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7:12
Today is Thursday, April 24th, 2025.
7:15
We are live from the Temple of Technology, the fortress of finance, the capital of capital.
7:22
We got some new uh sound effects today. We do. So, I'm very excited. Expect the unexpected. Expect the unexpected.
7:28
We got a lot of uh great breaking news.
7:32
Netflix had earnings and they recorded record profits. Let's hear from Netflix. It's fantastic.
7:37
From Bloomberg, Netflix Inc.
7:41
reported record profit to start the year, allaying concerns of a slowdown or fears the streaming leader might be hurt by growing economic uncertainty.
7:50
First quarter earnings rose 25% to $6. 61 a share.
7:52
The company said Thursday, easily beating analyst estimates.
7:58
It's bad day to be a Netflix analyst.
8:01
You're just getting beaten up by the corporate results. Uh sales grew to 10.
8:06
5 billion in line with projections.
8:09
The results were boosted by a recent price increase and strong slate of programming across the globe like the UK sit series Adolescence.
8:14
Investors have come to see Netflix's safe bet during a great time of economic uncertainty and challenges for conventional movie and TV business.
8:23
with global audiences of more than 700 million viewers.
8:27
The company said it has seen no impact on its business from President Donald Trump's tariffs or the market volatility that has followed.
8:32
And so this is interesting.
8:35
Congratulations to all the Netflix shareholders.
8:38
Congratulations to everyone at Netflix.
8:40
Uh but I thought it was interesting because uh you know we've been we were talking earlier about like we saw the stats on all the different tech companies how much they're off peak from the start of the year. Yeah.
8:51
And even Meta's down 25%.
8:53
And we were kind of working 28% over over their over the last uh 12 months. Yeah.
8:58
And we were kind of working through it.
9:01
We were like, "Okay, how did we get to this point?
9:04
How how is Meta affected by tariffs?"
9:06
Like, they don't make stuff in China.
9:07
I mean, I guess they do make the Oculus, but they're not selling that many of them.
9:10
Um, but in general, you know, the question was, why is Meta hurt by tariff uncertainty or or the chaos of of the the last few months?
9:16
And you know, you can kind of talk to Sean Frank over at Ridgewallet and say, "Okay, well, you know, if DTOC advertising that's happening on Meta is impaired by tariffs, they could pull back on advertising."
9:29
And so, you can get there.
9:31
But with Netflix, like there truly is nothing that affects them on the tariff side.
9:35
Like, they truly are just a digital content uh farm basically.
9:36
Uh yeah, the the economy would have to be pretty bad for people to start thinking, I want to be less entertained. Yes. Exactly.
9:48
And uh historically uh things like Netflix have done very well during economic downturns. Yep.
9:53
Because things are rough, but you want to kill some time.
9:57
And on a dollar per hour basis, Netflix is probably the best.
10:00
The usage metrics are still insane.
10:02
People say TBPN, you guys put out three hours of content a day.
10:08
Well, Netflix three hours of content every minute. Yeah.
10:11
Well, well, and and if you look at I think some of their usage numbers, I think it's like the average users using it for like two hours a day, which is just insane. Yeah, it's crazy. It's crazy.
10:20
I actually think we should distribute on Netflix. Absolutely. Probably. Yeah. Give us a call. Netflix.
10:25
Read read Hastings if you're listening. Come on.
10:28
We'll fly up to Los Gatos. Yes. Yeah.
10:31
I'd love to partner with them.
10:31
Um anyway, interesting uh development.
10:35
Couple years ago, there was this customer segmentation push.
10:37
They went for higher tiers.
10:38
They will charge you an arm and a leg for 4K streaming across a bunch of devices.
10:42
If you're if you're sharing the passwords, they they they crack down on the password sharing. Yeah.
10:47
Uh and they also introduced the ad supported tier, which isn't free.
10:50
You still have to pay for it, but it's gener it's working basically.
10:54
And that's driving platform growth, higher engagement beyond raw subscriber counts.
10:59
Um and really they're price discriminating, right?
11:01
It used to just be oh Netflix, it's like 10 bucks a month for everyone.
11:03
Well, there are some people that are willing to pay more for 4K and more screens and whatnot, uh, and no ads.
11:09
And then there's other people that, you know, are more price sensitive.
11:12
And so they've done a great job at this.
11:13
Um, and, uh, they've basically, so they're, they're their target for 2029 is to double revenue and expand margins.
11:21
We love doubling revenue and expanding margins, folks. It's fantastic. Don't care. Overnight success. Yeah. 2029.
11:28
I mean, it's been a 30-y old business at this at that point. Uh, pretty wild. 30 year old overnight.
11:35
It will be it's possible. It's possible.
11:37
Um and so uh they're they're pivoting the strategy.
11:39
The company is moving beyond simply adding subscribers to maximizing revenue per user via segmentation by introducing ad supported tier and multiple price points.
11:46
Netflix can capture price sensitive users and retain them with a cheaper adbacked option while raising prices on standard and premium plans for those who value an ad-free experience.
11:55
That would be a lot of folks.
11:58
Uh thisation I would expect our I want to pay more and get more community to yeah want to pay more and get more ads.
12:05
So hopefully they they recognize that tier as well. That tier as well.
12:11
Um so uh let's break it down.
12:14
Ben Thompson's analysis of Netflix's Q1 2025 results underlines the robust financial performance and ambitious growth pans.
12:20
Record quarterly profits, $10.
12:23
5 billion revenue beat expectations aided by recent price hikes and popular content releases.
12:27
Uh notably Netflix ceased reporting subscriber additions this quarter.
12:31
That'll frustrate a lot of analysts because everyone always likes to have as much data as possible to project these things.
12:37
And a company that was adding a ton of users would probably want to include that data. Yes.
12:42
But there was also a very like when you would dig into the subscriber additions, you would see weird things like, oh, they're growing a ton of subscriber additions, so maybe the stock should go way up.
12:54
But then you'd find out that they were in uh lowerpriced markets.
12:56
And so there was there were all these anomalies where they were doing okay in the US but they were growing a lot in Middle East Africa and Asia and all of those have very different economic impacts on the business.
13:08
And so uh Netflix is saying like hey we're a mature company we're like 20 years old at this point um why don't you guys just focus on revenue profit and cash flow uh which we love.
13:18
And so internal forecast oh and this was interesting.
13:20
There was actually a leak to the Wall Street Journal show uh that Netflix is aiming to double revenue to 78 billion by 2029 and even target a1 trillion market cap.
13:31
And now there was a recording of uh I believe the CEO on the earnings call saying like, you know, we have a very high trust environment here at Netflix.
13:39
You know, we we we share a lot of information with our entire team.
13:43
Sometimes that gets leaked to the press.
13:44
We don't like when it gets leaked to the press, but you have to wonder if it's an intentional leak, right?
13:48
because it's like, you know, like we we have that internal forecast of of our our streaming hours going to 40 hours 24 hours a day, trillion dollar market cap, you know, hundred billion dollars in in in ad deals.
14:00
Uh and it would be terrible if that leaked, but uh but you at the same time you could imagine a situation where we would, you know, accidentally intentionally leak that just to make us look better.
14:11
And so maybe that's what's going on here. I don't know. ask him.
14:14
But, uh, you know, it could be it could be bad to have that. Yeah.
14:17
That Jamie Jamie Diamond audio leak.
14:18
Remember we talked about this where he's sounds like a great leader, you know, ambitious and wants to, you know, push his team to be their best and work hard. Yep.
14:27
Uh, what a terrible leak.
14:29
And so, they're going to they're going to roll out more new monetization streams, grow their advertising business that's projected to be 9 billion a year by 2029 and continued price increases alongside a moderate rise in subscribers.
14:42
So they basically hit saturation like everyone has Netflix that is interested.
14:45
They're not really interested in in bringing new people on and that's probably the what's going on with the with the app one deal that we discussed earlier.
14:53
Um and so uh they're basically saying that like we are confident in economics of scale and we're going to just uh you know focus on monetizing our audience more significantly.
15:04
Uh has kind of dropped out of the big tech uh narrative.
15:07
You know, it used to be Fang. The N stood for Netflix. Now we're on.
15:12
We've moved on from Fang. We're on Mag 7. Tesla's in.
15:17
Uh well, it's hard to call a $500 billion company big technology, right? Yeah. It's not It's quaint.
15:23
It's quaint quaint quaint tech.
15:25
A quaint lifestyle business for sure. Yeah.
15:28
More much more of a lifestyle business.
15:29
Anyway, um, and it's amazing that a business like this can, uh, you know, have reached sort of full market saturation and still trade at almost a 50x PE ratio. Yeah.
15:40
Like, got to give them credit for that.
15:45
They got destroyed during, didn't they get destroyed during COVID or something?
15:48
At some point, like they had some major major draw down in the stock.
15:51
Um, but I actually remember back in high school, um, I got in a kind of a drunken fight with a high school friend, uh, late night once about whether or not Netflix was a good stock. This is very funny.
16:07
Not super on brand for you, I'm sure.
16:09
Well, this is high school, you know. Oh, okay. It was in high school.
16:11
I thought you were saying it was recently.
16:12
No, no, no, no, no, no, no. This was back. This was back.
16:16
So, you were 21 when you were in high school, to be clear.
16:17
You got held back a little bit. Yeah.
16:19
Uh but this was this is probably you know around 2007 something like that. Okay.
16:24
And so you were feeling the heat from from the financial crisis. Yeah. Oh for sure. For sure.
16:32
But my basically my friend was like was like Netflix is like overvalued.
16:35
Like it's not a good stock.
16:36
And I and I was just like and and I laid out like no like I think in the future like you will have Netflix like maybe even on your phone.
16:42
Maybe you' have it on multiple screens.
16:45
And he was like no like this is like a terrible stock.
16:48
like it's not going anywhere.
16:50
And then it became like the the best stock of all time and I should have bought it instead of just like, you know, arguing with him. But uh but it's fine.
16:56
Well, you also should have angel invested in Coinbase and a bunch of other companies in your YC batch. Yeah.
17:01
If they if they accepted uh credit card debt as collateral for angel investments, I would be doing very very well.
17:11
I I had negative net income or negative net worth.
17:13
Anyway, um so they're trying to aim for 36% subscriber growth.
17:19
They're trying to hit 410 million users by 2029.
17:22
Um and Arpoo should rise significantly through segmentation, ads, higher pricing.
17:26
Uh they're they're going for that one trillion market cap. You'll love to hear it.
17:31
Um they're just just a easy 2x, right? Yep. They're only Yeah.
17:37
I mean, that actually isn't that crazy on a fiveyear plan to double.
17:38
Like that doesn't seem that crazy.
17:42
Um, but they got to get more people.
17:44
Um, and so, uh, yeah, the the the takeaway from Bened Thompson is that, you know, he was advocating for an ads tier for a long time.
17:52
He's called it a success, even if the ads aren't material yet.
17:55
Um, it it is putting them on the path and there was a lot of uh of work that they needed to do.
18:02
At one point, they were there I don't know if they actually landed with Microsoft, but they were thinking about partnering with Microsoft to do kind of the backend ad exchange.
18:07
Um, and there was a lot of No, and the bull the bullc case for Netflix's ad product, as far as I know, is just the targeting potential and Netflix's ability to like basically um verticalize from the content to the user to the to the users's interests.
18:27
It certainly should be more targetable than just over the air or not over the top but like over the air uh uh TV ads, but um I don't know that they have that much data.
18:41
I mean, if it's like this person, it's nowhere near as much as an Instagram where, you know, you're following all these things.
18:46
They know where you are on the web.
18:47
They know what you're what Oh, you're you're you're clearly shopping for a you know, suitcase this week because you've been you've been hovering over the suitcase content that we've been sending you randomly.
18:58
uh much harder to do that.
18:58
So, I think that's why there might be a benefit to to partnering with an ad exchange that has a little bit more tracking information.
19:05
Um, but still, I mean, you you can probably tell just you can probably do more segmentation than in a normal uh in a normal uh linear TV context.
19:16
Um, but it doesn't seem anywhere as efficient as meta.
19:18
But, um, sure, but that's not the point, right?
19:22
These are going to be brand marketing dollars, I think. So, that's okay.
19:23
And there was a big there was a big debate over like when Netflix first opened uh the the floodgates of ads, they were going to get a lot of experimental budget because it's very interesting.
19:34
Oh, I could put my brand next to some prestige TV potentially on Netflix or something.
19:39
That seems interesting, but ultimately the ad buyers were going to just want to see results and it's hard probably harder to track if you're just showing someone an ad and then they're not necessarily clicking through.
19:49
It's more brand advertising.
19:51
So, um, all that attribution could be difficult, but it seems like even though even in the face of all of that, like ads are just such a great business that it's working. Yep. Very interesting.
20:02
It's interesting to think about mobile watch time too, right?
20:05
Um, it's not doesn't feel as common for people to be watching television. Yeah.
20:10
For that, you could actually have a popup adirect instead of like the QR code on the screen, which I don't think many people are doing if they're watching Netflix like on their TV late night.
20:19
A lot of people are just like going around with their phone doing their, you know, chores and then watching Netflix in the background. Interesting.
20:26
Anyway, uh Dylan Patel over at semi analysis has a great breakdown on AMD's transformation and how they are trying to beat Nvidia. Uh this is AMD 2.
20:36
0, Oh, a new sense of urgency and it's a very interesting deep dive into how uh the these big companies are interacting with the next generation of analysts like Ben Thompson and Dylan Patel.
20:50
And so, uh Ben Thompson's been, you know, advocating for different strategies at Intel and and many other companies.
20:57
Um but there's always been a question of like, oh, is he like an armchair quarterback?
20:59
Like, does he really could he possibly know better than like the entire Intel executive team?
21:04
And seems like maybe now it's yes.
21:06
Um but with AMD like and semi- analysis the answer is like absolutely.
21:10
Um because uh semi- analysis back in December of 2024 about four months ago they published an article detailing mediocre AMD software and lack of usability.
21:21
This was something that had been flagged by George Hotz before basically saying that like the chips themselves on a flop per dollar basis are quite competitive with Nvidia, but the software in infrastructure on top like the middleware that goes in between like the model that you're trying to train and the actual silicon is bad basically.
21:42
I don't know how to put it nicely.
21:43
Um so but Dylan is saying that AMD has turned it around.
21:47
kicked it into high gear and they've made rapid progress in the last four months on many items.
21:53
Semi- analysis laid out they view AMD's new sense of urgency as a massive positive in its journey to catch up to Nvidia.
21:59
AMD is now in wartime mode.
21:59
Uh but there are still many battles ahead and so founder mode for sure.
22:07
Switch your business to ramp. com.
22:10
Are those connected somehow? They are.
22:12
So the RAM ad just plays every time we play founder mode now. Thank you, Ry. We have two versions.
22:18
So, basically, I mean, everyone knows that Nvidia has like completely run away with the data center uh game for AI training is especially on the on the pre-training side, there's some stuff that you can do on the inference side once you've trained the model and distilled it.
22:31
But when you need a huge cluster of 100,000 GPUs, the game is Nvidia to Jensen.
22:36
And yeah, and you've seen you've heard these stories about like Elon and Larry Ellison getting dinner with Jensen and being like, give us the give us all the chips.
22:45
And then obviously every other big tech company wants the Nvidia chips.
22:47
Nvidia stock has been mooning and all of that is because of the CUDA ecosystem that sits on top of Nvidia and how reliable those chips have been because when you're running a really big uh really big and expensive training run, one little flaw could cost you a lot.
23:02
It could throw the throw the training run off.
23:05
And so, um, AMD has an equivalent of CUDA, I believe, uh, ROCM, Rockm, uh, software and developer tools, but there's still a bunch of software gaps, scaling challenges, and a need for communitydriven breakthroughs.
23:18
That's what has made Nvidia so strong.
23:20
They have an ecosystem of developers who build software and test suites and all sorts of open-source stuff.
23:27
Uh, and there's a bunch of interesting anecdotes here about what made Nvidia really so dominant that we should go through.
23:35
So, basically the takeaway is that AMD is in wartime mode.
23:39
Uh, and it's very cool like Lisa Sue actually met with semi analysis after they published the December AMD article and acknowledged many of the gaps in the software stack.
23:52
And they've done a bunch of other things.
23:53
They hired a developer relations uh ZAR.
23:55
uh ZAR. uh this is the Devril function to actually interact with uh external developers and they do this on tech Twitter and at at at real life events like this is actually where it's happening um and in January AMD recognized that external developer community are what made CUDA great and so it's a very big pivot from the
24:13
previous comm strategy which was never admit that there are any flaws in the software public always claim victory always claim victory now they are coming from it with uh coming to the to the market with a much more humble approach and I think it's been very well received and so um am AMD has shifted into high gear to compete in AI. They know that
24:32
They know that there's a lot of money at stake.
24:34
They're overhauling the culture and software stack with a focus on developers.
24:37
Um they've done they've already rolled out uh you know massive improvements to um their software stack.
24:44
Um and they have this new uh developer first strategy.
24:46
Um they're addressing long-standing issues from poor Python tooling to slow multi-GPU communication.
24:53
So there were actual points in the software stack where there was no Python library like you could not you could not write Python to do something you had to go to a different language and that's obviously a point of uh of friction for developers.
25:06
If you have a developer who loves writing Python and then you're like actually to do this thing you have to write something else maybe C++ or something.
25:13
The key here is that all the big potential customers and existing customers value speed above you know pretty much anything else. Absolutely.
25:21
If these people are getting paid, like you want them just to move as fast as possible. Totally. Totally.
25:24
And Elon doing the new um uh data center and and whatever it was, was it a year that they pulled it off? Uh yeah. Yeah. Yeah.
25:31
It's like they're not going to wait around uh for an inferior solution. Yes.
25:35
for an inferior solution. Yes. Dylan actually highlights the X AI team catching up to the frontier so quickly as an example for what how M how AMD should be thinking like like they should think hey we are behind but if we are realistic about that and we sprint and we change the culture we could
25:55
potentially catch up to the frontier very quickly which is very cool um and so um the uh there's plans for a community GPU cloud which uh anyone could use to train uh Google had a great example le of this uh where there was this open source GPTJ moment which I wasn't I I I like heard about a long time ago but I didn't know the full story. Basically there was like a high
26:15
Basically there was like a high school kid who got access to for free to a cluster of TPUs on Google's cloud.
26:22
So they're free, but it was a very powerful cloud.
26:28
And he trained a a a language model, an in LLM that was roughly equivalent to GPT2.
26:34
And everyone was like, this is incredible if like some random kid can just build something that's like at at the same level as OpenAI.
26:41
This is like a testament to like how awesome Google is with their TPUs.
26:46
Um and uh and and and same with uh with Nvidia does the same thing.
26:49
Nvidia actually gives out servers to universities and some of them I I don't know if this is actually important at all but they're goldplated.
26:58
It's just like it's just like I think it's just to make a state I think it's just to make a statement just to be like we're delivering this thing. It's awesome.
27:05
Like we want you to be excited to build on Nvidia.
27:07
So we're delivering you a gold player.
27:09
probably spend your annual uh tuition as a college student just on energy for that free on that free Nvidia GPU rack if you were aggressive enough. So uh put it to use. Yeah.
27:20
Um and so um basically it's all it all comes down to like this cultural transformation but Lisa Sue has acknowledged the company's software shortcomings and AMD is now in wartime mode fixing bugs and engaging developers.
27:34
The company has launched developer relations initiative and uh they're increasing the R R&D budget, boosting AI engineering compensation and scaling internal GPU C uh clusters.
27:42
Um and so there there's a couple other interesting things in here.
27:48
They're focusing on continuous integration and whatnot.
27:52
Um catching up on tools and libraries, more Python support, um and uh and really focusing on uh cluster scaling, which has been a big problem.
28:03
Uh, where is the I need to find the the story about George Hots because that was interesting. Gio. Uh, let me see. Gio Hods. Let's see. Um, okay. Um, so, um, let me see.
28:20
Uh, found a post on Hacker News from four months ago from somebody saying, "Is there no hope for AMD anymore after George Hots gave up on AMD?
28:30
I feel like there's no realistic chance of using their chips to break uh CUDA dominance. Yeah.
28:34
So, um so here's here's some from the actual uh semi- analysis article.
28:41
Although George Hos could have settled for AMD's earlier offer of cloud hosted MI300X systems with full BMC access.
28:48
He insisted on physical hardware so he could hack the metal directly.
28:52
And so uh George Hos was saying like like we need an alternative to Nvidia.
28:56
We need to break the Nvidia monopoly.
28:58
break the Nvidia monopoly. this was something that he was he was pushing for and he wanted to develop a new like pietorch competitor basically for uh training machine learning models on on AMD hardware but he was running into tons and tons of problems uh with the software stack and he was posting about
29:19
these and he said like hey if you guys just send me the latest and greatest I want to be able to hack them uh but I don't want to pay because I'm doing your job for you basically Uh, and AMD initially boked even though HOTS's goal was to help open source tooling on their GPUs, which is exactly something like Jensen would jump at. Jensen knows the
29:36
Jensen knows the value of the open source community on top of CUDA and Nvidia.
29:40
And so he's he's given stuff out all over the place.
29:43
But AMD, that wasn't in their culture.
29:45
And so the stalemate turned into a public spectacle when the widely respected PyTorch co-creator uh tweeted in support of George Hots receiving the physical boxes which is interesting because like PyTorch obviously it's a it's an open source library but like it he's kind of creating this competitor with Tiny.
30:02
Um but obviously the the PyTorch creator just wants cool and efficient AI training software to go out there.
30:09
And so, uh, he says, "Sumoth Chintala says, uh, for what it's worth, if George Hots was offering to work on my stuff for free and wanted two boxes, I'd drive them out to him myself."
30:21
Tiny is a beautiful, phenomenal piece of software in my opinion.
30:25
Tiny has uh some sort of limitation.
30:29
I think I think George Hos is trying to keep it under a thousand lines of code or something.
30:32
And so it's this like remarkably, you know, optimized and and interpretable uh yeah program for uh training AI models on uh on on uh on GPU hardware.
30:45
Um but he ran into a bunch of problems with AMD and started pushing them.
30:52
And so, uh, semi analysis says, "We believed that this nudge worked."
30:56
And a George hot March 8th blog revealed that AMD had relented, sending him two MI300X boxes.
31:02
With this, AMD finally passed the GeoHT's cultural test for AMD.
31:08
This is arguably a bigger reputational coup than a technical one.
31:14
Shipping real silicon to a high-profile hacker signals a newfound developer first ethos that marketing dollars alone can't buy.
31:22
And it finally turns a bruising Twitter saga into a story demonstrating AMD's new developer first ethos.
31:30
In addition to sending Geios boxes, we believe that AMD can also score another easy reputation and marketing win by donating physical AMG AMD GPU boxes to academic labs.
31:38
Jensen and Ian and Ian Buck has had a long history of donating GPUs to academic labs going back as far as 2014.
