If the AI Money Dries Up, Which Companies Burn?

0:00You cannot sustain these businesses on anything other than an exuberant market. If that goes away, this s*** learns. In today's episode, our first debate. Is there a safe path ahead for tech companies that incur massive AI inference bills? Case in point, this year Harvey, the AI legal startup, doubled its revenue while its gross margin tanked. Is this a reasonable growth model or a dead end for all but a privileged few companies? Yeah, but you're at negative 50 % margins, you don't have a business. Also on deck, what can we learn about current sky-high valuations from past experience? AJ tells the story of how his business got funded at 100x multiple in 2021, and what happened after the hype died.

0:40Plus, if you've got equity in a tech company, we explore how paths to liquidity are changing and what that means for you. I sat down with a CEO. Her business is doing super well. $50 to$100 million ARR. If they wanted to go sell their business, they wouldn't. If your company is building with AI, this episode's for you. Welcome to Topline.

1:27Bruno, CEO of Quotopath, the leader in incentive compensation design, performance management, and expectation setting platform suite of products ecosystem. They're the best. Quotopath is the best. They're all with me. And we are going to talk about three topics. We're going to talk about the math of AI. We're going to talk about deal activity and what it means for you as a technology professional. And we're going to unpack what just happened in Boston, Massachusetts at Unbound, where A.J. Bruno was our man on the street. Boots on the ground. Boots on the ground. Boots on the ground, feet in the gutter, head in the sky.

2:03So I'm going to take it off. We're going to talk about margins. Here's my lead in. For the last two decades, software investors were trained to see gross margin as almost a law of nature. The median SaaS company generated gross margins in the mid-70s, while the best exceeded 85%. In 2025, Palantir produced 82 % gap gross margin while growing 56%. That was the magic of SaaS, although Palantir is questionably probably not SaaS. But the point is, once you built, so my example there is not relevant. Thank you, ChatJPT. Well, actually, though, to be fair to that ChatJPT response, Palantir says that all of their costs actually are in the software.

2:45They do this on purpose so that they can have those type of margins. Right, right, right, right. Because all the FD, all the forward deployed stuff would be in SG &A would be below the line. So there you go. All right. AI changes the equation. I've been talking about this a lot. Every prompt document, blah, blah, blah. Every time you consume a token, you get different margins. So Iconic found that scaling AI companies averaged roughly 41 % gross margins in 2024, 45 % in 2025, and a projected 52 % in 2026, which is a far cry from the 90 % that we were told SaaS should have. At the application layer, margins are even lower, 33, 38, and a projected 45%.

3:24But surely, Sam, Harvey did really well. Harvey's crushing it in margins. Harvey is the most striking example here. In 2026, the company began with gross margins around positive 50%. But in June, and this is as of yesterday, we learned this information, By June, Harvey's gross margin due to rapid agentic adoption, agents going out and consuming tokens on behalf of their human users, Harvey's gross margin had fallen to negative 50%. Negative 50%. That means it's cost. Negative? Yes. You said negative, right? I said negative. That means its cost to deliver$1 of revenue went from 50 cents to$1.50.

4:08Now, Harvey was growing extraordinarily quickly, but every dollar of revenue was destroying gross profit. So we're here to talk about what are the thresholds of growth. In the past on this show, Asad has said, people are saying. So Asad has sort of repeated back, but he hasn't said it's his opinion. He has said this is what he's hearing. He's hearing that people don't care about gross margins. People are saying it doesn't matter. VCs, you look at Jason Lemkin and you look at all of the famous people and they're going to tell you growth is the only thing that's important. Harry Stebbings doesn't probably know how to calculate gross margin, but he does know how to calculate revenue growth rate.

4:43So here's what I'm going to say as a straw man, and then I'd love to hear what my friends say. Above 200 % growth, I can tolerate bad margins temporarily. If you can show me you have a path to a good business. If you show me that you're subsidizing something, if you're trying to gain market share, and you're growing extremely quickly to justify that, I'm okay putting up with your terrible margins. But I need to see the path. Harvey's path, by the way, is building their own, training their own models, hosting their own models, building open weight models, and moving away from using state-of-the-art models that are built by the leading frontier labs like Anthropic and OBI.

5:18So if you're above 200%, I just saw today on LinkedIn, Pat4K at Lagor was saying they grew, they went from 100 to 206 months. Okay, if you're doing that, who cares about gross margins? Okay, but if you're growing less than 200%, if you're between 100 and 200%, I want to see a clear improving trajectory. If you're below 50 % growth rate, I need your margins to be good. Gentlemen, please react to my straw man. You know what's interesting is when people say our solution is moving away from the best models in the world to these open weight models, and they use a bunch of words to make it sound fancy.

5:55We're training them, we're doing this, we're doing that. But it's like going from hiring people only from Harvard to then going and hiring people from the worst university you can find or some mid-tier university and saying it's the same thing. It's not the same thing. Like you're the models that come out of open it, like Astra is the world's best model right now. And it's so good that using Claude consistently for six months and not having signed into ChatGPT for quite some time, I started using it a few days ago and I haven't gone back to Claude since. Even though all of my work was in Claude, I haven't gone back.

6:34I find that it's like, I was telling Sam this before the pod, it's like using Claude now feels like I have an iPhone, but I also have an iPod. Like it's kind of retro and cool, but it's kind of weird as well. Whereas ChatGPT feels like the future right now. And it'll grow, it'll oscillate. But that's the best model. And so if you're a law firm that is, again, trying to do deterministic at work with probabilistic technology, I don't know how excited you are that you don't get access to the very best models. And so that is, I think, let me ask you a question. If you're pitching STA, how often do you win the pitch where you say, listen, I'm not going to be working on this search, but I've hired a guy.

7:19He did pretty well. He wasn't, he's not brilliant. He's not the sharpest pencil in the box. He graduated from Delaware Community College. Magna cum laude, 20, 20, 24. Benefit to you is not, there is no benefit, but the benefit to me is I can make money. I can make more money. Finally, I get to make a penny. Let's give this a shot. Let's see how it grows. And it's just, so I think this pressure on gross margins then sustains because your customer wants the most that they can get out of AI, your job is to use the intelligence and build product on top of that intelligence to help the customer get the ROI.

7:59And I don't think these customers that sit in investment banks and private equity firms and law firms are going to be looking to not have the very best potential ROI, which means you're going to find yourself forced to use these models to serve your customer. And in that case, you have pretty ongoing gross margin concerns in these organizations, which I think is very concerning, number one. The second point I'd make is you're also then completely at the behest of these model companies. Like if they decide to provide you a cheap model, like OpenAI is using pricing to capture market share, you're in a good spot.

