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Linear, of course, meet the system from modern software development.
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6:04
Um, so, uh, in the news today, Tesla is sharing that they made a ton of progress on their lithium refinery.
6:12
And then simultaneously, AWS did a deal with Riotinto to buy a bunch of copper, not that much copper.
6:18
We'll get into how much, but uh, they're sort of underwriting a new a new chemical process for refining copper.
6:24
Uh, and it's also sort of interesting that uh, you know, Mark Andre published the software is eating the world story back in 2011.
6:32
And I I think even the folks in tech who took that seriously were saying, "Oh, yeah, of course."
6:39
Well, that just means that >> I didn't take it seriously. I took it literally.
6:43
[laughter] >> You took it literally. Yeah.
6:46
>> But the people that took it seriously were thinking, "Okay, well, you know, you're you're going past just the the first wave of the internet, the newspapers on the on websites, that type of stuff."
6:57
And yes, we're going to get the Ubers.
6:58
We're going to get uh you know more and more tech companies that are consumerf facing or business facing and you might see some transformation in legal services, financial services, uh logistics, uh airlines will be using apps to let you book.
7:12
But we're now in the era where the tech companies are starting to vertically integrate so deep that they own the mines and they own the refineries.
7:22
And it's not just that they're actually building uh software for the mining >> technology eating the world. >> Yeah. Yeah. Yeah.
7:30
And it's it's a new layer of uh of vertical integration that sort of just crept up on me because it wasn't an issue until the AI boom really necessitated mass massive industrial scale buildouts, new industrial policy which admittedly can't turn on a dime.
7:50
But we're now two, three years into the chatbt boom, into the AI boom.
7:52
The data center buildouts are getting bigger.
7:56
We're seeing bottlenecks all over the place, whether it's chip shortages or energy shortages.
8:00
And so, you know, the companies like Tesla, AWS, a lot of other folks are are really looking deep into the supply chain all the way into the ground into literally eating the world.
8:11
Uh because I see mining as as sort of terraforming.
8:13
I see it in in some ways as as literally eating the world like you said.
8:17
Uh before we move on, let me tell you about Gusto, the unified platform for payroll benefits and HR built to evolve with modern small and medium-sized businesses.
8:25
So um Amazon's buying the first new copper produced in America in over a decade.
8:34
It's a very exciting project and Tesla now has a Texas facility that can convert raw ore directly into batterygrade lithium hydroxide.
8:41
It's a more efficient process. We can get into that.
8:44
Uh Tesla originally broke ground on this uh lithium refinery operation in May of 2023.
8:49
It feels like they were sort of quiet about it, but now they're getting a lot louder.
8:54
Obviously, the the narrative around China controlling 90% of uh rare earth uh extraction and rare earth elements has been in the news and this is sort of their response.
9:05
Um >> that shot with the cybert truck driving by, >> it's good. It's good. There's a voiceover.
9:10
We should we should watch that video um in in a little bit more detail.
9:14
Can we pull it up with some audio when we have a second?
9:15
So, this facility should refiner is the first spamine to lithium hydroxide refinery in North America.
9:22
We're deploying a new technology platform that is inherently uh much more environmentally friendly and cleaner. It's a simpler process.
9:32
>> It's not that big of a facility.
9:32
And this should be able to create enough lithium for 500,000 vehicles a year, EVs a year, maybe a million a year, I've heard. Now Tesla's shipping 1. 65 million.
9:46
So this won't be 100% but you copy paste this two three times and you got uh enough coverage for all for the entire Tesla fleet.
9:54
>> Take it through a kiln and cooler.
9:54
From there we take it through an alkaline leech and additional purification steps take it into crystallization [music] and produce battery grade lithium hydroxide.
10:05
Our process is more sustainable than traditional methods and eliminates hazardous byproducts [music] and instead produces a co-product named analy used in concrete mixes.
10:17
>> From breaking ground in 2023 to running rot through the kiln in 2024 to start a full integrated plant startup. >> He looks so tired.
10:24
He's just like, >> "Yeah, it's been it's been great working for Elon." Hi. Hi. Uh I love it.
10:28
I >> Yeah, it's been relatively relaxed here at the the site.
10:35
the uh the you know we sleep in the factory in this case it's just dirt but sleeping in the dirt surprisingly comfortable >> construction timeline [music] >> this refinery really enables us to have access to the critical minerals for energy [music] storage for battery manufacturing and ultimately for growth
10:51
>> and it enables us to accelerate Tesla's mission by regionalizing supply chains for battery minerals and materials by providing jobs by cutting emissions from the transportation network that's required for those supply chains it really allows us to usher in energy independence for [music] North America. >> Who would have thought that Texas would
11:07
>> Who would have thought that Texas would be the the home of EV domination. >> I know. Narrative violation.
11:15
>> California really dropped the ball.
11:15
Um so, uh Tesla shipping 1. 65 million.
11:18
That was a little lower than the previous year.
11:23
I think they were up at 1.
11:23
7 million, but you get a couple of those facilities and it should be enough to cover uh everything that they need.
11:27
Um there's also there's been a whole bunch of news around uh rare earth uh minerals generally.
11:34
Last year a company called Iconic or ionic mineral technologies made a large discovery of 16 16 different types of minerals in Utah late last year. This was in December. Um >> as we do. >> Yeah. Yeah. Yeah. It it has been funny.
11:49
There have been rumors about this but uh they found a huge deposit of of uh of all these different uh minerals.
11:54
Um, obviously everyone's worried about China controlling 90% of the supply of rare earths, but uh, we need to actually get these minerals out of the ground, refine them, and so that's where projects like that come into play.
12:07
Uh, Amazon's partnership with Riotinto is a little bit different.
12:11
They're not fully vertically integrated like Tesla is.
12:12
Uh, but they are partnering with Riotinto.
12:17
Um, and, uh, Riotinto had been working on a new method of refinering lowgrade copper deposits.
12:23
copper deposits. So basically like there's a fair amount of copper in the ground but there's a lot of dirt a lot of other stuff that you have to process out that can be very expensive but because of the data center expansion exploding the price of copper has I
12:37
think nearly doubled in the past two years and so uh copper is not the main ingredient to an AI data center a token factory but it is important uh because the biggest data centers use tens of thousands of metric tons of copper to move electricity around so you need wire wires. There's copper in circuit boards.
12:53
There's copper in circuit boards.
12:55
There's wire in the there's copper in the transformers that move electricity around.
12:58
And there's tons of miscellaneous electrical components all over a data center that need copper.
13:01
Uh so this particular AWS Riotinto deal is only 1,400 metric tons over four years.
13:10
I don't even think that's enough for a single AWS data center.
13:12
Um, but it's allowing Riotinto to underwrite this sort of risky new uh process methodology that if it works and they get the price down on this new process, then they can apply that to tons more copper reserves that's locked up in, you know, messy messy ore that otherwise would be uneconomical to refine.
13:36
So uh 70% of the global supply of copper uh is currently locked away in ore that's not economical to refine into actual copper right now.
13:50
So if this new process technology works, you effectively triple the amount of copper.
13:54
You triple the supply and so price should fall. It's doubled.
13:57
You triple the supply, maybe price comes down.
14:01
Uh good news for anyone who's in the copper market uh trying to acquire a >> Riointo. some quick back stories.
14:06
One of the world's oldest uh largest and oldest mining opera uh corporations with a history that spans over 150 years.
14:12
Uh name uh was uh inspired by the Rio Tinto in southwestern Spain.
14:22
>> Uh but uh the uh founding again goes back to the mid 19th century.
14:25
Spanish government was facing financial crisis and they started selling off their older mines.
14:33
Um and so crazy story of just like a very old company, you know, continuing to be a key player in an entirely new tech trend. >> Yeah. Yeah.
14:43
Riotto's been in the news a ton also for lithium ion.
14:45
They do some stuff there.
14:47
They had one uh investment that I think they wrote down, then they spun another one up.
14:50
They've been uh back and forth.
14:52
Uh let's uh tell you about Finn.
14:54
ai, the number one AI agent for customer service.
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15:03
So, uh, X-Freeze broke the Texas lithium ion, uh, lithium refinery down a little bit more.
15:09
It's the first in North America to convert the raw ore into battery grade lithium hydroxide, skipping intermediate steps.
15:15
In the long term, probably more economical.
15:17
It went from groundbreaking to first production in just 19 months, an unheard of timeline at this scale.
15:23
The process is cleaner, no hazardous waste, a useful byproduct that can be turned into concrete.
15:29
Uh, the single refinery can supply lithium for over 500,000 EVs per year and directly challenges China's 60% grip on glo global lithium refining.
15:37
Uh, Elon chimed in and said it sounded like I I saw another number that was maybe closer to a million.
15:44
But either way, you do two or three of these and you're good for Tesla's supply chain.
15:48
At least maybe they sell it to other folks as well.
15:49
Uh, and and what comes out of this will actually be sent to another company and then back to Tesla.
15:54
But they are vertically integrating.
15:55
Um, uh, Chimath Polyhapatia called it, he predicted this.
16:01
He says, "As we predicted in our annual predictions episode at the start of the year, unless someone shows up with superc conductivity or carbon nano tubes, copper is the only game in town and AI is a huge demand driver for a very underresourced material.
16:13
So, he's taking a victory lap with his thesis on copper."
16:18
Uh, pretty pretty good call.
16:20
Pretty cool, uh, that that he has this clip here.
16:23
Um, so in other news, let's tell you about graphite.
16:26
dev code review for the age of AI.
16:29
[applause] Graphite helps teams on GitHub higher quality software faster.
16:33
And speaking of AI, there is turmoil in the trade wars, in the talent wars in >> Barrett is back. >> Barrett is back. Barrett is back.
16:44
>> Uh, so uh, this is from Kylie Robinson over at Core Memory. She says, "Breaking."
16:49
Can we just give it up for Kylie for a second?
16:51
potential scoop athlete of the year. >> Huge.
16:56
>> Putting up some crazy scoops. Crazy scoop.
16:58
>> She had the Anthropic XAI drama last week.
17:03
>> She's on an absolute tear. >> Absolutely.
17:05
>> She's on an absolute tear. >> Yes.
17:07
Uh so she says breaking Thinking Machines has terminated its CTO Barrett Zaf due to unethical conduct.
17:12
According to two sources familiar with the matter, CEO Meera Moratti announced the news that in all hands with employees today, Sumath Chentala will be taking over as CEO and Meera posted as well confirming the news.
17:28
She said, "We have parted ways with Barrett.
17:30
Uh Sum will be taking the new CTO of thinking machines role.
17:32
Uh he is a brilliant and seasoned leader who has made important contributions to the AI field for over a decade and he has been a major contributor to our team.
17:41
We could not be more excited to have him take on this new responsibility.
17:48
>> And uh Alex Heath actually has some new news broke 30 minutes ago.
17:51
He says more Thinking Machine employees are in the process of joining OpenAI >> after three of the startups co-founders >> rejoined yesterday.
18:01
Of course, the Thinking Machine co-founders had previously been at OpenAI.
18:05
Uh but anyways, somewhat of a uh uh not great. Not great.
18:12
Um the I think uh potentially more controversial news was that Thinking Machines has branded uh squat racks at the office. Yes.
18:20
Ryan Peterson posted a photo.
18:24
A lot of people uh a lot of people took this as somewhat of a red flag, right?
18:28
People say, you know, the the sort of common guidance is don't make merch until you're generating some real revenue, right?
18:35
And so if you take that further, it's like maybe you shouldn't have >> What was Ryan doing to get this photo?
18:42
It seems like >> I think he just walked by.
18:43
>> He's going journalist mode here. You see this?
18:46
He's like He's not in >> If you zoom in, you can see these things look fantastic.
18:49
So >> Well Well, Ryan, you're you're outside.
18:53
You're you're outside the thinking machines branded gym. >> Yeah.
18:56
I'm somewhat uh I'm somewhat envious.
18:58
Uh these things look fantastic.
19:01
I'm kind of mad that that we didn't get the branded uh plates.
19:05
Uh but this coming out while losing, you know, half of your family, >> it has to be weird.
19:12
I mean, how how much have they raised?
19:13
It was two billion at 12 billion, something like that.
19:16
I mean, it it's got to be so weird to start a company and on day one have enough money for a custom gym.
19:23
That's just like unheard of.
19:26
unheard of. like you you know like normally you you you start your company in the garage and maybe there's a weight in the corner you can lift or kettle bell >> one dumbbell >> yeah one kettle bell or something but to just come in and say yes we're taking
19:39
class A office on day one uh hiring a massive team uh bringing on six six or seven co-founders >> and Atlas was saying uh like the other red flag is where are the where are the 45 [laughter] I think I think I'm going to assume they're just not in sight you know Like you can't see them, [laughter] right? They would be they would be
19:56
They would be they would be mounted they would be mounted lower. >> Yeah. >> Right on the rack.
20:00
Uh [laughter] but uh >> Alex never change.
20:03
Oh [laughter] >> but uh >> so funny.
20:09
>> But yeah, so so >> so rude.
20:12
>> But in case you forgot, Andrew Tullik left thinking machines in uh uh >> Q4 of last year. Yeah.
20:19
Zuck had been trying to poach him. Yeah.
20:22
And and offered uh increasing amounts of money until uh and andrew I the >> the sense is that Andrew was like, you know, I can't be bought.
20:34
>> But he he needed the money.
20:36
>> He needed he needed he he he had a ch he had a shopping cart filled with chrome hearts supreme.
20:41
And and he [clears throat] was like, "Wow, like my my my next outfit's going to run me 500 mil.
20:49
I I I I gotta get a new job. I can't afford it.
20:51
I can't afford my lifestyle.
20:52
Maybe it was a case of lifestyle inflation.
20:54
They talk about that, you know.
20:55
He's just like, "Okay, I got I got a new I got a new SP3 Daytona now.
21:00
I got the Valkyrie and like >> and they gave me 80 allocation."
21:05
>> I need I need some cash. I got to get a new job.
21:08
It's [laughter] just not It's just not covering the bills over here.
21:12
>> Tyler, do you remember the final amount that Meta paid?
21:13
It was like uh cuz cuz I I always appreciate a lot of rumors.
21:18
like my my in my head it was like Andrew was like yeah like I app I'm really like honored that you would make such a big offer Zuck a billion dollars but like unfortunately like >> I'm very mission align you know I'm I'm mission driven uh there's really no price that I would take to leave the
21:34
company that I started >> and Zuck's like >> two billion [laughter] >> well so I uh I >> I think all the rumors were actually from the summer when there was like the like the all of the talent wars going on um So, first there was I think it was just 1 billion and then there were rumors of three and a half. >> Wow. [laughter] >> Wow.
21:51
[laughter] >> And that being turned down. >> That's a lot.
21:54
>> Uh but then later in the year then he eventually >> when Okay.
21:56
So people kind of assume that the rumor is true because uh because it he eventually made the move. >> Yeah.
22:02
But I mean it's not necessarily higher than three and a half, right?
22:05
Because now we're seeing more people leave.
22:06
Like why are they leaving? >> Yeah. Yeah. Yeah. >> You know.
22:08
So >> it's I mean it's very unclear, right?
22:11
Yeah, I think the the the actual estimate was like something like uh the journal had reported 1 and a.
22:15
5 billion over six years.
22:19
>> I mean there is just some risk to starting a company with six co-founders.
22:23
Like that's just that's just that is unorthodox. >> Unorthodox.
22:26
So some amount of churn >> and they still got John Schulman, right?
22:30
Who's absolute legend co-founder of OpenAI? >> Yeah.
22:33
Like everyone who's still there or everyone who was there like they're all goated and it's like super hard to one of my buddies, he's like super smart.
22:38
He was trying to get a job there. It's like insanely hard.
22:41
You have to be actual goat to work there. >> Okay.
22:44
>> So, but you know, now they're leaving.
22:46
>> It's a bit of a goat patent. >> Yeah. >> Goat farm. [laughter] >> Yeah.
22:50
I mean, Dylan Patel was really excited about this.
22:52
He said, "Uh, can I invest in Mirror's company?" Godamn.
22:54
Two more goats going there back in February 6th of 2025.
22:58
So, a little under a year ago.
23:01
Uh, there everyone's saying Schulman, but the other is as arguable uh just as arguable just as if not more goat.
23:09
[laughter] And David Holes says, "I'm calling it Marotti heavy industries."
23:12
Uh, and >> yeah, I mean, at one point, um, one of my buddies who works at a big lab, he was saying at at that time, Thing Machines has like the best team. >> Yeah.
23:24
>> Like any of the big labs. >> Yeah.
23:25
So, so what, uh, how would you describe what they do?
23:27
Because, uh, we we've heard a number of different, uh, you know, pitches from them, products from them, and some of them seem like >> I, you know, this could easily make a couple billion dollars a year. Uh yes.
23:40
So uh they've shipped a bunch of blog posts, but they also I think I think their only like real product so far has been Tinker.
23:45
>> Um which was basically right. Yeah. An API for fine-tuning. It made it very easy.
23:49
I think it was super good product.
23:51
People who who've used it like really like it. >> Yeah.
23:53
So I mean the general focus been enterprise and chatbt uh everyone at OpenAI has been very obvious like this is the year >> uh this is the year they're focused on this year.
24:05
I think the idea was um like RL environments for specific like businesses. >> Yeah. Yeah.
24:10
So you get a really great fine tune.
24:12
I know obviously OpenAI has a similar business line that probably competes directly but you know being a pure play can work out.
24:18
We've seen what Anthropic's done.
24:20
It didn't seem like a crazy crazy strategy. >> Yeah.
24:23
I mean John Schulman is like one of the OG like main RL guys.
24:25
The team is like perfectly suited for this. >> Yeah.
24:29
So I don't know maybe smaller team more focused um more you know a couple big deals they start finding their footing uh how AGI pilled is uh thinking machines were they on our chart >> I don't think they were right um >> SSI was on the chart of needs AGI is AGI pled I don't thinking machines made the chart I don't know >> how how AGI pilled is thinking machines based on what we Oh >> yeah.
25:00
I mean it's hard to say because it's like okay compared to like the average person they're obviously way more AGI pills [laughter] but but the idea of like doing you're doing RL for business like >> AGI it's like G is general. Yeah.
25:10
>> So if you're just like focusing on specific like business use cases >> that's not very general right.
25:14
You can imagine um someone is just like building the massive model they're just going to everything that's much more like AGI pill.
25:22
>> Is anyone doing AI artificial business intelligence?
25:25
I think that's what we >> Yeah.
25:28
ACI, artificial corporate intelligence, AVI, artificial voice intelligence, 11 labs, build intelligent real time conversational agents, reimagine human technology interaction with with 11 labs.
25:43
>> I think the question is there was already immense amount of pressure and like a really really really high expectations on thinking machines around what they put out first, right?
25:50
I don't think these these people leaving maybe it makes it harder to deliver right on those expectations but the expectations are still >> skyhigh.
25:59
Uh it did feel like uh kind of rough messaging uh very very rough messaging right unclear coming out uh >> uh you know pushing this like unethical conduct angle.
26:14
Uh people at OpenAI have obviously their bias but they've denied it.
26:20
Uh Susan Jang uh who's at Deep Mind said, "Feels like the type of character assassination leak you put out when you find out one of your co-founders might be splitting off."
26:31
>> Uh and Rune says 100% snaky PR move.
26:36
>> Uh so [laughter] >> Signal says there's more drama in AI than the Real Housewives.
26:41
>> Uh that's in the uh in the Wired article.
26:43
Um the quote is a source close thing machines alleged that Zof uh had shared confidential company information with competitors.
26:50
>> So there's like that and then there's the like >> Yeah.
26:52
And like to to me that's just like okay it sounds like he had been like in conversations with open AI.
27:00
>> He could have just been complaining about the lack of 45 pound weights and that is technically confidential. >> Yeah.
27:05
>> He shares it with somebody else.
27:05
They overhear it at a coffee shop and they're like you shared confidential information. >> Yeah. Yeah.
27:11
Yeah, but that that type of allegation is like you guys talked about AI that >> you shared confidential information. >> Yeah.
27:18
>> So anyways, uh >> well the scoop will continue. >> It is played out.
27:23
I'm sure we'll get more >> uh what did Fleeting Bits say?
27:25
Fleeting Bits said some quick thoughts on Barrett Zoff and Mets and Show Holtz.
27:29
Uh going back to OpenAI, Barrett was the vice president of post training at OpenAI before he left for Thinking Machines.
27:35
He left OpenAI in September of 2024.
27:39
Barrett would have probably would have probably initially had options for about 10 to 30% of thinking machines. That's insane.
27:47
They had six co-founders.
27:47
How could that be so high?
27:49
Uh post training was one of the more valuable skills at launch, I suppose. Okay.
27:52
Uh the seed round was 2 billion at 12 billion.
27:54
So this would mean that he would have options now for around 8 to 25% of the current company.
28:00
This seems all uh hypothetical here.
28:02
Uh there were rumors back in November that Thinking Machines was in talks to raise at 50 to 60 billion.
28:07
So this puts his equity at four billion to 15 billion valuation.
28:09
Uh thinking machines could probably exit somewhere at between 30 and 60 today.
28:17
[laughter] Who who has that money? I don't know.
28:20
Maybe Nvidia buys them or something.
28:20
Um at least at some point in the over the next two years.
28:25
I think the most likely acquirers would probably be Microsoft, Apple, Meta, Amazon, and Nvidia. Okay.
28:31
Large cap company that wants to build a frontier model.
28:33
Barrett would have been just over his one-year cliff.
28:34
So assuming he was not fired for cause or thinking he doesn't want to litigate, he still has about one to >> Okay, that part's incorrect. How does that math work? >> I don't know.
28:45
>> Uh one quarter of >> 25% vested. >> Yeah.
28:48
So So one quarter of the equity at a So this person's assuming that that he got 10 to 30% of the company and that the value of the company currently is >> 60 a year.
29:01
over a year and so you're looking at a billion dollars of equity.
29:06
Uh would be interesting to know how his open AI pay package the rumor is that OpenAI set aside about 50 billion for the equity pool for the new PBC so they can afford a decent pay package for him.
29:17
My guess is that it was personality dispute or disagreement over the commercial direction of the company with Mera executive team.
29:22
And if there is something behind the unethical conduct claim, it could just be a game of telephone over him talking to the other labs and mere interpreting it as him disclosing trade secrets. Huh, interesting.
29:35
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29:38
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29:43
Uh, it's called Thinking Machine now because there's only one left.
29:49
No, there are three left. So, it's still plural.
29:51
Rahul, but that's a funny post.
29:53
Nevertheless, [laughter] >> uh yeah, I I [snorts] >> read reading into this, I mean, uh the there's got to be some real excitement on uh that, you know, OpenAI has just been outflows, outflows, outflows >> getting some of these superstars back. Yeah.
30:11
>> On board has got to be good for M.
30:13
>> So, is this what the elves and Valinor do we know what Rune is posting about?
30:18
cuz we learned that Rune posts the elves have left for Valinor every two years apparently. >> Okay.
30:24
Well, he posted it once before. Yeah.
30:25
In um in 2024 about in I think what was it January 22nd. >> Yes. >> So yeah.
30:31
So so now um he posted this like uh on the 12th, so 3 days ago.
30:34
Um >> I think most people have now taken it to mean to be about this, right?
30:40
Uh people leaving thing machines going back to OpenAI.
30:44
Um, but I think there's a couple ways you can look at it, right?
