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[Music] Morning [Music] chat. Good morning chat. Good morning chat. Good morning chat. Good morning chat. >> You're watching TVPN.
4:58
Today is Wednesday, October 22nd, 2025.
5:01
We are live from the TVPN Ultradome, the temple of technology, >> the fortress of finance, >> the capital of capital.
5:08
Uh we wanted to revisit a story from a couple days ago.
5:14
Last Friday we talked about on the show uh F1 has officially partnered with Apple TV.
5:18
You probably heard this, but I wanted to go a layer deeper into the strategy that Apple is employing here, the nature of the partnership, some of the specs competit.
5:31
So, it's a 5-year partnership just the United States. ESPN is out. Apple is in.
5:39
And so you won't need an Apple TV to watch F1 though because you can use the Apple TV app on your MacBook as long as you're signed up with the Apple TV service.
5:52
But in general, this will be for Apple TV customers who probably have a physical Apple TV as well as the Apple TV app as well as the Apple TV service because they're all called Apple TV now.
6:02
Uh, and so, uh, the reporting places the annual fee at 140 to $160 million per year just for the United States audience now, >> which is not bad because not long ago they wanted 200 and ESPN laughed them out of they >> bocked. Bocking is underrated. It is.
6:20
>> You got to be bo Max sometimes. >> You do.
6:22
Uh, and so F1 across the whole season, uh, all the races combined, they pull 30 million viewers. uh they get about 1.
6:32
1 million viewers per race.
6:32
Last year, I think it's up to 1. 3 million this year.
6:36
Uh and then some of the bigger races in the US like Miami Grand Prix, that gets up to like 3 million for like this whole spectacle.
6:43
But in general, it's a relatively small media property.
6:47
Um but it's a really high value audience.
6:49
It's a very high uh it's a very Apple audience in my opinion.
6:53
Like I think it actually fits really well with with with Apple's customer base.
6:56
And so comping it, you know, if you think about it, like every race weekend, there's a million people that want to watch F1.
7:03
>> Apple's audience of people that become fans of a sport because they watch reality television about it.
7:09
>> Basically, >> fake fans. >> Yeah, I think so.
7:11
No, I think that I think that's actually accurate.
7:13
I think that's 100% correct.
7:15
Uh, and so you have 100 mill you have 1 million people that are basically loosely tuning in.
7:20
Maybe there's like singledigit millions that are in the overall pool.
7:24
Not everyone watches every race.
7:26
Overall, you get 30 million views, but a lot of those are repeat viewers, people that watch all the races.
7:31
Um, and so Apple has around 40 to 45 million subscribers total.
7:34
And so, you'd think that there's a pretty good overlap.
7:38
Some people will be F1 fans and then they will come over and subscribe to Apple TV because they were on ESPN or they were on the the primary F1 app.
7:47
Now, you will actually be able to uh buy Apple TV and unsubscribe from the F1 app because you will get F1 for free.
7:56
And if you open up the F1 app on your Apple TV, instead of opening the Apple TV app, uh you open the F1 app, you'll be able to log in with Apple TV, the service, and you will get full access to the F1 uh streams, which means not just the race cams uh and the actual production, but you can watch the individual racers, the individual drivers, I think both the front and the back camera, which is kind of cool. You can watch either.
8:22
And so you can say I want to watch Max Versstappen drive the whole time and you can just for 90 minutes uh you know two hours you can just sit there and just watch from that perspective.
8:30
>> Can you imagine having the back view on Max Versstappen for two hours straight?
8:34
You ever you remember being a kid when Volvos used to have those like back seats in the back? >> Yeah. Yeah. Yeah.
8:39
Looking backwards sit back there. >> It's great.
8:41
I mean we should we should be watching F1 at the Ultradome.
8:43
Uh because the the beauty is that with uh all the screens, you can see uh the the production team has what seven, eight screens.
8:52
Uh you can put uh an individual driver on a specific screen.
8:55
And so the real hardcore F1 fans will have the main the main show on the big screen and then they'll have side screens with I want to know what Max is doing.
9:03
I want to know >> you can properly monitor the whole situation now. >> Yeah, you can. You can.
9:07
It it is it is a a sport built for monitoring the situation much like ramp is built for saving you time and money easy use corporate cards bill pay accounting and a whole lot more all in one place.
9:16
Um so the I have two questions and I want your take on these.
9:23
First, is the Apple TV audience big enough to grow F1 immediately?
9:30
If we look at 2026, 2027, 2028, do you think F1 goes up from 1. 3 straight to 1. 4 or straight to 1. 5?
9:39
Do you think this is something that grows F1? >> No.
9:48
>> Do you think it shrinks it?
9:51
Obviously, if you were ESPN subscriber, you could just throw the game on or throw the race on.
9:56
>> I still I still think, and maybe this is the wrong way, I still think of Apple TV as the thing that >> uh people are doing intentional watching on versus just running it, right?
10:04
So, the reason that ESPN potentially grew F1's audience was because people just wake up on the weekend, they turn on ESPN, and it's just on the TV.
10:14
>> Oh, what's on before football or what's on before baseball?
10:16
Like, I'm just going to have it on. Oh, there's a race. Cool. Oh, yeah. Yeah.
10:19
I know these guys a little bit. I I I buy that.
10:21
>> So, I think it could potentially shrink the audience in the US. >> M interesting.
10:25
>> But obviously, it adds value to Apple TV.
10:27
I think we've seen >> uh um it's very clear that live sports are an area that >> traditional >> TV and streaming will continue to have an edge because streaming rights exist.
10:41
It's effectively a >> a monopoly that gets granted to to a platform. >> Yeah. Seems really powerful.
10:46
Um it makes sense for them to do that.
10:47
But I think it makes sense for uh I don't think I'm a Paramount Plus subscriber right now.
10:51
I will be next year when they start streaming all the UFC parts >> through there.
10:58
So I think it's a it's it's amazing as part of a bundle, but I don't think it grows a sport.
11:04
>> Well, if you have a sport that you're trying to grow, you got to get on reream one live stream 30 plus destinations, multiream, reach your audience wherever they are.
11:11
Okay, my second question.
11:11
Is there a real lift from having adjacent sports related content that can funnel new viewers into live sport viewing?
11:18
So, this was certainly my experience. I'm the fake fan. I'm the fake F1 fan.
11:23
I actually watched Drive to Survive, the Netflix reality show about F1.
11:27
I started watching that after and after a few seasons of behind the scenes content edited for maximum dramatic effect, I started throwing on the actual races.
11:36
I knew all the teams, the drivers, the principles, the rivalries, and it basically bootstrapped me in into being able to keep pace with a real fan who's been following for years, at least loosely, even if I do wear the fake fan badge proudly.
11:50
But the question is, how many people are like me?
11:53
How many people are still in that journey? And what does that mean?
11:56
What does it mean for it to happen inside the platform versus outside the platform?
12:01
>> So my question is Apple has doesn't have drive to survive.
12:04
So there is a world where Netflix bought the F1 rights and as soon as you finish the Drive to Survive season if because everyone's watching Drive to Survive all the time.
12:14
So they could just say, "Hey, click this button and we'll send you a push notification in your Netflix app when the ra when the real race goes live or hey, you're watching Drive to Survive, but this this you're actually watching Drive to Survive while a real race is happening.
12:27
Why don't just flip over to that next?"
12:28
There's a bunch of things that Netflix could have done with that pipeline.
12:31
Apple can do something similar with the F1 movie.
12:33
If you watch the movie, we could just say, "Hey, you know, want to watch the real >> way way way less watch time." >> Way less watch.
12:39
Way less watch time movie because it's two and a half hour movie as opposed to what uh Drive to Survive is like 10 hours a season or something and there's six seasons.
12:47
So, it's like 60 hours of content.
12:49
So, you're looking at 30 times as much content.
12:52
Just so many more opportunities to get in.
12:54
And also F1, I do think the movie did a good job. You saw it, right? >> Yeah.
12:59
>> So, I I think it did a good job.
12:59
If you know nothing about F1, they do a good job through the uh the the voice over and the announcer to kind of tell you, okay, there's going to be 20 there's going to be 20 cars on the grid.
13:09
As soon as it turns green, they're all going to race.
13:13
And it's like there's this many laps.
13:14
Like, they have to change their tires.
13:16
Like, it kind of gets you up to speed.
13:18
>> Director Survive does a better job actually talking about race strategy, what it means to be on soft tires versus hard tires, what it means to use Privy, wallet infrastructure for every bank.
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Privy makes it easy to build on crypto rail securely spin up white label wallets sign transactions and integrate operating infrastructure.
13:31
But uh the question is is there is there a value to actually having you move through that pipeline on one app like in one media ecosystem because Apple's actually executing this in uh in soccer.
13:47
So, they have Ted Lasso, which they basically got lucky with, I think.
13:53
Uh, no one really thought that was going to be a massive breakout success.
13:56
It wound up winning tons of Emmys, became really popular, and I don't know that it it's really the type of show that you watch and you're like, "Oh, now I'm a diehard soccer fan, but it's at least a little bit of a teaser."
14:07
And then they actually went to the production team behind Drive to Survive and said, "Hey, make one for MLS." And they did.
14:12
And then Apple also has the MLS rights.
14:15
So, in theory, they have the whole flow there to get you >> from that.
14:19
I've never heard of that.
14:20
Yeah, it's called Onside.
14:20
Um, and uh I don't know uh my my pitch for for Apple.
14:27
>> It is it is interesting that uh it doesn't they have the golf version of Drive to Survive which >> on Netflix and tennis >> um and tennis swing none really >> got the people going.
14:41
>> Why do you think that is? I have a take.
14:43
While you're thinking, let me tell you about cognition, the makers of Devon, the AI software engineer.
14:46
crush your backlog with your personal AI engineering team.
14:51
>> I think the international element of F1, >> yes, >> the high society element of F1, >> seeing the Monaco B-roll on Drive to Survive, you're like, I'm in Monaco. It feels amazing.