8:41Your business looks good. And if they feel like they don't need to do that in that particular moment, they can just like capitalize on price as much as they want and you're screwed. It's a tough situation for the application layer. Asad, it's so interesting you say, because I fully agree with it. Do you think there's a calculus on the customer side when they get these answers back from these open weight models, when they look at it, that they do their own evals with Astra or with Claude in the same way? And do a lot of them just say like, wait, all we're getting is the application layer for Harvey or whatever this thing is.

9:18Why? Product matters. It really does matter. Sam, you and I were just having this conversation that using ChatGP versus Claude, it feels that the product is better. The intelligence is better, but the product's also better. And so I think product matters when you're looking at domains where there's just a lot of institutional knowledge that has to be extracted and then converted into workflows and create these integrations into all the supporting infrastructure to get the context, get the data, get all of that so that this thing is really powerful and usable for these people. I think that really matters.

9:55I think there would be great application layer businesses, but these are not the same sort of application layer businesses of the sort that we're used to. Like when you think of an application layer business at some sort of sizable scale, you think of like a level of stability, I think a steady eddy type of business in a way that these are not, this is a rollercoaster at scale. This is a rollercoaster. If you're losing 50 cents on every dollar that you sell, then going from, and I'm sure Lagor is a great product. I mean, I'm not sure to be honest. I don't have any of us talk to lawyers that actually use any, most of the lawyers I talk to our old fuddy-duddies that say, oh, you know, AI can be wrong sometimes.

10:37So one of my board's members' husband works at Harvey, but he was a former corporate lawyer. He says it's great. I just find it interesting he was a former corporate lawyer. He sold 20 million of secondary. He thinks everything's going to be very long. It's the best thing ever. But he has a disclaimer at the bottom that you have to sign to say it's a very long... Anyway, it's just interesting to see that they are hiring true corporate lawyers There's lawyers that have like kind of, I don't want to say like burnt out from practicing law. And I'm not saying that's the case in this situation. They're like, I want to get into tech hiring that.

11:11I mean, it's almost the compass type of business model. And that, I don't know if you, what you're ultimately seeing is, can they take all this domain expertise and apply it to a really complicated, an area where none of us would say that you could automate law. Like none of us think that. I've gotten the 42-page BS, like, we're going to sue you, chatGPT, AI noise BS spam email. And you look at that and you're like, that's nothing. And so it will be really interesting to see. I don't know anyone that uses Harvey personally, though. Do either of you? Yeah, no. I've heard very good things about the technology.

11:54Yeah, you do hear from lawyers that this is powerful. Again, going 100 to 200 billion is one thing if you had 90 % gross margins. But if you're losing 50 cents, then it means that you actually just lost$150 million, at least in Harvey's old construct. Obviously, they change things around so that they're using cheaper models. Do the cheaper models just flip that gross margin? Is that what happens? It goes from minus 50 % to 50 % overnight because of the model? If they set up an infrastructure right, there's a bunch of implementation costs moving to their own cloud and all this other stuff. But yeah, it should.

12:28But then the counterbalance is, does it lead to worse results for the customer? And then your usage drops. Because in one case, you could argue that in these moments on this roller coaster of, if an application layer of business is like riding a wild roller coaster, there's sometimes where you're going to be up here, your gross margins are great, revenue is flying. Sometimes a new model comes out that's super intelligent and your usage flies, but your gross margins fall. And then you have to like learn how to balance that out. But the thing you would, you would probably go to your investors and be like, listen, gross margins really bad.

13:05But check this out. Check the usage that we're getting right now. And you know, investors, momentum traders, that this is eventually the models get cheaper. and so this will figure itself out. I'll need a little bit more money from you but this will figure itself out. But check the usage out. See if this continues. Imagine a smarter model from here on out and that's basically the game that everyone is playing and I don't disagree with the game. I think that is the game on the field. What I think it does mean is that there's a level of, I think, sensitivity in the ecosystem system that we really need a lot of things to go right for this sort of thing to not blow apart.

13:49Because if we hit some sort of, not a speed bump, but like an actual crater, there's a lot that's going to fall. Because you cannot sustain these businesses on anything other than an exuberant market and the downstream risk that people have been able to take with that exuberance in their mind fueling them. If that goes away, this shit learns. Asad, one argument is open AI and Anthropic and maybe SpaceX are so important to the ecosystem that we need to sustain the economics of them reselling or selling tokens at a very expensive rate. We need them to be able to pass that cost onto the consumer.

14:32And in that world, open weight models, anything that jeopardizes is actually the economics of the frontier labs is itself. For example, if you can start running small language models instead of large language models on a bunch of use cases that before you thought you needed Astra for, and all of a sudden, instead of having to pay$100 ,000 a month or$1 million a month to open AI, you are paying zero. And you're running a small model on your own tiny little AWS cluster or even on your own machine. and so your gross margins go significantly up as the end user application layer but on the frontier lab uh side of things it it puts such pressure on their economics that that becomes the deflationary event that takes the air out of the entire uh system what needs to happen is it that we need to keep using as much expensive ai as possible all through the supply chain and then delivering an ROI on what we would consider to be premium tokens versus just generalized AI adoption, maybe from cheaper models or open-weight models that doesn't flow ultimately to the benefit of the Frontier Labs and NVIDIA and chip manufacturers and electricity producers?

15:55Well, the open-weight models definitely benefit NVIDIA equally. Well, not equally, but quite a lot. because they're still using the chips that NVIDIA makes to train them and then to provide inference on them. So NVIDIA is a winner on both sides, which is why NVIDIA is so supportive of the open source community. I think, listen, open source is going to definitely become a bigger and bigger part of the ecosystem. But open source is six months behind the frontier quite consistently. And a lot of the open source, most advanced open source models seem to be highly distilled from the best models out there right now.

16:39And so if that's the case, there's always going to be this lag. Up till now, we have not seen an open source model that has come out and leapfrogged the very best. They can catch up to the very best. They can be competitive. And then a minute later, OpenAI and Anthropic release what is the very best that they've been holding on to. So there's this gap of six months. And so you ask yourself that, is there going to be stuff that we use AI for that you don't need the world's smartest model? Yes, but that's not the exciting promise of AI. The exciting promise of AI is a data center full of geniuses.

17:16And so I want a data center full of geniuses in every function of my business trying to move the needle for us. And I think that's the big promise, which means the only thing, I don't think that people are going to move all their workloads over to open source, because I think if you have Astra and then you have something that's 25 % less effective and you have an important workflow, the one that you allocate value to being solved and you're willing to pay for, you will use Astra. So the only thing that reduces the price of these models is us building more and more data centers. It's a supply and demand thing.

