked over la this last week um i think that's the other that's the other company that's mentioned yeah so drone deploy has raised 140 million you can hit the size gong for that uh they do quick damage assessments over uh large fire areas so like they'll they'll i'm sure make you know this is the kind of thing where insurance companies are now like probably like sitting around the table being like oh my god you know and you know publicly they're like we're very you know devastated but then internally you can imagine they're just like freaking out and so i'm sure they're tasking drone deploy with with various projects and then um smart building and construction tech uh this is just more like sass um autodesk uh creators of AutoCAD and a bunch of other design engineering tools.

1:24:22What's interesting is like, you know that when, whenever something like crazy national news story happens, like there are startups that are pivoting and looking for their next idea and some of them might pivot into something related to fire prevention. I think the fear, and I've seen this play out before, I knew a guy who after the San Francisco fires remember the ones that turned the sky orange yeah he he decided to start a fire wildlife prevention what wildfire he decided to start a fire fire prevention company right and it was using all this data and peeling all and pulling all the stuff together but selling into the government was so hard that he pivoted and I was telling him like like okay you have all these like vanity metrics and like contracts that you're working on but like really like the catalyst for your company being huge will be like what happened with the WatchFire app.

1:25:18Like when you save - WatchDuty. When you save your first home, like that should be your main KPI that you have on the wall of your company. It's just like homes saved. That guy BrushFire Battle Systems literally - Saved a home. Saved a home. And so he's like, here's the proof. Exactly. So now he's gonna get millions of dollars. You just need to write a zero on the wall. Zero homes saved. You need to just work backwards from saving a home. And as soon as you save a home, there will be a national news story about your company like you're really smart you'll sign all of those inflection points yeah exactly exactly another but he pivoted out before the next fire and so there was never a moment when it was like the tech could demonstrate like what it was i think there's probably a flock safety style business that makes consumer apps for cities and state and local governments to manage disasters because right now like when the disaster broke out everybody's on whatsapp i message you know coordinating using watch duty but watch duty wasn't working and i don't really want to be reliant on a non-profit during you know a fight like fire realistically because it's like okay they went down for 12 hours yeah and was that because like they hit they their cloud bill they didn't have like the basically like who knows right well we probably will never know but um i think there's a consumer business to be like cities states get every one of your citizens like on this app so we're not in line on the press release i think of flux safety is like the hardware company like anduril for yeah sure more like citizen citizen app is i guess this but it's not around local governments yeah something like that makes more sense yeah yeah more around communications because the government being like i was getting my information from group chats my hoa yeah and then the city was the HOA was getting going and like tuning into the live events broadcast that the city was doing there's always this question about like yeah oh like can the technology save us in this situation and and I always worry that it's not it's not a matter of technology it's a matter of like willpower or like do you desire like is there even a desire to solve some of these problems like it's very unclear yeah and you kind of need to rely on people like my neighbors were great I got them.

1:27:29It's tricky. Well, should we move on to the timeline? We need to jump into the timeline. That's great. I got it. Take a break. Welcome back to Technology Brothers, still the most profitable podcast in the world. Jordy, you have an exciting announcement to make. Let's hear about PMF or Die, the latest project from the Technology Brothers. Okay, so yesterday I sent out a - Inspiration struck. I wasn't exactly yesterday morning, but the inspiration for some of this, for some of the language that I use in the post definitely struck in the morning. So a while back, John and I, we're always thinking of new formats and concepts and stuff like that.

1:28:10Our goal is to entertain and elevate technology brother voices and movements. And so we were thinking about, well, what if we found a founder, gave him 25K and just basically locked them in a studio apartment for 90 days and then used the word you used studio apartment studio apartment did you refer to it as a cage a cage well it's now called the cage okay break down the tweet and read your post no i'm just giving some of the history of it so the idea was like well if we have a founder we'll talk about them on the show we'll support them we'll get them a bunch of attention and if they can't hit a million dollars of arr in that 90 days with all of the attention of us telling people go buy this product today then they're never going to succeed and they and and we do some type of deal where they literally have to quit startups if they can't make it work um you got to go work uh in big tech if you can't make it in the in the cage uh but i i posted yesterday so we're working on a new show called pmf or die we will lock a small founding team in a studio aka the cage with 25k in funding and only enough food caffeine and nicotine to last for 90 days the team will only be released if when they achieve a million in arr and the whole process will be documented and shared daily while in the cage you will get millions of eyeballs and be coached by some of the most accomplished founders in the world so if you can't find pmf in the cage you just won't find it anywhere please reach out if you're interested in being locked up and i will and i will share the application and that and it's so so funny 2 000 likes right yeah it's 2 300 2300 2300 likes still climbing lots of uh yeah and i had to quickly follow it up and say like no this is not a joke here's the application um so uh yeah and i'll say it again now like i want as many of our listeners to be a part of this as possible you'll all be in the ride uh as viewers and um described it as mr beast meets paul graham yeah i said if mr beast and paul graham were to make sweet love and have a nice and give birth to a baby accelerator it would look a lot like pmf or die and it's so funny because i've maybe watched five minutes of mr beast content i just never got into it i didn't watch Squid Games.

1:30:21I've never, I just was never big into that whole world. I've never watched Survivor or anything, any of these other shows. Um, but this is in that vein. I think it's going to be extremely entertaining and it's one of the issues. So, um, we've talked a lot about different concepts and shows and one of the issues with Shark Tank is because they're putting this out on TV, which is not a tech startup audience generally. Uh, they need to only basically, they only can work with founders that are um that are creating sort of gimmicky cpg products like i made i made this cooler that also has a grill built into it so you can like cool your steaks and then have lock yeah the greatest shark yeah and so there's a bunch of it's a wristband that shocks you when you do something that you're trying to quit so if you're trying to quit smoking it will shock you when you smoke it's the pavlovian response it's like total yeah yeah and so there's It's a bunch of meme tech.

1:31:17And I think it's great. And if you're building a product that, you know, and founders go on that because they don't go on that to get the money because the terms aren't generally good. They go on to get the attention and these reruns and stuff like that. So it's really a customer acquisition. Do you know the whole gimmick on Shark Tank? Let's go. Yeah, yeah. Go for it. Go for it. Oh, this is such a good story. So they film you for like an hour. The actual segment on TV will be like 15 minutes max. And so what happens is they wind up, am I good? Okay. What happens is that there's, during that, there's a bunch of really good quotes from you, and there's also a bunch of really bad quotes of things you stumble into stuff.

1:31:56Yeah, they beat you into stuff. Yeah, and they ask you hard questions, then they ask you easy questions. And then depending on if you take the deal, they will edit it to make you look great. And if you don't take the deal, they will make you look bad. And so I had a friend who went on and just tied them up in legal negotiation for so long that they had to run it. And they were like, we're doing the deal. Make us look good. We're doing the deal. Make us look good. And then as soon as it went live, it was like, I'm not doing that deal. No way. It's the worst deal I've ever seen. Exactly, exactly.

1:32:28Yeah, it's locked. Yeah, yeah. But I mean, that just gives you an idea of like the problem with Shark Tank. It's purely entertainment. So it's cut out a lot of founders that don't care to get in front of that audience, that don't want that funding. And so one thing that's really interesting, we've seen this recently, is so many companies can get to that one million of ARR mark faster than ever. You're seeing it in YC. The best YC companies are getting out with like millions of ARR. And you're seeing teenagers on X go from nothing to doing hundreds of thousands a month. And part of that is like these new, this new like these LLMs that are enabling new experiences.

