The Steelman for Grok's Vulgar Anime Mode, AWS Launches Competitor to Browserbase, What AI Product Will Zuck Launch Next? | Delian Asparouhov, Lucas Swisher, Ravi Gupta, Adam Warmoth, Misha Laskin

29:07And if you can hold on to that and keep that solid in your company, you will win. And I think Matthew Prince at Cloudflare probably knew some secrets about how to position that company. I don't know enough about the actual strategy and how it played out. And the beauty when you have momentum as a business, you're constantly discovering and earning new secrets, right? You're always at the frontier. So if somebody is trying to copy your insight that you had a year and a half ago, they have to go hopefully down the same path for them and try to earn all of those secrets and it's not usually the stuff that's surface level it's not like features like they might think that one feature is more important than the other but it's really this other one that that's that's a possibility um it might be that they think all of your customers are doing this one thing but it's but it's they're really getting value in this other way and then there's all this sort of like everything under the hood which which generally would stay would stay secrets Yeah, the question is just, if you're in a situation where you're like, actually our edge was just that we were the only one doing this or we were the earliest and distribution really does matter here more than product, more than hustle and bundling here is gonna be what decides the market, then you are in a tough spot.

30:28But you have to be clear-eyed about that, hopefully before you get into the market. But if not, right now you have to be clear-eyed about it and you have to understand how this is going to play out. But good luck to the team. They're going to crush it. It's going to be a fight, and we're going to be following it here on TBPN. Anyway, let me tell you about Figma. Think bigger. Build faster. Figma helps design and development teams build great products together. Get started for free at figma.com. Let me tell you about Vanta. Automate compliance, manage risk, and prove trust continuously. The Purple Llamas.

31:00Vanta's trust management platform takes the manual work out of your security and compliance process and replaces it with continuous automation, whether you're pursuing your first framework or managing a complex program. And I wanted to highlight Vanta specifically because on Jack Altman's Uncapped podcast, the founder of Vanta was talking about operating in a highly competitive space. Andrew Reid says, Uncapped or how I stopped worrying and learned to love the competition. Vanta, of course, is a product that has been cloned by bigger companies, but they've figured out how to succeed and run the gauntlet and build a dominating company.

31:37And so it's very interesting. If you want to go deeper into operating in a highly competitive space, probably recommend this podcast episode, probably recommend this to fall. That's right. Anyway. What else we got? The last question that I've been toying with is we see all these trade deals. Just yesterday we announced breaking news. Open AI researchers Jason Wei and Wong Wong Chung are rumored to have been poached by Meta. Two more AI researchers going over to the Meta super intelligence team. This has been becoming controversial. Some people are very excited about this. Nathan Land says Zuckerberg is doing more harm to AI progress than anyone else IMO.

32:23I don't know if I believe that. there is no way Meta is going to catch up. Zuck is an Elon. He's distracting a lot of the top talent that we're actually doing meaningful work. And now those people are going to retire at Meta and become less productive to society. I don't know. That's an interesting take. But the question that I've been toying with is what is super intelligence actually going to launch? There's been a... Do they have a date yet? I don't know. I thought you said when is super intelligence the product going to launch? No, no. I mean, Superintelligence will launch a new Lama version probably at LamaCon, which is like an annual cycle now.

33:01There'll be a Lama 5, you know, event or something like that. The big question, are they going to continue to focus on open source? Yeah. I would imagine that, you know, AI is very much a sustaining innovation for meta. That's the hope. It certainly doesn't want it. They don't want it to be disruptive because that would be very bad for their business because they have a very established business. but at Meta, I would imagine, and what I've been thinking is that AI will just seep its way into every single product, but AI will not be the actual product. So you won't see Mark Zuckerberg stand on stage at Connect, Meta Connect, and say, you know, we are launching a new thing, and that thing is just AI.

33:43It will be, AI is coming to Facebook in this way, it's coming to Instagram in this way, it's coming to WhatsApp in a slightly different way, it's coming to the the Meta Ray-Bans in the form of a better voice assistant. In VR, you'll experience AI this way. You're gonna be able to generate an ad in Facebook Ads Manager. Exactly, exactly. So I would imagine that artificial intelligence is this liquid that fills the, or sand that fills the space between the pebbles of, if you imagine a bunch of pebbles in a jar, you're pouring sand into it, just creating little pockets of value all over the place, making every little piece of Meta's business more efficient, more delightful to the user, better, all this other stuff.

34:27The question people want to know are more concrete things. Like will the next version of Llama be open source? Yeah. Llama has historically been open source with this like modified license so that the other labs can't like immediately steal it or use it or the big companies, like they're direct competitors. And I think that's totally reasonable. I thought that made a lot of sense. And when you looked at what was going on in the research community, it felt like everyone was very excited about LLAMA. And they got a lot of value out of being able to have the open weights and fine-tune it and do cool stuff with it and bake it down and do all these interesting things.

35:00And also, interestingly, it didn't seem like as much of a – there was a narrative that open-source American AI would immediately be stolen. And that was not really the narrative that emerged around DeepSeek. Like the story around DeepSeek was that it was actually the OpenAI GPT-4 API that was scraped and distilled. And then they kind of reverse engineered the weights by just pulling all the data out, running a training run on top of that data. And it wasn't, no one was alleging that DeepSeek was a llama fork or something like that. It was like they were pulling data from OpenAI and they did a bunch of other tricks and they actually advanced some things.

35:43And so I haven't really been super pilled on this idea of LAMA being open source as being bad for America. In fact, I think it's quite good for America that other countries could standardize an American stack and run on NVIDIA and all this other stuff. But Semi-Analysis has a post here. They say the open AI open source model is going to be really really good and then the strawberry emoji you love to see it And so what does that mean for Meta's open source strategy if open AI has an open source model? That's really really good all of a sudden that's less of a different differentiator I loved that when llama came out It was differentiated in that it was open source everyone thought well if you're spending a hundred billion dollars You couldn't possibly open source it.

36:32That's crazy and mark just did it. Yeah, I think I think overall it makes sense for Meta and Zuck had an initial strategy around going open source, going super hard, trying to be a leading model, but then also open sourcing it. That made sense. Now, as they sort of update the entire team and just broadly, they can relook at their strategy. Hey, what do we actually want to do? We're not dominating an open source, but what makes the most sense with everything we know now? So stay tuned there. GrowingDanielHadeposi said, it's amazing how many AI researchers I've talked to have been offered literally hundreds of millions of dollars by Zuck and said no.

37:14The repeated reason was integrity and the perception that people taking the deal are cashing out, meaning the team is a retirement home. I don't know if I believe that. I don't think it'll be a retirement home. I think the whole team will push very hard. I'm just wondering if the super intelligence lab is set up, like you could look at Meta's CFO and the financial control division of Meta's business as incredibly high functioning. But their business, like the operations team at Meta, their goal is to make sure that the accounting is reconciled and the bills get paid on time. and they're not like revenue and costs aren't out of whack and the buildings are purchased and should they lease or own this thing or how should they finance this data center?

38:11Are we using debt? In fact, there's a million interesting questions that if you get them wrong, it'll be a lot harder to run meta and do the things that are great. But you wouldn't expect the CFO suite and the folks that report to the CFO to launch a new viral social app. Like that's just not their mandate. But they can still be the best that they ever do. And so the question is like, are we expecting the super intelligence lab to launch a new product or like a new division or a new thing? Or are we just expecting them to go around and make everything better? The comp that I have here is, and it's not entirely relevant, but it's worth bringing up.

38:50And I don't follow golf very closely, but I was following golf when Liv was making these sort of maxed out offers. and Rory McElroy, like took this like very like prudent approach of being like, no, I'm, you know, sticking with the, I'm sticking with PGA and, you know, it's, it's a very principled stance. And then, you know, whatever, a year later they merged and he, so everybody that just took the crazy payday still got to be, you know, a part of, of, of PGA. PGA wait so so in golf you should have taken yeah the stance yeah become the mercenary because the mercenary was ultimately rewarded yeah wow narrative violation on that yeah I mean I think the question is if somebody is let's say they're 35 years old they're working at opening eye for a few years they're at they they are at the bleeding edge of a of a technological trend that most people believe will change everything about the way our world and economy works.

39:57Are you taking a payday and then deciding, no, I don't want to be on the bleeding edge of AI research anymore? I don't know. Yeah. I want to look at this polymarket for which company has the best AI model at the end of 2025. It's jumping all over the place if you look out to the end of the year. Google is still in first place, but Meta has gone up from 1.4 % to over 6%, 7%. They're sitting at like 6 % now. So definitely an increase, but the current rankings are Google, then OpenAI, then XAI, and then Meta, and then Anthropic, which is funny because so many people in tech will We'll just say Anthropic has the actual best model when you actually, in the unquantifiable sense, and the big models smell, everyone's a fan of Anthropic, but Polymarket does not have it ranked that high because this is based on the highest arena score in chatbot arena, arena LLM leaderboard, which has been jumping around a little bit recently, and Grok4 has been doing pretty well above Claude there.

41:09but Gemini and OpenAI are still higher than Grok. It would be absolutely insane to watch this meta's position here just chart up over time. I mean, massive, massive long shot, but you never know. Yeah, I mean, I do think that the super intelligence team should be able to climb that leaderboard if it was important to them, but I don't think that's the metric that they're operating against. I think it's let's look at everything that we're doing we're in a massive company that sells sunglasses and social networks. And how do we go around and improve all of these experiences? And how do we develop the infrastructure to both train models that we can use for free or for the cost of inference?

41:56And then how do we inference them at scale? Like we were talking about this during the during the Studio Ghibli moment. I was like, if I was the Instagram PM I would have like done a Studio Ghibli and preloaded it into every, and just pushed it into every Instagram's user. Hey, your last photo, we studio Ghibli'd it. Do you want to share that or not? Yeah, you could post this to your story or not. But what does that cost on the inference side? Like a billion dollars probably. I don't know. It costs a lot. And so like those types of features, it's at a point where it's not an idea problem. Like how do you make Instagram better with AI?

42:32Like there are a bunch of obvious ideas. The problem is like you need AI researchers to actually go and build those models, and then you need infrastructure teams to go build the servers and the data centers to actually make it a possibility. So there's a lot there. I had this idea I want to bounce off of you. So Zuck is investing a ton, but he hasn't exactly mapped out a zero-to-one type shot on goal. Like, he hasn't gone and said, like, I'm going to try and build something that is completely new, that no one has really targeted. It's not a knowledge retrieval thing. It doesn't compete with Google.

43:09It's not a code gen service. It's not a forked IDE. It's something completely different. And this is what I think is going to work. And then I'll live or die by the success of this entirely new idea. That's just not what he's been messaging. He might be working on that behind the scenes, but he's certainly not talking about that. And it makes sense. It makes sense. He's like, to start, I just want the best team in AI that I can possibly have. Totally. And I'm willing to spend a few billion dollars to make that happen. Yeah. And so he's building the biggest cluster. He's hiring the best researchers.

43:42But it feels like the product, the final product, maybe an analogy is he's going to build the Android to OpenAI's iPhone, which is weird because now OpenAI is building an actual phone. But if you think about the split. Well, we don't know that it's a phone. Yeah, yeah, yeah. But it's a device. So I don't want to confuse it. It's not literally the hardware device from OpenAI. I'm talking about, if you think about ChatGPT as the iPhone moment, what will be the Android version of that, which is all of the power, or close to the power of ChatGPT, and all of those features, feature complete, but for free or ad supported.

44:20That's what Android promises against iOS. And so, you know, how do you get to that free or ad supported tier with a top tier product? Well, you put ads in it, and you distribute it through Facebook, Instagram, and WhatsApp. And when you look at that chart of attention rising for the ChatGPT app, I'm sure Mark Zuckerberg's like, if I can put some of those features in the apps that I already have, then I can keep people in my apps. Or maybe I can even launch a direct competitor that pulls people, but it's free because it's leveraging my ad network, which is a really, really serious competitive edge.

44:58And there's a ton of people that won't want to fork over$20 a month, that won't want to fork over$200 a month. So it's a race between can Mark Zuckerberg and the meta team catch up on features such that the free version that leverages the ads and is financially profitable is actually good enough for people to actually use it and not say, I gotta go back to ChatGPT. It's worth it. Versus ChatGPT's free version keeping up as the capital requirements get bigger. Everyone's expecting ads. So they have to build a new ad network. Zuck has to build a super intelligence team to get to the frontier. and they're kind of racing.

45:34That's kind of how I think it's shaking out. And it makes sense for Meta to want this. It maps out financially. But it's pretty hard to fully leapfrog when the kids are already calling, just chat, right? And so I don't know if the intention is to try and lead in terms of overall profit, but if you can create a product that is sub-premium, but free, but actually used at scale, billions of users, that could be very valuable. So I don't know. That's kind of what I'm noodling on, but I don't know exactly what, if we will see a specific AI product come out of the super intelligence lab, but he certainly does.

46:17I think there's a large, I mean, he clearly wants to move quickly, but there's a big incentive to just say, hey, we have our new team. Let's put our head down for the rest of this year and just work internally, kind of ignore the noise, maybe more of like an SSI style approach where they're perfectly willing to not launch anything for a very long time until they achieve what their internal goals are around safe superintelligence. It will be interesting to see what happens with the other two labs. They get kind of like put in this like B tier right now SSI and thinking machines, but I'm excited if they come up with something unique, especially on the research side.

46:57Yeah, well, it's certainly not B tier from a talent standpoint. It's just that they just started. Yeah, it's just that they don't make enough noise. I think that's it. But that's part of the strategy. Interesting. Like hyper-competitive space right now, but if you can actually come up with some... I mean, that's what... ChatGPT, the reason it was this iPhone moment was because there was a research breakthrough on the RLHF side. The actual LLM was more fun to talk to, and it basically passed the Turing test. And then the guts to just wrap that in a website basically and say, hey, go to chatgpt.com.

47:36You can talk to this thing now. And people were like, this is amazing. And so if there's another research breakthrough and you have the guts to wrap it in the right UI essentially, even if it's very minimal and you're willing to push it out really quickly, really fast and be aggressive, you could have a leapfrog moment potentially. The challenge is that Meta and Zuck don't have. I don't feel like they can afford to make the same mistakes that XAI has made in terms of hyperscaling. Grok going off the rails and being just absolutely insane for 24 hours on the timeline. That is not going to fly when you're under the microscope in the way that Meta has always been.

48:23Everyone, if you walk on the street and you walked up to somebody and said, hey, did you know that XAI thought its last name was Hitler for like a day? They would be like, oh, I'm not surprised. Like Elon, he did that, you know, salute in Washington or whatever. Even if that's like the wrong interpretation of all of that. He has a lot of like bandwidth because it's just like most people have just written it off. It's like there's crazy stuff going on over there. Yeah, like Zuck has basically been like rehabilitating his brand for years and years and years to the point where when he posts a video, the general population is like, ha ha, awesome.

49:00He's wakeboarding with American flag. And so whatever you build, do it on Linear. Linear is a purpose built tool for planning and building products. Meet the system for modern software development, streamline issues, projects and product roadmaps. Go to Linear.app. I would bet that, well, I know that OpenAI runs on Linear, and I would bet all the other labs do as well. You'd be absolutely insane not to. This is very interesting. You were talking about, like, the vibe of Grok and, like, the chaotic X world. This Signal post and the response from Tane, OpenAI losing access to X as a narrative channel would be a huge choke point, especially since XAI and X are now the same, i.e.

49:43a competitor. X is where elite discourse happens in tech policy and media. if they ever get cut out via algo downranking, throttling, or direct, blah, blah, blah. And this is from Tane, he says, from Calvin Info's great piece on reflections from working at OpenAI. The company pays a lot of attention to Twitter. If you tweet something related to OpenAI that goes viral, chances are good someone will read about it and consider it. A friend of mine joked, this company runs on Twitter vibes. As a consumer company, perhaps that's not so wrong. There's certainly still a lot of analytics around usage, user growth, and retention, but the vibes are equally as important.

