Weekly Recap: Apple Debuts iPhone 17, Einstein of Wall Street, YC Demo Day, Declining AI Adoption

25:36So now we can go down and actually handle these workflows end to end with our agents. Who is your favorite entrepreneur of all time? Someone you look to for advice. Peter Thiel. First person to see PT. So yeah, why is this sitting here? What do you do? Introduce yourself. Who are you? Yes, my name is Zane. I'm the founder of Knox Metals and we cut metal. So we're trying to build the most efficient metal service centers in America to empower every factory in America to work with better margins and to move faster. Okay, there's a lot of ways to cut metal. He's doing the meme. He's doing the meme.

26:08He's doing the meme. He's re-industrializing. Who's your favorite entrepreneur? Alex Karp. Of all time. Alex Karp. We've had him on the show last week. Introduce yourself. Who are you? What are you building? Yeah, so hi, my name is Vihar, and we're building Orange Slice. We're basically AI search infra to help you find customers that already want your product. Who is your favorite entrepreneur of all time? Oh, that's a good one. I don't actually know that many entrepreneurs in general. Someone that you read a biography of or look up to, or maybe just saw a recent interview with and thought was, I could learn something from them.

26:40He's Lisan Al-Ghaib of Enterprise SaaS. He doesn't need a blank slate. He doesn't need any influence. Well, honestly, I don't draw that much inspiration just because I think the biggest motivating factor in this might be contrarian. It's not actually inspiration, but like the fear of mediocrity of it not working out has been way bigger for us that's biggest reason I don't have that much inspiration but Eric from the rent from rent my co-founder used to work at ramp so I mean they introduce yourself what yeah who are you what do you do my name is Arlen I am building a Zomio which is an API that gives more context to agents okay so if you're a cursor user yeah you can pretty much just go to cursor yeah it's any any documentation or code base and give it as a context to an agent.

27:27What exactly is happening? I know cursor does kind of roll ups of what's happening. There's some brag infrastructure that's popular. What else is going on in the actual product to unlock value? Yeah, so the two reasons I build this is because I was so fucking pissed when I would like go to Google, copy paste all the docs and paste them right in the cursor. We've all been there. Yeah, the memory is not persistent. So they will fucking forget that in like two seconds. And second one is that you also pollute context window, which causes context fraud. It's actually a study done by Chroma, which is like a company.

27:57Oh yeah, we know Jeff. Yeah, saying like post 4 ,000 tokens, I think, like the performance of any LLM goes like this. So that's like the reason I build this. Who's your favorite entrepreneur of all time? Yeah, who the fuck that most money, bro? Like Elon Musk, yeah. Yeah, he was the richest man, bro. But otherwise, yeah, Brian Chesky is my goal. I love Brian Chesky. Brian Chesky, founder mode. Would you mind introducing yourself and your company? Sure. So hi, everyone. I'm Alessia. Vibeflow is the only one solution to build production ready apps in no code. Okay. We've seen a lot of news recently that there's now a whole industry of Vibecode cleanup specialists.

28:31What's your reaction? Can Vibecoding ever make it to production? No. Not now at least. All the solutions out there are really broken and they give you this wow effect in the front end. But on the back end side there is so much to do and there is a huge need. people are like they have hair and fire problems and they need to solve these problems so the market is huge who's your favorite entrepreneur of all time my favorite entrepreneur is taylor swift i'm a big fan and she is amazing introduce yourself for the stream who are you what are you building well i'm joshua march i'm the co-founder and ceo of veritas agent we build ai agents for the consumer lending industry okay so interfacing with borrowers to help help doing sales, servicing, collections for like fintechs, banks, credit unions, services, that kind of thing.

29:18Who's your favorite entrepreneur of all time? So there's this guy, Felix Dennis, who was a British entrepreneur. And he wrote this book called How to Get Rich, which I think is the best book on entrepreneurship. What you actually do. Yeah. My name is Kevin. I'm the CEO and co-founder of The Prompting Company, and we help product get mentioned in ChatGPT. Okay. Okay. Okay. Not just another generative engine optimization tool. Yeah, yeah. How do you differentiate? Yeah, for sure. So we plan the infrastructure layer. We're not just creating articles for you. We create shadow sites for our companies to influence all of them.

29:53Who is your favorite entrepreneur of all time in history? In history? Anyone, alive or dead? Dude, Steve Jobs. Steve Jobs, there we go. That's a great one. Introduce yourself. Who are you? What do you do? Bob. Hi, I'm Bob. Welcome to the show, Bob. CTO of Embedder. We build coding agents for firmware. Okay. Coding agents for firmware? Firmware, yeah. What device are you embedding firmware on? They said it could be done. So we do microcontrollers, Linux computers, so think about any microcontroller you can think of. STM32, ESP, TI, NXP, any manufacturer. When did you learn you wanted to do coding agents for firmware?

30:26That's a good question. So I did hardware all my life. Started when I was small, doing robots, moving to more professional stuff in high school. In college I built humanoids. and then went to a startup, did med tech stuff, and then went to Tesla, worked on RoboTaxi. So we kind of saw it. I saw this problem from like a 10 % research lab to a trillion dollar company. Who's your favorite entrepreneur of all time? Oh, Elon, has to be Elon. There we go. Introduce yourself, what do you do? Hey, my name is Sion, we're Kalinda. That's a great name. Yeah. We're basically a deep research for class action law firms.