1:33:06But part of it's just faster to build. It's just faster to program. And so we want to create basically the cage, which is like the best place to build a software company. And so specifically for this kind of corner of the internet, one of my favorite responses was Shkreli responded and said, hits too close to home and shared that and got a good response. We got to get him as one of the coaches. Yeah, so I actually messaged him to become a coach already. And I think it's funny because if he was actually a player, he would get out in a day. Oh, yeah. guarantee you he would figure out a way to get out in a day and so there's so many fun ways that you can gamify this the point is not to create the next you know i i hope that people create world-changing startups out of it but it's totally cool to come in the cage and just have yeah it's a sprint and have fun right i i was telling i think something that people could do is make the next like i am rich app call it the jailbreak app and be like i am stuck in a in a prison right now i can only get out if i get a million of arr subscribe to my app i will donate all the profits to fire relief, right?

1:34:08There you go. And somebody would get out in a day, right? If they know how to work TikTok. And so the players will have access to the TV audience and the X audience. I posted a follow-up to just make sure that people understand that this is real. I'm very happy to see the incredible response to PMF or Die. We are clearly making something people want. The show is guaranteed to be life-changing for the players. They will either leave the cage with a million-dollar ARR business as a niche internet micro-celebrity, or they will die. Either way, it's a big change. We have received 10 X more applications than we anticipated.

1:34:41And we will be processing them as fast as we can. The demand has been insane. Like there's so many talented, uh, builders reaching out. It's a kind of the perfect opportunity if you're just like in the middle of something or you want to start something new, you want to quit. Um, what information did you put on the form? Just email, name, just name, email, you gotta put mailing address. Cause like, it's always good to be able to send people stuff. Yeah, that'd be good. So yeah, we're just trying to process the applications at this point. We already have people that we've accepted. We're going to be sharing a lot more information, location, dates.

1:35:14And there's tons of opportunities for people to get involved. You can be a player. You can be a coach. You can be an antagonist. You can be a trainer, right? We're going to have weightlifting equipment there. We're going to have treadmills. You're not going to be getting sloppy in the cage. and so if you want to sponsor the show there's going to be a bunch of opportunities we're going to have to get a bunch of these in there and it's just going to be super fun the response was really incredible i saw that dm you got from someone who said uh put me in the cage i yearned for the cage for the cage so there's something primal about being in the cage and just wanting to break out it's a cure and um it's great we're going to figure out how to structure the 25k it'll be an investment yeah maybe it'll be like uh you know debt lots of debt covenants the debt covenants are the are the real like you know maybe it's more like venture debt yeah exactly um but no we don't want to scare anyone off like the point is not to to really own a lot of these businesses the point is to just like create some really great entertainment and create some some great companies out of it so um so go apply what's yeah so you can just go to x and go to pbc PMF at PMF or die or PMF, uh, that the application link is in the bio.

1:36:30It's apply.pmfordie.com slash S1. Um, and, uh, it's going to be a lot of fun. As I like to say, if you can't find PMF in the cage, you won't find it anywhere. War is peace. Freedom is slavery. PMF is strength. There you go. Fantastic. I'm excited. Um, we will talk a lot more about the show coming up. You'll be, um you'll be you'll be hearing about it relentlessly and uh some of the locations we're looking at are pretty insane uh we're looking all over the country for the right spot um and uh you know we're gonna be you know assuming season one goes well we'll be going more and more exotic we're gonna do epstein island season two season two we take back yeah yeah green we could have we'd have reed hoffman come uh come back to the island Back to the Island.

1:37:25Um, but, uh, but yeah, it's going to be, it's going to be a lot of fun and, uh, everybody will be able to be involved. We're going to have, I'm sure there'll be some like betting markets on poly market. Um, that's, that's a cool one. Um, and, uh, I just, it's going to be a really great time. So, um, without further ado, let's talk protein. Oh yeah. Protein. Okay. So You have mentioned this founder many times on the show. Founder of RxBar. Does he go by Pete or Peter? Peter Rahal. Founded RxBar. Did not raise a lot of venture capital. I don't know if he raised any. He sold the business for hundreds of millions of dollars.

1:38:09Became very wealthy. And then decided to run it all back and build another protein bar company. And I have been surviving off of these exclusively for the last 30 days. and it's been fantastic. You've been doing like roughly 10 a day? 10 a day. So it has 28 grams of protein, 150 calories. So 10 a day, I get one and a half grams of protein per pound of body weight roughly and only 1 ,500 calories. 1 ,500 calories. So I'm in a major caloric deficit. Lean, but a mass muscle. And just, yeah, going down to 5 % body fat getting absolutely peeled while maintaining all the muscle mass. question for the audience should john try to get his ifb pro yes because that's like obvious there's gonna hit a point this year where the the natural next step is to get your card yeah and do a show yeah because some of the greatest ever do it chesky yeah you know had his run yeah on the amateur bodybuilding circuit yeah but uh these are fantastic i've i've been really enjoying these uh just in really, really insane macros.

1:39:17The rule of thumb. And Ryan, our dear friend Ryan Harmon at Dayjob did all the branding. Oh, we did the branding. Fantastic. It is great. The David Barr after Michelangelo's David, correct? I saw the angel in the marble and carved until I set him free. That is how you need to be thinking about yourself. Does it say that on here? On the side. That's sick. Oh, that's amazing. These quotes, biblical quotes. Yeah, it's fantastic. the macros really feel too good to be true the rule of thumb that a buddy of mine gave me was if you're trying to eat healthy and get a lot of protein you should be looking for one gram of protein for every 10 calories so you pull out a protein bar that's 200 calories it should have 20 grams of protein this has almost twice the ratio it's uncanny it ratios the other bars it ratios the other bars and I thought it was going to taste absolutely terrible because of the, I thought it was a Faustian bargain.

1:40:14But I think they taste great and I could easily survive off these for years and just walk around IFBB Pro status ready to step on stage at 6 % body fat at any moment. Let's go. Yeah. It really is fantastic. I'm a huge fan of these. We might have different palates, but I'm into this. And so thank you for sending these. that just tastes like almost like a rice krispie it really it doesn't taste like you think you'd be really really dry right and like inedible and it's just like it just gets so much better than rx bar yeah which is evidence of why repeat founders oftentimes do really well yep because they're a better founder than they were with their last company but then with uh with this he didn't just he's it's he's still in the bar game so he's like making a 10x better bar no i i would eat rx bars quite a lot i just like the fact that it was so simple yeah and it's funny because this is on the other end of the spectrum of simple but but much more of of a science project in a way right where it's not a um so anyways shout out to david shout out to peter uh thank you for getting us stocked up.

1:41:30They're fantastic. This will take us nicely into the, um, into the timeline. Definitely present in the cage. You'll be surviving off of those. Yeah. The cage, by the way, uh, one thing I want to clarify, it's not meant to be, um, the cage is not meant to be, uh, a unenjoyable experience. I, I predict that many people have been talking to some of the applicants. I predict that many people will get to the end of the 90 days and and actually have like sort of a mexican standoff you know uh like i don't want to leave the cage like i'm like i'm like you know like i'm staying they're calling the sponsors we have season two right now the chef is too good the steaks are too good i'm too diced i'm my company's ripping if i have to move it's going to disrupt my company everything off like let me stay um I hope they can just speed run everything.