30:47
So, if you look at it in the context of uh of the of the last time he said this, it was the exact same quote the elves had left for Valinor.
30:54
Um, >> like, okay, what is Valinor in Lord of the Rings, right?
30:58
Valenor is where elves go.
31:00
Um, so they don't like diminish or like they don't like kind of fade away. >> Yeah.
31:05
>> Um, >> so it's okay, what does that mean?
31:06
Like maybe it's you're just basically securing like massive wealth, >> right? >> Yes.
31:12
you're not you're not going to be diminished by inflation or something slowly, you know, dying.
31:17
>> Or or the other way to read that is like you go to you go to like a one of these newer labs and you could be a superstar but your your abilities could fade away with time, right?
31:26
Because you just don't have the scale or the resources. Yes. >> Yeah.
31:30
But so so I think in the 2024 context, >> uh Valenor actually was the Neolabs, right?
31:36
Because you can basically go start a company, be the co-founder, you guys raise at 12 billion.
31:42
>> You're just like, let's go.
31:42
Like, yeah, I just secured insane amount like massive bag. >> Yeah.
31:48
>> But then now uh >> now open contact open now Valenor, right?
31:52
They they're they're sending aside 50 billion just for pay packages. >> Sure. Sure. Sure.
31:55
>> If you go back, I mean, you're doing pretty well. >> Another battle.
31:58
>> It's pretty safe, right?
31:58
You don't you don't have this startup, you know, you're not sure if it's going to work or not.
32:03
Um, so it's kind of a circular thing going on. Yeah.
32:07
>> There's other ways you can even read the most recent one, right?
32:08
There's there's like the billionaires leaving California.
32:12
>> Maybe Texas, Miami, that's Valenor. >> Yeah.
32:16
>> Um, you could say the agents are val or the elves.
32:19
And >> maybe maybe Barrett was so afraid of the the billionaire tax act that he's like, I don't want to be a billionaire.
32:25
>> I'd rather I'd rather not be a billionaire than give 5%.
32:29
>> [laughter] >> I just give me a just give me a simple hundred million dollar pay package. >> I'm a humble guy. That's it. >> Yeah.
32:39
>> I don't want to be worried about that. A AGI is coming. >> Yeah.
32:42
The new pay package >> money won't matter.
32:43
>> Should be 999 million.
32:45
>> He's like, I don't I don't want to deal with the headache of, you know, paying out taxes on unrealized cap gains. Yeah. >> I'll be bankrupted. >> Yeah. Yeah. Uh yeah.
32:53
So uh yeah, Rune is is talking about the framing around this.
32:59
Before cognitive restructuring, important people are leaving after cognitive restructuring.
33:02
They're being fired for unethical conduct.
33:04
Uh the uh mom and dad are fighting.
33:07
Uh more thinking machine employees are in the process of joining OpenAI after three of the startup co-founders, all ex Open AI, rejoined yesterday. Three?
33:16
I thought it was only two that rejoined.
33:19
Um but it does seem like >> it's two. They're counting Andrew. Oh, okay. Rejoin.
33:26
But he didn't rejoin open AI, so I don't know if that would count. Little little odd. Yeah.
33:34
>> Anyway, it does it does seem like the talent wars are unending in the AI race.
33:38
Um, >> we got to talk about saunas.
33:39
We got to talk about the sauna wars because they're heating up and Vanity Fair has a piece on it.
33:45
So, before we read this, let me tell you about console.
33:47
Console builds AI agents that automates 70% of IT, HR, and finance support, giving employees instant resolution for access requests.
33:57
As we recess, >> everyone's focused on the AI wars.
33:58
Not enough attention going to the sauna wars.
34:04
The real heated rivalry is at the bath house. >> Yes.
34:08
>> From bath house to other ship to alter.
34:10
A wave of bathous in New York City are popping up just blocks apart. Okay. Igniting a war of zen.
34:15
Uh, [laughter] and this this is especially relevant to the TVPN team because we've been in somewhat of a sauna war ourself, which we'll get into at some point in the story.
34:27
Uh, the Flat Iron District in Manhattan has been a center of Nuvo wellness for around 15 years with its many boutique fitness classes, gyms, acupuncturists, and stretching and recovery centers.
34:38
Now, wave of bathous that offer dry heat and cold plunges face off in a [snorts] few blocks.
34:45
There's Bath House on West 22nd with other ship two blocks away and alter set to open this winter.
34:49
You could walk between all three in mere minutes.
34:53
Williamsburg has its own cluster, right? Parallels.
34:56
>> It's like a super cluster. >> Yeah.
34:58
uh with the original location of Bath House and other ship that followed.
35:03
Welcome to the Sauna Wars where dedicated bathous compete with members clubs like West Villages Continuum which costs 40,000 per year that has a bath house setup and the financial district co-working space WSA's wet lounge as well.
35:18
>> Co-working space with a wet lounge.
35:20
[laughter] Not something >> not something you hear about every day.
35:24
The fitness chain TMPL has a whole subway ad campaign entirely around their bath house facilities featuring women in swimsuits reclining in a suggestive way that one doesn't really find in saunas in real life. >> Very odd.
35:36
>> They joined stalwarts like the Spa 88 and Air in Manhattan, Citywell and World Spa in Brooklyn, Spa Castle in Queens, and of course the Russian and Turkish bass in the East Village, which is the sort of place newcomers are brought to see a slice of the real New York City.
35:51
It's usually teaming with people, some getting whacked by bushels of oak leaves in a treatment called Platza and has two owners who rotate weeks of ownership. That's interesting. It's a funny concept.
36:02
Uh, it's no frrills and even a little gritty.
36:04
For those who are used to conveniences such as booking ahead, there's none of that to be found.
36:07
They do have a nod to modernity with an active Tik Tok account featuring guest endorsements recently highlighting Uma Thurman wrapped in a peshmina and calling it one of the greatest best New York institutions.
36:21
The first time I went to 10th Street Bass was in 2007.
36:23
I love the authenticity and how it made me feel.
36:27
I would find my way back there when I felt depleted, underslept, whatever it might be.
36:31
I would come out feeling great, says James O'Reilly, who is one of the founders of the co-working space.
36:36
His latest project is the new lore bathing club.
36:42
>> This is where you go if you want to cultivate lore in your life.
36:43
Uh I guess founded alongside restaurant tour Adam Eler, Lur takes some inspiration from the Russian and Turkish bath as well as the communal sweat traditions of Europe and Asia and drops it into a 6200 square foot space finished in travertine and white oak in no.
37:02
The bath world is quite a scene.
37:04
One where skincare brands such as Fel Williams, Human Race send out a press release to announce they're temporarily supplying lore locker rooms with their signature 7D gel sets.
37:16
>> What is a 7D gel set, Tyler?
37:16
[laughter] I >> have no idea.
37:21
>> Other Chip is hosting comedy nights.
37:23
Alter will be selling bathing suits that are custom made in Brazil >> and has hired a lighting designer who has worked with Billy Isish.
37:28
So you're always feeling your best and comfortable and tan, Jafari says with a laugh while giving a tour of the space.
37:33
There's already a wait list of more than 500 people for their membership, which will cost $275 per month upfront for $500 worth of credits to be used towards sauna and cold plunge, but also IVs and shots of vitamins, hyperbaric oxygen therapy, red light, NAD, compression, and PEMF.
37:51
Coler has an indoor sauna with a list price of 120,000, an outdoor sauna with a list price of 95,000, and even launched a collaboration with the wellness club Remedy Place for an athome 39°ree ice bath for $20,000.
38:05
Do >> you think Brian Johnson will get into IRL experiences, physical locations?
38:10
I know, was it Dave Aspbury did that for a while?
38:17
There were a series of bulletproof coffees.
38:18
Yeah, there's one that one in Santa Monica >> and and there's been a few uh um like locations where you can go and they have a hyperbaric chamber.
38:27
You can get your uh your blood tested like a variety of uh sort of health and wellness like biohacker hubs.
38:35
Uh some of them >> I think Brian would make a nightclub bath house >> probably >> cuz he he would want to you know his new thing is love as the ultimate longevity hack and so >> could see him doing something like that.
38:51
>> It's such >> it is a sauna boom reminiscent of the glut of boutique fitness studios that flooded the market in the wake of the success of SoulCycle.
38:57
It used to be that you would go to a gym and it was outrageous to go to an expensive group class says Jafari.
39:02
But now there are 99 boutique fitness concepts in a 4m radius.
39:07
Still, there are not as many as the peak days preandemic.
39:09
Not every boutique fitness studio survive, let alone thrive like solid core and Tracy Anderson.
39:16
Competition is always something we are aware of, says Emily Bent, Other Ship's co-founder and director of marketing.
39:21
The saturation in North America for bathous is not even close to what it is in Europe.
39:25
We're starting an industry and rising tides and all that.
39:29
I have uh heard about other ship uh and what a what an insane business uh other ship is um from a number of people.
39:42
Uh so not surprised to hear they're expanding.
39:44
While the message from founders blissed out on 180°ree heat is one of bringing together community and good vibes.
39:50
The reality can be cutthroat.
39:52
Consider the case of Bath House probably the most well-known of the businesses in the second wave of New York City sauna culture.
39:59
co-founders opened their first location in Williamsburg in 2019 and a second in Flat Iron in 2024.
40:05
Both featuring sauna steam rooms, warm pools, and cold plunges.
40:09
Goodman, the founder, saw the company's more approach through the model of working on large event production.
40:14
You think like an experienced designer, so going to Bath House is not a monolithic experience, but more of a choose your own adventure.
40:23
When it first opened, Bath House was jokingly called the Bitcoin bath house as they used the heat generated from mining to [laughter] warm the tubs.
40:29
Uh, which is I' I've been to both of the bath house locations in New York.
40:36
>> Now they need to do LLM inference.
40:38
>> Yes, >> this is a no-brainer.
40:38
Like everyone who was in crypto mining needed to pivot to AI.
40:42
They should just do that.
40:42
They already have all the infrastructure.
40:46
>> This is the solution to the political problem.
40:47
People are mad at at data center power use, but if you have a nice bath house that you can go to for the for the public, >> everyone's at the bath house constantly talking to Claude or something.
40:55
Uh I imagine that uh the water use in a bath house is actually probably pretty significant.
41:00
I imagine that they're like draining the pools fairly often.
41:02
So >> I think I think they're probably draining them less than you would hope.
41:09
>> Oh, [laughter] that's not good.
41:12
>> Uh >> uh >> so anyways, the comments originally were like uh >> there's a bunch of things I want to talk about. First, Crowd Strike. Your business is AI.
41:18
Their business is securing it.
41:19
Crowd Strike secures AI and stops breaches.
41:22
Second, we have a key question.
41:24
Do you know who Uma Thurman is? >> No. [laughter] >> Kill Bill.
41:29
You've never seen Kill Bill Tarantino. It's fantastic.
41:33
>> Oh, I I Yeah, I I >> brutal. >> Also, Pulp Fiction. I've seen Pulp Fiction.
41:38
Um, anyways, the comments were like, "Oh, they're laundering money through bitcoins, but it's just a fancy pool heater.
41:45
Those jabs did not prepare them for what happened earlier this year when someone posted on Reddit Reddit, I noticed the hot tub and body temp tub were looking kind of dirty and gross.
41:53
I thought I'd be fine, >> but then I ended up with a UTI." >> Mhm. >> Uh, not great.
41:59
A UTI doesn't just walk across the river.
42:02
If it was a problem, it would be a pool at a single location at one given day.
42:06
There's 24-hour computer monitoring.
42:08
So, I'm glad that the uh Bitcoin heated pools are getting 24-hour monitoring, and they're manually logged five times per day. And we keep the logs.
42:18
We are adjusting pH and chlorine at all times.
42:22
>> Every drop of water at every pool turns over every 30 minutes.
42:24
All the vessels have their own independent system so they don't mix.
42:28
>> The water goes through a sand filter that takes out any particles up to two microns, like a receipt in their pocket or a tag that falls off. >> Interesting.
42:35
Uh then it goes through a UV filter, big tank with three foot long light bulbs, a pure UV light. So >> they're sterile.
42:42
>> They're going pretty hard. >> Cool. >> Uh >> well, vibe.
42:45
co where DTOC brands, B TOC, startups, and AI companies advertise on streaming TV, pick channels, target audiences, and measure sales just like on Meta.
42:54
Um anyway, speaking of Meta, we got to talk about Meta because they just laid off 1500 people in their Metaverse division. It's 10% of their staff.
43:02
it affect affects the company's AI glasses and other wearable products.
43:07
Uh the stock is up on the news.
43:09
Um obviously 1500 people is a ton. That's a lot of people.
43:16
Uh but they still have 14,000 people working on uh reality labs.
43:18
So there's a question about like what exactly will they be doing?
43:23
How much does this represent a shift?
43:24
They're you know the messaging has certainly shifted to augmented reality instead of virtual reality.
43:30
But it feels like they will be uh continuing with a lot of stuff.
43:32
The the Wall Street Journal has a report here in December.
43:35
Uh Meta was the journal reported that planning that Meta was planning to make budget cuts to teams working on the metaverse.
43:41
Um we uh met a spokes meta spokesperson said uh we said last month that we were shifting some of our investment from metaverse towards wearables.
43:51
towards wearables. Um this is part of that effort and yeah you you see the the the reality labs team work on a bunch of different stuff and uh it started as sort of you know the Oculus acquisition a VR headset then all of a sudden it was Meta Raybands which is you know mostly
44:09
just a camera certainly not a VR headset uh but has it feels like it's sold many more units I actually don't know the the precise number >> I'm super curious how uh how many of those 1500 people will end up working in VR are as in their next >> somewhere else. >> Yeah. It's just like can the can the >> Yeah.
44:24
It's just like can the can the industry really >> absorb that >> absorb that many people, right? >> I don't know.
44:31
I mean, there's projects at Google and Samsung and Apple Vision Pro, obviously, and then there's a couple startups, but yeah, where do you go?
44:38
I mean, I imagine that a lot of those people are just broad technologists and can work on anything because they're probably working on on servers or supply chain or purchasing or marketing.
44:47
Like, there's so much to do within Reality Labs.
44:49
It's a massive organization.
44:50
I mean, they ran like huge TV campaigns for the for the Oculus and they will probably continue to um with the Quest.
44:58
Uh a year after the name change and pivot, the journal reported that the company's flagship metaverse product called Horizon Worlds was failing to catch on with users.
45:04
It had less than 200,000 monthly active users, and most so-called worlds were never visited by anyone at all.
45:12
The company's presentations attempting to stoke enthusiasm for Horizon Worlds provided fodder for popular mocking internet memes.
45:20
People were making fun of it.
45:20
Um, yeah, the Horizon Worlds product.
45:24
>> I still believe Meta is a fantastic name >> for Meta. >> Yeah.
45:28
Do you think Salesforce should rename?
45:30
I wanted to ask Benny off that yesterday >> if he's ever just going to go force. >> Metal Force. >> Force.
45:35
Metal Force would be a good name.
45:37
But yeah, I mean, he is moving past sales.
45:38
He talks about agent force and service force and all the different groups he has.
45:41
Uh maybe he's got to change a name at some point. It' be fun.
45:45
But Salesforce is kind of a Lindy name.
45:46
It's been around for so long.
45:47
>> Who has the ticker AI? >> Uh C3 or something. I don't know.
45:50
Meta has been ramping up uh AI spending on AI, pushing its capital expenditure to 72 billion last year with plans to accelerate that spending this year.
46:00
It's also doled out offers worth tens of millions uh tens and hundreds of millions of dollars to AI researchers and engineers and recently acquired a Singapore-based AI startup called Manis for more than two billion.
46:11
The company's Ray-B band smart glasses equipped with AI have also started to take off.
46:14
The company sold more than 2 million pairs and has delayed the roll out of its newest glasses in Europe as it struggled to keep up with demand in the US.
46:24
uh 2 million pairs of smart glasses, the the Ray-B band metas versus 200,000 monthly active users in Horizon Worlds.
46:34
I wonder what the retention is on on Rayban Meta Ray-B bands because if they're retaining less than 10% then you the actual MAU pool is is lower. >> Yeah.
46:45
But it starts I see people >> and >> I've started to see Instagram reels of people using the the smart glasses >> really >> to to do uh first person videos and often prank videos.
46:55
So I think that there's actually a flywheel there that's stronger than what's happening in in VR. >> The only Yeah.
47:01
The thing that's uh interesting about not focusing on Europe Yeah.
47:06
is that my initial reaction of using the Rayban Metas was >> if I was using WhatsApp as my primary messaging app.
47:16
>> Yeah, >> these would be like way more interesting, right?
47:19
Because you have the integration, you have the heads up display, you can get messages, you can read them, you can respond to them.
47:26
>> Uh it's it's super super integrated.
47:28
meanwhile, they don't have an iMessage integration and so they're not that valuable to me from a messaging standpoint, which is like kind of one of the key use cases. >> Yeah.
47:39
>> Yeah. Uh the the the sort of Ben Thompson takeaway from this was that uh even though Mark Zuckerberg has you effectively complete control over Meta and can uh rename the company and move very aggressively and acquire big companies uh at the end of the day he
47:55
does respond to shareholders and the shareholders have been watching the reality labs losses pile up billions every year and at some point if you have a new sort of big you know money pit initiative that's AI and you're going to spend tens of billions there. Uh you
48:10
Uh you have to sort of make a sacrifice or at least like show the shareholders that you're uh refocusing on the new thing.
48:21
Even though obviously AI and VR play very well together, part of the biggest problem with VR is that it's very difficult to develop.
48:28
You have to develop this full game.
48:29
AI can enable a lot of that speed up development.
48:31
And then there's also the uh the the sort of longer offtake.
48:36
uh maybe not that far in the future, but this idea that if you generate a world model like the FA Lee World Labs project or Google has a project as well, uh Genie, uh that might be something that actually gets you to put on the headset because it's infinite and endless and and requires a whole bunch of upfront cost to train the model, but then once you put it on, you're just in that and you can prompt it yourself.
49:00
You're kind of designing your own game and that's a unique experience that it seems uniquely suitable for VR.
49:05
Um >> Ben Thompson's take was that uh the uh Meta Vibes was like a virtual reality project effectively even though you didn't put a put a glasses on. It was created.
49:19
>> Well, that's been my take on the name.
49:20
It is like >> it's still a metaverse. >> It is a metaverse.
49:23
It just looks like a suite of apps. >> Yes. Yes. Yes.
49:26
And now you access that you access that metaverse through a screen.
49:30
And whe how how close that screen is to your face might take years to get closer and it might be small when it's when it's close for the for the for the first uh first iteration.
49:39
Um I'm very interested to see how the uh the Ray-B band displays are selling.
49:44
2 million Ray-B band smart glasses.
49:46
Um I've seen them sell the Ray-B band displays at Best Buy.
49:52
Um, and Sheil Mona was talking about sort of his his frustrations getting onboarded.
49:58
Uh, I haven't se I have I have you run into anyone wearing them in the wild.
50:02
I've run into people with the RayBan uh smart glasses all the time with the with the with the cameras on them, but I haven't run into any >> the new ones the display.
50:10
Yeah, I I haven't I haven't seen anyone just rocking them even though they are out.
50:15
>> I honestly I feel like we don't see that many people.
50:17
[laughter] >> I never go outside.
50:21
>> Well, I mean we on the on the weekends I do, but I'm like out out and about.
50:28
But uh I wanted to go back to the thing.
50:30
I didn't get a chance to give a take.
50:34
>> Uh I am >> uh extremely bullish on Americans starting to sweat more because it the the evidence is like so clear >> that if you use this on every day, Yeah.
50:46
>> you will probably extend your health span, lifespan.
50:48
It's heavily heavily studied just be studied because of how popular it's been in the Nordics for like decades and decades.
50:53
Uh so very bullish on sweating.
50:56
Uh one of the things that's interesting though is that uh New York is is uh has like you know New York is like the center of consumption right people have tiny apartments so they're just constantly consuming right food uh you know exercise uh shopping etc.
51:12
Uh, but I don't think it's representative of the way that the Americans will like sweat broadly because you can get a sauna for like a couple grand and so all these bathous are like a few hundred and so I think for some people they want the social experience whereas for me I don't like the I'm not really like that into the like the >> You don't like talking in the sauna?
51:36
>> I do like talking in the sauna.
51:36
We've obviously had our sauna wars, our sona wars [laughter] or uh I guess we were talking too loudly in the sauna the other day cuz this guy just absolutely uh absolutely snapped.
51:46
I I I was he was a bit of an angry elf.
51:49
Um [laughter] but uh but but the anyways like the most most consumers are going to be looking like I can go and buy a sauna for $2,000 >> and I have space for it because I have a twocar garage and a backyard and maybe a pool and like for the average American that has a little bit.
52:07
>> Last time I lived in an apartment, this was like >> uh six or so years ago, I had a whole cold plunge that I snuck into my apartment [laughter] and a sauna just I had a two-bedroom loft. >> You had a sauna, too? No. No, I had two.
52:21
So, I had a twobedroom >> I had a two-bedroom loft and and one of them I just put a it was just like cold plunge on a wooden floor. >> That's insane. >> And I had a sauna.
52:30
>> Of course, the I don't think you're allowed to bring like a mini swimming pool into if it leaks, you're going to destroy the whole >> I actually I did they did eventually tell me I had to get rid of it because there was a leak in the building and they went in to look and they were like it didn't have anything to do with my mold plunge or whatever. >> But um >> Okay.
52:46
So, if you were if you were talking to Brian Johnson, you would say, "Skip the physical institution that is the sauna.
52:52
Start a line of saunas that can be delivered on a truck to to to homes." >> Yeah, maybe.
53:00
I mean, that that's a there's there's a company called Plunge that scaled insanely quickly.
53:06
I think over nine figures of revenue off the cold plunge boom.
53:08
the cold plunge boom. But uh yeah, the main thing you have to understand is you you know for other ship in these companies like you have to go I think into dense areas where people don't have a lot of space to have saunas because a
53:19
lot of people are going to look and say I either have one in my gym >> or >> I can you know people can go and just even if they don't have the two grand you can use a firm and like you're effectively paying a couple hundred bucks a month for for like a private experience. >> Uh we'll see we'll see. Uh
53:34
>> Uh we'll see we'll see.
53:34
Uh >> Gabe says, "The big sweat lobby is making moves." >> I like it.
53:40
>> Uh but yeah, I just the I've I've remained so bullish on this trend because it's just passive, right?
53:44
You don't you don't have to like work up like the motivation to sweat in a car, right?
53:51
So you get a lot of the benefits of exercise, but you're not like I got to force myself to go for a run.
53:55
It's just like get in the box. >> Get in the box. >> The label box. [laughter] >> Yeah.
54:00
Let's tell you about label box.
54:05
Label Box, delivering you the highest quality data for Frontier AI. Get in the box. >> Get in the box. >> Label Box.
54:11
Maybe Label Box should do a drop of of custom saunas for everyone.
54:15
>> Daniel Gross says, "I am building out Meta's comput desk.
54:17
I'm looking for folks with a background. >> I like the term desk.
54:22
>> It feels like New York. It feels like finance. It's not just a team. It's a desk." >> Yeah.
54:27
deep learning, supply chain, commodities, semiconductor, stacking copper, >> so energy, Excel, prediction markets, monitoring situations, etc. >> This is amazing.
54:37
>> Canada should have experience in at least one of these domains.