31:05Okay, interesting. Yeah. Let's give it up for litigation. Yeah. What's the secret sauce? Is it just the bad data in, bad data out? You gotta get private data that's maybe behind some sort of wall. It's not scraped into the pre-training weights of GPT-5, and so you have some cornered resource in the data, or is it something in the architecture, or something at the UI level? Like, where's the interesting? Well, kinda like most startups at YC, like, a lot of it sits on the application layer. Sure. Most of it for class action law firms is the scale at which they do things. They can have maybe 10 million pages for litigation.

31:40Oh, wow. So with that kind of scale, you can't obviously just toss them to check. Yeah, it'd be a hassle and just click upload another PDF, upload another PDF, upload another PDF. And then the kind of second thing is like most of the data sort of sits in silos and kind of aggregating it all and making it sort of comprehensive like human would. Who is your favorite entrepreneur of all time? Sam Altman. Sam Altman. Just because I've met him twice, but he's the GOAT. Introduce yourself. We haven't pitched yet. Who are you? what do you do? Raf Garcia, founder of Kernel, we're crazy fast browsers in the cloud for your AI agent.

32:13The browser wars. The browser wars are on. But this is computer use, so it's API to go and interact with the website. Yeah, so nowadays a lot of AI agents, you want to hook them up to the exact same tools that humans use, and the browser is one of the main tools that we use on a day-to-day basis, and so we're powering automations in healthcare, fintech, QA, lots of different use cases that AI is really good at. Who is your favorite entrepreneur in history? Who do you look to? Favorite entrepreneur. How far back are we going? We can go live or dead. Literally thousands of years. You can go Edison.

32:49Somebody has mentioned Jesus Christ. Somebody has mentioned Eric Lyman at RAMP. I didn't make the comparison, but it was made today. I mean, cliche, I'll have to go Steve Jobs. I mean, I grew up reading and studying Apple. That was my first computer as a kid. Who are you? What do you do? Explain yourself. My name's Adi. I'm a co-founder of AgentMail. It's the first email provider built for AI agents. The key distinction is we're not AI for your email, we're email for your AI. Okay. Oh, interesting. Like browser use for agents. Okay. I was wondering about this because I go to agent mode and oftentimes it hits a wall where it's like, okay, it should just now, it should just email the person to actually kick off that process and it can't do it.

33:32Yeah. How much money are you making? How much money are we making? Yeah. Did you share KPI at demo day? Did you share progress? What KPI should we do? We did not, but we love our customers. Okay. Okay. But there are, but you see customers plural. So I know there's more than one. Yes. Okay. I'm learning. I'm learning. Okay. Did you come in with this idea or did you pivot to it? So we were trying to get rich quick. Is that why you're, is somebody vlogging out there? Or is that someone else? Yeah, exactly. We're like hustlers. So you're getting that YouTube ad sense for me. So we wanted agents to go on the internet, make us money, farm free trials.

34:08And then we realized, okay, it's kind of hard to give agents their own inboxes. But they should have them. Sequoia is talking about them. Langchain is talking about them. Agents need their own email inboxes. Who's your favorite entrepreneur in history alive or dead? I like Warren Buffett. Warren Buffett. Interesting. I think he's one of those guys who's like actually humble. Yeah. Right. Like it's not like, okay, hey, I'm worth a hundred million. I think he just genuinely is in it for the love of the game. He does. He's in it for the love of the game. Hopefully one day, you know, I could be like that.

34:36Who are you? What do you do? Hey, I'm Aleth. I'm building Riff, which is Cursor for music production. Ooh, that's fun. Are you sitting, so Cursor sits on top of an open source IDE. Are you sitting on top of Ableton or something? That doesn't exist for music. So we actually built everything from scratch, trained our own models. Sure. We have our own like editor. It kind of looks like GarageBand, but you can use AI tools to generate sounds and mess around. Interesting. Do you bring your own samples or do you plug into a sample library? Are all the samples AI generated? Yeah, we have a user community of samples, but we also let you generate your own.

35:11And also lots of bells and whistles to make it easier. For example, you can hum out a melody and we'll play it on an instrument for you. That's very cool. Favorite entrepreneur in history, Live or Dead? Dr. Dre. Dr. Dre! I knew I had to ask you. Anyway, thank you so much for coming on. Introduce yourself. Great to have you. Who are you? What are you building? I'm John Ferrara. I'm building Juxta, which is a GPS alternative that can track anywhere on Earth with no hardware. I feel like I've seen this on X. You might have seen our, we had a pretty cool launch video. Very cool. Yeah. Okay. So how does it work?

35:44There's some company that spun out of Google that just sold it, does something similar. It's like magnetics. But how are you doing it? Yeah, so we basically use simulated technology to basically render any environment using satellite imagery or indoor floor plans into 3D. So you do a GeoGuessr? You could put it that way, yeah. Sort of? We should have the company that way. And then we simulate millions of people or objects moving through outer space, simulate their sensor measurements, like accelerometers, gyroscopes, and then train models on that, and then basically deploy the software, and then we can leverage the IMUs, which are like sensors that are already into every phone and most other devices today to track you.