31:46
This year um this year Jensen continues to support academic labs such as uh Carnegie Melon, Berkeley, UCSD and others for some time by donating physical goldplated B200 boxes to them in addition to providing free cloud access to Nvidia GPUs.
32:04
So he's just like you can use the cloud for free, you can have the boxes for free.
32:10
We just want you anything. Yes, 100%. It's amazing. Um, yeah.
32:14
So, uh, interesting to follow what's like the the the the change in management.
32:20
Like this is something like, you know, a going direct type of change.
32:25
Like this is a big change for the for the company culture.
32:30
But I think that they finally realized that like it had to be done because they'd done they done so much right on the actual um they' done their job on the chip side and they built a great product but it was not getting adopted and it was because of the lack of of focus on nurturing the open source community building developer relations and actually um making it easy to work with their product that they made. Um, but it's different.
32:57
You know, I don't think I don't think this is the same dynamic with um I don't think it was the same dynamic in gaming.
33:03
I think gaming was much more simple and much lower stakes.
33:06
And so if you have a shader that doesn't run perfectly, uh the gaming company will just kind of figure it out. It's not that big.
33:13
Whereas if uh if a training run goes wrong, that's, you know, potentially like a billion dollars out download drain.
33:18
It's just fascinating that Lisa and Jensen could be cousins and she wouldn't pick up at least a little bit of what her uh of her cousins moved.
33:30
So, I invited Dylan Patel on the show. He's traveling.
33:31
He should be joining us in a week or two hopefully.
33:35
Uh and I definitely want to know, you know, this is great. I love this. Let's go for AMD.
33:39
I'm super happy for them.
33:39
Uh and and congratulations to Semi analysis for like making this happen.
33:44
Uh at the same time, like why did it take so long?
33:47
like this feels like this was foreseeable.
33:50
They potentially missed out on a a part of the bubble, right? We're in a bubble.
33:55
We love bubbles on the show.
33:58
Uh but they they were pretty much asleep at the wheel for at least the initial run, which cost them uh a massive amount.
34:06
You know, they they could have raised Yeah.
34:12
tens of billions of dollars of of uh cheap equity through that process and and um you know I'm sure they they conducted you know a bunch of different um you know fundraises over that period but um they didn't really get uh much of a you know the stocks up like 60% over the last like five years so it's not like they haven't really been a winner in the in the boom. Yeah.
34:35
Well, let's put up the guest lineup for today.
34:37
And we have Delion coming into the studio first.
34:45
And we have a bunch more folks.
34:48
We got uh co-founders of public coming in.
34:50
Uh they announced a partnership with uh Aston Martin today.
34:53
We're very excited about got Listen Labs, Free Form, Formic, and of course Cali coming in from Trummed to talk about uh food dye bands and a bunch of other stuff.
35:04
So very excited for that.
35:07
But next up we have Delian. Welcome to the stream. How you doing?
35:13
[Music] Welcome Delta V with Delian. What is up? I think I lost a button.
35:22
I think I I think you just got excited when you saw me. It's okay. It happens. I did. It happens.
35:26
Uh it's not every day you get to hang out with one of the most cutthroat venture capitalists in Silicon Valley.
35:31
Now space men in the world.
35:31
Uh, the Bulgarian bruiser in the building. How you doing?
35:37
Uh, what is it like being down to one job?
35:40
I fantasize about, you know, only having one job all the time, but somehow stuck with like five jobs. Yeah.
35:46
Has anyone told you about like the value of focus?
35:47
Maybe you should just focus on one thing. I know. I know.
35:48
I wish I was a little less ADD. Yeah.
35:51
Uh, anyway, what is on your mind?
35:54
I'm sure you're thinking about Hill and Valley.
35:56
I want to pull up the uh Wait, first I have a question.
35:59
You said you said your your Zoom uh you're doing a lot less Zoom since moving to LA.
36:03
Is that just a lot you're just meeting with the Varta team in person or is it founder meetings as well?
36:09
Are you taking more meetings in person uh now that you're uh Gundo adjacent? Oh god.
36:14
Uh you know, let's not use that word. It's a dirty word. Um I am Elsa Gundo.
36:18
Uh not adjacent within um I'm currently, you know, located within those city boundaries.
36:23
those city boundaries. Um I think it's honestly it's a it's basically everything like everything from the portfolio companies um to you know FF meetings um you know to you know Varta meetings and it's one of these things that it kind of feels like recursive
36:36
where it's like when you have less Zooms then when somebody like I had this like VC ask me for a Zoom this week and I was like cool you're in SF just let me know next time you're LA like if it's so important just like take the minute flight and they're like I don't have any plans to be in LA anytime soon. And I And I was like, "Cool.
36:50
Then I don't have any plans to talk to you."
36:55
Moged talking about this. It's ridiculous.
36:57
Well, we appreciate you joining this Zoom uh and this show.
36:59
Uh let's Yeah, thank you.
37:02
We appreciate uh let's run through uh Hill and Valley over a few short years.
37:07
We've made it into the preeminent forum for the top technology leaders and elected officials to gather.
37:13
Uh you you barely scrapped together a single notable name, but somehow Jensen Wong, Alex Carve, uh you got a ton of people here.
37:22
Uh maybe walk me through uh you know who you're excited about.
37:26
Give me the give me a little bit of history and then I want to talk through some of uh what what message tech is trying to send to DC these days. Yeah.
37:34
these days. Yeah. Yeah, I mean the you history of Hill Valley it started off with like an intention of being like a 30 40 person dinner that like ballooned up into a 100 and like the first one I think had like 12 13 elected officials
37:45
and then it just like kept gaining steam from there where just like the you know sort of dinner got bigger and then eventually the dinner was so big they were like man we got a lot of really great people here and we're doing a private dinner. I think it like the
37:54
I think it like the public would be very interested in like you know some of these people and conversations happening you know in the public sphere too.
38:00
we expanded like including like a you know more public daytime forum.
38:03
Um and then that just you know sort of gained momentum and this year it's like I just in some ways I can't imagine how much of a you better you know lineup one could have.
38:10
I think like the you know sort of main message just like look you know if we like go back in time to like 2018 you had everything from like Google bailing on the Maven project like VC saying that like you know investing in weapons was just as bad as investing in like porn and gambling.
38:25
and gambling. And so there was just so much hesitation and there was like a real rift I feel like between Silicon Valley and you know you know you Washington DC that is kind of counterintuitive like if you look at the Obama era like part of why Obama 108 2012 was like a deep integration with Silicon Valley and tech and it was like the first social media you know sort of
38:42
driven campaign but I felt like you know partially in Trump era there was just like this huge rift because like Silicon Valley was so left Trump was seen as so radical that like people didn't want to work together and so honestly a part of the message is like look we're all on the same team and we're working together to make the United States better. And so
38:55
And so one of my like favorite examples of this is I'm moderating a panel that's with uh Secretary of the Interior Doug Bergam.
39:03
Um Kevin Wheel who's the chief product officer of OpenAI and then Ree Pat who's the chief investment officer and president of Alphabet.
39:09
Um and look like in theory Alphabet and OpenAI are like hugely competitive.
39:14
On the flip side, like OpenAI has the best, you know, sort of consumer application in AI that's ever existed.
39:20
And Alphabet was just awarded a Nobel Prize last year for Alphafold, you know, predicting protein, you know, sort of folding and like the, you know, protein structures based off amino acid sequences.
39:29
amino acid sequences. And so the like goal of that panel to be like look like yes these companies are competing but also we're all way better off if these companies can build as many [ __ ] data centers and have as cheap of energy as possible so that like you know we don't have you know deepseek becoming the like
39:44
default open source model that the rest of the world uses that can't afford the like you know you know chat GPT and can't afford you know sort of alpha fold and there's a lot of soft power that comes from that like do you want the thing that like the random person in Bulgaria is using as their AI to be willing to talk about Tman Square or not. I prefer the version where it can
40:01
not. I prefer the version where it can talk about sort of Tinman Square and the best way that we do that is make sure that we are the best at AI have the best energy and the best way of doing that is like tech needs to collaborate with DC and Secretary Interior Bergam needs to
40:14
unleash a wave of you know you know you know streamline permitting and you know you know nuclear energy you know in the United States and um what better place to talk about that than literally in the Capitol you know sort of hill visitor center. Yeah. Do you do you know how the Yeah.
40:26
Do you do you know how the the pre the the Obama era collaboration between Silicon Valley and DC happened?
40:35
Like was there an instantiation of Hillen Valley that was just like the old big tech companies talking to the Democratic administration in the same way?
40:44
Because Hillen Valley is is bipartisan, right?
40:46
Like when I was there last year, I was hanging out with Chuck Schumer and stuff.
40:50
So, like it's not like you guys are like explicitly conservative, although obviously there is like a push back against the the previous tone in Silicon Valley, but uh walk me through some of the the history there.
41:02
Yeah, I don't know like what the history was of the Obama campaign and how it got so social mediacentric.
41:08
I remember they had this like was it like the CTO guy that was like an ex early Google guy or something?
41:15
Google guy or something? I heard some crazy stat that that uh you so the the president like whenever the president goes to visit a uh an organization that's non-governmental it gets logged and the number one organization that Obama met with was Google during his
41:30
eight years and it was and it was just a very very close tie I think and and I think that there was maybe maybe I'm thinking like the precursor to this is more like TED like you you know the TED talk era is kind of where like all the elites would come together and there would be some crossover. Maybe that's
41:46
Maybe that's not a perfect match, but uh but anyway, uh we we we can move on.
41:50
Uh I want to hear the goal here was to like hopefully make it like sort of more immune from administration changes basically where it's like, you know, so yeah, Obama visited Google all the time.
41:58
Google basically like, you know, would ban Trump from ever going on campus.
42:01
And so we started Hill and Valley under the Biden administration and we've tried to keep it as close as we can to bipartisan as possible throughout all the years.
42:10
Right now look, obviously right now Republicans are in control of, you know, sort of both Congress and Senate and presidency, etc.
42:14
presidency, etc. They're obviously a little bit more represented this year, but the goal is like how do we make sure that that like channel of communication between the top technology leaders and elected officials stays there irrespective of who happens to be, you
42:25
know, sort of in the White House at that current time because I don't think what you want is this thing where like the only time that Silicon Valley and, you know, DC talk to each other is when like DC happens to be crazy left-leaning because it happens to align with like a significant portion of Silicon Valley. Not everybody. I mean thankfully the Not everybody.
42:39
Not everybody. I mean thankfully the tech right is willing to be a little more you know sort of vocal but look you know even in this last election when you know you had David Sax screaming from the rooftops about you know you know you
42:48
know being willing to vote for Trump if you look at like you know donations Silicon Valley qu Silicon Valley was still like 85% you know Democrat you know by on a dollars basis and so yeah interesting dynamic where the dollars were telling a very different story than the timeline. Yeah, I actually wrote a
43:02
Yeah, I actually wrote a piece in Pirwires about that.
43:03
Uh it was right before uh Andre went full MAGA, so it was a little bit like uh like I had the data all crunched and I was like, "Oh, it's actually like very purple, very split."
43:15
It was almost like 50/50.
43:17
Um but it was also like almost entirely driven by power law donors like between Peter and uh and Greylock uh Reed Hoffman. Yeah, Reed Hoffman.
43:26
Like like those two were like at the biggest in terms of in terms of it wasn't for this cycle.
43:31
It was like over the last four years or something like that.
43:32
Um, but then and Mark uh and Andrea was actually like perfectly 50-50 split.
43:38
Like they were perfectly bipartisan because a lot of what they were donating to was like crypto stuff and then when they came to partisan stuff, they typically donated to both sides.
43:46
Anyway, um so walk me through uh some of what do you think Silicon Valley is asking for or pitching in DC these days?
43:56
It feels like there's a bit of a narrative at least on X that uh oh, all these like tech people supported Trump.
44:05
They're the dog who caught the car and it's not going their way or they don't even know what to ask for or what they're asking for isn't getting done.
44:13
Um what do what do you think the message will be to DC from tech next week?
44:18
Yeah, I'll go through honestly just like some of the panels that like you know I'm um you know moderating and like the message on each.
44:24
kind of gave you the like you know AI panel where it's like look there are a bunch of like you know sort of EPA and permitting restrictions that like are preventing us from setting up as energy and data centers that we need and like secretary Bergam is the person that like oversees some chunk of that not all of
44:38
it he doesn't oversee the EPA but like that's the request there is like let's make some policy changes so that open AI and you know sort of Google are not restricted by regulations as like the primary you know um you know bottleneck uh to you know their growth of data centers and energy um you know I love my you Delta V portion on TVPN. So, I'll
44:54
So, I'll talk about the, you know, sort of space side of things.
44:58
Um, I'm gonna be moderating between Tim Hughes, who's the SVP of all, you know, sort of business basically at SpaceX.
45:03
Um, Representative George Whitesides, who's the former, you know, sort of Virgin, uh, CEO, uh, now turned, uh, you know, congressional representative, you know, sort of junior congressman.
45:12
Um, and then, uh, Major General, uh, Bucky, who's head of all things space at the Defense Innovation Unit.
45:18
Um, so it's a little bit of both, you know, sort of civil plus, you know, sort of DoD.
45:21
sort of DoD. Um I think there the request is like look there's some like pretty ambitious goals that you know sort of Trump has set forth basically you know wants boots on you know sort of Mars and moon wants to simulate low earth orbit you sort of economy wants more of the you know sort of academic community to engage in aerospace and I think the message there is like
45:38
look NASA needs to lean on you commercial space for the things that it provides and you sort of stick to what it does best for like the you know sort of truly you know sort of out there things and so um you know Jared Isaacman you know made some comments in his congressional hearing around like SLS L is, you know, a big rocket and maybe gets us to the moon soon, but it's probably not the long-term solution. And
45:56
And so, like that's a perfect example of like, you know, I think everybody in commercial space largely agrees with the fact that that, you know, the commercial industry has better, cheaper, you know, more effective rockets than, you know, anything that NASA is building inhouse at this point.
46:10
We should probably reallocate that budget to just those commercial companies or to other NASA priorities rather than spending a bunch, you know, sort of on SLS.
46:17
So, that's a tactical thing.
46:18
You know, I'm doing this fireside chat with Venode Kosla.
46:20
One of his big things is just like the integration of more and more AI, you know, basically into healthcare.
46:25
We have this mutual portfolio company, you know, sort of stored health that has gone really deep in like, you know, $4 billion company.
46:30
Um, they provide like they're basically the largest physical therapy provider largely done vi like a, you know, chat screen.
46:36
It's like they've got sensors that they put on you.
46:39
It like gamifies it, etc.
46:39
How do you get more and more of like, you know, Medicaid and Medicare to yes, use humans when like you've got some super delicate operation, etc.
46:48
There's so much of like that care that's provided that at this point, you know, could be exported to a bunch of basically like commercial health companies that are largely, you know, integrated into AI and get more aggressive on that which satisfies honestly a bunch of the current administration's priorities as much of a node, you know, is not a huge fan of Trump.
47:03
Trump. um he is a fan of you know basically using you know sort of AI to you know improve healthcare and then that you know matches Trump's you know goals of improve government efficiency where you can cut out a bunch of the Medicare and Medicaid cost where it's like look we can all talk about like defense budgets and this and this
47:17
entitlements are the vast majority of the federal government's budget and so you know if you want to go look at efficiencies you're going to have way more juice to squeeze like you know you know improving Medicare than like you know you can cut out all the DEI programs in the world and that's barely a blip relative to Medicare. Yeah. How Yeah.
47:29
How uh how much uh do you expect uh the conversation uh to veer towards Doge and then specifically uh Trump had promised earlier this month a trillion dollar defense budget uh which would be a 12% increase over this year?
47:48
Uh and uh yeah, do you expect that to be a major top talking point as part of some of these conversations or is that um you know just just businesses? Yeah.
48:00
And and and also I mean we were talking about the defense budget earlier.
48:03
It seemed like you were like lightly blackpilled on it for a little bit.
48:06
Uh have you updated your view?
48:10
Um well I mean a part of why um yeah it's always fun with Hill and Valley where we can't decide on the date until Congress publishes it schedule because we are dependent on the elected officials you know sort of being there otherwise it's not a very interesting event.
48:21
Uh and so anyways a part of why it's next week is because Congress is in session you know basically next week and everybody's you know sort of flying into town on you know sort of Monday.
48:27
Both whether you're Yensen Huang or you're you know Senator Banks both are flying in town on Monday.
48:32
Um and next week is when they're both, you know, sort of discussing the reconciliation bill where they're basically going to be, um, you know, uh, uh, increasing defense budget beyond the continuing resolution, uh, to match some of the, you know, February bills that we talked about, you know, sort of last time around when we chatted about this.
48:46
Um, as well as starting to talk about next year's basically, you know, sort of defense budget.
48:48
know, sort of defense budget. Um you know I think yeah there's you sort of clear signaling you sort of from the top that um there's going to be an increase and in particular around the president's top priorities which were nuclear weapons modernization um golden dome hypersonic boost glide vehicles uh you know sort of ship uh building um and
49:06
then general reindustrialization and so um there's been talk of that reconciliation bill being 150 to 200 you know sort of billion which obviously gets you know so the total last year bill you know pretty close to that you know trillion dollar mark and then obviously um you sort of next year's budget you know sort of being at that trillion dollar Mark. And so, um, yeah,
49:19
And so, um, yeah, there's a bunch of people that are literally on the House Appropriations and Senate, you know, House Armed Services Committee, um, and, you know, Senate, you know, Armed Services Committee, um, that will be there.
49:28
Um, and I'm sure that they will be, you know, sort of the the talk of the town.
49:33
But it it's always interesting with this stuff where like um Hill and Valley we've heard from some of the elected officials is actually some of the one of the few times where um even the elected officials gather at that level of density cuz most of the
49:45
time they're like you know even in these like you know uh uh um weeks where they're in session man it's like staff running around doing papers they might briefly all go to the floor together but they barely have a chance to talk on the floor. Like we've actually heard that
49:55
Like we've actually heard that like some of the like bills end up getting negotiated like during the cocktail hour and like reception of Hill and Valley because it's just like one of the few times where it's like oh we like have the entire House Armed Services Committee here and we're not like in a like session where we're like grilling somebody.
50:09
We're actually like here and like casually chat for a while about like what we joke it's like if you you know if you can't put a deal on a napkin like it's probably too complicated in venture.
50:17
It's like if you can't put a bill or a budget on a napkin like it's just too complicated.
50:21
So, we're just running the federal government on napkins and it's actually good, right? Yeah, it's great.
50:26
It's funny like the last couple cocktail receptions, it's so funny where you're like, oh, it's like everybody's mingling, etc.
50:31
It's like literally all the tech dudes are sitting over there and then like all the elected officials are like scrambling like trying to figure out like, okay, you know, you know, what is our, you know, sort of stance, etc.
50:40
And then it's so funny because it's like it's bipartisan, but also like some of these people [ __ ] hate each other.
50:45
And so it's just last year like you know you got Chuck Schumer giving like the you know opening remarks but then you've got his like Republican counterparts like all like rolling their eyes and scoffing and everything and I'm like ah DC what a wonderful place. The swamp. The swamp. The swamp baby. That's funny.
51:00
Uh we're going to see you in a suit, right?
51:03
you know, um, uh, I have finally, uh, been given approval by, uh, my, uh, government relations team that when I go do one-on-one briefings with congressmen, I can now wear a t-shirt with a blazer.
51:16
Uh, but at Hillen Valley, that is a time where if I'm on stage with a senator, I'm definitely wearing a [ __ ] suit and wearing matching shoes.
51:23
What does it take to get a ticket to Hillen Valley these days?
51:27
Um, you know, I I I'm not I don't think it's a, you know, sort of perfect process, but, you know, between Jacob, Christian, and I, we do our best to, you know, securate a phenomenal, you sort of dinner list in daytime.
51:35
Um, I think with daytime last year, we weren't sure how many people to bring, and then like the, you know, audience wasn't always fully filled.
51:43
And so this year, we maybe swung a little, you know, too hard, too soon, and I think now it's going to be a [ __ ] mob.
51:48
Um, so anyways, we're we're learning each year on how to, you know, sort of balance on what the proper process should be.
51:53
But at this point we are very at capacity on both.
51:55
But in future years you know just hit up you know delion tofounders.
52:01
com jacobstate department.
52:01
gov Christian137 ventures.
52:05
com and you know beg for forgiveness or beg for hope and we'll figure out whether or not we can get you in there. That's awesome.
52:10
get you in there. That's awesome. uh what do you expect the dialogue to be around uh big tech is is you know such a charged word but at the same time in the sort of AI race uh you know if you ignore upstart labs even though they
52:27
have billions of dollars they're still young companies which means big tech is like critical to national security uh do you expect there to be a conversation around um you know right now you're seeing Facebook uh sorry Meta just being sort of like dragged by the FTC system is collaborating. Yeah, collaborating
52:44
Yeah, collaborating which is which is crazy.
52:47
Uh, a lot of that feels like rehashing an acquisition that was approved, you know, that went through over a decade ago uh feels like such a massive distraction uh at a time when we don't want our big we want our big technology companies, you know, focused on uh winning this very important race, right? Yes.
53:12
But they made such big enemies where it's just like both sides.
53:14
Like look, Zuck is, you know, done his best to cozy up to, you know, to Trump, White House, etc.
53:19
, you know, he's wearing his chains, he's tan, he's, you know, looking again with Joe Rogan, but also like, you know, the Dems hate him because they feel like, you know, they lost the 2016 election because of him.
53:33
And, you know, sort of Trump hates him because he feels like he lost the 2020 election because of him.
53:36
And so, you know, I don't think he made a lot of friends.
53:39
And you know, I don't see any politician bing at like the FTC going and dredging that stuff up.
53:44
And like, you know, even Kevin Cystrom has a, you know, sort of bone to pick with him.
53:47
And so I I definitely, you know, sort of buy into the like the sort of distraction, you know, sort of narrative.
53:53
I also kind of buy into the like, yeah, I mean, like look, like, you know, um, you know, we maybe are in a like parallel to the Gilded era, you know, are we in the roaring 20s?
54:03
Are we in the like, you know, sort of depression 30s?
54:05
you know, you know, you know, do these, you know, sort of uh what were they not oligarchs?
54:10
What was the name that they used for like the gilded era? Robert Barren. Yeah. Yeah. The Barons. The Baron industry. The Robert Barons. Exactly.
54:18
So, like, you know, maybe there is a little bit of, you know, sort of Robert Baron mentality.
54:20
Um, you know, right now with some of these big tech companies, um, man, I mean I mean, who's been advocating for monopolies?
54:27
I mean, it's a crazy idea. I don't know. Crazy concept.
54:30
It's almost like someone wrote a book on it and then everyone was like, that's exactly what we should do.
54:33
We don't believe in the M word over here at Founders Fund.
54:37
We want to invest where there's lots of competition and it's really hard to gain market share. Exactly.
54:42
Just power law outcomes for whatever reason. Could be any.