17:58Demand is going to be there. The only way for price to come down is if supply starts increasing. and we have so much resistance in the United States right now to building data centers that we're just putting ourselves in a situation where we are not building the infrastructure required for the amount of inference we need to do. And so price will remain high till we figure that out. And these companies have been horrible at doing that, at getting communities to lean into this. I'm getting out of my depth on this, but I'm curious because you've done a lot of research on it. And like, how close are we to it?

18:29I guess like November is going to probably tell us a lot because there'll be a whole new crop of government officials that will help shepherd this in. But it does seem like there's just a massive on every side negative sentiment around building anything new. But what you're describing in this neocloud world, which is like you have you're moving. A lot of these companies are moving on prem to build their own models. That seems a lot more tenable. like we are actually a lot more we're a lot closer to these organizations because you don't need as much energy for those right or no is it yeah but you want a data center full of geniuses doing stuff in your business you don't want the person from some community program that did like you know after hours studied you know it's just i don't think that's the exciting part of ai is the less is the technology that is at the middle of the bar like you think about where you are willing to spend money.

19:24So if we run this thought exercise, maybe the better way to say it is this. Think about what you'd be willing to spend a million dollars on in the next 12 months on AI. What are the things it could do for you for which you're like, I'll spend a million on that. I'll find a million to spend. It'd have to really work and it would have to completely change the company. And it would have to do things that are really like valuable in your business, right? Right. Yes. Right. That you can trust. And you'd have to trust that it did it correctly. Yes. If you believed in this long one mind, right? Like you have to believe that the AI can run a sales cycle start to finish for anything under$20 ,000, maybe 50.

20:02And they'll do it really well. And you can give it all of these things that are the equivalent of that particular task that you mentioned, and you will find a million dollars to spend on it. So that's the way to think about this is what are those things? And those things are not things that I think the middle of the pack model can do today for us effectively. I think that adds cost and risk into the business that we won't be willing to deal with. But when you look at Astra, you're like, we're not that far. Six months from now, when OpenAI or Claude release or Enthropeit release their next models, we might be able to do a lot more in a business.

20:38back to the original point of this section, which was gross margin. Are gross margins a problem for the application layer? Are they irrelevant? Is it, listen, to the point, if you can show me that you have clear product market fit, you have clear penetration with your customer, and your explosive growth, I can tolerate gross margins. But again, to the point, if you don't care about gross margins at all, then you're reselling mediocre intelligence. And if you do dramatically care about gross margins, it means your business model is completely dependent on the frontier labs. Let me add one more question to that, because I do think your mediocre intelligence, the dressing up of marketing of companies using open weight models is that they have their own data, data mode, and their own data is adding to this.

21:24Is that just all marketing BS? And does that actually even matter here? Or does that actually really help the answers that are getting back and the intelligence that they're getting back and could turn a mediocre intelligence into actually a worthwhile one. Let me ask you this question, AJ. Let's ask you this question. Let's say there's an FP &A tool, not Lagora because we're not lawyers, but like there's some FP &A tool that's AI powered that is your outsourced CFO or something that you could hire a mid-level finance person, but they could function like a premier CFO because they have this thing that it's got bookkeeping and it's got all this different stuff.

21:58But you read the headline that usage was exploding for Shmarvy. Shmarvy's in the finance functional area. And Shmarvy was growing like gangbusters. But now, and you're a Shmarvy customer, you're like, Shmarvy's pretty cool. But Shmarvy just announced that we're down, you know, we're going back to Sonnet for all of our... But don't worry, it's just your books. It's just your finances. How would you feel about that? Very negative. Very negative. And I'll tell you why, because we're dealing, and this isn't FP &A, but we're dealing with a bunch of bookkeeping, accounting stuff on phishing scams right now.

22:36And it's like the most important part of my business. And if I have anything that AI is touching in that area, I'm actually like very, I'm in tune with it right now from a CEO perspective. Don't you think also companies will take the counter position of basically going into the market and saying, we are the application layer company that will not compromise on the intelligence it uses to serve you? Yeah, but at negative 50 % margins, you don't have a business. If I had three tools coming to me and one said, listen, we promise we will always use the very best intelligence out there. We're not going to compromise on that part.

23:10I will take notice and they'll say we've raised more money to be able to subsidize this. Then why wouldn't you just use Astra though? Like, why is it like tooling is important, right? Like the workflows are important. I get that. The product matters. Yeah. I mean, I think companies are saying that and that's what they have to be saying. and so it's going to be interesting to see when they take a... No, companies are starting to hide from that, right? They're like, oh, we've got like now our workloads are spread. Look at this new model that we created. It is so performant on this benchmark that we also created.

23:41Like, look at this. We're turning into this world where everyone's PE owned and they're all like, this is... We're great. It's going to get better. This episode of Topline is brought to you by Compound Growth Marketing. Listen, the way your customer's bias shifted. Before they ever reach a rep, they're asking an LLM who to trust, who to shortlist, and why. Decision-making is impacted by investment at the top of the funnel, but most B2B marketing teams under-invest because it's difficult to measure. That's the gap, and it's expensive. Compound Growth Marketing, or CGM, bridges this gap for many of the fastest-growing companies in B2B SaaS and cybersecurity.

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24:50I haven't heard anyone doing all the way through. EGM's doing it. Compound Growth Marketing is doing it. So check them out. Compoundgrowthmarketing.com and then mention Pavilion, but mention it with one L. It's P-A-V-I-L-I-O-N. Two L's. Where does that get you? It gets you nowhere. We don't get credit. They pull the sponsorship. We all go homeless. We're on the streets. It's terrible. That one L. Double L's going to be trouble. I am sleeping in your safe room. Me, Rose, and Gabriella. I want to tell you something I've been very excited about recently. It's a thing called Computer by DevRev. Have you heard of it, AJ?

25:27I think I have, Sam. I think I've heard of Computer by DevRev. And I'm so excited to talk about this. Tell me about it. I'll tell you about it and then I want you to react. If you work in GTM or sales, you know what it's like. You're running a dozen deals at once. It's on you to remember every detail, what the customer said, what you promised, what needs to happen next, et cetera, et cetera, et cetera. A follow-up gets missed. A deal goes quiet. Computer by DevRev. is an AI teammate that fixes that. Computer uses something called shared memory, very technical term, to hold the full context of every deal across all of your different places where information is captured, even across the rest of your team, so nothing falls through the cracks and you always know exactly where every account stands.