36:15It's adjacent to that. Crazy. So like I can see you through your wife. Lots of people love. Yeah, if you've seen that film in like the dark night, there's like a scene where Batman make kind of. Yeah, I know the one you know, you know, that's how you can envision. Yeah, who's your favorite entrepreneur in history? Live or dead? Oh my God. I would say I would say I know the riff guys just said Dr. Dre, but I'll say Drake because he just came out that Amazon store and Drake's my favorite artist. So what Amazon store? I don't know. You haven't seen this. this is his actual plot to take over Amazon Music as a distribution platform, but he's working with Amazon to sell all of his merch and all of his goods through their storefront and basically facilitate all their distribution through there.

36:52So that's my cop-out answer, but I just love Drake. We have a special guest with us opening the show. Introduce yourself for the stream. Hi, my name is Peter Tuchman. I'm known as the Einstein of Wall Street. Einstein of Wall Street. I'm not that smart. I just look like it. Who was the first person? Did you give yourself that? Erin Burnett gave me that. And I've had a show on her show now on CNN. for the last four months ever since the beginning of the sort of mini crash that uh was sort of self-induced by our our the new leader the new the new sheriff in town but correct and she called me in so she used to work on the floor with cnbc sure and she nicknamed it probably 20 years ago and called me einstein and that sort of picked up but your latest your latest collaborator uh is not on tv but on streaming correct correct so i had the fortunality of actually meeting I Show Speed.

37:41Oh, yes. Right? Young 20-year-old kid who I got invited. So there's a team that's doing his stream thing. There's a young guy named Adam Faze. We knew Adam. He came to our event. We were here about a month and a half ago. He came to a party. Really? So Adam is something special. Yeah. He found me about four years ago and asked me if I would let him shoot me every day walking out of the Stock Exchange for 30 days and just do what I do. Sure. And we did this whole TikTok thing called Einstein Elementary. went viral like me and like marching bands from Brooklyn and walking around with a 50 pound Hershey's kiss and doing all this crazy stuff so he called me last week asked if I could bring speed to the floor and it didn't seem appropriate at the time and he said well how can I get you to meet him and I said come up with an idea and he's an idea guy so he called me on Thursday morning said we're gonna be at the ball yeah he's gonna be at the ball would you come and welcome him to wall street I said absolutely so they gave me a police escort I went down there and met this young guy and talked about some of the shtick I do you know investing in stocks and not stuff and about you know the fact that um you know that everything that his life is based on is actually a publicly traded company and then instead of you know buying the next iPhone he could probably buy a couple shares of Apple and then maybe you know he could invest in his future besides the amazing futures got set up he received it totally he talked about it a couple days down the road so I got the message across and uh and i've blown up i've gotten literally the number 200 so i have now i came in at 260 000 followers on thursday and now i have 419 and counting and i've got 40 million views on some of my posts 7 000 dms 7 000 dms i actually just did a video to answer that anyway uh what was the first stock you ever bought oh you know what i very rare i did not ever buy a share of stock until recently.

39:33I went through most of my career because I'm a registered trader, a broker on the floor. And I'm not allowed to be in a stock for a customer and for myself in a 30 day period. And so I built a trading strategy 20 years ago, trading the S &P 500 based on information that I have as a broker on the floor. And I trade all 347 names in the S &P every day. So basically, I made a decision years ago, you know, and also money does a funny thing. If I'm in a stock for myself and I get an order for a customer, it's going to impact the way I trade. And I didn't want that to ever be the case. So I do well enough here as a commission broker that I said, you know what, I'll invest in my kids, I'll put them through college.

40:11And they both graduated without any debt. And that's where my money went. What about some of the first stocks that you were brokering? First stocks that I broker? So we're here, we're talking about IPOs, right? And so, you know, I probably have traded more IPOs than anybody on earth. I've been in the crowd on all of them. I mean, the first IPO I think I traded was LinkedIn. in, right? It was priced at 30. It opened at 60, ran up to 180 same day. And that was where I got the sense of how amazing the enthusiasm around an IPO, because it's based on confidence. Nobody knows it. And so I've had so many fun experiences in IPOs.

40:46Jack Ma, Alibaba IPO, which was one of the biggest that we've ever had here, he and I bonded. So the IPOs here take probably four or five hours. We just opened Klarna, right? And the process behind that, which we do better than anyone in the world is the price discovery process that what goes on. It's kind of like building a building. The way you open a stock, the way we open a stock, it takes time because it's a matter of the information going back and forth. It's a public offering. So the public has to understand what's going on. And so we go back and forth with our customer. It's kind of like if you put the bricks and the mortar in the right place and you, the way a stock opens, if it's built correctly, is going to purport the way it trades forever.

41:25Now it doesn't guarantee it's going up but it will have structure and foundation and you know you go to nasdaq nothing against nasdaq but if you go to nasdaq it's philly electronic so it opens when the buyers and sellers meet in an electronic marketplace here it's different so then you're going to see what you see in that it'll go up it goes down there's no there are no guard rails right so here things are a lot different so jack ma and i spent four hours together in the ipo he and are very short so we bonded on the fact that we were the shortest people in the crowd we were on the same level not financially, because he became a very wealthy guy again on that day.