54:44
Um what uh what do you think about the uh the idea that RAMP uh should get a government contract, the government should run on RAMP.
54:54
We were joking about it months ago.
54:56
It seems to be getting more and more serious. Do you like the idea?
55:00
Um, you know, look, I think, uh, the current smart card system within the GSA, um, is a pretty antiquated and old school system.
55:07
Um, you know, Trump and Doge want to root out a bunch of fraud.
55:11
Um, you know, you know, Ramp has seen, you know, even with some of the, you know, neopimes, traditional defense contractors, people that work with the government that even on like the commercial contractor side of things, they're able to root out things that are inefficiencies, etc.
55:21
Man, can you imagine what happens when they, you know, sort of get implemented within the government.
55:26
So, you know, not a done deal or anything.
55:27
A lot of work to be done there, but I think it's pretty damn good for the country if we manage to get them in there.
55:32
And apologies on that note, boys.
55:34
I got to run, but great having a little mini Delta V, mini hill and valley.
55:38
Yeah, I'm looking I'm looking forward to next week.
55:40
It's going to be very great. See you guys in DC. See you soon. We'll see you there. See you soon. We'll talk soon. Bye. Let's go to an ad.
55:46
We got ad quick out ofome advertising made easy and measurable.
55:52
Say goodbye to out of home.
55:56
Don't know how that ties to adqu, but I'm sure they'll love it.
55:58
Golden retriever mode is running an a billboard for your series A. Yes.
56:02
And it's also it's also not overthinking it.
56:04
Like yeah, uh there's it's so easy to get into the the math of like, oh, I need to be able to measure every single performance metric.
56:13
I mean, out of ad makes out of home more measurable, but there still is a brand element to running ads.
56:21
And uh this is a something that you see in every company as they mature.
56:25
they eventually realize that uh it is it is worthwhile to do marketing that is not necessarily perfectly trackable.
56:32
Case in point, Jensen Wong, who will be at Hillen Valley uh dropping off goldplated uh GB200 servers uh to the future AI builders, you know, and uh and endearing that community to him and that's uh and and a great billboard can do that.
56:47
So, head over to adquick. com.
56:49
Uh uh I'm interested to see uh next week at Hill Valley what issues are truly bipartisan, right?
56:55
Energy uh production, right?
56:59
Uh as uh societies uh produce more energy, prosperity tends to go up.
57:05
You could imagine that being uh somewhat bipartisan.
57:08
Uh I was working on a I I was people have been saying, "Oh, John, are you going to run for president?"
57:12
I was thinking about like if I did what my plat political platform would be because I want to be bipartisan and I was thinking my platform would be pretty simple.
57:19
It would just be GDP up, unemployment down, boom, GDP per capita up. That's right.
57:25
Uh productivity up and uh government waste down.
57:28
Hard to argue with any of this. Exactly.
57:31
I feel like I feel like every American could be behind a platform or a presidential candidate who just said, "My goal is GDP maximization."
57:41
That seems pretty simple.
57:41
That seems like something everyone can value.
57:44
Security, right access to the Jane Street.
57:46
Speaking of Jane Street, uh the trading revenues nearly doubled in 2024 to more than 20 billion.
57:50
Let's hear it for Jane Street.
57:52
Folks, I know a lot of you were worried that they weren't making enough money, but they're back.
58:00
Pachy McCormack says, "Man, SPF would be so rich if he stayed at Jane Street." Uh funny take. Uh very interesting.
58:05
I'm always interested to see how these uh how these details look. The bowl all twisted up. Very very funny. Whoa. Uh whoa. Yeah. What is going on there? Um but very fun.
58:20
Uh on the flip side, uh the information is reporting that lots of tech companies have had their hiring plans impacted.
58:28
Uh 19% in the survey said we cut staff.
58:32
33% said we plan to hire less.
58:34
30% said no impact, but we are evaluating the situation.
58:37
13% said, "Our hiring plans stay the same."
58:40
And 5% said, "We plan to hire more."
58:43
Now, I wonder how much of that is driven just by the fact that only 5% of venture-back companies are on the upswing because it's kind of a longot game and so they're not all scaling up.
58:54
Um, but it is interesting that, uh, people could be cutting staff for a variety of reasons.
58:59
Could be tariff related, but it also could be AI related.
59:00
Could be a bunch of or we plan to hire less. Could be.
59:03
Or it could just be if you have the time to fill out an information survey, your business is struggling.
59:10
You be focusing on your business. Maybe I don't know. That's possible.
59:13
Are the best companies really answering the survey? I don't know.
59:16
I do think these I do think these types of uh anonymous uh surveys are very interesting.
59:21
I would uh it would be great to see them more broken broken out, right?
59:25
There's a bit of game theory to it because like if if if I get this and I am hiring, I'm going to want to sigh out my competition into firing everyone.
59:33
So, I'm going to respond with cutting staff.
59:36
Then every then it becomes a meme.
59:38
Everyone's like, "Oh, everyone's got to cut staff. Everyone fires everyone. You're the last person.
59:42
You have the pick of the litter.
59:42
You can hire all these people.
59:43
That's the way you win the game."
59:46
Uh Tyler asked for a dedicated supplement rundown from Jordy Hayes.
59:50
I'm looking to outsource my thinking. So, what do you take? gave a comment. Let me just pull it up.
59:56
Uh nice picture of Tony Soprano in a stained glass window for some reason.
1:00:00
I think Gibli Gibli quite gib stained glass window, but I like it. It's beautiful.
1:00:08
Uh my current stack electrolytes heavily weighted towards magnesium. Okay.
1:00:11
Uh magnesium is an electrolyte.
1:00:14
Uh so it usually comes in in various electrolyte products, but taking a lot more magnesium over Isn't magnesium a metal?
1:00:24
I feel like it's a metal. I don't know.
1:00:25
Anyway, that would be pretty metal.
1:00:25
We need a metal sound effect.
1:00:27
I mean, iron's important, right? Iron at all. Uh, no.
1:00:32
Most people to to my knowledge have have too much iron and uh donating blood as a way to pull the iron out.
1:00:43
Then I'm on creatine, of course.
1:00:43
I take zinc and vitamin C in a combination.
1:00:45
Uh, thamine, uh, which is a B vitamin.
1:00:49
Your body can become thamine deficient if you use nicotine. I do use nicotine.
1:00:55
So thamine to boost it back up. Yes, exactly.
1:01:00
And then torine uh which is Red Bull which is in Red Bull.
1:01:03
They were smart to do that.
1:01:05
And then I'll cycle peptides from time to time.
1:01:07
We we got to get on a peptide cycle.
1:01:09
Not not this second, but historically I've I've indulged.
1:01:14
But those are performance sensing drugs.
1:01:16
They're not legal for most professional athletes today. not natty.
1:01:22
Uh, I wouldn't I wouldn't I think trying claiming natty is like claiming you're not doing what it No, I agree.
1:01:28
I'm very proabusing uh steroids.
1:01:30
No, but we should get on a peptide cycle together. Okay.
1:01:35
And uh I want to be on the Wolverine thing. I want to be on Yeah. BPC57. Yeah.
1:01:38
I want to take whatever the LD50 is.
1:01:41
Give me just a hair under that. Yeah.
1:01:43
Give me just a hair under that.
1:01:47
Anyway, dudes will buy a billboard in SF on the 101 to announce getting a bed frame.
1:01:52
That would actually go viral.
1:01:52
You should do that if you're trying to raise money.
1:01:56
I have acquired a bed frame, folks. Somebody should do it. Reach out to Adqu. They will set you up.
1:02:00
But let's bring in public. We got guys.
1:02:08
Welcome to the show, guys.
1:02:08
I can't We can't hear you. What's that sound? What's that sound? It's happening. So loud. It's happening.
1:02:16
It's Oh, is that the sound of the Aston Martin? It's happening. Oh, I'm at the box.
1:02:25
Miami GP, a Las Vegas GP.
1:02:25
Oh, is that public advertising on the Aston Martin F1?
1:02:31
How did you get my voicemail to run on the show? That's great.
1:02:36
For me, it just sounded like the sound effects of like Pacific Rim or something. Yeah. Yeah. Yeah.
1:02:39
Uh, we got it from that influencer Ashton Hall, the guy who has the the viral morning routine.
1:02:45
He drops that sound effect.
1:02:45
So, we had to pull that over to our show.
1:02:50
But, uh, how you guys doing?
1:02:50
Can you uh can you introduce yourselves a little a a little bit and explain what the news is today? Absolutely. So, I'm Yanick Kosio.
1:03:01
That's life author Kosio co-founders of public.
1:03:03
Um, we announced today, as you could tell from your last intro, We are the new uh sponsors of the Aston Martin Formula 1 team. Amazing. Amazing. Love it. So amazing. Fantastic.
1:03:19
Storied storied uh team storied brand.
1:03:22
And they're going to write books about this partnership. I think so. Can we get a or no? Yeah.
1:03:26
Yeah, of course we can get a We're also going to pull up some uh some some video of of uh Aston Martins driving around entertain the viewers.
1:03:37
Uh can you break down can you break down the process?
1:03:41
I imagine I we know this has been in the works for a while.
1:03:43
Uh but uh what what was the process when you know and when did you even start thinking about doing something like this?
1:03:53
Um well so I mean let's talk about first why it makes sense for us first and then we get into the process.
1:03:57
So we started six years ago mainly as a fractional shares platform.
1:04:01
We were like the first to do the whole first trading platform to do fractional shares.
1:04:04
Then it obviously became a big thing.
1:04:06
Uh but since then I'd argue that the platform has matured a lot.
1:04:10
I think now we have one of the most powerful investing sort of suite of tools in America.
1:04:14
Multiasset investing, multiple account types, embedded deep AI research and customers have evolved kind of with us.
1:04:22
So now folks are coming in with hundreds of thousands or even millions of dollars in their accounts.
1:04:29
Uh but to be honest, not everyone knows that we're there.
1:04:32
And so this partnership was a great opportunity for us to sort of raise some awareness around that and kind of get that message across obviously to the the right demographic as well.
1:04:42
Can you talk about anatomy of the deal?
1:04:44
Uh how did you meet the folks over there?
1:04:47
Did this all start with is there an agency involved?
1:04:49
I know you guys do a lot of stuff internally. Is it just an email?
1:04:53
Did you meet someone at an F1 race?
1:04:54
Like how do you even meet these folks to begin? No agencies. I love it.
1:04:59
agencies. I love it. We have a we have a we have an investor on the cap table uh that happens to be involved with the team as well and so through that we got introduced to them and this is also a deal where um the as actually took part equity in public as well um and it's you
1:05:21
know kind of like I think it's the first time they've really done this and um and so it was a little bit of like experiment for them as well or like thing for them as well And what's interesting is that the way they also think about it is that, you know, they have a platform. They have, you know,
1:05:37
They have, you know, also sponsors that pay them, you know, ridiculous amounts of money and whatnot.
1:05:43
And so like they don't necessarily like need another million bucks from a from a from another startup and so on, but they like the idea of finding opportunities that they feel they understand themselves as well.
1:05:56
in our case like World Wealth Transfer, their audience being the type of audience that has money to invest.
1:06:01
Um, US markets being one of the fastest growing markets for Formula 1.
1:06:06
Generally speaking, it's the only country with three races, you know, and so on.
1:06:10
And, um, and so for them, the viewers focus and the focus of the audience that we had was like a good match.
1:06:16
And so that's why, you know, for them, it was a also just a good idea um, to to be a little bit closer involved and actually like join the cap table as well.
1:06:25
well. uh how do how do you guys think about uh international long-term uh get you know do you see a world in the future where you have millions of users outside of the country uh I know US has obviously been the been the focus to date absolutely but the way that starts
1:06:44
is we actually launched uh an app called alpha which is a little bit of a spin out of our AI product uh launched that in international markets uh late last year as a separate kind of product so that's live and growing well in a bunch of European markets and and a few other places around the world. And so that's
1:07:00
And so that's basically like Apple stocks with AI powers.
1:07:04
That's how you can think of it.
1:07:05
You literally come in, you take a photo of your watch list, wherever you have it, and the AI auto follows everything and tells you why things are moving in real time, not just they're moving and by how much.
1:07:15
And then you can directly ask questions and do research and all that stuff.
1:07:18
So that's like I would say the first step in our international strategy in building that audience sort of abroad.
1:07:24
And then obviously as you can imagine investing services can come later because that's the aspect that has a regulatory component to it which takes totally. Yeah.
1:07:33
C can you talk about um how you actually envision the partnership manifesting in advertisements?
1:07:40
Obviously like logo on the car, but there are what 21 races.
1:07:42
Um I there are so many different places to put logos, integrate, throw, have a box, have a party, have an after show, pre-show, digital.
1:07:54
There's so many different things that can package up into these actual partnerships.
1:07:58
uh what what did that process look like and where did you land?
1:08:03
Yeah, I I I want to call out I want to see Alonzo uh you know executing trades you know during a in the pit lane.
1:08:10
It's that fast, by the way, that you you can actually totally But yeah, totally.
1:08:16
I mean, there's always whenever you do these deals, there's this massive laundry list of stuff that you have access to and can do and whatnot, right?
1:08:24
That falls into pedal club passes at the events and that falls into like, you know, we will have the logo and the halo and the logo tiny on the side of the car as well, but also during the US races, for example, and things like that.
1:08:36
But one specific thing that we thought about is um in our space of like kind like new broker investing apps um things like referral have been this like mainstream thing of get a free fractional stock and so on.
1:08:50
And as we moved more up market the less that stuff worked because if you have a little bit of money let's be honest you don't really give a [ __ ] about five bucks on free stock. Yeah.
1:09:00
And um and so for us a sense of like okay what do people that you know have a bit of money care about and it's most cases experiences you might not necessarily have access to otherwise.
1:09:10
otherwise. Um and and so the sense of like this partnership is like one of the first ways for us to have the ability to give exclusive experiences to our customers through you know certain giveaways in the app through referral in the app and so on to for example you know win things like access to the pedog
1:09:31
meet and greets with the drivers and all that kind of stuff right and in the future obviously like we'll figure out like what are other ways to execute on that strategy as well but the sense of that like what does referral for a more affluent audience actually look like and falls much more into things like experiences. Yeah. Yeah, for this Yeah.
1:09:44
Yeah, for this specifically also just to finish the quick is um um like basically like starting today you can actually um in the app win access to the paddock in the Vegas race later this year and essentially find like if you find the three little F1 cars in the app which is like hidden in different places in the app and you find all three of them then you essentially enter you know and they're not easy to find by the way either.
1:10:13
So, it's not like a it's not like a thing that everybody will double just tweets out where they are. Of course, of course. Yeah. Yeah. Yeah.
1:10:20
I'm gonna I'm gonna give the app to my three-year-old and say, uh, you got you got 14 hours go.
1:10:26
Make sure to load it with a couple hundred keys before you do. We'll see. Yeah. Yeah. Yeah.
1:10:30
So, we can do a little day trading away.
1:10:32
Uh, h how do you think about the the evolution of uh the way brands integrate with F1?
1:10:40
Obviously, Red Bull doesn't make cars, or I guess they made that one car once, but uh in general, they don't make cars, but they're a huge uh F1 uh sponsor with the whole team.
1:10:50
Hos Automation's kind of in a similar uh similar boat, but then Aston Martin's more of a car brand.
1:10:56
Um how do you think that that's evolved?
1:11:00
And and is there a world where we see a public.
1:11:02
com F1 team at some point?
1:11:06
Uh well, not in the next couple of years.
1:11:10
because now we have this deal.
1:11:10
No, look, I I think what's interesting about the Formula 1 is it is the only sport that I can really think of that has scale and has this sort of thing where whenever Formula 1 comes into town, it's the whole show, right?
1:11:25
It's a Super Bowl event 20 times in a year basically, right?
1:11:30
Because like yeah, you go to a Premier League match, two hours, you knock down a couple pints, it's over and you go about about your day.
1:11:35
This is like the whole weekend.
1:11:37
The circus comes into town.
1:11:39
They talk about this a lot and drive to his wife obviously.
1:11:41
And so therefore, it just lends itself very well to like a very intense focused type of exposure. Yeah. Yeah.
1:11:48
Which I think is really great and I think you've seen that in around the Super Bowl and a few other places, but in the Formula 1, it just kind of happens uh many many times throughout the the course of a year.
1:11:58
Um and I think that's what makes it interesting for B2B companies as well as for consumer companies actually. Yeah.
1:12:05
Did uh did drive to survive factor into your calculations?
1:12:08
I imagine there will be public.
1:12:11
com branding that makes it into drive to survive just by nature of being on the car. Yeah.
1:12:15
But that's the funny thing.
1:12:16
It's like so with uh with Formula 1, you either sponsor a team or you sponsor, you know, a race slash the league itself.
1:12:26
And these are two separate things, right? Yeah. Yeah.
1:12:27
And um and drives to survive is more with the uh with the league itself and song.
1:12:36
And so the trick really for folks like us is what can you do that has the chance to make it into the storyline of the show, right?
1:12:44
And so like you know what kind of beef can we create with I don't know some other training app that you know sports some other team or something or like you know like but like what kind of drama can we be part of essentially? Yeah. So any ideas shout. Yeah.
1:13:00
We'd love we'd love to we'd love to help.
1:13:02
No, but I I mean I can imagine, you know, just naturally the the you'll get placement in the show just as Alonzo and Lance have their moments in the show, right?
1:13:12
So very natural and but but generally you'll always have a multiplier with thing.
1:13:16
There's a great uh Formula 1 game, right?
1:13:18
Lego right now has a Formula 1 kind of thing going on.
1:13:23
And so there's always kind of these these multipliers kind of happening in and around uh the sport. Yeah.
1:13:27
What about other multipliers uh more on like a geol location basis?
1:13:31
I mean, I'm sure you could run geo fenced ads in Vegas that weekend by billboards.
1:13:36
Like what are you thinking to get the most squeeze out of uh the event when it kind of comes together?
1:13:45
I mean, there's a long like like there's a long list of stuff you can do.
1:13:46
Uh it's a multi-year deal.
1:13:50
So we also have a little bit it's starting in the Miami race um in a couple of weeks.
1:13:53
So that will be the first one.
1:13:55
We've kicked off now this essentially scavenger hunt in the app uh where you can get access to Vegas um paddock etc.
1:14:02
by finding these kind of cars around the app.
1:14:06
And so I think there's a lot of stuff we can experiment with.
1:14:09
I think relative to you know we're not quite as big as a Ramco yet.
1:14:15
yet. uh they still have us a little bit on the market cap and so uh but you know but but but we might be one of the more nimble uh folks that can get a little bit more creative and so I would say expect to see a a bunch more uh kind of
1:14:31
stunt how uh how did uh Lawrence Stroll's kind of leadership factor in into the decision like he's obviously has a you know like running the team but then simultaneously like you know has the manufacturer side too with Aston Martin. He's like seems like extremely
1:14:46
He's like seems like extremely convicted to winning and and making a statement and you know um as a as a car enthusiast like I've watched what Aston is doing.
1:14:56
Uh again really really committed to winning.
1:14:59
committed to winning. they've like massively improved their uh did that give you guys extra confidence in going and making a partnership knowing that hey the team by itself is not uh when you look at other teams uh like hos and
1:15:12
things like that who's had a sort of history of of uh economic challenges that's not exactly you know the team that you want to attach yourself to even though they have but also like like generally speaking there's a lot of like change happening in F1 right now, right? You have a bunch of mixups and lots of
1:15:32
You have a bunch of mixups and lots of drivers that switch teams.
1:15:34
You have uh you know behind the scenes, you know, um the the you know, one of the guys who you know, builds one of the the the engineers from the from the from the Red Bull team was hired now at Aston Martin and so on.
1:15:49
And so there's like right now there's a lot of change happening and it's not just you know seeing first win every time and you know having like the joke of just like putting a piece of tape on your TV so the race becomes more fun to watch like over his name.
1:16:04
So and you know and so like there's so much change happening right now and I think that is um why I think this season and the next season and the win after I think are going to be super exciting. Right.
1:16:14
There's there's a new US team coming in with Cadillac next year.
1:16:18
There's a movie with the pit coming out in June or July this year.
1:16:22
And so there's just like a lot happening around it.
1:16:24
Um, you know, which is quite awesome.
1:16:27
But yeah, I think you're totally right.
1:16:28
Like the where Aston Martin sits right now is kind of perfect for us, right?
1:16:33
Because it's not like it's it's it's it's a team that is still a little bit on the up and up, but I think we'll be very competitive over the next couple of years. Yeah. You're already leaf.
1:16:43
You're already wearing dark green.
1:16:45
Are we going to see you guys driving around in some Aston Martin street cars?
1:16:49
Do you have any favorite picks or historical Aston Martins that uh you've been thinking about?
1:16:56
Are you a James Bond fan? James Bond's car, right?
1:16:59
They literally say in one of the Asmaz movies from royalty to double agents, you know, cover everything in between.
1:17:07
And so obviously now in New York City doesn't make a ton of sense to be driving on the DB. No, no.
1:17:14
In in New York, you need to get the Valkyrie.
1:17:15
Clearly, you know, the roads are a little bumpy.
1:17:18
I'm sure the you know, the clearance on that thing isn't great, but it is street legal, so why not be whipping around Fifth Avenue.
1:17:28
You need to basically change your Yeah, you probably need to change your tires like every 200 miles or something like that. But, uh, I'm curious.
1:17:33
Did you guys get any messages this morning from friends back in Europe?
1:17:36
Like, hey, I I saw the news.
1:17:39
Like, that's that's awesome.
1:17:41
I, uh, you know, then you're like, "Hey guys, we've been a billion-dollar, you know, company for a while."
1:17:47
Like, you know, this is like, you know, the first time like we we were we were in like Business Insider uh, like two weeks ago and and some people were messaging John and I like, "Oh, congratulations."
1:17:58
And we're like, "I think we get more views than Business Insider." like uh but thank you.
1:18:01
Um I can imagine a lot of lot of people asking for tickets that's for sure. Yeah. Yeah. Yeah.
1:18:08
You guys are going to be extra all the people that had like a 25k angel investment.
1:18:12
They're now coming like so they're like so I'll be in the p I'll be in the paddic, right? Yeah.
1:18:16
You can get me tickets to the whole season, right?
1:18:19
Like what does that cost?
1:18:19
Well, well, uh I'm extremely excited.
1:18:22
Uh I'm going to be even more excited to watch.
1:18:27
have another reason to, you know, turn it on at like 4:00 a. m.
1:18:29
or whatever Pacific, whenever, you know, uh, the international races happen.
1:18:33
And we, uh, we should be signing a lease, uh, for our new studio, uh, and we're going to have a lot more space, so we should figure out how to get a car, uh, in in the background, uh, one way or another.
1:18:45
You'd be surprised how cheap it actually is. I know. I know.
1:18:48
I remember I remember our conversation.