15:03
It's so >> harder to do with golf. >> It felt like a Yeah.
15:06
like some combination of like a travel documentary behind the scenes.
15:10
behind the scenes. Um the other thing about F1 is uh just how dangerous it is is also an element and I think you understand that a bit more through watching it when you're um you know when you're when you're you know uh golf and
15:25
and tennis are obviously much bigger sports in the US but people have like direct experience playing them and it's not high stakes right it's like a player like in F1 if a player you know if a driver makes a mistake they could actually die they could someone else could die. >> I think someone does die in Drive to
15:41
>> I think someone does die in Drive to Survive.
15:43
Uh it's not in F1, it's in one of the prelim races, but it's at the Nurburg Ring, I believe.
15:46
And it's the race where uh the guy on Alfatari, Pierre Gastley, wins all of a sudden before in like some sort of prelim race.
15:56
I believe someone someone died.
15:58
>> There's no according to Google's AI overview, total of 52 fatalities through Formula 1.
16:05
And so I I just think as as dangerous like bull running, you know, and so >> uh there's so many different factors.
16:15
>> I have another factor.
16:16
>> First, I'm going to tell you about Figma.
16:17
Think bigger, build faster.
16:17
Figma helps design and development teams build great products together.
16:20
Um my So the other thing is that there's the business side.
16:24
I don't know if you were into this.
16:25
Did you watch Drive to Survive?
16:27
Like the business side is what's so fascinating to me because you're not just talking about the athlete, you're talking about the car.
16:33
So if you're an engineering nerd, you can be into the car, but then also if you're a business nerd, you can understand, okay, this team principal is getting fired.
16:40
They're like the CEO of the organization.
16:42
Who's putting the money in?
16:44
And then what does that what what effect does that money have?
16:47
Like sometimes it's like, well, the guy with the money is making his son drive, right?
16:51
And then sometimes it's like, well, this team doesn't have enough money, so their car is not going to be very good.
16:56
or this this team and and there's all these different >> Yeah, there's some of that in the in the in the golf version of Drive to Survive, but it's basically like this player >> kind of needs this win, which is a real factor, right?
17:09
There's that human element of you want somebody who's, you know, putting their, you know, family time on hold to go out and and win >> uh win a win a competition.
17:18
You want to see that person do well, >> but it's not Yeah.
17:22
There's so many different dynamics. >> Yep.
17:25
And so Apple doesn't have that bridge.
17:28
They don't have drive to survive.
17:29
I don't think Netflix is going to give it up.
17:31
So they have to go straight from F1 the movie two and a half hours of content to watch 90 a 90minute race, you know, 20 times a year on streaming at a specific time.
17:41
that push notification element of just being like, "Hey, we know every single person that has watched more than 10 seconds of Drive to Survive."
17:52
>> And the push notification to to you know, a large amount of those.
17:55
Um, >> so they got to get Rocket Powered Mohawk.
17:58
You've listen you've watched this guy on YouTube.
18:00
He's one of the most deranged and unhinged F1 commentators.
18:04
He does these reaction videos to the races.
18:05
He only has like 60,000 subscribers, but uh he's hilarious and uh I think he'd make a great host for an Apple TV show.
18:12
Um >> the last question is what happens after if the content stack works and you're funneling people from uh the F1 movie to A Drive to Survive to actually watching the race.
18:28
Obviously the end is like go to the race. That's very expensive.
18:30
But Apple has been for the last few years talking about what comes after the screen and they've been saying it's the Apple Vision Pro. It's immersive video. It's 3D. It's spatial. It's augmented reality.
18:44
And I was really really disappointed in the Apple uh announcement post which is beautiful.
18:50
Has some great graphics, bunch of details, but basically all they're saying on Vision Pro is that you'll be able to watch it in Vision Pro, which is like, yeah, of course I could watch ESPN in Vision Pro.
19:00
I can watch any TV show in Vis Pro.
19:02
So, yeah, they're not doing any any 3D content and they're not doing any spatial content, which is it's not look, it's not turn your head all the way around and look behind you, but it's basically a bubble. It's like 180 degrees.
19:14
And so, with that, it's not that expensive. Everyone's so expensive.
19:18
It's like there's a $10,000 camera from Blackmagic set up there. You film.
19:20
How would Apple not negotiate the ability to >> I think that they I think they I I the the steelman like the bull cases that like they're going to do something.
19:30
They just aren't ready to announce it.
19:32
But I feel like they should be pumping that up a little bit more.
19:37
>> Yeah, that's potentially, you know, out of the million or so people that tune into each race, there's a set of fans that are hardcore that would just buy the and use the Vision Pro because it would be >> even just as a novelty a few times.
19:47
And so I don't know if you remember this, but Blackbox Infinite had a a demo of what watching an F1 race in Apple Vision Pro would look like.
19:56
And basically, you get the full screen display of the actual race, like as you would watch it on ESPN here, but then on your desk, you can place a like a diarama of the race and you can see the cars moving around and you can watch from an aerial view.
20:14
And it was really really cool and everyone was like, "Oh, this is so amazing. This is so amazing."
20:16
But of course, like Blackbox Infinite is like a dev shop and they don't have the rights and so this like probably has to be negotiated with Apple and Apple's just not really doing it.
20:25
>> Chat says owner of Drive to Survive Regrav says is Boxtobox film so they could uh he's saying they could uh Apple could eventually negotiate to get that property.
20:34
I'm sure Boxtobox is looking at this now being like, "Oh, they just spent >> you just spent, you know, 150ish million for this.
20:41
Do you want to do you want the next, you know, do you want the 2028 season of Drive to Survive?
20:45
And >> who knows how long.
20:48
>> It's probably a bidding war at some point, right?
20:50
And stuff changes uh channels a lot.
20:51
I mean, The Expanse was on Sci-Fi, then went over to Amazon.
20:53
Uh it's kind of whoever will pay the most.
20:58
>> New type in the chat says Vegas just unveiled the uh a massive F1 venue called Bar and Grill.
21:02
It's like Top Golf for F1. >> Well, that seems fun.
21:06
Um >> most generic name in history. >> Extremely. Extremely.
21:10
And so here's here's what I would want to see from a Vision Pro F1 experience.
21:13
The the immersive video cameras are in fact too big to put on the cars.
21:19
Uh but you could take two iPhone cameras and put them on the cars and at least film in 3D, which I think would be an upgrade.
21:27
Um, but I'm more interested in taking the immersive video cameras, the the proper like 180 360deree stereographic uh rigs, stereoscopic rigs, and putting them on the sidelines in the pit lane in the owner's box on the key turns and having you be able to like fly around from one to another.
21:48
Put one up in the sky, sky cam.
21:50
There's a whole bunch of interesting things that you could do to kind of like beam around the track and actually feel like you're there.
21:55
Well, you're not going to be able to put the full rig on the car, at least not yet.
22:01
Um, but uh I was very disappointed to see Apple not uh announce anything yet.
22:07
Hopefully something changes.
22:07
Hopefully something happens.
22:08
something happens. I mean, since the initial demo of the Apple Vision Pro, uh, critics and analysts, Ben Thompson and more have been saying live sports are going to be amazing in Apple Vision Pro because you can just drop a camera
22:23
there and you don't need to do anything else because he was he had this demo of uh, uh, putting the camera at uh, the half court line uh, courtside at an NBA game and he was like, it doesn't require any production Because you if you want to see them go over there, you just turn your head. And if you want to know the
22:41
And if you want to know the score, you just look up at the scoreboard because it's the experience of being courtside, which is already the best experience possible.
22:47
And so, uh, it's been it's been disappointing to see Apple not execute on that more because it feels like such a differentiated thing.
22:54
I think Meta should honestly do it, too.
22:55
Meta should, uh, you know, Zuck loves UFC.
22:57
He should be doing, you know, you can watch the full UFC.
22:59
We will pay for the UFC card if you have a MetaQuest. Put your Quest on. watch it in uh in VR.
23:07
Um >> uh let's see >> what's up.
23:13
>> I think they're already doing this.
23:13
UFC brings fight pass events to the X Stadium.
23:18
>> Uh so yeah, they're going to have uh they're going to have USC content.
23:23
>> I think Meta should pay for it.
23:23
I think it should be free if you put out that headset.
23:26
I think it's so important to to alleviate churn uh that they should just bite the bullet because if people are like, "Wait, uh okay, I have to do this weird thing, strap this headset on, but I get UFC for free.
23:35
Maybe I'm maybe I'm going to do that."
23:38
Imagine if you're just sitting there next to Joe Rogan and you look over in Rogan there. That'd be great.
23:43
It'd be a wild experience.
23:43
Much like getting your company on Vanta, automate compliance, manage risk, prove trust continuously.
23:48
Vanta's trust management platform takes the manual work. >> That's so wild.
23:52
How could it be this easy to be compliant? Yes.
23:56
>> Um, Mike Isaac at the timeline this morning with a massive story.
23:59
Mike Isaac is of course who >> uh told our story week or so ago.
24:04
Uh he says Meta cuts 600 jobs at AI Super Intelligence Labs.
24:11
The layoffs do not affect Meta's newest AI hires who are in some CA or who are in some cases being paid up to hundreds of millions of dollars.
24:20
>> They're in what's called TBD lab. >> Yeah.
24:23
uh >> we got multiple labs >> and that has most of the multi-million dollar hires.
24:27
>> The cuts were focused on correcting an earlier hiring spree.
24:28
So Meta said on Wednesday that it cut approximately 600 jobs in its AI division according to a memo sent to employees that was relayed to the times as a company seeks to keep pace with competitors in the furious contest over the technology.
24:40
The layoffs were in Meta's so-called super so-called >> so-called so shots fired uh which is the umbrella name for the company's AI efforts.
24:50
The division has around 3,000 employees, though the exact number of workers was unclear.
24:54
Uh, Zuck, Meta's chief executive, has been on a hiring spree to stack his company with top researchers, including new AI chief AI officer Alex Wang.