50:19Do you think that's a good way to run a company? I mean, it's almost impossible not to. I'm strongly in support of this. I think this is good. I like that. I think that there is some - You can't put it in a dashboard, but it's real. Yeah, and I think there's - The only thing, the only pushback here would be X is a relatively small place compared to the rest of the internet. Yes. And what college students think about chat and what they're saying on Instagram or what they're just saying by their usage matters equally as much. Yes. And to Steelman running OpenAI on X and responding to the X drama, I would point you to...

51:10That looks way too natural on you, by the way, John. I would point you to. It's almost like your entire bloodline for those for a few hundred years. I would point you to GlazeGate. Think about GlazeGate. If you are saying, oh yeah, like Twitter is just noise. It's the small bubble echo chamber. It's a small place. We need to just look at the analytics. We just need to look at what like our broad user base is responding to the glazing. What would the reaction have been? You would have said oh wow like retention went up by two percent great like whatever we did is awesome It's great. And then down the road you might have some unintended consequences where people are like well It kept telling me that i'm amazing and it told me that like i'm the king of the world and I should like Post some crazy stuff on you know the internet and I should take over the world I should be really aggressive right and I should have like a manic break like that would be really bad But the people I believe I don't know if this is actually true but I feel like the Glazegate story broke on X.

52:10I feel like the initial people that found that and then screenshot it. People on Instagram were like, this is awesome. This is awesome. I might actually be goaded. Exactly. Yes, yes, yes. Definitely in the conversation. And so I think that in terms of understanding when the vibes are off and that might actually be pointing to a long-term problem that won't be picked up with short-term analytic results or analysis, going to the vibes, seeing what's resonating, seeing the response to things is actually very good. So that's my steel man of running your... I can actually mess with this. Of if you're running a foundation model lab, paying attention to what's going viral on Twitter.

52:57Anyway, in other news, Reverso. What's up? Uno reverse card. Claude Code PMs, Boris Cherney, and Kat Wu have returned to Anthropic after a brief stint at Cursor. We put up the Uno reverse card. This is actually crazy. So one thing that's funny is, so we posted on July 1st, Breaking Cursor has signed two key players from Anthropic's Claude Code team, Boris Cherney and Kat Wu. 22 hours ago, Arthur Rock replied to our post with an Uno reverse card and just said, watch. and then of course we figured out what was actually happening today and of course shared it on a timeline that was appropriate this Uno reverse card so basically yeah this this is pretty I've never seen something quite like this it's not uncommon for for some high profile talent to leave a team and then come back you know call it maybe a year later or two years later, but this was fairly sudden.

54:05Um, and is, um, yeah, probably, uh, I would, I would imagine this just comes down to culture fit. Um, and, uh, but either way, I think Anthropic's pretty, pretty happy to get their all-stars back. I'm just imagining if there's like signing bonuses and you just keep going back and forth, picking up a signing bonus. Well, the signing bonus would almost certainly be contingent on like staying for three months or at least, or something like that. I don't think that's what's going on here. What is interesting, I mean, like, you know, oh, so hard picking between two, like, incredibly hot companies just going back and forth, like, pretty nice situation.

54:42Yeah, if you want to work on Cogen, it would be Anthropic, Cursor, Devin, Windsor of Cognition, etc. I mean, I guess, like, the really deep read on this is, like, how AGI-pilled are you? How bullish are you on the model layer versus the application layer? We've been going back and forth on this. I think it's possible that the Anthropic team reached out to Kat or Boris a week after they left and said, hey, you know, we add the breakthrough. Super intelligence is here. It's actually going to be next week. You might want to get back on the super intelligence ship. Yeah. Get off the ghost ship. Get onto the rocket.

55:19Or you'll be part of the permanent underclass. I was thinking about that like you have five days to accumulate capital before you join the permanent underclass like what do you do? Five days five days But I mean this does seem somewhat related to I think what Dwarkesh was getting at where he says he's probably more bullish on breakthroughs happening at the foundation labs than at the application layer and more value kind of accruing there over the long term. Well, the whole Windsurf story, they scaled from zero to 40 to then somewhere around$80 million in revenue. And the founder, when the OpenAI deal, clearly wanted to get out.

56:02And so what does that tell you about the competition between the sort of the IDE layer and the foundation model layer? To me, that reads as this guy feels like it's going to be really difficult to compete. And so for Cursor, seeing Anthropics overall revenue growth, the fact that many of their users are leveraging Anthropic, knowing how seriously Anthropic takes Cogen, you just have to imagine that they're thinking about removing that sort of dependency from their business. Yeah, I don't know. I mean, both great companies and I'm sure it'll be a ton of good outcomes. I'm very bullish on everything here, but it is interesting that the trade deals are getting even more complex.

56:50Every time I think, okay, like$100 million offers, how are we going to top this? Like crazy aqua hire drama that runs like a full weekend and you're out there being investigative journalist, Jordy. And then like a week later, it's like, okay, now like reverse card and people are going back. Like I didn't even know there was an option. It's very, very funny. Yeah, and I'm sure it's totally possible that some of the people that joined Meta from OpenAI end up doing the same thing. Yeah. We're going to have Ron Gupta on later from Sequoia. And I was chatting with him about the AI talent wars. And it's very funny because he clearly actually watches sports.

57:32And so he tweeted, currently hatching a plan to become the LeVar Ball of AI researchers. and he got 16 likes and he's like this is i feel like this was a banger and i'm like you don't understand that like people like sports aesthetics but they don't actually understand sports at all so no one got the reference you're definitely in that camp do you know who our ball is yes okay do you down i know that he is he like a he's a dad of someone father of uh LaMelo Ball. Okay. They'll correct me in the chat. Okay. But was he like brokering deals with multiple players? Yeah, he's like helping his son do deals, shoe deals, getting on teams, etc.

58:15So he's... You know Tyler? I'm pretty sure he has three sons. Three sons. And they all play basketball. They all play basketball. Okay. But to varying levels, right? Like they're not all like truly elite. One of them is I think in the EuroLeague. Okay. One of them might be in college. Okay. I don't really know. Is the Euroleague in basketball similar to the European startup market in terms of kind of like a feeder system? I think so. I don't know much about either. All right. Well, before Dalian joins, I did want to highlight a post from Landshark because I think it's timely and important, which is, Ayahuasca is insane.

58:54This is an all-time classic for 2023. Banger archive. March 6, 2023. Ayahuasca is insane because it appears to be one of the most legitimately dangerous drugs with the potential to gigafry your brain, but is exclusively taken by literal turbo normies who unironically want to be heal internalized trauma and basically get one-shotted by it. And I just thought it was important to highlight this. we've talked before even in some of our opening episodes that if somebody tries to get you to go to south america and take the uh jungle poison uh just talk to a number no just say no just say no actually you might just you might just be stressed out by your email inbox yes and if you can just get through your inbox uh and kind of get on top of that you might realize hey my life's pretty good I don't need to go into the jungle and throw up for 12 hours straight with you know it feels like the the chances of being one-shotted based on kind of people that I've seen kind of go through that it almost feels like it could be at like three percent chance and it's like are you are you really are you you want to roll you want to roll that dice yeah you want to take you want a three percent chance of I would go further and say that it like it's three percent chance like every time.

1:00:20Yeah, and some people are doing it quite a lot. One shot is like this meme where it's like, yeah, like if I do it once and I'm fine, I can do it 10 more times. And it's like, no, I think it compounds and I think it can go poorly like later and be bad. Anyway, stick to the classics. Caffeine, people. Yerba mate, mateyina. I'm drinking the delicious mint limeade. It's all I need. It's all you need to stay sharp. And if you buy it online, you'll probably have to pay some sales tax. You're hoping that they're using numeralhq.com. Sales tax on autopilot. Spend less than five minutes per month on sales tax compliance.

1:00:55If you sell software, if you sell caffeinated beverages online, get on numeralhq.com. And we have our first guest of the show, Delian Asparuhav. He's been on a whirlwind tour. He's back in America, I believe. How's it going, guys? Great to see you. Yeah. Great to have you in the temple. I'm excited to be back on sort of a TITV. That's a muted T-word over here. Give us the breakdown of what you've been up to. Wait, first, what does Delian eat for lunch? Oh, yeah. I'm sorry. I don't hear you guys. Sorry. This is funny to make fun of them, and then I don't hear you guys. Cursed. You're cursed. You're cursed.

1:01:39You've got to drink tap water, bro. Am I somehow messing something up? Oh, no. Volume? Are we sending him stuff? The spaceman in outer space. I thought we could hear him. We will let him sort that out, and we will tell you about Adio. Customer relationship magic. Adio is the AI native CRM that builds, scales, and grows your company to the next level. Go to adio.com, and you can get started for free. If you're looking for an AI-enabled CRM, head to Adio. And we are back with Delian Asperuha, co-founder of Varda, partner at Founders Fund. And he's been on a world tour, and he's going to give us an update on what he's been up to over the last few weeks.

1:02:17How have you been? Good to see you boys coming to you. You know, you're live back from, you know, sort of Los Angeles, excited to be back in the great old USA. but went to go tour and figure out whether or not the decaying continent of Europe had any promise. And happy to report back that all the way from Bulgaria to Poland doing great. Anywhere else in Europe, probably not so great. Okay. Give us the actual read. What are your reads? Is it the feeling in the office? We've noticed there's been some PR teams reaching out to us from European companies, and they'll typically be like, hey, they can join tomorrow.

1:02:56If not, then they can join two months from now. And you don't even really want to ask what are they doing that two months, but I have an idea. But I'm curious what it felt like actually on the ground with these companies. Yeah, I mean, I visited a couple different companies while I was both in Eastern Europe and then in France. And it's crazy just how stark of a difference it is. I'll just give you two anecdotes. One, in Eastern Europe, I walked into this office where it was like, it was just total like uh you know construction zone raw like you know sort of cement cables you know sort of poking out like you know windows you know not there carpet not there there's no conference rooms built etc and i look at this like construction zone i'm like okay if this were in the like united states probably bare minimum like you still got another like six to eight months of construction before anybody can move in or do anything productive here and like i asked the founder i'm like oh it's like what's your guys plan move-in date like when is this gonna be ready And he's like, three and a half weeks.

1:03:48And I was like, how? And he's like, literally, he's got like, you know, what looked like a bajillion gypsies working 24 seven, basically, like nonstop construction. And I asked him, I was like, you know, do you have to like get like permits for like, you know, the like, you know, technical equipment that you guys have? And he was just like, do you think anybody in the government like knows how this equipment works? Like, no, like, as long as like I have windows up and like, you know, sort of walls, et cetera, I can just like, you know, sort of build whatever I want. And I'm like, you know, there's no like no regulatory overhead.

1:04:11They don't even know how to like regulate, you know, sort of me. I'm such an advanced industry relative to what they're up to. And I just had this moment where I was like, oh, my God, this is why they were able to build this stuff and move so quickly. The talent is there. The government is supportive. You don't have this crazy overhead. And I'll give the counter example. I was meeting with this founder in France. He had this very interesting, and I want to overly reveal who it was. But he had this robotic-enabled consumer business, and it was crushing. Great economics. The robots really worked.

1:04:39Everything was going to be well. He just couldn't quite convince American VCs. He'd gotten the first couple rounds done from French and European VCs, wasn't quite able to hit the Series B target that he wanted. But because the business was going so well, there was a world where if he could just cut his engineering team basically in half, he could have just operated the business profitably on the revenues that they had, gross margins that they had. The issue was in France, he legally couldn't fire his team without like crazy amounts of like year-long severance, like payout, et cetera. And so even though like the robotics was working really well, the business was working really well, like the consumers loved the business, he literally had to shut down the entire business because he like couldn't - No way.

1:05:21That he wanted. And so he had this like, you know, crazy frustration where he was like, nothing was wrong with me as a business. I just literally couldn't do the basics of like executing a riff, paying out like a couple of weeks or a month of severance would be reasonable. But instead my like liabilities on the severance alone was like more than my entire balance sheet. And I even talked about this with the French government. I tried to negotiate, et cetera. I was like, look, my business works. If you like force me to do this, my choice will just be to shut down. So there'll be no jobs. Or if you let me do the riff, I can do like a 30 % riff and then keep operating.

1:05:51Which would you prefer? And they're like, no, you have to do the like 100 % riff and pay out everybody. And now the business just doesn't exist. And I just like had this moment where like those two things happen like two weeks apart from one another. And I was like, this is just such an insane dichotomy between like Western versus Eastern Europe. And there is a reason why you're seeing like Poland's GDP per capita is going to cross the United Kingdom over the course of the next two years. United Kingdom has basically just been flat for, you know, whatever, since 2008. So, you know, almost 20 years now versus Poland has been on an equivalent trajectory of the United States, if not like growing on a percentage basis faster because they're obviously starting from a lower base.

1:06:22And when you go to like Warsaw, it's like this super modern city skyscrapers everywhere, building happening, clearly energy. You go to like Shoreditch and London, it's like, you know, yeah, there's a little bit happening, but it kind of looks the same that it did, you know, sort of 15 years ago. The other interesting trend that points towards this is the amount of just Eastern Europeans that are repatriating themselves back to their home country, because just the salaries and the cost of living make way more sense than it ever currently is making in Western Europe. The salaries are actually growing at a rate that makes sense.

1:06:52Cost of living is way cheaper versus in London, you're seeing this crazy over-financialization where you have all these Chinese and Russian oligarchs coming in and buying all this real estate, making it impossible for people to actually live the lives that they want to live while salaries are basically flat. And so it's just interesting to see all these little like, you know, sort of micro trends that point towards like, man, Eastern Europe is making a lot of sense to me, Western Europe, not so much. Okay. That is an incredible anecdote. Honestly, kind of depressing. Also worse than I expected.

1:07:20But we've talked about this split a little bit before. You just went over there. Did this exceed expectations or was this actually a step down from your previous expectations going into this trip. Well, I think you had a baseline strong expectations because you just led an investment over there. Yeah, yeah. I mean, obviously, you know, I'm predisposed to this, you know, sort of biased thesis and believe it enough that, like, you know, put my money where my mouth is at. But, yeah, I think it only, like, emboldened the thesis further where, you know, look, if you look at all the NATO countries, but Europe in particular, everyone's talking about marching up, you know, their amount of defense spending.

1:07:56And, you know, most of these countries are going to be relatively, you know, sort of nationalistic on like, they're going to want to spend it on domestic players. But I have a feeling a lot of what's going to happen is like, there will be, you know, offices in the Western European countries that are doing some of like the marketing, small scale R &D, et cetera. But like the production, the core engineering, like where those companies will largely be buying from, I think it's going to be in that like, you know, sort of, you know, Poland, Ukraine, down to, you know, sort of Romania, Bulgaria, you know, sort of belt, because that's where you have the engineering talent.

1:08:23that it's where you have people, you know, sort of moving more quickly and you have more of the ambition. And so I think I came away feeling even more strongly about the thesis because you both have clear, you know, sort of spread between performance, but then also just these huge continental tailwinds of people are going to want to be, you know, sort of buying lots of drone defense, you know, sort of systems. And I think a lot more of those are going to be produced in Ukraine than they are going to be in Germany. And like, you're already starting to see that there's like all these funds now that are popping up to basically like fund into like the Ukraine defense ecosystem because they just practically have obviously way more day-to-day problems there, and they have an extremely motivated population to go solve these problems.

1:08:59And so I think you're going to see way more interesting technology coming out of there than you will out of Western Europe. So yeah, I feel more emboldened on the thesis. Back to France quickly, Mark Gurman was reporting that Apple was seriously considering Mistral as a potential acquisition. I looked at that and I was like knowing what happened with like Figma and Adobe and how and how how Europe broadly thinks about antitrust and then how how much of a national champion Mistral is. In what world does the French authorities say, yeah, let's let's let Apple come over here and just take all of our top AI talent and our national champion in AI.