42:01Someone on our team actually was here for the Ollievall IPO as well. Amazing time. And then we've had, look, the whole landscape has changed when WeWork completely blew up the whole IPO market. And that affected... Tell us that story. Because I remember the S1 going out, but then did they get out? What ended up happening? Look, as I said, it's built on confidence. And when everybody, it was huge money put into WeWork. He was lauded by now he came down to the floor many times and it wasn't until the night before everyone needs to know this That on the end of the road show is when all the financials are given out to the public And it turned out that it was all smoke and mirrors and he had spent all the money on Prostitutes and blow and that the company had nothing no basis behind it And so it was aborted the deal was aborted and what that did was it changed Amazingly enough that one stock could change the landscape of IPOs for years years it literally everyone says People say, guys, yeah, windows closed.

42:54That's what closed it. That's what closed it. And I remember Jim Cramer on Mad Money was saying, we don't want this. We don't want this. Exactly. Remember that quote. And so to think that you know something about what's going on and we didn't know anything on literally until the night before made such a huge impact on the market. It literally has taken a couple of years to grow out of that. Before that, we had had some really wonderful robust years, Remax and a bunch of stock. They would open the huge premiums. We were trading 10 IPOs a day. Give us a quick history on Klarna, right? Because Klarna has tried to get out a couple times.

43:27Okay, so I don't know the history about Klarna. All I know is that I watched how it opened here. So it did take a little while. It did open at 52, I think, right? And so it's not trading. You know what? It's hard to know. So what's important about it is where the bids are, where the offers are, and how the foundation looks. So where the bodies are buried within the stock when it opens, right? There was enough stock at 52 bid on balance, which is what it's called. So stocks pair off that are priced accordingly. So four point something million shares open. That means that they were market orders.

43:58They had no limits to them. And that's they that was they paired themselves off. It was a 52 bid for 300 ,000 on balance meant that there was a stabilizing bid, whether it was by the Goldman Sachs, the company or the banker or not. But that's what made it open at 52. If there had been more to buy at the market, it would have opened higher or more to sell. It would have opened lower. It opened at 52. It did trade up to 5720 on a small bit, 70 ,000 shares traded up, and then it came in. It's trading at a couple dollars lower, which is reasonable. It does not have the power and the impact that Figma and Bullish did.

44:32Figma and Bullish. But all three of these are relatively, like, is there a specific strategy that these IPOs have had in terms of, like, pricing at what feels like very reasonable? So, you know what? They're pricing it based on the reaction to what the investment community is willing to give. It is. So, some of the other ones got priced at$30. There was an over-demand at$30. They upped it to$32,$35. That's how it will go. So the last night when they go out to the roadshow to give out allocations, they will get a sense of where that valuation should be. And then that's where they will give it up.

45:13They left some money on the table, as did those other IPOs. The other ones opened at 90 and went to 117. That was bullish. And Figma also traded a huge premium. My gut is that the sectors that they were in, there's a lot of pressure on this sector right now. Totally. And so those sectors were more iCloud and AI-based, right? And so I think that's why there was a little more pop to it. Well, we know you have to get out of here. Thank you so much for stopping by the show. We'd love to have you back sometime. Anytime. I'm always going to talk for another two hours. Let's go. So thank you so much.

45:46I love it. Let's go. We need to dive into the Apple and the iPhone announcement briefly. Obviously, this has been talked about. It happened a couple of days ago. So, but the post that stuck out to me, there were a few about the design, but the big one was that the iPhone 17 Pro now has more graphics power than an M2 MacBook Air. I have, this is a MacBook Air. I don't know if this might be the M3 or M4 version. Would have clocked you as an Air guy. I just went for it because I was like, I'm traveling more. I'm less in workstation mode. And so, like, let me give this one a try. And let me see. I have the M4.

46:23So I think I have more power here than the iPhone 17 Pro. But even just two years ago, it's crazy to think how quickly the chips are shifting from workstation, which is huge, you know, laptop to phone. And so I wanted to talk about what the downstream implications of this are. And did you see the camera functionality? Apparently, if you can take a photo holding your phone vertically and it will give you the landscape. Yeah, because again, I think it's a square sensor that's maybe 48 megapixels. How are you feeling about the orange? Do you think this is Tim Cook signaling that he's a BTC Maxi? Oh, I thought it was him giving a little nod to Gary Tan, my Combinator.

47:08That's one or the other. Clearly. Had to be one or the other. Yeah. It is the colors. I like orange. I think it's an underrated color in general. but still the color options were interesting. Like no map. You would have thought they would have done a matte black. They didn't do matte black this year. They just, wow. So they have a silver and like a blue, I think. Something like that. I like orange. I think it's a cool, bold color. I think it's one of the ways to stand out. It's McLaren orange, you know? McLaren orange, yeah. Looks like F1. Maybe it's a nod to that. Who knows? But they're having fun with it.