54:39
Somebody's like, I I've monitored a lot of situations. I'm I'm qualified here.
54:46
[laughter] Uh, and novel ideas on how to apply LLM to their work.
54:48
If you'd like to help manage 100 billion of compute spend, please DM and include information about why you're a fit.
54:54
If you're in doubt, if you're in doubt about being a good fit, please apply.
55:00
>> Yeah, at least at least one of these domains. I only know Excel.
55:02
I don't know anything about any of the others.
55:03
I'm just an Excel jockey. Uh good luck.
55:06
Uh but yeah, I mean massive compute spend.
55:11
Very interesting to see where the the the MetaMPP compute project goes.
55:14
Obviously, they're spending a ton.
55:14
Um the uh uh the Mark Zuckerberg said, "Today we're establishing a new top level initiative called MetaMP.
55:22
Met is planning to build tens of gigawatts this decade.
55:26
Hundreds of gigawatts or more over time.
55:28
How we engineer, invest and partner to build this infrastructure will become a strategic advantage.
55:32
It's led by uh Daniel Gross of course uh and Santosh will continue to lead the technical arch architecture software stack silicon program developer productivity and building and operating the global data center fleet and network.
55:47
Daniel will lead a new group responsible for long-term capacity strategy, supplier partnerships, industry analysis, planning, and business modeling.
55:54
They'll work closely with Dena Powell McCormack, who just joined Meta as president and vice chairman to work on partnering with governments and sovereigns to build Dipoy to invest in and finance Meta's infrastructure.
56:06
I'm looking forward to working closely with Daniel Santosh, Dena, and their teams to scale MetaMP compute. It's a good name.
56:12
You need a name for a team.
56:13
Uh what did Ben Thompson have to say about this?
56:15
He said, "A narrative seems to be quickly spinning up that this signal that Meta is finally going to get into cloud computing, competing with Amazon, Microsoft, and Google."
56:25
And well, Ben Thompson, he doesn't really think that's going to happen.
56:29
What exactly would be the point?
56:31
Amazon invented the space and invested heavily to have a structural cost advantage in commodity compute.
56:38
Microsoft had a natural customer base with enterprise.
56:40
Google has differentiated infrastructure and an outlet to fully leverage their AI investments without fear of cannibalization.
56:47
What exactly would Meta bring to the table that other hyperscalers do not have such that they would have the confidence that they could be anything other than second choice competing on nothing but price.
57:01
So asking the the hard questions about where meta compute goes.
57:03
Um they don't need to sell it if they if they truly scale.
57:08
scale. They've been what I mean didn't wasn't their compute budget in the preAI era tens of billions of dollars in capex and that was just for you know reels just for ads like there's plenty to do >> if they don't if they don't choose to sell it anyway MongoDB choose a database built for flexibility and scale with
57:25
best-in-class embedding models and rerankers MongoDB has what you need to build what's next >> we have the CEO of coming on in just 5 minutes uh in other news Beijing has told Chinese firms to stop using CrowdStrike if you didn't have a re if you didn't have a reason to start using Crowd Strike. This is a pretty good
57:43
This is a pretty good >> Is this the TVPN effect?
57:44
They they saw they saw us run a couple ads over in Beijing and they were like, >> "Yeah, they're too powerful. >> Too powerful. >> They're too powerful. Homegrown."
57:54
>> Apparently, uh this is already very tiny business for Crowd Strike, so not super impactful.
57:57
But uh in other news, uh OpenAI's number one hater [laughter] in the entire world.
58:04
Nick >> is back on the timeline.
58:08
>> Uh he was the hater OpenAI hater of the year last year.
58:11
>> He's probably he's really gunning for it again this year.
58:14
>> His camera roll is all just pictures of Sam.
58:18
>> It's all his camera roll is just all Sam Alman photos for sure.
58:20
Um, but the news OpenAI Broadcom uh AI chip delayed >> and Tio says this is not a delay.
58:27
It's clearly a 5D chess move where Sam is amassing enough time to release state-of-the-art GPT6 and put in Google Anthropic out of business.
58:35
Everyone's having fun >> trying to find >> with the news >> trying to find where this was actually reported. >> Yeah.
58:43
Well, Sam Alman also uh is uh putting uh together there's an announcement from Ashley Vance about uh OpenAI and Sam Alman backing a new bold take on fusing humans and machines. It's called merge labs.
58:58
We've heard about this before.
58:58
We talked to Rob Taves uh on the show about uh BCI and brain computer interfaces potentially being a big trend for this year.
59:07
Obviously, Neurolink has been cooking for a number of years.
59:09
Sam Alman also his has his bet with Merge Labs and uh they now have uh $252 million in the bank and an allstar allstar crew and superpowers.
59:22
>> Uh and remember Sam Alman wrote in 2017 a piece called the merge I'll read and a short a few paragraphs from it.
59:28
He said more important than that unless we destroy ourselves first superhuman AI is going to happen.
59:34
Genetic enhancement is going to happen.
59:36
Brain machine interfaces are going to happen.
59:37
It is a failure of human imagination and human arrogance to assume that we will never build things smarter than ourselves.
59:43
Uh the merge can take a lot of forms.
59:46
We could plug electrodes into our brains or we could all just become really close friends with a chatbot.
59:54
>> But I think a merge is probably our best case scenario of two different species both want the same thing and only one can have it in this case to be the dominant species on the planet and beyond.
1:00:02
They're going to have a conflict.
1:00:03
Imagine if dolphins Imagine if Beni off has been working with the dolphins to secretly help them merge and they're like in a in a crazy dolphin human race to see who can merge first >> because sent dolphins basically >> dolphins can just like generate B2B SAS product ideas constantly. So funny.
1:00:22
X has this this new thing that uh repeatedly >> AI always uh >> is very good at being funny unintentionally, but uh a bunch of people were posting about Beni off story yesterday uh talking about uh and so summarized it as a headline.
1:00:39
Mark Beni off recounts dolphin vision behind Salesforce's start. >> Dolphin vision. I love it. >> Dolphin vision.
1:00:47
>> Sam has some crazy old posts.
1:00:47
I was looking at this one from February 15, 2023.
1:00:51
says, "In 2023, it's $30,000 to get a simple iPhone app created and $300 for a plumbing job.
1:00:57
I wonder what those relative prices will look like in 2028."
1:01:03
Uh, the likely coming divergence between changes to cognitive work and changes to physical work could be quite dramatic.
1:01:10
And I mean, I saw Nick was showing us an iPhone app that cost about $100 of credits or something like that, maybe a little bit less in a vibe coding app.
1:01:16
uh you know, you're going to use credits to inference a model that can actually build an iPhone app, but we're definitely closer to 300 bucks than 30,000 at this point.
1:01:26
Um it's uh yeah, remarkable.
1:01:30
Uh Sentry Century shows developers what's broken and helps them fix it fast.
1:01:34
That's why 150,000 organizations use it to keep their apps working.
1:01:40
Well, we have our first guest of the show, CJ from MongoDB in the Restream waiting room.
1:01:45
We won't keep him waiting any longer.
1:01:47
Thank you so much for taking the time. >> What a set. >> Jump on the show. How are you doing?
1:01:54
>> I am doing fantastic, man.
1:01:54
It's like there are >> 700 people here. San Francisco is back.
1:02:00
I feel like San Francisco is backing and we are re reintroducing MongoDB in San Francisco today.
1:02:07
So, Phils, the energy is just amazing. >> Fantastic. Uh, congratulations.
1:02:10
Take us through some of the announcements.
1:02:12
What does it mean to reintroduce MongoDB?
1:02:13
Uh what are the misconceptions where people might think of it as one thing and now you need to reintroduce it?
1:02:22
>> I would say you know MongoDB first of all database market >> has been around for a long time 50 plus years maybe 60 years.
1:02:31
>> Oracle is going to celebrate its 50th anniversary >> year and a half.
1:02:35
That was my first job out of college is I joined Oracle. Yeah.
1:02:39
>> And MongoDB >> was a truly disruptive database that got created >> in 2007 and in New York City.
1:02:45
I mean this is a one of the few tech companies that got created in New York City >> and put it on the map. >> I know. I know.
1:02:56
And then the leaf you know people ask me what is the leaf of MongoDB all about?
1:03:01
M >> and the founder said, "Hey, this is a natural way a software engineer or a builder should interact with a database versus a rigid way of interacting with database." So, it's pretty cool.
1:03:13
I just became CEO couple of months ago.
1:03:16
Uh came from Cloudflare and I'm having great time meeting innovators, customers around the world.
1:03:25
on the misconception here's what I would say >> that even though the database was created in 2007 the whole idea behind it was speed agility and dealing with a lot of unstructured data like emails [clears throat] PDFs images log files this and that so when the founder created this database it was not with AI in mind and today when you look at any AI application your favorite uh consumer application you may be using on a daily basis.
1:03:58
You see there is a images in there.
1:04:00
You may have create a video in there. Lots of interaction.
1:04:02
This database was created >> for the AI wave and we want builders building on MongoDB as they create agentic AI applications or any applications for that matter that has structured data so that they can move fast and hopefully create the big iconic businesses legendary businesses in Silicon Valley on top of MongoDB.
1:04:26
Where are you seeing the most uh excitement and growth in your business?
1:04:32
Uh I can imagine that there's a ton of green field projects that are happening in large clients, large enterprises where they want to move even faster.
1:04:43
So they're grabbing MongoDB in addition to other modern tools on a new green field project.
1:04:50
And then there's also a new startup boom of AI enabled software companies.
1:04:55
Uh I'm sure that's growing as well.
1:04:57
Uh what have you been seeing?
1:05:00
Where's uptake the fastest in the last few years?
1:05:04
>> I would say John, you know what I learned and I can feel it right here on the floor is that you had pretty much customers.
1:05:15
We have 60,000 customers. Okay. 62,500.
1:05:19
>> And our >> That's fantastic.
1:05:24
>> And our customer growth Yeah.
1:05:24
has accelerated in last 12 months which is pretty cool because lot of developers are now building on MongoDB. >> Yeah. >> Nice. I like it.
1:05:35
>> Every time you say something great I'm going to I'm going to hit that. So fair warning. >> All right. I love it.
1:05:38
So one is our customer base reacelerated as developers are building on MongoDB.
1:05:44
But it's a tale of two cities right?
1:05:47
One is large enterprises John as you called out they are growing still with MongoDB.
1:05:52
They have some mission critical across every industry.
1:05:55
financials, healthcare, government, I can tell you many across the globe just building on MongoDB.
1:05:59
And you have AI native companies or digital native companies whether they are in San Francisco, Seattle, Tel Aviv or even New York.
1:06:14
>> They are building on MongoDB.
1:06:14
So the customer growth is coming from them.
1:06:16
And customer growth accelerated in last 12 months for us which is really cool.
1:06:21
many many companies, you know, when they start deselling, they do not reacelerate and we reacelerate it.
1:06:28
So that gets me like really fired up and really positive and the innovation that we announced today that if you want to truly build an agentic system at scale that doesn't hallucinate you can build it on your laptop.
1:06:43
You always require a great database.
1:06:46
You need an awesome agentic rag or you know semantic search that just works that is accurate.
1:06:51
And this is truly a mission critical app that an insurance company may float it to their customers or a government may float it to their citizens or whatever the case might be.
1:07:03
We want to make sure that this is a great data platform.
1:07:06
So we announced voice for embeddings.
1:07:10
>> Uh we created a small embedding model called nano which is 1/8 the size of large.
1:07:15
M it shares the embedding space and works with pretty much on cloud onrem multicloud and you know Jensen talked about at CES the whole thing around multicloud multimodal and multimodels and we do the same so very cool excited we gave that message this morning uh to the builders here we have a full show all day today which was also live and people are fired up >> how are you thinking about uh M&A this year.
1:07:46
Obviously, the company's doing really well. You're public company.
1:07:47
You have a public currency for acquisition.
1:07:52
Uh there's a lot of different pieces in the landscape that could be synergistic, but uh what's your thought process for uh partnering with uh other startups either uh in a full acquisition or another partnership?
1:08:08
How are you thinking about it this year?
1:08:10
>> So, John, John, I'm a big believer in organic growth. Mhm.
1:08:15
>> I like we have a large market that we participate in.
1:08:18
>> We have only penetrated 2 and a half% of that market.
1:08:20
100 billion we are at 2 and a half billion.
1:08:23
>> So we have a lot of room with our core data platform. Wow.
1:08:26
>> Now we are always looking >> for specialized skills say maybe in the AI area.
1:08:32
So in 2025 we bought Voyage which was created out of Stanford.
1:08:35
Uh amazing uh people you know the founder teaches a legendary course on machine learning.
1:08:43
So we bought that company and he got amazing amazing engineers and researchers and that professor is now chief AI scientist at MongoDB.
1:08:50
So we will do those type of acquisitions where they are small uh either for a technology or people or sometimes both >> so that we can truly leverage and accelerate the pace of innovation.
1:09:05
>> Uh has anything in the uh the various compute bottlenecks been a headache or kept you up at night?
1:09:11
I mean, we're reading about Amazon Web Services is paying for copper refining because they need to go so deep in the supply chain that they need to go to the mining level.
1:09:22
Uh memory prices are through the roof.
1:09:25
Uh there's delays on all sorts of custom silicon chips.
1:09:28
Uh I know uh you might not be affected, but how are you thinking about the uh the the the different bottlenecks in the cloud computing uh supply chain?
1:09:42
I would say the bottlenecks if you remember a couple of years ago everybody was worried about will they get enough GPUs from Jensen.
1:09:50
Everybody's like, "Oh my god, bro.
1:09:52
Are you going to get enough GPUs from Jensen?" Yeah.
1:09:54
And uh that was like a big worry. Yeah.
1:09:58
>> And now when we speak to customers, >> that's why they are like okay will GCP or Amazon like you said AWS and others will they have enough capacity?
1:10:07
will they have enough capacity? right now it is not something that people are panicking and Amazon or Google I would say they're trying to stay ahead on that curve so that it doesn't become that hey CJ we cannot run MongoDB for your favorite customer X because we are out of capacity man we just can't do that so
1:10:28
we are trying to definitely uh work with them understand how they are dealing with both compute as in CPUs as well as GPUs and those innovation cycles are also very asked, but right now we are relying on them to solve, but we are not worried about it because they haven't given us the signal that we won't be able to do this. >> Well, congratulations on the event.
1:10:47
>> Well, congratulations on the event.
1:10:49
Jord, do you have anything else?
1:10:50
>> And and and the new and the new role.
1:10:50
I I know I know we're out of time, but uh I'm I'm sure >> I'd love to dig more into your background and and tell the fuller story.
1:10:58
Uh but we know you have a busy day today.
1:10:59
Congratulations and we will talk to you soon.
1:11:02
>> Give our best to everybody at the event.
1:11:04
>> Thank you, Jordy and John. Appreciate it.
1:11:06
>> Have a great rest of your day. Goodbye. Cheers.
1:11:09
>> Um, Lambda, Lambda is the super intelligence cloud building AI supercomputers for training and inference that scale from one GPU to hundreds of thousands.
1:11:18
Uh, we have Matthew Prince from Cloudflare joining in just a few minutes.
1:11:23
Uh, in the meantime, we will go back to the timeline.
1:11:27
There is some massive news. >> I did on on merge.
1:11:29
I wanted to say a couple things.
1:11:31
So uh male who's one of the co-founders emerged says TLDDR we are developing a new paradigm for BCI using molecules instead of electrodes. >> Oh interesting.
1:11:43
>> Uh if you're excited about this and want to contribute in protein engineering synthetic bio delivery immunology ultrasound devices neuroscience or data MLAI we'd love to hear from you.
1:11:52
So, uh, >> that sounds extremely sucky.
1:11:58
>> Merge is, uh, pursuing ways to make BCI much higher bandwidth, millions of neurons, and less invasive, no device implants.
1:12:05
>> Instead of electrodes, we're focusing on modalities like ultrasound that can cover large areas of the brain >> and on proteins that can connect these modalities with neural activities.
1:12:15
>> Uh, and so again, uh, different, uh, quite a different approach than Neuralink.
1:12:20
Well, let me tell you about Turbo Puffer.
1:12:22
Serverless vector and full text search built from first principles on object storage, 10x cheaper and extremely scalable.
1:12:29
Uh, our next guest, Matthew Prince, is in the reream waiting room.
1:12:33
Let's bring him in to the TVPL Ultradome.
1:12:36
>> Matthew, good to see you again. Happy New Year. How are you doing? >> Good. How are you? >> That's good to hear.
1:12:42
It seemed like you weren't doing that well a week ago when you uh posted about a court in Italy fining you.
1:12:49
Can you take us through the process? Was was this a surprise?
1:12:52
Um how did how did everything uh lead up to your post which went mega viral?
1:13:01
>> Yeah, first of all, not a court uh quasi governmental organization and and let me give you a little bit of background.
1:13:05
So um in Italy uh there was concern uh by a bunch of the uh football clubs, so the soccer clubs in Italy about um online piracy of of the matches uh that were there.
1:13:19
And in response to that, the Italian parliament uh basically designated a quasi governmental organization called AICOM uh that they would have uh the ability to essentially allow any media company executive to put any website they didn't like on a list >> and then initially just the ISPs in Italy had 30 minutes to block access to that website.
1:13:44
But they've been amended the law to be able to include other companies including Cloudflare but also folks like Amazon, Google, Microsoft, anyone that is doing anything uh that is cloud uh related.
1:13:55
Uh they they have gotten swept up in this.
1:13:58
And so the requirement uh was that when a website was put on this list that we would have 30 minutes to remove it globally.
1:14:04
In other words, this small group of media executives got to choose what you could watch in the United States.
1:14:12
uh and we already saw significant uh exposure of this beyond just uh illegal streaming where we saw political content being removed.
1:14:22
They accidentally blocked all of Google Drive at one point.
1:14:24
They accidentally blocked all of Cloudflare's network at one point which broke the Italian internet.
1:14:29
So they turned that off uh pretty [laughter] quickly.
1:14:30
And so we had been in litigation in Italy uh to um to basically say this doesn't make any sense.
1:14:39
And what particularly doesn't make sense is we hate the illegal streamers. They cost us money.
1:14:43
We don't make any money off of them.
1:14:44
They waste our bandwidth.
1:14:46
They they take up resources that we could have for paying customers.
1:14:50
And so we have a huge team that is is trying to shut them down.
1:14:52
We actually won a court decision >> uh right before Christmas uh that said um that we could get all of the internal documents on how this commission was created, what its rules were, everything else.
1:15:07
And um and then, you know, probably just coincidentally, of course, uh immediately after Christmas, the first meeting they had, they imposed a $17 million fine on on us and said that it will continue to escalate if we don't pay it and register for this scheme and commit to let them censor censor the internet, which obviously uh we're not going to do.
1:15:26
That, by the way, is 2x our revenue in Italy.
1:15:30
uh they have interpreted the law as saying that they can charge up to 2% of global revenue for any company that they find.
1:15:40
So again, >> the insanity here is is pretty pretty high.
1:15:46
>> Uh and uh and and yet that's not even what the law says.
1:15:48
The law the law simply says it can be from um you know tens of thousands and in fact there's parts of the law that they relied on that are so old that they were actually quoted in LRA.
1:15:58
So it was back before even the EU existed.
1:16:00
To give you some sense of how crazy this is, even the EU, >> yeah, >> has said uh that this law has has sign they have significant concerns over this law.
1:16:11
And so um we're we're in a we're in a we're in a strange situation where, you know, we're getting a lot of pressure to to literally just turn Italy off and not let them connect to Cloudflare's network, which would, you know, unfortunately everyone saw a few months ago when we had an outage how big of a an issue that is. Yeah.
1:16:28
>> Um, that doesn't seem right.
1:16:32
>> You know, putting your tinfoil hat on.
1:16:34
What is, is there some Do you think there's some local group that wants your Italy business that says like, "Hey, that's like it purely own goal."
1:16:47
own goal." I think there's I think that there is um so I think first of all it's a bunch of you know older um you know football uh owners >> who don't understand how the internet is works who who just are saying you know piracy is a problem and instead of doing what most of the leagues around the rest of the world do with us which is work
1:17:07
with us in order to identify what those illegal streams are and then we not only take them down but we actually put up a page that's an advertisement for the for the the correct stream in its place uh instead They were just like, you know, we're we're we're going to just, you know, be be be we're going to just make it so that you have to take these things offline. Damn the consequences. I think Damn the consequences.
1:17:24
I think there are other people inside of Italy that see this as an ability for them to be able to control some political content uh that they may not like.
1:17:33
Um obviously Italy is a a contentious political uh state and being able to shut things you don't like off the internet is is a very powerful political tool.
1:17:43
So I think that's the that's the tinfoil hat hat side.
1:17:44
But I think mostly this is just thuggish behavior by a bunch of people who don't understand how the internet >> uh Ben take off the tinfoil hat, put on the steel man helmet.
1:17:54
the steel man helmet. uh and try and uh steal man for me the the where the work should be done of fighting piracy on the internet because uh I have some empathy for a league owner who doesn't want their you know content streamed illegally >> and it seems to be like such a hard
1:18:13
problem like like my view is like UFC kind of just like threw in the towel and was like this is the the pay-per-view model is over we have we're going to Paramount Paramount yeah and so uh yeah I it it seems like it's a nice thing for you to do to take down these illegal streams. Maybe there's some legal reason
1:18:29
Maybe there's some legal reason that that falls on you.
1:18:33
>> It's a purely it's a financial reason.
1:18:35
It's like when the when the streams come up, they they clog our pipes and that shuts down the ability and we have to pay for that bandwidth. Yeah.
1:18:41
So, we have all the financial incentives to shut it down.
1:18:45
It is a hard problem, right?
1:18:47
Because again, the streamers are clever and they're always bouncing around and doing different things.
1:18:50
But we shut down hundreds of thousands of illegal streams every single day and we work with most of the leagues around the world.
1:18:57
So there doesn't need to be a law in order to create the incentives for us.
1:19:00
What I do worry about though is anytime that you create some sort of rule in the name of privacy, in the name of protecting children, in the name of whatever that lets a local government and whether that's a you know state government or a or or a or or a or a nation state be able to set how global infrastructure works.
1:19:20
That just seems per se bad, right?
1:19:22
You shouldn't have be able to say Italy decides what you can see and watch in New York or California or Texas or Canada or China frankly and China shouldn't be able to impact like let China be crazy inside of China and they can have their own rules and regulate their networks however they want.
1:19:38
But the the fact that this has extr territorial application that that literally some again Italian basically soccer club owners can dictate what content you watch in California or New York.
1:19:50
That's insane and that's something that we have to push back against. >> Yeah.
1:19:54
So, what's the response been like uh in Washington, in DC?
1:19:56
Uh I imagine that at some point, even just a passing statement from the admin, hey, Italy, back down on this.
1:20:06
We'll, you know, buy a little bit more wine or something, some trade deal, some >> or not or not impose a 100% tariff on all your good that too. Uh yeah.
1:20:14
What What are the levers that people are considering pulling? what has been pulled?
1:20:20
How are the how are the discussions going? Yeah.
1:20:22
So I spent um the beginning part of this week in DC meeting with everyone from uh senators to um the United States state department the white number of different uh officials within the in the in the administration directly in the white house uh USR which is the United States trade representatives and and I didn't come across a single one that wasn't disgusted by this policy.
1:20:44
And so like I don't think the Italians quite understand the hornets nest that they've stirred up.