1:18:51
Not sure if I'm allowed to like say these numbers on here, but yeah, it is actually not that bad. Yeah, cheap.
1:18:57
Cheaper than a real, you know, a regular Aston Martin. Like it won't drive.
1:19:01
It doesn't have an engine or anything.
1:19:02
It doesn't like like show pieces like five ultimate lobby or something sometimes, you know.
1:19:07
No, I want the I want it like on like on the back on the back wall of the studio.
1:19:11
I mean, I went and toured Red Bull head Red Bull's headquarters in Santa Monica a couple years ago, and they had the full F1 car there on the halfpipe, and it just made the vibe in the office like fantastic.
1:19:22
And so, yeah, I'd highly recommend uh getting an F1 car.
1:19:24
Everyone should really uh it's part of the ideal threecar garage.
1:19:31
You know, you need the family hauler, you need the weekender, and you need the F1 car. Of course. Absolutely.
1:19:36
Why doesn't everyone just do this? I don't get it. I know.
1:19:38
I don't know why we're the first to think of this. I agree. Crazy. Awesome, guys.
1:19:43
Well, congratulations uh and congrats to the whole team.
1:19:48
It's going to be uh you know, very excited for for Miami and uh everything to come. Awesome. We'll see you soon. Cheers. Great to see you later. We're getting an F1 car.
1:19:59
We need to I I think we should daily it.
1:20:03
You know, uh just you know, it's going to be a little rough, going to be a little bumpy.
1:20:07
Um, but you pull up in an F1 car.
1:20:10
You pull up with a fantastic PC Philippe on your wrist like the guy in that picture that you picked up on bezel. Go to getb bezel. com.
1:20:18
Your bezel concierge is available now to source any watch on the planet.
1:20:23
You don't want to be get caught on race weekend with a bare wrist. That's right.
1:20:28
That's that's unacceptable.
1:20:29
Yeah, it's it's laughable.
1:20:32
Uh you can't RM would be a good option for race weekend.
1:20:34
Racing machine on the wrist.
1:20:36
Yeah, we've been looking at some RMS and I can see Bezel going over and and and you know maybe you know getting their own team at some point with with the trajectory that they're on. I would love that.
1:20:46
Anyway, uh our next guest is in the studio. Let's bring him in.
1:20:49
We got Alfred from Listen Labs announcing and we got his co-founder. Boom.
1:20:54
And they got the they got the jackets.
1:20:58
They're not they're not quite uh color coordinated.
1:21:00
I loveord dressing up for the show.
1:21:02
We always appreciate people dress up when they coordinate their outfits. Uh how you guys doing? Doing well. Yeah, exciting.
1:21:09
Uh can you give us a little overview of the the history of the company?
1:21:13
Introduce yourselves, tell us about the round, uh give us the basics. For sure.
1:21:16
So, uh listen is an AI customer researcher that can find and interview thousands of users and tell you what they want.
1:21:24
And today we're or yesterday we announced our series A 27 million in total raised led by Sequoia, Conviction and Pair.
1:21:31
And yeah, we work with some amazing customers like Microsoft, Canva and Chubbies. Mhm.
1:21:36
And the core concept of what we do is like every company wants to be customer obsessed.
1:21:44
So imagine you wanted to take that to the most like fullest extent and that's basically you would talk to uh every customer you could and you talk to them try to understand exactly who they are and what they think about and you'd find a way to synthesize all of those conversations into a clear understanding of their behavior.
1:22:01
And you wouldn't do this just once. You do it all the time.
1:22:05
Uh, every time you make a change to your product or service or marketing, and that's what we do. Cool.
1:22:09
I can imagine a ton of different ways to get customer insights out of all the data.
1:22:13
Just using Microsoft as an example, like there's probably 1 million tickets in some database that's just a bunch of text that hasn't been processed.
1:22:21
You, you know, run an LLM over that. That makes sense.
1:22:24
It sounds like you're doing something more advanced where you're actually calling people up.
1:22:26
Maybe there's a a screen recording and interaction and some questions back and forth. Is that all AIdriven?
1:22:32
Walk me through the case study, I guess, with Microsoft or anyone else you want to you want to chat about. Yeah. Yeah. Yeah, for sure.
1:22:39
So, it's an AI that can have a one-on-one conversation and then you can have hundreds of those conversations in parallel.
1:22:45
And what we found is that kind of you have to reach enough people to really understand what people want.
1:22:51
So if you speak to 10 10 of them, most of them won't have much interesting things to say.
1:22:57
And the second thing is the the synthesis.
1:22:59
If you have like hundreds of conversations, finding the signal over the noise is is you know AI is amazing is amazing at that. Sure.
1:23:06
Um and you know AI is also the ultimate listener.
1:23:12
It's more empathetic than than myself.
1:23:15
And as a case study like one of my favorite ones is Chubbies.
1:23:18
favorite ones is Chubbies. So um they recently launched a new product based on learnings that they made from listen that is growing really really fast um and it's a little bit weird but it was an AI or it was interviewing kids using uh listen interesting and um they were
1:23:37
much more honest to our AI versus like speaking to a stranger um and it enabled them to learn a lot about like how the how to make their shorts more comfortable and basically created a new product with a new liner in the shorts that um just felt much better for the kids and now uh that product is growing really fast. Do do you believe there's
1:23:59
Do do you believe there's uh sort of a customer love flywheel in a sense where the more uh someone likes a product the more inclined they are to want to talk about how to make it better.
1:24:11
better. and is part of what you guys are doing helping to like accelerate that where a product could have some customers but uh it's hard to really get scaled feedback because nobody really loves the product enough like I I get emails all the time I'll try a SAS product and I'll churn and then they'll
1:24:26
reach out to me being like hey you know I I uh you know can can we get feedback and usually I'm not super um inclined uh to to provide feedback sometimes I do if I feel like it's just off but how do you think about sort of like building that sort of customer feedback flywheel and converting it into customer love. Yeah. Sorry. Yeah. I mean I think what Yeah. Sorry. Yeah.
1:24:48
Yeah. Sorry. Yeah. I mean I think what is interesting is the you know we we have this at bigger companies right um what you actually you know you have a lot of feedback as you said before but um actually talking to real customers is is
1:25:06
actually pretty complex right it's at the bigger companies they typically outsource it to to external agencies because there's a lot of hoops they have to go through and you know they charge like 100k and then they schedule like 20 interviews and and do that. Um, and you
1:25:20
Um, and you know what we enable them to do is instead of using using these external agencies, they can just use us, right?
1:25:29
It's cheaper, it's faster, um, it's better because can reach way more people.
1:25:32
And yeah, I think that's an exciting opportunity also for like in general for, you know, AI founders to, you know, if you can replace one of those like external um, you know, external partners.
1:25:47
basically you just just flip a switch and um you know you sell an outcome instead of just a software.
1:25:54
software. when you talk to um when you talk to maybe bigger older companies are you surprised at how they sometimes don't have a process in place to talk to customers like I feel like it's part of Silicon Valley like ethos lore you know PG is just sort of like banging you know founders over the head saying like talk
1:26:12
to your customers talk to your customers and so it's it's a part of the culture here but um I I imagine there's some companies that you're maybe in a sales process with that don't have any infrastructure uh uh or or very little infra infrastructure in place uh rel relative to how sort of like scaled they are. Yeah. I Yeah.
1:26:30
I mean a lot of the products and services out there are kind of uh they they suck.
1:26:37
Uh you know and and it's it's it's so often that you use um a product and you think like okay what were they even thinking?
1:26:48
Like clearly they're not keeping us in mind here.
1:26:50
And for some of these large companies, um, you know, they do want to invest in talking to users, but it's just so complex because there's a lot of bureaucracy even to reach out, um, to a user.
1:27:01
You kind of have to go through legal and and it becomes too complicated and that's why they have to use these consulting firms to kind of go through it.
1:27:10
But we've been able to kind of streamline the process.
1:27:14
Can you talk about uh how these interviews happen today and how they'll evolve?
1:27:19
I can imagine chatbot interaction to begin with, but at the like the the voice interfaces are pretty close, virtual avatars are getting pretty close.
1:27:28
Uh what's the product like today?
1:27:30
Where do you see it going? Yeah.
1:27:33
So we F and I we actually like started a company by virtue of you know trying to solve the problem for ourselves and um we had this AI consumer app that had 20,000 downloads in one day and it really blew up out of nowhere.
1:27:48
We were running with expensive GPUs spending like $1,000 per hour and it was our personal credit cards attached and like the users were charging really fast.
1:28:00
So we're like, okay, how do we actually solve this problem?
1:28:03
And then we we built a very simple prototype.
1:28:05
It was a chatbot that could just talk to all the users and summarize what they wanted.
1:28:11
And we found things that were really useful like which template should we add?
1:28:16
How should we fix our onboarding?
1:28:17
And now we have built out this kind of entire um stack where it's essentially three steps.
1:28:24
It's first interviewing and we do that over video and have like the video understanding both of the emotional like experience and the what they do on the screen and then it's finding the people.
1:28:36
So we actually allow you to kind of find all the customers through a database of millions of users and then of course analysis and the ceiling for analysis is really high.
1:28:47
you can hire Mckenzie and they'll charge you a million bucks to give a a PowerPoint deck and uh yeah, we're we're working on that.
1:28:57
That makes a ton of sense.
1:28:57
How how many what are some kind of edge cases or or companies that you you would expect to start using listen that that maybe are non-traditional?
1:29:05
Like I my immediate thought is that we should throw up like you know basically a number that you can just call and uh give feedback on the show.
1:29:12
uh which you know we we're live uh 15 hours a week so it's hard to find time for phone calls but it would be awesome if people could call in and be like hey like talk more about this or you know uh things like that but um how uh yeah do do you see this type of um user research expanding into industries that maybe just aren't customers of these different consulting firms today just because of the the costs? Yeah, exactly.
1:29:39
I think there's a huge new market you can uh open up for, you know, smaller companies or companies that couldn't traditionally afford or couldn't even honestly wait for 12 weeks until you get like this report back.
1:29:48
Um so I think that's very exciting.
1:29:51
so I think that's very exciting. But if you take a step back and think about you know what makes a great company um and you can even go back to YC of you know what they think is like we mentioned it before right code and talk to talk to users and you know that's really the core but those two parts you know we
1:30:06
have the writing the code which now AI agents are doing more and more you know it's getting easier uh to to build things so what becomes more important is actually building the right thing and kind of having the feed uh feedback talking to the customers so that's what we're building And you know, it's almost scary, but maybe in the future that's that's what we're going to do. Like that's maybe the
1:30:26
Like that's maybe the last thing that humans will do.
1:30:27
Like kind of telling the AI what to do, uh, what to build, being the taste makers which podcasts to listen to. Yeah. Yeah.
1:30:36
Just wire it directly into cursor or Devon and then it just takes the feedback and immediately implements the change.
1:30:41
No, it is it is an interesting scenario to think about where where listen is directly integrated into the into the basically developer tools where somebody can say like hey I want a feature to do this and then it just immediately you know gets built. Yeah, pretty awesome.
1:30:57
I'm sure you guys are thinking about on the on the post interview analysis side.
1:31:00
I can imagine that AI is very good at aggregating sentiment and tagging things essentially creating like the top 10 requests, the word clouds.
1:31:12
Um, but uh have you found LLMs or any of the modern AI tooling being useful in finding like the diamonds in in the rough?
1:31:19
Like uh everyone's telling you to build a faster horse.
1:31:23
there's one person who's clocked it and says, "No, you got to go into the automobile for your product."
1:31:28
Uh, and and you're able to dig that out with uh modern technology. Yeah.
1:31:35
Um, so we we have like a module that finds surprising statements and outlier sentiment.
1:31:41
And I think there's also interesting things around kind of building a profile of understanding who this user is and if they give good advice or not.
1:31:51
And we actually have like a quality score of each participant.
1:31:53
So you shouldn't listen to all feedback.
1:31:58
Um, and as we've done more interviews, we've done now more than 300,000, we can kind of build a elite set of taste makers essentially that you can reach out to that tend to give like great advice. That makes sense.
1:32:13
Uh, how how did the round how did the round come together?
1:32:16
Obviously got basically the who's who of uh venture in.
1:32:19
Uh was anything surprising?
1:32:22
Was it uh uh you know did did you guys go go out to run a process or did did people come to you?
1:32:28
Uh well it's a very competitive fundraising market for the for the business today.
1:32:36
Um but you know we're we're very uh lucky to work with exceptional partners and Brian Shrier at Sequoia.
1:32:43
He also led the first investment in Qualrix which is the biggest outcome in in the customer feedback world.
1:32:50
Um and then it's amazing working with Mike Bernal at Conviction. Yep.
1:32:59
um who's done yeah the best deals uh when uh when listen has as big an outcome as Qualrix what pro sports team are you guys gonna you guys going to buy yeah I actually spoke to I'm from Sweden I spoke to Brian Smith at Qualrix and
1:33:15
the first thing he said like oh yeah you you uh I just bought a hockey team you guys you guys love hockey right so maybe I think table tennis that would be table tennis table tennis what is the most popular sport in Sweden right now. Yeah. Yeah. Um maybe chess boxing. No, table tennis. I don't know. Table tennis. Table tennis. It is very popular.
1:33:35
We we went uh we almost won the Olympics. China. Yeah. Oh, that's rough. It happens. It happens. Um awesome guys. Well, congratulations. Very exciting.
1:33:47
And uh let us know when we when it's ready for for podcasting, you know. Prime time. We'll roll it out. Uh take care. We'll talk soon. Bye. Right. See you. Great.
1:33:59
And we got an ad for EightLe. Go to eightsleep. com/tbpn. Get a pod4 Ultra.
1:34:07
They got a 30 night free trial, a 5year warranty, free returns, free shipping. Go check it out. Oh, 100. I close.
1:34:13
Uh I don't know how this is possible.
1:34:17
I think uh autopilot was doing the work.
1:34:19
Uh my little one was uh throwing up last night.
1:34:25
Um, it's rough, but uh so credit to uh my wife, real real MVP uh for uh getting uh her taken care of. But um who we got next?
1:34:38
Uh we got Eric from Free Form coming into the studio.
1:34:41
Um talking about uh manufacturing going back into hard tech.
1:34:48
Thursday tends to be a little bit leaning heavy on the hard tech.
1:34:53
Every once in a while we got Delian kicking it off and then we try and bring in some robotics, some manufacturing founders.
1:34:58
Always an interesting discussion to have with those folks.
1:35:00
Um we are uh talking to Formeck as well.
1:35:07
They're doing robotics and uh I'm sure we'll talk to many more.
1:35:09
Although we've hit a ton of the companies at this point.
1:35:12
When you do 20 interviews a week, uh you can you can create a market map pretty quickly. You can churn through. We are the market map. We are the market map.
1:35:20
America is our market map.
1:35:20
Well, let's bring him in. Eric, how you doing? Welcome to the stream. Doing great.
1:35:26
Thanks for having me, guys.
1:35:26
Yeah, thanks for thanks for hopping on.
1:35:28
Um, would you mind kicking us off with a little introduction on yourself and the company? Absolutely.
1:35:32
Uh, so, uh, Eric Balich, CEO, founder of Free Form.
1:35:35
Uh, we do, you know, really we're bringing AI to metal 3D printing.
1:35:40
My background was early employee at SpaceX.
1:35:43
Worked there for over 10 years.
1:35:45
I ran the Merlin engine program for Falcon 9 and the Raptor program for Starship and kind of saw the potential of 3D printing, metal 3D printing firsthand.
1:35:54
Um, and then left to go and and and actually drive it into, you know, industrial commercial use. Yeah.
1:36:00
Uh so uh I'm assuming you were a key player in ma in in transitioning the sort of uh engine from this like you know crazy blob you know we'll try to pull the image up on the screen.
1:36:15
Uh was 3D I I imagine was was 3D printing you know part of of how you guys were were iterating or were you not able to leverage the tech that that you guys have now? Yeah.
1:36:28
have now? Yeah. No, it was I think the the thing that I saw was the enabling you know potential of 3D printing but how slow and crappy it was to be honest like we were doing things with Raptor that you know we were inventing we were we were you know innovating in the rocket space for the first time in decades truly people think rockets are
1:36:49
super um complicated but really the technology hasn't changed much in a long time then this manufacturing technology comes along that allows you to control physics in a different Hey, I mean true true if you look at the way you make metal things um really there haven't been these new disruptive technologies in a really really long time. So you
1:37:06
So you know printing enabled Raptor which I would argue is the mo one of the most amazing um and high performant rocket engines ever in the history of humanity. Yeah.
1:37:18
Can you talk about how metal 3D printing actually works?
1:37:22
I think I'm I'm familiar with uh like kind of consumer level 3D printing and that makes sense to me.
1:37:29
You melt some filament and it's basically melted plastic through a metal nozzle.
1:37:33
If you're melting metal, doesn't that melt the nozzle? How does this all work?
1:37:38
So, we use lasers uh to melt metal powder layer by layer. Okay.
1:37:42
And so you think of it, you're just slowly building, you know, layer upon layer upon layer of uh you put a layer of metal powder out and use a laser to kind of selectively melt where you want and then do that again and again and again. Yep. Yep.
1:37:55
And then uh how do you think about the decision to uh manufacture a part using subtractive manufacturing versus additive manufacturing?
1:38:03
I'm sure, you know, you're obviously very bullish on 3D printing, but there must be limits and things that you say, "Hey, we're not just going to go 3D print a whole bunch of like rebar because we can just we can just mold that or something."
1:38:15
I don't know how it No, that that's exactly right.
1:38:18
I mean, I think one of the things that sets Free Form apart from um I I think really every other 3D printing metal printing company out there is we aren't developing the technology because we think it's cool.
1:38:28
You know, we're not pushing for 3D printing because, you know, it's cool.
1:38:32
We don't print pencil holder, you know, bottle openers, pens and pencils.
1:38:37
We just don't do that stuff because frankly like people don't care.
1:38:40
The to get to your question specifically, it's like what is it actually good at?
1:38:44
What is the value proposition of the technology?
1:38:45
And and it's truthfully today amazing for very complex geometries, very complicated things.
1:38:53
Um, and we're very candid with customers about should you machine it, you know, subtractively make it or should you print it.
1:38:59
you know what we're doing is enabling um the the next you know the we've built the fastest highest volume metal printing platform on the planet.
1:39:09
Um we have it here in Hawthorne.
1:39:11
We're about a/4 mile from SpaceX.
1:39:11
Um you know I would then say we we you know our primary customers are some of the you know most exciting and innovative aerospace and defense companies out there without naming any specific ones name.
1:39:25
Um, and you know, we're right down the street and you know, our our take on it was to commercialize the technology, we need to be able to do high volume, you know, and then by doing high volume, then we can bring the price down, you know, um, and and that was the thesis actually was got to do a lot of volume and and bring the price down.
1:39:42
Can you talk about uh your business model?
1:39:43
Are you selling the finished product or are you selling the machine?
1:39:47
Uh, or are you thinking about that in in kind of different stages?
1:39:51
Because I imagine in the future like a end customer would just have one of your devices and and they could operate it themselves.
1:39:58
Is that where you're going? Yeah. Uh no.
1:40:00
So that's a great question.
1:40:02
The business model is we just provide turnkey parts.
1:40:06
So we actually handle everything.
1:40:06
Um we print them if it needs post machining, it needs holes reamed, it needs surfaces turned, we do all of that um inhouse.
1:40:16
all the metrology, you know, we'll do CMM inspections, high-res 3D scanning, anything the customer needs.
1:40:20
We, you know, the whole thing, the industry is really complicated and fractured.
1:40:24
And so when we went out, you know, six, seven years ago and started figuring out, hey, what is the right business model in the space, I kept my my head, my brain kept going back to and and by the way, I worked directly with Elon for my entire career at SpaceX.
1:40:39
So this first principles kind of thinking that everybody says they do, I feel like I was indoctrinated in the actual school of it, you know, by him.
1:40:47
Um, you know, but I kept thinking like, man, you know, we're melting stuff with a laser and it, you know, we care about single-digit microns of of precision.
1:40:55
This isn't, you know, traditional metal manufacturing.
1:41:00
Like this isn't a CNC machine.
1:41:00
So customers, you know, why are they so unhappy with the space?
1:41:04
And and when they buy a machine, why are they disappointed?
1:41:07
because they don't know how to use it.
1:41:09
It's so it's more akin to like semiconductor fabrication than like subtractive manu you know metal manufacturing.
1:41:17
So we said we need to own all of it then and to to answer the question. Yeah, that makes sense.
1:41:21
Uh what what is uh you don't have to go into super explicit detail but I'm curious how you think about you know margins.
1:41:29
A lot of uh V, you know, traditional software VCs have have sort of been chirping on X over the last couple years.
1:41:37
Hey, you're putting hundreds of millions of dollars into these manufacturing businesses, assuming they're going to have, you know, uh software margins and that that hasn't been the case historically.
1:41:46
Are you guys getting so efficient that that you can achieve kind of greater margin profiles or is it just about sort of scale? Absolutely.
1:41:55
I mean, that's exactly where we're at today.
1:41:57
Our margins are fantastic.
1:41:58
Um and the technology is fundamentally new and enabling which means you know I get that question a lot.
1:42:05
It's like well even if you can charge higher margins now isn't this a race to the bottom?
1:42:09
The answer is um you know that that is true over a long time scale for any industry right anything that gets commoditized over 50 or 100 years and highly optimized it it ultimately becomes a race to the bottom.
1:42:23
The question is how long and the technology that we've developed and the capabilities that we have um are enabling new products new they're enabling innovation in in industries that are you know we're providing the tools that people are truly like innovating uh on the design and and and and integration fronts.
1:42:40
So um and performance and so you know I think um uh as long as we continue to stay at the front of that and the techn is getting better every day.
1:42:49
when I say, you know, I don't love to to use AI buzzwords, but we that is what we're doing.
1:42:54
We're we're bringing like AI to to to to 3D printing such that the next part coming off the platform is even better than the last one.
1:43:04
And and so, you know, because of that and the process is constantly getting better and we're coming up with new materials and new features and new functionality, then, you know, I think I can make the argument that the margins will stay high for a very long time.
1:43:16
Um and and especially when you start looking at the the places where, you know, we've developed technology that fundamentally unlocks the ability to develop new materials, you know.
1:43:26
So now we own the material, we have the the technology to actually leverage it and then it enables something important, you know, maybe in the semiconductor space or in the in, you know, the rocket space or even the automotive space. Yeah. Yeah.
1:43:42
in that in that new materials.
1:43:42
I mean, I've I've talked to some people who do the subtractive manufacturing with CNC and there's like different types of aluminum, different alloys.
1:43:49
Like, is that something you're already uh doing?
1:43:52
And do you just handle that for your customer?
1:43:54
Are you testing different uh like alloys?
1:43:55
Is that how you think about that or or what do you mean when you mean new materials?
1:44:00
Yeah, our business model today is not yet de truly development of new materials. Okay.