1:42:27I want to see an acquisition of one company into another. Yeah, we're going to see large scale M &A, mango seed rounds getting done in the cage. What is private equity guys doing in the cage today? Oh, they're doing a LBO in one of the companies. Yeah, I would like to see a roll up. Roll up of some of the cage companies. I'd like to see somebody come in. The good strategy is come in with a search fund. Okay. Acquire a business over that 90 days. Get to the 1 million mark. Seller financing. You only have 25K. The meme coin idea is good too, right? Yeah, meme coin's obvious. But I mean, the seller finance buyout of a business that's already doing a million ARR, that's very doable.

1:43:04That's the beauty of this. There's no rule. You can get out in a day. The only rule, the rules are very simple. Creativity. 25K, 90 days, 1 million. Or you die. Or you die. So Nate Eliason, you know him? He said that the death should be waterboarding with Dom Perry.

1:43:25I was like, I don't know. I don't think that's the way to go, but that's rough. I mean, if you were going to go. There'll be lots of Dom Perignon regardless. If you had to be tortured to death slowly, you'd choose Dom Perignon. I mean, I've been doing dry January, so only drinking dry champagnes basically every day. And it's been fantastic. I mean, your body just changes after a couple weeks of not drinking sweet wines and focusing on the dry ones during dry January. So highly recommend doing dry January, sticking to Dom. I have a fantastic story about Cages and Paul Graham. First time I heard him speak, Silicon Valley, 2012.

1:44:05First company went, or second company. Crazy that I wasn't even born yet. Yeah. Yeah, you were in what, third grade? First company's going through YC, and PG comes to talk and gives this talk about like what red flags exist for founders of companies they see. And so PG famously really loves technical teams. He likes, you know, oh, these three guys were at MIT together. They all can program roughly and they all come out. And then over time, you know, the CEO does a lot less programming. Eventually the CTO becomes just a manager, but is very technical still. And this is a common pattern we see where it's like, if it's a tech company, like the CEO is still pretty technical, even if they're not coding.

1:44:49With Party Round, that was a huge... Oh, yeah. People were... We didn't get into YC because of that. You were now a technical founder. Well, I can't say it was just because of that, but that was a primary reason they gave. We were already funded by Google's early stage fund. But I do feel like it was the biggest detriment to our success because in terms of imagine it's a Friday night, and you are a CEO, and you want to have the most impact on your business, and maybe shipping that next feature is the best way to have an impact. If you're non-technical, you're just sitting there. And you just simply can't have the impact.

1:45:36And if you are technical, you can evaluate technical talent very well, you can rally the troops, inspire them, and you just know, hey, this bug that somebody, a customer came to me, I'm the CEO, told me to fix this bug. If you're at least a little bit technical, you can clock, okay, this is a week-long project. I'm not going to try and give this to somebody on Friday night. I'm going to actually set ourselves up for success next week and build this feature properly. Or this should take 15 minutes. If I give it to my team and they take a week, there's a problem. Like something weird's going on.

1:46:06And so PG's been super bullish on technical teams, technical founders for a long time. But he comes in and he says one pattern that he sees is the business guy, the MBA guy that comes in and is like, I got this business idea and I have my technical code monkey who's gonna build it for me. And the term that he used for the programmers who, because he's like, usually it's like some shy programmer who's been lightly bullied into joining this startup for this business guy who has no idea how to build this technology is Cager. Oh, wow. because he's like, the way it feels in a YC pitch is that they pull out their code monkey in the cage and they're like, then this is the guy who's gonna build it.

1:46:52Look at my quant, that type of thing. And so we would always joke about like, oh, you're a cager, we need a cager, that type of stuff. And so the cage is well established in the YC canon. It's so real. I mean, every one of those business guys that hasn't built a software company before, software is pretty tangible because everybody's used a bunch of software and they've used, oh, I've used Salesforce. I can build a CRM. Oh, I've used Airbnb. I can build a sharing economy app. And then you just realize that it's building great software. It's maybe getting easier to build great software, but it is not easy at all.

1:47:28It's definitely art. And the toughest thing and the reason that I think I was not accepted to YC and even raised, you know, didn't stop me from raising, you know, YC has their religion almost, right? Like it's very firmly like they have their criteria and that's what they need to follow in order to accept hundreds of companies a year. But I feel like their general framework, I've used it for my own angel investing and it's been the best like it's it is the best framework for me for evaluating early stage technology companies. because it's just so much data has gone into that um that uh i now you know well if i talk to a founder that doesn't even look too dissimilar to myself um that that i'm like no i won't invest in your company unless you have somebody who is is equal to you that is as good as you at what you do at engineering and they're as bought into the mission and they're also like a brother to you or like you work together.

1:48:30Yeah, yeah, because that's the other thing. Because the real risk is having a CTO that you don't know that well is usually a disaster too because you can't trust them in the same way that you can somebody you've worked any amount of time with. So that's why. So you ask those questions and then if it's a no, you ask them, well, what's your bench press? And then that's kind of the final hurdle. Yeah, yeah, that's the final hurdle. As long as they're repping two plates or benching more than, yeah, 1 ,000 pound club. It could be 800 pound squat. Or just bench, the Brian Johnson club, just benching more than Brian Johnson.

1:48:56That'll look pretty far in life. Yeah, yeah, which most people can do. Anyway, get in the cage, folks. Sign up today. Let's go to Brian Graham. He says, Zuck says Meta is putting in cubicles. It's bringing back scotch at lunch and smoking in the office. Zuck says the company's Amex cards work at the strip clubs again. He says it's back to suit and tie dress code. Zuck says they're reinstalling the asbestos. Zuck says there's no Irish allowed. And then Santiago tags us and says, this is a Tech Bros Pod worthy banger right here. 38K likes. like people really like this but it is funny this this is why this is why this is why we're doing pmf or die because 38k likes just shows how mainstream yeah stuff has become into this yeah i um yeah i mean it's kind of funny zuck kind of is at this point where he's basically kind of understands that he's he always wants to be at the edge of doing what people like and what is acceptable right so he's just kind of like crawling to the edge coming up to a new spot being like okay i can go a little farther i can go a little farther let's take the tampons out of the mail restrooms let's see what happens then yeah yeah i haven't gotten canceled apparently palmer palmer said he posted he said he had some story about the it probably was like some crazy company that was charging like twenty dollars a tampon like abusing it being like well you need to buy this tampons as a service i mean that is hilarious that it's like if you're trying to sell more urinals logically you'd be like they need to be in both bathrooms no that was the issue that was the issue i remember the plate the library that i would study at in college i had my little zone yeah and i remember when the dei wave hit and they ripped out all the urinals and and made the our main bathroom for that section so the the walk to go to the bath you know when you're studying and you're just like grinding for like 10 hours and you're and you just sort of like at your desk walking you know my my peer group would walk outside smoke cigarette walk you know back to the desk go to the bathroom and just like alternate there and then it just became like a super long walk to get to a urinal um so it was devastating but i'm sure they're putting it back uh now which is also good for the urinal companies right yeah for sure i i love the the suit and tie dress code obviously we we love a suit we don't wear ties yet but stay tuned sucks bringing back martinis in the cafeteria.