1:20:50
This is this is now sort of the cause celeb for Europe Europe using US tech companies as their piggy bank where I mean the crazy stat is that Europe makes more off finding US tech companies than they do off taxing their own technology companies. That's insane, right?
1:21:11
And so something has to change here.
1:21:14
And this is the most clear example that again, you know, whi whistles to all the dogs in Washington right now saying like we can't have again Europeans, let alone, you know, this sort of Italian cabal being able to dictate what is and is not online. >> Yeah.
1:21:32
What's the reaction been from uh I mean your competitors, there are other content delivery networks, other hosts.
1:21:38
uh do they agree with you and they're just less outspoken because they're not in the founder mode that you're in perhaps or are there some uh some other companies that are just less affected or less targeted because they aren't as much of a peer play like h how how are how's the rest of the ecosystem reacting to all this?
1:21:58
>> Yeah, I think the hyperscalers are really concerned about this.
1:21:59
I think anybody who has, you know, a a um a really large business where they have, you know, millions and millions, we have tens of millions of customers.
1:22:07
You know, I think what's unique about us is we have a free version of our service because we believe that every small business, every um you know, developer should be able to have robust cyber security tools, robust content delivery tools.
1:22:23
And so that that gives us a much broader portfolio than some of our competitors that only have, you know, you they won't even pick up the phone for less than a million dollars.
1:22:30
Like that that's a diff so it's a we it's a little bit of a different thing.
1:22:34
But if you're an AWS, if you're a Google cloud, if you're Microsoft Azure, if you're an Oracle, like they are deeply concerned that this is going to impact them because they all have broad sets of customers and it's very difficult for them to, you know, just say we're going to let Italy pick who can and cannot be a customer of ours.
1:22:52
That's again just insane.
1:22:54
>> Okay, last question on the fine for me and then I want to move on to AI.
1:22:55
Uh, since we have you here, uh, what what's the result of the fine?
1:22:59
Did you just pay it or are you debating it? >> No, no, no.
1:23:02
So, we're we're we're challenging it.
1:23:04
Italian law because it's because it's Italy doesn't have any any mechanism to stay this.
1:23:08
I would imagine that there are going to be um some some pretty uh pointed phone calls from senior US officials uh to senior Italian officials saying like cut this out.
1:23:17
In addition, you know, we we're considering various options.
1:23:22
So, we may shut down our free service uh in Italy, which again is unfortunate.
1:23:26
It'll hurt a bunch of developers there, but we can't we can't do charity for places that again earn rent.
1:23:33
>> The other thing >> the other thing that's coming up is the Milan Cortina Olympics uh where we provide tens of millions of dollars of free cyber security services.
1:23:40
Um, I I was actually a personal guest of the former president of the IOC to the Paris games because we provided the information that took the terrorist attack that almost shut down the games and allowed them to arrest 90% of the terrorists beforehand.
1:23:53
We helped stop massive denial of service attacks again for free uh that were launched from from Russia which is trying to completely discredit the Olympics because of the doping scandals and and fans that they've that they've faced.
1:24:05
And so um you know again I I really believe in the Olympics.
1:24:10
I really want the Olympics to succeed.
1:24:12
Um, but again, it seems wrong for us to be providing tens of millions of dollars of free cyber security for a for a for a showcase event in a country that's just acting completely insane.
1:24:24
>> Yeah, that makes a ton of sense.
1:24:24
Um, uh, talk to me about the 2026 app innovation report.
1:24:29
Tech, talk to me about this idea of a technical glass ceiling.
1:24:31
Uh, I've been going back and forth with a lot of the AI researchers that come on the show. The models are amazing.
1:24:37
And then I'll ask them like, well, this particular app doesn't seem to be getting better on my phone.
1:24:42
What's going on over there?
1:24:44
Why isn't this app uh significantly improved?
1:24:47
Why are there still bugs in enterprise software when everyone has access to frontier models?
1:24:55
Uh what are you seeing in AI adoption?
1:24:57
What are you feeling internally?
1:24:57
Just take me through your current thinking.
1:25:00
>> Well, we're we are incredibly bullish in AI. We use it internally.
1:25:03
We use it across all of our our teams.
1:25:04
We actually had our companywide kickoff uh today and our CTO challenged every one of our teams to say how can they use AI more and it's it's really quite incredible uh what what it's done.
1:25:15
What I will say though is we're we're definitely in some places for some AI companies hitting some sort of a limit uh it seems in what they're able to do.
1:25:24
And the exception to that um I I think has been Google.
1:25:26
Um Gemini has continued to outperform uh the rest of the market.
1:25:31
And um and and and I think that the answer to why that's the case is is actually not about the chips.
1:25:37
Obviously they've designed their own um you know GPU chips.
1:25:39
Um I I don't think it's about the people.
1:25:42
They have incredibly smart people but so does Anthropic. So does OpenAI.
1:25:45
I think it's actually about the data and we are one of the few companies that actually has a view into this and so we haven't shared this very publicly but I guess you know no time like the present.
1:25:55
Uh, and so how much more of the web would you guess that Google sees and is able to train their AI systems on versus Open AI?
1:26:09
>> Yeah, I would probably say 50% more.
1:26:12
>> Yeah, the answer is actually 3. 2 times more. >> Wow.
1:26:16
>> Which is insane, right?
1:26:16
That means that for every one page that OpenAI say is, Google is seeing, you know, 3. 2 pages.
1:26:24
So there's just so much more data that's going into it and and again open the next closest.
1:26:28
After that, Microsoft sees Google sees 4.
1:26:32
8 times more of the web than Microsoft.
1:26:35
They see similar to what they see with Anthropic as well.
1:26:37
And it just drops off from there.
1:26:40
And so what I worry about is that because Google has this unique access to the web that nobody else has. Yeah.
1:26:47
That the game might just go to them.
1:26:49
Because I think that at the end of the day, whoever has the most data wins in the era of AI.
1:26:53
And I think what a lot of these companies are seeing is they're hitting kind of a data limitation.
1:26:59
And one of the things we're really thinking about is how can we make sure that we level the playing field?
1:27:04
Either bring Google back to where everyone else is.
1:27:06
Don't let them leverage search in order to get a unique advantage in AI or how do we lift everyone else up to the same place where Google is.
1:27:14
Make sure that everybody has access to that same data.
1:27:16
If we don't create a level playing field in terms of the data, I do feel like there's a real concern that Google is going to run away with this and no one else will catch them. >> Interesting.
1:27:25
Yeah, we've noticed that.
1:27:25
I mean, we test all the different uh LLM apps and uh even just from a branding perspective, when you're in the Gemini app and it and it says doing a Google search, all the other apps will say we're searching the internet, but doing a Google search just gives it the brand is like, oh, it's it's doing what I would do if I were on the computer.
1:27:42
and that uh and and it's interesting to hear that there's actually more data being accessed. It's not just the brand.
1:27:50
>> That's also the one of the only things that Elon and Sam can really agree on or sort of [laughter] a shared shared motivation is like making sure the AI race is competitive with >> Google.
1:27:59
I mean people people forget that open AI was started because Elon and Sam got together because they were so concerned about what was happening with with Google.
1:28:06
And I think that that concern is rightly placed and Google has such a data advantage where because of search, everyone has let them behind their payw wall.
1:28:15
Everyone has let them see parts of the internet that no one else sees.
1:28:18
Again, we we can look at the the the restrictions on various spots.
1:28:23
What are the robot txt files and everything else for a huge portion of the internet?
1:28:27
And the answer is that Google just has privileged access.
1:28:28
And until we until we level that playing field either by bringing Google back to the same level as everyone else or bringing everyone else up to the same level as Google, like I worry that that this is their their race to win. And and that's bad.
1:28:42
Like the world shouldn't certainly shouldn't have one AI company.
1:28:46
I don't think you should have five AI companies.
1:28:47
I think we should be playing for a world where we have 500,000 AI companies and we make it as easy as possible for any of them to thrive and survive. >> Okay.
1:28:55
Talk to me about the defaults in uh on robots.
1:28:59
txt where people are allowing scrapers where uh Googlebot can come in where Gemini can come in.
1:29:06
Uh what have what's been your thinking on defaults?
1:29:08
What how has it evolved and then what's the reaction from your customer base been to those defaults? Yeah.
1:29:14
So, I think the this is a this is is is actually a really nuanced issue and the answer is going to be different for a number of different um companies and in some cases we don't know what the right default is.
1:29:26
So, here here's here's where I think it's the things that are very straightforward. >> Excuse me.
1:29:33
Um if you have a knowledge base, so Cloudflare has a knowledge base on you know how to use Cloudflare workers in order to build build systems.
1:29:42
[clears throat] >> Excuse me. Tickle in my throat. >> No problem.
1:29:44
Um, if you have something like that, then that's then of course you want that to be an AI systems and that should be default scrape no matter what. >> Yeah.
1:29:52
On the other hand, if you're a publisher, which is ad or subscription supported, >> maybe you don't want that to be in because AI bots don't click on ads.
1:30:00
And if they're taking all the content that you're generating and then just regurgitating it in a place where you don't get any benefit from that, that that's a real problem for the business model of of media companies.
1:30:12
And again, I think what we're seeing is the media companies have really locked down who has access to their content.
1:30:19
And you're seeing much better deals from the likes of Comedy, NAS, Dot D-mmered, Reddit, who are getting more for their content from the AI companies because at the end of the day, whoever has the most data is going to be the winner that's there.
1:30:31
What I think is somewhat unfair, and again, back to the same issue, is Google because of search is still getting almost everything for free whereas everyone else is having to pay for it. That seems wrong.
1:30:41
That seems like something that we need to fix in some way.
1:30:44
And again, that either we need to either bring everyone else up or bring Google back down to everyone else's level.
1:30:49
But that's that's one of the things we're worried about.
1:30:50
I think the most interesting thing that people aren't talking about today is what's going to happen to retail.
1:30:55
What's going to happen to small businesses that are out there?
1:30:58
AI is this massively consolidating force.
1:31:00
And if you look at take three of the biggest retailers in the world, Walmart, Target, and Amazon.
1:31:09
What's interesting is again these these are hugely well-resourced companies, smart people working at them.
1:31:13
smart people working at them. no lack of of you know financial resources across across them to do whatever is right and they have come to three completely different conclusions on what you should do about a aentic commerce >> in the case of Walmart throw the doors
1:31:28
open to the catalog let every agent in and in the short term I think that's clearly the right answer >> um but I worry over time that the agents are going to just keep trying to figure out how can we cut Walmart out over time and I don't know what brands mean in a world where you know your agent is shopping on your behalf. Brands are a
1:31:48
Brands are a way for humans to have shortcuts that understand quality and value that goes away in a world of agented commerce.
1:31:57
Agents will figure that out for you and report back and brands might not matter as much.
1:32:02
And including a massive brand like Walmart, Amazon is taking the complete opposite strategy.
1:32:06
They're literally suing Perplexity saying your agents aren't welcome here.
1:32:12
>> Again, two But but that's because they have a massive advertising business and they know that the agents aren't >> Well, so is Walmart. >> Sure. >> Yeah.
1:32:20
But it's not how how material is it for Walmart versus >> it's a pretty big like all all I mean there's any of those sponsored listings on Walmart and they're all doing the same stuff.
1:32:30
I think I think I would I would argue it's something different.
1:32:32
I think Amazon thinks that they have to win the agent war themselves and so Alexa has to get much better at it whereas Walmart doesn't have as much of a stake in this.
1:32:41
So, this is a giant bet, I think, from Amazon that their agent will be able to shop better than anyone else's.
1:32:47
Um, that isn't my experience with Alexa yet, but again, a huge amount of resources that are going into that.
1:32:53
Target has what I think is sort of the, oh, let's split the baby um kind of approach, which is agents are allowed, but they have to be the ones that are listed on the Target website.
1:33:02
That obviously is not going to be a long-term sustainable approach, but but I think that that shows how challenging this is going to be.
1:33:08
And what I really worry about is going forward, like if you think about what small businesses that you shop with, your local butcher, your local, you know, flower store, those things, a lot of it is because of the interpersonal relationships with that you have with those shop owners.
1:33:23
>> If those go away, if your agent is doing this all on your behalf, if we all become some version of the Jetsons, where you know what does how does George do his shopping?
1:33:30
He asked Rosie, the helpful robot, to go do it for him, >> and eggs show up and he doesn't really care, you know, where they came from.
1:33:36
I worry that that's going to put enormous pressure on small businesses and I don't know that small businesses have the tools today to be able to figure out how to exist and thrive in this world of agentic commerce and that's something that I'm enormously worried about.
1:33:50
>> Jordy, >> I think yeah, I think it's I think it's warranted.
1:33:52
I I I still think at the end of the day with physical products it's like you know I care a lot about like I'm I'm drinking this here.
1:33:57
I'm drinking this because our friend Andrew Huberman, this is the brand that he's aligned with.
1:34:03
Like if I just sent an agent to go buy me a Yerba Mate, maybe it comes back with something else, but then I'm still like, "Ah, just get me the get me the get me the [laughter] get me the podcast in a can, please."
1:34:14
Uh, anyway, so a lot a lot to figure out.
1:34:17
I the the exciting thing I feel like is that every uh so many different companies are reporting that LLM traffic is converting at a high rate, which tells me that it is a great tool for product research.
1:34:28
But >> yeah, >> there is a lot there is a lot of questions of like yeah, how do you >> uh you know, geo is kind of like a dark art right now.
1:34:37
It's very hard to under it's it's far easier to kind of understand how you're showing up in in results than it is to maybe influence it yet.
1:34:47
>> Um a lot of things to figure out.
1:34:47
I did have one I I wanted an update on the ski season from you.
1:34:52
uh uh we we I saw numbers, you know, tra basically traffic down like 20% year-over-year >> probably. >> Yeah.
1:35:01
So, so the so so one one thing before like I I agree we don't quite know how this is going to play out, but I do think it's important that we articulate what we're trying to play for.
1:35:11
So I want to play for a world where there's not five AI companies, there's 500,000, where there's not, you know, a small set of media, you know, massive conglomerates, but anyone can be a content creator.
1:35:22
I mean, you guys are a perfect example of what I want to make sure continues to exist as we get into a world that is more AIdriven.
1:35:28
And then for businesses, we need to make sure that you can be a small business and still thrive.
1:35:34
That there is a way to have a level playing field and that there can be tens of millions of businesses around the world that can actually do that.
1:35:40
And that's that's what we're thinking about.
1:35:42
That's what we're partnering with folks like Visa and Mastercard, American Express, PayPal, you know, Shopify, Adobe, Salesforce to try and figure out how do we give those tools.
1:35:50
And I think that's the one of the most important questions.
1:35:52
The business model of the internet over the next 5 years is going to change radically.
1:35:56
Rarely does that something, you know, that big have that big a change.
1:35:58
And I think if you're not thinking about what that change is going to be, uh then uh then then again, I I I don't think you're worrying about the most important question today in terms of the ski season.
1:36:08
[clears throat] No reason the skiing should be distracting you from thinking about what the future business model of the internet should be. It is grim.
1:36:13
I'm sitting [laughter] in I'm sitting in Park City, Utah.
1:36:17
It is the worst ski season.
1:36:19
I mean, I'm 51 years old.
1:36:19
My first year of skiing, I was the 76 77 season.
1:36:24
This is as bad as that season.
1:36:27
Um, I I'm >> No, it's good timing for you.
1:36:28
Like a lot of people, you know, pray for snow.
1:36:30
You were kind of like a bad ski season is kind of convenient for you right now.
1:36:35
You need to be pretty locked in.
1:36:37
>> I am for for I'm trying to get Veil to sell me uh Park City uh and then return it to local ownership and and make it the star that it is. And I think >> Yeah.
1:36:47
So, so Veil is trading at less than less than two times revenue.
1:36:49
Uh, we've covered kind of the history of the business.
1:36:55
Uh, like at what point do you just like just buy the whole buy the whole thing?
1:37:01
>> I don't think it makes sense.
1:37:01
I don't want to run Veil.
1:37:02
Uh, that doesn't sound like much fun, but I think somebody should.
1:37:06
And you know, if it's, you know, if you could if you could acquire Veil for, you know, $5 billion, uh, with with some leverage and you need about a billion dollars of equity, I I know a guy who will who will write you if you're an activist investor on >> That's what I was saying.
1:37:19
One way you get your your prize uh, you know, your trophy, Park City, is you just buy veil and then you spin it out spin out Park City yourself and >> Yeah, that that seems maybe we'll get to that point.
1:37:30
I would much rather somebody else who's like good at those things that goes again like a you know Elliot management if they want to go buy Veil and then sell me Park City.
1:37:37
That would be it's it seems like an almost it's getting close to being a no-brainer. >> Amazing.
1:37:42
Well well well we're hoping to follow that story.
1:37:44
Thank you so much for coming on the show.
1:37:46
Good luck with the >> good luck with the Italians and thank you for all the support coming on the show early. It's been huge. >> How's your Italian?
1:37:54
>> My Italian is is is not not particularly good.
1:37:56
So >> he has a great Italian lawyer.
1:37:57
I bet I bet he's got a guy who's over there.
1:38:01
>> A [laughter] lot of lot of good employers. Full employment.
1:38:04
Uh well, have a great rest of your day.
1:38:06
Enjoy the rest of your day and we'll see you soon. Appreciate it. Big fan. >> Goodbye. Thank you. >> Shopify.
1:38:12
Shopify is the commerce platform that grows with your business and lets you sell in seconds online, in store, on mobile, on social, on marketplaces, and now with AI agents.
1:38:23
Delian >> Delian Asperu the co-founder of Varda the partner at Founders Fund.
1:38:29
Hit him with a flashbang. [laughter] Got him.
1:38:36
>> We got to hit him with a smoke grenade, too.
1:38:38
Ask him to do an intro as the smoke clears. Throwing smoke. >> Throwing smoke.
1:38:43
[laughter] >> And look who is it. It's Deli.
1:38:47
As the smoke clears, we have the partner from Founders Fund on the stream.
1:38:51
It really takes a second to clear. Okay. Okay. We're clear. We're clear.
1:38:55
Delian, good to have you here. Hope you're doing well.
1:38:59
Thanks for hopping on the show. How are you doing? How's your week going? You're ripping checks. You're in business. Money's flowing. >> Is it Yeah.
1:39:06
Is the bare market Is the bare market over?
1:39:08
I mean, end and you know, last year you you kind of uh you felt like things were getting a little crazy.
1:39:14
Maybe you you didn't you you didn't find any opportunities you love.
1:39:19
Then you started the year with a bang. >> Mhm.
1:39:22
>> Started the year with a bang.
1:39:22
I feel like, you know, I I I think I'm just like um addicted to investing over the holidays.
1:39:27
I realized over the past like nine years that I've been in venture, I think seven of those years I've signed a term sheet within 48 hours of Christmas Day.
1:39:34
Um and I don't know if that like speaks to the fact that like I just like I'm addicted to work or something about like Santa Claus makes me want to like send out some presents or something like that.
1:39:42
But yeah, it definitely feels like a busy season.
1:39:44
I was catching up with another investor and he was like, "Same thing here."
1:39:47
Like one of the you best deals we did was basically over Christmas.
1:39:50
>> Is the deal flow from like serendipity at the holiday parties or is it just networking from the internet?
1:39:54
Like where are you meeting founders these days?
1:39:58
>> I admit that like I think a part of it is um if if you were trying to preempt around no better time than to do it over the holidays cuz like nobody's cher chatting at the office.
1:40:06
There's no like hallway conversations etc.
1:40:08
you can have these just like very quiet conversations.
1:40:11
Founders like it because they don't have to deal with like, you know, a bunch of noise.
1:40:14
You like it because you feel like you can do this like one-on-one negotiation and basically just set the deadline of like, you know, I've now done this a couple years in a row where it's like, yeah, signed by New Year's otherwise like deals off basically.
1:40:22
And it feels harder to enforce that type of deadline like during the like, you know, school year basically.
1:40:28
And so, um, I think that's part of why, you know, on both sides I like it.
1:40:31
It's like as a founder, you can kind of test the waters and if it gets shot down, whatever. Nobody heard about it.
1:40:35
Everybody's gone for the holidays.
1:40:36
you come back into the office, your employees don't know, your board doesn't know, no VCs know, and if it does go, then like, you know, great.
1:40:42
>> I think I think it's convenient as a as a founder, the holidays can be so annoying because like it becomes like kind of poor form to just be like, you know, slamming people, your team with emails around Christmas Eve, Christmas, >> slamming the VCs with >> and uh yeah, so I I think it's a win-win.
1:41:00
just obviously anytime you're talking terms it becomes wildly distracting cuz you're like this is maybe the most important thing >> uh for my business right now but if you can use that stretch of like 7 days where you're not really supposed to be like you know uh >> you're not operating but you're allowed to negotiate terms.
1:41:16
By the way, I did want to point out I did make sure that I wore my uh TVPN quarter zip today.
1:41:19
So this is how I have a you have a horse on that.
1:41:24
Is that a little horse there?
1:41:24
We got another [laughter] horse there. Let me get it. Oh, other way.
1:41:28
Other way into the sunshine. >> It's coming on.
1:41:30
It's coming on the screen. >> Wow.
1:41:33
[laughter] >> You guys have a hole so you guys can >> Oh, yeah. Yeah.
1:41:38
2026 is a good year for us.
1:41:40
We're uh talk to us about the biodal strategy, early stage, growth stage.
1:41:43
Um is is this is this actually pushing you out on the barbell?
1:41:50
Was series A your sweet spot and now it's seed and series C?
1:41:53
Is this going to be a permanent thing?
1:41:55
How are you thinking through that?
1:41:56
that? Yeah, I think if you look at some of the best like um deep tech hardware industrial you know sort of companies over the past like 15 years they have a very interesting like PPS you know sort of growth curve where effectively you have like typically a seed round that happens and I'm just going to give like you know somewhat fake numbers here but
1:42:12
you know indicative of like you know a buck per share basically the like early incubation days >> you [clears throat] then have like series A that'll be like four or five times higher basically like five bucks a share and then a lot of times what you'll see is years of super dimminimous basically PPS growth until you sort of get to the other side of like the R&D production hell, etc. And then all of a
1:42:27
And then all of a sudden, you just have huge step function changes like over and over and over again.
1:42:32
And this is true on everything from like the early days of like Nvidia, Tesla, like you know, Apple all the way down to like some of the more, you know, sort of recent, you know, sort of more, you know, deep tech industrial, you know, sort of startups.
1:42:42
>> And so what to do as like an investor basically?
1:42:45
Well, you know, you can, you know, I think do the seed rounds where I do think they're, you know, attractive versus reward.
1:42:52
You get some amount of IR just like through series A, etc.
1:42:53
And then what you effectively want to do is do that last round where it's flat and then allow it to basically you know basically grow you know from there.
1:43:02
>> And I think what I've like started to realize is like that is the style of company that I like to do.
1:43:05
It has a very different PPS curve relative to like SAS AI etc which are honestly just like much more like you know clear smooth sort of like you know typically obviously exponential curves if it's like a you know sort of great company right like if you look at ramp for example there was just clear step ups all throughout.
1:43:20
obviously had the like, you know, they did a great job of like, you know, marking themselves down in like the 23, you know, 2022 basically, you know, sort of crash and I think that was proven to them and then basically smoothly upwards basically since then.
