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I see monsters on the horizon. You're watching TVBN.

4:35

Today is Friday, March 20th, 2026.

4:38

We are live from the TVBN Ultradoom, the Temple of Technology, the Fortress of Finance, the capital capital of capital.

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Uh we have a massive show, two in-person guests today.

4:54

Let's pull up the linear lineup.

4:57

Linear, of course, is system for modern software development enterprise.

5:00

70% of enterprise workspaces on Linear are using agents.

5:03

We have RF Kenmore from the menswear industry insider.

5:05

No, he just is a menswear >> He's an insider of the menswear >> critic.

5:12

Uh Mitch Lee from Arc Boats is coming on.

5:14

Bucky Moore is coming in person from Lightspeed.

5:16

Steve Huffman, the co-founder and CEO of >> Reddit.

5:19

coming on, then Quade from Bezel, who you know and love, he's been on the show many times.

5:23

Ankur Jain from Bilt is coming on to talk about Uh credit cards, consumer cards, all all the fi- uh fintech stuff he's working on.

5:32

And then Michael Kratsios from the White House, he's the science and technology advisor, is coming on to talk about the new policy proposals that the White House has put forward around artificial intelligence.

5:41

Um But first, I wanted to chat more about the breaking news from yesterday.

5:46

Jeff Bezos is in talks to raise a hundred billion dollars for an AI manufacturing fund.

5:53

Uh there was a funny post that was like he has two hundred billion dollars.

5:55

Why does he need to raise more money?

5:58

Uh uh uh uh uh >> No conviction? Oh no, yeah. No, it was funny.

6:03

It was like it definitely this this broke containment >> Mhm.

6:06

and got into kind of the anti-capitalist >> People are not uh part of X and they were like, "Wait, why are you asking people for money? You have all the money." >> Yeah. Yeah.

6:14

Uh but of course But of course uh he He wants to let other people in on the action.

6:19

Well, I want to let it I I do wonder what his like GP commit will be.

6:23

That's what I was saying yesterday.

6:24

I was like, "I would expect him to be like, yeah, I'm good for twenty." Yeah. >> Yeah.

6:28

Twenty or thirty or something like that. I don't know.

6:30

Maybe he'll go even longer.

6:32

Um but in general, I think the I think the idea of going around the globe because he's an international person at this point uh hovering up money from all over uh different sovereign wealth funds and then deploying that to help rebuild American manufacturing base is a good thing.

6:47

Um I wrote about it today in the newsletter tbpm.

6:51

com and I also tried to you know do some searching and think about like what do you actually buy for a hundred billion dollars?

6:58

What does the portfolio look like if it's a private equity style roll up?

7:01

Uh if you're just taking out the market caps and you're sort of assuming the debt and continue to operate the business but then bring more efficiency to bear.

7:08

Uh what are some of the top options?

7:11

What are some of the options look like?

7:13

I don't The other thing is I saw a very viral post about someone that seemingly read the headline and thought like, "Don't you have enough money already?

7:25

Why do you have to buy all these companies and fire fire?"

7:26

Like they saw automation and they just assumed like job loss.

7:31

And when I look at this, I'm like, "Okay, if he's successful, we will you know create uh we will actually start adding a bunch of new manufacturing jobs which we've been shedding >> Yep. over the last year.

7:43

>> Yeah, yeah, yeah, exactly.

7:43

Um So, headline number's funny.

7:46

If he had done 99 billion or 101 billion, I don't think people would make it be making as many SoftBank comparisons, but of course, as soon as you hear a hundred billion dollars uh for a mega fund, you instantly think SoftBank. >> He's got vision.

8:00

It's a vision fund for America.

8:02

I like the idea of an American SoftBank of an American vision fund. So, I'm generally pro.

8:08

Uh and uh but of course, people are going to make comparisons to SoftBank which has had some huge winners and a few black eyes.

8:14

Uh Masayoshi is a high-vol guy.

8:16

Uh he's been the world's richest man briefly during the dot-com boom.

8:21

It was reported that he was worth more than Bill Gates.

8:22

It was pretty temporary, unclear exactly how much, and of course, there was no liquidity at the time.

8:27

Uh but he's also held the crown for the man who lost the most money in human history after losing 76 billion dollars in two years.

8:37

>> [laughter] >> You're supposed to do the wah-wah after that.

8:39

But, he made it all back.

8:39

I I I was preemptively hitting it before you >> He did make He did make it all back.

8:43

Uh he's made almost a hundred billion dollars twice.

8:47

I think maybe there was a moment when he had he had the title of making a hundred billion dollars twice, one on Alibaba, and then the second one on ARM.

8:53

Uh he's made money on Nvidia and lots of other things.

8:56

Um But, uh the idea of an American SoftBank, especially one focused on revitalizing American manufacturing, I like that idea.

9:04

Um there are a million reasons why this is important project, job creation, economic independence, national security, etc.

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Uh and you might just get more cool stuff.

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Like as manufacturing gets cheaper, like the tools that you use, the cars that you drive, the washing machine in your home, uh the tires on your cars, uh all these different things get better, not just cheaper, but actually unlock new capabilities and new things that people people enjoy.

9:26

And so, I'm I'm I'm I'm in favor of more manufacturing, more more economic development, basically.

9:31

Um I don't think the project is done by any means.

9:37

Uh and so, the question about like, you know, Jeff Bezos' role, like he's a great operator and I think he's the right person to take the reins and actually deliver here.

9:44

So, like Masa, Jeff Bezos has been through the ups and downs of the dot-com boom and bust.

9:49

At one point, Jeff Bezos lost 85% of his net worth in like 2 years. But he made it back.

9:56

He did make it back and more.

9:58

He was worth like 8 or 9 billion and got down to his last 1 billion.

10:04

Basically because of the stock drop in Amazon.

10:07

But he built But he But he not only kept Amazon alive, which I think everyone knows that, you know, Amazon went up during the dot-com bubble and then crashed and then built back up.

10:17

But he also kept Blue Origin alive during that time because he founded Blue Origin in 2000. Wow. >> Before the crash. Yeah, before the crash.

10:24

So, he was >> Was it before SpaceX? >> Yeah, before SpaceX. Whoa. >> Yeah.

10:29

So, Cuz I I I For some reason I assume I I assume that Blue Origin was just thematic with Elon. >> No, no, no. He did it earlier. >> Wow.

10:37

And so, he So, he kept Blue Origin alive.

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And can you imagine how stressful it is?

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You're like, "Okay, I'm worth 10 billion.

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Certainly I can have a little side project as a treat."

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And you're like, [laughter] "Okay, I just lost 85% of my money."

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I deserve I deserve a I deserve a side project that loses Yes. 20 million a month. >> Exactly.

10:56

Yeah, I don't know how much they were losing, but like but that doesn't seem unreasonable.

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But he was able to keep it going.

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Of course, Blue Origin was a slow story all the way up until like last year when they landed New Glenn.

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And and so, he kept both alive and he's never given up on the project Blue Origin that always has felt behind SpaceX for two the two decades it's been [clears throat] operating, but is now sort of unlocking new capabilities and is feels more real. >> mode.

11:23

Yeah, turtle mode for sure. But it's working.

11:27

And so, like regardless of the fact that you know, SpaceX is still ahead of Blue Origin.

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You have to give him credit for like operating that company efficiently and actually delivering a product that we all saw go up and come back.

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And so, like, the rockets did go up and land and come back.

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And he's delivered people to space and back.

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Uh, and so, he's he's he's like achieved the goal and not lost all the money and not put the company in jeopardy.

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And so, like, clearly there's some operational expert >> narrative violation.

11:56

It is a narrative violation.

11:59

What makes Bezos uniquely equipped to take on this type of project is the nature of his business over the last few decades.

12:05

So, he's never really had the zero marginal luxuries afforded to other pure-play internet founders.

12:12

You think about Mark Zuckerberg, it's always been >> Except for his ads business.

12:15

Yeah, he has that now, but that's very new.

12:17

Um, for a long time for Yeah, a very real contributor now, but even even then, uh, it is much thinner margin than a Google or a Meta.

12:27

And it always has been because they've always operated in the real world.

12:31

They've been competing with Walmart and Barnes & Noble and and Borders and all the other Borders.

12:38

>> The big gross margins scare me.

12:38

Yeah, he's always had thin thin margins until AWS really.

12:43

AWS was the first like, okay, this is like a monster cash cow.

12:47

And even AWS doesn't have 80% gross margins, you know, it is it is uh, it is a cash cow, but uh, it's a different shape.

12:54

And of course, you go back to the Jeff Bezos lore and he had the door desk and the whole business was very scrappy for a long time.

12:59

Uh, and um, Amazon's just always interfaced with the physical world.

13:05

So, it's been even though it's a software company and a tech company, it's always interfaced with the physical world.

13:11

Uh, and they've had to focus on operational efficiencies to scale.

13:13

So, in 2012, Amazon bought Kiva Systems which turned into Amazon Robotics and that's a big risk to uh, buying a big company.

13:22

And we think that, you know, if this turns into if this hundred billion dollar fund turns into sort of a private equity roll up, you're going to ask the question, can Bezos buy a company for 1 billion, 5 billion, 10 billion, 50 billion, who knows?

13:36

Um and operate it and scale it and actually continue to deliver value.

13:40

And he certainly did that with Kiva Robotics, which turned into Amazon Robotics, which delivered over a million robots that are deployed across the operations network.

13:49

So, from fulfillment centers, warehouse automation, inventory flow, last mile delivery, all of these require tight integration between hardware and software to run smoothly.

13:57

Bezos clearly loves this stuff and you can actually see it when you look at his face whenever he gives a tour of an Amazon warehouse or an or Blue Origin facility, he's just beaming.

14:06

And uh he's absolutely obsessed with with this technology and and and the physical world.

14:12

Um And so, the question I had was like, what should he buy?

14:15

Yeah, the other the other thing is like you know, seeing all the different volume across Amazon and being like, well, it'd be pretty convenient if that was made here or this was made here or at least the Yeah.

14:25

some of the components were made here and it wasn't you know, you didn't just have assembly here. Yeah.

14:31

I mean, yeah, there there there isn't I I didn't consider that narrative, but there is a different flow where uh you're you're >> sitting there being like, great, I love that so much of our volume is having to be shipped or flown across the ocean. >> of that, yeah.

14:44

And then also, he's seen attacks from Temu and Shein and Alibaba and AliExpress and a whole bunch of direct from manufacturing plant to customer and how do you respond to that?

15:00

Maybe getting into the deeper in the supply chain makes sense.

15:02

Although, I'm not entirely sure that there's so little reporting at this point.

15:07

It's The only line is that uh he'll be buying manufacturing companies.

15:12

So, there's a lot in the supply chain, so I wanted to dig through some stuff that could potentially be in the crosshairs for Bezos. Uh the first is Lear.

15:18

They manufacture seats and electronic systems for the automotive industry.

15:25

And a lot of these companies have huge revenues and small market caps.

15:26

So, Lear did 23 billion in 2025 revenue.

15:33

The market cap is around 5 billion.

15:33

And so, the business is operationally complex.

15:39

I mean, on a on a PE ratio, it trades at like, I think, 13 price to earnings.

15:42

And so, like, you have these high revenues because you're in the manufacturing business, but you're low margin.

15:47

But >> this has been some of the concern around VCs investing in manufacturing businesses.

15:53

And and just a general concern that, you know, they might today be getting valued on the revenue multiple, but as they get to the public markets, people will expect them to be valued on on earnings, and that is very different story. >> Yeah.

16:07

Uh Lear, interestingly, not the maker of the Learjet, which sold to the Gates company, which is not affiliated with Bill Gates.

16:16

I was like, is there a link here? But there's not.

16:20

Uh but Learjet and Lear are two different companies, although they both make physical things.

16:24

But there's a there there there's an opportunity here for the Bezos thesis that we are sort of, you know, gesturing towards.

16:32

The business is operationally complex, and AI can be applied across plant scheduling, supplier forecasting, visual inspections, and more.

16:37

This whole thesis of like, the collars get less blue.

16:42

There's upskilling that happens in the facility, and you're able to produce more at scale.

16:46

BorgWarner is another example.

16:50

They're a scaled auto supplier.

16:52

14 billion in 2025 revenue. Market cap is 9. 5 billion.

16:55

They're more focused on propulsion and power-related systems.

17:00

They literally make turbochargers for internal combustion engines, although they've they they they have shifted their business a lot to be focused on electronic components, both in terms of making battery packs, motors.

17:13

But But actually already getting into selling turbine generator systems for data centers.

17:18

They're part of the AI boom already.

17:21

Uh and there's uh more opportunities to grow into different industrial power applications.

17:24

Hexcel is another company.

17:27

They're the a leading producer of carbon fiber carbon fiber reinforcements and resin systems for aerospace.

17:32

They're guiding to 2 billion in revenue, but the market cap is 5 billion, so a little pricier on a price per price to sales ratio.

17:41

Uh here's a fun one, Goodyear.

17:45

Not only do you get blimps, which is got to be important if you're trying to go blimp for blimp with Sergey Brin, you just just jumped to the front of the line. It's only a 1.

17:52

8 billion dollar company. >> criminal.

17:55

Yeah, it's only >> [laughter] >> So, the market cap for Goodyear is 1. 8 billion.

18:01

And revenue is 18 billion.

18:01

So, they're they're trading at a point >> Somewhere out there there's like a VC-funded uh tire company. >> a 100x revenue. Yeah.

18:09

And they're like, "We're going to go through a 1,000x multiple compression over [laughter] the next decade." Yes, you will.

18:15

Uh but uh Goodyear's a sort of the classic AI for manufacturing case. >> They got to focus.

18:21

They got to get investors thinking about their their advertising blimp monopoly. Yep.

18:27

>> And scaling that business. >> Yep.

18:28

To capitalize on that that Quality control is really critical.

18:30

Uh there's opportunities for downtime optimization.

18:34

So, if you can have better systems that limit downtime, you can produce more tires.

18:39

The tire market is extremely competitive.

18:41

You see Chinese tires on cars more and more.

18:43

And so, these are thin thin thin margin companies, and that's why the multiple is so low.

18:48

But uh getting Goodyear >> Scariest scariest moment of my life in a car. Yeah. Chinese tires. Old Chinese tires. >> Old Chinese tires.

18:56

Uh but but, you know, a lot of people go in and they say, "I need new tires.

18:59

Just give me whatever's cheapest."

19:00

And so, if you're competing on price and you're a low-cost supplier, uh every dollar counts.

19:05

Uh on the bigger side, you have Rockwell Automation.

19:07

I don't know if you've ever seen those videos for the Rockwell Turbo Encabulator.

19:10

Have you ever seen these? We should pull this up.

19:14

Let me let let me find >> It's It's one of the best like uh like uh you know, marketing videos. Uh Turboencabulator. Let me find this.

19:24

The Rockwell Retroencabulator. I got it here.

19:26

We'll We'll We'll watch this.

19:29

It's a 2-minute video and we'll see if you can Yeah, yeah, any of these. Uh yeah, we got these.

19:35

Uh if we can pull this up and uh Let's play Let's play it.

19:40

>> Here at Chrysler Motors automotive operations, research has been proceeding to develop a line of heavy-duty transmissions that establishes new standards for reliability, durability, and quality.

19:51

With customer needs as our primary focus, work is proceeding on the crudely conceived idea of an instrument that would not only supply inverse reactive current >> is Yeah, I think this is Chrysler's like joke.

20:04

Let's play the one that I that I shared from Rockwell.

20:08

Uh this is This is the the good folks at Rockwell Automation who >> Rockwell headquarters, research has been proceeding to develop a line of automation products that establishes new standards for quality, technological leadership, and operating excellence.

20:25

With customer success as our primary focus, work has been proceeding on the crudely conceived idea of an instrument that would not only provide inverse reactive current for use in unilateral phase detractors, but would also be capable of automatically synchronizing cardinal gram meters.

20:43

Such an instrument comprised of dodge gears and bearings, Reliance electric motors, Allen-Bradley controls, and all monitored by Rockwell software is Rockwell Automation's Retroencabulator. Retroencabulator.

20:55

>> Now, basically, the only new principle involved is that instead of power being generated by the relative motion of conductors and fluxes, it's produced by the modal interaction of magneto-reluctance and capacitive directance. Capacitive interactance.

21:08

The original machine had a base plate of pre-familated >> [clears throat] >> surmounted by a malleable logarithmic casing in such a way that the two spurving bearings run a direct line with a panametric fan. Canametric fan.

21:20

The lineup consisted simply >> It's just a It's just like such a funny in joke for electrical engineers because it's just a whole bunch of like slop basically.

21:29

Like oh none of these terms mean anything.

21:32

Uh but it really uh I don't know It's a startup good startup launch video concept. >> Yeah. Yeah. Yeah.

21:37

It really I mean it it it it helps you like detect like are you in group out group basically. Uh very very fun. But uh they are What?

21:46

>> Well, were you able to clock it or were you like oh that sounds good? Yeah. I mean it sounded silly. It sounded silly.

21:51

Um so Rockwell Automation's on the bigger side uh but they sit right at the intersection of factory automation and software and control.

21:59

So although that video is a joke, Rockwell does uh does work on on factory automation already.

22:05

So the thesis with this one is that uh the business is already already dedicated to industrial automation and so it's less of a turnaround, but it's a control point for pushing AI to thousands of other factories here deeper in the supply chain.

22:18

Uh it's expensive at 40 billion, but potentially in the budget.

22:22

Um Do you think there's a world where he just buys uh Ford Motor Company?

22:26

He would have He would have obviously I mean he wouldn't he would have to lever up. Yeah. But >> What is Ford now?

22:34

I thought it was It's 45, but I but I'm not but you he's not going to just drop like raise 100 billion and then and then buy a company for entirely with equity.

22:45

>> I I I feel like it will be deeper in the supply chain than a brand, but I don't know. It's possible. It's possible.

22:51

But he might say >> Isn't he already a big investor in Rivian? Yeah, sure.

22:58

So like looking deeper into that supply chain and there's a few other car companies he's been been involved in.

23:01

I just don't know that there's uh that like that's where the big opportunity is.

23:06

It might be deeper in in the supply chain like bending the metal that goes into the bumper that this and that and like you know it's 12 steps deep it's more boring but it's even thinner margins less you know brand risk and brand value but really focused on you know applying that actual like commercial excellence.

23:26

Um But but I mean truly like your your guess is as good as mine.

23:31

There's very little there's very little to go off of.

23:33

Also there's a link to project Prometheus which is the AI project and so there's a chance that like this whole project is more aligned with a software singularity software only singularity and you wind up with you know buying a lot of things but everything's in line with like more data centers and this is more of like let's put 100 billion dollars to work towards building you know compute capacity for project Prometheus.

23:58

[clears throat] That feels like not what we're hearing but it is it is one possible >> do anything on on like the solar side right?

24:08

Yeah yeah yeah that'd be interesting.

24:10

And then there's also the the option that we get some sort of Elon style mega corp with Blue Origin involved at some point.

24:15

Like you know XAI and SpaceX merged it's possible that Blue Origin and this vehicle come together with project Prometheus in some in some way and then that goes public as a new entity.

24:26

A lot of these he's he's actually mentioned the whole space data thing before. I think a while ago.

24:32

Wasn't it like more than a year ago? I don't think it was.

24:35

>> think they also just filed something with the FCC and they filed it was like 50,000 satellites I think.

24:42

>> Yeah yeah yeah so so he wants like a direct Starlink competitor and so when you think about the full AI stack if he's really you know off off planet you know pilled and thinks he can get thinks he can get there even if it's like a year or two behind or I guess what's the timeline for his Starlink competitor?

25:00

That would be like 3 years behind, 4 years?

25:03

>> Yeah, I mean for for for the moon he's supposed to be ahead, right? >> Oh, yeah. So.

25:07

Maybe this will all go on the moon.

25:08

Well, either way it's a big move from an experienced operator with lots of opportunity ahead and it'll be fun to follow along.

25:12

And I'm glad he's back in the game in a big way, not just doing random, you know, side projects, bottle service. >> Or bottle service.

25:23

He's got to be spending more time and energy securing America's future securing bottle service.

25:29

Well, you know, I mean the guy can take a weekend off, but one photo from his weekend flies a lot further than, you know, he could be completely locked in and just grinding 80 hours and then he goes gets bottle service just one time.

25:42

He was just there for 30 minutes.

25:44

>> Grinding on the yacht.

25:44

Not and maybe, you never know.

25:46

Anyway, >> [laughter] >> let's let's let's first tell you about Gusto, the unified platform for payroll, benefits, and HR built to evolve with modern small and medium-sized businesses.

25:55

And let's also tell you about Figma.

25:57

No matter where your idea starts, Figma, May Cloud, Code, Codex, or Sketch, the Figma canvas is where ideas connect and products take shape.

26:04

Build in the right direction with Figma.

26:06

And let's go over to Jensen on the All-In podcast.

26:13

I'm going to ask him how many tokens how much did you spend in tokens?

26:15

And that person said $5,000, I will go ape something else. >> Yeah, right.

26:21

>> [laughter] >> If that if that $500,000 engineer did not consume at least $250,000 worth of tokens, I am going to be deeply alarmed. Okay?

26:31

And this is no different than one of our chip designers who says, "Guess what?

26:36

I'm just going to use paper and pencil.

26:38

I don't think I'm going to need any CAD tools."

26:40

This is a real paradigm shift to start thinking about these all-star employees.

26:44

It almost reminds me of of what we learned in the NBA when LeBron James started spending a million dollars a year just on his health of his body like maintaining it.

26:52

Here he is at age 41 still playing.

26:55

It really is hey, if these are incredible knowledge workers, why wouldn't we give them superhuman abilities?

27:02

That's exactly what >> Where does that go if we if we extrapolate out two or three years from now, what is the efficiency of that All-Star at an Nvidia and what they're able to accomplish? What do they look like?

27:14

Well, first of all, things that that that wow, this is too hard. That thought is gone.

27:21

This is going to take a long time. That thought is gone.