26:08Your deal keeps moving and you stay one step ahead. Take a look at computer.io forward slash top line. AJ, your reaction. I love that you added the very technical term to shared memory. That wasn't part of it. They haven't capitalized in the end. They haven't capitalized. Super technical. Look, the end of the day, all of our data is all over the place. It's scattered through the ether and we need to centralize this. We need it on top of it. And having an AI teammate that can do that, as I've said numerous times, I'm all on board. That's great. All right, so everybody, listen, I agree with AJ. This is good stuff.

26:41Go to computer.io, which is a pretty good URL. Mazel, it's devrev, forward slash topline, computer.io forward slash top line. And they don't have a deal for us to offer you, but they do have a URL attribution. Buy something from computer. We get credit. We can stay housed. And I don't have to go to AJ's safe room for water. It's a panic room for the record, Sam. Sorry. It's a panic room, not a safe room. When I show up on your doorstep, I can assure you, you will be panicked and so will I.

27:15this episode of top line is brought to you by gtm 2026 and experience pavilion uh this week if you're listening to this on sunday beginning this evening with the zig ai kickoff party tomorrow we've got the women's summit tuesday we've got circle day where we've got private rooms of functional leaders aj asad and i will be in the gold pavilion gold room where aj and asad will be talking about executive compensation. Wednesday, I'm interviewing Nick Mehta, and we're going to be talking about his journey, building Gainsight and now building something new. Thursday, Jeffrey Moore. Meanwhile, the entire time, there's all kinds of parties, there's happy hours, there's cold plunges.

27:55It's over, I think as of today, we've got over 1 ,300 total registrations, which is by far our largest GTM. It's the Pavilion 10-year anniversary. I've been doing this for 10 years and it's going to be an absolutely incredible week and we're also having a very special pavilion gold dinner meanwhile on stage uh at gtm i'm going to bring on amanda calo ceo one mind because pavilion and pavilion ventures uh which is really a framework for individual members of pavilion gold and soon pavilion scale investing individually in deals and then uh uh nico and gabriel from dust another company that we invested in.

28:33All of that's going to be happening over the next couple of days. So if you're in New York and you don't have your ticket yet, you can find your way into the main session. The Circle Days are sold out. Women's Summit sold out, but the main session might have one or two slots. AJ, what are you most excited about over the next couple of days? Hold on, Sam. I'm responding to your emails right now for the ambassador program. I got it. Oh, right. Pavilion. Man, what an agenda. Seriously, kudos to you. 10-year anniversary. 10 years does it feel that long does it remind me of you had um transform 2021 that's remember that was the remote one that i remember oh my god that was a throwback or i think they used to be called elevate as well but then elevate in there it does not feel that long i am most excited for uh gold well two things one we are we have plenty of in a studio top lines that we're recording so really excited about that and then uh austin and i getting to present on tuesday morning all about executive comp a topic that's near and dear to my heart that i've talked to so many gold members about uh emily's hooked me up with a few you've really helped a few i i was i was with one in amsterdam who was raving about the impact that you had on his compensation well then you then if you hear that that raving review you need to be a pavilion gold member and join us on tuesday for Circle Day.

29:55It's going to be a great week, everybody. And then after that, I'll be in San Francisco for two weeks and it's going to be fun. So we'll see you in New York this week. Thanks for listening. Thanks to Pavilion for sponsoring Topline. Things are going to get better. Before we move on to the next section of corporate M &A, which you're going to lead, but my final question to the two of you is, so where do we stand right now? Are we bearish or bullish? I guess on the market, you know, on the AI trade, you know are you on the sidelines are you long are you short because over the past couple months I would say but maybe it's just weeks that have jumped out at me I felt that you were doing the math more than I was I'm generally you know I guess over 10 years I'm very long AI but what I seem to pick up from you is that the debt loads you know the leverage uh the here's how much revenue is going to need to be produced the Tomas Tongus conversation where do you sit are you long are you sure?

30:49You know, if I connect this to your initial question of does gross margin matter, I think it comes down to the entrepreneur and what game you want to play. I think there's a game which is I'm willing to build a business where there is a chance if the ecosystem I'm building it in hits a wall, my business will burn down. I'm okay with that risk because the other side of that is that if we somehow work through this entire platform shift without having a bust, and we have many corrections, that's the whole, that's the other side of the argument is that one group says, there's going to be a bust. It's going to happen, the bubble will burst, it will happen, it has to happen, we just don't know when.

31:35The other group says that, hey, one second, it has always been like that, fair, but there is a world in which you can have this sort of platform shift and have exuberance and risk and all of this stuff. And you will have many corrections over the span of like seven, eight to 10 years, but you won't have a bust. And this can happen as long as revenue and growth keeps up with the investment we need to make. That is what wasn't in place before. It is what we have right now. And so if you are in that school of thought, you're like, I'm going to build Harvey where I don't care about gross margins. I think it's a feature.

32:15Look at my usage. Like, look at how cool this usage is. Let's raise some more money. Let's throw it into that. Look at Instinct. Instinct went from like not existing to a$10 billion valuation in a handful of months with 100 ,000 users, mainly in San Francisco. And investors are like, okay, let's go. Let's give them a bunch of money. Look at all. They look at the madness of instinct as a feature and they're willing to put money into it because that's where the market is today. And if you're an entrepreneur that's willing to take that risk and you're in that school of thought, you will build these businesses knowing that I could be wrong on my overall macro thesis, in which case I'll take the L and we'll figure it out.

32:54It'll be fun along the way. I'll do some set in diaries. I'll be fine. I think it's a really fair way to play the game. I don't I don't disagree with the choice over there. These are young entrepreneurs that said, what else are you going to do? Like build a slow, growing, steady, eddy business in a moment like this? You're not. You're like, let's try to change the world. Let's try to take over. I think that onto your second question, I just hope that the revenue can keep up and because the investments are not stopping and the market's getting a little bit trickier, right? Like interest rates are now going up.

33:30So much of this is fueled by debt and borrowing. And when the cost of borrowing goes up, everything goes a little bit, gets a little bit harder to do. And so it really requires revenue to keep up. And that's where it comes down to the intelligence becoming better and better, unlocking more use cases. And these application layer companies figuring out how to use that intelligence to provide more ROI to their customers in different industries, like it really has to keep working and keep increasing. And I hope it does. I really, really hope it does because I don't want to deal with another down market.