47:46Hopefully next year, the color I'm pulling for, ramp yellow can you imagine the ramp yellow iphone uh it just might happen maybe we'll we'll make it happen um but on the tech side you know people were pretty uh like there were a couple takes early that were pretty like bearish like oh like nothing changed nothing changed and uh ben thompson summed it up pretty well tim cook i mean you had a funny banger about that i mean tim tim cook posted um he did post yeah the morning of and he was like days like this make apple you know like like basically like hyped it up as as though it was going to be this dramatic announcement and yeah and i think people were pretty yeah pretty let down at this point if it's not a change in the overall form factor like you're going to folding phone it's not going to be as easy just to talk about completely um but at the same time it has a bunch of uh it has a bunch of improvements that i think will have downstream effects that might be interesting and might actually have kind of these like viral moments and i'll get into my thesis here so uh it has a vapor chamber in it that allows it to cool so if you're in the sun or you're running you know you're running some heavy duty app um you're not going to get your phone's not going to be as hot anymore uh 50 more ram obviously that's important for ai and then they have a new chip that's designed with the llm transformer architecture in mind so the apple a series of chips.

49:08They've always been somewhat AI optimized, but more for just broader machine learning tasks. Now they're doing the same thing that OpenAI is doing with NVIDIA and Broadcom on chip design. Same thing that Google DeepMind TPU team is doing over at Google and Anthropics working with Amazon and Tranium. Here's my post introducing iPhone 4000, a newer, better iPhone that's lighter, faster, newer, and better. Where did this land? How many likes did this wind up getting? Six. Six thousand? Six thousand. And the funny story here, the little inside baseball, Jordy posted this exact post like five minutes earlier.

49:51Well, so I originally had this post as a draft, and then I altered it, and I posted it, and I had a different picture, and I did iPhone 472, and it was just completely flopping. It got like one like on like 300 impressions. Like people hated it. The timeline hated it. I just went back to this version, posted it, and then it completely ripped. So never give up. Never give up. If you think you have a good bit, never give up. But the funny thing here, I mean, obviously it is funny that Apple always comes out and it's like, it's our most powerful iPhone ever. Because it's like, well, if you guys messed up and accidentally created a less powerful iPhone, you would just keep selling the current one.

50:28You're never going to come out and be like, this year we're selling one. the latest iPhone, but it's less powerful because just sell the last one then just be like no new iPhone because we couldn't make it any more powerful. Yeah. We actually made it. We made it perfect. We made it perfect. So yeah. I mean, what are you, how are you feeling about the air? I think that's going to sell incredibly well. I don't know. I'll need to like feel it and, and, and, uh, and try it. I've never had any iPhone. That's not just like the biggest and most of the, like the, the biggest screen, the maxed out one.

50:59I've always gone for like the, the most power, the biggest one. I've actually considered carrying an iPad mini just as a phone because I'm so big that my pockets are big enough to carry an iPad mini. Yeah, no, no, I was feeling it. And I was like, you can get it with cell service. And so I think you can get a phone number on there. And so you can just have like pull out your giant iPad mini. But, but I never did that. I've always just stuck to like the pro max, the big one, the big screen, but it's, it's easy. Uh, the, uh, I don't know. The, the, the interesting thing about the, uh, the iPhone air was this, uh, you know, the whole computer is in the camera bump now.

51:41And basically everything that drops down is just battery and screen, battery and screen all the way down. Um, and so people are wondering like, uh, you know, they could clearly take out the battery and the screen and maybe make like a pin. Like they're, they're getting so good at miniaturizing, like what it means to be a computer, uh, that they can put that in all sorts of different things. I would be, would have been really excited to have an iPhone that doesn't, that will sit flat on a surface without a case on it. I haven't used cases in many years. I just like the feeling of the phone. It is crazy.

52:11It's so funny. That's just perpetually like on, you know, it just give me like a flat surface. Like I'm happy for the phone to be as thick as necessary to just give me a flat And it looked like they were going to do that with the iPhone pro because it has this wider notch. So at least if you did, if you did the notch evenly all the way across, if it's kind of like, yeah, that's fine, I guess. I don't know. But it's all, it's also so funny. The, the idea of like, you have this incredible camera and then you're just like putting it on, like, I really want you to buy a case. Like it's like a lot of the product design seems driven by I don't think that's the real, I don't think that's the real reason.

52:49I think it's, I think it's, I I think it's genuinely like people don't like heavy phones. And so you have to balance like you need the optics of a camera, the certain thickness, and then you need the phone to be thin so that people actually carry it around and aren't like, this thing's heavy. Tinfoil hat, yes, it's the case. I just don't think they make that much money. How much money do you think they make from cases? I mean, they're adding what percentage of people do you think when they go to that buy an iPhone, buy an Apple case? I would estimate that it's less than 1 % of their overall revenue.

53:20cases. Yeah. Totally. But you're talking to the goat of profit maximization, Tim Cook. There's just so many other ways. I feel like you can sell 1 % more iPhones if you actually choose this odd choice because people are like, well, yeah, it's the lightest iPhone. It's lighter than the Samsung one. It's thinner. It's lighter. It looks great. And then there might be something about like the notch kind of holding on your finger. And so you can actually hold the phone easier with that as opposed to if it was just like fully, fully smooth. Um, anyway, but, uh, yeah, I mean, when you start thinking of, uh, when you start like the, the incremental sales from, from like design driven decisions like this, I do think, I do think it'd be significant, but anyway, uh, huge keynote filmed on an iPhone, obviously a lot less graphics this time around.