1:44:07
Um that it's we've done some of that.
1:44:10
We work with a another very large well-known customer that I would say is in the general broad family of customers that you know we won't mention specifically that um we've been working with them on development of some new alloys that enable you know I think um some pretty cool things for them and uh but that's like not that's more of a one-off today.
1:44:31
It's it's the the reason why they're interested in working with us on this is because we've developed the sensing and compute platform and have the the data sets and the the sensors to actually uh engineer and develop the materials at the metallergical level that no other printing company has.
1:44:47
I mean, you know, Free Form is uh really it's it's in the 3D printing space, you know, we're we're like SpaceX, you know, the the the the mindset of um of those organizations and talent of those organizations.
1:45:00
you know, the metal manufacturing market has generally been viewed as this kind of like stagnant I dimly lit, rusty, you know, oily machine shop.
1:45:08
Um, so we had to go out and find, you know, like rocket scientists to develop the technology, you know, to be able to do this, you know, and that's one of the reasons why like Nvidia made a a substantial investment in us recently is they saw what we were doing on the compute and data side and they want to be a part of it.
1:45:25
What are the different vectors of optimization in metallurgy?
1:45:27
vectors of optimization in metallurgy? I imagine cost and weight and strength are important in space but like is electrical conductivity important like what else is important uh to think about when you're thinking about the material either that you're selecting or eventually uh kind of building from first principles absolutely it depends
1:45:47
on the application you know um it for for example like uh heat exchangers you know metal printing is very good today even at high cost if for a conventional like other shops or or if you're buying the conventional machine, um it's very good at very very complicated geometries that you either can't make any other way or they're, you know, prohibitively expensive or difficult to make any other way. And those do generally fall in a
1:46:10
And those do generally fall in a couple categories.
1:46:13
They're like fluid components or heat exchangers, things that you know, thermal uh devices.
1:46:17
Um and so in in an application like that, you care a lot about, you know, the thermal performance of the material.
1:46:23
In other cases, you might be putting parts inside a gas turbine engine.
1:46:28
This is another typical application for 3D printed parts.
1:46:31
And in that case, you want something that's like strong when it gets hot, you know.
1:46:35
Um, so there are it really does depend on, you know, the application.
1:46:40
And I think the the thing for us is we actually have the platform and the feedback and the analytics to be able to close the loop on whatever the particular, you know, uh, uh, feature of the material or application that you need. Yeah.
1:46:54
You I mean you mentioned uh putting a 3D printed part in a gas turbine engine.
1:46:58
We've been hearing that uh China's been having a lot of trouble manufacturing planes to compete with Boeing specifically jet engines. Yeah.
1:47:07
Why is a jet engine so hard?
1:47:07
Can you just 3D print 3D print it at some point?
1:47:11
I mean I imagine that like China is Why is it so hard, Eric?
1:47:14
Why did it take you 10 years to figure out how to do like can't you just like put the like scan the 747 and then print the 747?
1:47:20
It's a It's a copy machine.
1:47:24
That's what you're Exactly. Exactly. Someday. Yes.
1:47:25
That I mean, you know, the the vision for us at Free Form has always been um to take the you know, the complexity out of it and to provide a you know, a a lights out a truly everybody says automated factories, you know, to provide a lights out factory that is truly automated.
1:47:43
The unique thing about metal printing is this is actually possible.
1:47:48
CNC machining and other subtractive methods that there's no way to do to truly do that.
1:47:57
Um there's just there they're there just today there is not um printing we're already entirely digital.
1:48:01
It's like take a digital file the machine doesn't care what you're printing it just prints it you know and then automating the rest of that.
1:48:08
And then you mentioned China.
1:48:08
So obviously the joke about why are gas turbines hard you know I don't think gas turbines are hard.
1:48:13
I think rocket engines are harder.
1:48:14
Um gas turbines you know are easier in a lot of ways.
1:48:17
Um but the the you know China is a good example where you know I get quite frustrated that you know we are we are a a manufacturing technology company that is developing capability that is not only going to affect and improve the lives of of people uh in general but also is critically important to our national security as a country.
1:48:39
Um and you know China is investing in the 3D printing space.
1:48:44
um they are building you know huge factories full of these conventional machines.
1:48:48
They don't have our technology.
1:48:50
They don't have the ability to you know they can go make 100 laser whatever number laser machines.
1:48:57
Those parts are still junk.
1:48:57
Um and you know we are developing this in the US for the US.
1:49:03
Uh we obviously do quite a bit of defense work and it does get frustrating.
1:49:06
frustrating. You mentioned China and it's like I had to put my plug in of you know it's frustrating that I do feel companies like ours there was a question earlier about software margins and businesses and VC stuff you know yeah we're not a software business but then the interesting thing about free form is
1:49:22
it's where the bits and the atoms um are combined which I think makes us even more interesting you know you want your 5,000x 10,000x 20,000x company you get it at a company like this at at free form you know you're not going to get that can you talk about some of the stress of of working with space companies. I imagine like, you know, you
1:49:39
I imagine like, you know, you guys aren't doing launches yourselves anymore.
1:49:43
You're probably more relaxed than you were when you were at SpaceX, but at the same time, I'm sure you get, you know, a call or an email now and then being like, "Hey, we need this by, you know, uh, Sunday night at this, you know, specific time because we're going to space."
1:49:58
uh you know what's it like kind of like working you know with with end customers around that type of business?
1:50:05
No, that's also a great question.
1:50:07
Uh the you know truthfully I'm probably more stressed now than I was when I was sitting face to face with Elon three times a week.
1:50:16
Elon three times a week. Um because because I feel like the the scope of what I focus on today is um I don't know actually I can't I don't the scope of what I focused on there was like I kind of knew you know where I was here it's
1:50:33
like all over the you know top to bottom you know everything kind of ultimately falls on me uh in some capacity the but it is stressful we get this with exactly what you just said all the time you know we get a call from customer X that says, uh, hey, guess what? We tried to get
1:50:50
We tried to get these somewhere else.
1:50:52
This supplier let us down.
1:50:55
You know, can you guys hook us up and get these done by Sunday?
1:50:57
Um, that can definitely be stressful.
1:50:59
I think also, you know, the nature of a startup, especially one with as many moving parts as we have.
1:51:04
You know, I think you'd be hardressed to find a company that's more vertically integrated than us truly and does as much as we do in house.
1:51:11
Um, you know, with such a small number of people actually today still.
1:51:15
Yeah, you know, we're building the plane while we're flying it.
1:51:18
So, you know, at the end of the day, um, we deliver on time and we've started to build a reputation and and, you know, if you will, like a brand with these important customers that they come to us when they want their problem solved.
1:51:30
You know, they come to us with the hard stuff.
1:51:32
Um, and and when they they can rely on us and we do everything we can to make sure we deliver on, you know, before promise and better be, you know, exceed expectations. Yeah.
1:51:40
Do you do you uh do you feel like you have an edge?
1:51:44
Uh I I imagine a lot of your competitors are, you know, family kind of multigenerational companies andor private equity owned and like I just feel like you're clearly in a very different you know mindset right of like you know uh to to to say the the meme but like founder mode like we need to overd deliver.
1:52:04
We need to constantly be faster like it's not enough to respond to a customer in two hours.
1:52:09
We need to respond in 30 minutes max. Like that kind of thing.
1:52:13
is that um you know I think uh we've heard about uh uh from various uh founders on the show that you know when they email somebody in China even if it's 2 am for them they respond instantly in America they might get a response two weeks later and it's like fill out this form.
1:52:30
So talk about kind of like bringing that sort of like mentality that you have to um to this industry 100%.
1:52:38
So I feel that we have an unfair advantage um for a bunch of reasons.
1:52:44
I think I was raised in the school of SpaceX.
1:52:46
You know 2005 um you know early on there were there were 50 people um 60 people.
1:52:51
I was there until there were 10,000 people.
1:52:55
Um and you know I think that that the things that I learned that that are just second nature to me of immediate you know you do it now.
1:53:05
Call people on the phone.
1:53:07
This is something that's been lost.
1:53:07
um you know over the last several years and I and I and I do see it.
1:53:11
You know we hire you know we're hiring we interview all the time. This has gotten lost.
1:53:14
Um but that is something that we have that I don't think the rest of the 3D printing space you know the industry has.
1:53:22
You know we don't advertise a lot.
1:53:24
In fact we very intentionally do not align ourselves with the traditional metal printing.
1:53:28
You know I'm not trying to alienate anyone but you know we're just I don't even want to be compared because it's not even fair.
1:53:34
um we have done so much more and moved so much faster with so much less money than the rest of the whole industry and there there's just so much noise and I just don't I don't I don't play that game.
1:53:48
Um I'm like come see it for yourself if you want to see us printing parts super fast.
1:53:54
You're welcome to come over and and actually see it.
1:53:56
I'm not going to put put together some pretty marketing stuff and you know like just do it.
1:53:59
So I I do think you're you're entirely right like the mentality is everything.
1:54:06
Culture of the company and and the way that you enforce that culture and reinforce that culture is is is very important.
1:54:12
Can we zoom out a little bit and talk about the 3D printing industry broadly and where and where you think it's going even at a consumer level?
1:54:18
I feel like 10 years ago, uh, there was this sense or at least like, you know, 3D printing companies were promising, hey, like you're not even going to have to order that toy because you're just going to have a 3D printer in your home that just sort of like prints it on the fly.
1:54:34
And I and that clearly hasn't happened. Yep.
1:54:37
Um, and it was a good fundraising narrative, but I'm I'm curious as somebody who's doing this all day long again in a specific niche, but I'm curious how you think uh about the industry evolving over time and and consumer use cases. Yeah, 100%.
1:54:51
I mean, I think like I had plastic printers, too, you know.
1:54:57
Um, before I even I was never a a guy, you know, I saw the potential of printing when I was designing and architecting like Raptor and Starship and, you know, there were three of us sitting talking to Elon about how we're going to colonize Mars and I'm like, we're going to have to make, you know, we're not going to carry like bar stock and machine it on Mars.
1:55:18
You know, we're going to have to use what's there and turn it into, you know, the minimum material we need and then make it.
1:55:23
So the conceptually the idea of of additive manufacturing, which I don't even like that name, but um I is is seems legit, you know, like use what you need and just make the shapes you need and you can grow it organically like nature.
1:55:39
Nature is usually a good model for things.
1:55:40
Um that all makes sense to me.
1:55:43
The the I do agree like the overhype by others in the space.
1:55:48
In hindsight, you look back and you're like, "Yeah, of course that wasn't going to be what happened."
1:55:53
You know, plastic printer prices dropped.
1:55:55
People started buying them with this promise that they were going to be able to print all these things.
1:56:00
You bought the thing, you built it, you printed a pencil holder that you downloaded off the internet, you realize, I don't know how to do CAD or have access to CAD tools, so I'm downloading models from others.
1:56:10
It's just a novelty space, you know, um, and I think has been for a while.
1:56:14
metal printing at least had its roots in something more real um that I think there was potential there, but we were clearly so far away from, you know, where we needed to be because the the the the behind the scenes customers are buying these million-dollar machines and then having to hire PhDs to operate them to get maybe one out of every five parts over the course of a month. That might be good.
1:56:40
You know, it's just so far away.
1:56:42
Um, and one of one of the reasons for that, by the way, I do believe is because they tried to monetize on the machine itself.
1:56:49
They were like, "We need to make this million dollar box and then sell this to customers."
1:56:53
And I think that was one of the mistakes was that's why we rewound and said, "Hey, if I can unwrap the box, if I don't have to sell a box to a customer, as dumb as this sounds, if I don't have to sell them this self-contained box, now what can I do?
1:57:08
I can rethink how the process is done.
1:57:11
I don't have to have put my powder on in a little spot in the corner anymore.
1:57:15
I could use half the room if I need to.
1:57:17
You know, what is the right first principles way to do what I'm trying to do as efficient and fast as possible and then let's engineer a solution for that.
1:57:24
So, you know, yeah, such a better uh B2B experience is just paying for the end state uh versus, you know, trying to but I'm curious to push you a little bit further.
1:57:35
you a little bit further. Do you think that end state of you know like just like people today might have a printer in their home you know every home in America has a 3D printer you think that's a reality 10 15 years from now uh
1:57:49
I can imagine AI you can now generate a a CAD uh file that that or or is it just kind of like still going to be unnecessary and inefficient you know that's a great question uh part of me wants to feel you know the future is these are always interesting things to think about, you know. Um I my gut tells me that
1:58:07
Um I my gut tells me that um we should we should uh centralize and and it's a service.
1:58:17
I feel like the world is going to you know the direction is you own less and less.
1:58:21
Look at like tur your cars.
1:58:23
It's like you got people now that literally don't own cars anymore and they just like rent the service. Why? Because it's easier.
1:58:28
It's it's not because they don't know how to drive.
1:58:32
They It's just easier, you know?
1:58:34
So ultimately if you make it easier and you make it cheaper and and you can take advantage of economies of scale I think that that probably makes more more sense.
1:58:42
And then you know to to be clear like we the vision for free form was always to be more than just a metal printing company.
1:58:49
You know, I think the the the concept at least at the beginning in in my head was let's dominate the enabling manufacturing technology.
1:58:57
technology. Then let's let's solve the how do I go from the printed part to the end to the end use part that can just be plugged in via make the printing process better post machine it you know heat treat whatever let's solve that problem end to end and then let's vertically
1:59:15
integrate on some products um because at the end of the day why would I you know there are there are some some specific areas that we're starting to um do some things in that are quite interesting that our technology, our approach uniquely enables that. I think you know
1:59:31
I think you know ultimately that's where the money is to be made um up and down the stack but the progression kind of makes sense. Yeah, that makes sense.
1:59:40
Uh last question on my side, have you seen any interesting upticks in demand or interest from the tariff uh the the the trade war or just given the nature of your existing customer base focusing on aerospace and defense?
1:59:55
I can imagine a lot of your customers just aren't too impacted given they were already focused on sort of having US supply chains. Yeah.
2:00:01
No, we actually have seen quite a bit of uptick um since the tariff stuff is happening there.
2:00:09
It seems like there were a lot more companies out there, you know, relatively bigname ones that were doing a lot of business with China specifically more than I was aware.
2:00:18
specifically more than I was aware. um you know given some of the recent they try to advertise that you know they're not yelling from a rooftop they don't yes which is interesting uh but yeah to answer your question directly we have definitely seen an uptick um and and I
2:00:34
think it's it's also as word has started to get out about us in the space I think you know because we've have kind of flown under the radar for quite a while um you know I think people are now starting to hear about us and you know and I feel like they should be worried you know about what we're doing and and our pace and like ability to disrupt. They should be so good. I I have a They should be so good.
2:00:54
I I have a couple more questions.
2:00:56
Um yeah, but first uh 3D printing for a long time had this stigma around it as uh it's great for prototypes.
2:01:05
Uh but at a certain point, you're going to want to switch to a different manufacturing strategy.
2:01:10
Um, are you seeing customers come in and say, "Hey, we just want to work with you for a little bit on the manu on the prototyping side and then maybe we'll do something different and then do you have to kind of walk them through the vision or is it very clear upfront that hey, this is about scale.
2:01:27
The the the the part that we're making for your rocket or your plane uh in 20 years, it's still going to be coming off of a free form machine because that's the business model." Yeah. Abs. Absolutely.
2:01:38
Um so we do also um we our business is not exclusively aerospace and defense.
2:01:43
It's a large portion of it but we do do automotive work.
2:01:48
We work with semic several semiconductor companies.
2:01:50
There's some other kind of energy um you know I'll put in the energy sector kind of companies we work with that are interesting.
2:01:57
Um and and yeah so I guess the uh I just completely blanked on the question.
2:02:04
So, so the question is is uh is prototyping versus scaled manufacturing.
2:02:09
I imagine at a certain point like automotive.
2:02:11
Uh if I would, you know, if I'm a car manufacturer, I'd love to come to you and say, "Hey, let's prototype a bunch of parts."
2:02:18
But then once I get it dialed in, I'm I like the the historical example would be, oh, then I'm going to go get it, you know, subtractive machine or cast, right?
2:02:28
Uh, but at a certain point it sounds like, hey, I want to make a th 100,000 cars this year and you're going to say, yeah, I'm along for the ride and I'm going to be cost competitive.
2:02:38
But have you had to is that the right thesis?
2:02:40
And have you had to uh walk customers through that? Yep. Exactly. Yes.
2:02:45
So, we generally turn down today, depending on the company and the potential, we turn down a lot of the prototyping stuff. That makes sense.
2:02:51
um because it it just doesn't make sense for us to to to focus on that unless it's coming from a huge company that there's a something interesting that could come after real project. Yeah. Exactly. Yeah. Exactly.
2:03:04
We generally turn that stuff down.
2:03:05
Um we have the upfront talk with customers about the scale and that's the target.
2:03:09
Um you know that's what we're interested in.
2:03:12
That's that's how we're going to get you know uh economies of scale and the costs and down to where everybody needs it to be.
2:03:20
And ultimately, you know, I think one of the interesting things about the space, so I will say like from my time at SpaceX, I always liked solving these extremely complex interdisciplinary system level problems, you know, and these very very, you know, how do we colonize Mars?
2:03:36
And it's like a lot of people's brains will short circuit.
2:03:39
I don't even know where to start.
2:03:40
And weirdly enough, like I was always like, well, I'm just not smart enough to figure this out, so I'm just going to like assume that doesn't matter and assume that doesn't matter until I get to something that I'm I'm like, well, I can calculate this, so I'm going to start here, you know, and then just go from there.
2:03:54
Um the the interesting thing about printing as as we've started we have started to demonstrate the the the feasibility of truly scaling it up is that it starts to you start to think about the disruption of um even the product life cycles.
2:04:09
Like a lot of the product life cycle stuff today is centered around these very long manufacturing timelines.
2:04:17
So meaning like you know it's just and I don't have a conclusion here other than you know how much more often would products get updated or customized um if you didn't have to wind up a 12 months of tooling in uh in a in a in a casting facility, right? Um yeah.
2:04:35
Well, speaking of that product update, I imagine that you're you're building the machine and then you're also uh scaling up the machine and once you have a really solid contract, I imagine that then it's like, okay, well, we're going to want to like this machine is capable of doing this part and we want to do that at volume.
2:04:54
Uh so what is your product release cycle on the actual machine side?
2:04:56
Uh because are you are you freezing and then doing a v2 v3 or are you upgrading the machines iteratively?
2:05:03
What does that look like?
2:05:04
We do a little bit of both actually.
2:05:06
Um we do we do some level of upgrading on the the so there's a road map that was like the first thing we ever built was just uh can we put a bunch of lasers on a thing and melt stuff pretty fast.
2:05:18
You know it was it was not designed to be a throughput maximizer or it was small. The platform wasn't big.
2:05:26
It was just like can I put a bunch of lasers in a small area and and melt stuff quickly.
2:05:31
Um the second thing was then can I take that and scale it up to something that's actually useful in size and start to demonstrate this uh some of the architectural elements of the system that enable the lights out factory like uh how do I you know unpack and get the parts out and get them off the plate and get them ready for you know the next steps or whatever it needs to do.
2:05:53
The third step of that is has been to go even bigger and that's what we're building actually right now.
2:05:58
we're building actually right now. Um so we went from you know I I don't remember the exact number of throughput capability from gen one to two it was something like 20x from 1 to two and then two to three or I I I came from
2:06:12
SpaceX so everything starts at zero so zero to one you know one to two what we're building now is basically the third uh generation of the technology and this is the one that is um the platform is quite large um like the size of this of this platform is is is is is for what it can do. It's tiny um
2:06:30
It's tiny um compared to the industry, but it's it's pretty large.
2:06:34
They make these huge parts and it's like 10 to 20x higher throughput than even the system we're using for production today.
2:06:40
Um so, you know, we've basically taken these huge steps um every every generation.
2:06:45
And then there's the the the inter in incremental improvements which are predominantly around software generally um because we're implementing better models, faster compute, faster sensors and we're rolling those out in real time.
2:07:00
Luckily I came from the aerospace industry, you know, I led certification of Falcon 9 and Merlin uh um uh for for the Air Force and NASA.
2:07:07
It's like I you know so I can talk to the aerospace folks.
2:07:11
I can talk to the defense folks.
2:07:13
I know what they're looking for in terms of product release, you know, that that uh uh uh uh you know, hardware in the loop testing and then releasing software versions, locking certain things down for production and having control of that.
2:07:25
Um so that that's been helpful, too, to kind of you know, grease the wheels of that with customers that are like, "Oh, wait.
2:07:31
You're changing stuff all the time."
2:07:32
Like, no, not not exactly. Um but yeah.
2:07:33
Uh last question, I'll let you go.
2:07:36
I don't know if Jordy you have anything. Are you good? I'm good.
2:07:39
Um, I I'd love to know um a few pieces of advice or lessons that you took away from working with Elon that folks might be able to apply even if they don't have, you know, a decade of experience at an actual Elon company.
2:07:54
What do you think is actually actionable? Oh man.
2:07:55
Um, boy, there's a there's quite a bit.
2:07:58
Um, surround yourself with the smartest, most most accomplished people you can in general and then listen to them.
2:08:04
Um secondly, there's no problem that we can't solve together.
2:08:09
Um you you you know people are their biggest u you know this is easy to say too, right?
2:08:15
And hard to put into practice, but you know, you're your biggest enemy.
2:08:18
If you think you can't do it, you definitely can't do it.
2:08:19
Um and then question everything. Question everything.
2:08:24
Um you know, Elon is an extremely smart man.
2:08:27
extremely smart man. I feel obviously like very fortunate um to have had the opportunity to work at SpaceX for so long and sit in the room and see how he makes decisions and you know and and the good and the bad you know I mean all of it I I just I had a good experience at
2:08:43
SpaceX um and and learned a lot and and a lot of you know even Free Form today there are a bunch of current and former execs at SpaceX that are investors um in Free Form and uh among obviously Founders Fund and you know 8V VC and Valor and a bunch of, you know, top tier um um investment firms, Threshold and Two Sigma. They'll all get mad at me if
2:09:04
They'll all get mad at me if I don't list them all out. Just keep the credit.
2:09:07
I got to say, Eric, uh you make me believe in onoring manufacturing. Yes.
2:09:16
When I talk to you, I believe that it's possible.
2:09:18
It's easy to to to be blackpilled and say, "No, we're never going to make it in America."
2:09:25
But I feel like if we just give you like another 20 years, we'll be able to make anything.
2:09:29
It sounds chaotic dayto day when you read the headlines, but when you actually talk to someone who's working on this and who's clearly going to be working on it for decades more, it feels tractable. Yeah. Yes. It's totally tractable. Yeah. Yeah.
2:09:42
Anyway, uh thank you so much for stopping by. This is fantastic.
2:09:43
We have to have you back.
2:09:45
Uh that this is this is really really enjoyable. Thank you.
2:09:48
Would be a pleasure, guys. Absolute pleasure.