1:51:18He said scotch and smoking in the office, which I support as well. If you combine big tech profits with power lunch and bring back the power lunch, people, all you can drink. I told you about my buddy who his dad worked at Goldman Sachs on their prop desk and their whole team wore tuxedos every day. Every day? Every day. That was like the dress code in their office. And I was like, dude, that's so sick. Like the eighties were probably so tight. He was like, oh no, this was in 2007. Right before the crash. And I was like, 2007, like people were wearing tuxedos all the time. And like, I have a feeling that like the MD on that team just thought it was funny.

1:52:02And it was just like, okay, this is like what our culture will be in this pod. Because like when you're in Goldman, like it's a huge organization, you need to differentiate your team a little bit. And I was like, that's an amazing thing. So if you're, If you're a manager at Meta, make your team wear a suit and tie every day. Just lean into that one. Because that's not offensive. The smoking in the office, that's gonna set off the fire alarms. There's a lot of other things here that are a little bit more risky. Don't recommend the asbestos, but you can't go wrong with a nice suit and tie. Let's go to the next one.

1:52:37Forward Thinking Founders says, Monday's pod is going to be lit. In this conversation, Matt Sherman interviews Simp4Satoshi of Truffle. Topics covered include the discussion of Truffle, a device for local inference tied to humanoid robotics and personal intelligence, insights from a unique upbringing in the Middle East, future of AI agents, criticism of Sam Altman, critique of Y Combinator. Simp4Satoshi has been spicy on the timeline for a while. And Forward Thinking Founders says, can you print this one out, please? This episode is going to be epic. So I guess it's Forward Thinking Founders. Did he tag us?

1:53:10Yeah, he tagged us. is forward thinking founders a podcast i guess it must it must be this must be an interview all right so we we are running this is officially now a promoted post for matt sherman's podcast with sim for satoshi yeah so anyways uh so go listen sim for satoshi's got a lot going on right now he i saw him posting that he's potentially launching a token for the truffle uh and there's there's a thesis around that's not that crazy because there's a render token are you familiar with this yeah yeah you can render 3d like and he's he's trying to figure out the right way to do it super long, lock up, stuff like that.

1:53:43I think, well, let's see how, I would imagine that Sam Altman would open just like a colossal short position against it. So dangerous game once you're in the public crypto markets, but we'll see how it plays out. Let's go to Will Manitis, obscure hobbyist of the year last year. He says, everyone in tech 100x underestimates how important an official capital formation is for building the future. Inventing the safe and making it so you could sell equity with a one-page agreement probably created greater than$100 billion in equity value. There's dozens of these unlocks left to discover. I agree with that.

1:54:24There's a very interesting story where when LLMs first popped off and all the AI companies were like the hottest thing and it was like, this is the future technology and everything else is just like zero sum reshuffling, like B2B SaaS, cringe, all that stuff. It was like, go build the real stuff, build the Tesla, the rockets, the AI. That was like the real tech. Then everything else was just like, you know, busy work basically. And what was interesting was like, I was thinking about it. I was like, is this a legitimate critique? And if you look at how did the LLMs actually get built, efficient capital formation is a huge part of that story.

1:55:02And it's the same thing for rockets. like without the financing structures that go into the rockets. Without the SPV into the SPV and the SPV into the SPV with this 10 % management fee and all this stuff. I mean, it's a joke, but like even just the credit lines on all the different materials in the supply chain that go into a rocket, that is actually important. And that financial innovation does speed up the rate at which we get to Mars, which is crazy to think about. And it's absolutely true for AI where, you know, you have this like nonprofit that's able to do a whole bunch of, you know, fundamental research.

1:55:32and then get super creative with the capital formation later stage with all these NVIDIA credits that are going into AI startups right now. So, oh, you need to train or fine tune a model. We will figure out how to do that. And a lot of those deals are very, like, they face a lot of criticism because during the dot-com boom, a lot of telecom companies did these crazy deals with dot-com web startups where they would basically invest in the company with in-kind credits for the fiber optic cables that they were laying out, and it led to a lot of dark fiber, but that type of creative capital formation is actually extremely important, and the safe is obviously the best possible example because it sped up how quickly startups could move, and it shortened financing timelines from a month of due diligence to a few days.

1:56:27yeah what's your take on this what are you looking up well i'll tell you in a second but uh yeah i mean the people don't really realize because because my generation at least never built companies in a world without the safe so the safe was just the default method to raise capital yeah and people don't realize that if you wanted to take even a 25 000 investment however many years ago it really was like a lot of silicon valley was high trust so it'd be like i'm just going to give you money and we'll figure it out but then and here's like literally a napkin kind of thing like you know here's the general terms well it'll take a while to get done but we've been really blessed to only know that sort of frictionless capital raising and I even with party round was taking it a step further with safe automation where you could come on the app kyc and then generate a round generate you know send it and it was like using cash app it was the same amount of time to sign up with party round to raise as it was to like sign up for cash app do you remember the convertible note era at all i never i never even so the convertible notes maybe i invested in i've invested probably one or two yeah i mean it's pretty it was pretty like a crazy dance because you do this round and there's a cap on the convertible note but there's no floor yeah typically there's a famous example of a company that did one and it was disaster for the for the investors but um but typically it's like you know you raise two million dollars on a convertible note or if it's a big round you do like 10 million dollars on a convertible note and that all sounds great but if you wind up raising money at 10 million dollars they own 100 of your business or 50 of your business or something and it's kind of like this default recap now in practice it doesn't happen that much because if you're a startup and things are going bad like usually you're acquiring a company or just shutting down uh there aren't that many places where like your crown jewel gets like stolen by some convertible note investor um but it was a little bit more nerve wracking than the, uh, than the safe.

1:58:22And certainly the safe is much, much faster. Uh, should we do a bucket poll? I gotta, I gotta do a promoted post. So, uh, we were meant to get on the phone with Wander, uh, the team at Wander. Uh, no, we're, we're, we're late. So we, we had a two 30 call schedule. Should they just call into the podcast right now? Yeah. Yeah. No, I think we're gonna, I'm going to try to talk with them. We'll try to set it up for like 30 minutes from now. But, um, yeah, so we, uh, when, when I posted about some issues I was having with Airbnb over the weekend, Kyle Tibbetts over at Wander reached out and was like, Hey, let us get you set up.

1:58:56So anyways, Wander, if you don't know, Wander is a technology provider and they own some real estate, but they've shifted to, I think, a more asset light model where they go and get the best homes in the world, period. Homes that would have maybe been on Airbnb, but then they operate them almost like a hotel. So, you know, the sheets are going to be good. You know, the wifi is going to be fast. You know, the soaps are going to be nice. There's like snacks when you arrive. And so it's, and you know, that you're not going to, you know, book a place and then 10 minutes before they're like, Oh, I can't host you and cancel the Amon Geary of couch surfing.

1:59:32It's the Amon Geary of vacation rentals. So, um, so yeah, I I've known John for a while, uh, and, and his dad, they're both, they're both fantastic. And the company's great. They have hundreds of properties now. Cool. And yeah, just really, really cool business. So we are definitely going to be staying in Wander's this year. I think it's a great solution if you're a startup founder that is wanting to book like a retreat for your team and post up somewhere nice for four days and just get a bunch of work done. Much better, I think, solution than just relying on some Airbnb and you show up and i've had this happen before where you show up you get your team on the wi-fi and everybody's like uh it doesn't work like it's devastating right the starlings destroys productivity good for startup retreats if somebody wanted to like do a diy cage situation would that make sense um john john says a tech bros pod shout out will make my month that's the ceo of wander well john we did something better we ran an ad go to uh every technology brother uh listener go to wander.com tell them the technology brother sent you email the CEO we're now talking with them in 30 minutes so we got to get the pod tight let's wrap up if you wind up buying a product from somebody we advertise just throw a little post on X a little at the CEO tell them the technology brother sent you don't even worry about coupon codes I'm sure we'll do them at some point what you want to be doing is sending a DM to the CEO or tagging them in a public X post saying that the Technology Brothers sent you.