54:14My take on the iPhone Pro was we're getting to the point where you could run an LLM on device. And even if it's not Apple intelligence through that API, just the ability to actually distill something that's like GPT-4 level and have it be free. Not even an API call that you need, not even cheap on a per token basis, but actually just have something that you can basically drag and drop. of the energy. Cost of the energy. And no one thinks about it because they charge on the edge because they charge their phone every night anyway. So I was talking to Tyler about this earlier. Try and put into context how powerful an LLM running on device could be with this next iPhone.

55:02Because currently people have done it. I feel like people have distilled models to the point where they can run locally on phones, but they're not fast or they're not smart. But it feels like we might be at a point where you get like to some sort of like touring, touring test passing plus not waiting forever. Chad is asking if it's Nico Rosberg. It is. It is Nico Rosberg. It is. The former F1 world champion. And now a capital allocator. Now a capital allocator. So yeah, Tyler, what is your take as this gets into people's hands? How solid do you think the actual interactions with LLMs could be on device?

55:40Yeah. So I think it's 12 gigabytes now, up from eight. So you can probably run a very solid 7 billion perimeter, not super quantized model. We've had those for a long time that are very solid. Obviously, they're going to pass Turing tests, whatever. Sure. You're probably not going to be using it for doing your hard physics homework. Yeah. but like most like things that you want from like a non-device model like helping look at your emails or like doing stuff that like you would think of like like a really good siri product would do yeah i think it's like totally capable of doing that um i mean it's like i don't think that apple intelligence was bad because the hardware was lacking it was like like i mean you can it'll be a little bit slower probably to run on cloud maybe um yeah i mean with my experience with apple intelligence was it was just just instantiated in very odd ways it was they they didn't really have like a killer app there uh and it was like a bunch of different things that kind of piped in and you could like highlight text and then just say rewrite this uh all sort of like very incremental gains summaries yeah oh the summary is botched but That might be the best feature, actually.

57:00Yeah, it's hilarious. It's a feature, not a bug. We just saw one in our group chat where I posted some fake news, and Apple summarizes it. Gabe says, shouldn't Tyler be back in school? Gabe, you must have missed the episode, but Tyler is riding with us. Yeah, and so I think there's something magical about getting the ability to inference a GPT-4 level model on the edge for free. Like you can quibble about the level of intelligence that is, but it is actually too cheap to meter because you won't even have to set up an API key. And so you can vend in a GPT-4 level model and then go viral and not have a bill show up and not need to think about monetization, not need to think about anything that's a drag on your just pure virality.

57:58You can have a free app that just grows and grows and grows and figure out the monetization later. And I feel like this sets us up for maybe something interesting to happen in consumer. We haven't really had that moment of, you remember the Lenza moment, the magic avatars, you upload your picture and it turns you into Superman or something. And then the Studio Ghibli moment, we haven't had that many like viral apps that are purely based on LLM interactions, like text interactions. There's been a couple, like there was one called like Generative Dungeon. Do you remember this? It was like a dungeon crawler text thing.

58:34So it would say like, you walk up to the dragon's lair. What do you want to do? And you could just type like, I brandish my sword. And then it would say like the dragon. That was like GPT2. Yeah, there was super low level, right? So imagine that plus like, but you can do it on device at a reasonable level and you can bring in some other UI elements from the iPhone, bring in the camera, bring in GPS, bring in all the other tools that are available just in the iOS, like Swift, like developer kits, the SDKs. I feel like there will be a ton of people that are just building cool, interesting things on the iPhone that could potentially like go viral and then become real businesses.

59:17yeah i don't think this will be that like meaningful for like apple intelligence because it's not like that's like a product issue it's not like a hardware issue but yeah i definitely think for like third-party developers this will be like pretty big yeah you can do like and you know if you make some random game you can now have like avatars or whatever yeah like if you make the sdk really easy where like it's very easy to inference lm you don't have to like figure out how to like download and then do inference and all that stuff if they like abstract that away yeah i think it could be interesting and i just feel like we've seen so many there's been so many companies we talked to some folks at demo day who are doing this where they were like we have this cool uh ai agent that like scrapes your emails and does this and it all is it all it's all predicated on you installing a mac app which is a really really hard thing to do whereas like yeah how many mac apps do you think you've installed this year oh it's super rare it's super rare uh uh, you know, I got something to put the decks together.

1:00:13Uh, like I literally have a Chrome, like that's the one I installed. I'm looking at my home row and it's like, it's just Chrome. And this is why everybody's obsessed with the browser. Truly, truly. Because if you can get people over there, then you're there. Um, but, but I have installed apps and I've installed little tiny apps. We were talking about the, the, the workout tracking app strong that I saw my friend to the gym. He was using an app to track his workouts. So what app is that? I went and downloaded it. You went and downloaded it. It was very easy for that app to like loosely go viral.

1:00:43And it's a free app, but it doesn't have any like AI. It doesn't really need any AI, but you, but you could imagine that the viral coefficient of, of someone downloads an app. They have a magical experience with some twist on top of an LLM, something storytelling, something astrology, who knows what it'll be. I can't predict it. It's as hard to predict as Instagram or Uber, but it's unlocked by having this, having this ability for free on the iPhone. And then people are sharing screenshots of, oh, I had this hilarious interaction or this was incredible, or I love this app. They create some viral loop.