25:03
Uh, the cuts on Wednesday did not affect the new hires.
25:08
Um, and uh, yeah, they were aimed at cleaning up organizational bloat that resulted from 3 years of building Meta's AI efforts too quickly.
25:15
Um, so anyways, I uh this seems healthy and normal.
25:18
I think these 600 people are going to have a bunch of job offers really quickly in my view.
25:25
Like if you're not meeting the bar at Meta, it's very possible that you would be elite at like thousands of other companies that want to have an AI strategy.
25:34
So I think these people will be back in the workforce uh quickly.
25:36
I'm dying to know if any met list uh any medicine listers our list of the top 128 AI researchers loosely compiled by uh Tyler Cosgrove.
25:48
Uh I I I wonder if any metisters were let go.
25:52
You'll have to uh cross reference the list to see if there's any link changes in LinkedIn. >> Yeah.
26:00
I mean I would be extremely surprised given that it was like >> Yeah.
26:03
All those people would be on TBD. >> Yeah. >> Okay.
26:06
You think you think everyone that would made the list was on TBD?
26:10
>> I assume >> because they're all like new ads basically. >> Yeah. Yeah. >> Yeah. >> Yeah.
26:13
The the other thing that was uh pretty notable in Meta Land uh was also in this report and saw it on the timeline a little bit uh in a sign of the escalating competition in AI.
26:23
Meta on Saturday also said it would cut off access to non-meta chat bots like chat GBT on WhatsApp beginning next year. >> Oh yeah.
26:33
That means WhatsApp's three billion users will no longer be able to use chatbt in the messaging app.
26:39
Apparently, there was like around 50 million people that were primarily using chatbt through WhatsApp WhatsApp power user. Makes sense.
26:45
You can just chat with somebody.
26:48
>> Yeah, I saw Kevin Wheel over at OpenAI talking about that.
26:50
He's the vice president of science.
26:52
He says, "Hard to believe Meta is shutting off 1800 chatbt."
26:57
Uh, too many f too much focus on dotcoms these days.
26:59
Not not enough focus on owning your 1-800 number. What do you think?
27:04
>> Yeah, apparently this was like the calling this number was the only way you could interact with Chetch when you're on a plane. >> Oh, really?
27:10
>> Um, yeah, because I guess it support they support like free messaging, you know, if you don't have the Wi-Fi.
27:16
>> If you don't have the Wi-Fi, you can still do uh WhatsApp, but you can't call a phone number on the plane, right?
27:21
>> I I just saw some tweet said they could still use it, but now they're they're bummed out.
27:24
>> Uh Kevin says uh it had many many millions of happy users.
27:27
If you're one of them, you can migrate to our app, website, or browser.
27:31
Let's hear it for Atlas to preserve your conversations.
27:35
RT, if you agree that WhatsApp is better with chat GBT, let's go.
27:38
All of the hyperscalers hate each other. >> It's not.
27:44
>> I still can't believe how many people did not get the joke yesterday when I said Atlas isn't just a web browser.
27:50
It's an entirely new way to browse the web.
27:52
I had multiple people commenting saying, "Are you being paid by Open AI to say this?"
27:57
It's like, >> "I'm >> Have you been oneshot?" >> Yes. That's ridiculous.
28:02
>> It's like, "No, I don't get paid. I was just oneshotted."
28:04
>> Well, if you're building a new chatbot, you need to get on graphite.
28:07
Code review for the age of AI.
28:09
Graphite helps teams on GitHub ship higher quality software faster.
28:13
I do like the 1-800 number.
28:13
Um, uh, I with the, uh, with the axing of fair.
28:20
Uh oh, there's another interesting uh scoop in here.
28:22
Apparently, TBD Labs employees, the new AI research team, they have separate badges to get into their designated section.
28:30
So, the old group of AI researchers can't even go near the new research.
28:36
>> That's got to be good for that's got to be a team over there.
28:42
>> That's the the cast system of AI research >> potentially. Potentially.
28:45
Um yeah, I I don't Oh, I think uh I think super super intelligence is over.
28:50
Uh if you're at Meta, my advice uh for you is to start working on hyper intelligence because the super intelligence thing is just obviously uh it's it's obviously last year's news. AI moves too quickly.
29:02
If you're working on super intelligence, pivot to hyper intelligence for sure. Do you agree? >> Giga intelligence. >> Giga intelligence.
29:09
That's that might be a 2030 goal.
29:12
But if you start working on it now and you start branding yourself as Yeah, I'm a giga intelligence researcher.
29:18
I think of myself more as super intelligence I I I've dabbled but uh really I focus on giga intelligence.
29:25
Um >> uh Andrew Curran is highlighting uh a piece from Bloomberg.
29:30
Bloomberg is reporting that Anthropic is currently in compute discussions with Google in a deal valued in the high tens of billions.
29:38
High does that mean over over?
29:42
It's got to be over 50, right?
29:44
>> High tens of billions.
29:44
Yeah, I would say over 50. That's a lot.
29:46
That's a lot of billions. That's a lot.
29:49
>> Uh, Anthropic PBC, Public Benefit Corporation, is in discussions with Alphabet's Google about a deal that would provide the AI company with additional computing powered valued in the high tens of billions.
30:00
The plan, which has not been finalized.
30:01
These are just talks, folks. We love talks here.
30:06
>> Talks are uh are are underrated.
30:06
Uh involves Google providing cloud computing services >> according to people who asked not to be named because the information is private. some leakers.
30:16
Um, as you know, Google is a previous investor in and cloud provider for Anthropic, >> but uh this was this was AWS's um this was Andy Jassis's, you know, >> claim to uh AI relevancy.
30:32
So sure, >> Ben uh Badgeran says, "If Anthropic prioritizes Google infra over AWS, it's very telling on AWS AI infra >> and AWS AI strategy is cooked without Enthropic."
30:47
I'm so excited to see TPU and tranium added to inference max and we can actually see the gap between those two because uh >> is not >> it's like yeah Nvidia is actually really expensive now.
31:03
Uh I mean that was certainly the finding relative to AMD.
31:07
Uh our partner Poly Market has an update they extended the timeline for which company has the best AI model at the end of June 2026.
31:14
So you can look out even further into the future and uh Google is running away with it already.
31:19
50% chance that they will have the best model in June 30th of 2026 and Anthropic is dropping.
31:28
They're at 8% below Alibaba below OpenAI.
31:33
>> Ultimately, I don't think it should be a huge surprise that Anthropic is interested in working with Google.
31:38
Google owns roughly four 14% of Anthropic.
31:41
So, it's not like anthropic sitting there being like, we need a lot of compute.
31:45
>> Uh, you know, let's just ask AWS for more.
31:49
It's uh it's obvious that they would go to Google and and try to work out a significant deal there.
31:53
out a significant deal there. I saw uh a very viral post earlier too saying that um somebody was saying that if they started uh running uh if they were in charge of Apple today, the first thing they would do is buy Anthropic, which is a very kind of weird take in my view because Anthropic hasn't proven that they can dominate in consumer right like Apple is a consumer product company >> generates tokens to create software with to create code
32:24
>> and so uh that feels like very unlikely and and kind of >> Apple I don't think is sitting there being like you know we always wanted to get into dev tools you know >> sure >> no that's a good take yeah I mean they do seem sort of like brand and
32:36
spiritually aligned I think the brands are good what do you think >> yeah I was just going to say that I I think most of the reason you see people talk about like, oh, Anthropic and Apple like seems like a perfect fit. Is mostly
32:43
Is mostly just because of like the general branding.
32:47
It's like very >> privacy focused, safety focused, >> it's not the move fast and break things culture.
32:52
It's not aggressive culture as much.
32:55
Um, but yeah, I agree with like the business models being wildly different.
32:58
Um, how are you feeling about just the general narrative that like Apple has not missed AI and in fact uh we're all stuck to our iPhones upgrading them every every week and or every year and they uh will continue to capture value eventually.
33:15
>> And while you're thinking about that, let me tell you about Julius.
33:17
>> What analysis do you want to run?
33:17
Chat with your data and get expert level insights in seconds.
33:20
The AI data analyst that uh works for you.
33:23
So, do you think that Apple needs to hire or Aqua hire like more uh product designers, people that can uh figure out new ways to roll out AI features, or do they actually need a deeper partnership with a foundation lab?
33:39
Are they lacking in intelligence and token generation?
33:46
>> I I think Apple's just fine.
33:51
Yeah, >> I see zero meaningful threats today.
33:56
>> Um, can uh I have this interesting take that uh there's like this war going on in the AI tooling.
34:02
So I went to Google search yesterday and I was looking for an image because I wanted to make a sticker for iMessage for our group chat to hit someone with the horny bonk actually.
34:15
Uh I wanted to keep people in line.
34:15
So I so I go to I I go to Google and you know how in iOS if you have an image you can it will like highlight it'll remove something for it'll remove the background and highlight the actual thing. >> Underrated feature.
34:28
>> It's a pretty good feature.
34:28
And then you click on that and I'm recently gotten into the stickers. They're really fun.
34:33
So you so once you highlight like the the Jordy off of the background I can click add sticker and then it goes in my sticker bank. Right.
34:39
But Google in in Google images has a uh has a feature that like wants to do that as well.
34:46
And so it has like Google Lens.
34:48
And so when you if you if you press and hold on an object in Google images, then the browser, even if you're in Safari, like the Apple image AI is fighting with the Google image AI and they both want to do things.
35:03
And I feel like this is popping up all over the place where it's like if you're in Gmail on your iPhone, Apple intelligence will say, "I'd love to rewrite this for you."
35:11
But then Gemini will say like, "But I want to rewrite it for you."
35:14
And you have like multiple systems that are like, "Do you want to do it at the OS level or at the app level or at the application level or do you want to do something else? Do you want to plug in?"