2:01:14Yeah. This is the real way to get attribution. All right. So we're going to be talking to them tomorrow now. Let's get into the next bucket. Let's do a bucket poll from Eric. He says, when a software engineer says that's not necessarily true, it means someone just said something incredibly stupid. Yeah, that's rough. The software engineers, they're polite, but brutal. They can be cold. Well, I mean, it's a very strict discipline, right? A very strict discipline. The facts are the facts. Everything compiles. And if your logic doesn't compile, you probably just said something very stupid. Not too much to say about that.

2:01:54But I'm sure plenty of software engineers have told you that's not necessarily true since non-technical and all. Yeah, yeah. Should we move on to daily drivers? How, in the world of Devon AI, is everyone technical? If I sick an army of Devon AI agents on somebody and say, you know. I think, I mean, the gradient to becoming technical. I would say I'm technically technical. The gradient. It used to be that if you understood Excel, learning Visual Basic, which does a little bit of, it's programming language, and it can automate Excel and it works in the background. It runs scripts, which is very, very helpful.

2:02:37If you ever open up like a really big investment banking model, there'll be a whole bunch of visual basic behind the scenes that buttons you can actually click that do stuff. You can build, I built a whole CRM in Excel at one point using VBA. And then from there, you know, you could teach yourself like Python in like a weekend or you could do like a coding bootcamp. So like the definition of like what is technical is like a huge gradient from like, Like, okay, I know like - I was DDoSing my father's website. Yeah, so it's like, that is pretty technical. It's not super technical. It's just like, it's enough to understand how software works a little bit.

2:03:11You learn a programming language, you write some scripts. But that gradient is just getting so much smoother. Like just last night, I needed to pull together some data and I went in chat GPT, asked it to write a script and then chat GPT just throw up like, here's the script, press this button to just run it. So it didn't even need to like install Python on this laptop and like set up an environment. And then you get a cursor and that's more advanced and then you get Devon and that's even more advanced and it's just running continuously in your repo. And so the gradient, so I think the big question is like if you're intimidated by the idea of software engineering or code in general, like you should probably spend a weekend just having ChatGPT explain stuff to you and learn how to write like the most basic Python program.

2:03:54Because once you actually solve a problem, even if it's just like, I want to scrape some website and pull it into a spreadsheet. Like I did that with the, like we wanted to see like every economist article that's ever been written about technologists. Like that's just a really easy scraping problem. It's a code that's pretty easy to write. You can just have an AI help you, but you get to a point where you're like, okay, I achieved the goal. I have used code to do my bidding. Therefore I can understand that. This is the advice I always give. AI is not gonna take your job. a technical person using AI while in a cold plunge is going to take you in a cage in a cage let's move on to daily drivers yep uh good day uh Sarah says uh good daily driver for defense tech founders and it's a beautiful Mercedes G wagon six by six they need to make more of those they do they should just they should just kill the regular 550 g63 and just switch over all production to these because the road presence is just on another level.

2:04:57I mean, they just launched the G580 with EQ technology. Have you seen that one? It's the electric G-Wagon that can do a tank turn. You don't like it? I think those are going to depreciate incredibly fast. And I think it will only make the gas powered more valuable. That said, is Sarah a partner at 0.72 yet? Because if not, she should be i don't know anyone else at point 72 but you know i was going uh the is he like in base is he in the baseball world yeah okay baseball guy um but yeah i think uh if i was building a defense tech company right now uh i'd be pitching you know sarah well this is a controversial post because a lot of defense tech founders are quote tweeting this and saying wrong it's the toyota hilux yeah or the ford raptor we gotta be we should get into the hilux importation business so we should go into some of these areas and make cash offers bring them in on show and display yeah yeah imagine uh yeah i like uh yeah i think uh the high luck six by six toyota what's the meme where toyota's like we don't know how all these high luxes ended up in the desert in the middle east like we don't even know where the money you know the money came in in, you know, I mean, you know, there are some, there are a lot of G wagons that get lifted and people do a four by four squared conversion with portal axles.

2:06:23So they are higher up. And I think there's been a six by six conversion that someone did, which is insane. The amount of engineering that went into that is like crazy. But yeah, the Toyota, the Toyota Hilux six by six beats both of these, I think. Yeah. Pull up in that. You're good. Any other, any other recommendations for daily drivers for defense tech founders? What would you go for? I would just go for, I would go for a, go get an old, uh, uh, NASCAR. That's a good one. Uh, it's quite a bit cheaper than the average Tesla right now. You can go pick one up for 30, 40 grand and, um, make it, you know, convert it, get it street legal and, uh, drive that slap all of your, uh, venture investors logos on the car.

2:07:08Cause they're your sponsors. You've given up too much alpha. It's going to be my car. Uh, yeah. Slap the, uh, slap your, your, cap table on because those are your sponsors and just hit the roads. Yeah, I mean we're trying to move on from the fires but there's still so many posts we got to cover one of them. This is real technology brother behavior. Tryndamere, Mark Merrill, the founder of Riot Games says, been off the grid fighting to save my house and neighborhood for days. It burned a house two doors down, two above us on a hill and two on the other side of us, went all around. We are staying vigilant because we are not out of the woods with embers falling ash and putting out spot fires around and at our neighbors.

2:07:47Got a Starlink up and solar powered rechargeable battery, which has been a game changer to coordinate and get info. My brother lost his house. Our kids lost their school and 90 % of the families at their school lost their houses. Wow. And the Palisades. Grateful to all the first responders and everyone working to help support each other and save lives and neighborhoods. Reminder to everyone, be prepared for emergencies. Our water, food supplies, hoses, and landscape fire hygiene has been critical for us. Sending love to everyone affected. And he posted this photo of him just like covered in soot, like just dealing with it.

2:08:21And there's like a cyber trick in the background. Fascinating. I mean, yeah, real heroic behavior there. It does seem that a significant number of people that stayed behind and fought and basically ignored the evacuation warnings were successful in saving their homes. But, you know, obviously, you know, some even, I'm sure, larger amount weren't successful. So it's a miracle. Glad his house made it. And I'm sure it'll be like a, end up being a community outpost almost for his neighbors that are as, you know, his neighborhood burned to the ground. And I'm sure he'll open it up to people as they rebuild.

2:09:03So bravo. Here's another good one from Word Grammar. Been on the show before. Word Grammar says, in Mario Kart, the racers in place eight through 12 get really good items. First place gets banana peels and blue shells thrown at them. This is how I expect LLM research to work. As time goes on, it will get easier and easier to train new frontier models. A third of this is that more research papers get published as time goes on. A third of this is that more open source models get released as time goes on. a third of this is that nvidia chips get faster better and easier to program as time goes on super interesting great analogy yeah i mean we're seeing everybody's everybody's playing yeah deep deep sink i mean deep seek deep seek uh deep sink it into the ocean i'm gonna put this lllm tie some weights to it throw it in the sf bay let it sink let the shark's feet on it yeah um yeah yeah i just don't i i think but yeah i think everybody letting everybody letting everybody giving them this like crazy victory lap model from two years ago got open source okay yeah yeah it's not crazy research don't give them don't give them uh don't even give them any chats let's do a let's do a promoted post uh i got a promoted post from jacob rintamaki Jacob and Tamaki.