1:01:18They do some Nikita beer type stuff. And then, and then everyone's downloading the app and then it gets actually really, really big. And I don't think it's going to be a competent. I don't think it's going to compete with chat GPT. I think it's going to be a completely different thing and it's very hard to predict, but, but it feels like we might be seeing it. Yeah. Yeah, and it's going to require some really cracked level of creativity like what we saw with Harry Potter Balenciaga, where it's like the technology existed and then someone came up with the great idea to actually go instantiate it.

1:01:48So if you're going to be walking that app up, you're going to do it in Figma.com. Think bigger, build faster. Figma helps design and development teams build great products together. You can get started for free. The Wall Street Journal was also covering the Apple's iPhone Air. they had a whole interview. They had really good coverage of the iPhone event. There was one thing in the reporting from the Wall Street Journal. I don't have this particular article actually, but they did an article with the Wall Street Journal and Apple revealed that I believe they said the majority of iPhones, 51 % or more, that are shipping to America are going to be made in India.

1:02:32And I'm not sure if it was this cycle, but it seemed like they were taking the tariff stuff really seriously, moving the actual manufacturing capacity around. Obviously, Foxconn, their manufacturer partner is a Taiwanese company, and so they're worried about geopolitical risk as well. And so just another data point around Tim Cook, he is not loudly shouting like, America, I'm all in, re-industrialized. But he is making moves. What was the number he threw out at the dinner last week? Wasn't it? I don't know if he had a number. Because who was it? It was Zuck had a number. And did Apple have a number too?

1:03:15That was 600 billion or something? Apple has thrown out a number at one point. You're completely right. My point is that we've seen a few data points. Oh, yeah. The number of thank yous is a lot. Um, but, but, but we've seen he's invested in, uh, in some semi, some rare earth, uh, developments in the United States and starting to think about manufacturing internationally. And, you know, the, the, the pro bullish bet on Tim Cook is that like, if he was able to set up this in China and he's the reason he can set it up somewhere else because he's the guy who did it. And so even though he hasn't been really loud about his moves, because obviously if he says like, oh, yeah, I'm not going to be manufacturing in China anymore, then like his important business partners over there are probably going to be like, well, yeah, like we're not going to take your business seriously anymore.

1:04:07There are a ton of different geopolitical considerations. Such an iconic line from the dinner. What does that look says? I've always enjoyed dinner and interacting. yeah if you're getting dinner this weekend with one of your boys just tell like how to say something that like no one can can't you know cancel you for it's like i've always enjoyed dinner and interacting two things i've enjoyed he's a dinner he's not saying i've always enjoyed dinner with you yep and interacting with you he's just saying i've always enjoyed dinner and acting. Incredible. Putting on a claim. I feel like for watching some of these, like I was watching the Tucker, Sam Altman interview, and there's a certain level of polish that some of these CEOs have when they get to a certain level of media training and public speaking experience where I think of them more as like word rotators than word cells or shape rotators.

1:05:02Like they can they can so quickly like shift a sentence to be like, like that, like so perfectly balanced where you're like, wow, every word in that sentence was calculated so that it's the rides, this perfect line. Like, uh, like Sam was going back and forth with Tucker and Tucker's like, I didn't accuse you. I didn't accuse you. And you, and if you run back the transcript, you're like, yeah, technically he didn't, it was not, it was not an accusation, but then, you know, they're, they're rotating the sentences around to try and like pin each other. It's like watching a wrestling match. It's crazy.

1:05:35Tim Cook said they would be investing$600 billion. $600 billion. Yeah. Okay. So Apple says the majority of iPhones shipped to the U.S. are now assembled in India, meaning they face no tariff, yet Indian suppliers aren't yet capable of delivering as many of the pro models that U.S. consumers demand. So most of those still come from China. So this is the majority of iPhones in total because Apple makes a ton of those, but they can't make the leading edge. And then the other thing that everyone always talks about with this, like assembled in India is not the same as fully manufactured in India. Obviously the advantage to Chinese manufacturing prowess is that you'll walk across the street and there's a CNC shop with 25 ,000 CNC machines that can just immediately make you any part and make a million of those parts if you need.

1:06:24So obviously, it's going to be a long road for them to set up manufacturing anywhere other than China, but it does seem like Tim Cook's taking it seriously. I would love to understand Tim's actual strategy here because I don't think he's saying, I'm going to invest. He's not going to be in a huge hurry to invest that 600 billion, right? He may, you know, he may not actually believe it's at all the right decision for Apple and he's just feeling like he needs to placate the admin. And then if, and then in 2028 comes around and he just, you know, can pull back or pull out. There's also like so much to 800, 600 billion of CapEx over what, five years or something like that, like that includes HQ, that includes data centers for iCloud that need to be local.

1:07:14If you're streaming the F1 movie on Apple TV +, you don't want that stream coming from a data center across the world necessarily. It needs to be cash locally. So there are like so many different pieces of the business building more Apple stores, like that counts as CapEx if they build them and they, you know, they're so 600 billion doesn't necessarily mean like, yes, Like we're building like the one plant because, you know, this is like a rainforest of complexity that actually delivers the iPhone. It's not just it's not just like one iPhone factory, please. It's like a whole network of things.