27:23

We're going to need a lot of people. That thought is gone.

27:27

This is no different than in this in the last industrial revolution, somebody goes boy, that building really looks heavy. Nobody says that.

27:34

Nobody wow, that mountain looks too big. Nobody says that.

27:37

Everything that's too big, too heavy, takes too long.

27:42

Those thought those ideas are all gone. >> to creativity. That's right.

27:46

>> What can you come up with? Exactly.

27:47

Which means now the question is how do you how do you work with these agents?

27:52

Well, it's just a new way of doing computer programming.

27:53

In the in the past we code, in the future we're going to we're going to write ideas, architectures, specifications.

28:02

We're going to organize teams.

28:02

We're going to give them We're going to help them define how to evaluate the definition of good versus bad.

28:07

What's the What does it look like when something is a great outcome?

28:11

How to iterate with you, how to brainstorm.

28:15

That's really what you're looking for.

28:16

>> The internet is having a lot of fun with this.

28:18

Nuno Nuno says guy that sells shovels says you should spend 50% of your salary on shovels.

28:26

>> [laughter] >> But of course, Jensen's point is generally correct, which is that you should give your best people a lot of leverage.

28:36

Yeah, I do wonder what the like leverage ratio is in other industries.

28:39

Like if you're a crane operator and you're making I don't know If you should give him the best possible crane.

28:51

Yeah, like like is it possible that that if you're operating a $10 million crane or something I don't know how much crane cost or like a or a cargo ship cargo ship that's that's ferrying oil across the world.

29:04

Uh how much does that crew cost and then how much does the ship cost and then what's the depreciation on that ship because it might be like a $100 million ship that will last 20 years so you're looking at $5 million a year and if the crew total cost of the crew is like $1 million well then you're actually spending more on the capital

29:24

asset than the underlying talent and you're getting like leverage on top of that and for a long time software engineering has not been that it's been uh you know, $100 worth of internet and a couple thousand dollars on a MacBook and a lot of open source software cuz you're using Python and Linux and these things and um I mean I guess you could maybe

29:44

burden like your cloud budget once you actually deploy the app like if you think about if you're a Facebook engineer Instagram engineer you could push a feature that consumes a ton of compute but this is also going back to like the AI talent war where you get back into if you're if you're a you know, elite software engineer and you're

30:03

like look I'm going to be I'm going to be I'm going to be in I'm going to be in charge I'm going to be managing half a million dollars worth of token budget over the next year well I'm want comp that's higher than that or something like that that it'll be very interesting to see how the the the value works there. A reasonable ballpark for

30:21

A reasonable ballpark for the annual cost of a fully loaded cargo ship is around 4 to 18 million dollars so including the cash operating cost plus the depreciation.

30:33

So I don't know um yeah, the this certainly isn't like the first industry to be hit with something like that, but it'll be interesting to see how it changes.

30:46

Um anyway >> in other news, the US Department of Justice announced yesterday three charged with conspiring to unlawfully divert cutting-edge US AI technology to China.

30:55

The indictment unsealed today details alleged effort to evade [clears throat] US export laws through false documents, staged dummy servers to mislead inspectors, Wow.

31:05

>> and convoluted transshipment schemes in order to obfuscate the true destination of restricted AI technology, China.

31:09

Uh said John Eisenberg, assistant assistant attorney general for national security.

31:18

These chips are the product of American ingenuity and NSD will continue to enforce our export control laws to protect that advantage.

31:24

Uh so, the company uh SMIC, Super Micro Computer Inc.

31:33

They got the co-founder >> They caught him They caught him red-handed.

31:37

>> Wally, he's arrested today or yesterday.

31:40

He personally holds half a billion dollars of Super Micro stock, still risked it all, and now he's facing 30 years in federal prison. That is crazy.

31:50

Uh he's charged with smuggling billions in Nvidia servers to China use Southeast and Southeast Asian shell company to funnel two and a half billion in servers to Chinese buyers.

32:01

500 million worth shipped in just 3 weeks in spring of 2025. That's a lot.

32:08

Two and a half billion in servers feels like enough for like a frontier training run.

32:12

Like that's a big big uh that's a big push.

32:15

He built thousands of fake dummy servers to fool US compliance auditors, caught on surveillance camera using a hair dryer to swap serial number stickers.

32:25

And so, uh OX uh Gigi [laughter] says, "This man is a billionaire and was removing labels with a hair dryer personally.

32:32

You're simply not grinding hard enough."

32:37

There's always There's always a grind set lesson in any story like this. >> over to LinkedIn.

32:42

>> It's also notable because because the There's the export tax or tip that you know that you're trying to bring chips out of the country that that they the the US government kind of flips over the Square terminal and then say tip, please. >> Yep.

32:55

>> 25% so you're looking at at hundreds of millions of dollars if these were even if these were chips that were able to be exported.

33:03

>> We were debating the the flipping the iPad around asking for a tip earlier today.

33:09

And I think our our joint stance was if the iPad is turned around you got to tip. Yeah.

33:15

It's just the etiquette is that you got to tip.

33:17

Uh but is there any is there anywhere where that line crosses and you say, "I can't I can't possibly push something."

33:26

>> Funny thing is Erewhon asks for tips >> Really? on online orders. Online orders?

33:31

Wait, but there will be a human delivering it or No, there's two separate tips. Okay.

33:34

There's There's the the person in the store who puts the things Mhm.

33:39

in the bag and then there's the delivery person.

33:42

And they're at They They They flip it over twice. Yeah.

33:44

The game theory of this stuff is always hard because uh I feel like I don't know.

33:50

There's regulations on like taxes on tips, but it's very unclear if companies actually funnel how they distribute the tips.

33:57

Like are you tipping the person or the tips grouped together?

34:01

Were your tips pooled when you were a Uh yeah. They were pooled.

34:04

Uh so even if you did a great job >> at the hotel. The valets, they pool. >> Yeah.

34:12

Bell staff, the people that like take you down to your room, do not do not pool.

34:17

And that was just the rules.

34:19

Oh, it's because I might be the one who parks the car, you might be the one who gets >> Well, in a in a dynamic in a dynamic where you have a bunch of valets that are waiting for cars, it would be a bad experience for the guest if the valets are like they see a nice car pull in and they're like fighting over themselves. >> Sure.

34:35

to deliver service, right?

34:35

It should just be like whoever's available should deliver the best possible service.

34:41

Whereas bell work is much more one-on-one.

34:44

It's like I'm kind of your guide on the property.

34:46

I'm going to like, you know, you you might have the person's cell phone.

34:49

They might be texting you, etc. Interesting.

34:51

And so it makes more sense to not pool.

34:54

Well, tip your export control, tip your federal I did There there there I did have a funny story where there was a guy, a [ __ ] who used to come to the property and everyone knew that every >> [laughter] >> every single thing We still have We haven't successfully kind of willed it into existence. Not at all.

35:17

I think we're the only I think we're the only people >> [laughter] >> Wasn't We didn't come up with this term.

35:22

It was delivered to us and then we appropriated it. Um Anyway.

35:27

There was a guy who'd come to the property.

35:28

Any single thing he got help with on the property He'd tip?

35:31

He would just tip a hundred.

35:33

And so it what it did cause chaos because people would just be like if you like if you like >> your diet coke."

35:39

be like waiting around like trying to be in the right spot to open a door cuz they knew it was it was a bit It got a bit out of hand.

35:45

I saw I saw a piece of alpha on Instagram reels that suggested that you tip the front desk person when you're checking in before you check in.

35:53

Cuz you don't >> Yeah, that always feels like a bribe, but it is the right move.

35:58

>> But this is a big thing in Vegas, right?

35:59

You're supposed to put it in between when you give them the card. Oh, I saw this.

36:02

Yeah, you stack the credit card and the ID and you put the hundred dollar bill in there.

36:07

>> That's even more like deliver that, then then they have plausible deniability and they can be like, "Oh, like here you go."

36:12

Or they can be like, "Okay, thank you and I'm upgrading you."

36:14

And I think if at least this person on Instagram was making the case that if you if you average out your tipping a hundred dollars for every room and you're you're like a four hundred dollar room, but you get a $1,000 room upgrade every five >> The only durable alpha is like you you want to tip before the service occurs. >> Yes.

36:33

If you tip the valet when they they bring you your car, >> Yes.

36:39

you're How do they know what kind of service >> if you're ordering at Starbucks and you want to make sure that they're going to enter your order correctly and get your name right, you got to tip up front and then say what your order is.

36:49

Walk up to the counter, say flip it over. >> Flip it over. I'm tipping you first.

36:55

Now, let's start the transaction.

36:57

>> [laughter] >> Anyway, uh when a broker who had bought Nvidia-powered servers from the Southeast Asian company >> No, walk up to the walk up to the counter and say what's your tempo address. Oh, yes. Yes.

37:09

Send him a machine payment. >> Yes, automatically.

37:12

Uh Well, when a when a broker who had bought Nvidia-powered servers from the Southeast Asian company sent uh Sunny a text message containing a link to an announcement about Chinese nationals being arrested for smuggling AI chips into China, Sunny allegedly responded with sobbing emojis. Scroll up.

37:34

Scroll up so people can see.

37:36

>> Morning Brews says, "Hey, man, you're probably going to jail."

37:38

Supermicro co-founder cry cry cry emoji.

37:40

And scroll down and you'll see Nick Carter literally this, "Your son has passed away."

37:46

>> [laughter] >> And it's the warthog explosion. Oh, okay.

37:50

I guess we can't find it. It's weird. My ex is different.

37:51

Jordan Schneider apparently was all over this back in August of last year.

37:56

He said a Supermicro ad in the middle of a Reuters piece talking about how tracking devices and AI servers just priceless. Whoa. What did Jordan know? What did Jordan know?

38:09

>> Steve Alpha and China Talk.

38:09

Head Head over to China Talk and subscribe.

38:12

Uh he's got some amazing content, some amazing interviews, and uh is a good friend of the show.

38:18

And so, there's there's clearly secrets to be unveiled through the China Talk archive.

38:23

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What we >> Thank you to the Cisco team for sending us this us these mini McLaren helmets.

38:46

They're sponsoring McLaren. >> Very cool. And uh we are honored. Yeah, we love F1.

38:50

Uh I'm sorry, but the Supermicro thing is awful, but parts of it are genuinely hilarious.

38:55

They literally used a hair dryer to move serial numbers from real servers to dummy servers to throw in a warehouse and got caught on camera.

39:03

And the pictures have actually leaked.

39:06

>> Literally caught red-handed.

39:06

Yes, it's a red It's a red hair dryer.

39:09

That is That is remarkable.

39:12

Uh Trung Fan says, "Do things that don't scale." Classic founder energy.

39:16

Uh yeah, definitely definitely that.

39:18

Uh what else is going on?

39:20

Let's pull up this video.

39:20

I I don't know if uh if if Bone It's 6 minutes long.

39:26

>> the legend Bone But Chinese entrepreneur boasts receipt of 200 Nvidia H200 GPUs in Beijing despite the US export ban and then explains how he circumvents the export ban.

39:37

Wow, in January of 2020 >> posted by Beijing-based entrepreneur Su Di on the Chinese social media platform Douyin has sparked significant >> Wait, it's literally you can see Watch this. Watch this. Look at that. rewatch it for a second.

39:49

You can see a Supermicro logo on it.

39:51

entrepreneur Su Di on the Chinese social media platform Douyin has sparked significant discussion.

39:57

In the video, Su boasts of Oh [laughter] my god, that's like the biggest logo for Supermicro ever.

40:05

>> [laughter] >> Well, Bone Bone is Bone is absolutely correct. >> January.

40:11

No, I I I'm telling you like a lot of I mean I'm I'm I'm I'm the the the Justice Department were working on this like early in this, but a lot of times like legal action will happen like downstream of like YouTube drama videos.

40:26

>> [laughter] >> Like there will be some like, you know, fake guru who's out there like running a Ponzi scheme and people will be dunking on it on social media and then it will get picked up by the >> So almost a year and a quarter ago, somebody responded to bone and says it's SMIC packaged.

40:40

And bone says, do you think SMIC is smuggling chips? Wow.

40:46

And And the the host says it's possible it's a family family run business in Taiwan.

40:51

I won't be surprised if there are some family members who want to make this money by setting up fake shell entities and smuggling chips for business partners in China. Wow. It's good money. Wow. Wild. This is crazy. >> Wild.

41:04

Um Kevin Kwok has a good meme that everyone enjoyed.

41:07

They expect one of us in the wreckage, brother. And it's not Jensen.

41:13

>> [laughter] >> The Bane Bane meme. It's very very funny.

41:16

And yeah, the the SMIC founder I believe was at GTC just a few days ago. Oh, really? >> Hanging out. No way.

41:23

He was I I saw a picture of him with Jensen. Yeah.

41:25

Till the music stops playing, I suppose.

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41:43

Speaking of going insanely hard says Joe Wiesenthal.

41:45

I'm obsessed with the name of the rocket that will take the first Chinese astronauts to the moon.

41:49

It's called the Long March 10, the next generation crewed launch vehicle.

41:52

Long March is a great great name for just locking in.

41:57

The lock in the lock in rocket. Lock in rocket. >> And it's time.

42:02

What are we talking about? >> For Kimmy Gate. >> Kimmy Gate. What's going on here?

42:04

Then was So Cursor yesterday announced Composer 2, which apparently was composed of other models.

42:14

Did very well on cursor bench.

42:14

Little bit odd with the charts on the higher cost lower cost, but seem like it did well for cursors use case.

42:21

Cursor fans were satisfied I suppose.

42:24

Finn says that he was messing around with the open AI base URL in cursor and caught this account any sphere model Kimi K2P5RL and some other numbers.

42:38

So compute so composer 2 is just Kimi K2 with RL.

42:40

At least rename the model ID.

42:43

Well, the co-founder I believe or someone from cursor chimed in and said and said it is in fact RL Kimi K2 and this is why open weight rules.

42:55

We the consumers get new improved models with minimal cost and it's Lee Robinson who is teaching developers at cursor.

43:04

Lee Robinson says yep composer 2 started from an open source base.

43:11

We will do full pre-training in the future.

43:13

That's an interesting claim.

43:16

I'm wondering if they even need to.

43:16

I don't know that there's any problem with using an open source model here.

43:20

He says only 1/4 of the compute spent on the final model came from the base.

43:25

The rest is from our training.

43:28

So they took whatever compute went into K2 and then they 4x that or 3x it and and drop that into RL.

43:34

This is why eval's are very different and yes, we are following the license through our inference partner terms. So I don't know.

43:40

They're they're they're they're staking out their claim.

43:44

They're making their their their their strategy known.

43:48

Jack Morris says people are taking this the wrong way. Look at it like this.

43:52

Composer 1 deep seek probably.

43:52

Composer 2 Kimi certainly.

43:54

Composer 3 likely will be the first frontier base model pre-trained from scratch for a single domain coding.

44:01

It's a scary thought, isn't it?

44:03

And so people are taking both sides.

44:05

Tyler, do you have a do you have a take on this?

44:06

Yeah, I mean I think it's like very reasonable to to do RL on a on like some open source pre-train.

44:12

Like that's makes a lot of sense, right?

44:14

Cuz like you can kind of imagine that there's this dynamic where there's post about this we can talk about.

44:18

But I'm like So so there's all this stuff about how okay, Claude Anthropic trains a model and then Chinese inventors labs kind of distill on it. >> Yeah.

44:28

You know, the actual implementation of how they distill it doesn't maybe doesn't matter that much.

44:32

But you're kind of getting some form of like You know, a little bit that's open source.

44:35

And then you take that and then you can do RL to do like a specific hill climb on on some task like best coding.

44:40

And that's that's like a very good way to to make good model, right?

44:43

So Prime Intellect their most recent release was I think it was GLM like 4. 5.

44:49

And then so so they take that base model and then you do RL on that and you get this really great model cuz like RL is like where you can get a lot of these like small Small gains.

44:57

These small gains on specific task which which can build up over time.

45:01

So I think it like makes a lot of sense.

45:02

It's not like a big dunk to be like, "Oh my gosh, they were just doing RL on some open source model."

45:07

Like It's a very logical strategy.

45:07

Yeah, that like makes a lot of sense. Yeah.

45:08

I think the criticism of I I think >> [clears throat] >> I think they probably should have come out and said they did it and not try to position it as like we did a They said what?

45:20

There was this was our first continual pre-train. >> pre-train.

45:26

>> So they're kind of like using that using that word like it would have been easy to be like, "We took We took world-class open source models and improved them in order to create a frontier model." >> Yeah.

45:38

>> people would have been like totally fine with that, right?

45:39

Prime Intellect I mean a lot of you know, American labs have done this and said it and everyone's like, "Wow, this is great. This is a great model.

45:45

I'm you know, excited to use it."

45:46

Yeah, and didn't didn't Perplexity at one point create like Deep Seek 1776 or something like that where they were like, "We specifically made it more American."

45:54

>> After I will say after I actually >> Oh, after you did that.

45:57

>> [laughter] >> So funny that you did that.

45:59

Um Sefari says Cursor browser treating Kimmy like Voldemort.

46:06

The No, I don't want to say the name.

46:07

He did in fact put it in a post. Yeah, yeah, yeah.

46:11

Um, accelerate harder says the funny bit is training from scratch and presses investors in Twitter, but it makes little sense for most teams while still while strong open source options exist.

46:20

So Cursor actually did the smart thing, but pretended they did the dumb thing and it nearly worked.

46:24

So more of maybe a comms issue than a business strategy issue, but uh you know, we'll we'll see what the >> think there are some concerns maybe about the actual license of the model because you know, technically like you you are supposed to say uh that that it is like Kimmy Yeah, usually you have to pass through these things.

46:41

Like Android is built on Linux and and that's in the you know, release notes.

46:45

>> likely to be some deal behind the scenes that actually means it's fine. >> Yeah.

46:48

I also I would not be surprised if people have just not read the the like the the composer two license doc yet or something and like it's actually just fully disclosed there and then people are like, I found it in the URL.

46:58

It's like it was also in the terms of service.

47:01

Like it was just in plain text somewhere that you just didn't find. Who knows? Uh, let's see.

47:05

So 3x Ellie is giving some some comps on this.

47:10

So 3x the training compute gets you a 1% improvement on on Terminal bench 2. 0, but K 2.

47:15

5 in is in non-thinking mode.

47:21

If those benchmarks are useless, it's weird that they're the ones reported in the Cursor blog then something is wrong.

47:26

So people are going back and forth.

47:27

But ultimately I I I think this uh you know, the where the rubber meets the road is ARR.

47:31

Like Cursor has been growing.

47:34

Cursor continues to continues to grow even uh even while they've, you know, been like steamrolled and the vibes have shifted.

47:41

Uh, if people love this and people are using the product and it's a growing business and the market is growing so fast that they have a great business.

47:48

Um, that seems like uh you know, business continues as usual.

47:51

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48:07

So, uh should we move on? Delvegate, another gate. Another gate, Delvegate. So, what happened here?

48:13

Where where where where should we start?

48:15

Uh anonymous Substack pops up.

48:16

Yeah, these anonymous substacks are interesting.

48:21

Deep Delver, clearly created just to share this particular story. No idea who's behind it.

48:27

>> Yeah, incredible incredibly professional Okay.

48:31

>> in their presentation, right?

48:31

They're putting backups of the article. >> Yeah, on day one.

48:36

>> reporters who want to get in touch. >> Yeah.

48:38

Uh they're sharing a pro proton.

48:42

Um and so, yeah, they they make an argument that uh Delve has had a a bunch of kind of nefarious activity, kind of duplicating reports, not basically just like a lot of their value prop I think was on the fact that they were using AI and speed.

49:01

And uh yeah, doesn't look good at all.

49:07

>> believe we've had Delve on the show, but I searched the calendar and I got one hit for Delve and it's in >> [laughter] >> it's in a summary.

49:14

It's in a a summary of uh of Bill Gurley's book that says it's a page turner that delves deep into the surprising, often zigzagging career paths of exceptional performers.

49:25

There's something inspiring on every page is a quote from the New York Times best-selling author that he gave to Bill Gurley's book and just got sort of wound up in our notes.

49:34

Anyway, uh so so what actually happened? What is Delve? Let's let's start there.

49:40

>> Delve does SOC 2 compliance and HIPAA compliance.

49:43

They've worked for a number of companies like Lovable, Cluey, etc. etc.

49:50

And uh yeah, you can kind of I mean that the article is like very very very long okay and detailed, but it just goes into >> Erin Griffith shares like the key claim.

50:04

Erin Griffith uh of course is over at the New York Times.

50:07

Uh and she quotes this, "Delve built a machine a machine designed to make clients complicit without their knowledge to manufacture plausible deniability while producing exactly the opposite."

50:19

Um and a lot of people are having fun with the fact that the Delve founders were in the 30 under 30, which of course has uh surfaced a lot of people.

50:27

I think there's are there really 1,800 30 under 30 every year? That's true? Yes.

50:31

Or is that like uh is that like DocuSign?

50:36

>> you were saying I I thought you were saying all in. Oh, maybe maybe overall.

50:40

I know that there's multiple categories.

50:41

So, there's more than 30. >> was just >> Yeah.

50:45

And then Forbes realized like, "What if we scaled this?" >> Yeah. This is the plan. Scale the Midas list. 100 Midas lists.

50:51

So, you get 10,000 VCs paying you top dollar to rank. It should be an auction.

50:56

Uh so, Austin Peter Smith says uh "Not going to lie.

51:02

As we've been going through a grueling SOC 2 process with Vanta, one of our sponsors, I have felt a lot of FOMO reading about Delve customers getting it done in 3 weeks.

51:09

If all this is true, then no more FOMO.

51:11

So, uh he's Milo >> There are some things that you just can't short.

51:19

Uh Milo uh pulled up a post from the CEO from April of last year that says uh the CEO says, "When you step into the office and your founding AI engineer is on his third all-nighter.

51:31

The team never stopped stopped shipping."