1:43:31
>> Um, and so the the the the way that's played out is like, you know, now over the past couple years, I've much more consistently done basically like super early stage PDF and a founder basically like, you know, early early, you know, industrial deep tech companies.
1:43:42
And then I sort of sit there and b my time and wait until what I think is like that basically last round right before the inflection point and then basically you know sort of do do that round.
1:43:50
And I've now done that you know over the past year I did basically three like later stage basically rounds like you know series B series C and then like you know basically series C that I just you know closed terms on over the holidays.
1:44:02
Um and all of them were companies that I've either been tracking basically since seed or literally been an investor since seed.
1:44:08
And we talk about one of those you know part of what we were talking about earlier today was you know talking about one of those very particular companies.
1:44:13
Um, but yeah, I think I'm starting to realize that I like that women more than I like doing the like, you know, sort of messy middle um, in some ways.
1:44:18
And so, yeah, want to double down on that and, you know, whatever Tuesday night was cool where I literally felt that happen where I signed two term sheets that were indicative of both ends of the barbell for me.
1:44:27
>> What was the amount of work in DD that you did on the series C company significantly higher?
1:44:32
Um, like how did you actually split the time up?
1:44:35
because this is framed as uh you know 50/50 of Delian's time but uh I imagine that there's just more data to pull in more research to do more customers to talk >> but at the same time you know the company so much better. >> Sure. Sure. Yeah.
1:44:46
So what was it like process-wise? >> Yeah.
1:44:49
I mean I'm not somebody I don't think I would ever be able to do like a raw series where it's like I've met the company for the first time have the time to go do the diligence etc from scratch cuz it's just like dude I've got a company that I got to run like I can't do that.
1:45:00
The thing that I can do though is like get involved early or if it's something I'm like deeply passionate about even if I'm not involved like track the company super regularly such that I'm kind of doing all that pre-diligence basically like ahead of time.
1:45:11
So like let's talk about one of the you know some companies that I think exemplifies this strategy where we just announced a $ 1.
1:45:15
we just announced a $ 1.6 6 billion post round led by Tro Price basically last week that I got maybe um you know >> we're going to have the show we'll go ring it twice for the hey >> exactly exactly I think it's Dallas you know fifth unicorn or something like
1:45:31
that from like you know they see under 25 post all the way through to the >> Yeah feel good about it Chris said I was texting him earlier he's like you're allowed to to your own horn I want to do BC brags you know hit me up >> um >> yeah we give us the update on on on hatred. >> Yeah, that's one where like look I got
1:45:49
>> Yeah, that's one where like look I got involved in the you know basically like company formation basically like you know seed round where it was Chris and like maybe one or two you know sort of people >> and so what did diligence on that one look like?
1:45:59
Well it was effectively like you know four and a half years of working with Chris very closely going to every single board meeting watching the company like adapt over time and in like you know Q1 last year in 25 it was clear there was just like this inflection point that I felt like I could appreciate but not everyone else was really appreciating yet.
1:46:14
The first was they basically, you know, for those that don't know, HRE basically builds these like automated CNC basically, you know, facilities.
1:46:21
They basically cut metal on behalf of, you know, aerospace and defense companies.
1:46:24
So, you know, think a lot of the biggest logos in the Founders Fund portfolio.
1:46:27
I won't list, you know, sort of all of them since I'm not sure which ones are allowed to be public, but, you know, ones that, you know, build rockets, make drones, you can guess which ones those are.
1:46:34
>> Um, and they cut metal on behalf of those companies.
1:46:36
those companies. For a long time they were interested in the like R&D production grind like trying to figure out basically like how to make the economics of the business work you know switching from like what were originally quick turn small prototype contracts into like production multi-year you know
1:46:50
basically large contracts and in Q1 last year there were two things that happened that just like made it very clear to me that it hit like my spidey instincts of like oh this is like the point that I'm supposed to come in and do the series seed like my whole job was to have done the seed and then wait for this exact moment. The two things that happened
1:47:04
moment. The two things that happened were one they just got through production hell basically like the economics started making sense they were producing you know it's going to be way more volume and then the second thing was you know um we talked about this a lot but the defense industry is obviously going through a huge shakeup
1:47:17
and there's a whole set of you know neopimes that are coming out that are going to get anointed and Hrien was clearly in this transition point from what was previously just purely like a backend sort of supplier of you know sort of parts and a vendor into uh somebody that was becoming more of like a strategic you know neop prime there's
1:47:34
going to be co- betting alongside others but as a neoprime that is focused specifically on production right so if we think about groups like you know analic shield AI um you know name your favorite basically you know you know you know mock industries name all your favorite you know neopsimes they all roughly follow the same model which is
1:47:52
like they are product developers fundamentally right like they go and like design net new products they may do a decent amount of production and assembly of themselves but they still are reliant on like out of you know sort of house you know sort of vendors for a vast majority of their like you know subcomponents. Yeah,
1:48:05
Yeah, >> Adrian fundamentally is a very different type of neoprime, right?
1:48:08
They are neopre that is explicitly focused on production.
1:48:10
They do not produce basically like end products themselves.
1:48:13
They only amplify others's end products.
1:48:16
But that is a significant bottleneck that the you know defense you know department or you know war department is looking to go unlock and is leaning on a Hrien for a wide variety of you know programs both directly you know as Hrien as a contractor as well as like co- biders alongside other neoprimes.
1:48:28
And so I think when I think about like you know the way that Adrian was interpreted Q1 Q2 last year people were squinting at they're like man these economics have only turned in the last quarter.
1:48:36
Um you know isn't this just a backend vendor that doesn't have a ton of upside.
1:48:39
From my like insider perspective having watched it for 5 years I'm like dude this is the type of business where once the economics turn a corner they don't unturn a corner. You know what I mean?
1:48:48
It only gets easier from here.
1:48:48
We finally got to positive.
1:48:49
we're going to 20% margin, 40% margin, 60% margin, and it's like, you know, accumulating advantages, but like materials get easier, the factories get easier, and the states want to send the stuff.
1:48:59
It's just like, you know, you're rocking and rolling.
1:49:00
But like when people look at like a SAS business, they don't appreciate that like Yeah.
1:49:03
in like hardware, especially when you're producing something that is like kind of a commodity.
1:49:07
There's sort of like semi-infinite demand.
1:49:08
There's like not semi-infinite demand for data bricks, you know what I mean?
1:49:12
Like, you know, just doesn't the scale of the market is not nearly as large.
1:49:15
Um, and Ollie would put your truth [laughter] in on that. >> Thanks a difference. >> Hey, sorry.
1:49:21
We're obviously investors.
1:49:24
>> Hey, also Tro is Tro Price is smart enough to be in both data bricks and [laughter] you know, to be clear, big data bricks fan, but at the end of the day, the amount we spend on metal is more than I probably really know what data bricks does, but [laughter] like whatever they do, the amount that we spend on metal is more than whatever we spend on data.
1:49:43
Well, well, I mean, reflect on the on the AI boom, the slop versus steel debate.
1:49:48
It felt like uh AI went through this sort of reset on the narrative towards the back half of last year.
1:49:55
>> Do you have room in your office for a victory lap or are you kind of [laughter] >> um but but it feels like it feels like we're back to back to normal.
1:50:02
I mean, there's there's multiple 10 billion deals announced already this year.
1:50:08
Nvidia is acquiring stuff for 20 billion, something like that.
1:50:11
Uh it it feels like the pace is is just continuing unabated.
1:50:15
There's no real reset there.
1:50:16
Um how how did you process like the bubble in venture that discourse?
1:50:21
Where where do you feel like we are now?
1:50:23
Where do you think uh about the new like fundraising landscape the K-shaped dynamic between the large funds smaller funds?
1:50:31
Like what's your what's your current outlook on the venture capital market broadly?
1:50:36
Yeah, I mean it's interesting where like um you know I won't name names but there's like various venture firms that you know have had like uh funds that they have like half funded done really great deals out of and some of these like you know top tier names have significant markups even on those investments and still aren't able to like fully close out the fund.
1:50:53
like fully close out the fund. So it's like as an LP you're able to like you know basically get in immediately know that you're like you know LP position is going to be marked up and a part of it is that you're comparing it that versus like there's so many of these mega you know sort of labs mega rounds where there are so many SPVS that are
1:51:09
available that as an LP you're actually trading that against well I can just go get the direct position no fees or much more dimminimous fees through like an SPV from like a lesser manager and so you are seeing like you know um if you look at like you know I think there's this like you know a graph recently that
1:51:23
was just showing like you total um uh venture dollars raised by venture firms significantly like it's still linearly basically down since 2122 and that was you know shown I think it was like on Carter or something like that they were showing basically that data >> but I would bet if you looked at like total LP dollars deployed into like tech
1:51:41
venture you know direct you know sort of investments fund investments etc it is almost certainly significantly up since 2021 it's just like >> Mubata at some point can access some of these mega rounds just as easily as they can access like directly into, you know, basically like some of the funds that they used to have to, you know, invest into. And so you're getting this odd
1:51:56
And so you're getting this odd dynamic where, you know, I think we talked about this, you even last week a bit, but like a lot of people are doing these like fearless, careless SPVS that are basically like branding exercises for them.
1:52:06
>> Um, so yeah, I think it's like it's a harder time than ever to be an emerging manager.
1:52:12
Like you there's somebody that like I forget who did this analysis, but it's like it's taking, you know, there's fewer emerging managers taking longer to close.
1:52:18
close. And then it's harder than ever to even as you go and you're like a multi-stage mega fund to still go raise the like equivalent of like the Andre $15 billion you know sort of total you know you know growth fund it is non-trivial for people to do that because the things you're going to go
1:52:31
invest into in these late stage assets are now you know readily accessible directly via the you know LPS through all these all all these alternate you know sort of vehicles and so >> and it's not it's not like a huge secret what what companies are like the real winners. You don't need to pay
1:52:43
You don't need to pay >> fees.
1:52:46
It's not like there's like 100 logos.
1:52:48
It's like there's like seven logos that matter significant number of dollars.
1:52:52
So as an LP like you know why do I care about paying you know these fees versus like I know I'm getting into the exact same logo anyways but through this other vehicle.
1:52:59
>> So you have sort of like the private Mag 7 that everyone's excited about and LPS are getting direct access to.
1:53:03
Is there any effect of the fact that the public 7 are doing so well?
1:53:08
I was I was kind of laughing to myself like if I want exposure broadly to self-driving cars and I buy Google and humanoids and I buy Tesla and like there's a number and AI so you buy Google again and and it's like you can get a pretty broad portfolio of like sci-fi bets just by owning the mag 7 and maybe those get disrupted maybe you got to pick up other big companies but it's not like they're completely asleep at the wheel.
1:53:34
Is there is there a uh like a a little bit of a magnetism from the MAG 7 that might be pulling liquidity towards just public tech companies these days?
1:53:46
>> A bit but I would say also for most of these LPS they have like um you know and especially the endowments they have like pretty clear ratios that they want to maintain across basically like public private etc.
1:53:54
And so in some ways through the public market you know sort of accelerating they have you know if you remember in like 2020 during the crash there was like the reverse thing basically were like you know basically all of a sudden the private books basically weren't you know getting marked down nearly enough they're starting to represent like 20% of an endowment book and they're like we literally have to freeze all private investing.
1:54:12
Now you're in some way seeing like you know the reverse where you know people in some ways counter swung so hard where now some of these groups that want to maintain like a you know 7% ratio on private are all a sudden down to like three and a half and are trying to figure out basically where to deploy.
1:54:24
But that's where they're coming with these like you know sort of huge text to the table but they're seeing that there's like a multitude of options and they want a relatively like you know sort of limited set of names and why not just go basically like you know more and more direct into those names and as a
1:54:35
founder at some point you're like well like I like these venture guys on hill road but at some point when I'm a public company these are going to be the guys that hold my stock when I'm public and so I don't mind prioritizing them you know sort of basically directly and having them on board. So in some ways,
1:54:45
having them on board. So in some ways, you know, to tie this all the way back to Adrian, it's like, yeah, this past round, Adrian had a multitude of different, you know, offers from, you know, more traditional Silicon Valley
1:54:53
venture firms, but it's like, why wouldn't you take a Tro Price where Tro Price is going to be the person that likely just, you know, underwrites part of your IPO, holds it when you're public, you know, scales with you while you're, you know, sort of public. And so
1:55:03
And so you're seeing obviously, you know, you know, um, those types of firms come in much earlier into venture and then founders by default, you know, sort of prioritizing those.
1:55:10
You had obviously had the like wave in like 2021 where a bunch of the VC firms tried to become raas and enter into like the troll price you know sort of lane that all mostly obviously turned out to be like a disaster where it was just like these guys are not you know sort of public equities you know experts and do not understand what it means to you know manage that you know sort of book appropriately.
1:55:27
So I feel like most people have pulled back from that.
1:55:28
people have pulled back from that. Um so I do think you know it's a shifting landscape where I just don't think that um the current state of liquidity preferences that are given to you know like if you invest into a company at 500 billion in the public markets you do not get a liquidity preference right you
1:55:43
know as an investor I think it's less and less likely that some of these super late stage private companies keep giving that type of liquidity preference to investors and then I think also the like fee structure on these venture firms is almost certainly going to compress for some of these like super you sort of late stage you know types of rounds and funds. Mhm. Mhm.
1:55:58
>> Do you think uh we'll see any spaxs this year?
1:56:02
>> Well, >> specific specifically for for companies uh in our in our world, obviously there's spaxs like constantly, >> treasury companies and stuff going out, but but ventureback spaxs.
1:56:16
>> Yeah, I definitely um you know have uh had now you know a variety of companies that I'm involved with have had spack sponsors like pretty aggressively approach and like knock on the door.
1:56:27
I think like there are certain companies where it makes sense.
1:56:29
If you are a type of company where it's like look, I just need 500 billion or 500 million on the balance sheet.
1:56:34
[laughter] Billion would be great.
1:56:36
I'm sure love 500 billion on the balance sheet.
1:56:38
Um >> uh but yeah, you know, and your super deep tech long cycle thing. Yes. Makes sense.
1:56:45
I think there's just enough scar tissues from the 21 time period where it's like there's a very small handful of companies that like survived through that spat crazier, right?
1:56:51
Like there's that one um robotics company that works with Walmart pretty significantly.
1:56:54
It's like one of the few that has actually like, you know, sort of traded significantly up, but like the vast majority. >> MP materials. MP materials.
1:57:02
>> Was MP materials a spack though?
1:57:02
Uh, >> was it Chimoth Spack?
1:57:04
I thought >> I thought it was a Chimoth. Yeah, >> you're right.
1:57:08
It was a That was like I think almost like a part like it used to be public, went private, restructured, and then like basically >> Fortress Fortress Value. >> Fortress Value.
1:57:17
>> I'm just I'm just excited.
1:57:17
I'm just excited to see what American Exceptionalism Acquisition Corp >> Symbotic was the one that I was thinking of, by the way. I'm pretty sure.
1:57:25
Um, it's one of the few spacks from like 2021.
1:57:28
Let's look at >> Here's one.
1:57:29
Here's a spa cand candidate.
1:57:31
What about that uh that uh space moon that was getting around? >> Moon Hotel.
1:57:38
>> I mean, at $400,000 a night, it's pretty simple. Just do the math. >> Simple economics. >> It's simp.
1:57:44
It's just It's just a It's just a math problem.
1:57:46
>> I like that they're working on that.
1:57:48
Give them a couple decades. Let them cook.
1:57:49
Jordy, let the YC founder cook. >> Uh, Gabe in the chat. It was a pipe. >> Pipe. Okay. Yeah.
1:57:58
So, >> was a pipe pipe into that one. >> Yeah.
1:58:02
Symbotic is probably the best example of like basically spacked at um, you know, a looks like $8 billion valuation.
1:58:08
Now a $42 billion company basically like incredible obviously like outcome, but that's like of the basket of like the backs that we're in 2021.
1:58:16
It's like, you know, one of like, you know, 15 that basically ended up like that.
1:58:19
The vast down >> and so I think for most companies that makes sense. >> Yeah.
1:58:23
It feels like you get to do a big fund raise, you get a bunch of cash on the balance sheet and then almost certainly you're going to have a stock chart that just looks like this that follows you around and gets screenshotted in your face for the next like, you know, five years.
1:58:33
And then you look at some of these specs and it's like, oh yeah, they're up 40% this year.
1:58:38
And it's like, but they were 10 times bigger when they went out.
1:58:40
And and so you have this weird dynamic.
1:58:42
uh even if it puts cash on the balance sheet, it seems like it's a lot of lot of weird dynamic very different culturally to be running a public company dealing with the the stock is is symbotic and just a super underrated company.
1:58:53
It's like a Fordsized business. >> Wow.
1:58:59
>> I mean, yeah, it's large.
1:58:59
I think it's pretty underappreciated.
1:59:00
It's basically like I would describe it as like the best warehouse robotics thing since KA, but it's like you know publicly traded independent company.
1:59:07
My understanding is like pretty darn significant like you know roll out into all of Walmart.
1:59:12
Definitely not discussed enough.
1:59:12
I don't remember like the venture investors, you know, that were, you know, you know, you know, around the table, but it's like based in Massachusetts.
1:59:17
That's a part of why it doesn't get like, you know, a ton of ton of interesting heat, but yeah, I definitely think it's like pretty under the radar. >> Yeah.
1:59:23
Well, thank you so much for taking the time to come chat with us.
1:59:25
Have a great rest of your day. We'll see you soon. >> Good to see the boys.
1:59:29
Let's keep >> tactical nuke incoming. >> Tactical nuke. Oh, no.
1:59:33
[laughter] >> I was just me doing barbells for my barbell strategy.
1:59:38
So, I'm going to just keep doing my barbell. >> Keep repping it out.
1:59:42
Keep wrapping the barbell, boys. >> Goodbye.
1:59:44
[laughter] >> You had to nuke him. The truth nuke. Reream. That's a truth nuke.
1:59:49
One live stream, 30 plus destinations.
1:59:51
If you want to multiream, go to reream. com.
1:59:57
>> Uh, going from the truth nuke to the reream.
2:00:00
>> Speaking of robotics, next up we have Deepo from Skilled AI.
2:00:06
>> Got to give a shout out to Luke Metro.
2:00:08
Luke Metro joined a company.
2:00:08
was pretty under the radar.
2:00:11
Left Anderl to join Skilled.
2:00:14
>> There wasn't a lot of chatter about Skilled publicly at the time.
2:00:18
>> And of course, uh Luke is a goated picker and it's been marked up uh >> significantly >> uh many many many times since he joined.
2:00:28
So, >> but until the CEO arrives here in the Reream waiting room, uh let's talk about Reggie James.
2:00:33
He's joined General Catalyst as their creative director.
2:00:36
Uh he says it's an honor to be trusted to hold this position.
2:00:42
Uh he had the opportunity to spend a lot of times with incredible folks across the industry during uh his break, but the ambition that General Catalyst has to tackle huge problems is simply unnatural.
2:00:51
There's so much work to do to show the story of the immense world being built here, but I couldn't imagine doing anything else right now.
2:00:59
Um I'm I'm incredibly excited for this.
2:01:02
>> Super bullish on this.
2:01:02
Reggie obviously is Aura Max. He's motion maxed.
2:01:06
uh and uh I think if he can bring some of that to GC >> it feels like I mean GC is a massive fund uh but a little bit quieter.
2:01:14
They they're they're not going direct as much.
2:01:19
There's not a lot of noise and that just feels like more of a blank canvas than going into if you put uh Reggie at a different firm that maybe has a whole bunch of other doing a ton of stuff. Yeah. Loud. Uh you could Yeah.
2:01:31
This feels this feels like a really natural fit and I'm excited to see what he does with it. Yeah.
2:01:34
Uh let me tell you about Figma.
2:01:37
Figma make isn't your average VI coding tool.
2:01:39
It lives in Figma so outputs look good, feel real, and stay connected to how teams build, create codeback prototypes and apps fast.
2:01:48
>> Uh billionaire Rams owner Stan uh Kroni becomes America's biggest private land owner >> for Stan. Let's stand. Are you >> listening?
2:01:58
He's listening to the show.
2:02:00
I'm a Stan Stan and with Stan Stan >> buying nearly 1 million acres of New Mexico ranch land.
2:02:07
>> Stan's land is growing. That's fantastic news.
2:02:10
Uh >> farmland investing becomes increasingly popular, especially now that you know maybe somebody comes in and wants to build a data center on your farm and pay you know 10 times uh what you paid for it. Um, at 2.
2:02:22
7 million acres, Kronkey's holdings are larger than Yellowstone National Park, or the equivalent roughly 2 million football fields.
2:02:33
>> Uh, he bought 1 million acres of New Mexico ranch land in December from the H family behind industrial conglomerate Teladine.
2:02:42
>> According to the trade publication, Singleton Ranch's transaction is the largest land purchase in the US in more than a decade.
2:02:48
Land is back back on [laughter] the menu. >> Let's go.
2:02:54
>> Speaking of land, Greenland uh is in the news, of course.
2:02:57
Dylan says, "This is the equivalent of affordability in Greenlandic politics."
2:03:01
And he shares a screenshot here.
2:03:03
Uh it's a quote from a Greenlander who says, "I hunt whales and seals in the United States.
2:03:08
They think whales and seals are cute and shouldn't be hunted.
2:03:13
[laughter] That's what I'm afraid of.
2:03:15
Don't bring your fear of hunting.
2:03:18
Don't Don't bring Oh, whales are huge. I like this.
2:03:21
He's looking for a carve out.
2:03:22
He's looking for a carve out.
2:03:24
>> Let me keep hunting my whales.
2:03:24
Let me keep hunting my seals. Hey, you know what?
2:03:29
Abson, if you join up with America, >> can we work to get Kuck Abson on the show to talk about the business?
2:03:39
>> So, Kuck wants to stay with Denmark just because culturally it's it's cooler to hunt whales instead.
2:03:44
>> We can shift the culture. We kidding.
2:03:44
We I'm down to hunt whales.
2:03:46
I'll go hunt some whales and seals with you right now. I'll Let's hang out. What are you using? A spear. Spear gun rifle nuke.
2:03:56
>> What if What if this What if What if he's selling the blubber out the back door to power data centers? >> We got flashbangs.
2:04:00
We'll throw a flashbang in the ocean.
2:04:02
All the whales will be doing this. Oh no.
2:04:06
>> And then we'll with the harpoon.
2:04:09
>> I don't like I don't like seals. >> We got Joe.
2:04:10
He's reading He's reading Moby Dick.
2:04:11
I know about hunting whales in this country.
2:04:14
We would be happy to partner with Greenland on >> I'm I think I'm against whale hunting.
2:04:19
They're just so majestic. >> Majestic.
2:04:21
That's That's a synonym for cute.
2:04:24
>> But seals, >> you're the problem.
2:04:25
Oh, you don't like >> I have deep beef with seals.
2:04:27
Uh growing up surfing in the cold waters in Northern California.
2:04:32
Uh, by the way, last time I talked about surfing, I got mega cancelled on YouTube because I was talking about how surfing makes like brings your body temperature lower and then you spend all day trying to heat up.
2:04:44
People were like, >> "You were against surfing before work."
2:04:47
>> This guy is in a suit talking about surfing.
2:04:49
What does he know about >> Well, you're about to get cancelceled by the seal lovers in the >> No.
2:04:52
So, uh, seals will will like mess would mess with me.
2:04:55
I'd be out alone surfing in Northern California. Water's very sharky. >> Yeah.