2:10:28He says, I'm looking for work, please reach out. And then he's got this awesome post that I'll cover a little bit. And I would say this is this is very smart. Instead of throwing up the open to work thing on his LinkedIn, he's actually saying what he wants to work on and what's what's interesting about his point of view. He says, according to my iPhone, I walked for approximately 12.6 miles yesterday, mostly because I didn't want to pay for non-Zerb Ubers in the Bay Area. However, all that walking made me do a lot of thinking. So I'm ready to announce that I'm looking for work. This piece includes the first two things I would do if hired at each of the three organizations I'm particularly, but not exclusively interested in Doge, Renaissance, philanthropy, and Future House.

2:11:09And so he just goes on to share quite a lot about his experience experimenting with AI, what he would do at Doge, and some of these other organizations. So anyways, this is just a one that this is so smart because you don't have to be at these three organizations to be like this guy clearly has agency knows what he's interested in i should reach out to him and uh you know this uh makes me want to talk to him about roles that i met him in some random group chat and always liked what he was saying and i think i referred him to patrick o'shaughnessy for like one of those o'shaughnessy venture osv nice program and i don't know if that panned out but then a couple days later, Will Manitis was asking for someone to help him with some project.

2:11:54Oh, yeah. And I tagged Jacob and was like, hey, you guys should talk. And Will texted me like, where are you finding these boys? Like, how did you find this man? It's like the brothers. Yeah, it's the brothers, Will. Like, get used to it. This is the most powerful online fraternity in the world. It really is. It's great. But yeah, I mean, it would be a great pickup for the right organization. So put them to work. We look forward to doing the personality. news. Jacob, the only other thing I would say, join the cage, build something. You'll find yourself in the cage and you might find product market fit.

2:12:27Yeah. Or you'll die. The stakes are high. Let's do a bucket poll. I love this one. James Hawkins says, oh, this is such a low tam banger. 36 likes. I love when we find a low tam banger. Jordan, you got to pay attention to this, man. This is a good one. Sorry. Sorry. You got to lock in. So James says, your dream life isn't that expensive. San Francisco apartment,$7 ,500 per month. Rivian R1S, $1 ,000 per month. I can think of a lot better cars. Ski home in Aspen,$49 ,000 a month. Yacht that's one meter longer than Jeff Bezos' yacht,$30 million a month. $30 million a month? No way. I think it's like a billion dollar yacht, right?

2:13:11Yeah, but still you're not paying 360 million a year to rent that yacht. I'm sorry. Anyway, maybe you're going$10 billion. Who knows? But he says it's the spirit of the post that matters here with the bucket pool. He says$30 ,057 ,500 per month. That's your dream life. You just need to get one client paying you$30 million. $57 ,500 and you're there. Ring that gong, baby. Oh, it's so good. Okay. See, that's the kind of thing people need motivation. Yeah. People need something. Just one client. Yeah. It's not about, oh, you need, you just need 10 clients paying you$8 ,333 a month, you know, to get one millionaire.

2:14:08Just get one that pays you 30. 30. Simple. exactly it's not the number like stop making excuses you don't even need a calculator the genetic lottery it exists win it no excuses win it uh let's go to another deranged bro idea uh banger from uh weapon outfitters.com i love this account uh i don't know if this is actually true but hey if you already own night vision goggles nods might as well give it a try i think I think my baby is more disturbed by the sensation of temperature shift than light, but I'm going to experiment. It's a post from a guy who says, I have a 13-month-old kid, a baby, and I don't want to turn on the light when I go in and check on him.

2:14:52So I put on my night vision goggles. The dude clearly just has a scope for his gun, night vision goggles. um with night i have when you're when you're 33m size 13 stay at home 33 year old male size 13 i don't know why he's saying that uh stay at home dad slash veteran with night vision and a child you realize by using icw you can disturb the child less thus allowing us to sleep more so he'll go in and change the diaper and then just pitch black for the baby i thought that was genius that's insane that is genius more tactical gear in in the in the bedroom yeah i in the baby's room i'm inclined i mean there's so so many moments as a parent where it's dark you want to keep the lights off and you got to do stuff oh diaper change yeah i do think it'd be you know potentially traumatizing for the child to see you fully get it up but you know the sound and when it turns on like in call of duty but maybe just let your kid watch zero dark 30 so they get more familiar with adults and night vision.

2:15:59There are like tactical baby gear companies. They're like kind of joke gag gifts and it's like a bulletproof vest but it like has room for like diapers and stuff. It's very, very cute. I also think like nurseries, sometimes like if there's flat walls and there's echo, the baby's cry can just be so much louder because it's reverberating. So selling sound panels that are, that have like images that are appealing to babies. So like a cute photo that's printed onto a sound panel. Wallpaper sound panels. Exactly. Like nice wallpapers. Nursery sound panels. It looks like a, you know, a safari park or like giraffes and elephants, but it's sound panels.

2:16:36So it's dampening the crops. Those maps that are 3D. Yeah. Yeah. Yeah. I mean, anything. You can throw a tapestry on the wall. Yeah. How about some fine art? Fine art. Fine art actually does the same thing. Oh yeah. Totally. Especially if it's like a nice canvas. Yeah. So throw on a priceless work. I mean, even it's just, it's just a failure of like modern home design. that like we no longer use tapestries and floor, like the carpets, like you should have thick, lush carpets, tapestries on the wall, like, you know, exposed beams in the ceiling. And what are those called? Like, you know, it should look like the Sistine Chapel when you look up.

2:17:10Yeah. Anyway, the modern wonder. Do you want to do a promoted post? I'd like to do a promoted post because this 1954 Bentley R type continental fastback sports saloon by H.J. Mulliner is considered one of the most beautiful cars ever produced featuring a hand-formed aluminum body on a high-performance chassis and this thing is just fantastic I mean look at this John this screams SF daily you could do an engine swap and throw your you know if you have a Tesla Model 3 right now swap that engine into here and you know it's going to be a little bit annoying to charge it, but there's more and more of these, you know, supercharger stations.

2:17:53And this thing is just fantastic. I mean, I can imagine, imagine hearing that, you know, you, you know, picture this, you're driving down the 101 and you, you, you know, you're in bumper to bumper traffic in this car that presumably is, you know, multiple, you know, millions of dollars and you get this push notification that says, you know, we're in for the deal, like send over the contract, we'll sign five million air, our deal. And you're like, that just paid for this car. So like picture that, visualize that, go buy this and tell RM Sotheby's that the technology brothers sent you. Fantastic.

2:18:34Let's go to Grimes, throwing some shade on the timeline from a 20 VC clip with the founder of Suno. founder of Suno says it's not really enjoyable to make music now it takes a lot of time it takes a lot of practice you have to get really good at an instrument or really good at a piece of production software I think the majority of people don't enjoy the majority of time they spend making music and Grimes comes with some heat says this guy is a weak fuck boy and wants all of us to be week two. This POV in the AI community is literal poison and cope. People who want to destroy your dopamine receptors and make you intolerant to challenges hate humans and they are legitimately dangerous.