51:33

Milo says, "Third all-nighter of what? Compliance?

51:34

I don't want my security company shipping 3:00 a. m. code."

51:39

So, uh un- very unfortunate situation.

51:45

Uh not going to make any Mhm.

51:45

any real assumptions, but uh uh, this story is definitely not over.

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52:12

>> Okay, so this snake post.

52:13

>> We're not We're not doing the snake post.

52:14

We're skipping No, I hate snakes.

52:16

We're not We're not doing I refuse to pull up a snake post.

52:18

We're skipping straight to Bruce Lee.

52:23

>> Okay, this We're skipping way down.

52:25

We're watching the Bruce Lee snake post.

52:26

>> John watch a snake video even though he wants to close his eyes. >> saw it. I saw it. I hate snakes. I'm Irish. No snakes in Ireland. No snakes on TV. Snakes are banned. I'm Irish. No snakes in Ireland. No snakes on TV. Snakes are banned.

52:39

You got to do that bit where somebody attaches like a a rubber snake.

52:43

>> will not do that to me.

52:43

Under no circumstances will you do this.

52:45

We will be watching Bruce Lee fight Chuck Norris in The Way of the Dragon because this is the way that we pay our respects to Chuck Norris who of course passed away at the age of I think 86. Norris.

53:02

>> [screaming] >> He was 86.

53:06

And this is one of the most iconic fight scenes in movie history.

53:12

Have you seen The Way of the Dragon? Of course I have. Of course you have.

53:17

>> [clears throat] >> This scene was unique.

53:23

It was set inside Rome's Colosseum.

53:26

And it was often cited as a turning point for how martial arts were portrayed on screen.

53:32

Uh, particularly because they didn't use actors.

53:33

So, both Bruce Lee and Chuck Norris were legitimately high-level fighters.

53:38

Norris was world karate champion at the time they cast him in part because of that.

53:43

Uh and it has a much more like grounded credible feel as opposed to like previously like more stylized uh kung fu films.

53:50

And and you can see this with the uh Bruce Lee actually directed and choreographed this himself. So Lee had full control.

53:57

So the director didn't say anything.

53:59

And they do these cool like punching shots. Look at this.

54:02

So you're seeing nice wide.

54:02

You can see exactly where he is. There's no body double.

54:06

And then we're going to zoom in.

54:08

And then what are we going to do again?

54:09

We're going to zoom in again.

54:12

And so we see his face and he's just sitting there waiting. Brilliant shot.

54:14

So so much time to breathe and understand and feel what he's feeling.

54:22

The music, footsteps, breathing, clothing movement, the cat of course. Any snakes? Yeah.

54:29

No snakes, I don't think.

54:29

I haven't watched the whole thing.

54:32

>> [screaming] >> The camera often stays wide.

54:32

This is this stands in contrast to something like the Bourne Identity. Very like fast cuts.

54:39

>> Close-ups, much easier to get something that feels intense [music] when you're cutting and chopping.

54:43

It's much harder to make something like this where you see the full body, you see now we're in slow mo.

54:49

They're they're they're they're shotting back and forth.

54:52

The empty arena gives a gladiatorial vibe.

54:55

A sense of ritual combat.

54:58

Visually frames the fight as mythic, not just physical.

55:03

Bruce Lee is learning mid-fight.

55:03

Norris has the edge with his rigid karate form, but Lee adapts.

55:08

He loosens his stance, increases in his mobility, switches his rhythm.

55:12

We got to talk over it or else we get demonetized and banned.

55:14

So >> [laughter] >> I got to I got to I got to figure it out. Uh anyway.

55:21

Uh We're very we're we're we're very sad that uh that he is no longer with us, but uh he leaves behind a massive legacy and a portfolio of films including the you know, TV shows as well.

55:31

Walker, Texas Ranger, which was constantly on TV when I was a kid.

55:35

Well, rest in peace to a legend.

55:39

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55:53

So, Bernie Sanders >> Yes.

55:56

had a conversation with Claude.

55:58

>> Video was posted yesterday. >> Yes.

55:59

Justin Moore says he did the meme. He did the meme.

56:03

>> Bernie says, "Pretend to be a scary robot. I'm a scary robot." [laughter] Yeah, yeah.

56:07

Taylor Lorenz chimed in on this, too.

56:09

Said, "This reminds me of that tweet was that was like typing I'm evil into a Google Doc and getting scared."

56:15

Uh yeah, there's a little bit of that.

56:17

Will Manidis had another take.

56:18

He said, "A trillion dollars was spent on AI risk teams and no one thought to hardcode into the model to not tell Bernie Sanders that you do crimes." Very funny.

56:28

Uh but this is the correct way to disclose that you're talking to an AI model.

56:31

Yeah, do you think he was inspired by the Vanity Fair piece and then immediately shipped this?

56:34

The Vanity Fair piece like buried the lead and like it was it was it was surfaced in uh a bunch of screenshots later that made it look like the entire article was AI-generated, which it wasn't.

56:43

Like the Vanity Fair article did have access to a bunch of people and there are some interesting vignettes in there.

56:48

But this is very clear from day one what's happening.

56:52

Like he's talking to Claude and he's investigating and and you know, sharing his fears and I think this is a great way to actually share what you're doing and make it very clear.

57:04

Uh and so, uh people are mixed on this.

57:07

Uh Miles Brundage says, "Worst part of the Bernie video is using [laughter] Sonnet.

57:10

Not sure why folks are so mad about the other stuff." That's very funny.

57:16

>> Uh Hope >> Tacos Delicious Tacos Uh yeah. >> spoke to Grok.

57:22

>> [laughter] >> It's Bernie like this and then No, no, don't don't click that.

57:26

But you can imagine what happens there.

57:27

[laughter] And then uh yeah, >> Hope's Revenge did made the card for us. Thank you. Signed. >> in the It's great.

57:34

Anyway, let's move over to Montana.

57:36

One and only Moonlight Basin.

57:39

There's a property that made it into the timeline. Ooh, indoor pool. Okay. Okay. Ooh.

57:50

I saw some promotional material for this.

57:51

It is It is absolutely stunning. >> Okay. Yeah, yeah. Yeah. That's cool. Does it have zebras? Not No zebras.

58:20

>> Does it have tortoises? For 5.

58:22

1 million, this safari-like estate comes with zebras.

58:25

>> Oh, you got a solution to my problem. I need zebras.

58:28

>> Animals roam free at California's 137 Oak Hill Preserve, which has a five-bedroom lodge and a helipad.

58:32

I'm loving this sound of this. >> Okay, wait.

58:38

I I can't believe the the value here.

58:42

I feel like anything that has zebras and tortoises should be up in the double digits.

58:47

>> I don't know how much it costs to get a zebra, but you should get like a 10x multiplier on it. Yeah, for sure.

58:50

So, It's like having It's like having an AI researcher.

58:55

He visited Africa for the first time in the '80s, he said, but his heart never left.

58:58

He He proposed to his now wife, Bernadette Craft, in a hot air in a hot air balloon. That's elite.

59:05

Above the Serengeti National Park.

59:05

The couple got married in Nairobi, Kenya, in 1990 in 1988.

59:09

And two decades after two two decades ago, after taking their three sons to Victoria Falls in Zimbabwe, Brian started wondering how he could bring some of the African experience closer to home.

59:20

Can I recreate a mini Africa that's a short distance away from our house?

59:23

Thus began a years-long process of developing roughly 137-acre safari-like sanctuary in Ione, California. Is that Ione or Ioni? I don't know.

59:37

Uh with a helipad and a collection of animals including tortoises, alpacas, East African plains zebras, and uh cattle. >> Aoni, okay.

59:45

Uh so now approaching the age of 70, Kraft, who is a commercial real estate broker, entrepreneur, and aspiring screenwriter, is listing the vacation property for $5. 1 million.

59:54

Approximately 15 animals are included in the offering.

59:57

That's only uh less than a 10x multiple per animal.

1:00:04

Uh known [snorts] as Oak Hill Preserve, the estate is about 40 miles from Sacramento, where the Krafts live.

1:00:09

The animals roam freely on the property with access to plenty of water and grass.

1:00:12

Kraft likes to drive around the estate in an old pickup truck he outfitted with benches in the back and lights in the front and rear.

1:00:17

The idea is to go looking for animals like you would on a safari.

1:00:22

Kraft assembled the property by buying three separate parcels over a 5-year stretch starting in 2007.

1:00:26

It had the right amount of open space like a savanna and the right amount of trees like you're in a thicket.

1:00:31

Kraft [snorts] improved the land, a former cattle ranch, bit by bit starting with no-climb fences, roads, and underground power lines.

1:00:38

Throughout the property, Kraft said he tried to evoke Africa with curved roads and buildings with rounded edges.

1:00:43

One of the first structures he built was a bunkhouse for a group of friends.

1:00:47

"I've got a group of knuckleheads," he said.

1:00:48

"I did it with them in mind. It was a guy thing.

1:00:50

The wives put it put up put up with all of us."

1:00:55

If someone says knuckleheads and you don't immediately think of a specific group This is amazing that it's in California.

1:01:02

Just driving around this California estate and just seeing zebras roaming is amazing. Ostriches.

1:01:11

>> This is This is a treat. This is a treat.

1:01:13

Uh a few years ago Kraft said his friends chipped in to buy him a Jeep with animal print paint.

1:01:17

"We were all having breakfast.

1:01:19

All of a sudden, I hear the theme of Out of Africa." he recalled.

1:01:22

Then one of the guys pulled up in the Jeep. It was quite a surprise.

1:01:26

He completed the main lodge on the property around 2018 spanning around 4,200 square feet. It has five bedrooms.

1:01:32

There's a cafe for dining near a creek in the property as well as entertaining space that Kraft calls the cigar bar.

1:01:41

John, you have to get this place. This is extremely me. This is so you. >> This is extremely me.

1:01:47

Um Kraft said that he is at the estate every week.

1:01:50

It's basically just a family getaway.

1:01:53

His children and their friends spend their spend time there, too, and his oldest son got married there. Wow. Why why is he selling? >> Why is he selling? What's wrong?

1:02:00

This is This has got to be some Jurassic Park style thing where like he's been doing some rare zebra crossbreeds that are about to take over.

1:02:08

He was like, "Yeah, the electric fence works well. It's no climb."

1:02:12

You're like, "But they've learned to fly."

1:02:13

I'm not I'm not exactly sure.

1:02:16

The property has as many outdoor amenities including basketball court. That's going to be big.

1:02:20

Basketball's making a comeback.

1:02:23

Kraft said selling has been a sweet, but he promised his wife to list the property when he turned 70. Oh, okay.

1:02:29

That's when that's when you should be selling your primary home and moving to the to your to your ranch.

1:02:36

>> Okay, I'm I'm How far is it? Ione?

1:02:38

>> Ione in Amador County is home to wineries and equestrian properties and it has become a second home market for people from the Sacramento area.

1:02:43

The local luxury market is strong.

1:02:46

Yeah, it's really far, but it has a helipad.

1:02:50

Yeah, 6 hours 6 and 1/2 hours straight shot, maybe 7 hours straight shot in the car.

1:02:54

But if my plan to ban speed limits happens and you can drive there 200 miles an hour instead of 65, you'll get there in 2 hours.

1:03:04

>> It's a flat 2 hours right now from San Francisco, but get this, but by train, it'll only take you 6 hours.

1:03:12

>> [laughter] >> Wait, did you guys miss this line?

1:03:15

It says one of friends discovered what he believes to be a century-old gold mine. Wait, really?

1:03:21

Okay, he's just prank- he's pranking everyone right now. >> This is crazy.

1:03:25

>> He just I think he wanted to just show off his I think he just wanted to show off his ranch.

1:03:28

So, he's like, "Yeah, I'm selling." >> I'm selling.

1:03:30

He's not selling this thing. >> There's no way.

1:03:32

He just wanted the He just wanted the journal feature.

1:03:34

We do We do need to get this guy on the show, though.

1:03:37

He seems like he's just had a great life and great time.

1:03:39

Seems like a good good person to learn the the ins and outs of commercial real estate from.

1:03:45

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1:03:53

And somebody who is selling is Orlando Bloom.

1:03:57

He put his long-time Malibu home on the market for $12 million.

1:04:02

He spent millions redoing the four-bedroom house. Now, it's for sale. It can be you.

1:04:07

It is above El Matador State Beach.

1:04:09

You're going to have to tell me if that's a good beach.

1:04:10

Is this a >> It is a fantastic beach. >> Okay.

1:04:13

It was the actor's primary home for a full decade.

1:04:16

>> A lot of tourists there. A lot of tourists, okay.

1:04:17

Which is somewhat of a downside.

1:04:21

>> somewhat of a downside, okay.

1:04:21

So, it's in a gated community.

1:04:23

>> It's in a It's in a gated community.

1:04:25

Only Jordi can tell us if it's a goated community, though.

1:04:29

The Malibu house has interiors by the artist and furniture designer Roy McMackin.

1:04:34

Bloom did an extensive renovation that cost more than twice what he paid for the house.

1:04:38

He bought the house in uh uh where he bought it in Sold he He sold a separate Malibu house in 2024 for 4. 1 million.

1:04:47

How much did he actually buy the house for? I forget, but 2. 5 >> 2.

1:04:52

5, and then I guess he spent more than five renovating it, and now he's looking for 12.

1:04:56

So, he said he's reluctant to let go of the Malibu house, but he rented it out last year and realized that he likely was not going back there.

1:05:04

"It felt like it might be the right time to let it go," he said.

1:05:06

And he's somebody that picks up the phone when the Journal's calling, which we love to hear.

1:05:13

Uh listing agent is Somebody you Chris Cortazzo. No way. Again. Cortazzo.

1:05:20

>> Chris has almost half of all the high-end listings in Malibu.

1:05:25

>> know how he described the ground floor when Orlando Bloom bought this house?

1:05:31

He described the ground floor as a bit higgledy-piggledy.

1:05:35

>> [laughter] >> Which is a great line.

1:05:38

>> [gasps] >> Yeah, it was a bit higgledy-piggledy.

1:05:40

But I needed it for my knuckleheads.

1:05:42

Needed it for my knuckleheads.

1:05:44

He said he's got the most amazing drives through the Malibu canyons.

1:05:46

He's very >> That is true.

1:05:48

>> So it has a pool, a jacuzzi, and a sauna, I believe.

1:05:52

Um and so uh you can go check that out.

1:05:54

There are There are some other amazing properties in the mansion section, but we will have to get to those later.

1:05:59

First, let me tell you about Vanta.

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1:06:09

And without further ado, let's bring in our first guest of the show, RFK Moore, who's in the restroom waiting room.

1:06:16

We'll bring him to the TPP and Alfred Dunhill, who's a menswear insider.

1:06:21

And we can give him a couple minutes because there is a tequila billionaire who is selling a Balinese-style Hawaiian home for $32. 5 million.

1:06:32

It's designed to look like a temple.

1:06:32

The house on Keholo Bay was built in Indonesia, disassembled, and then rebuilt in Hawaii. That is crazy.

1:06:41

Billionaire John Paul DeJoria's Hawaii home has traveled almost as much as he has. >> this home. Bring it.

1:06:47

>> the home and bring it >> to another That's pretty remarkable. >> island.

1:06:50

So in the '80s, he had uh the the Balinese-style Balinese Bali from Bali uh that home designed and constructed by artisans in Indonesia, then disassembled and shipped to Hawaii's Big Island, where it was rebuilt on a waterfront lot.

1:07:07

The process cost a couple million dollars.

1:07:09

He's a co-founder of the tequila brand Patron and the hair care products company John Paul Mitchell systems.

1:07:15

Now the property with shingled roof designed to resemble dragon skin is coming on the market for 32. 5 million.

1:07:23

What a remarkable property.

1:07:23

You really haven't lived until you've gotten food poisoning in Bali. I've never been. Have you been to Bali? Couple times. >> Surfing? Yes. A couple times.

1:07:31

Isn't it a really really long flight? It's a terrible flight.

1:07:35

>> It's a terrible flight, right? It's very inconvenient.

1:07:37

>> It's especially when you're college kid and you're broke and you're just like I I used to with surf trips I'd go and I would just search the rough dates that I'd want. >> yeah.

1:07:47

And then I would just buy the cheapest possible flight. >> Yeah.

1:07:50

Which would usually involve like a 17-hour layover in like the worst place on earth. >> Amazing.

1:07:55

But I would do it because my time was basically worth nothing. Love it.

1:08:00

>> [laughter] >> And it was worth it.

1:08:00

But shouldn't you have just gone to an island that's has similar like features closer?

1:08:09

Like we have the Caribbean.

1:08:09

Is there not good surfing in the Caribbean? >> No. No? >> It's actually yeah.

1:08:14

>> surf in the Caribbean.

1:08:14

No, no, it's not to say there isn't good surfing in the Caribbean. >> like Bali.

1:08:20

>> But the Caribbean all areas are seasonal, right?

1:08:23

So different times of year it's going to be better conditions, but the Caribbean you have situations where like it's really good for 6 hours and then it's flat. >> Okay.

1:08:34

Whereas Bali you're going to have like more consistent surf and it's an island so you can like go around it depending on the conditions and whatever swells. Okay.

1:08:42

Well, I believe we have our next guest in the restroom waiting room.

1:08:46

So let's [music] bring in RFK Jr. into the TVP show. How are you doing? Good to meet you.

1:08:51

Thank you for taking the time. How are you? >> What's going on? Boys, how's it going? It's fantastic.

1:08:58

And you're looking sharp. >> of the weekend. You are looking sharp.

1:09:01

All right, we love having anonymous commentators on the show.

1:09:04

What can you tell us by way of an introduction? What is your focus?

1:09:09

How would you introduce yourself without doxing yourself?

1:09:15

Uh yeah, big big fan of menswear, big fan of the clothing industry, brands, apparel, products.

1:09:20

Uh I've worked in worked in men's brands in the industry for over 10 years now. Overnight success.

1:09:29

>> It also says here you're a hotel bar evangelist. Explain that. That's right. Yeah.

1:09:33

What's so special about a hotel bar versus just a normal bar?

1:09:38

I uh It's an elevated experience. >> Why?

1:09:40

It doesn't necessarily need to be an elevated experience. >> out. Why?

1:09:43

They don't know about hotel bars.

1:09:45

They don't know about it.

1:09:45

They don't know about it.

1:09:46

They don't follow RFK more yet. >> Okay, okay.

1:09:49

It's uh it's a bit of a it's a bit of a filter, you know?

1:09:51

You don't always have uh you don't always have people wandering in off the street.

1:09:56

Sometimes the bar you have to go through the lobby to a room to a room and just kind of filters people out, you know?

1:10:04

Uh I wanted to get the update on the menswear industry broadly.

1:10:08

Where the like what's happening in clothing.

1:10:11

Who's the biggest winner right now?

1:10:13

Yeah, who's the big Yeah, who's who's the biggest winner?

1:10:16

>> Yeah, who's on an absolute uh like generational run?

1:10:21

Uh I mean on on the on the the largest level uh I don't really I don't really know in terms of luxury or or those like major players, but on on the more like specialty sort of scale, probably Buck Mason, you know?

1:10:43

Kind of big in the conversation.

1:10:43

They're uh opening tons of stores.

1:10:46

I think they're up to like 50 or 60 stores now and >> Wow.

1:10:51

Um men's from what I last heard, men still drives uh pretty sizable portion of the business, which you don't really see.

1:10:58

Usually women's overtakes as soon as you introduce it.

1:11:02

Um, so yeah, probably that.

1:11:04

>> So even So So would you expect at some point women's to overtake men's at Buck Mason, or is it just the name is like so it's just incredibly masculine.

1:11:16

But maybe there's still an opportunity there.

1:11:18

>> I would probably I would probably expect it to From what I hear, it's doing really well.

1:11:21

They have sort of a good like foundational business going with t-shirts and sweats and sort of like coastal, you know, linen and good fabrications.

1:11:32

Well, I would say that a large part of their success is that they put a vintage Porsche in their stores, right?

1:11:39

Yeah, have you guys ever seen the Porsches they have in the stores?

1:11:41

>> They do they actually?

1:11:42

>> went to that suit fitting with uh Yeah, yeah, yeah. uh The Mr. It was at a Buck Mason. >> Oh, that was? That's a Buck Mason.

1:11:48

>> And they did have a vintage Porsche Yeah, yeah, yeah.

1:11:51

>> Yeah, where where did that trend come from?

1:11:52

Is there like a clear lineage, or is it just like a broad trend?

1:11:56

We need We need You know you guys know Know Your Meme where it like traces the origins of every meme?

1:12:00

We need to Know Your Porsche. Yeah. Um, I don't know.

1:12:02

I I I know that ALD had the the Porsche in their little Soho pop-up that they did for their Porsche collaboration.

1:12:13

And that might have predated any any Buck Mason. Yeah.

1:12:17

Yeah, I I mean it it makes total I mean I it's funny cuz I've always appreciated I I I really love your posts when when you're just kind of joking around be like, "No, they couldn't possibly put a put a car in their in their retail store because it is so cliché now."

1:12:30

But I think it I think it's a way for it's just a way for a brand to signal like who they are because cars are extremely personal.

1:12:39

It says, uh "If you're a car person and you choose to invest your money in cars, your car does say something about you, whether you like it."

1:12:48

Yeah, I would love to walk into a menswear store that had like a Dodge Viper sitting there, like SRT, or yeah, maybe uh like a Dodge Durango SRT or like [laughter] a deal.

1:13:00

I'm sure we can find I'm sure What?

1:13:03

>> What's that one that they always played the loud music out of?

1:13:05

>> Oh, is that the Ariel Atom?

1:13:05

No, I I slingshot or something.

1:13:08

I forget what it >> Slingshot, yeah.

1:13:10

Who's going to be the first?

1:13:11

Who's going to stand up and be the first? >> That would be good. I like it.

1:13:13

I would I would challenge What What is What is actually going into How does a brand thrive today?