34:07But you can't look at this game on the field and think for sure it's not going to hit a wall. You're like, it's kind of a 50-50 right now. Sam, you shared a really important tweet this morning from a friend of the podcast, Michael Walrath, CEO of Yext. And a really interesting point that made me think about this and got a little bearish reading it, but why don't I read it to everybody and then you comment, AJ? Yeah, go for it. This is from Michael Walrath and we're recording with him tomorrow when you're listening to this in person in New York. He's the CEO of Yext. If you're a founder, the most valuable thing you can do today is seek out connection with founders who raise huge rounds at big prices in the 2020 era cycle and are living with a broken cap table and disinterested investors who have moved on.

34:53The above describes 90 % of growth rounds done between late 2020 and late 21. If you're struggling to be hot in this hype cycle, understanding the downside risk of being popular and huge multiple will take some of the sting away. If you've already raised the mega round in this current cycle, this might be the most important thing you do this week. No founder wants to think about the 90 % probability, 90 % that you are the next Airtable or Miro, but it's by far the likeliest outcome for even the hottest companies today. VC investors have no incentive for you to be thinking about the downside, but you have real incentive to understand the dynamics.

35:29Then get on with building value for the long run. I absolutely love it. And so Quotapath, when we raised a$40 million round Series B at a 100x valuation in 21, And my perspective at that time was we're going to grow into it. I still share that perspective. The challenge is what I didn't really foresee is the market and the multiples of SaaS being where they are today, which is 1x or less than 1x. If I wanted to go sell Quotopath today, I really couldn't find the buyer. That's great to hear as an investor. Let me, let me, let me, hold on. He's telling the truth, Arsene. I'm telling you the truth.

36:14I'm getting real for you, Asad. I sat down with a CEO of someone we all three of us know last week. We all know her. Unbound. Or him. And her business is doing super well. It means$50 million plus,$50 to$100 million business, ARR. And if they wanted to go sell their business and have investors that wanted to get out, they wouldn't be able to do it. Okay, let me push back on all of this. I think Michael's wrong. And I think a little bit of our judgment has been clouded by the past that we have lived. You know, the past can inform us, but it can also sometimes create these limiting beliefs and limiting thoughts.

36:52And sometimes we over extrapolate lessons. And so, number one, I think one of the big differences between the SaaS era and now, you know, you see Adam Robinson type people that are always posting about companies that raised a lot of money, hit a wall, and the founder walked away with almost nothing. That is not happening. That is just not happening anymore. Founders are making a lot of money along the way. Secondaries are massively up. We wrote about this in the top line. They're making more in secondaries than their revenue right now, though, Asad. That's the whole point of the hype market. And that was true in 21.

37:28But one of the arguments is if you're a founder, you're doing this thing, you're serving VCs. And often these founders get screwed, because they raise too much money, they build actually a decent business, but then that business is not worth anything. So when it sells, the founder and the teams don't make money. But that's just not true anymore. The founders are making a lot of money along the way, they're taking liquidity, and employees are taking liquidity as well along the way. So okay, so that's very, very different. Number one, I think your point of view is warped by the 1 % to 2 % frontier models that you're hearing about.

38:09I highly doubt that the majority of companies, secondary employees. Peter Walker published this article, I think towards the end of last year on Topline, that showed how much secondaries has popped up. And it wasn't just the two, three best companies in the world. Clay had done a tender. Clay is like middle of the pack, you know, decent company in the grand scheme of things like and they've done tenders as well. So, A, there's more liquidity in the ecosystem. And so that is risk and upside. Actually, the risk is a little bit lower because you're getting upside faster along the way. There's more upside available.

38:47And it's not only when the outcome happens. Let me push back. OK, you're I think you're dead wrong. And here's how we're going to prove this. Really? I don't think. How is he wrong? because if we went to at gtm next week took a poll the audience there'll be a thousand plus that's not us's point that that's maybe that's the related point the related point is who are we really talking to you know it's like but i think the people at gtm next week will be the majority of who i'm talking about i agree with you but that's not who it's like there's this fake world of like these ceos that could raise a billion dollars but they should choose not to there's no faith that the world doesn't exist if you can raise a billion dollars you did raise a billion dollars and 20 million of it was secondary and otherwise the market thinks your company sucks and that's there's nothing there's no motivational quote about that that's just where the market is you know what i mean like so what that's why i agree with osset it's like you should if you can raise at those super valuations the other thing that's likely is that you can get a shitload of secondary and if you can't yeah nothing's going to save you and that was how is that different i I mean, that's...

39:54Well, what percent... I mean, how many employees do these companies have? They have 70, 100 employees. I mean, Cursor was... Cursor, two years ago, when it was like flying at$100 million, had 30 employees. So you're talking about secondary for 30 people? Like that, it just... It's not the market. For the employee of the business, we're talking about in a business, there's employees and there's the founders that are taking this risk. And there was this imbalance in the previous part of our journeys in tech. In the SaaS era, there was this imbalance between VCs, employees, and founders. Employees were the bottom of the barrel, right?

40:30Like they had no preferred. They had to wait for M &A. They only had common stock. Yeah, they're waiting for a transaction. Right? But they also took less risk. They were employees. So because their risk was their time and their effort and they got paid cash for that as well, they were at the bottom of that. Then you had the founders in the middle and you had investors at the top. Investors were the most de-risked out of the three. But it was a little bit imbalanced because people felt that the investor was in the best situation out of all of these three parties. When a company would do well, everyone was fine.

41:05But when a company wouldn't do well, the investor felt a lot less pain than the others if there was an outcome. This was a frustration. But if there's more balance between these three things, then you say, well, why not go and try to build a generational business? Because, yes, you might hit a wall. But along the way, everybody's gotten money. Everybody's made money along the way. And more of those companies can exist now than before. And so it's like a big motivation to go and try and play this game, I think, is a more balanced game on the field for these companies. But when you're talking generational, you're talking about generational wealth, not generational as a company.

41:45A generational company. Like you're trying to, if you're Harvey, you're out there trying to change the legal tech world. Company that's two years old, by the way. Company that's two years old. But you're trying to change how lawyers do their work, right? Like fundamentally shift everything. And you're going to take this risk. and you might end up being the Thomson Reuters of this moment or the Lexus Netsus of this moment, right? The company that defines legal tech. Great. And you might hit a wall. And if you hit that wall, everybody made a lot of money. If you hit it out of the park, everybody is so happy.

42:27And why not grow for it? If you're these founders, you're like, why would I not grow for? what am I going to build? Adam Robbins' business? Yeah, I think there's two things here. One of them is how much money you're raising and at what valuation and whether you're trapping yourself. That's not really the point, because really the point is the other part of it, which is that most companies can't do that. For me, the point of all of this, to your point, AJ, and my company is no different from yours, is the multiples that we thought our companies were valued on have completely shifted. Because what I see is just there's two companies.

