How 3 CEOs Use AI to Run $10B in Companies | This Week in AI

0:00Hey, it's Oliver from This Week in AI, the brand new podcast from the team at Twist. We're dropping a sneak peek right here in your feed to show you what we've been building. If you enjoy it, join the community at thisweekina.ai or find us on Spotify, Apple Podcasts, or YouTube. Like I was talking to a friend of mine, she's an accountant, and she told me accounting is never going to be replaced by automation. I'm like, what are you talking about? It's the first time we're really automating cognition as opposed to just automating the physical part of a job. 70 % of them think they'll have a decrease in job opportunities.

0:30Only 30 % of Americans are worried in the same poll about themselves, so they all think it's happening to somebody else. I do think that humans will want to play status games. I think we'll find other jobs. I think we'll probably be doing less numerical and logical jobs. It feels like something very big is coming. The world doesn't appreciate that it's happening because most people are not very good at asking questions. You can taste the singularity at this point. I can't even imagine the end of this year is going to be shocking. Thanks to our friends at PayPal, the exclusive sponsor for This Week in AI.

1:02Try the payment and growth platform that's trusted by millions of customers worldwide. PayPal Open. Start growing today at paypalopen.com. All right, everybody. Welcome back to Not This Week in Startups, Not All In. This is a new roundtable I'm doing. It's called This Week in AI. It's in the name, folks. Every week, three amazing CEOs, just like on All In or the VC roundtable we do over at Twist. three amazing CEOs who are actually building the future and me, an investor in the space and an entrepreneur, talk about the week's issues and sometimes the bigger picture issues. You can find out more about the podcast thisweekina.ai.

1:39Or if you want to see the YouTube channel, thisweekina.ai.ai slash YouTube. And this is our seventh episode. It's March 31st, 2026. Three amazing guests with us today. Jeremy Frankel is here. He's the CEO and co-founder of Fundamental. They're building large tabular models for enterprises. They emerged from stealth as a unicorn just 16 months after founding$255 million Series A, led by Oak with participation from Valor Battery, Salesforce, and more. Welcome to the program, Jeremy Frankel. So, Jeremy, explain what your company is doing and how it's going so far. Things are going great. So, what we are doing is we built a foundation model for tabular data.

2:26So, what does that mean? So, when people think about the AI boom or the AI revolution, everyone is thinking about LLMs. And for good reason, right? Like, you know, ChatGPT, like, you know, a creative breakthrough where, like, you know, you can now, you pre-trained one model on the entire internet and you understand language. and you can use it to power thousands of use cases. But what's less appreciated is that LLMs really mostly solves unstructured data issues, such as text, audio, video, images, coding, but they really didn't impact structural data. And structural data means everything that comes in rows and columns.

3:05So think about spreadsheets, databases, CRMs, ERPs. It's all rows and columns, and that's the vast majority of useful data for enterprises. And that part of the enterprise has never had its Chargipty moment. And so this is the modality we're going after. And for a variety of reasons, it's the one modality that acts very differently than others. And what we're building is really the Chargipty moment for tabular data. So if I can repeat it back to you to make sure I understand this vision, it's what I always like to do with founders, is see if I can repeat it back. You have large language models.

3:45Those are built, as we all know, like Guess the Next Word and Transformers. It's based on massive corpuses of text-based data, generally speaking. You're building an LLM to focus specifically on tables and tabular data structures that we all know as a, you know, might experience an Excel sheet or a database, a Notion database, you know, a SQL database. Am I correct? So it's not an LLM, it's a large tableau model. So it has a very different architecture than LLMs. Basically, if you look at the LLMs, as you said, they're built on being next token predictors, right? It's an autoregressive model. The problem with that is that if you look at the way transformers, for example, are applied to LLMs, they have a positional encoding as part of it.

4:32So like the order of the sentence matter, right? If you change the orders of your sentence in cloud or you can get a different output. But with tables, you actually don't want that. And the reason why is imagine if you have a table with a million patients and you try and predict which one of them have cancer. And your first column has the weight of the patient and your second column has the heart rate of the patients. If you switch the order of those columns and you first list the heart rate and then the weight, you shouldn't expect or you wouldn't want to expect a different output. But with LLMs, if you change the order of the data, you get a different output.