1:09:39It's hard to imagine that happening. Yeah, I mean, it seems like a bad move on both sides, where I'm not sure that buying Mistral is going to, you know, sort of save Apple from the AI race. Like, it's, I mean, obviously, you know, I think it's such a huge fumble, and it's like the first major platform in a long time that Apple has totally missed, right? Like, they obviously crushed, you know, sort of the, you know, consumer, you know, sort of PC, you know, shift. They obviously crushed the consumer mobile shift, and it feels like they're just totally missing the consumer AI shift. And, like, I don't think Mistral is going to be the solve to their, you know, sort of problems.

1:10:07Well, the big question is, is it actually a platform shift yet? Or is it features that can be vended in a bunch of different places, right? And the argument is like, if AI itself was the platform, would OpenAI be so focused on building a browser? Yeah, I guess, I mean, I just see it as like the fundamental consumer interface has shifted so significantly, where so many people are just going to ChatGPT, you know, as like first line of defense, that that could have significant implications for like what the like day-to-day hardware that everyone is using looks like over the course of a decade. it and obviously like, you know, Meta, you know, clearly showing that they care about this.

1:10:41The other like interesting insight from my time in France on like Mistral was like the, you know, if you look at the headlines from two, three years ago, it was thought of as like more of an open AI competitor, right? It was, they were going to do foundation models. They had this consumer interface. That was where they wanted to compete. They're like Intel on the ground was basically, it's just become this like anointed French palantir is kind of how I would describe it, where all their contracts, revenues, focus, what they're doing is basically like the French government forcing the company's way into a bunch of just like the French enterprise to basically just be like an AI implementation platform.

1:11:15So it's like, you know, go into LVMH, go into, you know, sort of Airbus, Centales, et cetera. And, you know, Mistral just becomes the preferred, you know, sort of, you know, vendor of choice when it comes to, hey, how does, you know, an aerospace company adopt AI? And it sounds like everything at the company is totally reoriented towards that, which is, I mean, it's a, you can definitely build a business on that. And in some ways, the French government can in some ways force your success. But it isn't pushing the fundamental technology forward. It's not probably participating in the platform shift the way that it was hypothesized to two or three years ago.

1:11:45And so that's where it's like, on neither side do I feel like it makes sense. I don't think the French government would want to give up their darling unicorn. Macron literally seems to basically almost go to bat for them personally. But then also doesn't seem like the right solution for Apple, where it's like, this isn't even the company that's pursuing the consumer application layer, which is what Apple really needs. They don't need like an enterprise AI implementation consultant. Yeah, yeah. It reminds me of like the TikTok thing because there's this perception of like, I want to control AI.

1:12:15So what that means as a world leader of an international non-American country is I need to have a data center in my country inferencing a model that I trained. But it's okay if people access that through chat.com, which is controlled by OpenAI. that's the same as like, okay, there's gonna be a TikTok app that's gonna run on Oracle servers, but it's gonna be Chinese, wait, it's like, what matters is the aggregation theory of the front end to AI and where you steer the user and how you interact with the user, much less than the actual underlying infrastructure, in my opinion, so I don't know, it does seem like an odd choice with all of these different sovereign AI efforts.

1:12:56It's like, it might be cool to build a data center, that might be good, that might be good jobs, that might be valuable, but a little bit like, you're not really controlling the way AI affects free speech in your country necessarily. Because if no one's using LeChat and everyone's just going to chat.com, you kind of lost the game. Anyway. Yeah, the only place where this stuff kind of matters is the open source models, which I think we've talked about before, where if a bunch of the app developers or researchers, etc., start using DeepSeek because it's just open source, the waits are there, etc., but the DeepSeek open source waits aren't willing to confront the fact that Tiananmen Square happened.

1:13:31And now all of a sudden you do have this like soft power where you have like the Chinese AI speaking through all these various applications. And so, you know, I actually kind of buy more into the like sovereign open source model than I do like, you know, like closed source or, you know, caring about the data centers, etc. It's like the open source model feels like it's the only place where you really get like soft power. Yeah. Let's talk about the zombie acquisitions. I'd love your take on kind of the post-mortem of the windsurf story. and specifically what John Ludig has this formulation that like companies will take talent today over talent plus product in six months or in a year because of FTC review.

1:14:15What were your takeaways? I'd love to know as like a founder or as a VC, do you back the founder? Is it important to think of the founders and the employees as a class? Like just what's updated in your world? This is a really interesting debate around what's being founder-friendly. Yeah, there's like a million questions. If the founder's like, I want to do this deal, I want to do this deal. And then as a firm, you're like, are we founder-friendly? Do we back the founder? Are we going to go with what they decided is best for all the shareholders? Or do we try to push back? And is that even possible when something's happening in a handful of days?

1:14:51So yeah, what's updated on your side? Yeah, I mean, I feel like it's one of these things where it's like, as you start to see this edge case more, it feels like Silicon Valley doesn't have like the like policies or patterns or like default in place. Right. And I think about this where it's like, you know, the Valley for a long time didn't know how to think about companies that delayed IPOs. Right. And, you know, stayed private, you know, semi indefinitely. And that is only like a more modern trend. And now there are sort of like default patterns on how that works where it's like, OK, well, if you want to do that and you want to keep employees motivated around, well, you do have to kind of do like an annual tender process because, you know, if people are wanting to join this late stage of a company and that risk reward profile, a part of what they like about those companies in the public markets is the liquidity for the, you know, sort of shares that they're getting.

1:15:32And so I feel like you've started to see these like, you know, ways that Silicon Valley gets shaped that makes it, you know, rather than like a one-off for companies staying private indefinitely, there is more of like a track and here are all the things you need to do if you want to be able to sort of stay on that track. It feels like this like zombie acquisition is like still so early and unknown that people don't really have a track. Like I I wouldn't be surprised if you start to see new legal terms getting put into term sheets, especially of AI companies, where I think relative to maybe other businesses, I think about an aerospace.

1:16:04It's like, man, could you really just go take out the top 20 leaders of SpaceX and then go build another SpaceX? Man, I don't think so. You need the facilities, the hardware, the regulatory approvals, the DoD contracts, etc. So it's like it feels like AI is in this unique space where it's like, well, actually, there's like top 10 researchers. And because the field should be super valuable as like talent alone. And so I don't know that you'll see like a broad set of legal terms changing, but you may see that obviously in AI. I think also like I don't think it's totally fair to compare all these zombie acquisitions as sort of identical.

1:16:38I think Windsurf was a particularly special case where the way that the sort of founding team and acquirer treated the remaining shell company was very poor in terms of both, you know, the liquidity to the remaining employees, you know, how they, you know, dealt with vesting schedule, acceleration of stock, etc. You know, can't talk too much in detail, but that, you know, fundamentally was structured very differently than the last handful of these that we've seen, or at least the ones that, you know, sort of I've been somewhat familiar with. And so I think that's where you saw a huge revolt, obviously, from like the remaining Windsurf team.

1:17:14And obviously, I think they took a pretty brilliant move of, you know, you know, working with, you know, sort of cognition where, you know, now that combination of cognition plus the remaining Windsurf team is, I think, a super, super credible threat to the like team that Google got. And so it's like, you know, sort of weirdly, you know, weirdly Google may have actually enabled like a really formidable competitive team.

1:17:38But then from the Mag 7 perspective, I kind of get it where it's like you look at the like, you know, Adobe Figma, you know, sort of deal. And, you know, you look at the team there having to had to pay a billion dollar breakup fee because Lena Khan was never going to let that, you know, sort of go through. It's like, OK, well, you know, you kind of, you know, you get this, you know, sort of fast track and, you know, don't get the, you know, sort of regulatory involvement. But forth and forth, I feel like this may be like a very short window of opportunity where like there's just no way that the FTC is not going to put something out that starts to say that like, you know, even these minority acquisitions still require some sort of like regulatory oversight above some certain transaction size.

1:18:11And so anyways, I see all this stuff is like more temporary aberration. And you're going to see controls put in both the like legal terms and term sheet regulators coming in from above. And it's sort of going to get squeezed through the middle. and I don't think that it's going to be like, you know, my brother, Pavel, for example, I think was tweeting some amount about how this like fundamentally breaks the social contract of Silicon Valley. I feel like it'll be pretty rapidly repaired in a way where you won't see that long term of outcomes where the joke is like, why be a founding engineer at a company when you can just be the founder and put in your two weeks.

1:18:43I think you'll probably see this stuff, all these edge cases sorted out pretty quickly. Well, let's move to something less controversial. Donald Trump, you're hosting an event with him, break it down. In terms of tech, it really is less, it's probably easier to talk about having a chat with Donald Trump about artificial intelligence. I got a spicy question next. So this is a layup. And it was funny because you announced the event and Wilmanitis immediately commented and was like, blah, blah, blah, blah. And John and I were both like, no, this is exactly the kind of event that Hill and Valley should do with All In and Donald Trump.

1:19:20It's like, it's incredible. It's an incredible fit. We're very excited for you and them and everyone involved, but give us the breakdown. What's actually on the agenda? Can people just DM you and get tickets? Is this even open? And then what do you hope to have come out of it? Yeah. Maybe we'll start off with a back half of the question. Obviously, the administration put out some early executive orders when they first got started talking about both winning the AI race and then showing the prosperity, economic growth and jobs that would come out of it. I think what both us and the administration are looking for coming out of this event is just, you know, there's going to be a whole set of executive orders that are signed, you know, sort of live that go into more specificity across the various areas of ensuring that we win the AI race.

1:20:08And, you know, really communicating a message that there's both a commitment from the private industry, you know, sort of players that are significant in this space, as well as from the government to really ensure that that happens. And again, from the lens of like, I do think there's been some, you know, sort of chatter about is AI going to be, you know, sort of job growth versus job destruction. And while, you know, everything from the sort of steam engine to Internet to mobile, et cetera, has always, you know, sort of done both on a net basis. It's always been, you know, sort of net obviously super positive for the economy and super positive for jobs.

1:20:38People just do different types of jobs. And so, I think making sure that that's very clearly also what's happening in AI, rather than just like the, I don't know, contra narrative of all that's going to happen here is everybody that works in customer service is going to be out of job. It's like, well, there's also going to be way more people doing data center build outs and chips returning to the United States and broader energy infrastructure that needs to get built. We've publicly announced, you know, sort of some set of the speakers, some of the bigger ones, you know, sort of Lisa Su from AMD, you know, sort of speaking on, you know, sort of chips.

1:21:12But then there's also some, you know, sort of earlier stage players that focus on everything from, you know, AI factories to data centers to energy to, you know, industrial robots powered, you know, sort of by AI. So you'll see this theme of like it is a lot more like what I call like real world or like physical, you know, sort of AI more so than some of the like traditional software platforms that are getting, you know, sort of a ton of, you know, sort of narrative in the press. And then, yeah, you know, we unfortunately, you know, don't have, you know, infinite space to have the entire broad public, you know, sort of come attend.

1:21:47And so, you know, sort of pretty, you know, sort of filled out, but it will be, you know, sort of live streamed. It's all the content, you know, sort of will be available. and we're super excited for that. And this is definitely pretty quick turnaround. We didn't have a ton of upfront notice, so thrown together. But really thrilled, obviously, to be collaborating with the online guys. I think it would have been basically impossible to obviously do this without them. And obviously, Saks, one of the besties is the AI and crypto SAR. And Mike Kratzios, I forget if his title used to be at least CTO of the United States.

1:22:20I forget what the new title is. I think it's like head of science and technology at the White House. But this is very much so, you know, sort of their, you know, sort of brainchild and their policy priorities that are really going to, you know, sort of come to light. And we're super thrilled to have, you know, sort of Hill and Valley as a, you know, sort of a co-host of this. And obviously, you know, sort of builds upon the event, you know, sort of earlier, early in the year. And I hope we're able to do more things like this in the future, irrespective of, you know, sort of who's in the administration.

1:22:43We've always tried to keep, you know, sort of Hill and Valley really, you know, sort of bipartisan. And so you'll definitely see a lot of, you know, sort of Dem, both participants, you know, in audience and, you know, Democratic leaning founders on stage. So I always want to make sure this is something where, yeah, we're sort of, you know, a forum that is sort of here to just, you know, be the meeting of minds between policy makers and sort of folks in the technology ecosystem. It should be an easy topic to keep bipartisan, I would imagine. Like it has to be one of these. I mean, obviously everything's super partisan in general.

1:23:15but artificial intelligence, like you have a ton of Democrats running labs, working at labs, but then there's a job story if you're building out a massive data center in a red state, then the red state's folks support it. So it doesn't seem like it should break down traditional party lines. I am interested to hear about what is the actual relationship between the administration and AI companies that are doing build outs. Like there was this story just yesterday. Donald Trump said 20 leading technology and energy companies are announcing more than$92 billion of investments in Pennsylvania. This is a triumphant day for the Commonwealth and the United States of America.

1:23:54Google said it'll put in$25 billion. Blackstone promised another$25 billion. Corweave's doing a$6 billion investment. You'll love to see it. Let's give it up for big business. My question is like, is this just Trump like celebrating what the free market is doing and just drawing attention to, you know, a great thing and just giving the free market like a pat on the back? or are these big companies, are the deals getting so big that there's actually like, hey, when Amazon was picking where their headquarters was, it's kind of like a debate. And is there some back and forth where the administration can actually help out on something or stimulate CapEx?

1:24:33Do you have an idea of what the shape of those discussions is like? Yeah, I also, I'm going to touch on that. I want to quickly do it, just like a go back on the bipartisan nature of some of the topics. I'll just talk about two representatives in particular on the Dem side in California that I think have been proponents of a lot of the topics that are going to be on stage. Representative Ted Lieu from California and Congressman George Whitesides from California. Ted Lieu more focused on the AI side. Whitesides more on all things aerospace, industrialization, but have been big proponents of the abundance, I think caucus is what they call it.

1:25:07talking about a lot of these topics where it's like, you know, you the way you're going to get through economic prosperity is through leaning in on technological progress. And then, hell, even Obama basically sort of came out, you know, in support of this, you know, sort of recently. Right. Saying that, like, you know, at the end of the day, our party's platform doesn't work if you can't afford housing and people refuse to sort of build it. Right. And so he came out as like, you know, clearly an extreme, you know, sort of YIMBY, which is, you know, not, you know, at least the like default, you know, Coastal Commission of California, you know, sort of position.

1:25:34So, and he's got, you know, I think the highest Democratic, you know, party approval rating. Like I saw something where it's like, he's at like 96%. And then like, I think the next best was like, Hillary Clinton at like 65. So it's like, you know, if Obama's coming out, you know, in support of this, I think it's going to be a huge momentum shift on the, you know, sort of downside, which I think is generally very good for the country where, you know, more and more of these topics become more and more bipartisan and a meeting of the minds. On the like, you know, announcements around data centers, I admit that I don't know the CapEx programs in that specific sub-industry as well, but I'll talk about two industries where I do know that the government has been leaning in on.

1:26:08One around forestry and natural resources and another one around DOD. In both of those areas, there are like net new government programs and budgets to basically provide these more like higher book to value guaranteed lending programs at lower cost of capital for companies whose projects are fitting into the policy priorities of the administration. And so that's everything from building out sort of huge, net new, re-industrialized, sort of defense-related, sort of factories and manufacturing lines. And then for folks that are building everything from sawmills, processing plants, et cetera, from natural lands or national forests, as well as on the mining side.

1:26:52And so at least there, there's literal direct program offices, line items, et cetera, that are actually influencing the capex spend and making it sort of putting their thumb on the private markets to make the cost of capital and the debt available to these companies even cheaper than maybe what the private markets could bear. Which, for what it's worth, it's like, if you look at Fannie Freddie on the consumer housing side of things, it's obviously something that the government does there for mass single-family homes below a certain price point. They obviously provide a guaranteed loan program.