2:09:50
Thank you so much for having me. Thank you. We'll talk to you soon. Bye. Cheers. Sounds good.
2:09:53
Uh, and if you're trying to sell some 3D printed metal parts all across the United States, you got to get on numeral.
2:10:01
Numeral HQ, sales tax on autopilot.
2:10:01
And I have some breaking news. Breaking news.
2:10:05
My company, Lucy, is now on Numeral. Let's go. Double kill.
2:10:09
One hand washes the other. They pay me, I pay them.
2:10:15
What the the money goes into my pocket and back into Numel's pocket. There we go. Uh, it's great.
2:10:20
But we have been uh keeping our next guest waiting. We will bring him in.
2:10:25
We're talking about robots with Formic. Uh forco is the website. Let's pull it up.
2:10:35
Full service robotic automation for Z capex.
2:10:38
That's what we like to hear.
2:10:38
We love when capex is free. Welcome to the stream. How you doing today?
2:10:42
Welcome to the anti-capex club. Good to meet you guys.
2:10:47
Thanks so much for having me on. It's a great club. Yeah. Fantastic.
2:10:48
Uh, can you introduce yourself?
2:10:50
Give us a breakdown of the company, where you're at, and what you're building? Sounds good. Yeah. Uh, my name is Salman. I'm the CEO of Formic.
2:10:57
Uh, we're building the robot army that is helping American manufacturers automate.
2:11:02
Uh, you can see some of them on the screen behind me.
2:11:05
These are our robot babies, as we affectionately call them.
2:11:07
Uh, we have hundreds of them across more than 100 factories now in the US that are using our robots to produce all kinds of products.
2:11:14
So, we're making everything from metal parts for aircraft and automotive, plastic parts for lawnmowers and golf carts, uh, as well as things like food and beverage.
2:11:22
We we make all the all the nachos for Chipotle and, uh, uh, dog food and cat food and laundry detergent. Uh, you name it.
2:11:29
You know, our robots are helping to make it.
2:11:31
You make nachos robotically. We are indeed. Yeah.
2:11:36
The last guy I heard Eric was on, you guys were talking about bring uh, bring manufacturing back. Like, it's real. It's happening.
2:11:42
Uh we're really excited to be part of it. Yeah.
2:11:43
What do you What do you have to say to the naysayers that say we'll never make it in America? The haters. The haters.
2:11:52
Look, uh I lived in China for 25 years and I saw the industrialization of that country.
2:11:58
And it's like it's not a two-year process, right?
2:11:59
Like industrializing is a a 20-year journey at the minimum.
2:12:03
Uh and and and probably much more.
2:12:06
And you know, we do have 250,000 factories in America uh that are making all kinds of products. So they exist.
2:12:11
Uh the problem is uh we don't have the labor force to support them, right?
2:12:16
It's not just about cost of labor.
2:12:17
There are millions of unfilled jobs in factories today.
2:12:19
The typical utilization rate of a factory in America is less than 2,000 hours a year.
2:12:23
Um this the the comparable number in China is 7,500 hours a year, right?
2:12:28
Like there's 8,700 possible production hours in a given year.
2:12:33
The vast majority of American factories are sitting around collecting dust 75% of the time.
2:12:37
Uh, and it's not because like there isn't demand for their products.
2:12:42
It isn't because there isn't raw materials available, right?
2:12:45
Like it bo basically just boils down to the fact that there aren't people who want to work in these factories and do these backbreaking jobs day in day out.
2:12:52
Um, and so until we automate a bunch of them, we're going to have a really hard time uh re-industrializing.
2:12:57
So, you know, I'm optimistic, Jordy.
2:12:59
I think there is a lot of opportunity to re-industriize and and bring more manufacturing back, but it's not going to be uh in a year or two, right?
2:13:05
like we're we're helping make that happen faster, but it's going to take some time.
2:13:08
Uh like a a really dumb criticism that I don't agree with of this company uh that might be completely wrong would be like, hey, this is just uh this is just financial innovation.
2:13:19
You're just you're you're you're swapping capex to opex that allows you to grow really fast.
2:13:24
I think that could be good for industization.
2:13:25
Um but uh how much of that is key to the business?
2:13:30
And then what else are you doing?
2:13:32
Uh I imagine that you're not uh you know mining the metal to make the robots.
2:13:37
Uh you might even be purchasing the robots from other people and then designing software suites and integrating.
2:13:42
Um but you know Palunteer goes to oh it's just a consulting shop or whatever.
2:13:45
Uh what is the criticism of your company of like of like where you're starting and then why is that the right path to start and then grow out from?
2:13:52
Yeah, I think it's a really good question.
2:13:54
Um I think it starts from like the basic premise that uh people most roboticists are working on the wrong problem. Right.
2:14:00
I I was a VC for 10 years.
2:14:02
I was investing in robotics companies.
2:14:03
I I funded like 50 different robotics companies and saw all the different ways in which they they had challenges.
2:14:08
And what I realized is like look, any roboticist will tell you uh getting a robot to do a job is 10% of the work.
2:14:15
Uh 90% of the work is like how do you do error handling and how do you solve all of the [ __ ] that happens after you deploy that robot. Yeah.
2:14:22
And I think that's the part that's generally underappreciated, which is like we'll see a robot doing a backflip in a cool YouTube video.
2:14:28
But once you try to robot, you know, 99.
2:14:32
8% uptime, um, you start to encounter all kinds of issues, right?
2:14:38
Joint failures, maintenance challenges, programming issues, your infeed, like your product is just has a lot more variation than you expected.
2:14:45
Um, and I think it's generally underappreciated.
2:14:47
And so the reason that factories in America don't automate today is not because you can't get a robot to do this job.
2:14:53
The problem is like all the surrounding infrastructure doesn't exist.
2:14:58
And so if you're the factory that focuses on making chocolate chip cookies, uh, and you're really good at the best chocolate chip cookie recipe and baking, like you're not also super good at deploying robots and managing them.
2:15:09
Uh, and so what happens is like they're just kind of overwhelmed.
2:15:11
They don't know what to get.
2:15:13
They don't know how to get it.
2:15:14
They don't know how to manage it.
2:15:14
They don't know how to maintain it.
2:15:15
Um and so uh what we realized is like you have to build all the surrounding infrastructure like robotics has this last mile problem where if you can make it easy to scope, deploy, manage and maintain the robot uh then you can drive mass adoption.
2:15:28
Uh and uh so we built a bunch of software that does that.
2:15:32
We do uh we use we use computer vision and LAR scans to do kind of full site evaluation in an automated way.
2:15:39
This used to take months to walk through the facility and measure every single thing to figure out what you can automate and and what kind of robot you need. We do that in minutes.
2:15:45
Uh then you need to figure out what robot to to to build and deploy.
2:15:49
So you need to basically simulate different robot arms doing that job with different grippers, different conveyors, different safety scanners, different fencing.
2:15:55
Like you need all this stuff uh to make a robot useful.
2:15:58
Then you need to actually program the robot to do the job.
2:16:00
And so we basically built AI that automates the process of programming the robot.
2:16:04
Um and then lastly, once that robot's deployed, you have kind of all the ongoing management of that robot, right?
2:16:09
So how do you do teleoperation?
2:16:10
How do you do error handling?
2:16:12
How do you do preventative maintenance?
2:16:13
um how do you gracefully recover from all the different types of errors that you're going to encounter?
2:16:17
Uh there's a ton of infrastructure that needs to be built.
2:16:22
And so like 90% of roboticists that I meet are working on how do I make the robot a little bit smarter.
2:16:26
Uh and nobody is working on this giant problem which is the reason the robots don't aren't deployed. Right?
2:16:31
I can tell you from the hundreds of robots that we've deployed today, less than 5% of my deployment cost is programming the robot to do the thing.
2:16:39
That's like it's like it's it's it's completely, you know, delusional how many people are spending their time trying to make the robot a little bit easier to program.
2:16:47
Like that's inconsequential to me.
2:16:48
Like I need to focus on solving the other 95% of the of the cost of deploying robots. Uh so I don't know.
2:16:54
Can you talk about uh can you talk about landing on CPG and food and beverage broadly?
2:16:59
You you said you invested in 50 plus different robotics companies.
2:17:03
I'm I'm assuming you saw a bunch of, you know, success and failure and I'm I'm I'm assuming that was super intentional to land here.
2:17:10
Um, and then I want to ask, you know, potentially, you know, other categories that you're excited about.
2:17:16
Yeah, I'll be honest, it wasn't that intentional.
2:17:19
We started out uh going really broad.
2:17:20
We were doing things in in metal fabrication.
2:17:24
We were doing things in plastic injection molding.
2:17:25
We're doing things in CPG and a bunch of other industries.
2:17:27
Um, ultimately, we narrowed back into CPG uh for the for a couple of reasons.
2:17:34
Number one, it's the actual it's the industry where there's the most amount of utilization, right?
2:17:38
So, the typical CPG factory actually runs 20 to 24 hours a day.
2:17:42
Um, in things like metal fabrication, like like parts, factories that make metal parts for aerospace and automotive, they typically run, you know, eight hours a day of of production, but actually only like six hours a day of actual uh parts being made.
2:17:56
There's like two hours a day where people are setting up and tearing down.
2:17:59
Um so so high utilization means automation has a much much bigger short-term impact.
2:18:04
Number two, it's the industry where there's actually a lot more of it happening domestically u in metal and plastic manufacturing and other stuff like a lot of it is still being imported today from from um from China, from Mexico, from Canada, from other places.
2:18:17
Um but because CPG products are generally low value and low margin, it's not worth it to ship them across the ocean.
2:18:23
So a lot of that is actually happening uh domestically.
2:18:25
Um, so there are a lot of factories that can use automation.
2:18:29
And third, those are the jobs that are the most backbreaking, painful jobs, right?
2:18:33
Like a m you can afford to pay a machinist 50 bucks an hour or 60 bucks an hour because that's like a high value, high margin product.
2:18:40
Uh, you can't afford to pay somebody who's packing boxes more than 15 bucks an hour.
2:18:45
Uh, and so and they're still picking up super heavy, you know, cases of drinks and things like that. Exactly. Yeah. It's backbreaking.
2:18:52
Can you take me through kind of a market map or uh like the the the the topography of robotics because I've watched how it's made.
2:19:01
I've seen, you know, a little scooper.
2:19:03
I don't even know if I'd call it a robot.
2:19:06
It's more just like a machine.
2:19:06
Then there's, you know, two axis gantries.
2:19:11
I'm seeing a lot of robotic arms, a lot of six axis stuff.
2:19:13
Uh and then you get into the humanoid world.
2:19:15
into the humanoid world. uh where's the biggest opportunity in terms of or where's where's the most need to deploy and like what type of robot is the most important to just roll out in America right now um yeah I think like articulated sixaxis
2:19:33
robot arms are still the vast majority of use cases right um I think if you look at what humans are doing in these factories like they're typically using their arms not other parts of their body so so I think it's just an indicator of like that that's the most common task. Whether you're talking about uh
2:19:48
Whether you're talking about uh assembly, whether you're talking about uh quality control, you need kind of vision obviously.
2:19:53
Uh whether you're talking about um packaging, whether you're talking about even kind of primary food handling and sorting in the metal fabrication world, you need a lot of machine tending, which is, you know, picking up a blank part and putting it into a CNC machine.
2:20:04
We have a bunch of robots that are doing that.
2:20:06
All of those are just kind of articulated arms uh that can do it.
2:20:10
So, I think there, you know, there are use cases for the humanoid form factor to kind of do new new types of tasks.
2:20:14
new types of tasks. Uh we also have some gantry robots that we've deployed that do certain types of applications where it's like very high payload um uh work but uh you know the to be honest like the form factor is kind of irrelevant
2:20:27
because in all these types of robots that you're talking about you have a couple of motors and some motion control right like it's actually uh if you can abstract away the software enough like all of those things are are essentially different variations on the same on the same problem. I I want to talk about the capex thing.
2:20:41
I I want to talk about the capex thing.
2:20:44
Um, what's the damage uh for a company if they're not working with you to uh buy a bunch of six axis robot arms these days?
2:20:54
Uh, can you give me like an order of magnitude for how much these these robots even cost?
2:20:58
I've seen a couple of Yeah.
2:21:00
Or maybe even some of the history some of the history.
2:21:02
I mean, we've seen so many companies try to automate, you know, bring in robotics, right?
2:21:06
like Nike has a history of of trying to do this in in Latin America and just failing miserably despite having seemingly competent partners.
2:21:15
So, um yeah, I'd love some additional context there. Yeah. Yeah.
2:21:21
So, um uh I'll start I'll start with the second question first and then I'll move to the first question.
2:21:28
So, uh the vast majority of robots in America today are deployed in uh very very big companies.
2:21:35
So, General Motors, Proctor and Gamble are two examples of like the biggest buyers of robots in America.
2:21:39
They buy like a couple hundred robots a year.
2:21:41
Um, and they have very large in-house engineering teams who can use those robots to to to do different kinds of tasks.
2:21:49
Um, the the problem is 99% of factories in America are small mediumsiz businesses.
2:21:56
And the logic follows like if you know if you take a single General Motors plant uh that makes cars uh there's 4,000 small factories that make the components that go to General Motors that get assembled into a car, right?
2:22:09
So there's one guy who makes the windshield and one guy who makes the screws and another guy who makes um uh uh you know the tires, right?
2:22:16
Like every single one of those smaller factories is not automated at all today.
2:22:19
Like 95% of them don't have any robots.
2:22:21
So um the the cost is a part of the question, right?
2:22:26
which is yeah it costs between a couple hundred thousand to a couple million dollar uh to build a fully automated uh robot work cell. Mhm.
2:22:33
The the interesting thing though is if you break down that cost uh about 30% of that cost is the hardware itself, right?
2:22:40
Like the robot arm and and and the conveyor and that kind of stuff.
2:22:44
70% of the cost is all the custom engineering that you typically have to pay for uh for integrators and consultants and this and that to come in and try to customize it to your process.
2:22:55
Um and if you're a small factory like you don't have the capacity to kind of get rid of that 70% custom engineering cost uh because you don't really know uh anything about robotics.
2:23:05
Uh and so the reason that we built all this kind of infrastructure tooling around it is that we're cutting out that 70%.
2:23:11
it costs us significantly less to go and buy and build and deploy those robots uh than it would be for them to try to do it on their own.
2:23:17
Uh can you walk me through uh who the best uh robot builders are in the world right now?
2:23:27
What is the what does the supply chain look like in terms of constructing, building, R&D robots?
2:23:31
Uh who are the major players globally? Who are the upandcomers?
2:23:38
I I I don't even know if I could name a single robot maker.
2:23:42
Um but I'm interested to hear kind of like what the landscape looks like, who the who the major players are. Yeah.
2:23:48
So the the biggest robot companies in the world are all not American, right? So Fanic uh is Japanese.
2:23:52
They're they're one of the biggest ones.
2:23:54
Uh Cuka used to be a German company that got acquired by a Chinese company.
2:23:58
uh ABB, um Yasawa, uh you know, Mitsubishi, you know, there's a bunch of these kind of very very large industrial companies that make robot arms.
2:24:09
Uh the the thing to note though is that like buying a robot arms is effectively kind of useless on its own.
2:24:16
Uh you need a full robot work cell to make that work.
2:24:18
So you need PLC's that often come from like Seammens or Rockwell.
2:24:22
You need sensors that come from companies like K.
2:24:24
Uh a programmable logic controller.
2:24:27
So it's like the it's the thing that controls all the peripherals and safety equipment.
2:24:33
Um yeah and then uh you need like conveyors, you need safety scanners that are often made by like Kian Cognex and a bunch of other company.
2:24:40
You need grippers which is the end of arm tool.
2:24:43
Uh so uh today like the vast majority of people who deploy robots basically hire a consultant that goes and buys all these different components for them and then assembles it and then deploys it for them.
2:24:54
Yeah, I saw this at Hrian.
2:24:55
They have a they have a six-axxis robot arm and they have this like invisible wall that if you put your hand through it'll just light curtain. Yeah, light curtain. That's what it's called.
2:25:05
How uh why has automating 3PLs proven to be such a challenge you know there's been a bunch of you know Amazon had their uh internal efforts.
2:25:14
I think there's like six river systems which it was maybe Shopify acquired them but it it just seemingly is uh such a difficult task and you would think that you know grabbing items and putting labels on them and you know shipping them should be uh it seems straightforward but uh clearly not. Yeah.
2:25:37
I mean I'll I'll I'll note that like we don't know a ton about 3PLs because almost all of our work is in manufacturing.
2:25:44
logistics is a much much smaller industry and like we're not in it today.
2:25:49
Uh I will say right like logistics has to deal with a lot more variability than manufacturing.
2:25:53
Um because if you're if you're running a 3PL like any kind of product could come into your warehouse any time.
2:25:59
Uh and so you need systems that can deal with all of them and there's just there's just like physics based constraints on that, right?
2:26:07
like if you're picking up uh a you know a a 1 oz bag of something versus a 50 50 lb uh box like you just need fundamentally different physical hardware.
2:26:17
Um and that's why I think a lot of this kind of humanoid stuff is is very strange because like if you're picking up a 50 lb box with with one of those robots like it's it's very likely to tip over pretty easily.
2:26:27
Like you need and if you want to move at any kind of speed, right?
2:26:32
Because if you take a 50 lb box and you move it uh at you know 5 miles an hour uh your effective load during that acceleration is like double or triple uh that right so it's like 100 pounds of load that you have to be able to handle which is just kind of impossible.
2:26:46
Um if you move to manufacturing like you have a lot more consistency because every production line is kind of making the same part uh or the same product at relatively higher rate.
2:26:54
Um and so the the technical complexity is lower but the operational complexity is higher. Interesting.
2:26:59
Um on on the note of humanoids, uh are you worried about depreciation with humanoids?
2:27:06
I think this is a concern if if humanoids end up, you know, working well but then following the same path as like EVs because uh there's like high, you know, there's high wear and tear on cars, right?
2:27:19
They're just like going down a road all the time and that's challenging.
2:27:23
And you can imagine humanoids are walking around with these heavy uh loads and then uh simultaneously like all of that interaction just feels like um I worry about the economics of humanoids.
2:27:34
If you buy a rob a robot for 50k and the next year it's worth 10k.
2:27:39
It's like well you almost could have hired a human for that kind of uh cost.
2:27:44
But I'm curious what your point of view is.
2:27:47
Yeah I think it depends on what um what the task is, right?
2:27:52
Like if you're using that humanoid to do an occasional task, right, like pick up your laundry and and put it into the basket for example, like you don't worry so much about wear and tear because it's low frequency.
2:28:00
If you're talking about manufacturing use case, right, like these robots behind me, all of them operate 24 hours a day.
2:28:08
Uh and so at that cycle rate, like you're doing maybe 50,000 cycles a day.
2:28:13
Uh at that rate, like the wear and tear you get on all the components is very very high.
2:28:17
Um and uh like a six- axis robot has six motors.
2:28:21
Uh a humanoid, most of these humanoids that we've seen have something like 30 to 50 motors, right?
2:28:28
And so just you're just talking about like the wear on the motor, like we have to go out and lubricate these joints and and and and replace motors on a pretty regular basis.
2:28:35
Um I can't imagine if I had to do that for 50 motors instead of instead of three, right? Yeah.
2:28:41
Uh, speaking of motors, um, I saw that in the latest, uh, Boston Dynamics demo, they said that they switched to electric motors.
2:28:48
Is that a meaningful shift in robotics or is that something that's unique to their approach to building humanoids? Um, yeah.
2:28:59
So, most of the robots that we use use servo motors.
2:29:02
So, they're all they're all kind of electric motors.
2:29:05
It's pretty it's pretty standard.
2:29:05
Um, some of some of the new humanoids are using uh linear actuators.
2:29:10
uh which is a newer technology and I think the Tesla humanoid is doing that.
2:29:15
Uh it's uh like the exact kind of wear and tear profile on that is not clear and a lot of them are actually building their own uh their own motors from scratch.
2:29:23
own motors from scratch. So um like like the Chinese like I think this is a place where China has a huge advantage compared to like a lot of the American startups uh uh uh like unitry for example which I'm sure you guys have seen those videos like they have uh built an entire team to build uh actuators and a whole team that's
2:29:43
building their own custom LAR and a whole team that's building their own kind of custom sensing across you know for most of these American companies it's kind of inconceivable to go and try to invent your own motor and try to figure out how to build a humanoid Uh, but in China, it's possible to be much more vertically integrated. That's so
2:29:56
That's so odd because you have to imagine back in the dawn of the automotive revolution.
2:30:02
Like Ford was certainly building motors and wheels and tires and seats and the frames and stuff like we did have the ability to have a vertically integrated supply chain at one point in America and then we just decomposed it so much that uh it's been it's been a struggle to get back to vertical integration. Uh very very tricky.
2:30:22
the management consultants got hold of us. They did. They did.
2:30:24
Um uh yeah on on on humanoids.
2:30:27
Um I don't know if you've been following what uh physical intelligence has been doing with some of the endto-end models this idea of generalization.
2:30:39
Um are there any are you looking at any software approaches that are more uh I don't know big data or or uh you know um deep learning driven to handle more of those edge cases to automate uh the the last 90% of the work that you're doing uh and what are you what are you following on the AI side of things these days? Yeah.
2:30:59
Um so I think these vision language action models like what physical intelligence is doing is are are very promising.
2:31:05
M uh we're running trials on some of those vision language action models for some of our use cases.
2:31:12
Um the problem today is that they're just generally too slow uh for us to be able to use them in a kind of commercial setting, but I think that'll get better in the next few years.
2:31:20
Um so there are like you know in the common trajectory for us is like we'll we'll start out in a factory with one or two robots and then the factory will come to us and say hey can you help me like automate all these other tasks on my production line?
2:31:34
uh and today some of those are solved and some of them are not.
2:31:36
Um and so as we go uh you know as as these vision language action models get better and other kinds of uh techniques around you know deep learning get better we'll start to go and address uh more and more of those tasks. Um, yeah. I mean, this is great. Yeah. Yeah. Continue.
2:31:50
I was just going to say, you know, like I I think that the the thing to note here is like we're just at a very different place compared to uh like more established automation economies, right?
2:32:00
Like in China right now, uh last year there were about 400,000 robots uh deployed.
2:32:05
Uh in the entire US, we had about 30,000 uh robots deployed.
2:32:08
less than a tenth uh of of the amount of robots deployed in a place where the labor cost is so much higher that you could theoretically justify a much higher use case of robots.
2:32:18
And I think a big part of the reason is like China just has so many more engineers that they can put towards the problem of design and deployment.
2:32:24
Plus they subsidize a lot of the kind of robotics industry uh to be able to go and make it easy for people to deploy. Yeah.
2:32:31
I think in the US we have this this challenge where uh there's a lot more small and mediumsized businesses and we don't have the historical infrastructure or the engineering capability for all these plants to figure out how to automate on their own.