2:05:00
And these things are the dogs of the sea.
2:05:03
So they'll run up and they would just slam into me and all of a sudden I think I'm getting attacked by a shark.
2:05:08
And then I'd just be in the water by myself beefing with a seal.
2:05:11
>> This is an incredible skill issue for you. Oh, seals annoying me.
2:05:13
Oh, I need I need I need I need seals to be hunted. It's fine. Hang out with the seals.
2:05:18
Let the seals mess with you.
2:05:20
They're they're the dogs of the sea. We love them. We also love Plaid.
2:05:24
Plaid powers the apps you use to spend, save, borrow, and invest.
2:05:30
Securely connecting bank accounts to move money, fight fraud, and improve lending.
2:05:33
Now with AI, Google Capital, he tried to warn you.
2:05:36
He said, I tried to warn you.
2:05:38
I'd say I'd say we're getting close to the bottom, but I have no idea.
2:05:43
Nobody wants to own these things.
2:05:45
He's he's referring to the problem with application SAS isn't vibe coding.
2:05:50
It's that vibe coding is only one of the many bare cases.
2:05:52
There's no valuation support for many of these names.
2:05:56
Free cash flow is a mirage due to excessive stockbased comp.
2:05:58
He is calling the uh the top on SAS boys.
2:06:02
Uh the SAS boys are not happy with BUO.
2:06:06
But he says speaking of stockbased comp, the delilution at some of these companies is absolutely disgusting. It's insulting.
2:06:14
VCs thousands and thousands and thousands of thousands of >> Snapchat Snapchat gives away the whole company every 10 years. >> Yeah.
2:06:22
what happens to competition and to margins and to future profits when the incre incremental feature is free to make.
2:06:28
Many of these companies are zero.
2:06:30
So you're gonna see his prediction is you see a lot of different VC funded SAS companies uh encroaching on each other's territory.
2:06:37
Oh, I'm in this category.
2:06:37
I'm just going to build this because >> yeah, the calculus changes when it's like, hey, this feature is going to take us like nine months to really build and be competitive.
2:06:45
And it's like, oh, it's actually going to take us like a month. >> Two seconds. It's done. Boom. >> Yeah.
2:06:51
Uh it's not clear where the value will acrew.
2:06:52
Investors are thinking of Netflix gathering all the value on top of cable or OTAA stealing all of the value on top of legacy systems of record last and certainly not east least even if you don't think application SAS is a zero everyone else seems to.
2:07:04
So who's going to step in to buy these things?
2:07:06
Uh probably private equity.
2:07:08
One of them has to accelerate for real for the money to start flowing in. Yes. Uh interesting. He could go on and on.
2:07:15
Anyway, >> Naruto in the chat says, "I've done the swim from Alcatres in SF.
2:07:19
People running events sit in boats and prevent seals from biting the swimmers."
2:07:25
>> See, send this post to Greenland.
2:07:25
Let them know we know how to fight the seals.
2:07:29
We know how to beat them back when our Americans are swimming. >> Yeah.
2:07:33
I mean, the biggest mistake they're not making is flashbanging the seals.
2:07:36
>> Flashbanging the seals.
2:07:36
This is >> They didn't study. Yeah.
2:07:38
Scientists have made a spray-on powder that can seal serious wounds in seconds.
2:07:44
Speaking of seals, sealing wounds, uh the South Korean developed powder reacts with elements in the blood and turns into a gel to form a barrier to stop bleeding. Uh this is not that new.
2:07:56
There's coagulants that exist.
2:07:59
We we've talked to a few folks about this.
2:08:02
Um on Jake Adler has has a similar coagulant and then also there's quick clot from the late 90s I believe.
2:08:10
Um but exciting to see more uh more development in the in the healing of wounds.
2:08:17
>> Toma Bravo has a piece in the Financial Times.
2:08:22
>> Uh really >> and they say broader integrated software platforms for business are positioned to win out against those selling specific services.
2:08:29
>> The explosive rise of AI startups follows a pattern we've seen before.
2:08:32
Small companies racing to apply new technology to specific business problems.
2:08:35
Let's give it up for applying new technology to specific business problems.
2:08:39
Uh doesn't get enough love.
2:08:39
uh promising huge efficiency gains in their narrow slice of the market.
2:08:43
These startups typically use standard AI models and distinguish themselves by writing software on top in order to target specific tasks.
2:08:50
Their value proposition is that specialized solutions can compete without worrying much about how businesses function as complete systems.
2:08:57
But this is a vulnerable strategy like companies that burn cash without sustainable business model models.
2:09:04
Many of today's AI startups burn money paying for access to AI models while lacking advantages that competitors can't copy.
2:09:10
Their core bet is that AI can solve specific business problems so efficiently that companies will willingly go beyond their integrated systems to get superior performance in one area.
2:09:19
In short, best-in-class beats good enough but all in one place.
2:09:24
But connecting to full business processes to find a sustainable growth path over time is a very challenging task for companies built to do just one thing.
2:09:32
While some might see be seeing sharp initial revenue acceleration, they also see substantive costs.
2:09:38
One study by Cruz Consulting suggests they spend double what traditional software as a service companies spend on compute and infrastructure while also paying for specialized talents that command high pay packages.
2:09:49
These structural challenges show why we believe established software platforms such as Salesforce, SAP and Microsoft and portfolio companies like Anoplan and Koopa that we invest in at Toma Bravo will be more durable despite the risk of AI disruption to their businesses.
2:10:03
While AI startups struggle to defend narrow territory, broader platforms build advantages that often grow stronger over time.
2:10:11
Rather than just making one specific area better, they work on strengthening the broader business of a customer.
2:10:16
This model produces intelligence for both the company and the provider building capabilities and SAS companies have years of making improvements.
2:10:22
For example, software platforms can model cause and effect across business functions.
2:10:25
A narrow AI tool might optimize an inventory, but if it doesn't consider cash flow, supplier relationships, or supply chain risks, that optimization on a single variable could actually stand to hurt the business.
2:10:38
uh established software companies are are thus better positioned to address business concerns on AI integration, competition, implementation challenges, security, uh cyber security, legal, ethical questions, cost and reputation risks.
2:10:52
This is because digital transformation has always meant balancing efficiency gains with risk management.
2:10:58
Uh uh trying to uh see if there's anything else here that's worth reading.
2:11:03
reading. I I think the main thing is like being in a position like Tommo Bravo where you're meant to be deploying tens of billions of dollars amid when you have the shifting sands is like uh pretty harrow like there's a ton of opportunity
2:11:20
>> very exciting time but it's also harrowing >> yeah well let me tell you about Vanta automate compliance and security vanta [applause] is the leading AI trust management platform and we have our next guest we are in our Lambda Lightning round. We have Deepo from Skilled.
2:11:34
We have Deepo from Skilled. >> How are you doing?
2:11:37
Good to have you on the stream.
2:11:39
Thanks for >> Great setup you got here. >> Fantastic setup.
2:11:41
Thanks so much for >> testing it for the first time and as you can [laughter] see there a few issues in between so we do not know. >> Yes.
2:11:50
Uh please uh introduce yourself and the company since it's your first time on the show. >> Yeah. So thanks for having me. I am Deepak Deepak.
2:11:58
I'm a CEO and co-founder of Skilled AI.
2:12:01
So at skilled what we are doing is we are building a general purpose robot brain.
2:12:05
Now >> any robots any task one brain.
2:12:07
So when I say that it's like even a humanoid or quadro robotic arm hands everything governed by a single brain and that is what we do.
2:12:20
>> Uh let's get into the news from this week and then we have a bunch of questions. >> Sounds good.
2:12:26
>> Uh what what happened this week?
2:12:29
>> Well there are this has been a busy week for us.
2:12:30
uh I think back to back we had multiple announcement.
2:12:32
Uh we began with uh the the announcement regarding learning from human videos.
2:12:37
We showed a lot of results but the latest announcement which is just from uh yesterday is about the funding announcement u raised >> how much did you raise >> close to $1.
2:12:47
4 billion uh which values the company now at $14 billion.
2:12:55
[music] Uh, incredible, incredible.
2:12:58
Um, yeah, let let's talk about where you're most uh excited about the application of robotics in the very very near term.
2:13:07
Uh, there's so many different obviously angles, industries, kind of form factors, uh, that are exciting.
2:13:14
But where where are you guys focused on today working with customers?
2:13:19
Yeah, I think this is uh whenever in public folks talk about robotics uh on the consumer side, the excitement becomes okay, we have robot coming to our homes next month and I my robot will do X Y and Z.
2:13:33
And people don't realize that robotics is not a new field like this is one of the oldest area in technology.
2:13:39
It precedes computer and in fact it preeds AI >> and robotics for 70 years.
2:13:46
You see all these movies and even real world demos of robots but still we do not see robots around us and we begin to feel that robotics has not arrived yet.
2:13:55
But if you go to any go to any big factory go to like car factories or Amazon you will see like tons of robots thousands of robots doing things manufacturing items etc. Now what's the gap?
2:14:08
The gap is we cannot get robots beyond these beyond these demos or beyond these factory settings to consumer scenarios because the brain has been missed and that's what we bring to the table.
2:14:20
Now in this setup it is a step-by-step approach.
2:14:25
Even in factories even in enterprise the robots are there but they are in a red tape area like behind an area where you cannot go and if a human goes there they have to turn off the robot and that's where you start first you start to get these robots alongside people.
2:14:38
So what we are doing right now even we are already deploying in variety of areas like uh pointto-point delivery systems even warehouses manufacturing but the change is we are doing it alongside you where people can come and interact and do their own work and the robot will go to the side in with randomized scenarios people is important because people create randomness and chaos and that's where AI needs to come in. >> Yeah.
2:15:05
How are you uh feeling about the supply chain?
2:15:08
Are there any bottlenecks that you're worried about coming down the pipe?
2:15:12
We've seen so many unexpected bottlenecks pop up in just the data center buildout.
2:15:16
Talking about copper today, that was not on my bingo card.
2:15:18
Uh what should we be worried about if we if we were going to be scaling robotics over the next couple years?
2:15:26
>> Yeah, I think this is exactly uh why we are scaling the way we are.
2:15:30
>> If you think about going like for every different application, there's a different hardware requirement.
2:15:36
If you are doing something for data centers, you need a different kind of robot for doing things and specific other scenarios.
2:15:43
And this is where getting all the supply chain all together at once, it takes a long time.
2:15:47
But as I said earlier, robots are not a new thing.
2:15:51
Industries have already been deploying them for variety of scenarios.
2:15:53
The ROI has been less because you have to create a separate area, separate warehouse, customized scenarios for them.
2:15:58
So we can piggyback on those supply.
2:16:00
So what we the model we follow is we partner with hardware companies or even end users who have hardware and we provide our software as a service on top and that enables very fast go to market strategy for us and these robots which may be earlier in a in a secure area where humans cannot enter now can be used around in in outside alongside people and start to work.
2:16:26
>> Uh how much how much hardware do you guys actually build internally specifically for testing?
2:16:30
specifically for testing? I can imagine there's uh uh certain kind of like products where you're working just just on the software side working with a specific customer but then on the internal side for like you know having faster feedback loops I imagine you're uh building quite a bit as well >> you can today what has changed the last
2:16:49
five to seven years is you can purchase a lot of commercially available hardware uh and in fact every single robot hardware probably you have seen on the internet has made made its way to our office and we already have large number of them as long as the company sells them and gives us access to fully control the robot through our software. So we take the hardware we put the model
2:17:08
So we take the hardware we put the model is an end to model goes from direct from pixels in to actions out and it takes control of the whole hardware and makes it a skilled robot.
2:17:17
Uh what what form factor uh do you think Rob uh what robotic form factor do you do you think will be the first to make consumers feel like robotics has really arrived? Right.
2:17:32
You talked earlier about how it's like commonplace in a [clears throat] commercial setting, but it's happening like in a warehouse.
2:17:39
No one's really seeing it and so they're not kind of like feeling the acceleration yet.
2:17:42
But uh uh on the consumer side uh when do when do you think people will have that kind of like moment?
2:17:51
>> This is a very very very good question and I think it goes to the root of what people think of robotics when they say okay I I want a robot in my home.
2:17:57
Okay let's say the most common thing in Silicon Valley like I want robot in my home in this year but when has it happened that you suddenly have have things in your home and you do not see them in your daily lives. >> What about groceries?
2:18:11
Like do you see robots in grocery store? What about Target?
2:18:16
You go to you order something you waited for two hours for it to get picked up ready and then it's a pain to get even pick it up. What about hospitals?
2:18:23
What about uh any of these uh consumer facilities which deal with consumers but are on the enterprise and that's where we believe you will begin to see robots first.
2:18:33
It will become a commonplace thing and then you start to get them in your robot.
2:18:37
Like if I give you a robot to you like today, you will probably use it and you will like it for for a few months.
2:18:44
Then it will sit in your garage like a massage chair which I don't know [laughter] and then never get used again.
2:18:50
So it has to first come become common in your daily life that you're not surprised.
2:18:55
Okay, I have this in my home and and ready to go.
2:18:57
And that's where we are enterprise is a stepping stone to the eventual consumer deployment.
2:19:00
And yeah, I can go deeper into this.
2:19:04
What is the other reason for this?
2:19:05
But this is one of the practical reasons.
2:19:07
The other reason is data >> and that's can go for go into any. >> Yeah.
2:19:13
What what what what kind of uh bottlenecks are there on the data side that you guys are seeing?
2:19:20
>> Bottleneck as in [laughter] bottleneck when there is something in in high quantity and and it's coming through a squeezed hole.
2:19:28
Uh but there is no data for robotics.
2:19:30
This is the this is the the main uh the main issue.
2:19:32
It is not one of those AI areas like as I said robotics was when the initial AI projects were done at MIT and other places they were done in the context of robotics.
2:19:45
robotics. It has been 70 years chips have the gram has come down from a room size to like cannot even see that so tiny transistors robots is still not around them and the reason for that is unlike language or vision where you can build GPD like models LLM like models there's a data for robotics
2:20:03
>> and that's where the technical part becomes very critical so what we do today is we bootstrap someow you have to somehow bootstrap the process to deploy the robot in the on a site you cannot say I'll get a data deployment and uh but to deploy I need a problem like to deploy I need the brain to function for the brain to function I need data. So
2:20:22
So how do you break this problem?
2:20:24
To bootstrap that what we do is we start with two such alternate sources.
2:20:28
We learn by watching people.
2:20:31
So learning by watching people act like uh there are tons of lifestyle videos on YouTube uh and Flickr and other sources.
2:20:39
We watch them and have the robots learn from that.
2:20:42
And the second source is simulation >> and we put them together uh to transfer these results to the to the real world.
2:20:49
And once they get deployed then we get we can establish this data privy where the more deployments increase the more data you get back and that increases your further your uh the performance of your model. >> Very cool. >> Makes a lot of sense.
2:21:03
>> Well, thank you so much for >> Yeah, great to great to finally meet.
2:21:05
>> Yeah, great to finally meet.
2:21:05
We're huge fans of Luke Metro. He's a great pet guy.
2:21:09
>> Yeah, we'd like to nominate him for employee of the month employee of the year.
2:21:12
>> We don't know anything about the other no insight, but he's the employee of the month in our >> We think he's a great guy.
2:21:16
He's a good [laughter] >> of the month.
2:21:18
Employee of the month every month. >> Fantastic. Fantastic.
2:21:22
>> Uh well, >> uh so great to finally meet you.
2:21:23
Uh and congratulations on all the progress.
2:21:27
>> Have a great rest of your day. We'll talk to you soon. Cheers. Goodbye. >> Public.
2:21:30
com investing for those who take it seriously.
2:21:32
We got stocks, options, bonds, crypto, treasuries, and more with great customer service.
2:21:37
Our next guest is David Tur from Carmen Industries as well. He's coming in.
2:21:43
I'm going to tell you about [music] Cognition.
2:21:44
They're the makers of Devon, the AI software engineer.
2:21:47
Crush your backlog with your personal AI engineering team. Good to see you. Welcome to the show. First time on the show.
2:21:54
>> First time on the show.
2:21:55
>> Uh thank you so much for coming in person.
2:21:57
Uh please kick us off with an introduction on yourself and the company.
2:22:00
>> Yeah, David Turus, uh co-founder and CEO of Karman Industries.
2:22:02
Uh we actually launched today our heat processing unit.
2:22:07
So an HPU and this is a cooling system designed for gigawatt scale AI factories. >> Okay.
2:22:13
cooling the entire data center, the individual chip, both what do you >> all so typically a lot of these are cooled with a similar loop because you've got high high memory bandwidth, you've got GPUs, you've got air handling, all that type of stuff.
2:22:27
>> All of this is about reducing the complexity of the infrastructure.
2:22:29
Okay, >> so our overall solution is actually a 10 megawatt modularized solution and that's very different than the 1 to 2 megawatt ones from the existing solutions out there.
2:22:40
>> And we reduce that mechanical yard by about 80%. Mhm.
2:22:43
>> So your speed to deployment increases rapidly with this.
2:22:48
>> So uh heat is generated as they put electricity through the silicon ship and old Facebook data center.
2:22:53
Uh they would just open the window and blow it out with fans I assume you know air cooled systems.
2:23:00
Now we're seeing a lot of uh water cooling.
2:23:02
Uh walk me through like try and uh explain what is the actual flow of where the heat goes how it's moved around. >> Yeah absolutely.
2:23:09
So pretty much every single electron that goes into a day center gets turned into heat. Yeah.
2:23:14
>> Comes right into these chips.
2:23:14
They generate a huge amount of heat.
2:23:15
So now when we're talking gigawatt scale, this is a gigawatt worth of heat. >> Yeah.
2:23:21
We talked about there's a there's a bath house in New York called Bath House.
2:23:25
And they they originally would heat the the the bass with bit via Bitcoin mining.
2:23:31
>> There was so much heat coming off of it. >> Yeah.
2:23:33
And racks used to be kind of in this like 5 to 20 kilowatt per rack.
2:23:34
Now we've jumped up to 120 kilowatt per rack.
2:23:39
The Vera Rubin coming will be 600 kows per rack and they're trending towards a megawatt in a rack.
2:23:44
>> So when you think of how much power that is, a megawatt's a thousand homes consumption. Yeah.
2:23:48
>> And putting that in a rack >> and that all gets turned into heat.
2:23:50
So you have to move that the most efficient way possible.
2:23:53
And today 20 to 30% of your energy is going towards cooling.
2:23:58
>> That is a opex constraint.
2:23:58
That is a thermal constraint.
2:24:01
And it's just you're not generating revenue with that. Yeah.
2:24:04
So we're trying to shift that and we reduce that at a minimum of by 25% energy consumption on the cooling side. Yeah.
2:24:10
Now you can have more headroom that you're using towards compute. >> Yeah.
2:24:13
And what's the what's the material?
2:24:14
What's the substrate for extracting the heat, air, water, something else? >> Yeah.
2:24:19
So we interface with the existing systems that are there.
2:24:22
So we we integrate with the glycol loops that go to the chip level to the CDU side of it. Okay.
2:24:28
>> But inside our actual system, we using super critical CO2.
2:24:30
So, we're running a high-speed compressor that was developed in-house by our team.
2:24:34
We have a huge amount of history from SpaceX Rocket Lab.
2:24:38
About a third of our team comes from there.
2:24:40
And we've really designed this from the ground up.
2:24:42
Our first one we came up and running in 8 months with a fourperson team. >> Ran it at 30,000 RPM.
2:24:47
Uh the next system will be coming together in Q2 here.
2:24:49
And yeah, we're using super critical CO2 due to the high density of the >> energy density.
2:24:56
So, it can absorb the heat. It absorbs the energy.
2:24:58
It heats up and then you move it somewhere else. >> Yeah, we remove it.
2:25:01
We we vent it to ambient.
2:25:03
But why we're calling this a heat processing unit is because >> today we view heat as a liability and as a constraint, >> but heat is energy and it's an asset.
2:25:13
And so we're building the the platform that allows you to remove that heat from your system as efficiently as possible.
2:25:20
Y >> and it opens the door for future use cases of heat reuse. >> Sure. Yeah.
2:25:24
I want to talk to you about that because I've seen some of the hyperscalers have put out statements saying that uh there is waste heat from our data centers, but we're going to be able to pipe it into the local community, basically give everyone free heat in their homes.
2:25:36
And that sounds really good as long as I guess it's clean air.
2:25:39
Um but it seems like a good use.
2:25:41
What does it take to actually go from a data center in the middle of nowhere to a data center that's closer to a bunch of homes to get the energy, get the waste heat there, and maybe just warm up someone's house during the winter?
2:25:51
Yeah, I think Europe will be more ahead of us with than us just due to the proximity of those data centers to urban locations just smaller, smaller countries, right?
2:26:02
>> So where we see also a great opportunity is to do waste heat back to electricity. >> Oh, interesting.
2:26:07
>> And actually supply that back to the data center.
2:26:09
So in your colder regions at night during the winter, you'll have a big enough delta t where you can actually do that with our system. Okay.
2:26:16
>> So that becomes now additional headroom that you can use towards compute. Okay.
2:26:19
as well as then I kind of half seriously half joke that right now data centers are not in my backyard that's the vibe that everyone has but what if we built communities around these and you have free utilities if you live there >> that would be huge people would like we were talking about this yesterday just
2:26:34
like if if somebody's you know you hear a data center coming into your backyard anywhere your in your town there's no there's no d for a lot of people there's not going to be direct upside correct just because even if it's not there I can still use all the different AI tools Right. I'm not like limited just because
2:26:49
I'm not like limited just because there's no data center even in my state. >> So I like that.
2:26:53
Uh talk about discovering the opportunity, the journey to getting here.
2:26:59
>> Uh maybe your background when when we met you were in uh this was probably a couple years at this point.
2:27:03
You were in the idea maze looking at a lot of uh different opportunities and uh seems like you found a super exciting one. >> Yeah.
2:27:11
So kind of going through that is yeah I was an entrepreneur residence at Ride Ventures looking for what I was going to build. Yeah. Shout out Will.
2:27:18
And I it it really takes people that are true industry experts, worldclass engineers to develop something new.
2:27:25
And I ended up partnering up with my co-founder, Dr. C. J.
2:27:29
Kalra, who had spent pretty much his entire career in the thermal energy space.
2:27:32
Most recently head of technology at Antora.
2:27:34
Prior to that, um, worked at a couple different startups, but started his career at GE Research working on superc critical CO2.
2:27:42
>> So that's exactly what we're doing here with our system.
2:27:44
So he was we when we started working together, it was looking at this broader thermal infrastructure layer.
2:27:52
>> 50% of all end energy use is used for thermal management.
2:27:54
We're either heating something up or we're cooling something down.
2:27:58
>> And we're doing it with outdated technology.
2:28:01
>> So we're leveraging the tens if not hundreds of billions of dollars that has been spent across turbo machinery in the rocket industry, high-speed power electronics, silicon carbide, permanent magnet motors, and the EV revolution.
2:28:12
packaging this all together and bringing it to the most pressing need which is the thermal management of data centers right now.
2:28:18
This is a huge problem for them.
2:28:20
>> Uh how have have you been bouncing all around the map checking like on the ground at at at at various data center projects? >> Yeah, a a little bit.
2:28:28
Now they're these things sometimes are more heavily guarded than Fort Knox.
2:28:31
You know, these guys have machine guns outside of these things. It's hilarious. >> Yeah. No, I know.