1:13:18

Everyone knows that apparel brands, uh you know, you you're put it you're having to spend so much money on inventory.

1:13:24

You don't necessarily know what's going to be hot.

1:13:28

Uh but what is What are the the brands that are doing the best in menswear doing from a supply chain standpoint?

1:13:35

Are they, you know, leaning into US manufacturing?

1:13:37

Are they uh are they are getting uh are they still like dependent on on uh Asia or or Latin America?

1:13:44

What's What's the approach that's working?

1:13:50

Uh yeah, I mean, there's no one, in terms of supply chain or or sort of like the the operational side of the business.

1:13:56

I don't think that there's one model that that you have to adhere to.

1:14:00

I know that COVID really scared a lot of um brands into diversifying their supply chains.

1:14:07

There were some brands that were just super super heavily concentrated in China, even with just one vendor base.

1:14:14

And so, that's really forced people to look into Latin America, India, um different areas like that.

1:14:18

But um as far as like what drives success, I think community is is more important than it's ever been.

1:14:28

Um you know, you you look at the the run of the >> actually What does that actually mean, though?

1:14:33

Cuz usually when people like for example, like I've bought a bunch of stuff from Buck Mason over the years, but I've never been like identifying as like I'm in the Buck Mason community.

1:14:44

>> Community to To it mean like you walk in and there's you know, you got your you you your Dodge Viper there and then they they hand you a white monster and there's like a mosh pit that you can like go and like thrash to like Limp Bizkit with in and like you're going to be fighting guys in the mosh pit but you're going to be building community through that. Got it.

1:15:02

>> That's what it means to me. Okay.

1:15:02

But Maybe you have a future in men's work. I think so. It's possible. >> like it.

1:15:08

You're looking You're looking dialed.

1:15:10

You're kind of mogging Jordy right now. I know.

1:15:11

Yeah, casual Friday over here has has crept to everyday.

1:15:16

>> But you almost wore jeans to I I was very close to wearing jeans but I did throw on the the dress pants.

1:15:20

Uh walk me through the guide to visiting New York.

1:15:24

We we head to New York every once in a while.

1:15:26

We're usually at the New York Stock Exchange downtown.

1:15:27

I believe it's in downtown Great South Bay.

1:15:32

Uh where's the best place to live?

1:15:32

Where's the best place to hang out?

1:15:34

What's the guide for the the the West Coast fellow who's visiting or or planning to move to New York? Yeah.

1:15:43

Um everyone's got different That's kind of the cool thing about about Manhattan that there's kind of different flavors depending on which neighborhood you go to.

1:15:52

Um I think the Upper East Side is coming back.

1:15:57

People are are rediscovering the Upper East Side like kind of like they're the first ones to do it which is funny but >> [laughter] >> my favorite neighborhood still is like the NoMad Flatiron uh sort of area.

1:16:09

It It's central but it's it's not uh it's it's not in the middle of anything if that makes kind of sense.

1:16:17

Does the city feel like it's back because there was a lot of like doom and gloom over like Mom Donny everyone's going to move to Florida.

1:16:24

Everyone's going to leave and but what's the actual vibe on the ground been?

1:16:30

I Yeah, I I think it's the same as it's always been.

1:16:33

I think you know, you walk around anywhere anywhere busy.

1:16:38

Uh you know, you go to any of like the shopping areas whether it's Fifth Avenue on Flatiron or you go to a a nice a nice restaurant somewhere that's popular, they're they're slammed and they're impossible to get into.

1:16:48

So, I don't I don't think What is your pitch for tech people who want to dress more who want to elevate their wardrobes in New York specifically?

1:17:03

I feel like the finance guy has some sort of shape to them that's been established going back.

1:17:10

There's lots of great reference points.

1:17:12

You can say I'm a Gordon Gekko guy or I'm a Patrick Bateman guy or there's plenty of like iconic cinematic portrayals of the Wall Street guy.

1:17:20

Uh less so in New the New York tech scene and the New York tech scene is certainly growing and it feels like it has an opportunity to to distinguish itself from the Silicon Valley scene. Um I don't know.

1:17:33

I think you can just establish like a tribal council of of tech leaders to to really hone in on the personal aesthetic.

1:17:41

But, if you're an individual, I mean, I think a uniform is always a great place to start.

1:17:44

Just pick a couple of good things, a top, a bottom, um and then buy buy really good versions of those things that are are obviously well-made and that fit you really well.

1:17:56

You need to take them to a tailor or whatever to make that happen and that's good, too.

1:17:59

And and then just buy multiples.

1:18:01

And then from there, you can kind of introduce maybe a uh stylish piece that that you found really interesting that you know, it just happened to be uh kind of like a one-and-done.

1:18:13

Uh what's going on with various life lifestyle brands and different kind of subcultures, whether that's running or golf?

1:18:21

Are they all going to converge on a long enough time horizon because they need to to scale?

1:18:25

What what are you seeing there?

1:18:30

Well, you I don't know if you saw my tweet about Malbon.

1:18:34

Uh I guess they're converging.

1:18:34

They're just they're just grabbing it whatever height uh they can find transitioning from golf into into run clubs, but I don't I I don't know. I mean, it's hard.

1:18:46

Like, if you look at the hardcore running brands that are kind of driving the culture right now, Bandit, Satisfy, um there's a couple smaller ones like uh Ruvvo or I don't even know how to say it. Um in the UK. Uh Soar.

1:19:03

I Could you Could you imagine a world in in which they they pivot into golf or or they expand, I guess better phrased, into golf? I don't know.

1:19:09

I think that would feel kind of disingenuous and and you'd end up with this like disparate feeling brand identity and and assortment. So, I don't know.

1:19:19

I think lifestyle is probably the more the more natural um Yeah, it's an interesting dynamic where it's easier to break out and establish a foothold as a brand by really focusing on like a subculture like running, but then can you Is Is running You know, what are you running from? Right?

1:19:36

Is it Is it Is it somewhat of a Is it an Instagram kind of, you know, fad? Right?

1:19:42

Are people Can Can running support 10 different, you know, micro brands over time? Probably.

1:19:51

But at the same time, like, it feels like very like on trend right now to uh and and yeah, we'll see >> [clears throat] >> Yeah.

1:20:00

We'll see how how durable it is.

1:20:02

>> So, outside of following you, uh what's a good way for folks to get into menswear?

1:20:07

If I'm talking to somebody and they're interested in cars, I might recommend Doug DeMuro, go down that rabbit hole.

1:20:12

Uh there's you know, there's a whole uh you could pick up a copy of Car and Driver, you could start watching Drive to Survive, just watch F1, you'll learn about cars broadly.

1:20:20

Uh what are the different entry points?

1:20:24

What are the great uh you know, either creators or publications that you think uh help people get up to speed on menswear.

1:20:32

Yeah, that's uh That That's kind of why I started tweeting, honestly. Um it's it's hard.

1:20:37

I I don't know that there is that there is one and and I think the the the offering in terms of voices and and publications and and more of like the institutional side of it, there uh I don't know.

1:20:52

I feel like kind of aimed a little high.

1:20:55

Like they're they're looking at temporary brands, they're looking at runway, they're looking at things that may may not be super useful to most people and and so I found out a really hard time trying to find relatable, digestible content or or advice. Sure. Sure.

1:21:14

Yeah, for for normal people. >> Who you got?

1:21:16

>> Jeremy Kirkland, Blamo. Okay. >> He's a buddy. Cool.

1:21:19

>> But uh I He's had a He's had a great podcast forever that kind of goes through and interviews a lot of the great kind of founders and creative leaders in the industry. >> he's cool.

1:21:29

There's um >> [clears throat] >> Who's that dude?

1:21:31

Uh Now I'm blanking on his name. I don't know.

1:21:37

Um Last question, do you think uh do you think surf brands can ever make a comeback?

1:21:42

Do you think that any people will be like, "I got to get the new Billabong drop.

1:21:45

I got to get the new Quiksilver." Is there a chance?

1:21:48

They've They've fallen off so incredibly hard that I feel like >> [laughter] >> Yeah, the The fall off is just insane.

1:21:56

I like people just like young teenagers, they want to wear Chrome Hearts and and you know and and streetwear they The last they don't want to be caught dead in Billabong, but everything all these things come back around eventually. >> Yeah. It's kind of funny.

1:22:14

I was just talking to uh a buddy in the industry about this, how Billabong, [clears throat] Quiksilver, whatever, kind of you know, they they were tapped into culture.

1:22:24

They were kind of running things um for a little bit, but now that I mean that vibe is probably running brands or or golf brands maybe a little bit.

1:22:32

Um, there is the one brand Florence Marine X which John John Florence is the face of Yeah.

1:22:39

which is backed by the Hurley family and he's having a go at this sort of like modern uh, take on on a surf brand.

1:22:50

You have Outerknown as well.

1:22:52

Kelly Slater's Outerknown brand that he co-founded.

1:22:56

It's definitely more of like a lifestyle brand.

1:22:58

>> Yeah, the the the question though is can any of these brands like break back into culture?

1:23:04

>> or Quiksilver break back specifically?

1:23:07

No, no, I'm just saying like even Outerknown and and Florence Marine X like you don't see like Instagram kids in a GT3RS, you know, rocking like out you know, Outerknown.

1:23:18

And my question is like could you ever see one of those people one of those archetypes, you know, rocking uh, a surf brand?

1:23:25

It seems it seems like a stretch, but It's it's hard Yeah, it's it's hard to imagine, but I don't know.

1:23:29

I mean crazy things happen.

1:23:32

>> Billabong's got to sign Yeah.

1:23:32

uh, ASAP Rocky as creative director.

1:23:38

>> Most of the GT3RS owners seem like the type to put the surfboard on the roof which is like ridiculous.

1:23:42

Obviously no one would ever do that.

1:23:45

Uh, but uh, >> [laughter] >> I mean I I this is something I don't know.

1:23:50

Anyway, thank you so much for doing >> to meet you.

1:23:52

Thank you for thank you for all of your commentary.

1:23:55

And we'll chat with you soon. Have a good one.

1:23:58

We'll find a Porsche store somewhere. We will. You're the man.

1:24:02

Let me tell you about Turbo Puffer.

1:24:03

Serverless factor in full text search built from first principles in object storage.

1:24:06

Fast, 10x cheaper, and extremely scalable.

1:24:10

Uh, before we bring in our Oh, is our next guest available? >> Yep. Fantastic.

1:24:12

Let's bring in from Arc Boats.

1:24:15

That's the sound of the boat going.

1:24:16

You need to play that constant.

1:24:20

And let's bring in Mitch from Arc Boats. How you doing, Mitch? >> on, Mitch? I'm doing well. Thanks for having me. Thanks for hopping on.

1:24:26

I'm I'm I'm super familiar with you I think we talked on the phone a couple years ago, but since folks out there might not be, please introduce yourself and the company.

1:24:38

Yeah, my name is Mitch Lee, co-founder CEO of Arc.

1:24:40

Arc is on a mission to electrify the marine industry, rebuild this very outdated uh industry around more modern electric powertrains. Yeah.

1:24:51

It's similar to what happened in rail many decades ago.

1:24:53

Every train today is electrically powered.

1:24:56

They're diesel electric, hydrogen electric, battery electric, but they're all electric. Yeah.

1:25:03

We're Marine industry is going to do the same thing and we're out to a big lead there.

1:25:08

Yeah, we were talking to Travis Kalanick about how he I think he got like a tour of SurRonics factory and was like, "I want to water ski behind that."

1:25:14

But I think you can technically >> addicted to water skiing.

1:25:17

He wants to He wants to drive him to help him water ski cuz he's like, "I can't get anybody to drive the boat."

1:25:23

>> Yeah, so so talk to us about what can you do on an Arc Boat?

1:25:26

Fish and wakeboard and water ski is everything on the table?

1:25:31

And then and then what Yeah, is there an autonomous vision in the future?

1:25:36

Yeah, so briefly on the business where we started was we we had this core thesis, the entire industry is going to go electric over the next decade or so.

1:25:45

We started by hardening that technology in the consumer space.

1:25:47

So our first boats to market were consumer boats and speedboat that you could water ski behind.

1:25:54

Now we're ramping production of a wake sport boat.

1:25:55

So something that you wake board behind. >> John's a lake guy.

1:25:59

I'm more of a I'm more of an ocean guy, but John This is it's lake boats, lake boats.

1:26:05

That's my That's what I grew up with. I love it.

1:26:09

Uh so we're ramping production of that.

1:26:11

We're making a deep boat wake.

1:26:13

>> Is there anything you can do on the electric side to make like the biggest wake ever or is it more just kind of like hey we want kind of something that Like like like the plaid was like for the price like the fastest zero to 60 to time.

1:26:26

Is there an equivalent like oh electric unlocks this?

1:26:29

Because obviously everyone knows about the environmental benefits, the cost benefits like but the maintenance but like is there going to be like a killer feature from electrification? There is.

1:26:39

I mean there are multiple killer features.

1:26:41

One of the biggest ones is actually sound. Okay.

1:26:42

The it is quiet when you're on the boat and like operation Oh so you can just talk. That's that's amazing. >> That's amazing.

1:26:51

>> Uh you don't smell the fumes of it.

1:26:51

Um the torque on it so >> a that's a downside that's a downside for John.

1:26:56

He loves the smell of you know fumes in the morning.

1:27:01

Yeah seeing the oil pool of in in as I jump [laughter] into the water that's my exhausting down into the water and cancer that you're yeah that's great.

1:27:10

Um No but the the torque at low speeds is very high so you can when you punch the throttle that it's it's immediate acceleration.

1:27:16

The way you corner it handles like a jet boat.

1:27:18

So you can whip this it's electronic steering electronic electronic throttle.

1:27:24

So you can whip this boat around with a like you know steering with one finger and throw people off the boat because it's so powerful. Right.

1:27:31

And then it's software defined so every part of this is yeah they powered by software.

1:27:36

You've got in-house firmware, in-house software, in-house telemetry system, over-the-air updates.

1:27:43

You hit one button the wake is perfectly configured for whether you're wakeboarding or wakesurfing on the left or right side of the boat.

1:27:50

We can set that all up in software and it it's just a punch of a button. That's amazing.

1:27:54

So talk talk to us about where you're going next, how much money you've raised, what the plan is going forward cuz obviously you you you found this beachhead metaphorically and you're expanding. Yeah.

1:28:06

We we just closed a $50 million series C that brings our total amount of funding Love the energy of this Play the boat sound.

1:28:18

I want to hear the boat sound again.

1:28:22

>> [music] >> Guess we fired up in the morning. I love it.

1:28:27

[laughter] That should be your alarm clock the So 50 million That's my anytime somebody calls me, that's the sound that it makes. That's great.

1:28:35

>> [clears throat] >> We we just closed that >> [laughter and gasps] >> Sorry, it's Friday. We're having fun.

1:28:44

It's hard to keep it together.

1:28:45

>> Don't worry, I'm hyped up on Celsius. We're good to go. Good. Good.

1:28:49

We So we just closed that round.

1:28:49

It brings our total funding up to 160 million and the again, we hardened this technology on the consumer side.

1:28:57

We're now we're at at a call it a 40 million dollar run rate on deliveries of those boats every month.

1:29:03

It's going up every month. Our margin is expanding. Yeah.

1:29:07

We are now expanding that like core technology, the platform that we built to commercial applications and defense applications.

1:29:14

We signed a 160 million dollar deal for ship assist tugboats.

1:29:19

So giant tugboats out on the water that push and pull cargo ships. >> Oh, wow.

1:29:24

So that So that that rapid acceleration and and that like turning capability that you mentioned I imagine is is huge for if you're like makes it tugboat potentially a lot more like accurate. Or is that the case?

1:29:38

You definitely get a lot of torque benefits from it, but a big part of it is they care about profit.

1:29:41

They care about like tugboat operators want to make more money.

1:29:45

And the way that you make more money is you cut your op ex in half by reducing the fuel cost, by reducing the maintenance costs, by keeping that vessel, which is a 20 million dollar vessel, online and running more like a greater percent of the time.

1:30:00

And then you also avoid a bunch of compliance burdens.

1:30:02

These things are cancer spewing machines.

1:30:04

So by going electric, you avoid a lot of the compliance burdens for like, "Hey, how do you EPA more cleanly burn bunker fuel?"

1:30:13

Instead, it's like, "This thing doesn't even have fuel tanks on board."

1:30:17

You can put a diesel generator on the back of it, but it's a it's a much cleaner What about What about autonomy?

1:30:23

The In the commercial space, that's not as big of a deal today.

1:30:28

On the consumer side, I mean, we we have a fair amount of autonomy.

1:30:30

You can hit a button and the boat will just hold its position in the water.

1:30:33

Um we'll Oh, without without an anchor, you're saying? Yeah.

1:30:38

Yeah, anchorless anchoring. >> That's really cool.

1:30:40

So, if you're out in Lake Tahoe, it's pretty deep there.

1:30:43

You can't drop an anchor, but you can just hit a button and say, "I'm going to jump into the water because my boat's staying still." >> just stays there. That's amazing. >> That's really cool.

1:30:51

[clears throat] >> Um I mean, we, as kind of a little side project on a on a weekend, took the boat out and made it remote controllable.

1:30:57

So, you could just kind of remote control a and Yeah. $300,000 Arc Sport.

1:31:01

So, if you want to I mean, I don't think this is legal in maybe any state but Texas, but you can like hop out >> lives.

1:31:11

>> [laughter] >> You got to give him a call. Yeah.

1:31:15

You get You get one of our boats and just remote control it >> What about the What about the elephant in the room? Jet Skis.

1:31:21

When are we going to see Jet Skis? Mhm.

1:31:24

Where Where are we going with this?

1:31:26

>> [laughter] >> I I don't Jet Skis are a tough problem.

1:31:31

It's It's like It's kind of like motorcycles.

1:31:32

There's a reason that they haven't gone Mhm. mainstream electric yet.

1:31:37

I think we might see that one day, but the cost I mean, they're low margin vehicles, and so getting the cost down to be competitive is tough.

1:31:44

What about >> you saying?

1:31:46

So, it's hard and low margins.

1:31:47

You don't care about me having fun. Love of the game.

1:31:52

What about the charging infrastructure at at at different marinas?

1:31:57

>> [laughter] >> You want a Jet Ski really badly?

1:31:58

I I the the SAS Well, you just want this cuz it will it will tow you in to the big waves, right?

1:32:05

I just jet skiing is euphoric. >> Yeah.

1:32:07

If you're in Nazare, you need an electric jet ski. It's autonomous.

1:32:09

It'll tow you into the 80-ft waves.

1:32:12

>> you know, it's hard with a jet ski.

1:32:14

You're thinking about, you know, your the the the dolphins are not having a good time.

1:32:18

>> Well, they don't like them.

1:32:18

You need to do it for the dolphins. >> Okay. Okay.

1:32:21

For the love of the game. For the dolphins.

1:32:22

That's that's our that's our motto at our for the dolphins. He's a huge dolphin fan.

1:32:25

Uh d- talk to me about the charging infrastructure at marinas.

1:32:29

Is is this something that you partner with docks to get up to speed?

1:32:33

Is there infrastructure that's pretty easy to just plug into?

1:32:38

How how how is that been?

1:32:39

The way I describe this is electric boats make way more sense than electric cars.

1:32:43

That's not to say electric cars don't make sense.

1:32:44

They just have hard problems to solve.

1:32:46

You have to solve for road trips.

1:32:47

Gas cars are really good at what they do.

1:32:49

Like going electric on the water is a no-brainer. Sure.

1:32:53

Charging infrastructure is a good example of this.

1:32:56

Marinas are already wired for power because big boats use shore power to power uh refrigerators or um The entire boat.

1:33:06

The entire boat cuz you're going to have batteries for a long time.

1:33:08

So, you need a lot of charging infrastructure.

1:33:09

So, And and if you have a dock, then your dock is usually wired for power for lighting or if you have a boat lift, that boat lift already runs 240. >> That makes sense.

1:33:18

It It charging is a pretty tractable problem.

1:33:20

It's not perfectly solved, but it's we've we're off to a huge head start there.

1:33:26

When you get into commercial and defense applications, we just design the vessels so that they don't need charging.

1:33:29

We're installing charging, but you don't need it.

1:33:33

Uh so, everything is hybrid electric.

1:33:35

It's diesel electric or hydrogen electric or nuclear electric. >> Mhm.

1:33:40

Like aircraft carriers today are nuclear electric, for example. Mhm. >> Yeah. Yeah.

1:33:45

>> [clears throat] >> They have an electric propulsion system, but then where the power source is coming from is is nuclear energy. Interesting. Yeah, it's fascinating.

1:33:52

Well, >> [snorts] >> thank you so much for taking the time to come chat with us. Congrats on the round.

1:33:55

And uh see you out there.

1:33:57

>> We got >> get out on the water. >> to do it.

1:33:58

Uh There's nothing like a Princess boat. Come demo it. Sign up for a demo. I mean It'd be awesome.

1:34:05

>> To anyone that's watching this, too, come out for a demo.

1:34:06

It's It's a It will shift your perspective on the industry. Amazing.

1:34:11

Uh have a good rest of your day.

1:34:11

Enjoy the weekend, and we'll talk to you soon. >> Cheers.

1:34:15

Our next guest is here in person.

1:34:15

We have Bucky Moore from Lightspeed.

1:34:17

Let me first tell you about Shopify.

1:34:19

Shopify is the commerce platform that grows with your business, [music] lets you sell in seconds online, in store, on mobile, on social, on marketplaces, and now with AI agents.

1:34:27

And without further ado, Bucky Moore. How you doing?

1:34:30

>> [screaming] >> Great to be in the temple today, guys.

1:34:31

First time in person, and Yeah, I think the It's an time we did this, I think we were both kind of just getting started on our journeys, right?

1:34:37

It was early last year, and so you guys have just ascended.

1:34:40

More sponsors, bigger studio.

1:34:43

Dude, you're a Better hair, right?

1:34:43

I didn't know you I didn't know you were jacked. Yeah, yeah.