5:08And that's fine when you're writing an email. It's not fine when you look at the deterministic outputs. And so that's what we've focused on. Got it. So large tabular model and LTM is how they're first. Are you the first people to do this or is this like a known alternative to an LLM? It's very nascent. There are a few smaller companies working on it as well, more in an academic environment, an academic setting, but we are the first large company doing that at an enterprise scale. What is the benefit here? Is it because you'll have a better fidelity, better results, more trustable results than the problem we have with hallucinations in large language models?

5:49Would that be the reason to do this? It's very different use cases. So if you look at everything in the economy, for example, every time you swipe your credit card, one of the credit card providers has to make a split second decision of whether the transaction is fraudulent or not. When you work with retail, for example, forecasting demand, all of those, or like, for example, if you order an Uber, Uber has to make a prediction on the ETF of your driver. Each one of those stars is tabular by nature and it's predictive. But when you look at the way those predictions are being made, they still rely on traditional machine learning algorithms that predate LLMs.

6:26And those algorithms still do better than most LLMs at making those predictions. And so what we've built is a model that can essentially unify all of those use cases into one model to allow you to make much more accurate predictions than what you would otherwise be able to make. Genius. So the company is named Fundamental, and your flagship model, the LTM, large tabular model, is called Nexus. Am I correct there? Correct. Correct. All right. And we just had Perplexity CEO Aravind, who's really crushing it. He's one of your angels, huh? Correct. Awesome. Victor Riparbelli, I got your name correct, I hope.

7:03You did. Riparbelli. Welcome back to the program. You're with Synesthesia? Synesthesia. Synesthesia. S-Y-N-T-H-E-S-I-A You're an AI video platform for business. 90 % of Fortune 100 companies are customers already. Over$100 million in ARR. And you've raised over$500 million. $4 billion valuation. And we're seeing an incredible demo here. Explain to us how you're different. Nano Banana, the free services out there. ChatGPT's image generation. and why you exist as a company dedicated to just working on video models? So I think we started the company in 2017, way before any AI video tech actually worked.

7:49So we've been quite a bunch of different companies all the way up to 2026. What we decided on five years ago was we're kind of looking at the early iterations of AI video, which is the models that we're seeing right now, like Vio, Sora, which just been discontinued, our models. Obviously, very high fidelity, fairly inexpensive to run, assuming you're just creating single videos, and really getting to the point where you actually can't tell the difference, which unlocks a whole bunch of new use cases. But what we figured out five years ago was that the first iteration of this technology was not ready for prime time.

8:22It would definitely not make a Hollywood film. It would definitely not make performance marketing ads. But there was a very real use case in taking all the world's PowerPoint users and enabling them to communicate in video as opposed to slide decks or documents, which in 2022, when we launched the first product, was what everybody wants. People want to watch and listen to their content. They don't want to read that much anymore. And we essentially provide a way for PowerPoint creators to very easily switch to making video and stuff. And that has worked really, really well. And today, we both have our own models.

8:54We build voice models. We build video models. We have interactive models. So, Avantage, we can actually talk to in real time. That's launching very soon. And then we also use a mix of the big models from some of the bigger providers to solve some work for our customers. And for folks who want to hear from you, three years ago, we had you on This Week in Startups as part of our next Unicorn series, Before You Were a Unicorn, episode 1776. What a great episode number to have. uh why did chat gpt open ai shut down sora and why is elon doubling down on video he's been very vocal just this week talking about how video is the most important thing take us through your take on that obviously you were in video years before chat gpt was even launched i mean i think it's kind of interesting that even a company like open ai found by like some of the smartest people in the valley, right?

9:51Like, so those accomplished people still had to learn the lesson of, like, focus. You know, it's kind of, I think, I feel like it's one of those, like, unteachable lessons that they had to learn the hard way. I think it's very obvious to anyone looking at the way that Anthropic is ripping right now that CodeGen is probably the most valuable near-term use case for all these technologies. And I think OpenAI probably had a little bit of flying too close to the sun moment where it decided to do, like, absolutely everything all at once, right? Which often in the PowerPoint, it sounds doable but in reality I think I don't anyone who's run a business knows that doing too many things at once is like rarely a really good idea and Fropic focused on no voice models no video models just like code gen b2b no freemium and that has clearly paid off really well for them so I think my take on what's going on in OpenAI is that they're like let's cut all the side quests and focus on the market that's really really going to matter and I think that's going to be probably screwing multiple B2B and it's going to be heavy on CodeGen and powering just this like campaign explosion of a product that we're seeing being built with the bike coding right now.