43:00There's companies in the flow that are skyrocketing, and there's everybody else. Alsa's presenting it as a choice. We all faced a fork in the road, and we chose the slower-growing, boring path. Well, we could have chosen the faster-growing path at higher valuation, and we just chose not to. And I think the reality is most people don't get that choice. We just have to decide what we want to do with the fact that our businesses are out of favor relative to Harvey and Lagora. I wouldn't have changed a thing, Sam. And I remember at the time when it was happening and I was talking to Max from GTM Fund and he was looking at us versus a competitor to put money into.

43:40And he said, well, you're not thinking big enough. You're not raising enough money. I want to go with a bigger company that's raising enough money. And I was so pissed because at that company, we had 24-year-old founders. I was like, they have no idea what this amount of money is going to do to their cap table. I thought that in 21. And I still think that today. And it would have been different. It would have been different if 10 million of the 40 that you raise or whatever it was went to you personally. Then you'd be like, who really cares? Right. But I was a second time founder. And like, I believe in my business.

44:11And at the end of the day, like we've made changes. You both know, like our cap table is in a good spot because of this exact thing. And we were fortunate to have an investor that was like, you know what, this isn't my thing. And just raise his hand and said, like, I want out. I'm like, OK, let me figure it out for you. I'll go ahead and figure that out for you. No problem. And we did. It's here, but we did. And that put us in a better spot for our cap table. We're not perfect. The generational piece that Oz is talking about really resonates with me. What I get frustrated is like, I don't believe that these companies that are raising right now, regardless of the secondary or not, are actually thinking generational.

44:50Maybe Harvey, we're using Harvey as an example. And I get that the mission and the vision of it is amazing, but they don't have enough proof points. They don't have enough data. They're not Tesla. They're not SpaceX. like Elon actually is a generational founder and how he thinks about it. But these founders, we don't know. We don't know. There can't be that many Elons. That's what they're setting out to do. I think there's a choice you make at the start of creating a business. Do I want to create a business that is like an Adam Robinson business on one side of the spectrum? Or do I want to go for it?

45:20And you do make that choice. Like there's that choice to make. And both are fine. Like Adam Robinson's rich and happy. But that's the first choice you make. Then you start off. Did you get that from his Instagram or LinkedIn or something? I also just don't know. You can't tell. Like you just literally can't tell. We all, a lot of us get trapped in our own businesses as well, Asad. We can't, we can't, I don't think we can make that statement. I think he's, he's doing exceptionally well monetarily. He does seem a little bit insecure about the rest of the world. And so I don't know, like, I don't know if that part has given him that fulfillment because he just keeps talking shit about the other side and like if you i don't know if it feels i think it's a bit i think he's happy okay he's gonna have been pulling down you know his businesses make 25 to 30 million with 50 percent even done margin i think he's happy so he's a happy guy and then on the other side i think you go for it and you try to do something generational and you might hit a wall and then no longer be in favor and then you have to do the hard things and that's business but at least you're going to go for it and I think this in this moment in time it is really exciting and if you're a young founder you're like why should I not try going for it money is flowing I can raise capital I can get liquidity customers are buying demand is out there like what am I playing the game slow and measured for like what am I trying to optimize for gross margins and efficiency today for like let me just drive this thing as fast as possible as hard as possible, see what happens.

46:53I'm 29 years old. Like the worst case scenario is the bubble burst. What I, the fuel I need is no longer available. And I start again as somebody who's worth 30 million in the bank at 34 years old. And I do something different at that point. Like that's the game. That's how they are thinking. It's important to understand how they're thinking. And with that mindset, I can't fault them. I'm like, yeah, that's today. I would do the same thing. Yeah. Well, I heard Abe barking in the background. He agrees with you, Asad. So you got that. No, that was my power chart. Abe does not agree. From Abe's perspective, everything comes down to treats.

47:28Are we getting more treats? One of the treats is give me some treats. Let's switch topics, but to related topics, which is corporate M &A. So if you're watching on YouTube, Asad's got some slides that he wants to present, but Asad, talk us through these slides for the people that are listening in their cards right now. Deals. Deals. Deals. Okay. So last time we did this where we didn't have a guest and we were chatting, we were talking about how hot the talent market is and what that's doing to compensation, how hard it is to hire, how saturated the talent markets are. Which by the way, if you're a part of Pavilion Gold and you're listening to this, Austin and I are giving a special presentation in the gold circle on Tuesday, 10 a.m.

48:12Yeah, we'll be there. So you get this in person with us. So we spoke about that. And I want to pull the thread of the talent market a bit further. So the thing I want to start with is that there's a lot of deals, a lot of M &A that's happening in the market. If you look over here, you see 2022 to 2023, we had a 58 % reduction in deals that took place, acquisitions and mergers. By 2024, the market started picking up. You had a 41 % increase in 24 versus 23, and a 68 % increase in 25 versus 24 in the amount of deals that were happening in the market. These are companies buying other companies, and these are tech companies broadly.

49:02When you click into AI, you see that it's even more pronounced. So in 23 to 24, these are the early days of AI, there was a slight increase in acquisitions, 16%. By 24 to 25, there was an 85 % year-over-year increase in the number of acquisitions that was happening in the market. And even right now, if you compare just Q2 of 2026 to Q2 of 2025, you see a 49 % increase in the number of acquisitions that's happened during that period. So this is a market where companies are buying other companies at a rate that is much higher than I think people are realizing. They're buying them for interesting reasons.

49:44They're buying capabilities, even though building product has become easier because of things like codets and clock code. In some cases, it gives you a jumping off point where you can just buy something good in the market and bring it into your organization. And then the other side of this is talent acquisition. There are a lot of companies that are raising rounds and then going trying to find small startups where they can acquire those companies for the talent. And we see this with big companies as well. There was the Windsurf thing that we covered a long time ago, where Google wanted Windsurf's founders to come and lead this division within the business.

50:25And so So they did some sort of aqua hire type of M &A deal. Just for the founders, though. They left everyone else in the cold. It was literally the founders. Yeah, they left them some money and they did this and then a bunch of things happened. So there's more M &A happening in the market. And I think the question becomes, if you are not the founder or the investor, but you're the third part of that equation, you're the employees. What does this mean for you? So last time we spoke that because the market is hot, you're getting more cash. But I think what this also means is because of this market, your equity is actually a little bit in a bit of a precarious position.