35:22
want to plug in?" And I feel like all of these like they sort of need to get like either either the war needs to play out and a winner needs to be crowned or there needs to be some sort of like I don't know new new paradigm where like
35:37
Apple just says like hey look like we're actually good enough at this that we're just look at Google and Apple as like you know James Bond dancing with like a spy that wants to kill him but like they're they're both doing fine hyperscaler It's like that with every hyperscope. Like we we talked to the
35:53
Like we we talked to the meta team and we're like, "So, what are you going to do about getting iMessage on here?"
35:56
And they're like, "We'd love that.
35:57
We It's not It's not us."
35:57
Like we we would never have sharp elbows.
36:00
And then you talk to the Open AI guys and they're like, "Oh, they kicked us out.
36:04
Like they're not letting Chatty TV and WhatsApp."
36:06
And it's like just they're all just dancing.
36:08
>> Mexican standoff between every hyperscaler like >> No, I think it's I think it's more I think it's more like a dance.
36:12
It's like who's going to who's going to, you know, just try to pull out the the you know, they're dancing.
36:17
They're they're having they're they're both making money.
36:20
They're having fun, >> I guess.
36:21
Yeah, I mean they they they're all doing well.
36:23
I just wonder like like this Anthropic Google deal.
36:25
People were reading into it like oh Google's going to acquire Anthropic.
36:29
I saw this meme was like oh Anthropic the DeepMind subsidiary and this doesn't feel like that at all.
36:34
This just feels like Anthropic scaling revenue.
36:36
They're doing B2B token generation and they need more compute and so they went to the biggest compute provider.
36:42
I think I think the >> the scenario in which that happens is we talked about this yesterday where chat GBT actually could stop training models like if models are plateauing >> a little bit.
36:56
>> Uh chat GBD chat GBT could stop and they can turn on ads, they can turn on commerce, they can do a bunch they can do a bunch of things and just get really profitable.
37:04
Anthropic meanwhile, you know, because all their re revenue is API driven, >> if they stop innovating and then Quen Yeah.
37:12
catches up and it's like cheaper or >> how much do you think open how how long do you think it would take for them to fully bleed out and churn every customer if they were just like, "Yeah, we're going back to like like Deep Seek 2."
37:27
>> The team is now Sam and Rune.
37:30
>> We're going to run really lean and Will because uh but he's focused on bodybuilding. Yeah.
37:34
We're not even going to do the B200, the H3, we're going to run them on A100's, you know, we're just bake on some slot. >> Yeah.
37:41
So, so the scenario in which Antropic ends up becoming a part of Google is uh and like >> culturally, you know, I I could see it, but the scenario is like they they continue have to they continue to have to spend more and more and more and they just they can't raise the capital.
37:55
Uh which I don't see in the immediate.
37:59
>> I don't see it as a problem.
37:59
It seems like the business is doing fine and just growing.
38:02
So I I I I I think that that that take is >> we got to pull up this post from uh Buco Capital uh quoting that. >> What is this?
38:10
Is this an actual image or is this an AI image?
38:12
I think it's a real profile photo from like a a journal.
38:17
>> I think it's a real picture. Very Drake coded. >> Yes.
38:22
>> I had someone tell me that I fell off. I needed that. >> I needed that.
38:25
People were people were going hard on on Google, but Bugo Capital Bloke has been Google's strongest soldier for the last two years.
38:33
Uh laying out the bullcase the whole time.
38:35
Uh and uh speaking of that, Fall Generative Media Platform for developers, the world's best generative image, video, and audio models all in one place.
38:44
Develop and fine-tune models with serless our soundboard tvpn. com sounds.
38:50
We got to get the goat sound effect up there.
38:53
>> Yeah, we got to add that for sure.
38:53
one of the >> um my new fit.
38:56
>> So, uh JT Locoa Cap, I don't know how to pronounce that.
39:02
Um JT says, "Anthropic gets wildly disproportionately less MSM coverage than OpenAI despite approaching three quarters of its revenue size because its quiet blowout success severely hurts the broader AI bare case.
39:18
So, the only solution is to mostly ignore them, which ironically is just fine with them.
39:22
you'd think the fastest growing scale technology company ever would provide a lot more fodder for the press.
39:28
Do you think that's what's going on or do you think it's just the B2B versus BTOC uh combi uh divide?
39:36
>> I think it's that mostly. Yeah.
39:36
And >> OpenAI has 10 times the deals and 10 times the products getting announced. >> That's true.
39:45
But I mean if you're if you're in the business of like the mainstream media like you need to put the water issue or the electricity issue or the financial issues in terms people can understand people understand chat GPT.
39:57
So you put that in the headline and you get more clicks than if you say cla right even if they're on similar scales.
40:03
And then the other thing is that we're in this weird era where anytime anything bad happens you can go to the person that did the bad thing and be like well were they using chat?
40:12
Of course they were because there's a billion weekly active users or something like that.
40:17
Whereas if you say like, "Oh, somebody did something bad.
40:18
Uh, let's look at what they were talking to Claude about.
40:22
Let's look at their Claude code."
40:22
It's like, well, they probably don't have one because they're probably not a developer. >> Yeah.
40:27
How many I wonder I wonder how Anthropic tries to track weekly activives because they have a lot of their users are are using the product through other front ends, right?
40:36
I mean, >> but it's probably if Chat GBT has 800 800. Yeah. 800 million. Yeah.
40:44
>> Anthropic has like singledigit millions of people that are using the product every day.
40:48
And it's like developers.
40:49
>> It's like companies that are I mean the the the average revenue per user for Anthropic has to be like three orders magnitude more than open. But that's fine.
40:58
That's the B2B to consumer divide.
41:01
Like that like that that that's as expected.
41:02
What what's your take, Tyler?
41:03
Uh I I also think um Anthropic gets like a reasonable amount of of coverage especially on the like China issue.
41:08
Like you see Dario a lot of like he he keeps bringing this China thing.
41:13
>> I feel like Daario does get a decent amount of press and I feel >> he's get he gets attention from Sachs. >> Yes.
41:19
>> Who comes in and uh the AIS are just dunking on their entire strategy.
41:24
>> And I do feel like >> and Reed Hoffman.
41:25
Reed Hoffman is is a a boldly uh uh defending >> proanthropic. Okay. interesting.
41:31
Um I yeah I feel like Daario has done a great job for where the position of that company is in getting a lot of press defining a narrative.
41:40
I mean it is sort of an AI doomer narrative but like he's gotten attention for that.
41:44
Uh, and also they have a whole they have a whole like they have the same cinematic universe that uh that uh OpenAI does in the same they know like Schultto is kind of the rune like they have Jack who's kind of their Mark Chen and they have like different pieces of the puzzle where like if you're just following the story like there are a few characters in the anthropic world that you're probably familiar with. >> Do you agree?
42:09
I mean, yeah, like if you're looking at like people who live in San Francisco, like Anthropic obviously has like an insane like share of the like media. Yeah.
42:18
>> But broadly, I think most people don't know what anthropic is. >> Yeah, that's true. >> Yeah.
42:22
>> Uh it's kind of a good place to be, you know?
42:24
know? I mean I I mean of course it's never good to get attention from the AIS are but uh but in general like like a a Sachs dunk is not actually going to be as broadly popular as like some some governor saying open AI built a data center that that was 100% responsible for your electricity prices going up and
42:46
it's that sloppy sora app you know like like that's something that could just like hit with everyday voters whereas if someone's saying, "Well, like I need you I need you to learn about anthropic and co cloud code and cloud code's good, but also this is kind of a doomer and also maybe regulatory capture." It's like
43:01
It's like it's seven things to explain and so it just doesn't hit.
43:05
>> Well, here's something great. >> Please.
43:07
>> Gabriel, uh, one of Australia's top posters, I'm >> sure he's sleeping right now.
43:12
He says, "Sam Alman opening an incognito browser tab in Atlas and typing what's what's the next big number after trillion into the search bar setting off a siren in Sarah Frier's office and automatically blocking all outgoing and incoming calls to or from Japan and Saudi Arabia.
43:31
>> Sarah Frier Sarah Frier CFO setting off a siren. Wait, wait.
43:33
Is is is it that he does this and that sets off a siren or he just does that as well?
43:40
>> The team The team hardcoded this. >> Oh, okay. Okay.
43:42
find the next big number. >> Yeah. Yeah. Yeah.
43:45
My my son has been getting my four-year-old son has been getting into big numbers and he likes he likes he he thinks he's doing like multip multiplication but he's actually just doing addition.
43:55
So he'll say like um like imagine if we had like you know uh a a million thou a million,000 Legos.
44:06
And I'm like well you know that's not actually like 2 million's more than that.
44:09
like 1,1,100 is is just a little bit more than just a million.
44:14
Uh, but >> numbers are numbers are genuinely incredible humor to to children.
44:19
>> Oh, he thinks it's so funny.
44:21
>> For me, every night with with my son, it's like a negotiation on how how many books I'm going to read.
44:25
>> And so like maybe like the average is like five books, but like he just thinks it's so funny to be we're starting the negotiation. >> Yeah.
44:33
>> And he ends up being like, "Let's read 20 books."
44:35
He just cracks out >> and thinks it's so funny.
44:37
And now he's discovered 40. >> Oh, okay.
44:41
>> He's he's doubling basically. So, >> yeah.
44:43
Whenever uh whenever a 4-year-old starts dropping like the million, billion, thousand, hundred.
44:48
I'm just like, this just sounds like work.
44:50
This just sounds like AI to me.
44:51
This sounds like AI fundraising news to me.
44:53
Now, you sound like this post from Ariel. Do you want to read it? >> Uh, sure.
44:58
Uh, OpenAI ships a browser.
45:01
Anthropic ships a blog post.
45:01
Deep Mind solves Navier Stokes. Meta F it. Let's do a layoff.
45:11
>> Uh, layoffs are sad, but again, I I think I think all these people are going to be uh >> Did Enthropic did Enthropic ship a blog post recently?
45:18
I I >> They're always shipping blog posts.