10:56I guess Claude's got people shaking. They've done, or specifically, it's got OpenAI shaking. They've added so much revenue. They've become such a darling. Jeremy, I see you smiling about this. This has become notable in the industry. Yeah, Jeremy? No, correct. Correct. I mean, it's funny. I was at the founder retreat a few weeks ago, and everyone was just talking about Claude Code. No one was mentioning anything else than Claude Code. What founder retreat was this? It was a Lightspeed event. Ah, Lightspeed. Okay, the Venture Caliber firm. And that's fascinating. Nick Harris is back in the This Weekend family you were on this week in startups.

11:33I remember this discussion August of 2023 as well, episode 1787. And so we got it right having you guys on early. And we were talking about, and you were predicting just how important these data centers were, and that photonics, using light instead of electricity to connect AI chips, would be critically important. And you explained to me, back on that program, Nick, that energy and data centers were going to be a major, major issue. And here we are three years later. Energy is the bottleneck, isn't it, Nick? Yeah, it's exactly the bottleneck. You know, as a company, we've been focused on driving the future of computing.

12:16The central challenge that we're solving at Light Matter is around how do you create a new roadmap for Moore's Law, for Denard's scaling? These are rules that drove computing progress for our entire lives. I think about being a kid in the 90s and every 18 months, you get an incredible new chip, more performance, all these things. That's over now. And there's only two ways that computers get better at this point. One is big computer chips. You put more chips in a package, computer chips are getting to the point where, you know, NVIDIA sells nearly$100 ,000 chips. So those chips are getting really big and the size of the chip is going to keep growing.

12:51And the other way is that at any given time, there's a biggest chip you can build. So networking them together is the other piece. So big chips network together. This is the future of computing. It's the new Moore's law. And we power both of these with our product passage. And we also, since we spoke last, started building lasers, which I never thought we would get into. But when you look at the photonics revolution, what's interesting is that you've got this device that powers all of the communication for these AI supercomputers. and it relies on the laser. It's kind of like batteries for electric vehicles.

13:28It's a really fundamental, huge part of the bomb and it drives all the progress in how these computers are going to connect. One of the cool things to tie into the software piece of this is with photonic technology, we've shown in research and so on that you can actually 3x time to train. If you guys are watching Anthropic and their incredible tear, I'm hearing about the new model Mythos that's coming out. we can actually 3x faster time to train. Imagine if you have PE to the RT, where you've got R times three now. So the rate of takeoff is going to go up like crazy. The first companies that adopt this photonic technology for linking up GPUs and AI data centers, the foundation companies, they're going to have an enormous advantage.

14:13Got it. And for the audience, again, my typical technique of repeating back so we all understand what you're doing, Nick, at Light Matter. Ethernet, cables, that's how we connect computers typically. Obviously, consumers are using Wi-Fi. You would never use that because it's very limited bandwidth. But Ethernet, which is typically copper wrapped in plastic versus photonics, which would be made of glass, I'm assuming here, and fiber optics. Yes. And the throughput is radically different. Maybe you could explain that and give us a bit of a primer and then you could sportscast what we are seeing on the screen.

14:49Right now, the way that AI supercomputers are built, you think about NVL 72 from NVIDIA, they take 72 GPUs and they link them all together in a very high bandwidth domain. So here we're talking about petabit per second bandwidths within a rack. That's all linked together in copper. What's really interesting about copper is it can't go very far. The cables have to be quite short. And so what you're seeing is the racks are getting packed as tight as possible. Now people are building racks that are a megawatt. So you have a rack that's a megawatt. You have to reinforce the concrete below it because it's so heavy that it's actually a load on the infrastructure.

15:25And you're building these custom racks that are just for delivering the cooling to these systems. That's kind of where people are at today. And the reason they're there is you have to bring the density because the copper can't reach very far. So just to give you an example of the Delta and what we do, we just announced a chip with Qualcomm where with each glass fiber, we're packing 16 wavelengths of light, and we're pushing 1.6 terabits over a single optical fiber. That bandwidth is crazy. It's like 1 ,600 houses worth of internet. A normal house has one gig internet, so 1 ,600 houses. So copper really doesn't have very much reach.