2:19:18Wow. Nuclear bomb going off on the timeline. You hate to see it. You love to see it. It happens every day. We got to cover it when it happens. I see both. I think both points of view are correct in their own ways. I think that it's awesome that a bunch of people are going to make music now that never made music before. When I think about growing up, you know, I had the benefit of parents that were insistent on piano lessons, guitar lessons. I had to, you know, singing lessons. I had to be making music weekly, daily. I was forced to practice. I went through periods where I didn't like it, went through periods where I loved it.

2:19:55And that was all I wanted to do. Um, but yeah, I, I don't remember, I remember as a kid being, you know, thinking to myself, I don't want to practice piano right now, but that was more so because I wasn't, I just was like seven years old and I wanted to, I don't know, like throw rocks at the house or something like that. Um, so I think that, uh, but, but it's the same thing. I saw other people making the comparison of a marathon runner doesn't go oh I'm so annoyed that I have this blister that's so annoying I I wish that I just never had any like adverse situations they're not thinking in that way right so a musician who's like I've trained my whole I had to train for two decades to get this good at violin that's so annoying I wish I could have gotten here in in a day right nobody I don't really don't think that's how people think yeah but simultaneously it's great that there's new tools that will make it simple for people to create beautiful art right even though it's just definitely machine oriented and so this same type of pushback against dg djs and electronic music of you don't have a full orchestra why are you you know this isn't real music so I think there will be this separation a continuing separation of artisanal handcrafted music and then music that sounds very similar that was created by machines.

2:21:16Yeah, there's some DJs that like they're EDM, but they have like almost a live band when they perform and everything's like live drumming. There's kind of like the good ending I think here looks like there's an app, I think it's called Synthesia that you can run on your laptop above the piano. And it turns, it's a real piano that you're playing, but as you're playing, it moves the notes down visually. So instead of reading sheet music, you can just see like it's the key to the left. Yeah. And that makes piano like way easier. Like Guitar Hero. It's like Guitar Hero. Yeah. But you're playing the actual instrument, which is cool.

2:21:53So it's like kind of cheating. And then a lot of music production in hip hop and rap specifically is just like almost just assembling other stems. So there's like, you know, there's like these famous beats from like vinyl records that like Kanye will sample and then put that. And then it's like, he's not really writing that particular melody, he's just kind of rearranging it. And I can see Suno being useful for like, blocking out tracks, I know people are using it for stands. Yeah, and Mike's argument would be that Suno's gonna be a gateway drug for people to fall in love with making music and get addicted to making music, and then as they get more into it, they will, well, maybe I should learn this instrument, or maybe I should do this live, or maybe I should sing this myself, right?

2:22:36So presumably, if you make it much easier to do something, it will introduce more people to it but yeah i mean i don't think i i think jen i think grimes is also right in that saying uh we should only do things that are easy yeah is yeah is yeah it's just the most controversial framing possible on this but but he's clearly trying to piss off traditional music we already went through all this with the ai art stuff where it's like yeah the the ai art that actually goes viral or is stuff that's like inspired like the harry Potter Balenciaga thing where that was yeah it was all AI generated but the prompt wasn't make something viral the prompt was clearly from a human thinking about okay it's interesting to combine Harry Potter and Balenciaga these two things on the opposite ends of the spectrum yeah and then I'm gonna do all the puppeteering of this and put it all together and have this song in there and like Suno will be a tool in that toolkit in the same way that content aware fill is a tool in the Photoshop toolkit or generative fill is.

2:23:35I mean, just yesterday I was mapping out that like, that like spec ad that we're working on for the next video. And I was using a lot of movie B-roll and then using some, some, some audio. And I was looking for different songs. And it was like, I was really having to shuffle through all the different songs that we could possibly fit in there. And it would have been, I probably could have prompted something for like, I just need generically dramatic music right here. and then I just want higher energy music during this section and I just want to have it paced out a little bit. And some of the stock music sites allow you to filter for that stuff, but you still have to listen to a lot of it.

2:24:08And clearly, you know, the good ending just becomes a cool tool. One thing is that electronic music has not killed live music. It seems in many ways just as loved and enjoyed as ever. Yeah. Should we go to Sean Frank? He says, do you want more domestic manufacturing? Current consensus is to court multinationals with tax breaks, tariffs, and tens of billions in funding. I suggest a different plan. What makes China so powerful isn't Foxconn. It's the literal tens of thousands of solo factories making everything from buttons to springs to toys. We should build up, build the small mom-and-pop factories because they train people, that make the parts that make the things we buy.

2:24:51One giant automated mega factory is awesome, but if you want 100 good factories, you need about 10 ,000 shitty ones, barely figuring it out. The CHIPS Act is great, but we need a shit act. Seriously, hire, invent, and train. Invest and train, S-H-I-T. $10 billion in zero interest loans. I love the sound of that. To start new factories at 10 million blocks only. Start paying back when you get to 10 million revenue. So Sean is goaded in so many ways, not just as an operator running the most profitable wallet company in history, but uh he just is hilarious and um you know uh his ability to coin is is phenomenal i think uh he's really leaning into coogan's law on this one and and claiming the shit act but um i got a you know front row seat to ridge's operations in the early days and um they developed a really strong relationship with a specific factory that they built up over time and many visits and i think eventually they just took over all their production capacity um and every consumer product and hardware company today will tell you that everybody goes out and they look at the whole world where can we make this thing and they always end up in china because china's half the cost and the products and the output's better and it's more consistent and yeah you have to deal with chinese new year and longer shipping times but it's just so much better and so um carried no interest is also talking about this as well, like we need massive, if we want to take this seriously, we need massive, massive, massive subsidies.

2:26:25And so both these legendary posters are right and I do, I support the shit act. Well we were talking about this with the American Toy Company, just this idea of like, there's a, I mean you buy toys for kids and they're all just made in China and they're all these cheap plastic and they're clearly designed to be used for three months and thrown away. And they're not something that will be passed down, Whereas if you look at like your grandparents, they have toys that were passed down to your parents probably. Right. And it's sad. It's emotional. And that emotion can drive consumer behavior. And so if you start a company that their whole brand is like, these toys are made in America.

2:27:00They still do all the cool things. They entertain. They have LEDs and music and all this stuff. They're four to five times the cost. Yeah. But they are more expensive. It's a luxury good. It's more expensive. But then when you build, I had this, I was talking to Trey about this, like, like, you know, maybe to, to, to, you know, we get the missile factory after we get it. get like the Happy Meal factory. And it's like, yeah, let's just have, you know, like Hadrian's obviously doing incredibly important stuff right now with like very key defense companies that need products right now. And that's important.