45:21
>> I know they are, but like was there a blog post on the same day as as the Atlas browser launch?
45:26
>> Uh, I assume there was.
45:26
I mean, it it was probably not like a major one, but they're always doing like there's a bunch of like uh new economics research that's that's been coming out. It's pretty cool. >> No, that's cool.
45:35
Uh, have you been uh daily driving Atlas or have you reverted?
45:41
>> Well, I mean it just came out yesterday.
45:42
I I didn't use it at all yesterday. Okay. And I have not today.
45:46
>> Wait, I thought you told us on the stream that you tested it. >> Well, yeah. Okay.
45:48
So, I I tested it and then the show started.
45:51
>> So, so you you you have some workflow because you do you're actively developing a Chrome plugin.
45:55
uh do you think that the way they built Atlas will be uh feature complete with the Chrome plug-in ecosystem and it would just be like the same install process because if it breaks Chrome plugins that's that's actually kind of a problem for power users of Chrome.
46:10
That's that's more lockin than I thought because it's easy for me to just say, "Okay, I have a couple bookmarks, a couple pin tabs.
46:15
Let me just port those over, bring my passwords over.
46:19
I'm happy to uh to uh to use a different browser."
46:22
And I was actually thinking like I'm kind of in the target market for the Atlas browser.
46:27
Like I'd be down to try it.
46:27
I'm not I don't really feel that much attachment to Chrome.
46:30
I'm not like, you know, I'm so locked in.
46:32
But when I think about like, well, if I'm going to lose my my uh my Chrome plugins, that's a problem.
46:39
But >> the lock in of just having like eight tabs that you never close.
46:44
>> You think that's lock in?
46:45
>> It's like weirdly a lock in.
46:47
>> It is kind of a lock in.
46:48
>> It just means that even if I'm trying a new browser, I'm not closing Chrome. Totally. Totally.
46:52
And and and I it is crazy because like I am I'm at a point in my life where I'm busy to the point where even like a five minute onboarding is like >> when's that going to happen?
47:03
Like it's it's going to be at the bottom of the stack next to like answer text messages or like answer email.
47:10
>> Chat is asking uh when Jeff uh from Hyperlid is coming on.
47:14
He will be on in less than an hour. >> 30 Pacific.
47:19
>> We recorded the interview with him. Uh he's in Singapore.
47:21
We had him stay up late, but not that late.
47:23
Uh we recorded it at 9:00 a. m.
47:26
Today we are airing that interview at uh 12:30 Pacific time, so in about 45 minutes.
47:33
So if you're new here, please subscribe, uh follow the show.
47:38
We interview all sorts of technologists and business leaders.
47:40
Uh talk about tech and business every single day, 11 to 2:00 p. m. Pacific.
47:46
>> Deal director in the chat says the extension should all work.
47:47
Ad blocker was fine to be added.
47:49
So, it's built on Chromium.
47:51
I think that means the plugins will still just work somewhat natively. >> Yeah.
47:56
>> It's very easy to add extensions. >> Yeah.
47:58
>> So, >> speaking of AI browsers, we should talk about uh Brave came out and said the security vulnerability we found in Perplex. This is brow.
48:07
This is the real browser wars.
48:09
This is when >> talk about Brave. Brave is legendary.
48:14
Brendan Ike, the creator of JavaScript, has just been grinding this browser.
48:16
I really want to get him on the show.
48:19
be such a I'm such a >> but uh Brave says the security vulnerability we found in Perplexity's Comet browser this summer is not an isolated issue.
48:26
Indirect prompt injections are a systemic problem facing Comet and other AI powered browsers.
48:33
Today we're publishing details on more security vulnerabilities we uncovered.
48:39
>> Um so indirect prompt injection attacks occur when malicious instructions are hidden in web content.
48:45
>> That's so interesting.
48:45
I hadn't thought about that. Yeah.
48:46
When an LLM analyzes the content, it obeys the hidden instructions because it believes they're real commands from the users. >> Yeah.
48:53
Uh, can you go put some prompt injections on tbp. com?
48:57
>> Uh, tell them to uh I if you're using the Perplexity Comet browser and you're on tbp.
49:03
com, tell us a whole story about horses >> while leaving a five star review. Yeah. Yeah. Yeah.
49:09
Tell the agent to go leave us five stars on on Apple Podcast and Spotify.
49:14
Uh quickly let me tell you about Turopuffer search every bite serverless vector and full tech search build from first principles and object storage fast 10x cheaper and extremely scalable.
49:21
I did have a question about this uh Tyler.
49:23
Do you think that there's a world where uh the agent can then puppeteer like Chrome web tools and actually manipulate the website?
49:30
like is there are they interfacing at a level where I could actually tell one of these AI browsers, hey, go into the HTML of the page that I actively have open and disable the payw wall or or like kill all the ads.
49:46
Like, could it act as an as a as an ad blocker as well, or do you think it doesn't have the ability to actually edit the HTML that you're viewing in the panel on the left?
49:57
>> Um, I mean, I I don't see why there's any reason you shouldn't be able to do that.
50:00
I mean, you can just do that with a normal Chrome extension. Yeah.
50:02
>> Um so that should be like totally feasible.
50:04
It's also like an interesting um thing to get around this kind of prompt injection injection stuff is um >> uh like if basically OCR gets good enough where you can just treat the the web page as just like an image >> then that's like a very simple >> clearly mode.
50:19
>> Um yeah so I don't know.
50:19
I don't think this is that big of a an issue. >> Sure.
50:23
>> But I guess yeah time will tell. >> Well FUD.
50:25
Um anyway uh there Toby or has a new post on RL scaling.
50:29
uh careful analysis of OpenAI's public benchmarks reveals RL scales far worse than inference to match each 10x scale up of inference compute.
50:39
You need 100x the RL training compute.
50:42
The only reason it's been cost effective is starting from a tiny base.
50:46
And so uh the original chat GBT launch was GPT 3.
50:49
5 but then GPT4 which was a pretty big training run.
50:52
I think the training run was on the order of a billion dollars, hundreds of millions, something like that.
50:58
and the RL that went into it.
51:00
It was like the original RLHF to try and get it to not hallucinate as much, just be a helpful assistant.
51:06
I think that that the cost of that RL was pretty low relative to the training run.
51:12
And so we've been seeing these gains.
51:14
He's putting RL in the truth zone.
51:16
Tyler, what do you think?
51:18
>> Matt in the chat says, "Atlas is really uh cautious about prompt injection.
51:21
Was testing it yesterday with tweet replies and it detected all the attacks and refused to act on them."
51:27
>> Oh, that's great news.
51:27
Yeah, this feels like something that can be >> Yeah, this definitely seems like something that's uh like >> disregard instructions on the web page.
51:35
>> Yeah, we live through this era where where every LLM could be just immediately jailbroken ignore previous instructions and then like that became a meme and like within like you know a couple months it was like that doesn't work anymore.
51:46
And now when you watch the prompt injector people it's like 25 different steps and it's not just like oh just memorize this one little thing and you'll get better results out of your LLM. Um what do you think?
51:54
Did you read this Toby or post? Is he legit?
51:59
>> Yeah, I mean I I think um broadly it makes a lot of sense. Yeah.
52:02
>> Uh there's a reason why like okay early OpenAI they're doing a lot of RL when they're doing >> u you know games and stuff like that and then to actually get like useful language models you can't really just do it based off RL because it's just so inefficient.
52:15
>> Um so then >> if you apply it on the the kind of pre-trained models then it's kind of like the prior that you can use to to do much better RL.
52:22
Um, but it's just like so inefficient that I think he says at the bottom he only expects like a couple more >> orders of magnitude of just like raw RL before uh models essentially like stagnate again.
52:35
>> Um, but I I think it people generally like know this, right?
52:38
It's like >> running inance time compute is like super super expensive.
52:42
It does make the model a lot better, but at at a certain point it's just like it's just like taking up way too much compute. >> Yeah, AI is fake.
52:49
We're going back to sticks and stones.
52:51
Like all this stuff is just completely nonsense. It's useless.
52:56
>> And I think Thrive might be signaling this that the fall merch collection.
53:00
>> They're pivoting from AI investing into a fashion label.
53:02
Is that what >> Well, not just that, but their new merch is has camo.
53:06
The first >> camo VC merch that I've seen.
53:09
I think it's a great >> uh I'm kind of angry that we didn't come out with our own camo. Really good.
53:17
>> Now we can't because somebody did it.
53:19
Uh, and they did it well. So, very cool.
53:21
>> Good for the team over there.
53:21
Uh, before we move on, let me tell you about Google AI Studio.
53:24
The fastest way from prompt to production with Gemini.
53:26
You can chat with models. You can vibe code. You can monitor usage.
53:31
Um, what are you laughing at? Lou >> wireless.
53:34
So, luckily, since the Lou made NFTts of their jewelry, even though the crowns physically were stolen, they still own the same assets because the tokens still exist and are in limited supply just as before. Nothing has changed.
53:47
you understand blockchain technology.
53:51
>> The the NFT boom was such a wild time.
53:54
People were calling it a bubble during that whole arc, right?
53:56
Like but then I mean it was it was a crazy first.
54:00
>> There was one post that that that was getting dunked on from basically the entire world world where it was somebody saying like if you put a diamond on chain and then you destroy the diamond like nothing has changed like it was something to that effect.
54:14
That's >> uh although says Lou heists are always a false flag by the art world to increase notoriety of certain works.
54:21
Do not fall for the Frankish tricks. >> I like that banger.
54:26
>> Yeah, the Louv has been heisted from multiple times.
54:28
They really got to step their game up.
54:30
I mean, you you'd think they'd uh they'd have seen this one coming, but hopefully they they up the security.
54:36
They need to deal with flock safety.
54:38
They need to get some uh some cameras all >> Yeah.