16:04And the reason it matters is when you're building these AI supercomputers, if you want to have great performance, you want to link as many GPUs as you can tightly together. If you have optics like what we do, you don't need to put it all in one rack. You can separate it by a kilometer. It travels at the speed of light. There's very little loss in the optical fiber. And you can build giant systems that act like a single brain rather than a bunch of mini brains with 72 GPUs talking in parallel. You could have thousands of GPUs working together on a workload. It drives interactivity, drives time to train.

16:39Both inference and training get a huge benefit out of switching from copper to optics. And we're kind of the leader in performance in this space. And just so people can conceive of a pet a bit, you're talking about thousands of 4K movies from, you know, coming from Netflix every second. So this and probably a hundred million high res photos from your camera, your library per second. So if you had a hundred, if we as consumers had a hundred million photos somehow in our photo libraries, Victor, you could be sending just, you know, hundreds of people's photo libraries, the entire, you could send the entire corpus of Netflix movies in 10 seconds.

17:26Yes, Nick? Yeah, exactly. And there's a kind of a cool analogy here. We have the chip M1000 that we announced last year, that chip is 114 terabit per second. So that's 114 ,000 gigabit per second. That's 114 ,000 houses worth of bandwidth. And a more interesting comparison is that that is about the bandwidth of the cables that connect North America to Europe for the internet, the undersea optical cables. So we're building chips that have just an obscene amount of bandwidth And it's all needed to drive AI scaling. Jeremy or Victor, in terms of your data usage, when you hear about light matter and the impact it could have, what goes through your mind, Victor?

18:08You know, because obviously you're working in video and your data centers. I'm not sure what your standard platform is and where you host, but maybe thinking ahead to the future, how do you think about what Nick is building? I think it's super exciting. So there's kind of two big ideas we found on Synthesia. The first one was like, as AI increasingly can generate data, the marginal cost of creating video, audio, all the other content has got dropped to zero, right? Both the dollars, both very much in time required and skills required. I think we're in the middle of that right now. But this is still video as we know it today.

18:40It's a broadcast medium. You make one video, you put it on YouTube, and everybody watches exactly the same version of it. The second part of our thesis was always around, when we invent new technologies as humans, we always invent new media formats that are native to those technologies, like they have a podcast or TikTok video wouldn't exist without modern technology. And for us, the big question is like, what does video look like if you were to reinvent it in 2026 with all the new primes we have around us, right? We have LLMs with essentially intelligence on tap. We have offline video models that can create extremely high quality content.

19:14We have real-time video models that you can interact with, advertisers you can talk to, canvases that can be drawn in real time and a whole bunch of other like cool technologies around it. And so what we're building for and what we're actually launching, it's in private beta right now, launching in a couple of months is real time video, which is the idea that if you, if to take one of our use cases, if you're a salesperson and you're doing a bunch of training to understand like the competitive landscape or new product that you're launching, instead of just like receiving a video that you sit down and then you watch it and then, you know, you hope you understand it, it's got to be an interactive experience.

19:48It's going to be maybe first to consume some content. You go into an agent, you role play with it. It pretends to be a customer. You have to answer questions, overcome objections. Then you go to another thing where we actually in real time draw a diagram of a customer's potential tech stack, how you've got to work with this, how you're going to integrate it. That's a very different type of video, which is almost closer to maybe like a game or a website or something like that. But one of the bottlenecks here is, of course, that if we're actually going to do this with video and we're going to do this with avatar models and we're going to draw things real time, that's going to take up a lot more bandwidth.

20:21It's also going to have much high inference costs. And so the more we can reduce these, the more accessible this becomes. So I think in the next couple of years, we'll see this becoming a new type of interface that's going to emerge. But for it to really take off and just be every interaction we have with the computer could be done with technology like this, we need the cost of serving that content to drop very significantly. I think that's the core of what the problem Nick's working on. So I think it's very exciting. Nick, when we have this ready for Victor to experience it, and we could probably do a deal right now that he could be one of your beta customers, because it would be amazing for Disney.