51:05The way that we've classically done equity is that we give you an allocation that vests over a four-year period. The probability that the company you work at gets acquired has increased. and those companies are getting acquired at all different points in their life cycle, some very early, within a year, within two years of you joining, that company could be acquired. And you could walk away with nothing. You could walk away with something. There's a chance that your company gets one of those strange acquisitions where the founders get acquired and you get left with the rest of it. And you're like, what is this now?

51:41And so I think we need to create a conversation around how do we protect ourselves? You know, employees have always gotten the short end of the stick in terms of risk versus upside here. We do need to have a conversation around how equity should work now. And I think what should happen is this. You should just get credit for time worked. So, like, imagine that you work at a company. You work there for 10 months and a deal happens and you've vested nothing. If you don't have something like a double trigger or a single trigger equity clause that says that when an acquisition happens, all your equity vests, or if an acquisition happens and your role changes, which is a double trigger, then you're all your equity vests and you get all these special things.

52:26Imagine you're just a junior mid-level person and you don't have the leverage to negotiate that. And you get nothing, unless people are being generous. But if everybody just went to this credit for time served model, then it's basically prorata. For however long you work, that allocation over a four-year period keeps vesting. And it doesn't have these, oh, it vests at the end of year one and the end of year two and the end of year three, which is this arcade thing that we've been doing. Instead of behaving like dinosaurs, it just vests on a monthly basis. And I think that's a big shift that has to happen.

53:01Otherwise, we again have this sort of imbalance in the ecosystem that causes a lot of frustration. And that frustration bubbles up when markets get choppy and people get angry. And there's already so much negativity in AI. Let's try to be happy. And I think this could help. Thoughts? My reaction to what you said is, as a CEO with a lot of dead weight on my cap table, of people that have shares forever, that haven't helped the company grow or made an impact in a long, long time, I'm okay with what you're saying, Austin, provided that they get smaller equity grants. You know, we have this ambassador program at Pavilion, and we've got people that have, you know, small amounts of shares.

53:43It's not life-changing, but I can't even get them to respond to an email. You know, I have an email distribution for Pavilion Ambassadors. It literally says, reply to this email. And most of the time, they don't reply. Now, the two of you also don't reply, but I see you every week. So it's not as good. You know what's so funny? I have 30 unread emails, and one of the unread emails is literally replied to this email from Sam. I'm not even kidding. I'm looking at it right now. My point is there's something weird about equity because it's forever. And if you're going to be logged into the ledger of people that truly built the company, that's why I agree with the concept of vesting.

54:23because what if you hire some jerk off that, you know, wastes your time for three months or six months but you've got immediate vesting. That person is a part of that journey forever, if potentially. Now, what you actually, Asad, you were talking about vesting without the exercise period. So listen, maybe if it's like we keep the 90-day exercise period and you get monthly vesting and most of the people that get fired quickly never exercise in the first place because they don't have the cash. Fair enough. But I will just say, I hear what you're saying and I want equity to be worth something for employees too.

55:00I really do. But there's something disconnected about the fact that maybe you made some contribution. First of all, there's two things. By virtue of the fact that you're at the company, it assumes you make a contribution. I don't know any other way to do it. It seems like the most logical way to do it, but it's certainly not true that everybody that ever worked a place made a big impact. And the second is equity is forever. And so it's like 10 years later, if I gave you monthly vesting and if it was a grant, not an option and you, or, but if you exercise, you're on the cap table forever and you haven't done anything for 10 years and you won't even respond to an email to help introduce a few prospective members to our brand new programs, gold and scale.

55:39I don't know. It just annoys me. I I'll tell you, I'll tell you, uh, like specifically as a CEO, here is what I plan on doing over the next 12 months. I plan on going to a lot of the people that won't write me back and saying, I'd like you to forfeit your shares. Now they don't have to. It can say no, but I plan on being like, listen, you're clearly not helping. I don't like looking at your name when I look into Carta. Your face is ugly. Please give me my shirt. You are right. Like this is the other side of it, which is like, oh my God, there's going to be so many people that sit on a cap table that you just feel down the line don't deserve to be there.

56:11And I think there's balance that has to be created for the people that are really good and that it is safe for them or fair for them so that they actually want to join your organization so that you can attract great people. Like I think having a balanced approach to this will help attract really good people. What is that balanced approach? I think I do like the pro rata part. I think it needs certain clauses for protection. So if it's within the first year that an acquisition happens, I think what you're protecting for is an acquisition, in which case maybe how your equity is dealt with at that point is different but if you get fired within the first year you know on the other side of this we didn't get acquired and you're trying to shit at your job then I can buy your equity back at like a certain you know multiple or you have to exercise it within a certain period but there's ways to think of it did we try to have like a very simple structure to equity.

57:10And in doing so, I think we hurt certain people, and we try to overbalance our own protection. And then we end up actually not being able to attract great people as a result in a market like this, you need everything like lined up really well. And so instead, if you just say, hey, you're not performant, we fire you, then you don't get to hold on to that equity forever, we can buy it back from you within that first year for like 2S or what we gave it to you for, something like that. Whereas if an acquisition happens, you do all the best thing. I think that's balanced. Sam, I got two things on this topic.

57:43First of all, AJ just wrote me back. I replied to Sam's email. So I felt like Sam was talking to my soul. He was like, I am going to make you forfeit your shares if you do not reply. AJ, I see you all the time. You're a supporter. You're a great ad reader. you are not the problem. For the record, he had three things in his email and I did two of the three things already without replying. Yes, you did, brother. Equity is, I love the thoughts around equity and just how can we get our companies and our team more galvanized around it to actually care about it in a world where it's really challenging to care about it.

58:23So I've seen two things. One, an anecdote. Back in 2013, 2014, we brought on a new CEO at TrendKite. And as that CEO was coming on, I went to that CEO and said, hey, there's these three early hires, Lindsey O 'Neill, Max Bergen, and James Trudy. Lindsey DeFalco is now the chief product officer of Crossbeam. James Trudy and Max Bergen both work for me at Quotapath. Max Bergen is your new head of strategic sales. VP of strategic services. and I said to Eric I was like Eric these three people need to have more equity they've done a tremendous like they're just so much for this business that I like something needs to happen and Eric was like cool I don't know them from Tom so no I understood where he's coming from his perspective is like well they're they've got an equity so who cares and I was like look no I care so much that I would want, I want to forfeit some of my founder shares and give them those shares to, to see, see, like, I just think so highly of what they're doing.