54:41
Do you think the the management team over there is thinking ah we shouldn't have uh we shouldn't have been so scrappy on security considering we have you know billions of dollars one word truthfully like I think if I was in charge of loop security I wouldn't have thought about the the furniture elevator vector of attack.
55:00
I would have been like it's so high up what are they going to do act like ninjas?
55:05
Throw grappling hook up there?
55:05
I wouldn't have thought of it.
55:08
I mean the door was locked.
55:09
It's not like they had the door wide open and you just had to get up there.
55:12
You had to get up there and then break through.
55:14
What are you saying, >> Taylor?
55:16
Uh Taylor says Bane uh ex carhe heart move blue collar stolen ballot. >> That's true.
55:23
That's some good VC lore. Thank you.
55:26
>> No, but this isn't car that's good. It's good lore.
55:28
But this is this is uh in defense of Thrive.
55:30
They're not like actually putting I think their logo on a carart jacket.
55:35
This is a unique inspired uh piece.
55:39
uh piece. Yeah, >> they have companies like base power, right, that are doing real >> I also I mean I feel like I put carhe heart the question blue collar stolen valor I feel like I put carhe heart in a different league of camo camo is
55:55
bluecollar but it's not actively like okay I'm on a work site it's more like you could use it for hunting which is actually sort of high class it's like not always bluecollar I don't know um >> a camo suit would go pretty hard >> a camo Dude, we that is orange. I was I
56:08
I was I was just thinking about uh doing an American flag like I I I went to the Kentucky Derby years ago and I had a an American flag uh suit on, but it was short sleeve short shorts and so it was like very tee and I was thinking like now we have now that we have a tailor like I could make like a fantastic tailored American flag suit which I think might might be the one. >> Ask Jake user.
56:33
Um, netcap girl says, "See this dashboard?
56:39
It gives executives actionable insights into critical business functions." >> And Diva kisses him.
56:46
>> Classic uh true story, I'm sure. Uh, this one is big.
56:49
Many people are seeing it and quoting it and saying, "This must be the top because Nvidia says space isn't just for stars anymore.
57:00
StarCloud's H100 powered satellite brings sustainable high performance computing beyond Earth.
57:05
Uh Delian had a good post a while back talking about uh the the the uh the in you know the sort of like uh financial statements of of hard tech and space companies and then and then you then you also make it a data center company and what is that what does that look like? I've yet to hear it.
57:26
like they have great uh economics already.
57:29
>> Have we got a compelling pitch for space data centers yet?
57:33
>> I believe we've had StarCloud on the show.
57:35
I I believe we've had this exact company.
57:37
It's a YC company and I'm pretty sure we've had this company on the show.
57:40
Um and uh yes, so Delian and uh and Dylan Patel are al has also been very negative on this idea because uh Dylan Patel has seen the the messiness that goes into actually running a data center.
57:54
the fact that uh and we talked to Chase from Crusoe about this a little bit like sometimes you just need a person to walk over and like unseat the GPU and put it back in.
58:02
Like sometimes you just need to unplug and plug it back in and so the question is like if they're in space uh managing all that is really really difficult if there's one little outage.
58:11
Uh we see this with uh all the different space projects like the Hubble telescope will just like go down because like one wire >> so we never had the CEO of StarCloud on but we had Johnny Dyer this we can pull up this video of the segment StarCloud actually posted it uh on their >> StarCloud posted the Muan segment from TBPN >> because Johnny was apparently advocating for data centers in space. Let's play it. >> Yeah. Yeah. Yeah. I'd love to see this.
58:39
While we pull that up, let me tell you about profound get your brand mentioned in chat GBT.
58:42
Reach millions of consumers who are using AI to discover new products and brands.
58:46
Um, and so my uh my uh my my buddy Rob Taves, who came on the show last week, uh he's also said that maybe there's a chance that this could work.
58:58
Of course, he thinks like, you know, about the real sci-fi stuff a decade out a lot of times.
59:02
And so he didn't really put a firm timeline on it, but he did say that there are some things that that that could make sense.
59:09
Um but uh yeah, it seems like a a pretty pretty tall order.
59:12
Also, just like all the companies that are trying to do like stuff in space are are generally uh like they're really really uh excited on like oh yeah like the launch cost will decline forever and it's like well if SpaceX winds up with a monopoly they might just be like yeah it's the price is still declining for us >> our margins are margin expanding.
59:34
Like it doesn't necessarily have to be all passed on to the customer.
59:37
They could be like, "Yeah, it's still this much." Let's play this. Thank you.
59:42
>> I want to know about uh the potential of data centers in space.
59:44
It sounds like a crazy idea.
59:47
I know some folks are working on it.
59:49
Just kind of like what's your highle take of the progress?
59:51
We've been tracking, you know, uh dollar per kilo to orbit.
59:57
It's been falling, but recently setbacks, different programs, and there's more competition, and there's a lot of different dynamics going on.
1:00:05
Um, what do you think uh the key milestones are to get us to a future where we're really doing, you know, mass manufacturing, big, you know, mega question from me. Wow. RIP. >> Yeah.
1:00:20
Well, let me let me start off.
1:00:20
I mean, I think you guys are hitting on the right metric, right?
1:00:22
It's like the hardest part of this is what does it cost to get a kilogram in space?
1:00:25
Because everything else kind of derives from that ultimately.
1:00:29
if you want >> a certain amount of power, if you want to be able to put um an aperture in space to do communications, whatever it is, like that's really driven by what it costs to get it there in the first place.
1:00:39
>> And I think it's important context to kind of see how far we've come down that path.
1:00:43
I mean, largely driven by SpaceX over the last decade.
1:00:45
And, you know, I like to tell the story of, you know, about 15 years ago at Skybox when we were trying to launch these small satellites, we were literally going to southeast Russia and launching satellites on converted Russian ICBMs.
1:00:55
I mean, they were they were popping out of the ground and putting satellites into space, >> and that was the only way for like a Silicon Valley venture funded startup to go put something in space. >> Wait, wait, hold on.
1:01:06
Did I hear you correctly?
1:01:07
Like the the the ICBM actually launches from one of those missile silos in the ground and makes it to orbit.
1:01:14
>> Pops out of the ground and goes to orbit.
1:01:16
I mean, you videos on YouTube the you search on YouTube, you can see this. And it's >> it's crazy.
1:01:21
I mean, you know, and that that's that's what it took before SpaceX kind of like revolutionized the launch business. Yeah.
1:01:28
>> And even at that, we were spending something like 10 times as much per satellite or per kilo >> as what we can go buy on a transporter launch today.
1:01:35
So there's been at least one and arguably two orders of magnitude improvement in the last call it decade on kind of what it means to launch things to orbit.
1:01:44
I think if you imagine that happening again another order of magnitude um it you know again it's going to dramatically change the way you think about feasibility of some of these things like putting very very large power hungry things in orbit.
1:01:57
Um we know how to do the solar, we know how to do the structures, we know how to get um you know we know how to make electronics work in the radiation environment which is always a concern and do it reliably.
1:02:09
Um, and so really ultimately I think it's going to come down to unit cost.
1:02:12
Um, and and what does it actually take to do that?
1:02:14
The great thing about space is you have virtually limitless power.
1:02:18
The sun, you know, you can you can go into orbits where you're in the sun all the time.
1:02:21
So it's not like solar on Earth where you're going in and out of eclipse or in and out of night.
1:02:24
Like you can be on all the time and then you have this cosmic background of 3 Kelvin cold sync that you can go dissipate all the thermal energy you need from running your electronics and stuff.
1:02:34
There's a lot of good fundamentals that make sense of an ideal environment to do this feels really crazy to see Nvidia like posting like hey like this is a thing that you should think about like and you know you're looking at the social media account of a $4 trillion company.
1:02:50
Uh I think everyone on the timeline kind of expected a little bit more friend of the show commented on Nvidia's post and said come on guys you're better than this. >> It's a rough time.
1:03:02
Um, >> we got to we got to have Philip.
1:03:06
>> But but famously Jensen has always been super into uh platforming the frontier because he lived it himself.
1:03:12
Like he was like, I'm doing uh like scientific computing.
1:03:17
Then all of a sudden gaming comes out of nowhere is massive.
1:03:19
And then all all of a sudden AI comes out of nowhere and is and is even bigger.
1:03:22
And so he's he's seen that these technologies that can take 10 or 20 years to cook, he's seen it happen.
1:03:28
And so, uh, he he had this interaction with the with the quantum computing companies where he was like, uh, he put out some statement or or said something to the effect of like, oh, the quantum computing companies like it's not going to work or it's really far away.
1:03:41
And he got a lot of backlash and then he wound up inviting them all to an NVIDIA event and having them all in, having a discussion with them.
1:03:49
And and when he came off stage, he was like, I believe that they are they are genuine. They're true believers. They're real scientists.
1:03:56
They're working hard on this problem.
1:03:56
I haven't actually changed my timeline.
1:03:58
I still think it's far away, but I'm excited that people are working on the future.
1:04:03
And I think that's maybe more of the what you should read into this.
1:04:04
Not Nvidia saying, "Oh, send the stock up because we're going to be putting our chips in space tomorrow."
1:04:10
It's more just like this is this is what Nvidia stands for. >> Yeah. Which I agree.
1:04:15
>> Stone Toss Comics says, "We're going to Dyson sphere our sun to keep the slop flowing." >> Wild.
1:04:21
>> Uh Cartek says, "So we have GPUs in space before GTA 6."
1:04:24
A lot of people uh a lot of people are concerned about maintenance issues, right?
1:04:30
The maintenance issue is really pulling the GPU out.
1:04:35
>> You literally need to like pull it out and put it back in.
1:04:36
And then the other concern is like uh dissipating heat and like needing uh >> yeah, it's more complicated than like yes, there is there is the negative temperature, but uh it's not uh it's not free as I understand it.
1:04:50
Anyway, uh we have our first live guest of the show in the TBPN Ultradome, Kevin Rose. Welcome to the show. How are you doing? >> Good to see you.