20:58I mean, I'm thinking in a consumer mind frame to sort of help the audience follow along here. But imagine Disney releases Mandalorian, and they had done a deal with Sora to try to get the IP to work. Now imagine with Light Matter being able to enable Victor's company to be able to make a short film with Grogu and the Mandalorian, and you're talking to them in real time, and it's making that in real time. That's just... Yeah, that's absolutely... And to put some economics on that, right, I think, you know, if you were to do that today, let's say you were to like personalize like a one-hour movie for a kid from Disney, that would cost you a lot of money, right?

21:38If you say an eight-second clip with a state-of-the-art video model costs like$1 or$2 a day, you're going to add that up for an hour of eight-second clips, right? That's not going to be sustainable within$15 per month. It'll be, yeah, if it was$6 a minute, if we just made it like$6 a minute, 120 a minute, you're talking about$700 for a custom movie that you can live in. Exactly. And we're not that many years ahead of like, I remember when I was a kid, right? And I had to like call my dad and ask him if I could download like a 10 megabyte file because it was like ADSL and you were like mirrored how much you would download.

22:11The idea of doing a video call for an hour with someone across the world, like that's an absolutely ludicrous idea, right? But probably in like X amount of years, this is going to be like completely normal. We're going to be just generating content in real time in front of people. And we're going to be able to offer that at like, you know, within the subscriptions that these services charge today. Nick, you were going to add this. Yeah, we're actually busy building chips for a bunch of companies. We typically work with hyperscalers to build their own chips. Think about like the Google, Amazon, Microsoft, Meta type companies who are building their own hardware to do both training and inference.

22:44And then we also work with semiconductor companies, both GPU companies as well as networking companies. So those are the people we build for. We're building a ton of chips right now. So I would say in the next year and two years, you're going to start running on light matter hardware. These will be in the new data centers. Think about like the Texas stuff. Yeah, CoreWeave. What's the one? Not Star Bay, Stargate. Another great film. Speaking of film. Yes, excellent film. Yeah. And so there's a picture of, I think that's Stargate. And what you see in the middle is that plus, I think is, I think I was talking to Jensen or the CEO of CoreWeave about this.

23:23Somebody on my team will tell me. I believe this is CoreWeave's data center. You have the cooling there, that bottom line that looks like memory chips in a motherboard. These are starting, these data centers are starting to look like giant motherboards. But I think those are the cooling apparatus where the contained water system, what do they call it? Closed loop water system? Closed loop. Yeah, closed loop water system. So that was Crusoe's data center. I remember the CEO was walking me through it on a previous episode. That's the closed loop water system and the data exchange. pretty compelling stuff.

23:59Jeremy, when you look at all this, oh, by the way, Nick, Amazon making their own chips, and I don't know if they're a customer, if they were, you could say so, but you gave us the sort of like, Amazons are called Tranium for training AI models and Inferentia for running inference models. Somebody at Amazon needs to go to branding school that's a little too on the nose training and inferential i mean what did they do they asked chad gpt to come up with names um but these are going to be dedicated chips and i think broadcom generally builds people their chips is that typically what happens so if we explain it to the audience you have nvidia they work with tsmc they're making their own chip sets they're the leader of the pack every single other hyperscaler uh tensors from amazon tensors from google yeah then you have these infrantia trinium and mtia from meta mtia from meta so explain to the audience why people are doing two different supply chains nick and then we'll get to you jeremy on your thoughts on this next wave uh well i mean how that'll affect your business yeah if If you look at the incredible spend, I mean, they're over 100 billion a year.

25:15They're like 180 billion a year, I think is what Google announced they spent. I think Amazon was over 200 billion for the year. When you're spending that kind of money, developing your own custom silicon is a little bit of a rounding error. So I think that they're really looking at these costs. They're trying to figure out how they can optimize cost. And they think they can build their own solutions. Now, building a chip is one thing, but building all the software and the ecosystem around it is another. And that's where NVIDIA has had decades of experience building out the moat there with CUDA and everything.

25:46But everyone's trying to build these chips. And the reason is that it's a race on the infrastructure point. People are trying to get power. They're investing in these micro nuclear reactors to go power the data centers, 100 megawatts each. So you get 10 of those and you've got a gigawatt data center. They're working on that power delivery. They're working on building the chips. They do their own, you know, these hyperscalers are becoming like very heavy duty infrastructure players from cement to energy, all the way to chips. And obviously the software stuff on top. There's just so much money in this space that they're all kind of making the bet on doing it themselves.