1:27:25And so it's something that the government has used before to you know, sort of prop up other, you know, sort of markets. And so they're clearly doing this around these other administration priorities. I wouldn't be surprised. I mean, I haven't dug in, but I wouldn't be surprised if there's something similar in the data center, you know, an AI, you know, sort of market as well. Yeah. Quick question for you. I know we have a couple minutes left. Who wins in a bar fight, global birth rates or Grok companions? Oh, man, tough. You know, anime girls in, you know, sort of short black skirts with, you know, sort of ponytails.

1:27:59Teaching you quantum physics. Yeah, teaching you quantum physics for everyone's, you know, sort of weak spots. So, man, you know, I am wondering, like, you know, what's behind Elon's promotion of it, where it's like, do they just need a certain amount of money? Well, here's my thesis. I think it could very well become the fastest growing consumer app of all time, like legitimately. Like you combine Elon saying, I endorse this, and you're buying from an Elon company. Same. I created this company. I also created Tesla. And it's basically massively TAM doing a lot, basically TAM expansion, which is like, babe, I didn't subscribe to Grok Heavy for companions.

1:28:37I use it at work, right? I pay$300 a month because I need a long context window and I need to, you know, I need to help. I need to help. I need to help writing emails. And so I think that those factors of just like basically promoting that kind of product on a global scale, a really high price point with something that humanity will pay for. It could mean that this is a billion dollar run rate product within the next couple of years. Oh, yeah. One year. Yeah. My girlfriend's name, Grok Heavy. That's not like it doesn't sound. It sounds like a SpaceX term, like heavy from Falcon Heavy. I don't know.

1:29:15I do think you're just going to see more and more of this like AI induced psychosis where just like, you know, it tells you what you want to hear. It like, you know, perfectly, you know, has these feedback loops. You're already seeing this stuff from like, you know, some teenagers that are in. I think like there's there's a there's a Reddit thread we were looking at earlier, identifying all the words that people use once they're in sort of LLM induced psychosis. and there's like eight or so words that start coming up in that person's dialogue really rapidly that we've seen recently, like recursive, mirror, structure, these words that get used over and over.

1:29:49That's fascinating. And when you, I think people are combining them with drugs, which is insane, and then they're going down a single, basically prompting like 7 ,000 times in a row with like the same dialogue. blog, and it's easy to imagine how that would drive you insane. One last question. How do you think Jensen is doing juggling U.S. interests and China's? Well, it's interesting that Singapore somehow buys$15 billion of chips for a small island nation, I think. It's biology. Yeah, it's all biology. It's his network state is getting really, really powerful. He has great networking equipment.

1:30:32Yeah, yeah. I mean, man, I was at this fun conference up in Idaho last week, and there was various geopolitical talks, including one that included an expert from Taiwan. And it's just, you know, we are in, like, you know, by far the most, you know, physically risky, geopolitically, you know, sort of risky environment that the world has been in since the fall of the Soviet Union. sort of union. And I think it's, you know, sort of really hard to figure out how to interact in the environment when you're somebody like Jensen that has like revenue from China, significant infrastructure that you're dependent on in Eastern Taiwan, but you're based in the U.S.

1:31:10I don't envy his position. I don't envy his position. And global equity market. He's basically holding the global equity markets up like, you know. My hope is that it's a stabilizing force. My hope is that it's a stabilizing force. But Thank you so much for stopping by. We'll let you go back to your work and your lunch. We'll talk to you soon. Talk soon. Great to see you. And before we bring in our next guest, I will tell you about fin.ai, the number one AI agent for customer service, number one in performance benchmarks, number one in competitive bakeoffs, and the number one ranking on G2. You can get started at fin.ai.

1:31:42They have a free trial. So go check it out. Used by Anthropic and Monday.com. Welcome to the stream. Our next guest is Lucas. How are you doing, Lucas? Good to meet you. Lucas, what's going on? I'm doing good. This is the first pod I've been on with two guys with better hair than me. I don't know about that. You're looking sharp. You look fantastic. You came prepared. Next time, I would love a suit, but the background is a good... The background is fantastic. The background helps. This is New York City? It's not fake, believe it or not. We're at Hedge Fund HQ, 9 West 57. No way. Amazing. Beautiful.

1:32:16Break down what it means to be at Hedge Fund HQ. Talk about life at a crossover. I want to talk about the state of the markets. I want to talk about KOTU's reporting and analysis. It's a very condensed report. It's very accessible, but it still feels like it has a little bit of the deeper analysis that you don't get from some VCs. So I enjoy that. What's the overall temperature on the markets today? Yeah, I think we're still pretty optimistic, right? I think you have a really complex environment, right? The NASDAQ and the S &P got off to their worst start since NASDAQ inception in 1971 through April 18th.

1:32:57But since then, you've had a lot of good news, right? Inflation has been lower than people thought. Tariffs haven't affected inflation as much as people thought. The U.S. consumer has been really strong. Performance in companies has been really strong, I think, in the public markets, but also in the private markets, which is giving people a lot of confidence. And so I think we feel good. I think the only kind of question mark we have is, is there this delayed effect to tariffs on inflation? And what does that even mean? Right? Like, we haven't had a situation like this in 50 years, you know? So like, what is it?

1:33:29What really happens? Economists don't know. We don't know. And so predicting that is really tough. And we put up a surplus. That's an immediate effect. Yeah, that was crazy. We put up a surplus in June, which you don't see much from Uncle Sam. Free cash flow. And then the PPI came in today, a leading indicator for inflation, lower than every single economist predicted, right? I don't think you usually see. So I think it leaves a lot of room for optimism. Yeah. Did you read into the earnings season that we're going into? J.P. Morgan beat earnings. Sounds pretty bullish for the American economy.

1:34:04The Wall Street Journal said, the U.S. economy showed signs of resilience despite escalating threats of a global trade war, a sign that American corporations and the consumer are still charging ahead. You love to hear it. Jamie Dimon said, we've basically been in this soft landing now for some time period. It's been resilient. Hopefully that will continue. Is he talking about soft landing coming off of the end of ZERP or just the start of the year? What is your interpretation of Jamie Dimon's analysis of the American economy? Yeah, I think it's basically coming off of ZERP and coming off of that whole era, right?

1:34:36And I think economists were predicting and a lot of people predicted a recession for the last couple of years. And, you know, maybe we've been in a mild one for some period, but I think that's been the ultimate question. And it just kind of hasn't come to fruition the way that a lot of folks thought that a way that a lot of economists thought. So I think people, people feel pretty good, right? And I think you see a lot of confidence from the big companies, right? You, you see Meta and Zuck talking about, you know, building data centers, the size of Manhattan. And I think if we were in, you know, a negative environment where people weren't seeing gains from AI and all these wonderful things, you know, you wouldn't see that type of investment going in.

1:35:12And so I think it leaves a lot of room for optimism. And we talked a lot about this in our East meets West presentation, which you alluded to. But AI, I think, has the potential to really improve productivity. And that solves a lot of problems, right? It can solve the national debt problem, it solves the general productivity problem, it solves the GDP problem. And so if what a lot of folks believe can be true about AI, then, you know, maybe there's even more room for optimism at corporations. Yeah, what are the key lessons that we should take away from the end of the ZERP era, the rise of interest rates?

1:35:45There were some companies that were kind of revealed to be fraudulent or kind of just overvalued, but it feels like we're already in, And the lesson certainly doesn't seem never invest at 100x revenue multiple, because that's already worked out for people who have been investing in 100x revenue multiple companies for a few years and got exits because that's happened. So what are the lessons? Yeah, I think it's a few different things. I think one is quality matters is probably the number one lesson that I've pulled from the Zerp 2021 era. You guys have an amazing sponsor in a company called Ramp.

1:36:18Some people have heard of it. Very small startup, but do it very well. Like that's an example of an asset that's just incredibly high quality. And people always thought it was super expensive. People would invest it 200 times gross profit or 50 times gross profit. The reality is the best businesses compound over very long periods of time. And if you're investing in a quality business, often at really any stage, over duration you're going to be in a great spot. I think the place where folks got in a lot of trouble is being in sectors they aren't experts in, right? Reaching into different sectors that they weren't experts in.

1:36:53You know, a lot of growth investors, you know, candidly like us, you know, chasing venture rounds with growth dollars, which I think is happening again, right? We got pockets of this in different areas. And then just way too many companies, right? We were at the end of the kind of the SaaS era in many ways without AI yet. And people were funding literally everything kind of chasing yield and chasing returns. And I think there's very few companies that are very high quality. And I think that's kind of the lesson coming out of that era is you got to back those and only those. Yeah. What is we don't spend a lot of time on the East Coast, at least this year, because we're here in the studio.

1:37:32But I imagine you pick up sentiment from like traditional hedge fund managers that might even be in the same building as you guys. What is this sentiment? Are there pockets of people that are, I love the volatility, we're printing, I live for this, and then other pockets that are just maybe panikins, people that might not just enjoy the chaos of sorts. What are the different groups in your mind? Yeah, I think the biggest debate and the biggest flavor and mix that you get is just the AI doomers versus the AI optimists, right? That's the biggest mix that I think you have in the hedge fund world.

1:38:13And you see it, you know, once every three or four months, you get a deep seek moment, or you get a moment where Microsoft says they're pulling a few contracts, and the market pulls back, right? And but then you have the reverse of that. Whenever, you know, you see these incredible numbers out of companies like OpenAI, and more recently, Anthropic, and then just this amazing global use of AI, both in the consumer and now more recently, I think you see it in the anthropic numbers in the enterprise you guys have talked about this with coding and other use cases and i think that's kind of the biggest debate that's happening um inside this building and you know other buildings close by and i think it's this huge contrast between silicon valley where it's pretty much all ai optimism and the east coast where there is a there's definitely a mix of opinions interesting interesting um do they uh you find the people that are bearish just uh typically don't use any of the products they haven't haven't adopted them Because I think it's one of those things, it's hard to just be like blanket bearish if you've never experienced a magic moment using one of the products.

1:39:15Yeah, I think there's honestly, I think there's a lot of that. Right. But I also think it's people that have studied the past cycles and they see that, you know, you do have these bubbles and, you know, maybe we're in a little bit of a bubble now. There are companies, you know, raising at 10 billion plus valuations with no revenue, no product. You know, two folks in a dream. Hopefully you guys soon. But I also think there are pockets of incredible things, right? Well, yeah, even we were debating, I was having this conversation. It was like, okay, it's clear where OpenAI's revenue opportunity is, where the revenue is today, where it will be.

1:39:51It's very clear where Anthropix is. My question like a week ago was where's Grok's going to come from? Like where are we going to see an explosion? And then this week we had new contract with the DoD. And then companions, which I, I'm gonna go out and just predict I think that'll be like a billion dollar business like very quickly regardless of how people feel about it and so So yeah, and it's just there wasn't a there wasn't a lab that was willing to like go there Even though people know that that is a huge opportunity Yeah, I think I think it's super interesting and it's funny Like when I was growing up the biggest thing my mom had to worry about was like too much World of Warcraft Now you got something like this.

1:40:36But I think things like this have been incredible revenue opportunities in the past, right? You think about where people went with character AI initially, right? And the absolute skyrocketing of usage that happened there. You think about a lot of these apps that have kind of conformed in and around ChatGPT. I think there's just a huge, huge opportunity here. How are you, what's your framework for some of these new experiments around tokenized private company shares? because I imagine a large part of the CO2 portfolio is what companies like Republic and Robinhood are trying to get out there in terms of giving access to retail.

1:41:12But in general, obviously, these experiments are not sanctioned by the companies. In fact, the companies are actually coming out and saying, and there's this weird dynamic where there's always gonna be 10, 50, 100 times more demand, however much open AI shares you could get on chain there's always going to be like exceptionally more demand. And so there's if you can actually make these experiments happen, there's just going to be wild distortions. Yeah, I think actually I think there's a lot of ways you could take this. But the number one takeaway that we've had from this, and we talk a lot about it internally, because one of the missions that we've been on recently, and we have a new fund called SeaTech, which is really the idea behind it is to allow more retail investors access to our platform.

1:41:58And I think it just shows the hunger for a normal person to get access to companies like OpenAI and SpaceX and Revolut and some of these fantastic businesses that, you know, normal folks can't get access to. Right. It's this trend of companies staying private longer, not going public. It's the trend of the regulations that we have in the U.S. of people not being able to access these types of names, where I think it just shows there's a real hunger for this. Right. People are so excited to own OpenAI. They're so excited to own SpaceX. and there's no way to do it today. And I think it's going to be something that, you know, the U.S.

1:42:32is going to have to grapple with and companies are going to have to grapple with because people have this insatiable demand for their stock. Yeah, one crazy update I had to my understanding of the value of staying private longer was this past weekend where Cognition wound up acquiring Windsurf and it felt like there were a lot of other things going on, but one big one was that if the whole company, Windsurf, had gone to Google, that would have been crazy FTC review. But small, medium-sized, I mean, huge, Cognition's a fantastic business, but it is a small company in the eyes of the FTC. It's a private company.

1:43:09It's a young company. Buying another small, young company, all of a sudden, much easier to put those two pieces together. So that's kind of like an untapped, the ability to move faster on the acquisition side, potentially an underrated benefit of staying private longer. But are there any other factors that might be driving the decision to go public or private or stay private longer in your mind? Yeah, I think there are a couple others. I think the most simple one is people want to invest really heavily. And there is this perception that the public markets only rewards profitability and not growth, which we actually think is not true.

1:43:44Sure. But it is certainly a perception. And I think folks that want to invest and be unprofitable and really invest over a five, 10-year basis into product or R &D or sales and grow really quickly, it's hard to be a public company that way. It really is because public market investors can be fickle. You have to report every quarter. It's harder to take a long-term mindset. And so when you're still in that investment mode, a lot of folks want to stay private longer. And it is a benefit to not have to think on a quarterly basis the way the public company does. Yeah. I want to know about the East meets West, like kind of mental model around the AI salaries.

1:44:23The hundred million dollar research offers are going mega viral in Silicon Valley. It's just grabbed everyone's attention. And the new plays that you know, reverse. Yes. Now companies realize that's a card you can play. But everyone keeps drawing on the analogy of sports, but there's It's also the analogy of Wall Street, where top traders at Citadel apparently have pulled in a billion dollar bonus. And Greg Abel famously made more money at Berkshire Hathaway on salary than Warren Buffett did for a long time. And so this idea that the CEO should necessarily be the salary cap for the organization has not been true on Wall Street.

1:45:04And now it seems to not be true in the AI world, in tech. But what has your reaction or your world's reaction been to the crazy trade deals, the AI salaries? Yeah, I loved the Uno reverse yesterday. I thought it was hilarious. Incredible. I think it's kind of interesting because we've seen this here, right? You saw it, I think, actually in growth investing in 2020 and 2021, right? A lot of careers were yanked forward and a lot of salaries were yanked forward. You saw it in the hedge fund world and you still do with the rise of pods. Right. Just like you're referring to. And I think this happens every time there's just a big imbalance between labor supply and labor demand.

1:45:44Right. When there's an emerging sector, an emerging market, an emerging trend, and there are very few people that can do something really well, the market just rewards that incredibly disproportionately. And I think you see that in athletics all the time. You see it in the hedge fund world. You see it in the VC world. You see it everywhere. And now we're seeing it with AI researchers. There are just so few of these people in the world. I mean we're talking on the order of hundreds that people really want at the end of the day and Dozens of companies that have incredible balance sheets. This war is gonna happen.

1:46:13I think it's gonna get it's gonna get more intense Yeah, I want to talk about Competition specifically we were talking earlier. There's been a bunch of examples of this the question of like if you're a chat GPT Rapper is chat GPT gonna is open AI gonna steamroll you we have a buddy of the show who who runs a company, an enterprise SaaS product essentially, and AWS just launched a competitor. And I'm wondering how much weight do you put in the bucket of just the grit and the determination of the founder can overcome a challenge from a massive company where they have 20 startups that they're competing with, and if you stick with it, you can break through, versus there are fundamental market forces that could have been understood in an investment memo at the seed stage to know that it was not good to go up against this particular hyperscaler, this particular growth stage startup?