2:28:35
But but once you're uh once you're you know working with somebody and like actually doing a deal, I'm sure the the doors get open. >> Yeah, absolutely.
2:28:43
And we're going to be launching these actual deployments starting later this year.
2:28:47
Uh we're standing up our first factory, Gigaworks 1, which will be a thousand mega or sorry 100 uh units per year of 10 megawatts.
2:28:55
This is a gigawatt size capacity right out the gate because this the demand is so extreme compared to where the supply chain is right now. >> Yeah.
2:29:03
So if if we see one of these data centers, maybe it's 150 megawatts, maybe it's a gigawatt.
2:29:07
Um how many heat processing units would they buy from you?
2:29:12
Is it a modular system where they might be using some legacy uh system as well and then uh bring you on incrementally or do they need to go all in and and work with you exclusively?
2:29:24
>> No, we're very much plug-andplay with the existing solutions that are out there.
2:29:26
So you could if you have an existing data center with an existing cooling system, we could phase in our system over time.
2:29:31
Um but yes, a lot of these are clean sheet designs that are going up right now and right now this is one of the biggest bottlenecks for them for deployments. >> Okay.
2:29:41
So yeah, there's obviously just a bottleneck of like if you just can't get any sort of cooling uh you know from the market like you you'll just be delayed.
2:29:51
Uh talk about the actual economics of someone who goes with you for a new build.
2:29:55
Is this higher capex lower opex over time or or how should a CFO who's working on a new data center think about working with you and the trade-offs involved? >> Yeah, absolutely.
2:30:04
So, our actual capex of the system is the same as existing solutions out there >> and the snowballing effect of reduction of size, reduction of infrastructure, redu reduction of piping make this a cheaper solution right out the gate, >> faster deployments because time is money on these deployments.
2:30:21
as well as then when you actually look at the efficiency of our system.
2:30:26
So in your worst conditions, this is you need to cool your chips at 20C.
2:30:29
In Texas during the middle of the summer, we have a 25% energy reduction in the cooling system >> of the state of the art.
2:30:36
>> When you start looking Virginia, some of these, you know, more moderate climates, we're looking 60 to 100% uh improvement in performance of this system, which that unlocks huge amounts of headroom. >> Yeah.
2:30:47
So, it's not as much about the opex savings because we do do that, but what we really unlock is the ability to >> allocate more of your electricity towards compute, >> which that's that's the money maker in this thing.
2:31:00
>> Yeah, that makes sense.
2:31:00
Um, >> talk to me about uh manufacturing a heat processing unit.
2:31:06
Are there co-ackers for this thing?
2:31:09
Can you go to a turnkey manufacturer once you have a design or a CAD file?
2:31:13
you call in Hrien or someone uh or are you gonna vertically integrate and kind of make these in a in a warehouse somewhere?
2:31:20
>> Yeah, we're going to vertically integrate Okay. a huge amount of this. Yeah.
2:31:23
Now, there's certain key components that we have a supply chain for. Sure.
2:31:29
>> Uh around the motor, around a couple other pieces in there, >> tubing and pipe and stuff like that.
2:31:35
>> So, we're taking very much the the SpaceX approach.
2:31:36
People think SpaceX vertically integrated from day one. They didn't.
2:31:39
They bought a lot of things off the shelf and then they looked at where they could either make an improvement or bring the cost down.
2:31:44
And we're doing that exact same thing.
2:31:46
>> A big piece of this also is diversity in our supply chain.
2:31:50
>> We need to make sure that we're not single string in any one of these single components cuz the big guys, the hyperscalers are saying, you know, you need to produce a lot of these and you cannot slow down my deployment.
2:32:00
You know, the reason that they're coming to us is because we're speeding up their deployment.
2:32:04
So, we're making sure that we have >> derisked every piece of our supply chain.
2:32:08
our chief operating officer. She came from SpaceX.
2:32:10
She was leading all of production at Millennium Space Systems before she joined us.
2:32:13
Um, so we have a rockstar team and that's always what Carmen has been about. >> Yeah.
2:32:20
What what do you think you I mean it sounded like you wanted to have these in production pretty quickly.
2:32:23
Uh, what do you think about the the the lead time, the battle of the press releases, the idea of going out and getting a couple big headline deals done and then using that to either raise money against those or even just have them pay you upfront and then that kind of finances the growth.
2:32:39
How are you thinking about like the the investor relations aspect of the business?
2:32:44
>> Yeah, I mean I come from an investor background.
2:32:45
Uh, we did actually announce the the series A this morning as well.
2:32:50
>> We got a gong for you. Hit the gong for us. >> Give us the details. Give us the details. details. >> It was Riot Ventures.
2:32:54
Uh they they were our lead.
2:32:56
We closed it back in September. Fantastic. Kind of under the radar. Yeah.
2:33:00
It was Riot Ventures, Space VC, Wonder Ventures, and then Sunflower Capital.
2:33:04
And we also brought on Pat Gellinger. >> Oh, yeah.
2:33:06
As an investor as well, >> of Intel. Hit that gong. Congratulations. >> Yeah.
2:33:17
Gong brings out the technique industry. It's good. Good technique.
2:33:22
Talk to me about the name.
2:33:22
It feels like you'd be a space company. Uh you're not.
2:33:26
Is it is the Is there something more about to the Carmen line or is that the reference?
2:33:31
What's >> Yes, Theodore Von Garman, famous physicist.
2:33:34
He did kind of coin the term of the the difference between our atmosphere and space.
2:33:37
Uh but just his work in supersonic and hypersonic flow, okay, was a lot of uh the inspiration for this. >> That's amazing. That's amazing. Uh what's next? You're hiring. Uh how big is the team?
2:33:49
Where do you want to be in a year?
2:33:51
or how are you thinking about growing the business?
2:33:53
>> Yeah, we're 23 people right now.
2:33:53
Uh we have the core team in place to build these first units, get them up and running.
2:33:58
The scaling piece will be all technicians to be able to actually manufacture a huge amount of these systems.
2:34:04
>> Technicians, what what what uh where are you pulling from?
2:34:07
Where are the like where do people do this work typically? What skills? Is it a trade school?
2:34:11
Do they have college degrees?
2:34:13
Are they mechanical engineers?
2:34:14
Like who are these people? >> Yeah.
2:34:16
So we that the kind of first wave of them is going to be people with a I would say very diverse skill set within manufacturing. Okay.
2:34:24
And that's because when you're building these first units, you don't actually know exactly where the sticking points are going to be and you're doing this kind of design for manufacturing while you're also standing up the manufacturing piece of it.
2:34:36
>> So you have to be able to troubleshoot as you're building something out. >> Yeah.
2:34:40
You want very highskilled generalist technicians.
2:34:42
And then we will move into more specialized as we go increase the velocity of that the actual production side of >> Are you in the Gundo?
2:34:50
>> We are actually in Long Beach. >> Long Beach. >> Okay.
2:34:54
>> Bigger facilities down the >> bigger facilities. >> Yeah. Yeah.
2:34:56
I mean if you need a lot of space uh it feels like a lot of companies have graduate.
2:34:59
They they go to they hang out.
2:35:01
>> How big are the actual systems? >> Yep.
2:35:03
They're the size of a shipping container. >> Okay. >> Shipping.
2:35:05
So we got to build a hundred of those to do a gigawatt in a year. >> Okay. >> So it's very doable. >> Yeah.
2:35:09
And and and would you actually stack them up a hundred of them at a at a big uh data center site? >> Yeah, absolutely.
2:35:15
I mean, you go look at these data centers today and you do an aerial view of one of them >> and you have more square footage getting taken up by the exterior mechanical yard all for cooling than you do the data center. >> Yeah.
2:35:26
>> So with a one or two megawatt one, if you're building a gigawatt data center, you've got 500 to a,000.
2:35:32
>> Wait, is that the current status? Correct. Okay.
2:35:33
Because I would assume that there'd be some sort of uh mechanical economy of scale where if instead of you know you have a thousand tubes and a thousand you know like uh compressors and a thousand and if you can just reduce that by just doing one really big one but there must be some >> but then there's on-site construction with that.
2:35:50
It's a custom build all these were really designed originally for hospitals universities doing cold water systems.
2:35:58
You'd put two or three of them on the roof. They work great.
2:35:59
These are con controls carrier train type systems out there >> at the at the 1 megawatt level. >> Correct. Yeah.
2:36:05
>> So you're scaling that up but still staying in a deployable form factor that can fit on the back of an 18heer. >> Yep.
2:36:11
And that's what CO2 is great for. Got it. >> High density.
2:36:13
Uh we run a high-speed turbo compressor inside there that was designed in house.
2:36:16
That's how we get the 10 megawatts in there. Got it.
2:36:18
And then the actual fan system is separated from ours.
2:36:22
And that's actually we've decoupled that from our design.
2:36:25
>> And you're you're building a thousand of these this year. >> 100. >> 100. Okay. Okay.
2:36:29
And what what's the rough uh what's the rough price [snorts] range for one of these things?
2:36:33
You can give me give me a wide I know it's call me but like a wide wide range. >> Yeah.
2:36:39
You're you're kind of in that we'll call it 750k a megawatt type range. Got it. Very nice.
2:36:46
>> So it scales up very fast. >> Yeah.
2:36:48
What what uh what are the like environmental considerations of uh compressed CO2?
2:36:53
people worry about emissions but uh what's the net impact of using CO2?
2:36:59
>> So CO2 is actually the gold standard for refrigerants.
2:37:02
>> Okay, >> because today they're using R123 4A something from Honeywell.
2:37:06
They while they have tried to push down the global warming potential of those >> they now form forever chemicals over time. >> Okay.
2:37:14
>> So CO2 is a global warming potential of one as it is your baseline.
2:37:18
>> It does not form forever chemicals over time as well. I >> Let's go. >> Yeah. Exactly.
2:37:22
So, [laughter] it's >> we're going to get we want to get CO2 cannons in here. >> There we go. Yeah.
2:37:27
No, it's actually a great working fluid for many reasons on that. It's nonflammable.
2:37:31
Uh and then the energy density of it is just dramatically higher than the existing solutions out there as well as it's abundant. It's cheap. >> Yeah. Interesting.
2:37:39
Uh and so walk me through like a a data center construction in I don't know 2028 or something.
2:37:46
Is it possible that they're that they're off water entirely?
2:37:48
There's no water cooling or would that still be a piece of the puzzle? >> Yep.
2:37:54
So, our system while you use water as in like the glycol loops, >> yeah, >> ours is a closed loop system. Okay.
2:38:01
>> So, it does not consume water at all. Interesting.
2:38:03
>> Which is a big >> plus for these data centers because we're getting a huge amount of push back. >> Yeah.
2:38:07
>> Gigawatt data center can pull over a half a million gallons an hour to keep it cool.
2:38:12
>> It's an astonishing amount of water. Interesting.
2:38:14
So we've seen a huge amount of reception from the hyperscalers around closed loop, zero water, doesn't form forever chemicals, natural refrigerant.
2:38:22
All of these things are speaking exactly how they want to build data centers going forward as well as that compact package is speed to market.
2:38:29
At the end of the day, it's how fast can I build this?
2:38:31
>> How how are you prioritizing your pipeline?
2:38:33
Y >> it's kind of a it's like there's not I imagine there's some potential like mom and pop.
2:38:40
>> There's hyperscalers and there's neo straight for the hardcore.
2:38:42
go to semi analysis, look at cluster max, call every single person. Right. >> Yeah.
2:38:47
So, we've definitely been talking to a lot of the big, you know, named people out there as well as the Neoclouds, the ones that are kind of step below that.
2:38:54
>> I would say for probably every one of these big gigawatt campuses that you hear one of the hyperscalers announcing, there is three to five in that are kind of shadow data centers that may look like an Amazon warehouse and they're colllocators.
2:39:06
They're selling that compute to others.
2:39:07
Each one has it, I would say, its own unique reasons why they get excited about what we're working on.
2:39:13
But yeah, that's actually a very ongoing consideration right now is how do we allocate our 2027 production numbers right now? >> Yeah. >> Fantastic.
2:39:23
>> Where are you trying to how many units do you want to produce in 2027?
2:39:26
>> So, this fall we will stand up that factory with an annual run rate of a gigawatt.
2:39:30
So, in 2027, we'll do about a gigawatt worth of actual production. >> Cool. That's amazing. Well, congratulations.
2:39:36
Thank you so much for coming on down to the TBP and Ultra Dome and great to have you.
2:39:39
It's amazing to uh uh this feels like the perfect opportunity for you and a very uh necessary problem to be working on. So absolutely awesome. >> Thanks for having us. >> Thank you so much.
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2:40:13
And we are ready for our second guest in the TVP Ultradome.
2:40:18
Today we have Blake from Brinks in the studio with some physical hardware. We have >> Make room. Make room.
2:40:26
You want to put it right here in the front? Maybe.
2:40:29
>> Yeah, you can put it on top of here maybe. I don't know.
2:40:31
Wherever you want in the front. That works.
2:40:32
Uh we have a drone, two drones in the studios.
2:40:34
Uh thank you so much for bringing this.
2:40:39
Thank you so much for coming on down to the TV Ultra Dome.
2:40:41
Uh second time on the show, but uh reintroduce yourself.
2:40:44
How long have you been working on the >> By the way, this thing is alive.
2:40:48
>> It's [laughter] alive. We got a live one. >> It's a heartbeat. >> Yeah, no doubt.
2:40:53
>> Uh so yeah, uh briefly uh reintroduce the company and uh just explain kind of the scale and size of the business these days. >> Yeah. No, my my pleasure.
2:41:00
So, um, story story of me and the company started my engineering career off over at McLaren Automotive.
2:41:06
Uh, I was 14 when I was working there. So, >> Amazing. I think I was there.
2:41:10
>> You're why you're why you're you're you kind of can take a little credit for the W1 >> the Well, that and the re, you know, the Landos. >> Yeah, I'm sure.
2:41:19
>> Unfortunately, neither of those things, [laughter] but I I can take a tiny amount of credit for the 720S. >> Okay. Oh, no way. >> How's that? That's amazing.
2:41:27
>> I I worked on some parts that are on the underside of that. >> Reallying. That's amazing.
2:41:31
>> So that that was an insane first engineering job.
2:41:33
Obviously, >> it's been all downhill [laughter] >> in some ways. Yes, dude.
2:41:37
I mean, it's it's hard to match walking by MP4-4 every day on my way to lunch.
2:41:42
I mean, it's like insane.
2:41:44
>> Wait, where what facility were you actually working out of? >> Woking.
2:41:47
So, out of the McLaren Technology Center, >> which ising Yeah.
2:41:50
Like this classic summer job. Classic summer job. >> I was at 14.
2:41:56
Yeah, I was I was I was refing like 10 soccer games in every Saturday.
2:42:02
>> Not not uh I working hard but not as smart. >> Yeah. Yeah.
2:42:05
Wait, so how did you get the job?
2:42:07
>> Well, I I I built a fusion reactor um before Yeah. before the internship. So, that really helped.
2:42:12
>> Um basically, I would stay up until like 3:00 a. m.
2:42:15
Las Vegas time every night.
2:42:17
And I just kept calling their CEO.
2:42:17
I never got through to >> but after maybe the third or fourth attempt, I did get through to his personal assistant.
2:42:24
And yeah, she took some pity on me and ended up facilitating the internship. >> That's amazing. Wow. Okay.
2:42:28
Well, catch us up on Brink, uh, scale of the business, where you are, product, suite, all that. >> Yeah, 100%.
2:42:34
So, Brink manufactures drones for public safety end users.
2:42:36
We started off with this guy, which is an indoor drone for SWAT teams.
2:42:40
So, the mission of this is to take off from an armored vehicle to fly up to a target structure, look around the backyard, and then this was the first drone in the world to have a glass breaching capability.
2:42:51
So, it would literally shatter a window, make entry indoors.
2:42:52
Uh this right here is a small LAR generates about a half a million points per second.
2:42:58
So as this aircraft is clearing rooms, it's actually drawing a floor plan of the structure and then streaming it back live to first responders.
2:43:06
>> Can you tell me how it actually breaks the glass? >> Yeah.
2:43:08
So basically, it's a wheel that hangs off the front of the bird that has two tungsten carbide endectors that are embedded into it.
2:43:15
And the wheel spins up to roughly 30,000 RPM.
2:43:17
So the second >> sort of like a saw almost. >> Yeah.
2:43:22
But it causes glass to just explode.
2:43:24
Like [laughter] in particular, >> the worst nightmare.
2:43:27
>> We have to share when we were coordinating for this appearance, they said, "Uh, if you guys bring some glass to the Ultra Dome, we can smash it on set."
2:43:34
And we were like, "I don't know."
2:43:36
>> I actually broke some glass yesterday.
2:43:36
I was playing a little basketball. >> Yeah. Yeah.
2:43:40
>> So, we break glass here. >> Yeah.
2:43:41
Next time we'll have to have you bust in through the through the door, take down the steel.
2:43:45
This >> I would I would love to make that happen.
2:43:47
And yeah, this thing can also enable two-way communications, right?
2:43:49
So when it finds a suspect, it can enable, you know, a crisis communicator to actually deescalate whatever is going. >> Yeah. A hostage negotiation. >> Yep.
2:43:57
So Vegas Metro was our first customer.
2:43:59
Today about 20% of the SWAT teams in the country are actively utilizing this drug. Wow.
2:44:03
Which is something that >> What are the rest of them waiting on?
2:44:06
[laughter] >> Well, you know, a lot of SWAT teams are super small and they're like a shared effort between a bunch of 10erson police departments. Got it.
2:44:14
>> Um this is, you know, a rather premium drone, so they're not like in the direct addressable market uh for this particular bird. Yeah. Yeah.
2:44:21
>> If you're looking at the addressable market, we probably sold to, you know, 40 or 50% of those. >> Sure. Sure. Sure.
2:44:25
And and they might need uh if it's a small team, you might need an extra operator, someone who pull away from the door kicking that the rest of the team's doing. Correct.
2:44:32
Not everyone has the staff.
2:44:34
>> That's that's exactly.
2:44:34
But yeah, I mean, from the beginning of Brink, I also had this vision of drones arriving at the scene of 911 calls before first responders, right?
2:44:41
But I was familiar with how technically complex it would be to realize something like this from my time at DJI. It was my last employer.
2:44:49
And yeah, I thought building a citywide network of recharging pods that could integrate with computerated dispatch and you know enable drones to fly very reliably over people etc.
2:44:56
It was just like a little out of scope for a teenager without any money.
2:44:59
So started with this but you know a lot has changed for Brink over the course of the last 5 years.
2:45:04
Today we're just about the second largest quadcopter manufacturer in America and we are the world's largest public safety drone company and that's enabled us to yeah realize that product.
2:45:14
>> Yeah, the new when did this come out?
2:45:14
Uh huge about about a year ago.
2:45:18
Little little over a year ago. >> Oh, wow. Active. >> Yes. >> Oh, yeah. >> Yeah, for sure. >> It's okay. I'm touching. >> Oh, yeah. No, it's great. I'm glad you are.
2:45:26
So, yeah, this is really the world's first purpose-made 911 response drone.
2:45:30
So, it takes off from a citywide network of drone recharging pods mounted on top of police and fire station roofs, and it it flies to emergencies before, you know, first responders can show up.
2:45:41
And then when it arrives, it streams back feed so first responders know exactly what they're about.
2:45:45
It has an onboard thermal imager so it can see heat.
2:45:49
It can see through smoke, see hotspots and structure fires, you know, all of that good stuff.
2:45:52
Communicate that potentially to >> and I imagine uh police officers would want one of these on site even if they're are getting there first in some situation, right?
2:46:03
maybe they're witnessing something and just having that uh a third person view from the sky so that they're less focused on, you know, trying, you know, obviously they have body cams and things like that, but having that extra angle, I think, is important. >> 100%. >> Yeah.
2:46:19
How does deployment work?
2:46:19
I mean, imagine a 911 call comes in, an address is getting collected, and then at some point is like, is it, you know, does someone type the address, hit go, and then the drone can just go from an address and and and route itself, or is there a pilot that's firing it up?
2:46:38
Like, how autonomous is the actual deployment to get from the base station to an address? >> Yep.
2:46:44
So we grab addresses from computer AED dispatch or other pieces of software.
2:46:49
>> Computer AED dispatch. What does that mean?
2:46:51
>> Basically that's the software that dispatchers use to deploy ground units of various kinds. >> Got it. Okay.
2:46:57
>> But when someone calls 91, you know, the the GPS coordinate of that phone hits CAD. >> Okay. Interesting. >> Yes.
2:47:03
So we we'll grab that GPS coordinate.
2:47:05
Then we find the nearest drone to the emergency with sufficient battery state of charge to actually get there.
2:47:11
The doors on our recharging pods automatically open. We launch an aircraft.
2:47:15
Uh we plan a path from it site to the emergency avoiding manned air traffic etc.
2:47:20
And then when the drone arrives it can engage in some number of pre-programmed like on arrival behaviors like orbiting the GPS coordinate pointing its camera in a certain direction >> saying something itself or or it can then be taken over you know by dispatcher or teleoperator.
2:47:35
The drone could be repositioned camera can be moved around.
2:47:38
Maybe that teleoperator does use the drone to communicate to someone.
2:47:42
uh or they might decide to deliver an emergency medical payload like Narcan, a defibrill, personal flotation device, etc.
2:47:50
>> How does it uh how do these takeoff points, charging locations actually work when a police uh uh law enforcement agency decides or a city decides they want to set this up, are they going around and find finding local businesses and getting them to opt in?
2:48:05
Are these just like sitting on the roof of like a Starbucks or something like that? How does that all work?
2:48:09
You know, that does happen sometimes, but generally fire departments are just already in the right places in jurisdictions. Yeah.
2:48:17
Because >> So, how what what Yeah, maybe maybe it's helpful to talk about the range of this first. >> Yeah.
2:48:22
Each one of these birds can cover roughly 20 square miles of jurisdiction. >> Wow. Which is quite a bit.
2:48:27
>> So, like most cities, you actually maybe need a handful. You have great coverage. >> Correct. >> Yeah. >> Yeah.
2:48:34
>> Um, talk about the supply chain to actually uh build a drone company.
2:48:39
Obviously, you're a great engineer, but uh there's so many pieces on here uh that America hasn't really been dominant in drone manufacturing.
2:48:46
We we we we talked about GoPro and sort of the rough go that they had trying to get into the market being underpriced in many ways.
2:48:55
Like what did it take you to build the first one?
2:48:56
How did you build the supply chain?
2:48:58
How much is built in inhouse today?
2:49:00
How how are you thinking about building these guys?
2:49:02
>> Well, fun fact, Brink has been sanctioned by China twice and I'm also personally sanctioned by China. >> No way.
2:49:08
You're you're one of the guys. >> No, I am. I am.
2:49:10
>> It really is on I mean that there's a lot of lists you can get on as an entrepreneur, but none with more kind of prestige than being sanctioned.
2:49:16
I think >> I was I was proud of that one.
2:49:20
>> Ready to vacation in America? >> Yeah.
2:49:22
[laughter] Going anywhere >> 100%.
2:49:24
Um so we had to move away from a Chinese supply chain >> and I'm sure you were buying some stuff early on.
2:49:30
Okay, there's a battery buy some stuff off the shelf. Hack it together.
2:49:33
But eventually the geopolitical reality >> and you're 3D printing too. >> Uh yeah.