1:34:47

It's It's a It's a great day today.

1:34:49

We had We had leg day today. Beautiful day in in LA. >> What's the split? What's the split? That's the split. That's the split. Monday, Friday. Monday, Friday. Yeah, yeah. We got you. All right.

1:34:59

We We may be able to adopt that >> [laughter] >> 52 leg days a year.

1:35:06

But we do like we've been doing a a technology brother split, which is a more traditional Upper body.

1:35:13

>> [laughter] >> So it's like, you know, leg day would be Wednesday, but then you don't get the second leg day until Saturday. Recovery though.

1:35:22

Uh >> [laughter] >> how has How has Lightspeed been? It has been fantastic.

1:35:24

I mean, I think we're all just lucky to be in the center of the industry right now, given all the amazing stuff that's happening.

1:35:29

I think since we last spoke, we uh we closed 9 billion in new funds, and we have been uh Go go hit the gong for us. Smash that thing. Congratulations.

1:35:43

Uh so 9 billion funding, and and that's across venture and growth? That is correct.

1:35:47

Yes, so Lightspeed is a is a generalist firm, and I I something that's that's very unique about us is we have produced like really meaningful returns in just about every sector from healthcare and life sciences to enterprise to consumer to hard tech >> [laughter] >> and financial services.

1:35:59

It actually is though and I think it took me a while to realize that it's it's the secret I think of of the platform is that we were willing to take deep deep technical risk and very high conviction bets early and uh that's uh I think that's the secret. Yeah.

1:36:13

So, what have you been focused on?

1:36:14

More on the venture side? Absolutely.

1:36:16

So, I've spent all my time kind of in and around AI on the early stage side.

1:36:20

Um obviously we've been spending a lot of time kind of looking for these like really really transformative opportunities in the infrastructure layer.

1:36:26

So, new inference platforms, new model providers, and then in the application layer, I mean, I just feel like I'm seeing the future every day.

1:36:33

There are companies that are just bringing this intelligence to bear in unique ways with these industries that I think is uh is really going to be the tip of the spear in how the world adopts this technology.

1:36:41

So, when we talk about the SaaS apocalypse, uh I think a lot of that is is is somewhat overblown in this like I would agree with what Pat and Carl said yesterday in the sense that people do business with people and ultimately I think it is so much harder than a lot of these blog posts make it out to be to actually get this technology into these industries into these end users' hands in a way that actually makes it actionable.

1:37:02

And so, we've been very actively investing in both layers and I I think there are places where the model providers are going to do a good job of that, but they are still going to have to shoulder the responsibility of that last mile.

1:37:10

And then I think there's going to be places where app providers are are going to be really prolific and and build very valuable companies. Yeah.

1:37:16

Let's let's work through the supply chain a little bit of the or the stack as AI means so many things right now.

1:37:22

Uh starting with like it feels like the the ship has sailed a little bit on like training new models for the most part the big labs are really big now, huge, maybe going IPO this year. Uh neo labs are popular. What?

1:37:34

I mean, there's so there's so there's enough There are a lot of neo >> a new neo lab at least >> Is that interesting to you?

1:37:43

So, I would say as a firm we have we have been very active in investing in a lot of these neo labs.

1:37:47

So we're an investor in Mistral, SSI, Thinking Machines. >> Okay.

1:37:51

Uh I do I would also concede that I think the bar to reach the frontier today is is higher than it's ever been. >> Yeah.

1:37:57

And so I think for us it's really just a a question of whether >> seen like you can have unlimited effectively unlimited resources and not meet the get to the frontier.

1:38:04

And so as an investor there really you have to see that the team actually has like some like capital is not enough.

1:38:14

>> I think I think there's an argument to be made that there are just no secrets in this industry anymore and scale is all you have.

1:38:18

And I think there are, you know, really three, maybe four labs that are that are able to to really play that game.

1:38:23

I'm more I'm more asking like yeah, you've made bets on neo labs.

1:38:27

Those make sense, great teams.

1:38:27

Are you expecting to make a whole bunch more neo lab bets that are like truly we're not on top of any open source model.

1:38:34

We're going to do the full thing in 2026, 2027 or has that ship sailed more or less?

1:38:41

Yeah, I want to I want to be careful with what I say here.

1:38:42

Obviously to to to uh remind myself that this is all about exceptions, but I think what we're seeing is the bar is way, way higher, right?

1:38:49

And so everyone talking about sample efficiency, everyone talking about continual learning.

1:38:53

I mean, these are things that the large labs are very, very focused on as well. >> Yep.

1:38:56

But I also think that there's a pretty valid argument to be made that the bureaucracy of these large labs is real.

1:39:01

Like in the same way that OpenAI was able to exploit Google's bureaucracy by scaling a transformer before they could.

1:39:06

I think you can argue that such opportunities will exist in the future for, you know, for OpenAI and Anthropic being distracted by making the products that earn them all this money. >> Sure. Sure, sure. Yeah, that makes sense.

1:39:15

What about like much deeper in the supply chain?

1:39:17

We there was this article in The Information a few days ago about a company called Giga that has raised no venture funding.

1:39:23

It's a it is a small team that got into like building electrical infrastructure and it's it's in the AI narrative.

1:39:30

They were initially selling, you know, transformer equipment, like physical transformers, not the transformer architecture, to Bitcoin miners.

1:39:38

Then they pivoted into the AI data center boom.

1:39:39

They are seeing a lot of success.

1:39:41

Would you ever dip down that deep or is that sort of out of your purview?

1:39:46

Obviously exceptions to everything, but >> I mean, I think my a few of my partners have been spending a lot of time on just the power problem.

1:39:53

And I think from my perspective as someone who tends to invest more in the in the software layer, what I'm seeing is that a lot of these neo clouds are actually blocked by their ability to raise the credit they need to actually bring this power online by the quality of the counterparties.

1:40:07

So, if your counterparty is Open AI for example, the debt providers are going to be very very aggressive and open to to to flowing you the the funds that you need to to bring all this online.

1:40:14

But, on the other hand, these neo labs who aren't generating revenue, may not have a near-term path to revenue, they're looked at very differently as counterparties.

1:40:21

And so, that's a I think a big blocker for for these neo clouds to bring a lot of the capacity that they have online.

1:40:26

And so, how do you how do you unblock that?

1:40:27

Obviously, we need new and more efficient means to generate electricity.

1:40:31

And so, we've been very actively investing in nuclear.

1:40:34

We were investors in a company called Base Power that's doing some very interesting work, right? Go Zach.

1:40:37

And I think we will continue to be very active in that area.

1:40:41

And my my partners on the hard tech side are very busy trying to figure that out.

1:40:44

Then, on the other side of the stack, the application layer, what advice do you give to founders?

1:40:51

What are the green flags for, okay, you're building in the you're building in the application layer, you're never going to compete in training a foundation model.

1:41:00

Maybe you do some fine-tuning, but there's other secrets in the business.

1:41:04

There's other sources of modes and strengths that you will see compounding and you don't think you're going to get steamrolled by an Open AI or an Anthropic anytime soon.

1:41:11

Yeah, what's what's interesting Right in this moment, I mean, this week it's been top of mind in the last couple weeks is like I expect that the dynamic we're seeing right now between Cursor and the labs is what we'll see for pretty much every other vertical, right?

1:41:24

I expect to see that in legal.

1:41:26

Like, you know, Claude has come out with like plugins for legal, but you can imagine them just saying like, "Yeah, we now have 100 people working on just the legal application of our technology.

1:41:36

And so I think that every across that doesn't mean, you know, doesn't mean these companies can't still do well, but it I I'm I'm I'm trying to think through like the timing where where Open AI and Anthropic just like just like basically go all in on on some of these bigger categories.

1:41:53

Yeah, so I'm glad you brought up Cursor and like the software engineering space cuz it's obviously the most mature.

1:41:59

So I think it's very illustrative as is legal.

1:42:00

And interestingly today you guys I'm not I'm not sure if you guys covered this in the beginning of the show, but like the the model that Cursor launched, right?

1:42:05

So So first off you know, it's very obvious now that these companies are going to be training their own models.

1:42:11

And it's it's it's also the case that they're going to be starting with one of these open weight models which today are Chinese which as an American citizen doesn't sit super well with me.

1:42:19

We are investors in a company called Reflection AI that aims to change that.

1:42:22

Um but on the other hand I do think what Cursor is out to prove is that the user data that they're capturing is going to allow them to set up this reinforcement learning loop that does allow them to to build something that is like frontier quality.

1:42:34

At the same time it appears as though these companies are still sending a lot of their most complex queries to Codex to or rather GPT into into Claude.

1:42:43

And there's obviously a margin problem there that that is pretty hard to compete with when you think about the competitive products that Open AI and and Anthropic have.

1:42:50

And then when you shift gears to legal my assumption would be that like Harvey and Lagore will have to do the same thing that Cursor is doing.

1:42:55

And so I think this is kind of an elephant in the room right now as to whether whether post training open models allows you to combine with like unique user feedback that you get from being an application provider is is is defensible enough.

1:43:07

And so when I when I think about like the companies that we're looking to invest in I would actually say that I think that is just going to be an inevitable challenge for any of these industries that hit a maturation point of AI adoption like legal and software engineering have.

1:43:18

But on the other hand I think there's some industries where they're they're very large.

1:43:22

They're far enough afield from where the model providers are today and probably will continue to be and the context engineering to actually get the customer data into the model is just so messy.

1:43:31

It requires going across different business functions.

1:43:33

It requires a lot of like hands-on forward deployed engineering.

1:43:36

I think those are the kind of companies that we get really excited about because I think just being really good at that is not only defensible, but it also allows you to start to generate this like feedback loop with your customers where you hear a lot of their secrets.

1:43:48

And those secrets allow you to feed that back into how you make your product better at the expense of anyone else playing in the space because if you're serving the customer, they're only telling you those secrets, right?

1:43:57

And I think Palantir is like a good example of this in sort of the pre-AI era and I I think we're going to see many companies ascend in in in that same way.

1:44:03

And so the companies that we're investing in in the application layer, I think have a really clear story around how that is hard and defensible enough that they can make it a core competency.

1:44:12

Let me throw at you that that sort of riffs off of that and and you can tell me if it seems like a fit like Amazon, obviously the goal is to be the everything store, but there were certain categories, regulated medical products, Hims, Roman, those companies were able to break through because it was out of the core competency.

1:44:29

Is that a reasonable thought where it's not just about the flywheel of what's happening with those customer secrets, but it's also just such a sticky messy problem that the big one-size-fits-all solutions can't necessarily attack them?

1:44:43

I think there's sort of a B2C version of this analogy and then there's like the B2B one.

1:44:48

So the B2C one is where you started.

1:44:51

What you've seen with Amazon is they've obviously like kind of done what Costco does, which is when they see a category that's sort of commodity enough, they can create a generic version of it and they can have sort of margin uh you know, advantages there that that allow them to make a lot more money and compete.

1:45:02

But I think that the B2B analogy is the one that I think of a little bit more, which is to say like if you look at Amazon Web Services, they've let companies like Snowflake and Databricks build really, really large businesses on top of them because it's driving consumption their underlying infrastructure. Oh, interesting. That's a good one.

1:45:17

>> And while AWS still has data warehouse and and data infrastructure products, they're you know, they're probably 80% as good.

1:45:23

So if you're if you're in the business of just kind of simplicity and you just want to kind of buy everything from Costco or buy everything from Amazon Web Services in this case, like you're going to go that way and many large enterprises do. Yep.

1:45:31

But on the other hand, Databricks and Snowflake have built really, really healthy businesses and and the health of those businesses accrues to the the success of of Amazon Web Services.

1:45:39

I think you're going to see something very similar with the model providers, which is they're perfectly happy letting, you know, 75% of the large industries out there just kind of sit on top of them and then I think the 25% of those industries that they're going to play in, those are the ones that I think you want to you know, be very mindful of and and avoid. >> Yeah.

1:45:55

And and I think what what the sort of hysteria around the SaaS apocalypse is right now is that we're starting to see the aperture of that 25% like rear its head. Yep.

1:46:01

And I think what that what that means is you you you naturally take a step back and say, "Wait, like it's not just going to be software legal." Yeah.

1:46:07

And so I think that's the conversation that we're having every day is like what's next.

1:46:10

And I think Claude co-work is is sort of an example of where you could also just imagine that there's sort of this new class of of of uh AI app company that essentially connects to something like Claude co-work via MCP and actually is in a really interesting position.

1:46:22

So like we're seeing we're seeing companies emerge where, for example, um in the coding paradigm, there may be places where you want to jump out of the code and jump to a design canvas, for example, right?

1:46:32

And so there's a company, for example, that's trying to just be called Paper that we think is really interesting that is uh trying to provide a canvas that literally is just allows you to go from like the code you generate in Claude Sure.

1:46:40

to the canvas and back, right?

1:46:42

And today, that's something that Figma hasn't focused on as much, but I'm sure will.

1:46:45

Uh Granola, which is a company in our portfolio, like they they've launched an MCP server and people are using it very aggressively in Claude. >> Sure.

1:46:52

And I think what you're going to start to see happening is that the monetization model of a lot of software companies is going to shift actually monitoring or sorry, metering the the rate at which the MCP server is consumed.

1:47:01

So, for example, every time I call Granola's MCP, Granola should make a little bit of money right?

1:47:04

And I think that's actually going to be a very healthy business model and one that's probably durable going forward. Jordi, sorry. Cut you off.

1:47:11

Cut you off. Uh how do you think about opportunities at the super early stage where you where a lab could do it, but wouldn't because it's only in the near term like a $300 $500 billion revenue opportunity because I think there's like lots of you know you look at companies like open evidence or Suno that have built like you know pretty big businesses and like I think

1:47:36

like Suno seems to be a beneficiary of like the battle between Anthropic and Open AI right now specifically because Open AI is like well we could put a bunch of resources into a you know uh a music product but like that's not the most important like if we just even if we knock it out of the park it's not going to like necessarily change the dynamic at the frontier. Are you

1:47:56

Are you thinking about are are you seeing opportunities at the early stage where you're like yes the labs could do this they would be in a good position to win but it's just not even a big enough opportunity and so a small focused team can like get to a 5 10 billion dollar valuation and then have the opportunity to like you know scale from there.

1:48:13

Yeah so I'll start with Suno so we're also one of the largest investors in Suno love Mikey.

1:48:18

I was honestly very for me to conceive that music could be generated by AI that I'd actually want to listen to and I've been proven wrong and really changed my mind on the company.

1:48:30

So I think the sky's the limit for them and like what's interesting about Suno and more broadly audio models is they're just not as big as language models meaning like you don't need as much compute to build really good audio models and so I think the scale advantage that the labs have is is is just a little bit less of a thing in that area. >> point.

1:48:47

That's right that's right but but I think coming back to this like hey there's going to be 75% of the industries that they sort of rule out is like just immaterial given how big they get and obviously they're growing so non-linearly that like what's material for them changes by the week and so I think there is going to be a

1:49:00

pocket of really really venture scale industries that the labs just do not service adequately and I think that's what we spend every day thinking about is like what are those spaces and how do we find the best teams working on them and so so I think that's that's again why I sort of take the other side of this like you know B2B app business is is sort of over. >> What's uh what's an overlooked category

1:49:19

>> What's uh what's an overlooked category right now?

1:49:26

I mean, I wouldn't say it's underrated, but I think like power is still overlooked.

1:49:29

It's just so important and such a bottleneck that it just >> and such a bottleneck and and the fact that you can name some nuclear companies, you can name, you know, we've had base power on a bunch of times, but you know, you would think there would be a bunch of like base power style opportunities.

1:49:47

>> I think we're probably rate limited by capital going into that industry right now.

1:49:50

That's just my intuition.

1:49:50

Uh the other area that I think is like more core to where I spend my time that I still think is underrated is inference, right?

1:49:56

So like the GPU supply crunch that we're seeing right now is is largely in part as Dylan has said on the show before like due to the fact that not only these consumer products, but the B2B products like uh like Claude Code and Code X are just really taking off and and creating like insane demand for inference.

1:50:09

I actually think that in the end inference, if you look at it as a market, will be much much bigger than cloud computing was pre-ChatGPT.

1:50:15

And if you think about like I mean, we're talking like hundreds and hundreds of billions of of of spend every year.

1:50:19

And if that's true, like I think there will be very very large inference platforms built in each modality.

1:50:25

So there will be an inference platform for real-time video models.

1:50:28

There will be an inference platform for uh you know, open-source and custom language models.

1:50:32

There will be a uh an inference platform built specifically for long-running agents.

1:50:35

So I think we're just going to see that industry, which today looks like one industry, break up into many because of how big it is and how much room for specialization.

1:50:43

>> I mean, we there there was some some leaks around like fall this week, [clears throat] right?

1:50:47

[clears throat] right? Who's just been on, you know, an insane trajectory and like kind of, you know, they've they've done a bunch of rounds back-to-back, but going that quickly from a zero to a $8 billion valuation while staying like

1:51:00

relatively out of the like 10 years ago there would have been like a bunch of beat reporters just for covering, you know, just covering fall and they've like are like kind of just like happily being like, "Yeah, we're just building a huge business over here." >> can sort of imagine like inference

1:51:12

>> can sort of imagine like inference specialization, if that's the thesis that plays out, happens both on like the model level, the data level, the taste level, the harness, but also down to the hardware.

1:51:24

Like there's certain configuration, certain chips.

1:51:25

I mean, we see this through inference acts from semi-analysis.

1:51:29

Like AMD chips will outperform Nvidia chips with certain models.

1:51:33

So, if you're in some some particular inference vertical, you might have a very different semiconductor supply chain.

1:51:39

Yeah, and I think one one interesting thread to pull on there is if you start to relax the latency constraint when it comes to inference.

1:51:45

So, for example, like if I'm just telling my software agent to go do work and come back to me in a couple days when it's done, I probably don't care as much about latency.

1:51:51

You care about throughput.

1:51:51

And if that's true, then you start to look at these chips that Intel and AMD have and they look really, really good.

1:51:56

They're cheaper and and and really stand up.

1:51:58

And you can imagine that for like like if there's if there's if I'm doing like blood work or something and I have to physically mail blood and there's like no AI that can short circuit that.

1:52:07

So, I'm going to be waiting a day or two to get the data back.

1:52:10

And the and the model that processes the data or sequences it or something takes an hour instead of a minute, like that's not going to be mission critical to actually process the data.

1:52:20

Whereas if I'm doing a Google search or I'm on my computer like actively doing work, throwing that on Cerebras or something or Grok is going to speed things up and specifically in the developer workflow, too.

1:52:32

>> Yeah, I think where this starts to get really interesting is like if you ask yourself like will there be more of those types of workloads or less?

1:52:35

Like I think it's quite obviously more for moving to these long horizon sort of more autonomous agents.

1:52:41

And so, I think there's a world in which the sort of latency constraint that drives a lot of the hardware purchase and design decisions today starts to be relaxed and we see a a much more heterogeneous Yeah. ecosystem. >> Makes sense.

1:52:53

Uh fundraising timelines today? Faster than ever?

1:52:57

For venture or for startups? Early stage. No, no, no.

1:52:59

Yeah, yeah, I'm talking about startups.

1:53:01

Like if you if you back a company at seed, how long how long, you know, what what are the >> companies in the current YC batch that are raising over at over a hundred million valuation, which is crazy cuz demo day is next week.

1:53:12

And so, how do we even know that this is happening?

1:53:15

Usually you wait until after demo day.

1:53:17

Not if you have the kind of momentum.

1:53:19

>> the average the average price is around 40, and clearly deals are getting done very very quickly.

1:53:24

>> Yeah, I I And then like any any you know, is is the the global conflict uh that we've entered into, is that is that slowing things down at all yet?

1:53:32

Is there any kind of like um pull back that you're seeing?

1:53:39

So, I'm not seeing the geopolitical impact early stage fundraising in any way, but coming back to kind of the velocity question, look, I think right now we So, first of all, what I've learned is that you don't really get to decide how much of the best companies you get to own, and you don't really get to decide the valuation.

1:53:54

They decide it, and you have to decide whether you want to be involved with them or not, right?

1:53:58

And right now, I think early stage is in this tricky place where like for a seed round, like you're really generally getting around 10% right?

1:54:04

For the most competitive rounds.

1:54:07

And as a result, if you go back to kind of like what made the early stage model work, it was like owning somewhere between like 15 and 20% of companies that that become really really valuable.

1:54:15

So, the way you kind of have to play this now as a multi-stage firm is you get the 10% in the seed, and then you effectively have to be in a position to buy up in the next round, the series A.

1:54:23

But at the same time, the series A's are are are also ballooning in price, and there's really not a lot of de-risking because the valuation or because the the velocity is so fast, right?

1:54:32

By comparison to even like a couple years ago.

1:54:33

So, right now what you see a lot is like you get 10% in the seed, the series A happens somewhere between like, you know, 150 and in some cases like 300 post, and then you end up kind of trying to co-lead that or lead that, and you end up in like the low to mid teens.

1:54:45

And so, it's it's just a different time, but like that's that's what it takes nowadays.

1:54:48

And there are obviously exceptions to that, and I'll gladly buy more than 10% of a company at seed if I'm excited about it, and the founders are open to it.

1:54:53

But that is the reality that we live in, and I think what that means is uh uh you're just you're you're building a basket of companies that tend to be kind of in that low to mid-teens ownership more often than not.

1:55:03

Are ghost ship zombie acquisitions affecting venture economics at all?

1:55:10

Or has it been generally accepted >> software companies that are slow growers and not going to >> No, more like licensing deals.

1:55:16

>> growth startup with a bunch of venture capitalists that then a bigger company comes along and says, "We want to buy you, but we're public and so we can't just acquire the whole company and go through uh FTC approval.

1:55:26

So instead, we're going to hire the whole team, do a licensing deal, pay a dividend to the cap table, but there's always this moment where you're like, "Did everyone get comped what they expected?

1:55:37

Did the employees get what they deserved?

1:55:40

Did the venture investors get what they deserved?