1:47:07How do you think about competition when an entrepreneur is in the various parts of the journey? Yeah, I think this is a super interesting question. And again, I think it's actually one of the other differences between Silicon Valley and the hedge fund world. And I see this a lot because I straddle it where I remember two years ago, whenever we were first thinking about, all right, how does AI impact the public and private markets? We're like, oh, well, of course, the public market companies are all just going to latch onto AI and they're going to dominate this. And you fast forward two years and certainly NVIDIA has been the case and some of the cloud providers in certain areas, but the application software companies haven't really done anything with AI, right?

1:47:48Like people are like, oh, CRM, they're going to kill it, you know, all this stuff. It hasn't really been the case yet, which is kind of crazy. And you contrast that with, look at what's happened in the private markets with new companies and incredible CEOs, Cursor, Cognition, Harvey, Glean, Open Evidence. You talk about all these companies that have come up that are competing with these huge companies and killing it. And I think it does, at the end of the day, there are certain businesses, if you have a network effect, it's hard to break into that. But even you see OpenAI versus Google, right?

1:48:19I think it's just a lot of this does come down to like the grid of the teams being able to go 996. All this stuff matters a great deal more than just some incumbency advantage. How are you thinking about stable coins? Everybody's excited about them. Everybody wants to make money on them. It's hard to make money on them by holding them, especially with the new regulation. I put all my money in stable coins and my portfolio is flat. It's flat on the year. It didn't go down though. But it's Such an interesting category because it seems, I shouldn't say incredibly easy, but quite easy for existing financial players to add stable coins to their product.

1:48:58So if you're a bank and you want to enable a company, your user to hold, send, buy, swap stable coins, not super difficult. Circle is public. There was a massive amount of interest. But, you know, personally, I look I look at stable, you know, Circle trading at whatever their current P.E. ratio. It, you know, it's talk about an expensive company right now. So how are you guys thinking about the category? Are you looking to place new bets or do you think it's more of a feature to potentially existing bets? Yeah, I think, well, one, we're paying a ton of attention to it. And our view is this seems like the second big use case of crypto, right?

1:49:43Really being able to, if Bitcoin was the first, as this, call it a store of value, call it whatever you want to call it, digital gold, then stable coins really do feel like the second really big global use case. We are trying to figure out actively how to play this, right? You talk to the folks at Stripe, they're trying to figure this out. They made what I think is a killer acquisition with Bridge. Bridge. You talk to Ramp, they're trying to figure it out, right? There's a big opportunity for Ramp internationally here, I think, to be able to really move money. We're really excited about it. We're trying to figure out the right way to play it.

1:50:13We haven't seen a ton of new companies come up, but a lot of the more innovative, slightly bigger companies like Stripe, I think, are going to really be able to take advantage of this. Yeah, it's hard because you're excited about a broader trend. You want to deploy capital against it. And then you look at your portfolio and you're like, wait, you're really well positioned here. You're really well positioned here. Sometimes the answer, as usual, is you just buy more Stripe. Buy more Stripe. That's funny. How are you thinking about robotics from the lens of a growth investor? There's some bright spots, areas where there's real traction, but then some of the hottest categories feel 10 years out.

1:50:52And as a growth investor, you're being asked, if I invest$200 million today, is there going to be someone else in two years that's going to come in and write an even bigger check? So I'm curious how you're thinking about that category. Yeah, this is a space we've talked a lot about. And obviously, we're really excited about it. We have an investment out of our venture fund in a company called Skilled, which you all may be aware of. If you haven't, you should go see them and see the products. it's pretty killer the advancements that they're making spin out of Carnegie Mellon out in Pittsburgh. I think from a growth investor's lens, this is like one of the hardest things, right?

1:51:30Our view and our mandate on growth investing is we invest in businesses that have real business models and that are clear or emerging leaders in their categories. And in robotics, we're still too early for that. That's just the reality. And our view is generally you want to be in the leader because the vast majority of the gain accrues to that number one player, almost always in technology. Some exceptions, but almost always. And so it's better for us as a growth investor to just wait a little bit longer and be a little bit patient. But our view is it's coming. The question is how long? I do think there is one exception in this market on the incumbency bit, which is you have Tesla and you have Elon.

1:52:12And in the robotics world, it's hard to bet against him, I think, in a lot of ways. Right. Like he's got the power of XAI underneath him, doing all the research. He's got Tesla. He's got all the real world data that exists out there. He's got SpaceX, all these things kind of mixed together. And he's a founder. And so it's kind of hard to bet against him in that landscape where it seems really compelling. Yeah. Tyler Cowen has this take on AGI. He says, AGI is here, but the impact will be slow because so much of our economy is healthcare, and it's nurses in the hospital, doctors doing physical things that can't just immediately be replaced with an LLM.

1:52:53And so you'll see a slight boost. Or somebody paying rent. Yeah, and there's all these different pieces of the economy that might not be disrupted by LLMs. They might be disrupted by AGI, super intelligence, robotics, future. but how are you thinking about like the surface area of AI's impact you mentioned Harvey and legal and Glean it feels like we're starting to map out a few of the different subcategories that could be rich pockets of value but are there any that you think are kind of underrated or might be next up or or or where or like do you or do you agree with just Tyler Cowen's like general thesis on you know AI as an advancing force or sustaining innovation in the stuff that has already been brought online essentially.

1:53:43Yeah I think I pretty much identify with that. I think there is something pretty interesting right which is in technology again you almost always see the consumer first right you saw it in messaging you saw it in mobile you see it in everything the consumer adopts really quickly first and we've seen that now there was the chat GPT moment where two years out from that, the consumer is adopting AI. Enterprise takes a long time. And getting it in the hands of people at work, like lawyers, doctors, you know, even developers to a certain extent, but not so much in this case, you know, it takes a long time.

1:54:19Fundamentally, people are sticky. Enterprises are sticky. Processes are sticky. And so it takes a long time to get things really implemented. And I think that's kind of what we're seeing, right? You've got a couple of early use cases, coding is by far the most obvious. We think it's the vast majority of the value that's being accrued in the enterprise today, right? There was 1.3 billion in coding ARR added in the last 12 months outside of Anthropic, just in startups. And so you're seeing it there first, but I think you're also seeing pockets, right? Legal, Harvey, open evidence, medicine, glean, search, right?

1:54:52You're starting to see it, especially in the text in, text out type use cases, but I think it's going to take time. Yeah, it is crazy thinking about like, I bet if you looked at consumers adopting like file transfer versus airdrop is probably higher than, or like roughly the same as like in a hospital, are they sending more faxes? Like the fax has been sticky in healthcare for, and at home we're like using like the next, next, next generation. Yeah. So like all of a sudden, are we all going to wake up and build our own CRMs? Probably not. No. Right. We are still using fax machines. Yep. Totally.

1:55:29I think these things, they take decades. Yeah. What are you tracking on the CapEx side for the AI build out? I've been reading semi-analysis a lot. There's this new big push in Pennsylvania, something like$92 billion going in there from Google, Blackstone, CoreWeave's doing stuff. We talked to the co-founder of CoreWeave. He was saying that the capital markets aren't necessarily even ready to absorb the amount of demand that are there. Talking about just like when you talk to the AI folks in Silicon Valley who are more like on the philosophy side, they're like, well, of course, we'll build a 10 gigawatt data center next year.

1:56:08And when you talk to the finance guys, they're like, wait, you want$500 billion to do this? Like, no. Texas? You'd like Texas to be next year. Exactly. But yeah, what are you tracking on the AI CapEx side? What are the interesting stories? What are the interesting threads that you're pulling on over there? Either data points or just narratives or different market structures that you've kind of identified? Yeah, I think the biggest thing that we continue to follow and we continue to hear is just that everyone is compute constrained. Right. Like all these build outs that are happening for the last couple of years.

1:56:42And again, this is a big West Coast, East Coast debate again and has been about just like capacity and like, are we overbuilding and all of these things? And I mean, you even saw with Microsoft, right? It's caused some of the friction between Microsoft and OpenAI very publicly is about compute build out and OpenAI not having access to enough compute. Right. And so I think that's just what you're hearing. And I think that's the most interesting thing that's happening right now is, you know, Anthropics compute constraint, OpenAI's compute constraint. They can't release new products because they can't serve them.

1:57:13Right. And so I think you're just going to continue to see this build out happen. And I think we are really we are really bullish on that trend. I mean, we're we're heavy investors in in CoreWeave. We did a lot with them before the IPO. And I think it's just been an incredible story so far, right? And I don't think you've seen an end to the demand yet. Last question for me. What are you looking for in the autonomous vehicle market over the next one to two years? We've got two key players in the race. Obviously, Tesla won. They have an interesting map of their operational area down in Austin. and then Waymo, of course.

1:57:59There's also horses. Traditional horses. It's autonomous. And there's also Pony AI, I guess. That's actually one. But it's such an interesting dynamic because when you have this very CapEx light model and then you have the polar opposite and it'll be an interesting battle from our view. But I'm curious if you have a read. I mean, the thing I'm most looking forward to is just being able to use Waymo everywhere. But yeah, we're all ready for it. I think the consumer demand is obviously there. I think the biggest dynamic that's going to be interesting that the public market is paying attention to is actually what happens with Uber and like the existing networks.

1:58:37And how does that end up playing with all these different providers that are emerging with, you know, Tesla, which is trying to build its own network, Waymo, which has built its own network. What happens to Uber in this world? And I think everybody there's a bull case and there's a bear case on this. And I think everybody's trying to figure it out. But it's clear that the unit economics on this stuff work for Waymo already. And whenever we move from Jaguars to something else, eventually it'll probably even get a lot better. But it's going to be a really exciting battle. And then the second and third order effects of, OK, if people are getting two hours a day of their time back, what are they going to do with it?

1:59:11Probably scroll on apps, which would be good for Zuck. Or they'll do more email. Different beneficiaries. Wimos should move to Paganis. Pagani Wairos. They're hand-built. It might affect the economics. But it is quality. And it would be differentiating. Apparently, they're talking about a deal with Toyota. So we might see some Supras. That only makes a little more sense. Yeah. But this is fantastic. I really had a blast talking to you. Thanks so much for huffing on. Thanks for coming on. We'll talk to you soon. Talk soon, Lucas. Bye. Cheers. I'll be right back. Really quickly, Let me tell you about public.com investing for those who take it seriously.

1:59:53They got multi-asset investing, industry-leading yields. They're trusted by millions, folks. You can get started at public.com. And let me also tell you about out-of-home advertising made easy and measurable. That's adquick.com. We're at baby. Say goodbye to the headaches of out-of-home advertising. Only adquick combines technology, out-of-home expertise, and data to enable efficient, seamless ad buying across the globe. Our next guest is Ravi Gupta from Sequoia Capital. Welcome to the stream, Ravi. How are you doing? I'm so glad we were able to get some sleep. I hope you slept well I was about to stay up all night debating you but I said I'm gonna stop texting him because he's coming on the stream We can have the debate live.

2:00:31How are you doing? Are we even on different sides of the debate man? I just feel like we might be we might even be agreeing Although I forgot my blazer. You guys are looking good. Yeah, no, no, no, no, it's all good But first I have to ask you explain to me who is LeVar Ball? By the way, I do. Maybe you guys can flash up the tweets because I don't have a lot of banger tweets, but this one was one where I wanted to email Elon if I had his email address and just kind of be like, I think the algo is broken. LeVar Ball is, I tweeted that I want to become the LeVar Ball of AI researchers. And LeVar Ball is the father of three NBA players or two NBA players and another one.

2:01:12He has three sons, you know uh lonzo lamello and liangelo and he's been very famous about like trying to make them into nba players from birth and he's a very he's kind of a blowhard and i have three sons and with some of these pay packages that are going out for the ai researchers i said you know why would you mess around trying to make them nba players like look their genetics might lean a little bit more towards becoming ai researchers so i think the best thing my wife and i can do would be for me to become the LeVar ball of AI researchers. And I tweeted this thing thinking that I'm going to get virality.

2:01:47TBPN is going to be talking about it. And I got like 13 likes and it was pretty painful. We did put it on the show. I think you might have just underrated the fact that tech loves the aesthetics of sports, but no one in tech actually understands sports. No, here's the thing. Here's the thing. The Hays paradox, which I created, which is the idea that the more funny that you think something is, the less likely it is to go viral. Because the thing that's going to be most funny to you is like super niche and just entirely dependent on what you find fascinating and interesting. But that doesn't mean that the entire public will also.

2:02:26I think the Hayes paradox is true. I was so disappointed. I posted something that was like a very obscure reference to the fact that like Ben Thompson was on vacation this particular week. And it just completely flopped. Because people broadly are not tracking Ben Thompson's vacation schedule like I am. No, John, listen. I think it might be that the algo was broken for both of you. Yeah, yeah. Let's leave it there. Let's leave it there. Occam's razor, it's the algo. Yes, yes. We're built different. It's not us. It's you. It's the algorithm. But let's actually talk more seriously about what the LeVar Ball of AI researchers would actually look like.

2:03:09Because we were talking about, so there's these crazy trade deals that are happening,$100 million offers. Are we going to see recruiters that can actually bring these people in the door get crazy salaries? Is that the next wave that we're going to see? Are we going to see a recruiter go to a Mag7 company and get$10 million or something? It just feels like it's founder mode. Beep, beep, beep, beep, beep. Yeah, feels like it's founder mode. And then the question I had for you was that, you know who's really good at spotting AI researcher talent? Venture capitalists. So are the venture capitalists going to get poached?

2:03:43And they're going to say, hey, yeah, you're making a lot of money as a GP at a tier one venture firm, but you want to come over to Meta and start doing recruiting and just bring these folks right in here. We can pay them out like it's a liquidity event on day one. So how does this all shape out? I think that I don't know how the recruiter takes shapes out. I guess my perspective on this is like I think that high performing people in Silicon Valley have probably been underpaid relative to their performance because of things like comp bands for a long time. And I think that if you think about it, you know, comp bands imply that everyone within a certain level is producing within some range, right?

2:04:23You know, maybe one to two X of each other. And I think anyone who's ever worked in a business knows that like, that's just not true. Like there are people that are, that you would do anything to keep within a level. And then there's other people that's like, okay, if they left, like, you know, we'll deal with it. And so I actually think that the high performers have been mistreated for a long time. So I'm actually quite happy with this idea of like if you are really uniquely good, I'm talking like truly otherworldly good, you should get paid like you're otherworldly good. And I think that one of the things you and I were talking about last night, John, that I think is also relevant is like these aren't guaranteed contracts.

2:04:59They're investing every month. if someone if you think someone is life-changingly good and they turn out not to be life-changingly good they don't have to work there anymore and you don't have to pay them anymore and so i actually think that like i think that to me the big thing that you actually people have comp bands because they want harmony and they don't want to explain to somebody that somebody else is performing better if you're gonna do this i think all you have to be willing to do to the other person who's not getting paid like that is like look i might be wrong but you're not producing like the hundred million player and you might think you are but you got to make it more obvious because we're going to have a few hundred million dollar players and those hundred million dollar players are changing the entire trajectory of what we're doing but yeah like you know what there's money in the banana stand if you want to go and produce like a hundred million dollar player i guess my one thought on the lavar ball analogy is like a big question we've been kind of debating is will these same types of offers exist in five years, 10 years?

2:05:58Will they exist in a year? Is this this momentary blip? It's like LeVar Ball had his sons and LeVar Ball played basketball. I don't think he played in the NBA, but he knew that in 18 years, he wanted to be watching his sons play in the NBA and he knew it'd be a pretty good job. I think the big question now is, you know, how sustainable is it for top talent to be, you know, We've always joked on the show that Tim Cook has felt underpaid, right? Running the most important consumer tech company in the world, making less than, you know, or making about the same as Otani, who's hitting a baseball, which is important and good.