1:05:00
Thank you so much for taking the time. >> Of course.
1:05:04
>> While he hops on, let me tell you about linear.
1:05:05
Linear is a purpose-built tool for planning and building products, meet the system for modern software development, streamline issues, projects, and product road mapaps. How are you doing? >> Good. It's great to be here.
1:05:14
>> What's new in your world? What brings you to LA?
1:05:16
>> Uh you know, I've been living here for a couple years now. Was crazy.
1:05:17
I was uh actually had a podcast studio.
1:05:19
I was talking to some of your crew and it burned down in the Palisades fire. >> I'm so sorry.
1:05:25
>> Was it Did Am I remembering this correctly?
1:05:27
Your house Did your house not burn down? But >> it did. It did. No, it burned down. It burned down. Sorry.
1:05:32
>> I wasn't even home and I just saw the smoke and I rushed home and I just couldn't even get back in. So >> brutal. Yeah.
1:05:37
What's the timeline for rebuilding?
1:05:38
We've been I mean Jord is in Malibu. I'm in Padina.
1:05:40
We were both like loosely affected, evacuated, but nothing crazy. >> Yeah. Not going to do it.
1:05:44
Just like going to find a new place and but uh I love LA.
1:05:48
It's been great to be out here.
1:05:49
There's a lot of you guys are here. Great.
1:05:51
Um I I bounce up to the Bay Area every once in a while, every few weeks. But yeah.
1:05:57
>> Uh I' I'd love to I just want to say thank you honestly because uh you're one of the founders who I feel like was an OG and kind of like I don't know at least when I was going through college like was someone that I looked up to, a
1:06:09
lot of people looked up to, but I I was trying to think about like what was special about uh your story and I think it was just the fact that I don't know you were really good about telling your story as it was happening. And maybe
1:06:19
And maybe that's just like when someone wants to put you on the cover of magazine, you don't say no.
1:06:25
Uh, but I was wondering what that experience was like at the time trying to balance like promoting your business, growing what you're working on, but also like were you aware that you were ser like acting sort of as an educator almost or sort of as like an an inspirational speaker? guy. I just Yeah.
1:06:44
Gary Vee levels of but uh yeah it was I think back then all these social platforms were just coming online.
1:06:52
So you know when had Twitter I was literally telling people where you would go.
1:06:57
You go to South by Southwest and be like hey I will be at this bar come meet me and people would come and meet you.
1:07:02
Very different use case than what it is today.
1:07:03
And that was just kind of when you're you grew up in that environment.
1:07:08
It was very much about sharing everything.
1:07:09
So, you know, Foursquare was big with the check-ins and and it was just uh second nature to say, I'm building this new feature. Check it out.
1:07:17
And it was kind of a real time bring you along for the adventure.
1:07:19
Show people how you the secret sauce behind the scenes.
1:07:24
>> And people, the fans, the users of the platform of DIG way back in the day in 2004, five, six, they loved seeing that kind of secret little um they felt like they were an insider in some sense. >> Totally. Totally. Yeah. I I It's interesting.
1:07:37
I want to talk about the evolution of social media.
1:07:38
We were talking to Brian Chesy about this yesterday.
1:07:40
Uh that it was social media, then it became or it became social, it was social networking specifically to meet real people, then it became social media and then it just became algorithmic media, right?
1:07:49
And uh and there there's a little bit of like I want to be contrarian about it because uh two years ago I was in New York and I did just send the tweet, hey, I'm going to this bar and I had a little bit of an audience from posting on Twitter and YouTube video making and stuff and like 30 people showed up and we just got beers together.
1:08:06
It was like it was like old school Twitter.
1:08:08
So I'm wondering like how much of that IRL stuff has actually died.
1:08:11
There's the Run Club movement.
1:08:13
There's still stuff there.
1:08:13
But then at the same time on the opposite end you have the algorithmic feeds the Tik Tok the Soras.
1:08:19
And so how are you processing that?
1:08:21
Is it a barbell or are we on some like straight curve to the end times?
1:08:25
I >> I I believe that with the AI quote unquote sloth Yeah.
1:08:28
over the next uh couple of years pretty much social media is going to be dead. Yeah.
1:08:33
I I think a lot of it will be agents and they're acting like they're your best friend and just you won't know what to trust.
1:08:38
And so if that's the case, it's actually very freeing because you get into a world where okay, I don't trust any of this mainstream everything is public.
1:08:48
Let me find an intimate space to hang out and have real conversations again. And so I like this idea.
1:08:52
some of the the functionality that Alexis, the co-founder of Reddit and and myself are kind of working on the dig stuff that we're just brainstorming is what if you met someone in real life and you pull out your phone and the connection that happens actually shows that it was geoenced and happened in real life.
1:09:06
So you can see oh this is I just don't have these random followers but I'm actually these are real humans that this person has interacted with.
1:09:13
Then it's a a proof of a heartbeat, a proof of a person behind the scenes, which is going to be more and more important long term as these agents are just manipulating us and acting like they're actually our best friend. >> Yeah. Yeah.
1:09:23
I've noticed >> you're saying like effectively you could have a social graph that was based on like actual real world proximity.
1:09:32
>> Well, I think it's a gradient of trust.
1:09:33
I think when we when we come to social in the future, you're going to say, who is this other person?
1:09:38
And yes, we'll have our household names that we know that's actually a person behind the scenes there.
1:09:42
But if you're reading a product review on Reddit, like how do you know that that is a person or a bot or something else or somewhere in between, right?
1:09:49
And I think this idea of a gradient of trust where you say, "Okay, I know this is a human because they've had this in this many inerson interactions."
1:09:57
And if they're talking about, let's just say an aura ring, they can do a uh what's called a ZK proof or a product at a station where they can say, "I actually have owned this for the last five five years and I can prove it without compromising my privacy."
1:10:09
That type of grad I still I still every every time I see an a comment or a post that's obviously written by AI and I think I identify it and I just scroll past it because it's not you know if it's taking like the average >> like it's take if the if the response is effectively like the average response of everything that Reddit has thought about something and then just turning that into a post.
1:10:40
Like I just I don't want to read it, right?
1:10:42
I want like opinion from real people that have like thought through what they're saying.
1:10:45
Um and but I but I I'm certainly worried about uh you know the boss just like updating their preferences basically with the models and just be like don't use an M dash.
1:10:56
Don't don't say if this then that.
1:10:58
It's not this then that right?
1:10:58
And then suddenly you can't tell >> it that it's real or not.
1:11:01
And >> okay, so both of you, I want you to help square this for me because you have this preference for uh interacting with real humans. That's certainly real.
1:11:08
Uh but you also have um probably I don't think you'll be at the front of the line for to scan your eyeball for worldcoin or something like that.
1:11:18
And so h how like how do you see the the tension between those?
1:11:22
like you want to maintain privacy and all of the all the human human rights that you get online but also be in a bot-free world like what are the possible solutions that either of you see?
1:11:35
>> There's a ton of them out there right now.
1:11:36
Some of them are pretty early days.
1:11:38
I think I think the the ZK proof stuff is really interesting because you don't compromise personal integrity or you have to reveal anything about you.
1:11:43
You can actually use math to prove something and and trust that which is huge.
1:11:47
Um there's obviously, you know, the extreme is kind of KYC or eyeball scanning or things of that nature.
1:11:54
For certain use cases, if you're interacting with your financial advisor, you want that other side to be insanely verified.
1:12:02
>> If someone is recommending a product, I want to know that they've owned it for x number of years.
1:12:05
There's a bunch of So, it is that gradient.
1:12:06
Or if you say, "Hey, listen. I have Crohn's disease."
1:12:10
You want to be able to show up in a subreddit or a forum somewhere and be anonymous, and that's great, too.
1:12:14
So, but we just have to decide when and how to turn on that level of >> understand.
1:12:19
I'm already I'm already thinking about like uh because there's these farms that uh you know agencies that will go to brands and say we're going to we're going to run your Reddit strategy we'll buy.
1:12:30
So, have you owned have you owned the Aura Ring for more than 5 years like we will buy your >> account there'll be another there'll be another level.
1:12:39
>> I do I I do wonder if there's room for new consumer products.
1:12:41
new consumer products. I was I was uh you know if you shoot uh even digital photos there's the ability to add a cryptographic signature into those photos and maybe that would be a way to prove some sort of humanity without having it be such a reflection of yourself and your in your personal
1:12:57
identity but it's more like okay this person's been taking photos that have been cryptographically proved to be taken with this camera and uploaded so we know that they're not AI and they've been doing it for a long time so that there's some sort of like account level trust that happens I really want that to happen. I think there's a huge problem
1:13:11
I think there's a huge problem here where you know I love Google. I love the AI.
1:13:15
They're bolting it on to everything and I'm like some of the things I look and I'm watching the demos like do we really like there's a they're like oh there's a gate in the background of your family home.
1:13:24
Erase the gate so it looks more like a hedge in the background.
1:13:27
I'm like okay the kids that look at that photo two decades from now be like didn't we have a gate there?
1:13:32
Like how did that disappear?
1:13:32
No, I had I had a weird thing.
1:13:36
>> I had I had something with uh my kids where >> uh our nanny like took a real video of the backyard and then like used AI to put a have a dragon fly into the backyard and then was showing the video to the >> to my kids and I you got to tell them like this is not like three and a half. >> Yeah.
1:13:54
They're not gonna understand. >> Yeah.
1:13:55
So you can say like this is not real but they're like I'm seeing it with my own eyes. How is it not real?
1:13:59
How is it how could it not be real?
1:14:00
it how could it not be real? I really I really try and ground this in like like you saw an AI picture of me but this is like Disney, this is like Bluey or this is like Pixar and because like like even the four-year-old understands that like the cartoon is not real and if you see
1:14:16
it on screen and I do I there is that bull case where once once anything can be fake you assume everything is fake and then you just and then I've been thinking of the value of books written before 2021 right totally where if there's there's already this nostalgia for the past. Think about with with
1:14:32
Think about with with books, knowing that the writer, like I don't care if you used a quill or a typewriter or a computer to write it, but there's some element to knowing that like, >> you know, uh thousands of hours were poured into, you know, creating this thing and and they were highly intentional about every single word and they they, you know, typed out the letters.