1:07:48Battery life appears to be a challenge for the air. Apple always says like all day battery life. But people are like, allegedly, what kind of all day are we talking? Are we talking scrolling for 18 hours? Are we talking proper scroll? Proper doom scroll. Apple announced a new battery accessory that will attach to the Air. And obviously, that's no longer as thin. The company added what it calls a plateau on the back of the Air and Pro models, adding thickness at the top of the device to fit bigger and hotter chips. Not a bump. It's a plateau. It's a plateau. Yeah. Oh, they're rebranding. Maybe they're signaling that we're, maybe this is Gartner hype cycle.

1:08:29I mean, they have plateaued in productivity for sure. The hype cycle, they've been through it. They're like, first hype cycle? First hype cycle? I've been here. I'm plateauing. I'm getting productive. OpenAI, the nonprofit, is going to control its for-profit arm and own equity valued at$100 billion. I believe this will make it the most highly valued nonprofit or like the most profitable nonprofit in world history. The best funded nonprofit, right? And it is remarkable to think about what that will be like. People have kind of written off the nonprofit as like, it's going away. Like it is not going away.

1:09:09Like it will continue to be a thing. It's incredibly back, funded forever, essentially, to do a ton of interesting things. I think we're going to see interesting things come out of that organization. But anyway, the news, this is from the journal and we'll break this down. But Nick has it summarized here. OpenAI LLC will be converted into a Delaware public benefit corporation. OpenAI nonprofit retains control of the new public benefit corporation. The nonprofit will hold$100 billion plus of equity in the public benefit corporation. The PBC structure enables raising large amounts of capital for the mission, which obviously they're already doing.

1:09:50They're still aligned with ensuring AGI benefits all of humanity. I think that's good. But also aligned with like your shareholders, like if you're just a normal C Corp, I know they're a public benefit corporation, but if you're just normal C Corp, like shareholders are humans. Let's make sure it benefits the shareholders that will by definition benefit humanity. But specifically they're saying all of humanity, even if you're not a shareholder, AGI should still benefit you, which was a noble cause. Um, opening on Microsoft signed a non-binding MOU, uh, for the next phase of the partnership, a definitive agreement is still being negotiated.

1:10:22OpenAI says it's engaging in California and Delaware. Remember, as it stands, Microsoft gets 20 % of OpenAI's revenue. For the big man. Something like that. Big man Satya. Something like that, which it felt like a stretch to me that that would be sustainable given the looming costs that OpenAI needs to incur. Obviously, they're ramping revenue really quickly. Yeah. But you have Broadcom to pay. You have Oracle to pay. You have all these. But it is kind of revenue. You know, it's not the same as being like, we're on the hook of$5 billion. Yeah, it's not a fixed cost. Exactly. But still, it's a lot of, you know, these companies are under margin pressure already.

1:11:04And wasn't the original deal that it would be 20 % up until they paid$100 billion or something like that? There was something where like it eventually ran its course. I believe it had an ending. And I think that's what's justifying a lot of the underwriting because the lesson from Google, the lesson from Facebook, the lesson from, uh, you know, Microsoft and the rest of the hyperscalers was that you needed your DCF models to be 20 or 30 years into the future. Right. Yeah. And so if you just, if you, if you didn't take into account the third decade of growth, you were undervalued. It was originally reported 20 % through 2030.

1:11:46Okay. which still is i don't think a lot of investors are scared by thinking about value in 2035 i think they're fine with that now i think they're saying like yeah i have a 10-year fund and realistically all the best venture investments spacex is still hanging out in the portfolio 20 years later they got continuation funds i think that a lot of investors are actually fine to say yeah this company is going to be like you know maybe a financial mess for 10 years but if i'm super confident it's going to be a money printing machine in 20 i'll do the deal all day yeah i think that's the right it's still insane to think that the deal ever got done in the first place because the microsoft deal yeah if you were if if you talked to a founder and they were like yeah i was running a fundraise and like you know ended up taking this deal i got the valuation i wanted but ultimately it gave up 20 of revenue off the top too so not 20 of like profits but like a 20 percent tax on gross revenue yeah uh just for the just till 2030 and the founder's like well it doesn't matter that much because i'm in this for like 20 years you're a thing most most companies do not get the pass on that yeah very few businesses very few businesses in the world especially like highly competitive you know categories uh can sustain a 20 tax off the top and still really produce any profits or be functioning at all.

1:13:09But obviously, profits are... What if your business is mobile games in the App Store? You've been paying Apple a 20%, 30 % tax off the top for everything. There's a bunch of examples. Like, NVIDIA could do this too, right? Yeah, yeah, yeah. And they sort of are through this kind of deal. I don't know. I mean, I agree with you. It is a crazy, crazy deal, unprecedented in a million ways. but everything about the entire OpenAI story is unprecedented. Yeah. Unprecedented to start as a nonprofit, unprecedented to have, who are the co-founders? Elon Musk, Peter Thiel. Like you have like seven different co-founders who have a bunch of co-founders have gone off and start direct competitors.

1:13:47That doesn't happen very often. Usually people are like, I got bags in the category. I'm going to go work on something else. Yeah. There's a bunch of weird stuff.