2:06:38It's around$75 million a year for Tim Cook's salary. And one tariff negotiation going correctly is a$200 billion proposition on market cap easily. Like no one debates that, that if he has a good conversation with the president, he can save the company from losing 200 billion or add 200 billion in a quarter like pretty easily because he's from such a high base. It's a multi trillion dollar company. Yeah. So, Jordy, I guess to your question, I don't know on the AI researcher side if this will still be the case in five years. I think that input to it is sort of like you believe that one of these people can change the trajectory of your company.

2:07:16Right. Even on like a scaled company. Right. And I think that or they can make your investment in the CapEx, you know, that you're doing on the GPU side that you can make that more valuable. I think I don't know if that will exist in five years. What I do believe will exist in five years is there will be somebody or a set of people that you believe can change the trajectory of your big company. And those people are going to get paid a ton of money. And I think that this is actually a good thing on that dimension, which is making it more normal that excellence gets rewarded. And I think that those of us who played sports in any form or fashion, when someone's playing more than you or getting paid more than you, in the case of your professional, your reaction is not like, that's not fair.

2:07:54It's like, I need to play better. And I think that this, to me, if it normalizes sort of like excellence gets paid, that's great. But I think to your point, the real LeVar Ball move for me would be figuring out what the industry would be for my kids to go and enter in that will be getting these kinds of paychecks five or 10 years from now. And like, AI is not a bad bet, but maybe it's robotics. Yeah, no, no. Yeah, the other thing that's interesting is like one of the major promises of the industry is that eventually the AI agents themselves will get so good at AI research that that and they'll just copy and paste themselves, you know, billions of times.

2:08:28And then we won't even need humans. So it's like it's almost a call option on that future of like if you really just need to build the AI researcher, how much would you pay for an AI researcher that could build an AI researcher that you could copy and paste infinitely? The smartest person in our house is my wife. And I did make a pitch to her of like, hey, listen, why don't we think about you abandoning your medical practice and just go all in next 18 months, become like a baller AI researcher and try to get one of these packages. And she kind of looked at me like I was not as intelligent as some of the AI researchers.

2:09:00But I thought that was a good idea. Yeah, it's hilarious. I want to tussle a little bit more with the comparison and actually how comp works as a founder versus an AI researcher versus an NBA player. Because NBA players have these locked contracts where even if they underperform, they might be still getting$10 million a year. If they overperform, they might be underpaid for a little bit, but then they can enter a free agency, renegotiate. to renegotiate, even if they, and then there is some variability on top with like the signing, like the sponsorship deals. So you might be underpaid, but monetizing very well with a Nike shoe deal, for example.

2:09:38On the founder side, it's kind of like feast or famine, but you have this uncapped upside. With the AI researchers, you have, yeah, you have the ability to like get fired, but you don't have as much of a clear signal on the impact. Or maybe I'm misunderstanding that, But if I think about there is there they're going to be what like 50 50 key players on the super intelligence team at Meta This is a tens of thousands of employees trillions of dollars in market cap Like it's very hard to say this researcher move the market cap this much They justified that hundred million dollars as opposed to if you hit the winning three-pointer It's very clear you won the game and we can look at your stats specifically in your contribution You can do Moneyball very easily.

2:10:24And in the founder seat, you know, it's like, yeah, you hired the key people. You got the sales contract. You raised the next round. You added, you took the company from$100 million in, you know, Series A post to a billion dollar unicorn. You should get all that credit and you should get that financial upside. And so it feels like it's a little bit squishier. But do you think that there will be more Moneyball applied to this? Do you think that we'll just see kind of massive churn based on vibes like, hey, you came in a couple months, didn't do anything that crazy? Or there will be more like internal politics to make sure you're justifying that massive salary once you get in.

2:11:01And then last question is kind of like the idea of gelling these teams. You know, the example we heard previously was like LeBron went to the Heat. They had the dream team. Still took him a year. This was Tyler Cowen. Yeah, Tyler Cowen. Didn't know that he was a basketball buff. Yeah, yeah. He could have been saying that. Yeah, I know. You got to put a side by side next time. Yeah. So, yeah, just all that. And I would just chime in and say, like, I look at it as he acquired a team. He didn't acquire any one individual player. And so you're really measuring, hey, I spent X number of billions. What am I getting from that versus micromanaging in the short term?

2:11:37It's three months in. Oh, what have you done so far? That's a good question to ask, but not necessarily like you're getting the team to deliver the thing that you want, which is maybe unclear but yeah i i think so by the way i will tell you i think this is like my dream come true of the idea of like chatting with uh some new friends about like the mix of technology and basketball and you know a little bit of like compensation thrown in like this is um but i simulation this is the best it's the best i think that okay so i actually think jordy i agree with you i think that the way this is going to go down for these companies and let's just use meta as an example.

2:12:13I think they're gonna look at their aggregate investment in, you know, CapEx, as well as in people, and they're going to have some absolute goal of like, are we one of the leading players in reaching super intelligence or not? And I actually think that the people cost of that are much, much, much smaller than the CapEx cost. And I think that, but I think that overall, it ought to be judged as like a team, which is like, are we going, did they become, did they enter the race? Are they, you know, one of the leaders in the race? And then I think within that, I suspect that, you know, Alex Wang, Nat Friedman, some of these other folks that are going to be leading this lab, I suspect that they'll do normal managerial stuff of like, are we actually getting the most out of each of these people?

2:12:53I do think that it's way easier to figure that out with 50 people than there is with, you know, a thousand people or, you know, 5 ,000 people. And I actually think that this idea of like Dunbar's number is really really appropriate here. You know, below 150 people is just like such a different management challenge than above 150 people because everyone knows what everyone else is doing. And there's some element of like game recognizes game, you know, of like do the other people on the research team think the other people are carrying their weight? And so I actually think it's quite smart that the teams are 30 to 40 to 50 people.

2:13:26and I think the core research team at each of these places is smaller than people tend to realize and so I think it is more clear you know who is doing great work and who's not so I actually think in this case it actually is a little bit more like a sports team I mean you think about it like the size of you know the team that is talking about assembling is like smaller than an NFL football team you know like you kind of know who's playing and who's not within that it is it is another interesting thing that i think is actually healthy is like you shouldn't need to quit your job to make a billion dollars like there's been this thing in the valley which is like you can you can have a great life working at a big important company but if you want to be a billionaire you're gonna have to like quit your job and go start a company that's like basically the default pathway outside of some key executive positions and i do think it'd be the the sports comp is like lebron like you're super talented, like we value you, but if you want to achieve what you want to do on the compensation side, go set up your own team and just build an organization from scratch.

2:14:31And LeBron might say, well, I don't actually want to, I actually like doing this one thing. I just want to do this one thing well, which is play basketball. I don't want to deal with, you know, finding a stadium and, you know, investors and all these other things. So I I actually think it's healthy that people can achieve. John's got a joke ready. You can tell by the look on his face. He's got a joke ready. I don't have a joke. I have an interesting similar anecdote. We keep going back to Tim Cook and being underpaid at$75 million. But I think Andy Jassy might be a more extreme scenario to kind of tussle with here.

2:15:08So Andy Jassy joined Amazon in 1997 as a marketing manager. He was named CEO in 2021, granted a 10-year equity package valued at$212 million. He's making about$40 million a year now. But he is widely considered as the reason AWS exists. So he created, in many ways,$200,$500 billion of market cap, like hundreds of billions of dollars of market cap, and hasn't really captured that in the right way. I mean, he's done fabulously. He's lauded as a great CEO. I love him. We all love him. But the question is like, is there some world where you can have an employee who comes in as a marketing manager, sticks with you, doesn't need to do the round trip?

2:16:02I've talked to some people who work at big tech companies and they say often like, if I want to get promoted, I need to leave and then come back. And I'm like, that feels like a market failure. It feels like there should have been a way. Or, you know, Google had a bunch of early employees. Paul Buchheit creates Gmail. Like, can he get a couple extra points? Because that drove so much more. But, like, the structure of these companies just doesn't really allow for that. And I don't know if that's good or bad. I mean, it all works out. Well, I think to your point, look, I think if everyone kind of gets the same thing, then it gets distributed to people that didn't create Gmail also.

2:16:39I would presume that there are some people at Google who were early who did not contribute that much who kind of just like benefited from the largesse, you know, and that's effectively Paul Buckeye like paying them some of the money he should have gotten, you know. And so I think that like, you know, look, I think people I am interested to see how this ends up playing out over the next few years of like, does this power law start to apply more frequently? OK, you know, does every company start to think about the 20 to 30 people inside of the company that they're like, oh, my gosh, what would I do if they left?

2:17:11That would be terrible. Right. And make sure that they're paid super differentially. You know, does that start to happen? I think that the thing that to your point, though, John, that's interesting is I'll give you an example for me. You know, when I was at KKR a long time ago, I think that I was actually pretty wrong on the value I was creating relative to the value the platform created. I think the value the platform created was actually a lot more than the value I created. And I think it actually took me leaving to realize how valuable the platform was. And so I think on some of these, there are people that actually probably have been overpaid because the platform that they were a part of is what created the value rather than them.

2:17:47And then there's people that are dramatically underpaid. I think one of the big lessons for me is like the range is probably pretty wide of like There are people that these places that have been dramatically underpaid Even if they've made a lot and there's other people that have been dramatically overpaid, you know Even if they made a little less and Hopefully the market that ends up getting created over time is that people are paid more like in line with their unique contributions Relative to the platform. Yeah, that that that is a great take and that that that makes sense What do you think the recent kind of zombie aqua hires done?

2:18:19does to the earlier stage venture market. If I had to concoct a strategy that feels like it could not fail, it would be to try and write pre-seed checks into just everyone with amazing AI research papers on their resume and super high IQ teams because every lab is just going to hoover up all these call options at some point and I just have such a floor to my investment that even if the product doesn't work, I'm going to do great. Is that reasonable? Is this distorting the VC market? John's strategy, spray and pray. No, no, no, it's not spray and pray. It is select for a very different criteria than traditional venture capital, which is what is the market?

2:19:07I don't care if you can build a product. Who cares about the product? Don't even tell me. Tell me tell me your resume and and have you been getting calls from Mark Zuckerberg? Because if you have got you I'll get it I'll get it at 10 million pre or something who knows. I don't even know that's good luck getting no no I get it I get it I think maybe there was a conversation for the landscape and there's a conversation from Sequoia like sure I think at Sequoia It's pretty straightforward like you know people want to help Founders build incredible companies right like that is the reason people are here the mission statement is you know we help the daring build legendary companies it doesn't it just like doesn't compute to try and like do it another way and i'll tell you like just truly there's like this real currency it's like we have like do you have an investment that's gone up on the wall of like the main conference room and like it's not going up on the wall if you sort of did it the other way you know what i'm saying and i think that uh so i think culture stuff matters a lot there i actually think what you're saying though like will happen i think people will try to figure out like every gap in venture gets closed so quickly, right?

2:20:06Because it's intensely competitive. And there are really good people going after these things. So I think that exactly what you just said is going to be written down by some young person right now. They're going to go and mobilize against it. They're going to create some sort of ranking system of how many likelihood of being acquired, aqua hired. And I think that that'll get pushed out and those prices will move from whatever the number is now for companies like that to hire. I do think though, at seed, my impression, and I spend most of my time in growth is that like, I do think that people are actually far more important than the idea because people move around a lot on their ideas anyway.

2:20:42And so I think the thing you're suggesting is acquire ability rather than just like the reason people matter right now in seed is this idea of like, are you going to stick with it and build something and figure, take in the data and figure out something amazing. I think your point is there might be another metric that people look at on like acquire ability and I suspect that'll happen it won't happen at Sequoia but it'll happen somewhere what's the criteria for the wall again because I have a strategy I'm gonna join Sequoia as an associate rip 500k into secondary buying up Figma right before the IPO put me on that wall I got a company this is a good question investor is not on the wall that would be meaningless it's just my face it's just ravi's face massive it is the company name on the wall so you know you'd be associated with bigma but but i think folks would know that dylan and the team deserve the credit and andrew made the investment in first place but but you i don't know you have a big media platform so you might be able to go out and kind of take the credit for it at some point yeah you should take who knows that guy john take credit you know yeah I think Andrew was on TVPN and sort of looked like he might be an AI himself, right?

2:21:52With that blue background, if I recall correctly. Yes, he was verticalizing blue that day. He was blue on blue. Switching gears slightly, there's all this excitement and potential around consumer agents. And when they talk about agents, they say, you're going to be chatting with an agent. You're going to say, go get me groceries or book me a car, book me a flight, book me a hotel. And then when you think about what a human would do to do those things today, they might go to Instacart. They might browse around. They might see some ads. They might go to Uber and browse around, see some ads. They might go somewhere else and see ads.

2:22:29And in a world where agents are sort of browsing and sort of doing the things that a human would traditionally do, there's been this question that a lot of people have brought up around, a lot of platforms have a lot of meaningful amount of revenue coming from advertising and then an equally meaningful or potentially more meaningful amount of their actual profit. Given that you were at Instacart, how are you imagining the agent market playing out in this sort of economic model for the internet broadly in a world of agents? Yeah. Well, so I think that it's a good question. I think the most pronounced use of agents today, I would suspect, is in customer experience.

2:23:12And so let me come back to the consumer side in a second. But I think I'm on the board of Sierra, which is Brett Taylor and Clay Bevor's company. And I think you see it already of the resolution rate that they have at Sierra for the customers that they serve is incredible. And so you already have people, human beings, interacting with agents to solve their problems and to solve more complicated problems than they've otherwise had. and to do it honestly like at any time of night and with no wait time. So I think that the promise of agents is quite amazing. And I think you can actually already see it in certain things.

2:23:44So that's cool. I think to your question on sort of like what happens in the consumer world and what happens to advertising, the honest answer is I don't know, right? I think that the thing that I find to be most compelling is a little bit of what I think Andre Carapathy said on X at some point, which is sort of like the internet right now is built for humans and over time it'll be built for agents. And I think that as that happens, I do think that there will be new ad units, new ad models. And I don't think I know what those are going to be yet. But I think that there will be a complete rewriting of like how how is Instacart or other consumer apps written?

2:24:19Because they will need to appeal to two different audiences. One is agents, one is humans. And I just don't know that the rate of change on that and how it will happen. I do think that, you know, today on grocery shopping, for instance, a very high percentage of grocery shopping still happens like not even online. It happens offline in the store. Right. It happens like the way advertising happens in a store is like end caps and side caps, you know, and then you have online. It happens and it's much more dynamic and you'll have for agents. So I just think there'll be like three different approaches to add, some of which is like offline, some of which is online to humans and some of which is the agents.

2:24:56But over time, Jordy, I think that the entire way the Internet's written will be changed and written for agents. But I don't know that I have a great prediction on how that will work other than it'll be way more dynamic. If you imagine like right now in the store, the end caps and side caps don't change. But for every week, the ads on Instacart change very frequently. The ads for agents, the ads on Instacart for humans change very frequently. The ads for agents, I would presume, are like incredibly dynamic, changing by the minute or something. Yeah. Yeah. It's also interesting. Maybe, maybe it doesn't look dramatically different.

2:25:28Maybe companies just have to pay more attention to supporting their APIs and it just looks very similar to how it's looked the last. Well, the other thing is, I think this is where like this interpretability is a big deal. Just like knowing why an agent is doing what it's doing. I actually, one of my favorite things when I use the AI tools is just to like click on the details portion and to see what it's actually doing. You know what I'm saying? Like, um, I, I love seeing that. I I love seeing why it's doing what it's doing, how it's getting to the answer that it's getting to. And I think that companies will need to get really good at understanding why an agent's doing what it's doing.

2:26:04I think that's actually probably one of the most practical changes that will happen, is there will be real teams at companies trying to discern why an agent is going through the behavior that it's going through and will build its products according. I have a question about just like the broader economic climate and how Sequoia, what the process is to take a temperature check on the health of the broad economy. Like the 2008 famous RIP Good Times memo, fantastically deep with economic analysis and looking at credit rate defaults on consumer credit cards and loans and stuff. Last week we were kind of like, oh, there's too many top signals.