2:32:44
Uh and so like building the set of tooling and helping them figure out what are the latest things that are happening in kind of AI and machine learning and and computer vision that we can apply to the different use cases in your facility is I think the only way that we can we can move faster than China in the long run.
2:32:57
Is there anything that you want to see from the US government to speed up the deployment of robotics in America?
2:33:05
Trillion dollar trillion dollar contract for I mean yeah I mean you could imagine subsid uh subsidiary sub subsidies or incentives or you know a strategic reserve of robots.
2:33:15
Uh but you could also just look at like deregulation but I don't know what your what your take is. Yeah.
2:33:20
I mean, so I'm excited to go to the Hill and Valley Forum next week and talk about that a little bit, but I like frankly I I don't think there's much that's necessary, right?
2:33:27
Like I think the the incentive is there, right?
2:33:33
There's plenty of financial incentive for these small mediumsiz factories to do it.
2:33:36
To be honest, like the biggest barrier to adoption of robotics in America is like it's a cultural change, right?
2:33:41
Like these factory owners, a lot of these are third generation businesses, right?
2:33:44
They've been passed down or they're kind of private equity owned.
2:33:47
Like in both cases you end up with these businesses that are very riskaverse.
2:33:50
Uh they're afraid to adopt new technology.
2:33:53
They don't have the internal capabilities to do it.
2:33:54
Uh I think from the government side like things that are being done around educating that that group of of manufacturers and helping them to deploy automation is will have a very big impact like similar to what China does actually in the US.
2:34:08
We've had subsidies for small mediumsiz factories for the last 10 years to buy automation equipment. right there.
2:34:14
There's accelerated depreciation.
2:34:16
A lot of states have matching grants where if you buy a $500,000 piece of machinery, the state will gr grant up to up to 50% of that cost.
2:34:26
Um, and so like we've had plenty of these incentives in place, but adoption is super low.
2:34:32
Like when we talk to the states, most of them say like we can't give out these grants. Like nobody's using it.
2:34:38
Uh because people don't know what to buy.
2:34:40
They don't know how to buy it.
2:34:41
uh and once they buy it, they're like they can't handle the responsibility of this new piece of equipment.
2:34:46
Uh and so there's tons of grant dollars just sitting around uh not getting deployed uh because there's this kind of there's this there's this barrier at the last mile. Makes sense. Very informative. Thank you.
2:34:59
We'll uh we'll see you at Hill and Valley.
2:35:02
Yeah, we'll see you next week. Awesome. Look forward to it.
2:35:03
Appreciate you guys having me on. Have a great time. Cheers. Bye.
2:35:06
And we want to tell you about Poly Market. Go to polyarket.
2:35:12
com to get the real news, get the information, uh figure out we got a new market up there.
2:35:18
Uh 1 billion chat GPT users in 2025. That's great.
2:35:21
Uh it is currently at a 64% chance.
2:35:24
Um and feels likely to me.
2:35:30
Uh I the way that they're pacing Yep. is generational.
2:35:37
We have some posts in there. Uh, Callie's here.
2:35:39
I'll let you take the intro. I'll be right back. Welcome in, Callie.
2:35:43
I'm gonna play a sound effect here. Boom. Uh, what's going on?
2:35:48
Looking good in the suit.
2:35:50
You've been wearing those a lot these days.
2:35:51
A lot of a lot of the tech folks have been brushing off the suits these days and coming to DC.
2:36:00
It's been nice to nice to nice to get out of the closet.
2:36:03
How do you stay healthy when you're in DC?
2:36:05
Do you have a good uh do you have a workout routine, a couple favorite restaurants, or you just uh you know, five coffees a day, no breakfast or lunch?
2:36:14
I would love to say I'm on the True Med good energy uh program.
2:36:20
Um but the sleep has been lacking, I will say.
2:36:22
Try try trying to find good food, but not eating much. Just a lot of caffeine. Yeah, I bet.
2:36:26
Um let's jump right into uh this food dye ban.
2:36:32
I'd love to get your highlevel take on it.
2:36:34
Um it uh it seems you know the big question we're a technology and business uh there you go looking good uh we we focus on uh business uh and my big question is how uh manufacturers will respond uh to the ban given that you know uh it's hard enough to even just deliver on the existing demand that they have much less uh you know um uh make you know fundamental changes.
2:37:04
And to be clear, I'm I'm very much in in favor of the ban, but I'm I'm curious what you think this kind of looks like in practice. Yeah.
2:37:14
I mean, I I'll back up a little bit.
2:37:16
I think there's a lot of lessons for business in this environment we're in right now.
2:37:19
But, you know, I never expected to be here.
2:37:21
I'm I'm at the White House now.
2:37:22
I'm a special government employee as well as running True Med with Justin Mayers.
2:37:25
And Justin and I, you know, started the company on the mission of I think a lot of founders do this.
2:37:32
We we just wanted to impact the world and change health incentives.
2:37:34
And just through the advocacy, you know, Justin and I going on podcasts and and and talking about this, something started resonating on this idea that our healthcare and food systems are broken in the past year.
2:37:46
Uh got to know Bobby Kennedy, got to know President Trump, helped connect them for the endorsement.
2:37:52
Um now coming on and and helping to advise the next couple months.
2:37:54
Um but I I think the big lesson of this food diet ban, I I don't even know I really like the word ban.
2:38:01
I like phase out because because banning implies overregulation and I think I think what people are waking up to is there's mass distrust of legacy industry right now.
2:38:09
I mean you know I talk a lot about the food industry was run by the cigarette industry in the 1990s.
2:38:15
Few people remember this but 50% of the US food supply was controlled by Philip Morris and R. J.
2:38:21
Reynolds in the early 1990s.
2:38:23
They consolidated the food industry when smoking rates were going down.
2:38:25
They were actually some of the largest companies in the world in the 80s like highest market caps and some of the biggest balance sheets in history of capitalism tobacco companies.
2:38:35
It's a good business nicotine and um they they consolidated craft US food Nabiscoco and very deliberately bought off the USDA uh to recommend the the food pyramid which is basically a recommendation for ultrarocessed food and they they shifted very strategically thousands of scientists from the tobacco department to the food department and really added all these chemicals in our food to make them hyper addictive.
2:39:00
So through that corporate capture and what I would call the weaponization of food today in America a child's diet is 70% ultrarocessed food in in Japan or Italy it's 15%. Wow.
2:39:10
So so my big argument is that you know we don't really have a free market with these outcomes where of course the disease rates are just skyrocketing.
2:39:19
I mean the stats are crazy.
2:39:21
We're digging into this for a report uh for the administration.
2:39:23
We spend five times more per capita on health care than Spain but live six years less.
2:39:30
I mean, and Spain doesn't even have a good healthare program.
2:39:31
So, so these are common sense actions.
2:39:33
And I think I think there's a really a moment I'm meeting with a lot of food companies, a lot of pharma companies, you know, and they they they're running scared because Americans have lost trust.
2:39:44
I mean, we all know this.
2:39:44
I think it's why there's such a robust, you know, tech ecosystem, building a startup ecosystem, you know, it's because these large companies have really lost trust with the American consumer and the American public.
2:39:56
I I think often for good reason.
2:39:58
So, so I would call this not as much a ban, it's a correcting of corrupt incentives where these food dyes, I mean, just total no-brainer.
2:40:06
They're they're petroleum based.
2:40:06
They're literally crude oil.
2:40:08
They they add a molecule to crude oil, make that bright neon color, uh, and they're phased out of essentially every other country.
2:40:14
So, it's an example of common sense actions that I think are are quite needed.
2:40:18
that that phase out in other countries.
2:40:20
Does that mean that a lot of these manufacturers fully have the ability to sell these products in and make, you know, these products to sell into the US market and they're just choosing not to for the most part?
2:40:32
Oh, it's it's even more shocking than that.
2:40:34
They actually often make the product in the United States.
2:40:38
So, Kelloggs makes Froot Loops uh with carrot juice and watermelon juice and ships them across the border to Canada and ships them over to Europe.
2:40:46
They make the same product with petroleum based dyes here in the US.
2:40:47
So a lot of our food can't actually be exported to Europe based on just just the chemicals in them right now.
2:40:54
So So actually the US are Yeah.
2:40:56
What is the is it a margin thing?
2:41:00
You know, is it is it a is it just economic incentives? Yeah.
2:41:05
Is it purely economics or or is there something else?
2:41:08
Yeah, it's the food diet.
2:41:10
Again, I think this is one of the most no-brainer unimpeachable things they could start with because it's actually not a cost thing.
2:41:15
Uh we've done a lot of engagement with the food industry on this.
2:41:19
Um actually they've done a lot of research and they actually cite this as a reason for why they should keep it.
2:41:25
They say well the kids in focus groups lunge for the neon bright colors and it's like well I'm sure they do but you're feeding them crude oil.
2:41:34
So so it's really actually they say it's consumer preference and actually when pushed before the food industry said well we believe in consumer choice and kids prefer uh these bright colors.
2:41:46
So, that's one reason I think uh the administration and secretary started with the food diet.
2:41:50
My Yeah, my three my three-year-old would love to eat cake for dinner every single night, but that doesn't mean that he should have, you know, the the uh you know, autonomy to just make that decision himself as a three-year-old. Yeah.
2:42:07
How do you think about the history here with like corn subsidies?
2:42:09
Um, is there is there a risk of like playing whack-a-ole as the government decides what uh what to push or what to incentivize?
2:42:20
Um, what do you take away from not just what the food companies have done historically, but what the government has done historically to kind of like steer the food supply in one direction or another? Yeah.
2:42:30
So, so, so I been an entrepreneur for more than 10 years, but I grew up in DC.
2:42:35
Started my career, you know, early on as a lobbyist in the food industry.
2:42:38
And we used to weaponize this nanny state argument um and say, you know, you don't want to be nanny state.
2:42:43
But what what what I really have been trying to communicate, you know, and particularly to frankly a right-ward audience, you know, going on Tucker and Joe Rogan, things like that.
2:42:51
What what I've really been trying to do is articulate that this is not a nanny state regulation issue.
2:42:56
It's a correction of corruption.
2:42:57
Um when you look at agriculture subsidies, more than 90% go to corn, soy, and meat, which are essentially the components of ultrarocessed food.
2:43:07
and the grocery lobbyists and the food lobbyists uh push for that because at a supermarket when you can put something in a box and it lasts forever and it's you know bright neon colors the profit margins are much higher whereas natural food is low.
2:43:18
So there's a huge incentive to shove ultrarocessed food down our throats which has led to agriculture incentives that make a Coke at a supermarket cheaper than water because the Coke has so much subsidized ingredients in it.
2:43:29
So that's not a free market that's totally rigged.
2:43:33
uh 90% to corn, soy wheat, point4% of subsidies go to uh uh fruits and vegetables.
2:43:39
Then you get to something like SNAP, the food stamp program.
2:43:43
Now Elon's looking at this.
2:43:44
This is the fourth largest entitlement program.
2:43:46
It's $140 billion a year.
2:43:46
The number one item on food stamps is soda and more than 60% go to ultrarocessed food.
2:43:53
We're the only country in the world where a low-income nutrition assistance program goes to soda and Twinkies.
2:43:59
Um, so, so you have, you know, go down the list, school lunches, the largest source of calories for kids, federally funded, no nutrition guidelines whatsoever, no sugar, no sugar limits.
2:44:09
So, so you've actually just very deliberately, you know, from the history of the tobacco companies really weaponizing these regulations.
2:44:14
By my calculations, it's been a trillion dollars over the last 10 years of of subsidies to ultrarocessed food.
2:44:21
Um, so we're trying to take stepby-step common sense actions to kind of unwind that.
2:44:30
We're I also quite frankly think there's a cultural awakening happening where people realize the system is pretty screwed and you know hopefully you know we were talking about it more.
2:44:37
We're talking about on a tech podcast.
2:44:38
So the fact that people are trying to be healthier, reading labels more, Justin's talking a lot about this obviously.
2:44:43
I think that's a good thing, too.
2:44:45
And and very unexpectedly, you know, I do think President Trump, Bobby Kennedy, you wouldn't expected this coalition, they're leading to an awakening where 24 states right now are passing legislation on food ingredients, school lunches.
2:44:58
So, I think it's very positive what's happening. Yeah.
2:45:02
I I always thought it was fascinating that uh the food issue is it it it it it's secretly very bipartisan because because you get like the right-wing like trad folks who want to, you know, clean up the food supply, but then you also get like the left-wing hippie who's hanging out at the farmers market and is just like, "Yeah, I grew these vegetables myself.
2:45:21
They're way better than the processed foods." So, yeah. I'm curious.
2:45:24
There should be a coalition there.
2:45:25
Is food and health as political as it seems in the news?
2:45:28
I feel like if you talk to people individually, you know, it's it's like John said, it's bipartisan like we want everybody to be healthier and then you get into Washington and it feels like you you you mentioned you started your career uh in the lobbying space.
2:45:42
Um so I'm curious like where where you think it's, you know, if it's actually a political issue for the average uh citizen or it's just sort of manufactured by special interest groups.
2:45:57
Oh, there's zero reason uh food and poisoning our kids should be political.
2:46:01
And frankly, these things about reforming food stamps, you know, and taking the dyes out of our food were leftward issues, you know, 5 to 10 years ago.
2:46:08
You know, digging into the health issue, I think one of the most pernitious and chronic conditions in America is is Trump derangement syndrome.
2:46:15
And I I think uh TDS has led many people on the left to reflexively uh be opposed to these common sense policies.
2:46:25
You know, probably a lot of the tech folks listening, I know cut politics is complicated.
2:46:28
There's a lot going on, a lot of change happening.
2:46:29
My hope is that we can all come together on these maja policies.
2:46:34
I mean, these are absolute no-brainer.
2:46:36
It's taking on incentives of the pharmaceutical industry, which is something the left used to talk a lot about.
2:46:40
It's taking on the interest of, you know, processed food makers that are really doing some harmful things for kids.
2:46:45
But you've had a wild situation where you've had Democrats now passionately arguing to keep food dyes in the food.
2:46:53
You've had Democrats passionately arguing that we need to continue to have a $10 billion subsidy from the federal government to soda companies on SNAP.
2:47:01
Just reflexively because, you know, the Trump administration happens to be talking about this.
2:47:07
You've had almost no support from Democrats.
2:47:09
I called out Cory Booker, senator from New Jersey, who I've worked with before, I've met, I know he cares about these issues.
2:47:15
Where the hell is Cory Booker?
2:47:16
Why wasn't he at the Health and Human Services Department on Tuesday when Secretary Kennedy was announcing this policy on food dies?
2:47:24
Where is he helping um on these issues?
2:47:27
I mean, this is as bipartisan as it gets. How much you know? Yeah.
2:47:31
How much does uh pharma's, you know, position end up influencing media narratives?
2:47:37
They obviously spend, you know, an exceptional amount uh advertising with different media companies.
2:47:44
This has been, you know, maybe a big issue in in mainstream television where, uh, you know, a television network is not going to, you know, bring somebody on to talk poorly about a company that, you know, is a big sponsor.
2:47:57
Uh, if you wanted to come here and and talk negatively about RAMP, uh, we'd probably change the conversation. I have nothing negative.
2:48:04
I have nothing negative to say about RAM. We love RAM. Fantastic. Of course. Of course.
2:48:10
Um but uh h how you know is that a is that a focal point at all?
2:48:13
Do you think we need some some reform there?
2:48:15
Is it just the sort of free market doing the free market?
2:48:20
Yeah, this this is how this framework I have and you know so privileged to be fighting this fight with Justin and and with Trum and and and trying to help the administration.
2:48:29
But I think what we're doing with the strategy is we're putting a stake in the ground that everyone can agree with where that in 10 years our incentives of our system are changed.
2:48:38
And the way I define those incentives is that nobody wants this.
2:48:40
But the fact is the health care system, you know, a lot of health startups quite frankly still.
2:48:47
The their business model is predicated on more people uh being sick.
2:48:49
Uh the pharmaceutical industry makes more money when people are sicker for longer periods of time.
2:48:55
Hospitals make more money when the meds are full, not when they're empty.
2:48:58
You know, insurance companies actually make more money when people are sicker uh because of this horrible medical loss ratio issue where they actually have an incentive to raise premiums.
2:49:07
So, so, so you actually have every single lever of the health care system predicated on sickness.
2:49:11
Now, that same system, the pharma industry particularly is the lifeblood of news advertising over 50% for most news channels.
2:49:21
So, that creates not a direct, you know, there's not a direct edict going down.
2:49:25
But you have a zero lack of curiosity from the media about why people are getting sick.
2:49:29
It's really just referees about, you know, hey, you need to take this drug.
2:49:33
Ozimpic is the standard of care for kids.
2:49:35
You know, with COVID, I mean, COVID was a metabolic health crisis.
2:49:39
We were 16% of COVID deaths and 4% of the world's population.
2:49:44
And the CDC said at the time it's because our immune systems are so weak.
2:49:47
We're dying very quickly when we get this disease.
2:49:49
Yet, the media was it was just about the COVID vaccine for six-month-olds.
2:49:52
So, um you you do have a very very damaging situation where there's selfcensorship.
2:49:57
And you know what I the strategy is to get to that long-term world where new startups are thinking about how to make people healthy, not how to take advantage of a system and you know deliver direct to consumer oimpic or you know a better UX on medical records.
2:50:14
A better UX on medical records is putting lipstick on a pig.
2:50:18
The problem is the underlying incentives of the system.
2:50:20
Um you know shipping pills in a millennial pink packaging is an innovation.
2:50:24
You know, a lot of healthcare startups are just rappers on the existing broken health incentives that are destroying the country and going to bankrupt us.
2:50:32
So, um, that's the stake we have.
2:50:34
The way we get there is let's do unimpeachable things.
2:50:39
So, this food die thing is one.
2:50:41
Obviously, there's been a lot of talk about pharmaceutical ads.
2:50:42
Uh, Secretary Kennedy and Marty McCary, the amazing new FDA commissioner, have talked about that.
2:50:48
No announcements right now, but that's, you know, something they've said they're clearly looking at.
2:50:50
So, it's it's just getting these things that are 90% support issues, um, bipartisan issues, um, and I think you'll be seeing them, uh, in rapid succession, these announcements. Yeah.
2:51:01
Uh, does does the, uh, media, you know, incredible growth of uh, drugs like Ompic scare you?
2:51:07
Uh, that obviously being overweight is uh, unhealthy.
2:51:14
That's uh you know not not a political um uh point, but uh when I hear people you know saying that they're sort of like losing more muscle than you know fat, that can be uh that that personally um is uh you know can can be concerning.
2:51:31
And then I'm curious um if you have a general, you know, just personal personal opinion only on the sort of balance between like compounding and and getting drugs that are benefiting people out quickly and affordably versus like you know protecting uh the the in intellectual property of of of the companies that you know develop these uh drugs. Great question.
2:51:54
Uh so on the first one I'd say the MA stansipic as best I can define it.
2:51:59
my personal opinion is is there's nothing wrong with GLP1 or ZIPCI per se.
2:52:04
Actually, I think something the administration is talking a lot about is it's not an anti-drug stance.
2:52:07
I think with the dawn of AI and and very exciting things quite frankly in therapeutics, there should be robust innovation and frankly deregulation at the FDA.
2:52:18
The problem is that with the existence of Ozic, it's two problems.
2:52:22
One is that the drug costs 10 times more than it does in Germany or Sweden.
2:52:24
So, and that's that's going to come from US taxpayers.
2:52:29
So, so there's a real corruption in the pricing.
2:52:31
And then number two, corruption in the standard of care, what I call it.
2:52:35
So, there was a Medicare ruling from Biden that said that Ozmpic should be the frontline defense for anyone who's obese or overweight on Medicare.
2:52:43
So, so you know, a 15-minute appointment, you get your Ozmpic and then diet or exercise, right? Right.
2:52:50
No, didn't even mention it.
2:52:50
And there's no funding for diet.
2:52:51
So, we spend five trillion on healthcare, right?
2:52:55
And then they were going to push this through where it was imp over $1,000 a month which would come from taxpayers.
2:53:00
Not with no other option or no other route for an American to get, you know, the blood testing to understand their nutrient deficiencies or talk to a dietary coach.
2:53:09
You know, this is what Truman did.
2:53:10
Why would we put that flag in the ground?
2:53:12
It's like there should be flexibility with um with where healthcare dollars can go.
2:53:16
So the problem, you know, is not that big exists.
2:53:20
It's that that Medicare ruling would have gone to Medicaid.
2:53:22
it would have gone to kids because now it's being essentially pushed on six-y olds through the American Academy of Pediatric.
2:53:27
So, you're getting to a world where, you know, stag rates, metformin rates, anti-depressant rates have exploded among teens.
2:53:35
35% of teens are on some kind of chronic disease drug.
2:53:38
You know, Zipic would just be added to that repertoire.
2:53:40
And of course, that's just not from our medical system incentivizing the root cause.
2:53:45
I mean, maybe somebody that's 75 year old on Medicaid, Medicare, um, who is, you know, 400 pounds and extremely diabetic and set in their ways. Sure. I mean, probably Ozic.
2:53:56
I'd be fine with Medicare funding for that.
2:53:59
But, but for the vast majority of American people, um, that shouldn't be the first line defense.
2:54:05
That that's the problem with our healthare system right now.
2:54:06
there's not flexibility for patients to maybe work with a functional medicine doctor or figure out a more root cause intervention because obviously obesity is not an oyic deficiency quote. Yeah. Yeah. Yeah.
2:54:19
What uh what countries do you look at as models?
2:54:21
The the tech industry loves to poke fun at Europe.
2:54:27
You know, they don't tend to make trillion dollar companies very often uh or or ever in the also don't win a lot of bodybuilding competitions.
2:54:35
We are the most obese country but we also America also wins a lot of bodybuilding competition John's point of view but but what can we you know what are you looking at in terms of like this is a you know functioning uh government in the context of personal health really interesting so I don't like giving
2:54:51
Europe any credit whatsoever uh they don't deserve much and I will just say this is a key point Europe's health care systems are total basketcase systems they're terrible socialist systems so I think one of the things we can learn about Just just to be clear, the stuff Yeah. The stuff they get right is like
2:55:06
The stuff they get right is like saying like, "Hey, we don't want this die.
2:55:10
We don't want glyphosates."
2:55:10
You know, they get a little actually what they get right is that the healthare system is less important, is that people are healthier to begin with.
2:55:17
The problem with the US healthare system is not that we have the wrong Medicare, Medicaid reimbursement rates.
2:55:23
It's the fact that we're the sickest country in the world.
2:55:26
And that's actually because we rely too much on the healthare system.
2:55:28
So, what I like about some other countries in Japan, and I think we need more of this, and Bobby Kennedy is pushing this more.
2:55:35
I mean, if your kid is obese, you are shamed as a parent.
2:55:38
Like, it is totally society unacceptable. Like, you are shunned.
2:55:42
Like, you're like yelled at by the school.