2:27:30But maybe we also need a Happy Meal startup. That's just like, yeah, we do injection molded plastic and we just do it pretty well. And we do it as well as we possibly can in America. And maybe the tariffs will help with that. Maybe the consumer choices will help with that. But we're dedicated to this for the long term. And over long term we think we will be able to get a parody yeah with with robotics yeah that's a request that's a request for starters by the way american toy company please somebody build it i think you could sell items that currently go into a toy store look at all the stuff that currently is made twenty dollars make those items for fifty to a hundred dollars here in america make them really really good and and and i'll just tell you uh this is more like a request for dinos because i buy and i've seen an obscene amount of dinosaur toys and i like buying the ones that are these heavy rubber because i'm like well i'm going to be able to re i'm going to be able to donate this and it'll still be in really good condition i don't want this cheap stuff and and like nine times in it yeah put an llm in it i mean nine times out of ten you're so much better off getting a small child like one really amazing toy than like 20 toys where that just cause a lot of clutter like the clutter builds up no matter what with the toys and so like if you came to me and you're like there's this amazing toy that's really popular and it's three grand or something i'd be like hell yeah like that sounds amazing um whereas like instead of it's like oh like you go to the toy store it's like everything's like 20 bucks which is like great because everyone can have toys but like there's definitely the first time in my adult life there was as an adult there gets to a point where all the stuff you want costs five grand and up and uh and so it's great walking into a toy store and being you know like i'm gonna buy the whole store myself but at the same time i'd much rather buy and and you want something that's like an italian suit something that yeah something one of yeah just i want something that's wooden cool materials yes you know boston dynamics like that type of stuff they they they're making these like uh transformer toys that a couple of them went went viral i actually do want to i want to get a i want to get a i want to somebody make a boston dynamics kids toy dog yeah because i'd like a dog but i want to be able to turn it off yeah I don't want it to poop in the house.

2:29:39And, but I still want it to be fluffy and loving and conscientious. And I think that LLMs can do that. So toy dogs that toy dogs for kids, 500 bucks to a thousand dollars. You can probably charge more because like a dog is pretty expensive. You don't have to feed it. Just got to plug it into the wall. It barks. It, you know, develops a relationship with your child and you never have to take it to the wood chip. And it has an AR 15 inside in case it needs to do some home defense. All right. We should just keep going with it. Let's do a bucket poll. Luxury watch guy. First time on the show, but I've been a follower of his for a while.

2:30:16He says, 2025 prediction. Zuck is going to end the Apple Watch. This is not satire. I have had a few big boys from Silicon Valley DM me that they want to start building collections. And so I think this is right. Obviously, we have been big on this and we're pushing for everyone in Silicon Valley to start building watch collections. But I don't think it'll be the end of the Apple Watch because they don't make enough FP jorns to satisfy demand. It's just impossible. Yeah. I just recommend if you're obsessed with your Apple Watch, you got two wrists for a reason. God gave you two wrists. Put them to use.

2:30:55Throw the Apple Watch on your ankle. Yeah, that's more of like an ankle. That's more of like a long house technology. So throw it on the ankle. I got exposed ankles. You're slapping. It's much more of a, you know, you're. No, I mean, if Zuck wanted to really kill the Apple Watch, he would need to launch a competitive product, something. I want, here's what I want. I want the Meta Watch and it's just the Reels feed. Yeah. And you can just watch. Swipe constantly. Swipe all day. There's no other functionality. Just constantly content. I mean, the new Orion headset does have a watch. It's not an actual watch, it's just a wristband, but it measures what your hands are doing and then that translates into the augmented reality experience.

2:31:37And so you could imagine if they really want people to wear the glasses all the time and they want people to have the wristband all the time, well, throwing watch functionality out and making it look like a watch, making this look like sunglasses or eyeglasses and making this look like an actual watch is gonna be much easier than saying, okay, you still have a watch, but then you also have this wristband. It's actually, I really wonder why Meta hasn't done a smart smart watch at least for the international market that runs on whatsapp right yeah you know when somebody messages you in america on whatsapp you're like really dude we're both here we're both here let's jump over to the you know i message like we don't have to do this yeah um but you'd think that they would have done something in that lane given um well They tried to do a phone.

2:32:24Chamath was on the project, apparently. And it didn't go well. Yeah, the Facebook phone. Lost 95 % of the... Chamath's just sitting there like, what if we spun this out as a SPAC? No. But yeah, getting into hardware is really hard, especially if it's an existing platform where there's this entrenched duopoly, getting people to switch is really hard. Tricky. Yeah. It would be cool to see if Zuck took a sabbatical or a trip to his island in Hawaii and was like, let me just think of a cool consumer device instead of thinking about what needs to be at the platform to lock in and all that stuff. The thing I've liked about these AI hardware startups is the shots on goal.

2:33:10Totally. and people think about software as it's okay for software to take shots on goal and have misses right think about how willing people are to experiment with software yet with hardware there there seems to be this sense of it's super embarrassing if a hardware device flops like we should only do it if if like we're gonna really make it the core thing whereas meta is like okay hey, figure out a way to spend$20 million, which is a rounding error for Meta to make a new - They've never done that. They spend 10 billion on the - Yeah, yeah. Like they're spending 10 billion on everything. Why doesn't Duck - Oh, yeah, yeah.

2:33:49Set up a Skunk Works team. Skunk Works where it's like, you know, Avi from Friend is launching a consumer hardware device for$5 million. Yeah, yeah, yeah. So why don't you do a bunch of stuff like that? And four and a half of that's on the domain, right? Yeah, exactly. But you can like distribute, just like think of it as as you know it's okay for it to be ephemeral and it's okay to just put stuff out there and i want our big our lovely big american tech companies to just be innovating and just like doing cool stuff launch a printer launch a printer we badly need a better printer um that can do 10 000 uh pages a minute um we should uh maybe do one more and then wrap it up yeah let's do at this rate we could hit five hours we could do our first five hour show but our children want to yeah let's go to Dennis he says you just got lucky is equivalent to I failed more times than you tried I like that a little bit of just an inspirational quote yeah no it's great I mean there's so much most of the successful entrepreneurs I know have failed more times than the entrepreneurs have I know have ever tried right and it the most the worst thing is when somebody who wants to be an entrepreneur tries really hard and fails and just gives up completely and that happens so much so um you just gotta take a bunch of shots on goal and that's one of the the honestly the downsides of venture capital is the stakes become so much higher and now it's become easier for people to raise venture capital and so I feel like the The stakes are getting lower in a sense.

2:35:27No, the stakes are lower. I got$10 million. I got a 400K salary on day one. No, but it's more like when you raise venture capital, you're taking people's hard-earned money. And then you have to turn that into multiples. And you're certainly trying to build a business faster. The emotional pain and turmoil if you don't do that is so real. And then, okay, if your company sort of works and you're stuck on that idea. If it doesn't work, maybe you operate for a few years and then whatever. And so it eats up way more time. Whereas when you don't raise venture capital, you can just ship, ship, ship, fail, fail.

2:36:08You're not wasting any resource except your own time and money. And so I think there would be less capital incineration if more people were just... I would like to add that luck is a skill issue. And if you feel like you're not lucky, you need to get your feng shui in order. You need to make sure your desk is in the power position. Make sure something in your life is the Chinese number of wealth. Eight. Many things in your life. Phone, address. Everything should add up to eight. Business partners. Yes, exactly. Group chats. Yeah. So get your feng shui correct. Make sure your desk is in the power position.

2:36:47It's easy to do. Just move the desk. Follow astrology. Yes. Do not incorporate without consulting with the stars. yeah make sure it's the right time to get on stripe atlas yeah stripe atlas should have an astrology it's like hey before you hit submit you're gonna have a better chance if you just wait 12 you know 12 hours and let it take over the next day jeff jeff weinstein over at stripe atlas please add an astrological incorporation functionality yeah we need to make sure it's the right time it just can be devastating if you do it at the wrong in the wrong uh day month exactly year.