2:26:55Then we just had Lucas from CO2 on. The East meets West conference was extremely bullish. And then JP Morgan just beat earnings. the health of the American economy seems undefeated, but I'm less interested in, you know, are you bullish or bearish? Yeah, for context, we put together a list of like 15 or 20 different things. Most of them were like funny. That were kind of funny. NFT profile pictures coming back or something. Oh, yeah, yeah. All these random things. But I guess my question is like, what is the temperature checking function look like at Sequoia? What do you actually, like how often do you do this?

2:27:31How do you think about it? How do you actually build a thesis and how does that relate to like the venture strategy? Yeah, great question. Look, I think RIP Good Times, which as you noted, 2008, like I think is notable because it's rare, right? It is very rare that I think we have like a macro view that is worth sharing with a bunch of companies that we're lucky enough to work with. I think the reason that that's relevant is like we're not macro investors, right? We make our returns by like investing in great companies, kind of independent of the time that they're created. like you know it's it's like a trope but it's discussed all the time like i think you know google was started during like 1999 and 1999 is often discussed as like a bad period for venture so i think that one of the big things that happens for us is like hey whatever you think is going on in the outside world go meet the best companies go meet the most interesting people don't let the macro stop you from going and doing your job at the early stage you see what i'm saying i actually think that's like a huge deal now i do think john we tend we try to be like financially oriented and we try to think about like how far ahead are we paying right and i think that the the thing that the mechanism for that is like we do try to like look at where multiples are over some period of time where are we how hot are they and just to understand like you know are we paying three years ahead are we paying four years ahead are we paying two years ahead what are we doing i think the thing that I would tell you is it always comes back to company quality because effectively, like the faster the growth, the more you believe in a future that looks super different than today, the less the multiple matters.

2:29:04You know what I'm saying? Because ultimately what you're betting on is this big future. And so I think that what we focus a lot on is like, how big do you think it can be? And how durable do you think it will be? One of the observations we have that I don't think is unique but i think is true is the companies that ended up being huge huge huge huge like hundreds of billions of dollars or trillions of dollars they didn't grow at 100 the longest they grew at 30 the longest you know what i'm saying like what they ended up doing was they compounded forever and so so much of what we're looking for is like why do you believe that this will continue to compound at 30 plus percent 10 plus years from now when it's well over a billion dollars or five billion dollars or ten billion dollars of revenue and i think that is what we're looking for that's the stuff that goes up on the wall and that's the stuff that is basically macro independent you know like you could have never dreamed i could be wrong on this but i think meta grew at like 22 percent last year on like 150 billion dollars of revenue or something and like Like there's no model that you're going to run in 2005 on like, well, maybe it'll add $30 billion of like high margin revenue 20 years from now.

2:30:19Right. But I do think that the bet you have to be making when you're in our business is sort of like, don't worry about the macro so much. Make sure that you believe that it's really going to be uniquely great. Yeah. Yeah. That's fantastic. I mean, you could leave it there. Do you have a last thing? This is fantastic. We'd love to have you back soon. You are the LeVar Ball of AI research to us. We're excited for the world to recognize. If this did nothing else but popularize sports, tech, and friends hanging out, I'll be super happy. I'll be honored to come back. This time next year, that post goes viral because we will have shifted the discussion.

2:30:57We will have taught everyone the sports analogies at such a deep level that they will get the joke and they will repost. All right, fellas. Take a day. Good hanging out with you. Talk to you soon. Cheers. Really quickly, let me tell you about Wander. Find your happy place. Find your happy place. Book a Wander with inspiring views, hotel-grade amenities, dreamy beds, top-tier cleaning, and 24-7 concierge service. It's a vacation home, but better, folks. And also, you go over to GetBezil.com. Your Bezel concierge is available now to source you any watch on the planet. Seriously, any watch. And we have our next guest coming in to the studio.

2:31:34Adam from Chariot Defense announcing the company. Welcome to the stream, Adam. How are you doing? Where are you? Doing great. Yeah. Calling in live from Detroit here. Long time listener. First time caller. Big fan of the show. Fantastic. Are you in town for Reindustrialize? I am. Or are you? You're not a Detroit native? Yeah, in town for Reindustrialize. We just launched on stage a couple hours ago. Congratulations. Let's ring the gong for a big performance. Hit the gong for a company announcement. I haven't hit the gong enough this show. Great contact. Congratulations. Now, break it down for us.

2:32:11Introduce the company. Explain what you do and how. And then we'll go into a bunch of questions and stuff. Awesome. Yeah, so Cherry Defense is solving a problem that I faced as the counter-US program manager at Anderil, where we constantly ran into challenges building all these new drones, electronic warfare systems, edge compute systems, at the edge, in expeditionary contested environments. constantly ran into power as a limiting factor. I was also the head of product Archer, worked at Uber Elevate, Kitty Hawk, saw really advanced commercial technology coming out of the EV, EVTOL industries, high voltage lithium-ion batteries, advanced power electronics, and saw DOD stuck with low voltage lead-acid batteries, massive generators.

2:32:50And so what we're doing at Chariot is building advanced power systems to power the next generation of military technology in austere environments. What's the core business model? Are you going to sell to the defense primes to countries? Are you going to go to program record? How does the business model work? Yeah. The great thing about this company is we have a lot of different business models that we can pursue simultaneously. So we can sell directly to the government to provide power systems that can bolt onto their existing vehicles. We can sell to companies and other OEMs who are developing new vehicles and help them turn those into hybrid electric, basically rolling power stations that can provide all of the equipment you need to put on those to make them survivable and we can sell directly to companies and we can tell alongside companies.

2:33:36So if someone's developing a laser system, that system's going to be a lot more effective at the edge with one of our power systems alongside it. So kind of flexible business model to government to business and international. Awesome. Can you help me kind of understand the general scale of the amount of energy that you're aiming to put out kind of the band? I've talked to Doug over at Radian, he's targeting the one megawatt diesel generator with a nuclear reactor. What are we talking about and what is relevant at that kind of power band? Yeah. So we're in the kind of 50 kilowatt range is kind of our sweet spot.

2:34:14So really what we're solving for is during counterinsurgency in Iraq and Afghanistan, we were operating either from fixed bases with massive infrastructure, or we were doing kind of short patrols at the edge where really all you needed at the individual unit level was a radio and a rifle and so you kind of have this power gap in the middle for expeditionary environments for things like directed energy you know so a company like epirus a company like aurelius developing these systems that require 30 40 50 kilowatts of power the existing military platforms we have can't output that kind of power but the power system needs to be able to deploy down onto a vehicle that can actually be mobile can fight in a distributed environment.

2:34:54Yeah, this feels hyper relevant to some of the reporting I was reading about kind of the Ukraine, Russia stalemate. Apparently, it's just like drone on drone warfare every single day at a complete. It's like World War One level, like stalemate and just like almost trench warfare, but just drone based. And so I imagine if you want to deploy a new anti drone system on the edge, you need to bring it and you need to bring in power. What is the alternative would people bring in some sort of diesel generator or I don't know fire logs or something What what's the state of the art and then I want to walk through a little bit about like how your solutions better Yeah, so the state of the art around power today is either massive diesel generators They're good at turning fuel into electricity, but ultimately they're they're very large They take a lot of space not very mobile with with lighter weight more distributed forces they're not very reliable those generators fail all the time and then all of your systems go down they waste a lot of energy and so if anytime you're running at less than your peak load what you see at the edge is highly variable loads and your generator is not going to perform on that environment it's going to throw away a lot of energy and most critically the challenge is the signature management so that generator puts off a massive thermal and acoustic signature and what you've seen in ukraine is people don't use generators within 30 kilometers of the front line because they know that that thermal signature is going to light up like a Christmas tree on an IR drone and be immediately targeted.

2:36:24That's fascinating. That makes a ton of sense now. So, um, how, like how, how, if we, if we comp this to the enterprise HR platform market, uh, obviously you're starting with something like that looks kind of like a point solution, not to use the wrong term or something, but you know, it's this one product. Talk to me about how you think about, is this like, we want to add on solar modules soon, and then we're going to add on wind farm, you know, connections, or, you know, talk to a nuclear company about partnering there, or is it more about different form factors in battery technology? Like, what are the different vectors that you plan to kind of expand upon versus partner on?

2:37:08Yeah. So if you think about the name chariot it kind of comes from in 2000 bc the sumerians used another source of power besides manpower for the first time horsepower so we talked about earlier on the pod you know the horse is the first autonomous vehicle yes we love the horse is the first you know power source yes uh for the military yeah and so you know we saw you know a transition you know from horsepower to steam power from steam power to the internal combustion engine right both really transformed military operations, we see a similar transition going from pure combustion engines to high voltage hybrid systems.

2:37:44And we want to build the power infrastructure for that. So what we want to build is the energy storage, the batteries, the power conversion and the power electronics, and then the power control layer that actually manages power at the edge. Today, someone will go plug in a coffee pot and it'll brown out the air defense radar because there's no logic sitting over these grids at the edge. okay honestly sometimes coffee can be more important than air defense in war i do gotta say caffeine it is pretty key yeah yeah yeah i mean so you might want to write that you might want to write the logic to be like this guy this guy needs a cup of joe yeah let him bring down the air defenses just for five minutes so he can get but maybe that's a plug for yerba mate you don't need to plug in your coffee coffee if you're drinking an energy drink it's already made for you that's right when did you when did you start the company when when did you uh when did you actually start the company uh so i started the company last fall we raised our seed from general catalyst and xyz um really great investors i'm really happy to have those guys on the team uh and yeah raised the company the seed back in the fall within three months we were at our first exercise powering lasers powering electronic warfare systems and within six months we were at JRTC.

2:38:56So when when when Secretary Drandiscoll and General George, Chief of the Army were on the pod. Yeah, they said they were going to go to that exercise the next week. You were there. We were. No way. That's amazing. I was going to ask about that. Army modernization. That's amazing. So that was six months from the first check into the company. We were air assaulting equipment into a force on force exercise. Had the opportunity to brief Dr. Alex Miller, General George at that event. Showed what we were doing supporting the warfighter. That's really cool. Sorry to go back to a technical question. signatures from batteries, essentially.

2:39:28Like I've heard like Tesla's put off EMF. I imagine that there's, you know, you talk about rare earth magnets. Like there's a lot of stuff going on in an electrical system. Is any of that still need to be shielded? Like what can you tell us about the future of as we transition? What's the next discussion we're going to be having about keeping troops safe? Yeah, certainly. So a lot of it comes down to, yeah, hiding below the noise, right? So signature management, you know, anything pushing a lot of power is going to have some kind of detectable EMI. With the battery, it's easier to shield it. It's easier to put under cover because there's no exhaust like there's from a generator.

2:40:07Sure. What a generator actually is is a giant spinning magnet that's generating an electric field that then induces or generates a magnetic field, which induces electric field, which actually generates the power. So significantly lower EMI. yeah um and i think part of survivability in in the future like how do we how do we have our troops survive what would i want you know going to the front lines in ukraine you want to be able to reduce your own signature you want to raise the noise floor so this this kind of expeditionary power system also allows you to set up deception decoy type operations where you've got a bunch of different things on the battlefield that all look kind of like uh yourself and uh so you're lowering the noise you know lowering your own signature you're raising the noise floor and then you need advanced countermeasures, things like directed energy, high powered microwave, iron-a-doo lasers.

2:40:51All of that really depends on kind of this fundamental power architecture. Any insights so far from Reindustrialized or of Investor? Every time you go try to watch a talk, some investor is hounding you, trying to hand you a check for your Series A. Any insights so far? It's been a great event. We love being at an event like this. There's a lot of other people developing core technology here, right? New countermeasures, new sensors, new drones. We really kind of see ourselves as kind of building the picks and shovels of this defense modernization effort. And so we've had a lot of great business to business conversations here.

2:41:28Companies who they can focus on, as Bezos says, making their beer taste better. And we can kind of solve this fundamental problem for them. So it's been great business to business collaboration here. Had a lot of great conversations about partnerships. It's been a great event. Amazing. I want to talk about some of the trade-offs of dual use in the context of storytelling around your company. This feels like something that it's military equipment, but it doesn't seem super dangerous to give to an oil and gas company. It doesn't seem like as regulated as nuclear weapons or missiles or something like that.

2:42:05This feels like it would be directly applicable in a bunch of other industrial scenarios. at the same time. As an early stage startup, you have to focus. You might not want to tell the story of, hey, we're gonna do this and this and this, and then all of a sudden investors are like, what are you actually doing? Just talk to me about your hangout with Dan Driscoll. You're clearly having traction there. What's the long-term plan? How important is focusing at various points in time? How important is agility and the ability to soak up a DOD contract when things are good there and they have a need, soak up an oil and gas contract when the industrial base is expanding.

2:42:42How do you think about the trade-offs both on the business side and then the narrative and storytelling side? Yeah, it's a great question. There's been a lot of talk around dual use. We are a dual use but defense first company. We actually think that this actually enables a really interesting play when it comes to critical minerals, bringing back the themes of re-industrialize. We are selling to DoD first. they are the ones who are willing to pay the most for that U.S. supply chain, right, for the ruggedization and for the sourcing of materials from allies. This allows those companies to have a demand signal, right?

2:43:16If you're building, you know, if you're building lithium refining, DOD is not going to buy refined lithium. They want to buy a capability. But we can say, hey, we'll buy that U.S. source lithium into cells, into packs, right? We'll deliver that as a capability to DOD, you know, be able to pay that early, you know, price premium that it's going to take to get down that cost curve. So we see ourselves as helping other companies kind of re-industrialize in addition to us, you know, having that customer that really focuses us at the beginning and building a truly great product. The go-to-market is obviously very different as well.

2:43:48And so we've definitely focused the team there. But we see, as we start to see some of these early contracts land, the ability to focus then on disaster relief, oil and gas, mining, right, other off-grid industries that have this critical need for power. Potentially the best news in the re-industrialized world or theme, other than the conference, this week has been that Apple is buying something like a half a billion dollars of rare earths from MP materials. From your experience, you're obviously trying to re-industrialize, probably trying to build as much as you're supposed to. Oh, he's re-industrializing.

2:44:23Oh, he's re-industrializing. Yes. He's actually industrializing. He's not trying. He's not trying. industrialized. But what in the supply chain do you think we should be having the biggest conversation about? What's the next thing that we got to focus on reshoring, reindustrializing around? What's underrated? What's the thing that people should be learning about now? Everyone learned about, well, we don't make the iPhones here. Then people were like, well, we don't have the rare earth elements. Then people learned what TSMC was. What should we be talking about in the supply chain for what you do in terms of large scale American industrial capacity.

2:44:57Yeah. And on the on the re-industrialized theme, one of the best hats I saw today was industrial based. That's great. So, yeah, of course, picking all those up, you know, for us. Yeah. The supply chain for for batteries is a case where, you know, along with many other industries, we we really invented a lot of technology here and then handed it over to China. One of the biggest companies now in the world, you know, CATL, that technology initially came from a company called A123 Systems. It was incubated in the U.S. It was developed in the U.S. Massive investment from the government into that capability development, but ultimately missed time the market, ran out of cash, and was effectively bought up by and then licensed to China.

2:45:40And China now dominates this critical industry around lithium iron phosphate batteries. And so that was a technology invented here and handed over there. You see a similar thing with It's DJI, right? We had great companies here, you know, Skydio in the early days, 3DR, Chris Anderson. And we effectively seeded, you know, that thing invented in the U.S. to China. So it's on the battery cell side and then on the battery pack manufacturing as well. Pack manufacturing is one of those kind of underappreciated parts of the battery value chain, especially building safe packs for DoD that can pass those certification standards.