59:32And it became a big conflictive situation at the board meeting. Long story short is it ended up happening. And Lindsay stayed on, uh, for, for six years, uh, James, same thing. And, uh, Max, he left after three years. And I think one thing that's funny, I've told him this, he left and forfeited some, He didn't best all of the shares that I gave him. And so he left money on the table. It was really frustrating because it was like my shares, but it was fine. He left for the right reasons. Fast forward, I'm still really good friends with Lindsay and I work with James and Max. And so you can create a world where those shares are really meaningful, but you have to do it very focused and you have to do it very clear with purpose.

1:00:12And so for Quotapath, the third point to this is that I have thought about this for my team and my company. And I was like, how can we galvanize the management team and a performance structure to really care about this in a way? So I was like, you know what? I'm going to go look at the market and I'm going to give them each 125 % of what the market is if we can hit these milestones from a performance standpoint in the next 18 months. I love the performance one. It's just so hard to do for certain roles, but I really do love it theoretically because it feels like token, like it feels like how we do equity right now is AI tokens.

1:00:51It's usage of a thing like that. It's not the outcome. Like it's not the outcome. That's my point. It's per user C pricing. It's tenure. It's like, OK, well, maybe I just never had the heart to fire you. Yeah. Maybe like I had other issues. Like I'm like, I'm not going to fire this. I've had five people leave. I don't want to fire this. It's worse. And like, you know, you've got reasons to not take that headache on in that moment. And if we can get to a performance based thing, maybe this is where as technology gets better, we can actually measure performance better. We went through this whole period and Sam talked a lot about this as employees.

1:01:25How do you how do you negotiate your equity? Like, how do you do that? But now we're in an employer world. And the reality of the situation is we need to get the most out of the people that we have, because if we don't, well, then we'll just spin up. I really think performance management is a thing that we hopefully will get a lot better at as we get this sort of intelligence in our businesses. Because right now we just think like, oh, you can't measure the performance of an engineer that easily. It's qualitative. And it's like, oh, my God, like that's not great for even engineers that it's qualitative.

1:01:58Like I don't want any qualitative assessments of people in my business. I want some sort of quantitative measure across every function. And we just haven't figured this out yet. But we have to, because if we can figure that out, then we can do things with stuff like equity that's very different. We have a much better read of the people that should stay in a business and not stay. So you can performance manage people in and out, up and down a lot better. And we just kind of suck at this. We're really doing it in sales because it's easy. It's revenue. But in every other function, like, do you know how to measure the performance of an HR function?

1:02:32I have no idea. I'll tell you one thing that would help us that is if you recorded the meetings that the person was in so we could get some feedback yeah, let's big brother this shit alright we didn't get to you AJ and I'm sorry we're going to start off with you in Bulls vs. Bears a segment that sometimes we have and sometimes we don't Bulls vs. Bears and I'm going to do a different version of it right now and the question is very simple Are you bullish or bearish on the human race not completely being annihilated? Let's say, let's not make it that the world doesn't end. But in terms of this P-doom, you know, Jacob Coxon and the people working in Anthropic and the people worried about AI safety are saying, we're building something so powerful, we won't be able to control it, but we have to keep building it.

1:03:26Some people are saying there's, you know, AGI, RSI will happen before 2030. So my question is this, are you bullish or bearish on AI causing a global economic catastrophe? Bullish would be that you do think it's going to happen. So you think that AI will do it and bearish means you're sort of, you're an optimist. I know the words are sort of strange, but let's say bullish or bearish within the next five years. So before 2031, a rogue agentic swarm or some version of AI will break out and cause a global economic catastrophe. AJ, do you think that will happen or not happen, bullish or bearish? I am bullish on that happening.

1:04:14So you do think it will happen? I do think that will happen, yes. I will not now what I will say is I will not bet against the human spirit so I do not think this will be the downfall of mankind but I do believe we are headed towards a major catastrophic event as it relates to AI in the next four years what do you think give us an example for you what that might mean would it mean like a reset on the financial markets or like clears all banking information. This is also kind of funny because I had a Austin currently has a fire alarm going off in his house and I had a fire alarm late last night in my Riverside instance.

1:04:59So I don't even know where he is or what he's up to. This is, this is amazing because last night at 1am, my fire alarm went off and I'm just now like, is AI taking over all of our fire alarms across? This is Austin pointing to himself saying, let's get out of there. Let me go back to the question. I do believe that we are headed towards some sort of catastrophic event. Are you doing anything practically around that? Are you taking your family money and putting it in gold or buying a property in New Zealand or building a bunker? This is funny. This is a funny thing about me, Sam. You're going to laugh.

1:05:35I've had a panic room in my house since we moved in that has water food supply for the next six months. But am I doing anything outside of my crazy... And how often do you go in there? Like just to check it out, make sure it's not too dusty? Every month. Do you have good bedding? Is it comfy? I can't give too much away on this. You're asking too many questions about what's the code to your door? Can I stay in your panic room the next time I visit? Yeah, I should not give like, I'm not going to dox myself on this. But I so I am definitely an alarmist and end of the world prepper. Yeah, I am a prepper.

1:06:15I'm actually curious, though, like, where do you stand on this, Sam? I'm an optimist. I do not think there will be a global. I think there'll be incidents like cybersecurity incidents, fo sho. But I do not think there will be some global economic catastrophe. I don't think AI will end up creating a bunch of bioweapons. Maybe I'm naive, but I, I, I'm optimistic. I think it's a tool. And again, you know, you, we watch these disaster movies where the lone crazy person is the voice of reason. It turns out, and ghosts really are real. And the asteroid really is coming to blow up the world and all that.

1:06:51They'll look up. So I, I hear that, but when I hear people saying, listen, and this is cyber security. We've, you know, we've needed, when you build things, you should be able to ensure that they don't harm the consumer. And if they do harm the consumer or do bad things, then that's part of what it means to design a product. And if you have no ability to design a safe product, then you can't sell the product. And we have laws for that already. I find that to be pretty compelling. So I think everything's going to be great. I love it. Well, Austin's gone. He's not here anymore. He's done. Listen, everybody.

1:07:28He has fire people here. All right. Well, no, we hope you're okay. Fire people. This feels like another possible reason for him to not show up in New York tomorrow. The fire people. I can't be in New York. I'm sorry. All right. Listen, if you're in New York and you listen to this right now, we're going to see you at GTM this week. Stop by the Glass House. If you know me and you want to text me, I've got a special one-day pass that nobody else knows about. I can give you the code for that. Otherwise, subscribe on YouTube. Give us five stars wherever you listen to your podcast. We'll talk to you next week.

1:08:01Thanks for listening, everybody.

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