1:55:43

Did the founders get what they deserved?"

1:55:44

And it's sort of this renegotiation moment.

1:55:45

And there was a fear, at least last summer, that like the the Silicon Valley social contract might be violated.

1:55:52

And it felt like at the moment maybe that was uh like a fear that didn't come true because in every case most people seem like they wound up with jobs at cool companies, at big bigger companies, and they did get paid out.

1:56:05

Um but but has that has the fear calmed down or is there still like a low-level ambient fear in venture?

1:56:09

So first of all, I would say that the idea that an acquirer will try to structure deals in a way that disproportionately rewards the founders is nothing new, right?

1:56:19

That's been happening That's a tale as old as time.

1:56:20

And there is sort of this this term used in the industry called the founder bribe, where to get a deal done, the acquirer may in fact try to route as much of the proceeds toward the the founders and the core team as possible.

1:56:30

It's also perfectly rational because like why why would they want to give me any money as the investor, right?

1:56:35

They'd much rather give uh money to the people that are actually doing the real work >> Yeah, your job is done And it also depends on you know, is it an asset sale or a talent acquisition or somewhere in between?

1:56:45

And everything's sort of a uh you know, a blurry line.

1:56:49

Yeah, and so with respect to these like creative structures that you're referring to, right?

1:56:51

Like the Scale AI, the Windsurf, and so on.

1:56:52

Like without commenting on specifics, what I would say is uh this is obviously uh an artifact of trying to get around a lot of the the regulatory environment that makes buying companies difficult for one.

1:57:04

Two, the bankers out there today are just pitching these left and right because they're you know they're out there trying to transact and they think this is a a much more realistic way to transact.

1:57:12

And and three I think I think the jury is still out on whether the acquirer really gets like the the return on these that they're looking for right?

1:57:20

Like a lot of these are still in flight and and I you know I I just don't know.

1:57:23

So so but what I can tell you is that like it's becoming more common.

1:57:26

I told you why it's becoming more common and and the bankers are are very very actively trying to consummate these types of transactions every day.

1:57:35

How introspective should a new founder be as they embark on their entrepreneurial journey?

1:57:42

Yeah, I uh Because there's two sides to it.

1:57:44

Like I totally get the the Travis Kalanick was sitting here telling us that he had just runs through walls.

1:57:49

Everyone was super pumped up about that. I love that attitude.

1:57:53

I think that the chopping wood, putting your head down, incredibly valuable.

1:57:57

At the same time, I love the the founder's fund question, the Peter Thiel question.

1:58:01

What do you believe that very few people agree with you on? That's introspection.

1:58:04

Like you're you're actually just reflecting on like where do I disagree with everyone?

1:58:09

Maybe there's opportunity there.

1:58:11

And both maybe there's a combination, but I'm wondering how you how you deal with it.

1:58:16

Like how much of the time are you just probing founders, market size, progress, revenue versus where do you want to be in a decade?

1:58:25

What are you doing with your life?

1:58:25

Is this actually the right job or do you really just want to get back to working at Google and this is just a way to get a promotion?

1:58:32

So my experience has been it is very hard to be an effective leader without some form of self-awareness which requires introspection, right?

1:58:40

Let's just get that out of the way.

1:58:41

At the same time I think you know this this sort of this position that Mark is taking or the the [ __ ] maxim you know article that has has has been going around the internet is like there is there is absolutely merit to just like moving forward and putting one foot in front of the other and so Avoiding analysis paralysis. >> Exactly.

1:58:59

And so I think it requires a healthy balance of the two, but I I would disagree with Mark that I just I have not found it's possible to be an effective leader without some form of self-awareness, but at the same time in order to inspire people you also have to demonstrate an ability to move forward through difficult moments.

1:59:11

I think that's where the you know, the I'll say it again.

1:59:15

>> and I think I I I think that's that's actually closer to his real belief, but in the context of that conversation with David Sacks, like it it's better to distill the overall thesis, which is that right now most people would benefit from just having a little bit more forward motion.

1:59:32

So let's let's collapse that into some somewhat more of an exaggerated, uh, you know, take that that then can fly and it gets exaggerated in many ways. >> Yeah, exactly.

1:59:40

Uh, what advice, if any, have you given portfolio founders that maybe on the earlier stage side that see seem like they're going to need to raise over a hundred million dollars in the next 12 to 24 months.

1:59:57

Like how how concerned should they be around uh, everything happening in geopolitics right now.

2:00:04

Does the conflict in the Middle East kind of like turn off the tap or or uh, slow down uh, any LP dynamics uh, for some of these mega funds?

2:00:16

>> treasury in oil right now?

2:00:18

>> [laughter] >> Probably Well, probably not.

2:00:20

Uh, look You don't want volatility with the bank balance.

2:00:24

>> you know, what's happening in the Middle East right now is a is a tragedy and it goes without saying that the uh, many of the countries that are most most adversely affected by that have been very very active players as LPs and I think the impact that this could have on uh, on the way they behave in that sense is is like very unclear, but like it seems likely that there will be some impact and so that has a consideration on venture capital.

2:00:45

My my my example was like if somebody's, you know, doing a lot of angel investing and they're working at Google making $3 million a year in a cushy job and then they like lose their job.

2:00:56

Like do they [laughter] keep do they keep like ripping a bunch of checks do they keep ripping a bunch of checks?

2:01:02

>> and he was saying well like the LPs that write checks from like Gulf sovereign funds, they live in New York and they operate in New York and they take meetings in New York, but there's just a matter of like, you know, the that sovereign wealth fund is zero sum and if it's going towards something else it can't go into a venture capital firm and work its way through the And ultimately the you know, the the royals get to decide >> Exactly.

2:01:22

The priorities and there's a whole bunch of other political considerations.

2:01:25

>> and priorities could be shifting right Totally.

2:01:26

So so I do not know what's going to happen.

2:01:28

I think those are the considerations and I think when we advise the companies that we're working with that are in a position where they actually can raise that kind of money. >> Sure.

2:01:38

We have not yet seen the market indicate that that there isn't robust interest for companies that are really scaling rapidly and and have earned the right to go out and and raise money that way.

2:01:50

>> it seems like we're we're we're pretty like some sort of correction where we're like oh yeah, like you can't raise the same round.

2:01:55

It's just you might you might raise 80 instead of 100 and your competitor's in the same boat.

2:02:00

So you're probably going to operate very similarly with just a little more.

2:02:03

Yeah, I would say that I do think the bar for these neo labs to raise that second round of funding is much higher coming back to what we were talking about.

2:02:11

And so I think to to be able to get one of these off the ground it's possible to do so as someone who has been a part of doing really novel research at one of the big labs and and is someone who can probably build a really outstanding research team.

2:02:23

team. On the other hand, I think to raise that second round of funding where you get to go really big and build out that frontier cluster I do think it's going to require some mix of hey, the work we're doing is unlocking new commercial opportunities and the work we're doing is truly truly

2:02:37

novel at the level of the research and I think absent those things um, I've seen is that it's it's a lot harder to pull those second financing rounds together and I think this is kind of a dead zone for these neo labs where if they can't go big with compute, it's really really hard for them to to to be on the frontier. Yeah. Did you have a Yeah.

2:02:51

Did you have a conventional path to venture?

2:02:55

I would say I had a pretty unconventional path.

2:02:56

So, uh I grew up down here.

2:02:59

I started my career in lower middle market private equity.

2:03:01

I moved up to the Bay Area to work at Corp Dev at Cisco and then I think that's when things started to get a little bit more Yeah, proud sponsor, right?

2:03:07

Um, and it turns out that the uh the the founding leader of the Corp Dev team at Cisco was actually one of the co-founders of Lightspeed, Barry Eggers. >> No way.

2:03:15

And uh that team has definitely produced a number of VCs that remain in the industry today and so that's kind of where I I I I sort of got more conventional, but I think where I started was was fairly unconventional.

2:03:26

>> So so so Corp Dev at Cisco, were you working on a lot of M&A deals?

2:03:29

What was the M&A environment like back then?

2:03:33

Yeah, so when I was when I was there in 2011, this was when we were sort of litigating whether there would be cloud computing or on-premise computing and whether cloud computing was something that would be more than like a test and dev environment for the average company. Sure.

2:03:45

Uh that definitely taught me that uh it's very very easy to underestimate the future when you're one of the incumbents and uh you know, the rest is history obviously with respect to cloud.

2:03:54

So at that time we were trying to execute on a strategy that would put Cisco in a position to own the right pieces where they could both serve enterprises building their own clouds and the cloud providers themselves. Got it.

2:04:03

So we were buying storage companies.

2:04:05

We were buying, you know, new next gen networking companies.

2:04:07

In fact, like one of the projects I worked on was uh you know, trying to acquire unsuccessfully that is Martin Casado's company Nicira Networks, um, which, you know, ended up going to VMware and and, you know, really did transform the industry.

2:04:17

So shout out to Martin on that. >> That's crazy.

2:04:19

And and so so yeah, we were working on a lot of deals like that.

2:04:22

We were working on uh venture venture investments as well.

2:04:24

So sometimes a company's maybe or an industry is not fit to enter via M&A, so you would invest in the right companies and sort of learn, right?

2:04:30

Sometimes you would partner.

2:04:31

So yeah, that's the kind of stuff that we were working on.

2:04:33

It was an amazing job, amazing way to get into Silicon Valley and Totally.

2:04:36

it uh it helped me gain deep appreciation for how much impact these infrastructure companies can make across like every industry at a time where everyone was kind of focused on what the next Uber or Snap Yeah. Yeah, yeah, yeah.

2:04:45

It actually shows you like the breadth of the industry because every day you're looking at some company that is not a household name, is not getting a puff piece in, you know, whatever night legacy, you know, journal is out there, but their business is fantastic.

2:05:00

They have an incredible team, and there's a path to just absolutely massive Also being able to like level check with founders that that might be exploring M&A and just being like, well, I've actually bought a bunch of companies and like That's awesome.

2:05:16

>> helping them qualify themselves and stuff like, are you ready for this? Yeah.

2:05:19

And I and I carry that with me to this day, and I wouldn't have that experience had it not been for the time I spent over there.

2:05:23

Well, Bucky, thank you so much for taking the time to come chat with us.

2:05:26

Have a good rest of your show.

2:05:28

Have a good rest of the day.

2:05:28

I wish we could hang around.

2:05:29

But we will talk to you at console. com.

2:05:32

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2:05:53

And without further ado, we have Steve Huffman, the co-founder and CEO of Reddit.

2:05:56

Steve, how are you doing? What's going on? >> great.

2:06:00

Thank you so much for taking the time to come chat with us.

2:06:05

You gave a fantastic speech at my YC batch back in 2018, and I really enjoyed that.

2:06:11

And yeah, it's just great to great to catch up with you.

2:06:14

I would love for you to sort of just set the table for us for how 2026 is going over at Reddit.

2:06:19

What are the biggest initiatives that you're working on?

2:06:23

How are you spending your day?

2:06:25

Just give us get get us up to speed.

2:06:28

Okay, 2026 is going going fast. >> Yeah.

2:06:32

Actually, man, I can it's like I'm looking at the date now it's March 20th it's insane.

2:06:38

So right now we have a I think single-minded focus on making Reddit more successful for new users.

2:06:48

I think that's the part when I when I think about the Reddit machine and the Reddit business that's the part that I think has the most potential or the biggest gap to close. Yeah.

2:06:58

So like taking a step back right Reddit's got content communities for literally everyone and I think we've proven that Reddit can work for anyone.

2:07:09

You know, men, women, young, old, nerds, normies.

2:07:13

And so now our task is can we make it work for literally everyone? Yeah.

2:07:15

Um and uh making Reddit successful for those new users in that first session.

2:07:22

That's the thing that I spend almost all my time thinking about right now.

2:07:26

>> What What what are the qualities Like what is the what is the experience that someone has where when they join Reddit that gets them to stick?

2:07:34

Like what like what kind of journey are you trying to take them on?

2:07:38

Yeah, it's pretty Yeah, the classic like Facebook one was like if they had five friends they'll stick around forever or something like that, right?

2:07:44

Yeah and I'm I'm not even sure that was true for Facebook although it's like a it's like a tale that's told in in in Silicon Valley. Yeah.

2:07:54

But I mean there's probably some truth to it and the the Reddit equivalent of that would be you find five communities on Reddit that you love. Yeah.

2:08:03

But But do you need >> But do you need five because like you know I don't know growing up Yeah, just because for me it was like hip hop heads in high school like if I typed in like R in my browser it would immediately just like you know like populate R/hiphopheads and I would just go there.

2:08:21

I think that's actually the answer.

2:08:21

You need to find one of those things that is uniquely Reddit, uh touches you, and provides that experience that you can't get anywhere else online.

2:08:34

Um and then once you do find that, you know, then we've got you. Then we've got you. Yeah.

2:08:39

So so I remember um the first time people were starting to use the TikTok algorithm, like the feedback was like it's creepily good, basically.

2:08:48

Within like five swipes, you if you if you stopped and paused over a car video or a watch video for just 1 ms longer, your entire feed would be cars or watches or whatever you were into.

2:09:00

And I'm wondering of that that customer journey that you're trying to, uh you know, funnel people towards the right content that they'll love they'll love, is it more of a user interface design problem or UX design problem, or is it

2:09:14

actually just a compute problem, and you want to apply more machine learning, more modern AI tools to to bring that content faster, learn what the users interacting with or or observing, and then and then help them along? I actually think it's both. Mhm. Uh

2:09:27

I actually think it's both. Mhm.

2:09:27

Uh we've seen this over the years.

2:09:31

One of the things we can do most consistently to grow is make the product easier.

2:09:35

So that would be like the UI. Yeah.

2:09:37

You make it a little bit easier, a little bit faster, easier on the eyes, maybe less chaotic or overwhelming, and we just grow.

2:09:46

Because we have people trying out Reddit every day. Mhm.

2:09:48

And it just for some of them it just doesn't work.

2:09:52

Um but also, right, the the the machine learning, the feeds, those early recommendations and insights have almost unlimited upside as well. Mhm.

2:10:03

But I I actually Reddit is probably in that um era of of ML.

2:10:07

Like once you're a core user and you're in your feed, uh if if you express an interest, yeah, we'll go really heavy on it. Yeah.

2:10:15

Almost too heavy sometimes. Yeah.

2:10:17

And it's a problem cuz some I I I I don't know if this is like a normal Reddit user Certainly mine.

2:10:22

Like people send me weird [ __ ] all the time.

2:10:24

And then, you know, if I if I if I view it in Reddit, I'm like, "Oh, okay."

2:10:28

Oh, no, my whole feed is going to be this thing. That's my life.

2:10:32

>> [laughter] >> Yeah, you need to open it in the browser.

2:10:34

>> of finesse required there. Yeah.

2:10:34

Uh what is the shift to mobile been like?

2:10:40

Uh like what is the story that you tell about about making uh Reddit more mobile-focused?

2:10:45

Obviously, there's a huge shift in user behavior across all internet platforms.

2:10:49

But, what was your individual experience?

2:10:53

Well, so if if if you look at Reddit's story like arc, Yeah.

2:10:57

>> the shift to mobile for Reddit was slower. Mhm.

2:11:00

Because Reddit like it has we have so much text. >> Yeah.

2:11:03

And so, that was like a key We were like a keyboard and screen platform for longer than most. >> Yeah.

2:11:11

Uh now, like desktop uh desktop is by far our smallest platform. Mhm.

2:11:16

Um and so, we don't really think about the shift to mobile anymore. Like the shift happened. Yeah.

2:11:22

Uh may- maybe for Reddit it happened despite ourselves in some ways. But, it's happened.

2:11:27

And so, now it's more of the shift to the app. Mhm.

2:11:29

Um I I think our one of our largest platforms, I think our largest single platform is actually probably mobile web. Mhm.

2:11:37

Um and then and then you've got iOS and and Android.

2:11:42

And so, for us, right, we get so much mobile web traffic because um because of the search referrals from like Google. Mhm. Yeah.

2:11:51

>> So, people are if you're just using the internet on your phone, you're probably using Google.

2:11:54

If you're probably using Google, you're probably using Reddit. Yeah.

2:11:57

Um but so, getting uh helping people kind of cross that chasm between mobile web into the app and doing so in a way that feels good, right, where we're not like coercing a user to download the app, right, which is which is annoying.

2:12:12

Um you know, finding that balance and doing that in the right way, I think that again, there's a lot of There's many ways to do it, and I think there's a good way somewhere in the middle with a lot of finesse, but that's actually where we spend a lot of time thinking. Yeah.

2:12:25

How does the average Reddit user feel about AI? Mhm.

2:12:32

Well, I think the average Reddit user is basically the average person. Yeah.

2:12:38

And I think AI right now is polling less than politicians. Yeah.

2:12:45

And and and last I checked, nobody likes politicians.

2:12:48

politicians. So, it but at the same time, But the but the difference the difference but the difference there that I think is funny is like like people like, you know, may have a negative experience with politicians, but then but with AI, like people like

2:13:04

say they don't like it, but then they have like all these magical experiences in their life and they use it like crazy and it makes their life better in even bunch of different small ways uh in in ways in ways that they're aware of and ways that they don't they aren't aware of, right? Like it's happening

2:13:17

Like it's happening under the hood.

2:13:19

And so, I think at some point I I think at some point it will actually flip, right?

2:13:23

Just because it's like a very valuable magical tool that anybody can benefit from.

2:13:28

We're we're going through that transition. Yeah, exactly. AI Do Do you like AI?

2:13:32

People's overwhelmingly negative. Do you use AI every day?

2:13:38

Every It's like everybody. Yeah.

2:13:38

Um and and and you can see this kind of you can see this relationship with Reddit as well.

2:13:46

Um AI makes not just Reddit but the whole internet safer. Right?

2:13:50

Things like like violence, harassment, bullying, we can use LLMs now to find and and and just fil- filter out to moderate out at at platform-wide scale in seconds.

2:14:02

It's incredibly powerful. Right?

2:14:04

The worst job in the internet used to be looking at the worst content in the internet. Yeah.

2:14:09

People don't have to do that anymore.

2:14:10

Um so, that's really powerful.

2:14:13

It also happens kind of behind the scenes.

2:14:15

Um, but then AI writing like on Reddit and elsewhere is just kind of annoying. Uh, right?

2:14:23

And we're going through this You see this on Reddit where it's it's not prohibited behavior.

2:14:26

Like a human being with a human account uses ChatGPT to make a post. >> Yeah. Like that's allowed.

2:14:33

But then you see all the comments just flaming them. Right? Thank you, bot.

2:14:36

Um, thank you, bot is like the new okay, boomer. Yeah.

2:14:40

Um, and and then of course there's just like the maybe spam and other bad behavior, which is definitely not allowed. Yeah.

2:14:46

So, but but I think like on Reddit, in emails, in school, we're going through this societal like calibration about where AI is helpful and not helpful. Yeah.

2:14:57

How did you process Molt Book? Oh, yeah.

2:15:02

Oh, uh, I I think I clocked that one uh, within 5 minutes.

2:15:05

I said, this will be a meme for about a week and the world will move on. Uh, and and it was.

2:15:12

It was it was like a total insider AI meme like fun thing.

2:15:18

You know, uh, you know, if if if if if the accusation is is on the internet, uh, the internet's dead, everything's turning into bots, it's bots pretending to be humans.

2:15:26

On Molt Book, it was a bunch of humans pretending to be bots. Oh.

2:15:28

Uh, and so it was like to me it was like AI fan fiction.

2:15:33

Uh, it was like so so goofy.

2:15:36

Funny, but goofy and and otherwise insignificant. Yeah.

2:15:41

What what has been uh, what is like walk us through like the history of of like bots on Reddit, how you've dealt with the problem, when they've been uh, bugs, when they've been features.

2:15:54

Like that's a big I mean even >> Yeah.

2:15:57

even uh, you know, on on X right now it very much feels like a bug.

2:16:01

You there's certain accounts if you look in the comments, you can just tell like, you know, every single comment was written by a bot.

2:16:07

It doesn't add anything to the conversation at all.

2:16:12

>> years ago everyone was tagging those bots remind me or bookmark this or all those things.

2:16:17

>> like the the Ask Rock is like 50% of the time it's annoying, 50% of the time it like adds relevant context that improves the experience.

2:16:29

>> Yeah, so I think I think the solution to this issue was and always has been through transparency and intentionality. Mhm.

2:16:35

Um we've always had on Reddit helpful bots, right?

2:16:41

The remind me bots and the haiku bot and uh maybe less helpful, but accepted like the grammar correcting bot. >> Sure.

2:16:49

Um and then we've had bad bots, but bad bots we just call spammers. Yeah. Right?

2:16:54

They're They're submitting spam or they're otherwise manipulating Reddit.

2:16:57

That's always been forbidden and we do our best to remove those.

2:17:01

I mean, we do it at an absolutely massive scale.

2:17:04

It's like 100,000 to a million accounts a day that we ban. Mhm.

2:17:06

Um and then with AI it's not a new problem, there's just new technology.

2:17:14

Uh and so again, if you're manipulating Reddit, if you're spamming, if you're pretending to be a human but you're not, that's not allowed. You get banned.

2:17:22

Um but we also want to leave room for helpful bots or even agents, but I think they need to be labeled as such.

2:17:30

Um and then there's that gray area, which is what we're talking about before, which is a human being using AI to write.

2:17:37

Um that's not forbidden, but it is kind of annoying, but we'll let that one play out.

2:17:43

And right now what we're seeing is people downvote it, they complain about it, communities maybe ban it.

2:17:50

Um Yeah, but at the same time if for every for every for every post there when when a human with AI was, you know, writing something, posting it, and it's getting negative feedback, there has to be like a number of them that used AI that people don't even know they used AI and and it is just being additive, right?

2:18:11

Like it's not >> It's possible.

2:18:11

It's possible and in which case um it's probably okay.

2:18:16

I think the question is is there a human behind the prompt? Is it a human's idea?