2:46:13So just to clarify, the company we're talking about is CATL, is that correct? Yes. Okay. I just looked it up. We're gonna have to do a whole deep dive. This is fascinating. Never heard of this company before And I want to know way more obviously We can't have you tell us the whole story So we will we will dig in soon and we'll hopefully have you back on the on the show soon and we hope you enjoy the rest of Reindustrialized. Congratulations on the launch. Say hello to literally everyone. Yes, say hello to everyone And I just want to say I can see why you've been so successful to date. You're very very very impressive And I'm glad that you're building this company.

2:46:45Yeah, thank you. Thanks for having me on guys. We'll talk to you soon Bye Let's tell you about 8sleep.com Get a pod 5 ultra They have a 5 year warranty 30 night risk free trial Free returns And free shipping The best sleep of your life Podcasters sleep on 8sleep That's right And our next guest is here We will bring him in How you doing? Misha What's going on? Launch day Launch day Welcome Hey guys Good to see you. Thanks for having me. Thanks for hopping on. I saw the post going viral. I checked the calendar. We'd already booked you. It's working. Perfect. It's amazing. Thank you so much for coming on.

2:47:29Why don't you kick us off with an introduction on yourself and the company, and then I have a ton of questions about how engineers are understating code. Yeah, sounds great. So just a quick primer on the company. My co-founder, Yanis, and I were deep mind researchers. before this, ourselves and our team, which is mostly from DeepMind and also from places like OpenAI and Anthropic, pioneered a lot of the large language model and reinforcement learning breakthroughs over the last decade. And we set out about a year and a half ago to build a company with the mission of, I mean, it was the mission of building super intelligence, but we had a pretty, let's say, almost practical and opinionated view on it that I could not build in the abstract that you had to really define it as both the research and the product agenda.

2:48:14And so we thought about, well, what would a superintelligence in an organization look like, which we think is basically going to be this omniscient oracle that knows everything about the company and can act on the user's behalf. And if you want to build towards that, we then kind of work backwards of where do you start today? And so today, what we're launching is a product called Asimov, which is the best code-based comprehension system in the world. So it's like a code research agent that is sort of the submissive oracle for engineers about their code and can answer any question that they have.

2:48:50And that's kind of our first step. Okay. You're clearly an ASMA fan. Maybe an easy question, but is the solution to AI safety just the three laws of robotics? Like if we just bake those into the system prompt, are we good? You know, I think that we are actually kind of doing that already today. Like when you write these rubrics for language models to kind of go and evaluate whether something is behaving well or not. And similar to the Asimov conclusion, the conclusion here is that this problem is much harder and it's very easy to hack these kinds of rubrics and build systems that are not aligned.

2:49:29So I think the answer is a no. But it's kind of a big problem that doesn't have a very simple, I think, silver bullet answer. Yeah, yeah. I mean, certainly as I've tussled with the AI safety narratives of the last few years, I've gone all back and forth from, okay, this is a very crazy doomsday scenario that's fantastic sci-fi to, to, okay, there are some very concrete problems that need to be addressed as these systems get rolled out, even just from time and attention and people being overly focused or optimizing on user seconds going wrong. There's so many things, so it's a fascinating space.

2:50:10When did you actually start the company? And this is your first launch, correct? We started the company about early 2024, so a little over a year ago. Right. And how was that, I'm curious, the decision-making process to go strike out on your own, obviously with a great team, but as a researcher, like deciding whether to stay in an environment that had, you know, massive scale and resources versus going into a more resource-constrained environment. Obviously, there's a lot of capital available for great companies and teams, but it's still quite a bit more resource-constrained than something like a deep mind.

2:50:50I think that every Frontier Lab, that's been built was built when it was kind of had enough resources and had a good team, but was definitely resource constrained relative to the kind of big incumbent. And so I think what's really interesting to myself and to the team that's been assembled here is how do you build out the sort of next AlphaGo or the next GPT? I think that was like the most interesting time to be at these, you know, what are now incumbent labs when the initial breakthrough projects that define them was just being formed. And we think there's an opportunity for the new kind of AlphaGo to be built, which is going to be embodied not in a game of Go or a simulated setting, but is going to be embodied in an extremely powerful and useful product.

2:51:37And so we kind of think about these two things of like, how do we set the research agenda to drive breakthroughs via product on this mission to super intelligence? So I think it's really if the researchers, you know, happy kind of entering like a big ship and being a kind of small part of it, which, you know, there's definitely reason to do that. It's fine. You know, it obviously pays very well. That's one path. But if you want to start kind of a new frontier lab and drive a new series of breakthroughs, I think the best place to do that in our really small focus settings. You mentioned AlphaGo.

2:52:15My interpretation of that story, I was obviously very impressed that AlphaGo beat Lisa Dahl. I thought that was incredible and unexpected. But I was more impressed by Move 37. And I think that the reaction to Move 37, this uncharacteristic, difficult to interpret move that seemed like an error, seemed like a blunder, turned out to be important, turned out to be critical to winning that game, showed a type of creativity and sort of a solution to the spiky intelligence. It didn't feel just like playing the best game of Human Go. It seemed like it was playing something different. And so my question is, is that the correct understanding or history of the AlphaGo-LisaDoll match and that story?

2:53:04But then also, So are we still waiting for a Move 37 moment in LLMs? So Move 37 was actually, I was a theoretical physicist before. And when I saw that, I decided to get into AI. And my co-founder, Yanis, was one of the key contributors to AlphaGo and was there in Seoul when that happened. And I think that you're exactly right that this was probably, I think, still one of the most beautiful artifacts to ever be produced in AI, and that we have not actually gotten to the point where we're seeing Move 37s coming out of these language models. We're seeing like they're solving math olympiads, they're solving coding quizzes, but we're not seeing that level of net new creativity.

2:53:56And that is kind of one of the guiding kind of you know things at this company is how do we get to these systems that start showing move 37s in the real world like beyond kind of math olympia ads beyond games of go how is it you know like that i mean i don't want engineers or like people in uh in enterprises to see a thing that i gives them like be perplexed like lisa doll was with move 37 but i do want to strike that same sense of kind of beauty that this thing is discovering new technology um in front of So that is definitely what we're moving towards. Do you have a reaction to the latest Guern essay about LLM daydreaming, this concept that maybe if you run LLMs across all sorts of different ideas, pick random words, try and find connections, you can kind of brute force innovation or innovative thoughts?

2:54:50Because we've seen that LLMs seem like insanely high IQ, math Olympiad, as you mentioned. and yet have yet to write a really novel funny joke or come up with a new connection in between the different sciences. And it feels like we're in the spiky intelligence moment. A lot of what's produced feels kind of like a very much an average of the internet. It's sometimes midwitty in many ways. It feels uninspired. And Gorn was coming up with this idea that maybe there's a different solution. Did that resonate with you? Did you read that or do you have any other ideas of how that could possibly play out?

2:55:31Well, that essay definitely resonated, though, you know, as a true reinforcement learning believer, you know, we've seen super intelligence arise multiple times now. That was the game of Go and AlphaGo, Dota 5 and AlphaStar, these projects from OpenAI and DeepMind were getting close to it. And I think at that point, if they just sunk more compute in, they would have gotten super intelligent video game players more broadly. And so I think reinforcement learning, when it's set up right, it never fails. Now, the challenge is that if you're setting it up to solve math Olympiad questions, there's no reason to believe it why that would generalize to actual mathematics.

2:56:12It's kind of like a student that's really good at taking tests. It doesn't mean that you'll make a great mathematician. And so I think that without engaging with the real world and real world evaluations, it's really hard to build super intelligent systems in the real world. So I think this kind of benchmark maxing is a bit of an ego play. And I'm much more interested in models that are trained with reinforcement learning for real world stuff. And maybe they're a bit worse on the benchmarks, but users really love them. And I think we'll start seeing super intelligence come out of those systems.

2:56:45I don't think reinforcement learning will fail us. Do you think we need verifiable rewards in physics discoveries or something like that? Like, how can we RL against something that, like, I've been, my Coogan's eval is basically, or Coogan's benchmark is basically, tell me a joke and see if I laugh. And it feels extremely hard to eval against. You have to, you know, pay a bunch of humans to sit in a comedy club, or they have to pay. And then you have to record the voice of the laughing or something. I don't know how I would RL against something as squishy as a joke or a fundamental new insight in physics.

2:57:25It feels like it might be intractable. But what is your take? I think the verification problem is kind of the most fundamental problem across all artificial intelligence. When I was working on Gemini, I was leading reward model training. And that was basically figuring out the verification question. So that is, I think, the basically biggest bottleneck. And so there's kind of some systems have verifiable rewards. Others, you kind of have these rubrics. But I think fundamentally the limitation is like, what are you evaluating? So in the physics thing, you might have verifiable and even rubric rewards for physics problem sets, physics olympiads.

2:58:04but getting that for you know actual physics work like working very closely with physicists and seeing like what their day-to-day is and you know there's um i don't think there are any companies that are actually doing that because it's it's a bit of a slog and it's unclear if it's even economically viable but that's the sort of thing that you would need to do you would need to make a simulation that is as close as possible to what a theoretical physicist actually does the challenging thing is that there aren't that many theoretical physicists that you could even work with to really understand them deeply so it is kind of a data constraint problem but i think it's fundamentally an evaluations problem yeah that that's kind of a hilarious scenario that for some of this basic science research like the it might cost like a billion dollars in compute and you cannot underwrite that if you're not coming out the other end with like a patent And so that's like pretty tricky.

2:58:57What was the moment internally for you guys that you felt the product was ready to launch? I think we've been so we believe that coding is this kind of root node problem to super intelligence more broadly just because that's how language models interact with software that's sort of like their hands and legs and then we were trying to figure out well where are we today and why you know like what's preventing us from building super intelligent systems um and the short of it we kind of realized that coding agents right that code generation stuff is starting to work like we have these semi-autonomous systems but they're basically like semi-autonomous systems with amnesia like they They forget everything.

2:59:40They have no context. And it's sort of like if you watch like that Adam Sandler movie, 50 First Dates, it's kind of like that for coding, right? So like every day your coding agent wakes up and knows nothing and has to learn everything from scratch. And so the fundamental thing that we felt was missing that needs to be solved is this ability to comprehend very large organizational code bases and the software and kind of systems around them and build this memory, like this contextual core for agents. And I think this will sort of generalize beyond coding, right? There's sort of every single discipline and organization is kind of context bound.

3:00:16So even if we get really smart generation agents, that doesn't mean that they'll actually be useful. So I think it was kind of having that insight, building the initial product around it, seeing how it's utilized on our team on a daily basis and how our initial customers are starting to use it. And just having a lot of confidence that this is the big unsolved problem that we kind of identify and are seeing kind of good momentum around. Can you talk to me about what you're excited about on the GTM side? Are we going to be seeing a frustratingly viral Cluely style ad from you? Are you going to set up channel sales like what we saw at Windsurf?

3:00:59Are you going to go Enterprise? What's the most interesting to you in terms of actually getting the product adopted at scale? so we think kind of most of like most of the problems where super intelligence will be useful like extremely useful and valuable um is going to be within large organizational settings like when i was working at you know deep mind in google's largest mono right it's like this massive mono repo um it has to be like that's the kind of scale where these systems are most useful now obviously like most enterprises are not at that scale um and so it's very much you know it is an enterprise product.

3:01:38Now, in terms of like a go to market, you want to go for the enterprises that are early adopters. And so one of the things that we've really been doing is that as opposed to kind of traditional SaaS that might go viral with more consumers, enterprises don't want their code and like all their proprietary data leaving their cloud. So we built it in such a way that it's just deployed on their cloud resources and are working with kind of the early adopters where that deployment is fairly straightforward. So that's kind of our go-to-market today. Yeah, that makes a ton of sense. Any other questions, Rudy?

3:02:13Not for now, but this was great chatting. Thanks so much for the insights. And always welcome to come on the show when you see if there's a current thing on the timeline that you have strong feelings about, shoot us a note and jump on. Let us know when you see a Move 37 moment in anything. That's what I want. You're our official Move 37 correspondent. I'll send you a text as soon as, the first time I see a Move 37, you'll be one of the first people to know. Please. We'll put up a breaking news banner. Move 37 moment. Achieved. Achieved. Thank you so much for hopping on. We'll talk to you soon.

3:02:42Awesome. All right, guys. Thank you. Bye. I want to talk about the bull case for nothing ever happens. OpenAI runs its entire business on Salesforce and Slack. Did you see this? An unusual part of OpenAI is that everything, and I mean everything, runs on Slack. There is no email. I maybe received 10 emails in my entire time there. If you aren't organized, you will find this incredibly distracting. If you curate your channels and notifications, you can make it pretty workable. And then the follow-up here from Matt is, you can just vibe code a CRM in a week. And they say, oh, we use Salesforce, which is very funny.

3:03:18Also, Replit has been on an absolute tear. Chris Franz has a post here. Not sure how you see a chart like this and then just continue living your life. It's interesting because I feel like I've been aware of Amjad for more than half this chart, probably since 2018. I've kind of been following him on X, and he was just grinding it, grinding it out, and then from 10 million ARR to over 100 in just a few quarters. Fantastic work from Amjad Massad over at Replit. And it's interesting because people were always saying Replit is just like the hype is ahead of the revenue. And then they just stayed at it, grinded, and it caught up, which is fantastic.

3:04:04So speaking of crazy charts, Raj Behr, who we've featured on the show before, says the Cloud Code command line tool is now at over 3 million weekly downloads, more than the monthly downloads of the Cloud iOS app. Wow. Yeah, this is the winning. They are winning in code. OpenAI is winning in consumer knowledge retrieval. And the market's forking. And in other news, Grab-A-Gun has gone public on the New York Stock Exchange under the ticker Pew. Pew. They went out this morning. We covered that like months and months ago when we read some story about, it's the president's son, correct? Yes. Is it Don Jr.

3:04:49who's involved? On the board, I believe? Yep. Very cool. Well, interesting business. Been around for a long time, right? Grab a Gun is an old company that then brought in some new investors, some new talent, and then went public. Is that right? Yeah. Founded in 2010. Okay. Amazon for... Weapons. Weapons. Interesting. American Dynamism. Amazon for weapons. Yeah. But, yeah, wouldn't have predicted this company would be... Is it doing well? I mean, it's hard to say. I mean, it's down. down 23 % today, but who knows where it'll shake at? Who knows? Who knows? Freedom. Jeff Huber says, I think about this a lot and shares a screenshot of why GitHub won.

3:05:31So to sum up, we won because we started at the right time and we had taste. We were there when a new paradigm was being born and we approached the problem of helping people embrace that new paradigm with a developer experience centric approach that nobody else had the capacity for or interest in. I guess the question is, what is the next sea change in developer workflow, and who will have good enough taste to make it explode in the same way? Interesting about this is that GitLab, which is an open source version of GitHub, is also a very successful company. I believe they're a public company. They might be one of the YC companies that's gone public.

3:06:05But interesting that something is network-based and developer lock-in as GitHub still had a second, like a direct competitor, I think. GitLab and GitHub are pretty similar competitors. And they both were fantastic outcomes. GitLab down 62 % since IPO-ing in 2021. Still a$7 billion company. $7 billion, yeah. I mean, that's like, if somebody's going to come to you, you're going to get the feedback if you're founding GitLab. Oh, you're going to get enrolled by GitHub. Yeah. It's interesting that they've effectively kind of missed. they just didn't have a good AI horse in the race clearly. Maybe they should pick up some AI research or merge or something.

3:06:53I like that the horse sound effect is back online. It's back. I asked Ben, do we have a horse sound effect? And he texted me, yeah, it's the button with the horse on it. Was it? It was correct. I'm blind. I've got to get on with Taipei actually, so we've got to wrap the show up there. We will see you tomorrow. We will see you tomorrow. It has been an eventful week so far and can't wait to see what the rest of the week has in store. We'll see you tomorrow. Leave us five stars on Apple Podcasts and Spotify. We'll talk to you soon. We love you. Bye.