2:55:44
Like, I think we need that same type of energy in America.
2:55:46
Like, children should not be fat and diabetic. Like, period.
2:55:49
Like, like we have totally lost our way right now.
2:55:51
There's a whole Tik Tok craze where they're shaming doctors for weighing patients or even talking about weight.
2:55:57
O obesity is a blaring warning sign that our cells aren't working.
2:56:01
And it is not I do not blame the individuals.
2:56:04
When 80% of American adults are overweight or obese, we have a systemic problem.
2:56:07
But from the culture, we shouldn't accept that.
2:56:09
We should absolutely be declaring that we do not want to have childhood obesity or diabetes and have that culture.
2:56:19
Additionally, in Japan and Italy and some of the European countries, there is like total bipartisan just consensus, this sounds so obvious, but but it's not the case in the US, that we shouldn't be poisoning kids.
2:56:29
I mean, this school lunches in America are an absolute dumpster fire.
2:56:33
And you know, in in in Japan and Italy and France has mandated at daycare a four course meal, including a cheese course, I think, a cigarette and wine afterwards.
2:56:44
I mean um but that'd be healthier than what they serve in America.
2:56:49
I mean it's absolute disaster.
2:56:51
So there is just this cultural thing around food.
2:56:54
One thing I look at Europe, they spend three times less on average per capita on healthcare but two times more per capita on food.
2:57:00
Uh in Europe they they do have a lot more respect for their agriculture system and their farmers and the consumption of whole food there is much lower the you know thoughts about pesticides and what's going on the food.
2:57:13
So, so you always hear you go to Italy, the posi, the gelato, you lose weight.
2:57:17
I mean, that's really true.
2:57:19
that's really true. So, I think what needs to happen and and what I hope culturally happens with these step-by-step wins is we move culturally to a system that puts less emphasis on getting sick and then getting drugged
2:57:32
and more emphasis on what I really think is a spiritual issue of having more curiosity and awe about what we're putting in our body, our environment, how that impacts the soil, how that impacts the food, and then just getting back to basics on, you know, not poisoning kids. Is there anything that
2:57:45
Is there anything that the government can do or even America could do about on the fitness side of things? Yeah.
2:57:52
What happened to the presidential fitness test?
2:57:53
It got kind of phased out.
2:57:54
There was a new program in 2013 of the battle here.
2:57:56
We're we're addressing a lot of the diet and the food supply stuff, but fitness is extremely important, but it's harder to incentivize or subsidize. May maybe I don't know.
2:58:07
What What is your take on fitness?
2:58:08
Well, I was just with Secretary Kennedy in Miami at a UFC fight and you know, Shaq was there and a bunch of A-list celebrities talking about how they can help, you know, encourage youth fitness and rejuvenate.
2:58:18
So I don't want to get in front of any announcements here, but I think that type of education and inspiration among kids uh for more fitness to not be I mean a a boy in America, you know, a teenager boy in America has less testosterone than a 68-y old man.
2:58:37
Like like like there's been a depletion of testosterone among kids.
2:58:42
Uh obviously because of our food or sedentary lifestyle, we're soft.
2:58:44
I mean, you know, 77% of of of you military- aed youth cannot uh join the military in America right now.
2:58:53
It's a national security crisis.
2:58:54
So, my one two kind of framework in my head is let's get the wins like the food dies.
2:59:00
But I you can't underount the cultural education elements to this.
2:59:05
You know, bringing what Justin Mayers and and Mark Heyman and a lot of people have been talking about this for a long time.
2:59:13
Bringing that to the forefront, these common sense solutions.
2:59:14
So, you're going to see a lot of initiatives.
2:59:16
And one thing I'm excited about is when Secretary Kennedy was uh sworn in by President Trump, he signed an executive order.
2:59:24
And on May 22nd, in about a month, they're releasing a 100 day report on the chronic disease crisis, why kids are getting so sick.
2:59:30
Uh it's going to say things that the US government's never said before, uh about environmental toxins, about our water quality, about our food quality, about our sedentary lifestyle.
2:59:39
So, so getting the facts down and having the conversation on a factual basis and not letting industry and I'll say this, a lot of people in industry lobby not on policies but actually to prevent transparency about what's happening.
2:59:53
You know, there's pressure, you know, to not talk about pesticides.
2:59:57
There's pressure to, you know, not talk about certain topics because it's going to scare consumers or it's going to confuse consumers.
3:00:03
Um there is a good trend right now where the government is going to talk about anything they want to and they're going to give Americans uh uh information not infantilize the American people as we often do.
3:00:14
Um, and I think that's the necessary precondition for a long-term conversation about policy change to systems that are going to uh bankrupt the country and and cause us to cease to exist which is I think is true given the trajectory of our healthcare budget which which will bankrupt us and the decimation to American competitiveness when you have 50% of teens overweight or obese and 38% of teens pre-diabetic.
3:00:40
those kind of uh numbers are so shocking living in California or any you know if if you live in California and New York it's just you would never believe those numbers you have to go to to places that don't where wellness is not you know the the number one trend I'm curious do you think uh this movement around making
3:01:00
America healthy would have been possible before decentralized media feels like we kind of needed podcasts we needed social media uh we needed people We needed like a mom some random place to discover that when she removed red dye from her kids food that this thing happened and then she shared it and people start collaborating. So I feel like uh you
3:01:19
So I feel like uh you know a lot of this movement just would have been impossible when you only could get your news from magazines or newspapers or radios that are all captured in some way by you know uh large corporates.
3:01:33
No, the uh independent media ecosystem is an absolutely necessary condition to the opportunity we have right now.
3:01:38
Um it can't be overstated how destructive it is that our core information source has been co-opted by an industry that profits from Americans being sick and that's had devastating consequences.
3:01:48
I think what's happened with independent media is one of the major historical events in American history.
3:01:54
Like when you read about the American Revolution, it was really propagated by the ability to easily print pamphlets and Ben Franklin and others, you know, getting ideas out that have never been able to get out before in a in a mass way.
3:02:04
I think this is a huge shift.
3:02:07
I mean, for, you know, since World War II, we've had a corporateowned essentially media and now we're able, you know, you guys and people at a microphone are able to get more distribution than CNN.
3:02:16
Um, the, you know, Secretary Kennedy, you know, was called a whack job by everyone.
3:02:21
actually him and President Trump are the two most popular political figures in America still uh he he was able to get through on independent media podcasts like Joe Rogan um and actually Americans you know determined a lot of them that he actually makes a lot of sense with what he's talking about really about these overarching incentives of healthcare.
3:02:41
I can't stress that enough.
3:02:42
can't stress that enough. There's a there's a in in this building in in the White House there's a there's a shift happening where we are of course talking about health care policy like what to do on Medicare and Medicaid but but it's more about the foundational incentives where what is the logic of where the $2 trillion we spend on
3:03:00
Medicare and Medicaid going is that straight to drugs or is it more root cause interventions how are we incentivizing our food system are we really incentivizing ultimate processed food for kids is there enough transparency for Americans to make the best decisions there's more foundational topics being asked and those are very disruptive topics to the you know legacy industry. Um and uh and that's all
3:03:18
Um and uh and that's all because of independent media.
3:03:21
because of independent media. I'll say the independent media also rightfully has led to record distrust of our major institutions from you know frankly the education system you know a lot's happening with Harvard right now um to uh the pharmaceutical industry you know to to to others that's warranted and and and one of the leverages I think um
3:03:43
there is for change is that these industries when I meet with them you know really acknowledge that they have to make some major changes really partner frankly with Secretary Kennedy you know not to do any secretary Kennedy or President Trump any favors because they actually have to make changes to maintain their legitimacy with the American people. I mean, it's not
3:03:58
I mean, it's not working right now.
3:03:59
I mean, some of the tech bros on Twitter are saying how incredible, you know, um recent American healthcare innovation, uh how it's how it's been.
3:04:08
I I'd love to see what they're talking about.
3:04:10
I mean, we're literally have life expect declining.
3:04:14
You know, we spend four to five times more than other countries.
3:04:16
chronic disease rates, every single one is at a record high this year in America with the highest rate of chronic disease than any country in human civilization.
3:04:23
I I don't know what they're looking at, but we're not in a good situation right now.
3:04:29
How do you uh think about timelines?
3:04:33
You're, you know, special government employee for a limited period of time.
3:04:38
This is obviously a monumental task.
3:04:40
It's not something that can be solved even in a single admin.
3:04:42
How how do you think about you know making sure that obviously you know we were headed in a to to a really bad place uh from a from a you know nationwide health standpoint from an economic standpoint due the due to the consequences of those health issues.
3:04:58
But um what what's the what's the strategy to make sure that this sort of movement becomes bipartisan and kind of can live uh live on after you guys are are no longer in the White House?
3:05:08
I personally think we need to think about as a 12-year strategy.
3:05:12
We're not going to reorient the incentives of the largest industry in America, the the fastest growing industry in America because we're getting sick, the most employed industry in America.
3:05:21
We're not going to change those incentives uh overnight or even in the next four years.
3:05:26
I think what we need to do, what I'm focused on is is maintain the political coalition of what you call this MA coalition.
3:05:33
The reason we're able to drive change is because millions of women, quite frankly, moms voted for Trump for the first time.
3:05:40
people who would have never considered voting for Trump years ago.
3:05:43
This issue has galvanized voters into a coalition.
3:05:46
Uh President Trump uh was 5050 among young people, 50/50 among independents.
3:05:51
We couldn't have imagined that four years ago.
3:05:54
So m multiple factors for that, but clearly this maja kind of energy led to that.
3:05:59
So the reason we have an opportunity for change is because voters have really galvanized around this issue.
3:06:05
So to me, if we can solidify that coalition, that coalition is going to continue to drive change.
3:06:09
We need to deliver wins for the next two years.
3:06:11
I mean, I'd love for Democrats to compete for those voters.
3:06:15
They've had their head in the sand.
3:06:16
If if those voters can help Republicans, which is my hope in the midterms, I think you have 2028 where both sides are basically arguing who's more maja, which I think is a positive thing.
3:06:27
I think we've shifted the paradigm of health.
3:06:28
You know, before last year, healthc care was about how to add more people to the existing broken system. That's insane.
3:06:35
You had Bernie Sanders and Elizabeth Warren just a couple months ago during the confirmation hearings with Bobby Kennedy eviscerating him for taking on pharma companies.
3:06:45
Elizabeth Warren actually said, you know, you're going to hurt their profit margins.
3:06:47
These poor companies like like people have lost their minds when it comes to health care.
3:06:52
Somehow arguing that more resources, more spending to this broken system is how we solve it instead of actual full reform of the system.
3:06:58
I want to get political victories and change the overall bipartisan way we talk about health.
3:07:05
And I will say, everyone talks about the special interest, the money.
3:07:09
The one thing that counteracts that is voters really voting on this issue.
3:07:10
And now you have maja moms and people waking up caring about this issue as a voting topic.
3:07:17
So as long as that solidified, you'll have momentum that changes the incentives of healthcare where we can look back in 12 years and we have a thriving pharmaceutical industry, but they are incentivized to promote longevity.
3:07:30
They're incentivized to cure diseases, not just manage them.
3:07:32
All farmers profits right now are managing um and you know we we have an overall healthcare ecosystem that's more value based that's more that's more geared towards keeping people healthy which can happen. Yeah. Yeah.
3:07:44
There does feel like a way to flip the incentive where the pharmaceutical companies are like if we can just keep this person alive for another hundred years imagine how much you know how many drugs we can sell them.
3:07:55
They should make a lot of money for that.
3:07:57
Like like like imagine the impact the economy I if they could do that like they should make a ton of money for that.
3:08:02
and they tell you off the record, right?
3:08:04
They'd love to do that, but the incentives are all about disease management.
3:08:07
So, so, so this isn't a free market right now, and there's a real opportunity to nudge these incentives to a different direction. Yeah, that makes sense.
3:08:13
Well, thank you for the work that you're doing.
3:08:17
Yeah, and making the time. Uh, thanks, guys.
3:08:20
I think you're doing very important work.
3:08:22
Yeah, we'll talk to you soon. Thanks. Talk soon, guys. Bye. Bye.
3:08:26
Uh, let's tell you about Public.
3:08:26
You heard the founders on the show earlier, but public is investing for those who take it seriously.
3:08:33
They got multi-asset investing, industryleading yields, and they're trusted by millions.
3:08:36
Uh we got some personnel news today.
3:08:38
Uh Jason Citroen is out as CEO of Discord.
3:08:42
He's bringing on Humam Sakani Sakanini.
3:08:48
Building Discord has been one of the most meaningful and rewarding experiences of his life.
3:08:53
What started as a simple idea to help friends talk while playing games has grown into something far bigger than I ever imagined.
3:08:59
I'll be transitioning to a new member as board member and adviser and continuing to support Discord through this next chapter.
3:09:06
I'm incredibly proud of what we've built together and even more excited for what's ahead.
3:09:09
Uh very interesting will be interesting to see Discord uh gets out at some point.
3:09:16
There's been rumors about IPO uh and so yeah, maybe maybe that's the uh uh maybe this is a move to prepare for the public markets.
3:09:24
Being a public market CEO is a different job and maybe Jason wants to step back, but we'd love to have him on the show.
3:09:30
Do a little gaming day, talk about everything in Discord's world.
3:09:34
Fascinating founder, total outlier.
3:09:34
Uh not from the typical Silicon Valley elite pipelines, not Stanford or Harvard.
3:09:43
um uh and built uh you know one mobile game at some point uh sold one company, ran it back, built up Discord into a really really powerful company.
3:09:55
So uh congrats to him on the transition and good luck to the new CEO of Discord.
3:10:01
Uh we got some uh listener feedback.
3:10:01
We got some posts about the show.
3:10:04
Midwest Tech Bro says, "After listen after switching to TBPN, I got my entire life back.
3:10:11
No more deciding what podcast to listen to, trying to write down important points or worrying that I missed some key news today.
3:10:16
TBPN changed the way I consume media and in turn changed my family's life. Thank you, TBPN. Thank you. Thank you, Midwest Tech.
3:10:24
He says, "From my wife, the Palace of Pump has rocked our world." Yes, we're we're good.
3:10:30
We're happy to have you as a listener.
3:10:32
Uh there's more TVPN news.
3:10:34
Austin Peter Smith says, "Uh, people will say it isn't scalable to bring on each new podcast listener via direct sales reps, but here's a counterfactual.
3:10:43
I got cold emailed by a TBPN rep, ended up doing six calls with them over eight weeks before deciding to become a listener, and then I went on to spend $11 million on eight sleep mattresses with my tri ramp card, providing enough measurable ROI to cover that sales rep for the quarter." Thank you, Austin. Uh, oh, so good.
3:11:02
Pavan goon based Alexandor says you should get a notification if your tweet was featured on TVPN.
3:11:06
Well, this is your notification.
3:11:09
We you have been featured on TVPN. You're featured on TVPN.
3:11:19
We'll be sure to quote this.
3:11:19
Uh we do want to build an automation something around this.
3:11:23
Maybe reply to this post with this clip. Uh we'll figure it out.
3:11:27
We're hiring folks every day.
3:11:27
Just if you apply, make sure you have at least one of the following.
3:11:32
IMO, gold medal, we want uh Navy Seals, GP at a tier one VC, these types of things.
3:11:39
10 years CUDA experience, 20 years high frequency trading experience.
3:11:43
If you have something like that, you might be a fit for the team and still an opportunity to get in under a hundred people. Exactly.
3:11:49
Being in the first hundred is at least you join the next organization. Yeah, exactly.
3:11:53
Uh uh Janon account says would be insane if there were one company with John Schman, Daria, Alec Redford, Ilia, Samma, Greg, Andre Carbathy, Meera, and Paul Cristiano.
3:12:06
Um very very funny, but and the only person left at this company after six months is Sam.
3:12:11
No, I think Greg's still there. Uh yeah, Greg came back.
3:12:15
Um but it is it is crazy how there's been this, you know, there was insane concentration of talent there.
3:12:19
Uh and then as they as they transitioned out of a becoming a research institute into becoming a product company uh there was a turnover in in the team um and people scattered to the wind to do all sorts of different projects but um you know I'm excited more competition better products for consumer specifically in AI.
3:12:39
Uh Ryan Peterson shares the Wall Street Journal talking about Flexport.
3:12:44
It's a staggeringly tedious job that would be of little interest to anyone in normal times. Absolutely.
3:12:48
They called they called us tariff pencil pushers. So rude. Founder mode. He is in founder mode.
3:12:57
He's getting he's getting uh quoted in the Wall Street Journal whenever something happens in uh logistics shipping.
3:13:04
Uh he's the person that everyone many people many people love to say that Ryan actually created global trade.
3:13:10
He did and so he gets quoted shipping. Yeah. Yeah.
3:13:13
He invented you know the ship basically verticalized the ship. Yes. The ship.
3:13:18
Uh this post from Tyler Cosgrove uh just fantastic design close friend of the show he adds softbank treatment to open AAI's charge.
3:13:30
I agree it looks much better with the the unicorns galloping upwards.
3:13:31
And so the winter projection for uh winter 2025 projection for um chat uh for OpenAI revenue is going from 1 billion in 2023 to 4 billion in 2024 to 13 billion in 2025 to 29 billion then 54 billion then 86 billion then 125 billion. We're going higher. It's fantastic.
3:13:57
Uh, I mean, they're they're on their way and you know, yeah, you throw the you throw the unicorns on there, you throw the big PowerPoint arrow and it looks a lot better, but I mean the business is ripping.
3:14:09
I use the product every day. I think most people do.
3:14:10
Uh, and so good luck to them on their path to $125 billion in revenue in 2029.
3:14:15
Hopefully, I think that they might blow that out. Who knows?
3:14:21
We'll be tracking it here.
3:14:21
We'll be breaking it down.
3:14:23
will be tracking poly markets to see where their DAUs end up or their MAUs.
3:14:27
Uh Sean Frank coming on the show tomorrow but had a um had a good post we wanted to highlight.
3:14:34
He said uh or a bigger third thing, trend lines don't continue forever.
3:14:38
Hard work built this business.
3:14:40
Co scaled it for 24 months.
3:14:42
Every single person in America suddenly loved the outdoors.
3:14:43
They went out and bought gear to enjoy them.
3:14:45
This is the story of uh solo brands.
3:14:47
NASDAQ uh NYC has uh suspended solo brands.
3:14:51
Are they a casualty of tariffs or mismanagement?
3:14:56
Sean Frank's breaking it down.
3:14:58
He says that gear had negative network effect.
3:14:59
Every solo sto every solo stove stove sold increases the CAC of the next one because the next buyer is less incremental, less interested, more taking more promos or ad impressions to buy.
3:15:10
And instead of launching a second bigger skew, they bought nonadjacent brands.
3:15:14
Chubbies is great, but Solo Stove buyers aren't guaranteed to be Chubbies customers and vice versa.
3:15:20
There's no flywheel, no cross-ell, no advantage.
3:15:21
Just a hard good company and a hard goods company and an apparel brand trying to be managed by the same team.
3:15:26
Yeah, I think that ultimately solo the idea of consumer holding companies is very appealing, but consumer products are a full contact sport. Yep.
3:15:36
And the best companies that I'm aware of have, you know, management teams that are 110% in and uh trying to then if you're not and you're trying to manage multiple brands while you're competing in the same categories with, you know, founder le or just exceptional management teams. So yeah.
3:15:55
Well, happy birthday to YouTube.
3:15:58
YouTube turned 20 uh yesterday and Colin Samir remade the very first YouTube video ever.
3:16:05
uh there at the zoo and I hadn't really watched the original YouTube video.
3:16:12
I mean, I probably watched it at some point.
3:16:14
This is the first video ever uploaded to YouTube.
3:16:16
Us at the zoo, Colin Samir recreated it and uh it's 20 21 seconds and it's uh kind of a funny watch if we can pull it up. Um let's see.
3:16:27
Um in other news, uh Arowan raised a $2 billion valuation. Let's go. I Is this a down here.
3:16:35
I mean, we we spend What happened?
3:16:37
I feel like if they have just like a few customers like you, they should be up at like 20, 40, 100, 200 billion.
3:16:43
Yeah, the fact that I get to track my LTV in the app is wild. Wild.
3:16:49
Um Yeah, somebody was breaking down the math here.
3:16:53
I don't know uh how accurate this is. They have 10 stores.
3:16:59
Um you know, I I I don't know.
3:16:59
I've heard a bunch of rumors uh just being around LA over the years uh of just how much money they make, but um it's you have to think of it as a grocery store, a high margin grocery store, which is non-traditional groceries, typically low margin.
3:17:17
They've turned grocery into a high margin uh business, plus adding on a high margin restaurant.
3:17:22
Uh plus they sell uh you know, home products and beauty products and skincare and things like that.
3:17:29
So, you can't look at it as a purely monolithic um you know, it's not a uh it's not a typical grocery store.
3:17:37
And then they also have this like cafe business.
3:17:38
And I think when you combine all of those um they're just cash machines.
3:17:43
Andrea here says uh she's been told by multiple sources that they claim to make $50 million per store.
3:17:49
So 10 stores, that's $500 million in revenue.
3:17:51
And they also make more money from the smoothie collabs, which is very fun.
3:17:55
One of our goals for this year is to get a TBPN smoothie at Arowan.
3:17:59
So if you're listening on it, give us a ring.
3:18:00
Um let's watch the Colins YouTube video.
3:18:03
So here we are in front of the uh elephants.
3:18:13
Cool thing about these guys is that they have really really really long trunks. And that's that's cool.
3:18:27
And that's pretty much all there is to say. All right.
3:18:29
So, can you believe that?
3:18:30
That That was the first Let's go.
3:18:34
That was the first YouTube video. A masterpiece. A masterpiece. A masterpiece. Yeah. Chad Hurley. Uh the YouTube team. They threw that up.
3:18:43
And YouTube was originally We got to We got to pull up one of those videos sometime.
3:18:46
not today, but of the early YouTube team when they're just like, you know, talking like they look like they're in like a like a like um a dungeon basically like they're just talking about how hard it is, how how things are working, how they're not working. But, uh they cooked. They did.
3:19:02
Uh let's close out with a post from Sean Frank who's coming on the show tomorrow.
3:19:06
He says he's opening a speak easy just for red dye 40 and microlastics.
3:19:11
Uh don't let Cali means find out about that, Sean.
3:19:14
Uh, but I like the way you're thinking.
3:19:19
Government can't hold you back. Poison resist.
3:19:21
You're just going to get stronger.
3:19:22
It can only make you stronger, Sean.
3:19:24
I think you're in good shape.
3:19:24
I think you can handle all of the microplastics and the red dyes.
3:19:27
Good luck to you, though.
3:19:29
And we'll ask you more about it tomorrow when we see you on the show.
3:19:32
But anyway, thank you for watching everyone. Thank you, folks.
3:19:34
We will see you tomorrow.
3:19:36
Have a great rest of your