2:18:20

Like I'll give you an example of of AI content that's totally acceptable. Um translated content. Oh, sure.

2:18:27

>> Like I'm a non-native speaker.

2:18:27

Like help me help help me write better.

2:18:30

Like that's just the world we live in now. Yeah.

2:18:32

Um and so for us, like Reddit is for humans.

2:18:38

Like that is our platform. That is our product.

2:18:40

It's human connection and community.

2:18:42

So uh we're going to start actually talking about this more so that this is a really apt time to have this conversation.

2:18:48

This idea of humaness and human verification and what I call ass in seat.

2:18:54

Like is there actually a human using Reddit right now regardless of the tooling that you're using? Yeah.

2:19:00

How how do you how do you think about delivering on that?

2:19:04

I think I think the most light way I think there's various technologies.

2:19:07

The most lightweight way is with something like Face ID. Face ID or Touch ID.

2:19:12

Broadly, that's it's in a family of technology called passkeys. >> Yeah.

2:19:17

Which I actually didn't appreciate about these like a year ago.

2:19:21

They actually require human presence.

2:19:23

Like a human has to touch or do or look at something. Yeah.

2:19:25

And so that actually just proves that there's like a person there.

2:19:29

Or it gets you gets you pretty far. Yeah.

2:19:31

Um and so I think that's very lightweight and accepted.

2:19:33

Um I think there's heavier versions like um you know, the ID checking services >> Mhm.

2:19:40

which we have to use, you know, for for um you know, regulations here or there. >> Yeah.

2:19:45

And I think there's in between technologies um like that the internet really needs.

2:19:50

Like third-party individual no ID required decentralized like I I don't want to say identity, but like information providers that that there's a there's a need for on the internet because not just Reddit, every platform wants to know is this a person?

2:20:13

Now, Reddit's version is is this a person, but we don't want to know which person this is.

2:20:19

Right, this part of our promise to our users is we don't know your name.

2:20:22

But we do want to know that you're a person.

2:20:24

And so it'll be an evolution for us, I think for a while and probably every platform, I think to find the right kind of middle of ground here.

2:20:36

Seed stage or Series A startup wants to unlock revenue on Reddit, what advice do you give them outside of giving you ad dollars? Build a great product. Build a great product.

2:20:49

I mean, that's my advice for every startup. Yeah.

2:20:53

Like build something >> they shouldn't do a hostile takeover of a subreddit.

2:20:57

[laughter] Uh look Cuz I know you guys I mean, I know that's like an on ongoing ongoing issue.

2:21:04

>> I think I think that is a very difficult thing to pull off.

2:21:08

You know, there there's always that startup that they build something really great and the the founders are super authentic and they can show up on Reddit and say, "Hey, we built this. What do you think?"

2:21:17

And and everybody loves it.

2:21:19

And then the other 99% of companies get like chased away for self-promotion. Yeah.

2:21:25

Or they're manipulating Reddit in some way Yeah.

2:21:27

and you know, we end up banning them.

2:21:30

So uh it starts with building a great product.

2:21:35

Um and then from there you got a lot of options on Reddit. Mhm.

2:21:37

Right, yeah, of course you can be an advertiser, but you can also talk to your customers, you can provide customer service, you can do AMAs.

2:21:45

There's all sorts of things you can do.

2:21:48

But I think the only ones who are successful are ones who uh I think have an earnest desire to contribute to a community Mhm.

2:21:57

and not take advantage of it.

2:21:57

Because people are very sensitive to being taken advantage of. Yeah.

2:22:01

What are What are the unique uh dynamics on Reddit when it comes to creating ad products?

2:22:09

You know, Meta Meta, you know, and and Instagram seems to be the ultimate uh state that a that a user can be in, just like pure consumption.

2:22:18

They get shown cool things and and uh they're kind of whatever state of mind they're in that there's an openness to like, you know, immediately just buying something.

2:22:27

I would say X is maybe the opposite of that.

2:22:31

I think did Ben Thompson describe it as like you go on Reddit to like >> a knife [laughter] fight. Yeah.

2:22:35

You go on X to get You go on X to get in like a knife You know, you're like you're there to like >> When you're on Instagram, you're shopping.

2:22:42

You're shopping for everything.

2:22:43

I mean, Instagram's product would be better if it was only ads. Yeah, I know.

2:22:48

>> [laughter] >> So So uh Well, in some way in some way it is.

2:22:51

I mean, for me for me I like uh my my explore page is just cars and watches.

2:22:57

>> Yeah, cars, watches, clothes.

2:22:59

>> They're not directly ads, but they're like functionally I'm like being marketed to, but it's just UGC. >> Yeah.

2:23:05

So So on Reddit you know, what's interesting about Reddit is that people talk about their interests and hobbies and passions. Mhm.

2:23:12

What I What I didn't see coming when we started Reddit is that it turns out in within people's interests, hobbies, and passions it's a lot of commercial conversation. Yeah.

2:23:23

They're basically asking the question of what should I buy. Yeah.

2:23:24

But they don't say what should I buy.

2:23:27

They say what should I wear? What should I watch? What's the best gear? Like, where should I go?

2:23:34

And so it it turns out that Reddit which has this kind of anti-commercial vibe is actually extremely commercial.

2:23:44

>> for commercial activity.

2:23:45

>> what people talk about. >> Yeah. Yeah. Totally.

2:23:47

>> And so that's why I say for brands like you can stick the landing.

2:23:49

Yeah, like it it's there.

2:23:51

The conversation is happening.

2:23:53

Um but again, transparency and intentionality, that's what that's what really matters.

2:23:59

And so yeah, ads is the easiest way to do it.

2:24:02

Um but also you can be helpful to your customers, which are definitely on Reddit talking about your product.

2:24:09

Yeah, can you help me understand the shape of the advertising business?

2:24:10

It's is it is it the entire revenue stream?

2:24:12

I know that there's there's deals with other companies and there's other other pieces of the of the business throughout history.

2:24:20

And then uh how power law driven is it?

2:24:23

A lot of ad platforms have like a super long tail tail of small advertisers.

2:24:28

We've talked to other folks with ad platforms where they're selling really big ticket packages to Fortune 500 brands and it's all shaking hands and kissing babies.

2:24:37

They're basically a politician all the day.

2:24:41

>> It I think that the the story arc of any ad platform is basically the same. Okay.

2:24:45

You start with big companies and brand advertising.

2:24:52

Cuz that those are the companies that will test new platforms.

2:24:56

And then you simultaneously move down market into mid and small businesses and more performance oriented. Yeah.

2:25:03

What's great about Reddit is we do all of this.

2:25:05

So our fastest growing segments were mid and small business last year.

2:25:09

We have a nice balance between brand and performance.

2:25:11

And so we're one of the few platforms that whatever your objective is >> [snorts] >> and whatever the size of your company is, Reddit can work for you.

2:25:23

Um now, almost all of our work in the ads platform, it comes down to, you know, better measurement and better targeting. Right?

2:25:31

It's really just a game of inches, just constantly grinding that out and making sure that our ads actually work, actually deliver a return.

2:25:37

Um but Reddit, it's it's so funny to me cuz when we started Reddit, I didn't like ads.

2:25:42

Now, this was 20 years ago, so so you know the the the pressures of the real world have made an honest man out of me.

2:25:50

Um But so it's it's almost surprising to me how good Reddit is for this. >> Yeah.

2:25:55

Um and so it's it's it's a never-ending journey.

2:25:58

But to answer your question before, about 95% of our revenue is ads. Yeah.

2:26:02

Uh it's actually a great business model because it just scales.

2:26:06

I Yeah, it makes perfect sense. Yeah.

2:26:08

If an investor came to you looking for alpha, what subreddit do you think there's a 10 hundred billion-dollar business brewing uh business opportunity brewing in?

2:26:20

I think like like Chris Dixon has talked a lot about like he'd find a subreddit that was, you know, a a hive of activity.

2:26:29

>> idea of what people do on the weekend for free will all be doing during the week in a few years. Oh.

2:26:36

Well, it's an interesting question.

2:26:38

There's so We're in this like funny state that like we're in this like vibe coding takeoff. >> Yeah.

2:26:47

So I I I look at kind of the arc of of of my career over the last 20 years.

2:26:53

And I was lucky to catch a couple of waves.

2:26:55

But the first wave uh was just the internet.

2:27:00

And I well, I think of each of these waves as a lowering of the bar of what it takes to start a business. Yeah.

2:27:04

So first is the internet.

2:27:08

Um then there was the access to capital.

2:27:12

So like Y Combinator and the more democratization of of of investing.

2:27:17

Um and then you got mobile.

2:27:20

Uh and then you got cloud.

2:27:22

So now like to start a successful company, you can build an app and host it in the cloud.

2:27:28

But the equivalent version of that 20 years ago or 30 years ago was you had to know enough people to raise $10 million to even get your foot in the door.

2:27:34

You had to go to the computer store.

2:27:35

Yeah, but you still had to be technical.

2:27:40

And now we're in this era with with vibe coding.

2:27:42

Vibe coding is such a small word, I think, for such a big concept.

2:27:46

Which is like basically if you have an idea, you can basically bring it to life.

2:27:52

And that's becoming more and more true every day.

2:27:55

And so one of the things I've been thinking a lot about is like the headlines are all like such and such company let's go of all of their engineers.

2:28:04

Like engineers are being replaced by AI.

2:28:07

I think that's missing the next step.

2:28:10

Like these engineers are builders.

2:28:13

What do you think they're going to lose their jobs and just go home and sit on their hands?

2:28:16

No, now they will probably start companies of their own.

2:28:21

And and so I I think there's this transition.

2:28:26

I think it's going to be very very fun where everybody's a builder.

2:28:31

And there's likely to be this like Cambrian explosion of creativity and creation.

2:28:37

Um Yeah, but when I think about it in the context of Reddit, there's like all these subreddits that might only have like 5,000 active members and historically they maybe had an idea for like a little vertical software product or a mobile app and like it would never make sense for a team of five brilliant engineers to like raise millions of dollars and then go and build that product because the TAM is like the 5,000 people.

2:29:02

But then you actually can do that now because it's just one person that's like, "Hey, if I can even get it like a few hundred of the people in this subreddit to pay me to use this product, I can like have a real business and I can create a life."

2:29:17

So it's like >> more like niche podcasting or having a Patreon.

2:29:19

It's like Yeah, it's the same same exact thing is what's happened in media, right?

2:29:22

media, right? In media it's like >> paying you five bucks a month like Yeah, this this show wouldn't have been able to exist with cable because like you wouldn't it would just be like yeah, it's just it's too it's too niche and so

2:29:35

yeah, I think like every subreddit should like there is a software product to be built and it's not necessarily like a venture scale opportunity, but you just do the math and like can I get a thousand people that pay me 20 bucks a month and like great. That's that

2:29:47

That's that replaces the salary that that you that person may have gotten.

2:29:54

It's it's the whole story of the internet which is the transition from centralized traditional power to decentralized.

2:30:03

And so it's it's this Yeah, really enabling and uplifting force.

2:30:09

Yeah, podcasts are such a great example of the decentralization of media.

2:30:14

And so now I I think with AI there's just going to be this a whole new era of creation which I think is the optimistic side of the story.

2:30:21

I'd love to hear more of.

2:30:26

Cuz I think the pessimistic side is the the transition and the change.

2:30:31

But I don't think the outcome is all bad.

2:30:32

I think it's actually could be quite empowering.

2:30:35

What what are the give us a guide to watches on Reddit?

2:30:39

What are the best sub sub communities?

2:30:46

I don't know if I can like with a with a clear conscience recommend anybody get into watches on Reddit.

2:30:51

>> [laughter] >> It's like a it's it's it's like I fallen into that for better or for worse.

2:30:57

So you can start with watches.

2:31:01

And then maybe you should start with like watch I forgot it's called like watch hot takes or something.

2:31:06

But just to see like people who are coming out on the other side of this.

2:31:10

Um But yeah, I mean like In ruins. In shambles. In shambles.

2:31:15

It's just a [laughter] gosh.

2:31:16

It's it's a it's it's a It's a pit.

2:31:19

I don't I don't know how to describe it.

2:31:21

Like valueless consumerism.

2:31:23

Like just >> [laughter] >> It's like telling somebody it's like what's the best subreddit about smoking?

2:31:30

It's like I don't know if I can >> [laughter] >> That's good.

2:31:33

Is is Vacheron underrated? For sure.

2:31:37

That's their whole strategy is to be underrated. Yeah.

2:31:40

I think like high quality and and and and unhyped.

2:31:42

I think I think their CEO just had an interview where he basically said that's our strategy.

2:31:49

I know but but people are going to figure that out.

2:31:51

They're like this this is you know it's it's going to be properly they're going to they're going to prop the internet will do its thing and it will hype it properly. >> Slowly though.

2:31:58

Yeah yeah I know what look look it's just the life cycle of hipsters, right?

2:32:02

I was there before it was cool. Yeah yeah totally.

2:32:06

Uh maybe over 10 years ago 2012 you taught me Python on Udacity.

2:32:10

I took I took that actual course introduction to back-end development.

2:32:15

Why did you teach that course?

2:32:20

Oh okay so the very specific reason is uh one of my um favorite professors at UVA uh what was at the company and so he invited me.

2:32:33

He said Steve do you want to teach a class? And so and I did.

2:32:37

Uh it was it was intro to web development. >> That's right.

2:32:40

It ended up being in in that era so it was like 2010 11 somewhere 12 I guess.

2:32:44

Um ended up being one of the more popular classes. It was so fun. It was so fun.

2:32:49

You know it's actually funny still still I get recognized in public from that from that much more than Reddit. That's crazy. That's crazy.

2:33:01

>> This guy behind me pops over my seat. He's like Steve Huffman? I was like yeah.

2:33:05

I was like you know and he's like he's like Steve I heard your voice. I learned to program.

2:33:09

I listened to your voice for like 40 hours. It's like in my brain.

2:33:16

And honestly it's the greatest feeling.

2:33:19

I would love to do that again.

2:33:19

I should make time for it. >> You should.

2:33:22

>> Because because I just meet people for whom it it it it it helped make their life better.

2:33:28

It's it's truly it was the greatest honor. Um it was so fun.

2:33:29

It was fascinating cuz I mean the content was good.

2:33:34

But there was something about the fact that it was coming from you for someone who had actually built something and the story of Reddit was so intertwined with Y Combinator at the time and and building something sort of without the permission of the

2:33:49

big machine that was, you know, traditional you know, software development or some mega corp and and yeah, it was it was just way easier to pay attention, I think, because it was like, "Oh, yeah, like you could imagine yourself building something similar." And it was yeah, it

2:34:03

And it was yeah, it was inspiring. I really appreciate it.

2:34:06

Well, thank you so much for taking the time.

2:34:09

Have a great rest of your day.

2:34:09

Have a great weekend and we'll talk to you soon.

2:34:11

Yeah, great having you on here.

2:34:13

>> that story and guys, thanks so much for having me on.

2:34:15

This was a real pleasure. Yeah, this is fantastic. Awesome. We'll talk to you soon. Talk soon. Okay. Take care. Bye.

2:34:21

Let me tell you all about Okta.

2:34:21

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2:34:27

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And let me also tell you about Restream.

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One live stream, 30 plus destinations.

2:34:33

[music] If you want to multistream, go to restream. com.

2:34:37

And we have our second in-person guest.

2:34:40

We have Quade Walker from Bezel.

2:34:40

How are you doing, Quade? Doing great. Thanks for having me.

2:34:44

>> Welcome back to the show.

2:34:44

Thanks so much for taking the time.

2:34:46

Dude, look at this mogger right here.

2:34:49

>> [laughter] >> Look at this mogger. Let's go. >> day on TGI.

2:34:55

Every dude that comes in >> Dude, get a you need a bigger shirt.

2:34:59

I'm [laughter] trying to keep up with you guys up here. It's good. It's good. How's life? It's great.

2:35:02

You guys let me hear Steve talk about watches. >> Yeah, yeah, yeah. Yeah, it was good.

2:35:08

>> He's like, "Don't get any watches."

2:35:09

>> yeah, yeah, yeah, yeah.

2:35:09

We'll we'll we'll let you react to everything you guys say.

2:35:12

Vacheron, underrated overrated? Underrated. Underrated. Why? Explain their strategy.

2:35:16

Explain how they fit into the landscape of strategies that are run by other brands.

2:35:20

How do they differentiate? Why?

2:35:22

I mean, from a history perspective, been around for obviously an insanely long period of time.

2:35:27

I think they have the hype models.

2:35:30

They have the overseas, obviously the 222.

2:35:33

You're seeing a lot of celebrities wear it.

2:35:35

I think like the famous Brad Pitt wearing it and kind of the pre of the F1 movie made it go crazy, but it was the vintage example of it.

2:35:41

They released the new one.

2:35:43

But I think still it doesn't feel like it's at the same hype levels as like an Audemars Piguet or Rolex or things like that.

2:35:50

So, it's in the the top three, but I think from a cultural perspective it's not totally up there yet.

2:35:55

So, it's super cool to have that mix where it's got the heritage, but not necessarily the hype quite yet despite being very hyped.

2:36:02

He mentioned a Reddit watch hot takes.

2:36:05

I don't know if you've spent time there, but what hot takes do you have about watches?

2:36:09

>> Ooh, that's a good question.

2:36:11

Um Or or what is a even what is a popular hot take that you see, tried it out, that maybe you disagree with, something like that?

2:36:17

I think like the the hot take in the watch world right now is like this quest for independent brands.

2:36:21

Like I think uh We have a lot of clients that are diving into like the Journe market, for example, and it's like absolutely going crazy and like the Journe Elegante, for example, like the Dude, I I I I added that to my bezel like watch list. >> Yeah.

2:36:37

And at the time when I was adding it, you could get one for like 90 and now they're like 120.

2:36:42

>> We I was talking talking to two clients yesterday in 2024, we got each of them an Elegante.

2:36:49

One paid 42, one paid 53 for it.

2:36:51

And now they're like 170,000 for that watch.

2:36:57

So, and that's a quartz example, it's very cool.

2:36:58

You you put it on their wrist and it it'll it'll kind of go to the time it is once you put it on.

2:37:04

So, like it kind of stacks itself.

2:37:07

Um >> And tell the story of FP Journe.

2:37:07

Like why is that company interesting right now?

2:37:12

I just like a scarcity thing right now in the sense that it's it's like the There's a few of the brands, Journe being one, like Akrivia being one, that there's so much storytelling around the mastery of the watches that they're creating.

2:37:24

But then also, there's so few of them made, and so they get wiped up in this kind of hype cycle.

2:37:28

And then they end up being so heavily demanded by the same type of collector that would have maybe started their collection buying Rolexes and moved to Patek, and now this is like the upper echelon.

2:37:36

One thing that Journe does really well is whether you buy a Journe on the secondary market or the primary market, they kind of welcome you into the community. Which is super awesome.

2:37:45

It feels like a black mark when you go into some of these stores and you actually get in.

2:37:50

And so, like they [laughter] they're excited that you have access to it.

2:37:52

You would sheepishly admit. Yeah.

2:37:54

Is there Should I Can I mentally comp Journe to Koenigsegg in the sense that Koenigsegg is, you know, this very Okay, the watches work.

2:38:06

But But But a lot of people will say, you know, Koenigseggs, they're expensive, maybe there's downsides, but Christian von Koenigsegg is alive.

2:38:14

You can get on the phone with him, you can see him at an event, and you can't do that with Ferrari, you can't do that with the Lamborghini, and you But you can with a Koenigsegg.

2:38:23

And similar to Patek, AP, Vacheron, the founders, the real creators, are long gone, but not so with FP Journe.

2:38:33

Yeah, I think the community aspect of Journe is really vibrant in that sense.

2:38:37

Like there's a lot of events that are happening in LA.

2:38:38

In Geneva, there's a Michelin-starred Journe restaurant.

2:38:41

Uh yeah, so there's a lot of access to the brand in ways that I I think build that mystique.

2:38:47

But ultimately, it comes down to the watches.

2:38:48

If you're a Journe collector, you know that there's a period of time in the year where you everyone gets emails that lets you know if you get an allocation that year or not.

2:38:55

It's not as sporadic as collecting other pieces.

2:38:58

So, like everyone knows to check their email around that period of time in the year, and like we're in the collector groups, they're talking about the acceptances forever. Exactly. Yes.

2:39:06

What What I want a recommendation for you for a tech person getting into watches.

2:39:12

Uh In terms of budget, let's assume that they're just like a mid-range AI engineer.

2:39:15

They have like $100 million to spend. What would you do?

2:39:17

[laughter] Uh I was just going to be talking about this backstage with very different budgets than $100 million. No. No. No.

2:39:24

Let We we we we can ladder it up.

2:39:24

Uh what what's a great watch that's just a good starting mechanical watch to actually get you into the world of horology?

2:39:33

>> Yeah, so that's the that's the most fun part of my job is is we sell the vast majority of the kind of full spectrum.

2:39:38

Cheapest watch we sold was $750. Most expensive is 1. 6 million. So >> Wow.

2:39:43

full [laughter] spectrum. Oh, there we go.

2:39:45

Uh and we just hit a billion in supply 2 months ago. So a lot of access. >> Gong. Gong. Gong. Hell yeah.

2:39:55

Um But yeah, it really depends on price point.

2:39:58

Obviously, there's a lot of interest there.

2:40:00

Like, you know, I for the Let's say through like 10.

2:40:02

Sub $5,000, I always go like Tudors and Omegas. Things like that.

2:40:06

I love the like kind of Tudor Black Bay offerings. I think they're so fun. Uh sub >> me.

2:40:13

I wasn't super into the hand design.

2:40:16

But >> 54 is like one of the best kind of vintage reissues that that's happened in kind of modern era. Love that watch.

2:40:21

Uh sub 10, uh I think vintage Rolex or like, you know, neo vintage like 90s Submariners like a 16610.

2:40:31

And what's reliability like with a 90s Rolex?

2:40:33

Is that going to be able to be a daily drive?