2:49:37
So, so Lemur does include some carbon fiber reinforced nylon uh 3D printed parts.
2:49:42
Responder though is fully injection molded. >> Okay. Interesting.
2:49:45
And so, uh, walk me through the supply chain. What are you making?
2:49:50
What is America good at making?
2:49:52
Are do we at least have a good drone motor company?
2:49:53
I've been hearing that drone motors in particular are difficult to make in America or at least a lot of the companies sort of offshored or left or went out of business. >> Yes.
2:50:03
So listen, I mean DJI controls 90% of the global drone market.
2:50:06
They're they're near it's really a monopoly.
2:50:08
I think this isn't so well understood, but like the drone industry is a monopoly owned by DJI.
2:50:13
Autel is their nearest competitor.
2:50:16
They're another Chinese drone manufacturer.
2:50:17
They have about 5% of the market. >> Okay.
2:50:20
>> Um all foreign drones were just federally banned. >> Okay.
2:50:24
I don't know if you guys have been tracking this, but right before Christmas, the the >> Wait, but but only in a uh for government buyers or all consumers.
2:50:34
>> All new foreign drones have just been banned from entering the country. >> Okay.
2:50:38
So DJI So if I go to Best Buy right now, there might be a DJI Mavic 3 on the shelf, but there's not going to be any new ones once they go out of stock.
2:50:48
>> Exact basically like the next Mavic won't be allowed into the country.
2:50:51
the next Matrice series drone won't be allowed into the country.
2:50:54
They can hypothetically continue importing their current inmarket drones. Okay.
2:50:58
But in reality, in reality, even those imports are being slowed down very much at the borders.
2:51:05
So there's there's this huge need for, you know, a DJI of the West or like a leading drone manufacturer for the free world.
2:51:11
And that's the organization that we want to be.
2:51:12
I mention I mention all of this though because >> Wait, so what does that mean though?
2:51:18
Does that mean you you start selling these to the public? consumer.
2:51:20
I want I want consumer >> I think I think over time yes we probably >> do start engaging in those types of businesses you know consumers a little far from our you know current space.
2:51:33
Yeah, but if it helps you get to scale, bring down costs, >> yeah, >> there's a potentially good feedback loop.
2:51:40
>> I think I think though like private security, industrial automation, homeland security, etc.
2:51:44
would be like more more natural immediate uh new verticals for us.
2:51:48
But yeah, I mean over time we want to be >> that was under reported.
2:51:51
I didn't I didn't catch that they were I I I remember uh I remember some news around uh foreign drones with uh within uh purchasing from the government. and it didn't clock.
2:52:04
>> Yeah, there were walk us through some of the history there.
2:52:06
There were some local bans, some state level bans, some individual agencies that might say, "Hey, we're not going to approve these."
2:52:14
Um, you heard about, you know, uh, you can't use Tik Tok in Langley.
2:52:16
That seemed obvious, but uh, now it's it's grown a lot.
2:52:20
Uh, what was the actual history of the roll out?
2:52:22
Who's who's been driving this in Washington?
2:52:26
>> Yeah, so the progression here was number one, the federal government banned itself from purchasing Chinese drones. >> Okay.
2:52:31
Uh then some states started passing similar legislation.
2:52:34
Florida, for example, banned their public safety agencies from acquiring new Chinese systems.
2:52:40
About a dozen states have followed suit.
2:52:43
>> And the new thing is what I just articulated.
2:52:45
You know, the government saying, you know what, no more new foreign drones are allowed into this country, period. Okay.
2:52:52
>> Regardless of application. >> Yeah.
2:52:53
Walk me through the geopolitical risk of of, you know, foreign drones.
2:52:55
I I at one point I had a DJI Air 2 or something.
2:53:02
This little mini 49 uh what was it?
2:53:05
490 gram or something like that. Yeah.
2:53:07
Uh and uh it was sort of like collecting dust in a in a uh in a drawer somewhere.
2:53:13
And I was thinking like okay if somebody hacked this and really tried to fly it out of its little case and out of the drawer and then out of my closet and then out in my house like what is it going to do? Is it that dangerous? child.
2:53:25
Child, John, I mean, I've always looked at this as like uh you rewind >> and uh you know, some someone in China, so some entrepreneur in China is like, I'm going to make a a hit consumer product in America [laughter] that will be able to give you a real time map of everything going on.
2:53:42
And there's going to be so many drones that people won't even notice when a drone is just hanging around some strategic asset or anything.
2:53:51
>> So, is that the risk surveillance?
2:53:51
I I would say there are three primary risk vectors.
2:53:55
Um risk vector number one is that DJI drones just stream back video, thermal imaging information, GPS coordinates, altitudes, etc.
2:54:03
to China, which >> going straight to the DJI cloud, right? >> Yeah. 100%. 100%.
2:54:08
So that's, you know, that's the first big like trunch of risk.
2:54:13
The next trunch of risk is look at what's happening in Ukraine.
2:54:15
like drones, specifically DJI drones and other, you know, aircraft that are similar are being deployed to incredible effect in the context of of warfare and they're being consumed at insane rates.
2:54:29
>> If America wanted to engage in, you know, adopting those types of drone tactics, we would need to produce many hundreds of thousands of drones a month.
2:54:37
And we just do not have that industrial capacity in this country.
2:54:41
>> If you ban foreign drones, though, guess what happens?
2:54:43
that industrial capacity gets built up because the domestic market starts to be served by scaled American drone companies.
2:54:52
>> You bootstrap like wartime demand with consumer demand today enthusiasts that want to be able to >> you know get footage of their ski trip or some you know they're hiking or any number of use cases >> 100%.
2:55:05
And then the third tranch of risk is what you articulated.
2:55:07
Um I would say though when you start contemplating systems like that >> you know that risk starts to feel much more serious >> because it might be able to take off at any time.
2:55:17
It's not >> from a recharging pod >> from a recharging pod.
2:55:19
And so >> yeah, I was surprised the what was the the operation in Ukraine where they parked next to the air base took off like that >> like I still feel like that risk >> uh people are not taking it seriously enough about that kind of event happening like on American soil. >> What was it? >> Spiderweb. >> Operation spiderweb. Is that it? >> Sounds right.
2:55:43
>> I forget what it was called.
2:55:43
Um but yeah, that was that was certainly dramatic.
2:55:46
Um, so talk to me about uh you're having success in the uh the police market.
2:55:51
Are you thinking of uh going to the federal government, the Department of War soon?
2:55:57
Uh is is there a crossover there or is that more of a distinct uh market that you're putting off for the time being?
2:56:05
>> Yeah, I mean the the way I think about things is there are 20,000 police departments in America, 30,000 fire departments, 80,000 police and fire stations.
2:56:13
In the future, I believe, you know, the top half of those buildings are going to have a drone recharging pod on the roof.
2:56:18
That's 40,000 deployment sites. Yeah.
2:56:20
We charge on the order of like 60 to $160,000 per year per launch site.
2:56:25
So, even being very pessimistic, the domestic markets around $3 billion recurring.
2:56:29
Uh international, excluding Russia, China, Iran, and all the countries that we'll never be able to sell to is a similar size.
2:56:34
It's maybe like a $6 billion pie.
2:56:36
Even if we're only successful at capturing a third of that, like we're we're a large public company.
2:56:41
Axon's probably our closest comp right now.
2:56:43
They're trading at roughly a 20x revenue multiple.
2:56:44
So like that'd be an amazing outcome for us.
2:56:46
But long term we do want to be the DJI of the west, right?
2:56:51
And we want to operate in every customer vertical where we can add value >> and uh yeah that includes you know some of the areas that you listed. >> Yeah.
2:56:59
Uh on the engineering side uh what is if you could wave your your a magic wand what technology would you want to advance most directly?
2:57:06
Is it the battery, the motor, uh the any other uh the actual sensor stack?
2:57:12
Like where are we most bottlenecked from just a technology development perspective?
2:57:19
>> You know, I would say surprisingly connectivity can be a challenge. Yeah.
2:57:20
U we're we're about to release something very innovative in that domain with our next drone. Okay.
2:57:27
>> Um but yeah, that that can be that could be a major issue.
2:57:29
Like cellular isn't always perfect, especially at altitude.
2:57:32
have I have this very very first world problem that >> on the drive home from the studio >> there's like a 10-minute stretch where there's just I cannot get a I can't have a a phone call >> phone call >> so I start a call when I'm leaving and
2:57:47
then I'm like I'm going to have to call you back >> in like 10 minutes and then I call people back and I'm like how in the middle of Los Angeles on a major like street >> do can can I not take a simple phone call >> keep in mind our drones fly everywhere jurisdictions, right? So, every city has
2:58:02
So, every city has little pockets like that.
2:58:06
>> Also, the Verizon outage yesterday, you have to be you I mean I I have I'm issues with it, but I mean there was like 30% of Verizon users, I think yesterday had no coverage.
2:58:16
Some ma massive number, mostly East Coast numbers, I guess.
2:58:20
But >> yeah, >> what about uh what about uh Starlink satellite connectivity?
2:58:25
Is that doable on a drone this size?
2:58:28
I have the Starlink Mini.
2:58:30
I could imagine the extra mini or the Nano fitting on here. Is that in the cards?
2:58:35
>> Yeah, you should you should watch our next launch event. >> Okay. Okay. >> When's when's that? >> Couple months. Couple months. [laughter] Q1. Okay. Yes. >> Um Yeah. Yeah. Interesting.
2:58:42
Um what what else goes into training uh uh police forces and uh uh and SWAT teams on using these effectively?
2:58:53
Have there been any creative uses, creative stories that you've seen where people have deployed this uh in maybe novel ways where you didn't even think, oh, they they could use it in that particular way.
2:59:03
Are there any interesting stories that you guys have shared?
2:59:06
>> Oh, there there are so many.
2:59:06
I mean, especially especially when it comes to lemur, right?
2:59:12
Um >> yeah, there there really a lot.
2:59:14
There there was one that I I watched personally where um >> like a person was kind of pretending to be not responsive. Oh.
2:59:21
Um, so the the operator of the drone actually kind of started nudging them and was able to get a response out of >> them. Interesting.
2:59:31
>> So yeah, I mean weird weird things along those lines happened just constantly.
2:59:34
We can fly this as well if you guys are are >> Yeah, that sounds great. Let's fly.
2:59:40
>> All right, >> so take off site there. >> Yeah, here we go.
2:59:45
>> There's a Diet Coke that's going to get knocked.
2:59:46
John, I'd move your Diet Coke. >> Okay.
2:59:48
I I think we're flying this one. Okay.
2:59:51
>> Uh, [clears throat] this is amazing.
2:59:52
Yeah, I couldn't supply either, but yeah, I think the the indoor drone is maybe the right we got the camera view back here.
2:59:58
>> Oh, we got the camera view up here, too. Okay. Oh, wow.
3:00:00
It's that in and everything. Okay.
3:00:03
>> Yeah, let's fly this around. This sounds great. What is happening?
3:00:06
This thing would definitely get me to comply if it was flying. >> This is crazy. Here we go.
3:00:17
>> So, we'll we'll show off a couple of functions. >> Okay.
3:00:18
Yeah, show us some stuff.
3:00:18
You know, right now we're in a GPS denied environment because, you know, we won't be able to see any satellites through a metal roof like this. >> Sure. Sure. Sure.
3:00:27
>> The drone is is utilizing its onboard cameras, running visual inertial adometry algorithms.
3:00:33
>> Yo yo, >> in order to localize, and it's also using some onboard LAR to do the same. >> Yeah.
3:00:38
>> Uh the aircraft is streaming back 4K video and thermal imaging information. Okay.
3:00:43
>> So, yeah, Demetri, you want to you want to maximize thermal really? >> Oh, the thermal. Oh, wow.
3:00:46
Those are all our thermal signatures. >> This is very cool. >> There we go. >> Wow.
3:00:53
>> And those sensors are mounted on a payload that can [music] rotate a full 180° so it can look straight up and also straight down, which is pretty operationally useful.
3:01:03
>> We also have some lights that are [music] built into our camera pods.
3:01:06
Demetri, you want to hit those.
3:01:07
>> So that's a light for [laughter] you.
3:01:11
You can barely see the >> Oh, you can strobe it, too.
3:01:14
>> And they both have strobe functions. >> Okay. Yeah. Yeah. Yeah.
3:01:15
So, uh, that's that's all.
3:01:17
>> Wow, that's fantastic.
3:01:19
>> You can see that kind of articul. >> Oh, yeah. It goes up and down. There you go. >> Great.
3:01:22
>> Uh, Demetri, you want to land it and then I can give it a quick call?
3:01:25
>> Yeah, >> that's amazing.
3:01:29
>> Give Give it a quick call.
3:01:30
>> Yeah, >> it really it really is like a creature.
3:01:34
The way the way the way >> it has it has some some gusto to it. It's good.
3:01:39
>> So, the Airframe has a cell phone number. >> Wait, really?
3:01:41
Oh, so you can just call from an actual phoneraight. Okay.
3:01:43
Don't Don't dox that phone number.
3:01:45
You're going to be ringing off the hook. >> One two one one two. >> Wow. >> Yeah.
3:01:52
This is how you know Austin negotiations are happening around the country. >> Just call the drone. That's so simple.
3:01:55
I mean, yeah, it was probably just >> It was It was the right solution. >> Yeah.
3:02:00
Just work off the default rails. That's amazing.
3:02:02
>> How on earth did hostage negotiations you if you want to turn it off and then >> There's one more thing I'll [clears throat] show off quickly which is true.
3:02:11
>> So, it's a very durable drone.
3:02:11
Yeah, >> if it ever does crash and lands on it back, it can self-right.
3:02:15
So, you'll see that >> it can selfright. >> Oh, there you go. Wow. Turtle mode.
3:02:21
>> Yeah, that makes sense. That's very cool.
3:02:23
Okay, >> that is very cool. >> Yeah, thank you.
3:02:27
>> How u question, >> how did what were the actual logistics of a hostage negotiation historically?
3:02:34
>> Wasn't a lot of megapones just screaming?
3:02:36
>> Yeah, you're yelling, but then they're trying to yell back, but they're in a house and they're trying to not be visible.
3:02:41
I can imagine it's hard to hear, makes the negotiation, >> they say, a lot harder.
3:02:46
>> I mean, that that absolutely happened.
3:02:48
Uh, a lot of instances of SWAT teams just having to make entry into structures where they didn't know what was waiting for them on the other side of the door, you know, also also occurred.
3:02:58
And that's not good for anyone.
3:02:59
I mean, that's incredibly dangerous for police officers.
3:03:01
It's dangerous for the suspects.
3:03:02
It's dangerous for civilians.
3:03:04
It might just be like generally in the area.
3:03:06
So, I mean, our thought with Lemur is why do that at all when you can send in a little drone to clear all the rooms, find suspects, you know, enable negotiation.
3:03:16
Hopefully, that just resolves the situation.
3:03:18
But even if it doesn't, at least now first responders know, you know, what's waiting for them and they can put together a plan that takes all that data into account. >> Yeah. Yeah.
3:03:26
What are the economics of the first responder units that you work with?
3:03:30
Are they uh are they wary about capex?
3:03:32
Do they want more of subscription product with services and uh and they get regular updates?
3:03:37
Do they just want to pay one time and then you get out of their hair or what what's what's the correct business model for this?
3:03:44
>> Yeah, I mean in general nowadays we're selling full-blown drone programs >> programs.
3:03:49
>> So that that might include some number of indoor drones, some number of standalone outdoor drones, and also >> you know jurisdictionwide 91 response drone coverage.
3:03:59
Uh, in year one, we deliver all of our current state-of-the-art hardware.
3:04:03
So, an agency would get like Responder 1. Then at year 2.
3:04:06
5 of a contract, we automatically upgrade them to Responder 2.
3:04:09
Same thing happens at year five.
3:04:11
If a drone ever gets damaged or destroyed over the course of those 5 years, we'll repair or replace it. We include data storage.
3:04:16
We include unlimited software licenses for pilots and viewers.
3:04:20
We include regulatory assistance with the FAA.
3:04:24
Everything they need to run their full drone program. >> Yeah.
3:04:26
>> Yeah. uh how have you been processing the advancements in AI over the last couple of years like what's been useful like we have better video models we can understand images at the same time like >> you know the the the baseline is like a megaphone so this is a huge upgrade and
3:04:43
uh and you might not be able to do ondevice inference there I don't know if there's an H200 in there or something like that right uh so yeah where where's AI being helpful where's it being useful where has it been okay wait and see >> so our drones won't even take off without utilizing some of those techniques. >> Um, you know, when you have a strong GPS
3:05:00
>> Um, you know, when you have a strong GPS signal, you can mostly rely on that for localization, especially if your aircraft has, you know, a GPS RTK system.
3:05:08
But GPS isn't always perfect, like when we're flying around in this structure, right?
3:05:12
Or if we're flying near a big building or under a tree, you do need like redundant localization systems.
3:05:18
Um what we've implemented to solve that problem is a vision system that you know relies on those sorts of techniques in order to pick out tracking points and you know to to calculate relative velocity.
3:05:30
So it's really, you know, pretty fundamentally baked into our product at that level and at higher levels that, you know, touch end user >> app. Yeah.
3:05:37
Because I mean, one of the most obvious use cases just break a window, go into that building, find a person, and then I want to talk to them on the phone and that's [clears throat] and that's it.
3:05:46
And and and maybe I can't get the video feed out because the connectivity is difficult, but if we can at least maintain a phone line, Yeah.
3:05:51
we can have a conversation and uh progress can be made.
3:05:56
Hopefully people can be saved. >> Yep. For sure. >> Fantastic.
3:05:58
any predictions on how drones will be applied uh in wildfires and just firefighting broadly?
3:06:05
Is that something you guys touch yet? Would you ever touch it?
3:06:08
How are you thinking about that kind of >> Yeah, I'm I'm absolutely thinking about that space pretty seriously.
3:06:11
Um >> drones drones can add value in a number of different ways.
3:06:16
Uh first of all, they can help out with wildfire detection very early on.
3:06:20
You know, it's it's possible to put a drone recharging pod in an area that has a high wildfire risk and then just have it fly around.
3:06:26
There be like solar panels powered.
3:06:27
Yeah, you think totally 100%.
3:06:29
And and likely, you know, a Starlink in back hall for for connectivity. >> Okay.
3:06:34
>> Um >> yeah, some of the footage that came out of the LA wildfires was so bad.
3:06:37
Like you would I would see some of these cameras and it looked like a it was a camera that was a potato.
3:06:45
>> No, we only got drone footage days later.
3:06:48
>> And you'd be like And yeah, and it would be like, okay, there's a tiny speck of smoke here.
3:06:51
And it's like how how is that like the best that we have when it causes tens of billions of dollars of damage? >> For sure.
3:06:58
Drones can also be used for logistics, you know, moving around chainsaws and that kind of stuff in areas that, you know, are are just difficult to traverse with conventional vehicles.
3:07:08
And I think in the future, drone swarms will be used to actively fight forest fires. >> Yeah.
3:07:13
>> Yeah. just drop a ton of material all over the place on or even I think uh when even even for like ember detection and like putting out like cuz obviously when some of these wildfires start >> they're they're uh the the actual fires
3:07:29
happening here embers are floating kind of randomly with the wind and then there's a moment where like if you just had like effectively a fire extinguisher that could for a second just like hit a certain spot you could stop like a bunch of structural loss back to this guy. Uh what what what's
3:07:44
Uh what what what's the decision to have the white posts come up on the back rotors and then go down on the on the front rotors? >> Yes.
3:07:54
So, um those cans on the back of the drone are actually are GPS RTK antennas. >> Oh, interesting.
3:08:00
The motor is actually just here. Yes. Okay. These are antennas. >> 100%.
3:08:04
And they need a field of view of the sky in order to see. Yeah. Yeah. 100%. Interesting.
3:08:09
So yeah, those two things are antennas.
3:08:12
Um, we've embedded antennas on the front two motor pods as well for a mesh networking radio.
3:08:17
And then you see those two little wings coming off like the Yeah. Yeah.
3:08:21
Those those are actually our uh LT antennas. >> Very cool.
3:08:27
>> And it's it's generally good practice to separate antennas on drones as much as humanly possible to avoid cross talk.
3:08:33
And that's why we engineered this configuration.
3:08:36
>> Well, congratulations on all the success and uh >> amazing update.
3:08:38
This has been the most wild uh inerson interview ever >> we've ever done.
3:08:44
Let's glass break next time. >> Yes. Yes, we should.
3:08:46
We will definitely get some smash it.
3:08:50
>> That is by far the coolest demo. I >> bet. I bet. >> Fantastic.
3:08:54
Well, thank you so much for coming on the show.
3:08:56
>> Congratulations on the progress and we will talk to you soon.
3:09:00
>> Um while he's walking off, let me tell you about Phantom Cash.
3:09:02
fund your wallet without exchanges or middlemen and spend with the Phantom Card.
3:09:07
And I'm also going to tell you about Gemini 3 Pro.
3:09:11
It's Google's most intelligent model yet.
3:09:13
State-of-the-art reasoning, next level vibe coding, and they got deep multimodal understanding over there.
3:09:19
Jordy, is there anything else in the timeline that you think we should get to?
3:09:23
The one thing that I have is that uh we have some breaking news that uh Doug Olaflin over at semi analysis has severe LLM psychosis. >> He's been oneshotted.
3:09:35
He uses claude everywhere and uh anywhere and everywhere including a client happy hour at 6:50 in New York City.
3:09:42
Uh and uh and Doug says, "Absolutely.
3:09:47
You've met me at a very Claude code time in my life."
3:09:50
Uh, I listened to him uh on China Talk or on uh uh sorry uh on a podcast with Dylan Patel and Jordan Schneider from China Talk um Transistor Radio.
3:10:02
And uh he was uh obsessed with using Cloud Code to organize his notes, write markdown files, orchestrate his entire life.
3:10:11
He says everything is a skill issue.
3:10:13
AGI has been achieved and he's very excited to be uh using Agentic coding agents everywhere and always.
3:10:23
>> Last thing we need to cover is the PBR 99 pack.
3:10:30
>> What >> that has been released.
3:10:32
>> They launched this during dry January. What a wild move. >> Zigg when they zag.
3:10:36
The new 99 pack wraps 99 PBRs in a gigantic allnew original illustration featuring characters from the Godzilla universe.
3:10:45
I mean, this collab put on like put above your fireplace, right?
3:10:50
I'm sure >> uh I'm sure all the wives out there will love with and the husband comes home with the 99 pack and puts it, you know, 99 bottles of beer on the wall. 99 bottles of beer.
3:11:02
You take one down, pass it around.
3:11:04
98 bottles of beer on the wall. >> They did it.
3:11:06
Um, and they, yeah, they did it. Uh, they did the meme.
3:11:08
But, uh, yeah, congrats to the team at PBR over there. They're doing stuff. They're innovating.
3:11:14
Well, that's our show today, folks.
3:11:17
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3:11:17
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3:11:27
We have our friends from Sequoia popping on.
3:11:30
Got the founder of Athletic Brewing. >> Oh, yeah.
3:11:34
We have some athletic brewing over there in the refrigerator.
3:11:38
>> And of course, we'll have the mansion section.
3:11:41
>> The mansion section tomorrow.
3:11:42
>> Thank you so much for tuning in.
3:11:44
>> Have a wonderful great rest of your day.
3:11:46
>> We'll see you very soon. >> Goodbye. is win.