2:40:37

>> I so I have a couple watches.

2:40:37

My my daily is a 16610 90s Submariner.

2:40:43

Uh it's probably the the most vintage you can go while you're still trusting that it's like pressure tested and everything's working okay.

2:40:50

I surfed in it this morning. Uh I worked out in it. I run in it. I I love it.

2:40:54

I I I think I'm a big fan of using your watches.

2:40:56

As you scale up from 10 >> Working out with a watch on.

2:41:01

What hap Like, what are the downsides?

2:41:01

I think I think maybe curling is a little bit inhibited.

2:41:07

Overhead press maybe on the wrist, but yeah, I don't know.

2:41:11

yeah, I don't know. I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I

2:41:19

I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I that I I want to recreate that. And and

2:41:30

And and James Bond only wore Rolex in the books and maybe one movie and then Omega got the I think it switched to Omega in the Pierce Brosnan era.

2:41:39

Prior to that, it was deal or something.

2:41:42

Yeah, I think the acquired podcast did a whole deal with Omega winning that deal. That's right.

2:41:47

What are you wearing today?

2:41:47

I'm wearing a Rolex Daytona in platinum. Heavy hitter.

2:41:51

Yeah, platinum is a It's a heavier material, right? >> Quite heavy.

2:41:55

Yeah, it's actually You should We should afterwards you should you should try it out, but it's quite heavy. It's a workout.

2:42:00

Oh, watch those when it comes by.

2:42:01

It's like you could you could take it off my wrist. Take it for a spin. Take it for a spin. No, no. Jordy, what else?

2:42:06

Uh how how is the watch industry navigating tariffs at this point?

2:42:13

There's a lot of confusion. There's new tariffs.

2:42:18

Uh what is what is the approach from the manufacturer side?

2:42:20

I know on the secondary side, if you owned a bunch of watches, it was great cuz they just start going up in value even though there's not necessarily like more demand.

2:42:29

It's just like kind of a leveling.

2:42:32

It's funny to talk about it this with you guys cuz the last time I was here, I think I had just gotten back from Geneva in like April when they announced it. Um Yeah.

2:42:40

And so it's >> that that was What was that What what event were you Uh Watches and Wonders.

2:42:46

So they the initial I think it was like 10% or 15% with the initial tariff was was announced while I was in Geneva, and then I came back and chatted with you you about like the overall experience.

2:42:56

And then it shot all the way up to like 39 or high 30, 39%.

2:43:00

Um and then came back down to 15.

2:43:00

And so um throughout that cycle, the first thing that happened is exactly what you were describing where folks who had watches in the US immediately shot up in value and there was much more demand cuz two things happened.

2:43:13

One, the pricing goes up but also the access goes down.

2:43:14

If you're a like a dealer in the US that gets a portion of your supply from Europe, now it's way more expensive to get the watches in.

2:43:22

And so, the first order of effect is pricing like you were mentioning.

2:43:26

The second is uh our authentication reports like the number of watches that we reject.

2:43:31

In H1 of last year, we rejected 27% of the watches.

2:43:35

In H2, we rejected 38% of the watches.

2:43:37

And my thesis on that is just if you were a dealer in the US and you had less access to inventory and all of a sudden it became more expensive, you were incentivized to get creative and try to pass things through the system.

2:43:49

So, maybe you're swapping dials, maybe your watch that's been pre-owned is polished or and you're marking it as unworn.

2:43:53

Like, you're doing what you can to get the throughput through that you would expect given the fact that the inventory is limited.

2:43:58

And so, um that's been kind of a second-order effect.

2:44:01

Where we are now, I feel like prices are still increasing.

2:44:04

There's less tariff talk than there was. Yeah.

2:44:09

Um I think people are starting to accept the reality.

2:44:11

Brands increased prices pretty broadly.

2:44:15

Um some brands then pulled back the price increases.

2:44:19

>> [laughter] >> Um but like Patek, for example, pulled back the pricing increase.

2:44:22

Some brands have not pulled back the pricing increase and so it's kind of a per brand thing.

2:44:28

The reality is a lot of these brands can charge twice as what they charge right now and everyone's going to still buy their watches.

2:44:33

And so, I think brands have different opinions on >> increase from Patek doesn't affect that many people.

2:44:38

There's no way they can >> did you surprise that collectors and groups felt slighted if they, you know, they just felt opportunistic if the tariffs went down.

2:44:45

And so, I think a lot of these brands are optimizing for building a relationship for hundreds of years with their clients, not just, you know, doing better in the short.

2:44:52

>> to talk Oscars reactions.

2:44:52

Kevin O'Leary was spotted wearing two watches, a Cartier Crash skeleton and a ruby set Rolex Daytona. Yeah.

2:45:01

Potentially doubling the market size for watches. Are you behind this?

2:45:05

Are you pushing this two watches on one watch on each >> the You got your You got the Whoop on.

2:45:11

>> Yeah, I'm wearing I'm wearing a Whoop on my other side, which I think I even feel like I'm I'm kind of a clown for for doing that in some capacity.

2:45:16

I'm I like I'm a one wrist man. >> Yeah, yeah, yeah.

2:45:19

Um but, you know, it's it's good for our business if anyone wants to wear it on two two wrists.

2:45:23

And I think if you are passionate about watch collecting, if you're doing it for that reason, that's amazing.

2:45:29

I've been seeing a lot of jump hours.

2:45:30

Those seem to be popular at the Oscars this year.

2:45:35

Is there a broader trend there that you're picking up on?

2:45:37

>> as people dive deeper into watches, the symptom of that is that I think people are more interested and like higher horology pieces, more complications, that and so it's kind of that initial sweep that I was talking about with folks getting into independent pieces, where it's no longer just like to talk to myself, like I want to wear the platinum Daytona.

2:45:54

It's now, you know, I want something that is particularly independent brand that other collectors will raise their eyebrow brow and get interested about.

2:46:01

And so jump hour being a really fun complication.

2:46:03

It's also just a cool thing to look at on the dial, but I saw I saw a guy on Instagram who uh basically just does 3D renders of ideas that he has for watches.

2:46:12

And he had one The whole thesis was the the watches are often photographed at 10:10.

2:46:20

So, uh the hour hand this way and the and the minute hand this way because that's the most aesthetic presentation.

2:46:27

And so he designed a set of watches that where the the hands would be fixed at 10:10.

2:46:31

And then you would have a jump hour over here and a minute wheel over here.

2:46:35

There'd be a whole variety.

2:46:35

One was like a flyback where you push a button and then it goes to the actual time, but mostly it's a 10:10. But a lot of fun ideas. Predictions for AP?

2:46:47

Is Rolex Yeah, I mean so so uh Rolex uh came out with the Land Dweller and a bunch of different watches that people love.

2:46:55

AP uh you know, I don't you know, a lot of the watches are uh for better or worse not super desirable outside of the Royal Oak.

2:47:05

I'm assuming they want to change that.

2:47:07

Like I think they're doing a lot to make the Code 11:59 like as interesting as possible.

2:47:11

And so like the Star Wheel is a great example or it's like a really awesome complication and it's really like the most exciting 11:59 right now, I think. >> Okay.

2:47:20

I'm hoping we get something in not a 41 would excite me. Like Smaller?

2:47:24

I we should >> But what about what about an entirely new silhouette?

2:47:28

I think it's It'd be awesome.

2:47:32

I just think it's less likely.

2:47:34

When did the Code come out? I don't know.

2:47:36

It And and is there Do they Do they have a Do they have a reason for that?

2:47:40

Like they're just like we don't need another one.

2:47:42

Well, I think it's it's it's quite hard to replicate the heritage and the excitement associated with the Royal Oak, right?

2:47:49

It's like you know, it's the like Genta design, 39 mm size, you know, the kind of the silhouette of the current 16202.

2:47:59

Um there's only four watches, you know, that kind of feel like they have that degree of a mystique and history around them and it's probably like you know, the Nautilus, the Overseas maybe um the Royal Oak and then like maybe the Daytona.

2:48:13

I think they're like the steel sports that fall into that category of of like hype cycle.

2:48:16

And I think it's very very hard to recreate that, right?

2:48:22

Um >> And you think Rolex is more like Rolex being like we're going to create the Land Dweller. Yeah.

2:48:28

>> And just like take a risk or Well, that's if you think about it, it's like Rolex Cubitus.

2:48:31

Like I'm just saying like you have like Land Dweller, you have Cubitus.

2:48:36

Like why not take the risk?

2:48:36

Rolex doing the Cubitus was like a crazy thing.

2:48:42

I saw Rolex doing the Lambada is a crazy thing.

2:48:46

Like it's they these companies move really slow and intentional and typically a new model is like the same reference but you know upgraded by one number a new caliber slight you know different perspectives on it but but ultimately the same model.

2:48:58

So maybe we're moving into a world where watchmakers are starting to be more ambitious but I think it would be like a kind of change.

2:49:07

And so I I would just expect Rolex to not come out with a new model.

2:49:12

I would expect AP to do the same but we'll maybe get some interesting dial variations interesting metal variations things like that.

2:49:19

I'm hoping for as I was saying like we both wear the 15300. I like the 39 size.

2:49:23

I think I if we got more access to that I think that would be really exciting.

2:49:29

Patek it's the anniversary for the Nautilus so there's some conversation around what that's going to be and what's going to come out there if it's going to be steel reissue if it's going to be another precious metal example.

2:49:40

Certainly we'll get something in the Nautilus side.

2:49:43

There's a lot of rumors around the the Rolex Pepsi and we've had those rumors for a number of years but you know there's some speculation on what's going to happen with that if it's going to get discontinued and things like that.

2:49:52

discontinued and things like that. Are there less leaks in the watch world because in the car world you have to actually like go and road test the car like people are posted up in Maranello like you know like just it doesn't

2:50:03

matter that the car is camouflage they're going to get a picture and be able to clock it if they pay enough attention whereas in watch making it's like you might have like a hand like only like three people that actually have knowledge and that are working on it. I can't profess to know the car

2:50:13

I can't profess to know the car example but I I I would imagine that logic makes sense.

2:50:17

The way the leak cycle typically works is like everything builds up to Watches and Wonders in April and we're in the stage right now where you get like all the fake leaks and AI has just made that even crazier cuz anyone now has the ability to like Photoshop whatever they think is and it looks legitimate.

2:50:35

Yeah exactly but it's like I could go and cook on, you know, any of these models and build out like what I think is going to be cool. >> Yeah.

2:50:41

And it looks convincing enough is like 5 years ago that was challenging. Yeah, totally.

2:50:44

Um but then as you get closer, you'll get real leaks and those are typically like they're uploading something on the website for a new banner and they miss something or there's a production video that's made and someone has the wrong file somewhere and they leak it.

2:50:56

And so as you get closer, sometimes historically those leaks have been correct.

2:51:00

And then Rolex will start teasing at themselves. And so >> Yeah.

2:51:04

for the Land Dweller, like they teased a like a hint of the integrated bracelet.

2:51:09

And everyone was like, "Oh my god, like it's the Oyster Quartz or what is that? I don't know." Yeah.

2:51:12

Um and so that's when they like start to stoke it.

2:51:15

And then Federer was seen wearing the Land Dweller, like, you know, a week before they announced it somewhere and everyone was like zooming in his wrist like, "Is that a Datejust? What is that?"

2:51:23

And so they they play into it, but uh it's typically how it goes.

2:51:28

>> Uh you you launched a partnership with Kalshi watch price prediction markets.

2:51:35

Uh I saw some funny criticism.

2:51:35

People being like, "This is dumb. Just buy the watch."

2:51:39

Which I thought was like a really dumb criticism because like obviously like not everyone wants to invest like 20, 30, 50, 60, you know, whatever it is and there's a lot of other dynamics that that make it pretty interesting.

2:51:53

How does that product actually work under the hood?

2:51:56

Like what what is the what is the partnership look like?

2:51:59

I'm assuming you guys have all of like the real-time kind of like pricing data.

2:52:03

Um but but tell us about it.

2:52:06

Yeah, so we we built the price engine internally.

2:52:10

Um like, you know, very nerdy, true machine learning model, mathematical consensus.

2:52:16

Uh our thesis was you can scrape public data.

2:52:19

So like we'll go out and we'll scrape the entire market.

2:52:20

But there's only a few players that are at our scale that have enough actual data.

2:52:23

And what I mean by that is like, you know, a watch might be listed for $10,000 publicly and that'll be what everyone scrapes.

2:52:31

But then it might actually be offered back and forth and sell for $8,700.

2:52:34

And that is data that is only private to like us and other marketplaces that have our scale. >> Yeah.

2:52:41

Cuz that data does need to be public. >> Exactly. 100%.

2:52:44

It's certainly not public.

2:52:46

And so, our thinking was, you know, we can build what we feel is the most accurate data available, and build out that model, and it's designed to be predictive.

2:52:53

So, it uses different inputs and values different inputs based on different models, and it's it's truly predictive.

2:52:58

And so, the thought was to use it internally for us to like badge listings as good price, uh for us to offer like some price guiderails for retail sellers, whatever it is.

2:53:09

And then, uh StockX she was kind of moving into collectibles, and so we connected.

2:53:14

And uh we were jamming on building some markets, and so uh for us, we're just the data kind of provider there.

2:53:21

We have no economics from it.

2:53:21

For us, it's like just an exciting thing for the watch world.

2:53:24

The watch world loves it.

2:53:26

We're going to double down on it.

2:53:26

If the watch world hates it, like we're going to learn from that.

2:53:28

Uh so far, the response has been largely very positive.

2:53:32

And we have two types of markets.

2:53:32

We have the qualitative ones, so that's like is the Rolex Pepsi going to be discontinued?

2:53:37

And the source data for that is like really Rolex if they're going to roll it out.

2:53:40

And then, we have quantitative markets, so like you can bet on the Rolex index, uh or it can be model specific, like, you know, will this Starbucks be above this price threshold by the end of March or something like that. That's cool.

2:53:54

Uh last question, will will AI ever be able to catch fake watches?

2:53:58

Like, could you have a process when somebody's trying to list a watch to just be like, yeah, just don't even send this to us.

2:54:05

Like, we don't, you know, we don't we don't want it.

2:54:07

Uh the blanket large or like quick answer is no.

2:54:12

Um we believe in in every watch getting in the hands of like the artisans on our authentication team.

2:54:16

They're smelling the papers.

2:54:18

They're feeling the weight.

2:54:20

They're looking at all aspects of it.

2:54:21

They're opening up all aspects.

2:54:23

Um however, we use AI and the computer vision at the listing process.

2:54:26

So, if you wanted to list the watches on your wrist, it would need to get approved by our team.

2:54:31

It needs to go through our model to make sure that there's no like obvious problems with it.

2:54:34

And then once it gets sold, it ships to us and then we use AI to optimize their flow.

2:54:38

And so, I don't want my team wasting any time doing anything they shouldn't do.

2:54:42

I want the product to be really optimized for them, but ultimately you have a watchmaker and an authentication specialist.

2:54:47

It's in their hands and they're feeling the watches and I believe that is forever how they'll be authenticated at least for the, you know, medium term. I love it.

2:54:54

Well, thank you so much for taking the time. >> Thanks, guys. Yeah, I'm Quaid. Great to see you.

2:54:59

And we will move on to our next guest, but first let me tell you about Cognition.

2:55:03

They're the makers of Devon, the AI software engineer.

2:55:05

Crush your backlog with your personal AI engineering team.

2:55:08

And I will also tell you about Finn, the number one AI agent for customer service.

2:55:11

If you want AI to handle your customer support, go to fin. ai.

2:55:15

And our next guest is Ankur Jain and this is part of our Lambda lightning round.

2:55:20

Let's kick off the Lambda lightning round.

2:55:24

Um, Ankur Jain [clears throat] is the founder of Bilt and we will let him into the TV bin ultra in just a minute. Let's bring in Ankur. How are you doing? What's going on, man? How are you?

2:55:34

>> It's been like a decade.

2:55:34

I was about to say, I saw your name and I was I was just trying to make sure I get to the doc. It has been a long time.

2:55:41

>> It has been a long time.

2:55:41

Uh, I think the last time we hung out was maybe in Silicon Valley, maybe in New York. Lots of good times.

2:55:46

You've been on an absolute tear.

2:55:47

Uh, get me back up to speed. Where's the business?

2:55:49

Uh, what's life like now? How's your 2026 going?

2:55:54

2026 has been uh, it's been a crazy year so far.

2:55:56

I can't believe it's already the end of March.

2:55:57

Um, we Well, first of all, we're based in New York now.

2:56:01

We got to get you guys out to the city. Uh, that's number one. Yeah.

2:56:04

We Today, this morning, I don't know if you saw, we just announced Bilt Hospitality for restaurants.

2:56:11

Um, so we >> And we look, we spent the last 5 years taking housing, which is the biggest expense for people in this in this country. Yeah.

2:56:19

And how do we bring hospitality to the housing market? >> Mhm.

2:56:24

How do you make your $2,000 $3,000 a month rent expense feel the same as when you stay at a luxury hotel? >> Mhm. So, you get rewarded.

2:56:31

Your experience is seamless. They know who you are.

2:56:36

When you sign a lease, you're not sending in paperwork.

2:56:38

All these types of things. Mhm.

2:56:40

We're now bringing that to neighborhood merchants.

2:56:42

So, today we announced with Chef Thomas Keller, Daniel Boulud, Major Food Group, Tao Group, Hakkasan Group, now a bunch of these major restaurant groups across the country, a way for them to design guest experiences end to end in the same way we did for housing, and allow you to do things like, you know, John, you go out to a a restaurant and you can say charge it to my apartment just like you would at a hotel.

2:57:06

And everything now becomes seamless. Amazing.

2:57:08

Um is the business entirely uh consumer-focused right now in the sense that uh well I I I think people think of Bilt as a fintech company, but also a a a credit card company with rewards uh component.

2:57:23

Um is there is there anything else to the business?

2:57:25

And then I want to know like why have previous attempts struggled because it feels like there's been needed innovation in this space for so long. Yeah, for sure. So, no.

2:57:33

So, our business is actually primarily B2B, but we are a consumer brand. >> Yeah, that's right.

2:57:39

>> So, we provide the hospitality software >> Mhm.

2:57:41

for apartment managers across the United States.

2:57:44

One in four apartment buildings run on Bilt. >> Okay.

2:57:48

And so, that's our primary business. >> Interesting.

2:57:51

We then have a marketplace with now over 45,000 merchants who are looking to connect with people who live in these apartment buildings, and we facilitate that connectivity. >> Yeah.

2:58:01

So, that's our core business.

2:58:03

Today, I think people often often misunderstand this.

2:58:07

It's about 11% of the cards linked to your Bilt wallet.

2:58:10

So, when you move into an apartment building, you can link your MX card, Visa the get a Bilt co-brand card, and use that to pay your rent, get rewards, use it at your local merchants.

2:58:20

About 11% of the cards linked to Bilt members' accounts are our Bilt co-brand card. But, >> Mhm.

2:58:28

89% of the business still comes from the broader ecosystem beyond the the card. Okay.

2:58:33

And and what's the what's the difference in the flow?

2:58:36

Are people coming in for the Bilt co-brand card and then expanding out, or are they are they or are you selling customers who are already in the ecosystem through other touch points the co-brand card downstream?

2:58:52

I mean, look, to your to your to your last question, it is so hard to break into housing. Yeah.

2:58:55

It is it's crazy fragmented world >> Yeah.

2:58:59

that people people have been happy to take paper checks up until 6, 7 years ago, which is crazy for your biggest expense.

2:59:04

And so, we started this company trying to pitch property owners, Mhm.

2:59:09

fell flat on our face, and then pivoted to say, "What if we went direct to consumers to consumers to build some momentum?"

2:59:15

That's how we launched the credit card. Yeah.

2:59:18

The card then got us momentum, >> Mhm.

2:59:20

which then allowed us to go back to property managers and say, "Look, we have hundreds of thousands of people at the time that are now using this card to pay their rent. >> want to pay with it.

2:59:30

Why aren't you using our software for all of your renters?" Mhm.

2:59:32

And then we kind of went back and then grew the business.

2:59:35

So, today, almost all of our growth comes from our housing partners and people who move into the building that want extra rewards get the card. Sure.

2:59:46

>> looks more like the traditional like Gap or, you know, Sephora or the >> just just to be clear, so you could be living in a building that runs on or with a with a landlord that runs on Bilt, you don't you can still get rewards just through Bilt, but then you can add the card, and so you're just it's like B2B2C Yeah. That's exactly right. That's cool. >> Yeah.

3:00:05

And and again, most of the most of our revenues come from the housing platform and the merchant platform. Sure.

3:00:11

So, it's if you think of it, property managers and merchants, our business model is similar to Shopify if you're familiar with it. >> Sure.

3:00:18

We provide the infrastructure. What's Shopify?

3:00:22

>> [laughter] >> They're business sponsors. No, no, I'm kidding. I'm kidding.

3:00:24

Uh so so so these property managers and merchants, we want to connect neighborhoods like a hotel. Yeah.

3:00:32

So, they run on our experience platform.

3:00:35

They pay us for the software.

3:00:35

They pay us for the transactions or the customer pays for the transaction depending on the model.

3:00:40

And then we get paid when we send customers to local businesses.

3:00:42

And that's how we're able to fund these rewards across the ecosystem. Yeah.

3:00:50

Well, what were people getting wrong during that era where there was a whole bunch of skepticism around like is it ever going to be economically rational to give points for something as big as a rent purchase?

3:01:01

Uh it felt like there must be some sort of narrative violation there because you have Ken from Amex on the board or it seemed like your close investor.

3:01:10

Like it didn't seem like you went into that like blindly.

3:01:11

There was clearly a strategy.

3:01:13

So, what were people getting wrong?

3:01:16

Well, I think people were just missing what the business was.

3:01:17

I mean, there the reality is as you know, it's not sexy and fun to talk about B2B software.

3:01:24

Well, we we [clears throat] think it is. We love B2B software.

3:01:26