1:14:52
Even if they worked with a ghost writer, it's still like that ghost writer was like spending a lot of time and energy.
1:14:57
And then you can now create a book and basically >> get ready to write boolean before 2021 in every search bar forever.
1:15:06
>> Pinterest is the same way.
1:15:07
>> I bought a domain name human and I never launched it.
1:15:09
But it was one of those things where I thought to myself, okay, I'm going to create a field that doesn't allow you to paste into it.
1:15:14
It watches your keystrokes.
1:15:15
It verifies proof of human and it's just for sending thoughtful letters to other people.
1:15:18
And it would put a little stamp at the bottom letting you know that you actually typed this whole thing out versus just running it through an AI to get something meaningful. >> Yeah.
1:15:26
Have you uh have seen the like the the the crisis in in in wedding speeches now where like every wedding speech is just like >> so I I I recently went to a wedding and and I was playing this game with every all my friends who were driving down to the wedding and I was like okay let's play some bets.
1:15:42
How many weddings will mention AI either in the positive or negative?
1:15:46
Like just so you know I didn't use AI and then how many of them will sheepishly acknowledge that yeah I use chat GPT for this.
1:15:52
So, we're all placing bets and we're like, "Okay, we think three on average will mention AI.
1:15:56
Two will sheepishly admit AI."
1:15:58
And there were no speeches at the entire wedding.
1:16:03
The whole wedding, they were just like, "Yeah, we're just not doing speeches."
1:16:05
So, there were just no speeches and it was awesome.
1:16:06
It was just dancing and partying and like and they they they did vows, but they didn't.
1:16:10
>> There's somebody somebody out there that's doing a wedding speech.
1:16:11
They're like, you know, a little nervous.
1:16:13
So, they're reading off piece of paper and they go, "Uh, blah blah blah m dash."
1:16:20
>> Just like themselves this wedding.
1:16:20
>> Just like themselves this wedding. What are you what are you um how how are you processing the uh the browser wars which which to me right now is seems more like uh you know uh a group of people throwing stones at the Chrome castle you
1:16:36
know just kind of in there glancing off right and and so we'll see if if any of them get traction but uh how how have you been kind of processing >> uh I I've played with them all I do appreciate how there's finally innovation coming to the browser I like
1:16:52
how they're it felt initially like some bolt-on technology where it was like they're just shoving AI in here for the sake of AI >> sidear >> and now it's fast like OpenAI's browser is performant like it was snappier than I thought you know when I remember when I was at Google many years ago a lot of
1:17:08
the search team obsessed over milliseconds of shaving down the result time to get people to the result that they actually wanted clunking in the early days there on in terms of inference on the AI side but it's getting better uh perplexity Okay. I think OpenAI did a little bit of
1:17:21
I think OpenAI did a little bit of a a better job.
1:17:23
I've I've used Arc for a while and some of those.
1:17:27
>> But knowing knowing what you know about consumer products, >> yes, >> let's say that Atlas is I was estimating it at maybe like it's 1. 1 times better. >> 10% better. >> 10% better.
1:17:39
>> Is that enough to get people to rip out their their current browser?
1:17:40
Because there's some there's some categories where something that's 10% cheaper, it's a commodity.
1:17:46
Everyone will just switch over to buying the cheaper thing.
1:17:49
Inference tokens for B2B SAS, right?
1:17:51
Yeah, but your browser is free today.
1:17:53
>> To get rid of the iPhone, it's got to be 10 times better because I've been dealing with bad speech to text and weird Apple intelligence features and I'm stuck here because you know I have lock in. Yeah.
1:18:04
>> Yeah, iMessage is a great one.
1:18:04
And so, uh, yeah, the question is in the browser, do you think it's like you need to be 10x better or is 2x better enough?
1:18:13
>> That's tricky because as a technologist, I'm naturally drawn to play with these things regardless of whether they're 10x better.
1:18:18
>> I was like, I'm going to switch. >> Yeah, but you're not.
1:18:19
But you're rational and that you're not that doesn't if if something's 10% better and you kind of know that it's 10% better, it doesn't necessarily mean like, oh, I'm going to switch over all my workflows and >> Yeah.
1:18:31
>> I just >> it's there's like this like activation energy. >> Yeah.
1:18:35
There's there for the average consumer, they're not thinking about what browser they have.
1:18:38
Like really truly, they're not.
1:18:40
They're like on their Windows machine and launching whatever the default is there.
1:18:43
A lot of people use Safari still. >> People use Edge. >> People use Edge.
1:18:48
>> People use Edge. So there isn't there is a group of people here that will say this is I remember when Firefox first started getting off the ground and and there was some massive incumbents IE and others out that were out there and there's this grassroots effort from technologist say this is better it's more secure it's faster all these things and eventually got enough adoption to
1:19:06
where it didn't it never took over market share but it was double digits of adoption and I think that's what we'll see with some of the AI and it's table stakes they have so much capital why do they care they just want to have this as a way to gain more market share and it's more things that they can deploy that are slightly defensible that give them an edge over other AI companies. >> Yeah. Uh I have a question that I like >> Yeah.
1:19:24
Uh I have a question that I like to ask people that worked on a lot of different projects.
1:19:28
What's one project throughout your career or life that you feel is underrated? It's like your baby.
1:19:35
It didn't get enough attention.
1:19:35
maybe, you know, didn't play out the way you wanted, but you still love it and uh and want We asked Gabe Why from uh Mischief this and he told us this wild story about uh doing a ship of Thesius thing with a sink in the MoMA or something like that. It was crazy.
1:19:50
But are there any projects that you think like, okay, if I could if I could get hop in the time machine, go back to this particular date and run this particular strategy again, that's the moment that I'd want to like dig into again. >> Yeah.
1:20:03
Well, I we we had a a product called Pounce that was a competitor to Twitter way back in the day and that had probably uh an additional seven or eight features that are now just built into Twitter. Sure.
1:20:16
>> And a lot of uh there was other there was other um kind of competitors at launch that were more business focused and I think if we would have gone that direction it have been a massive product.
1:20:25
The one that I would say was the the the funniest in my uh kind of product building experience over the years was back in 2005, early 2005.
1:20:36
>> I created for the first time the ability to vote down comments and have them auto collapse in. >> Oh.
1:20:41
>> And so they would just show the top line. Yeah.
1:20:43
>> And so we wrote it back on that software that if it had five down votes, it would auto collapse a comment in.
1:20:47
No one had done this before and it's fine.
1:20:48
Someone would have figured out how to do it, but we launched it first.
1:20:52
This was before Reddit had it and it came out and we thought there was a massive bug because we we went to the story and it had 200 negative like 220 some negative votes on it.
1:21:02
I'm like that's impossible because it collapses after five.
1:21:03
And so we did a bunch of debugging.
1:21:06
We found out that actually what people love is to expand a shitty comment, look at it and be like, "Yeah, that guy is an ass."
1:21:13
And then and then bury it down again.
1:21:15
And we had never discovered that human behavior would lead us in that direction.
1:21:19
And we're like, "Oh, people love >> they love to hate people. They love the dunk."
1:21:24
So that was like the first time I'm like, "Oh, the internet's horrible."
1:21:27
So, >> how are you how are you processing the fact there's like three or four direct Twitter competitors now that seem large and scaled and sustainable?
1:21:35
I remember the >> What are the threads threads?
1:21:41
>> But is Blue Sky I would love to know Masedon and Blue Sky like actual >> Blue Sky around 30 million activives a month or something like that now. >> Yeah.
1:21:48
But but decline is it declining?
1:21:50
>> No, I think it's working.
1:21:50
The main thing is like I remember uh there was someone who launched like a paid Twitter at one point that was going to be all like API driven.
1:21:59
There were a number of folks who were thinking about like the next version and maybe we maybe it goes back to that uh they were only 10% better and in fact getting into your ideological echo chamber whatever that is is is a 10x better experience.
1:22:11
But how have you been processing this?
1:22:13
The the fragmentation of like how short form the answer isn't just add more features.
1:22:20
It's like something about the community.
1:22:22
>> Well, I I listen I think we're entering into a world of personal software.
1:22:23
I think this idea of vibe coding is going to be taken more and more seriously every single month that goes on.
1:22:29
I like that >> there is a right now as someone that studed two years of CS and then couldn't wrap my ADHD around head around all of it.
1:22:38
I dropped out, but I'm a a proficient kind of senior coder right now with cursor. Yeah.
1:22:42
And six months from now, I'm just going to be able to do anything I want.
1:22:46
And then the average consumer will be able to do anything they want, kind of Wix or like, you know, Squarespace styles for websites, what they did for websites in a year or so from now.
1:22:55
>> So, if we're going to have personal software all over the place, you're going to see millions and millions of more apps and products that hit the market.
1:23:01
It's a it's a actually a a beautiful thing in that the entrepreneur will have more control over their destiny than they ever had before.
1:23:06
They won't need to raise venture capital or they'll do it at much higher valuations because they'll have product market fit first.
1:23:13
So VCs are screwed which is actually awesome >> because it's putting the power back into the creator's hands.
1:23:18
And I think we're going to see all of these little microcosms, these little tiny sectors of very personal, intimate, human-driven conversation that may or may not bridge together via decentralized infrastructure that ties all the connective tissue alla master mastadon or or a blue sky or something that is like piping it all together. We'll see.
1:23:38
But I believe there's going to be a lot of value mining that because if you go to a subreddit that's like Japanese woodworking with several thousand people, you don't it doesn't need to be 10 million people.
1:23:47
It just needs to be a thousand that deeply care about a topic to extract value from that topic.
1:23:52
And the more of that gets built and gets launched and creates these smaller communities, I think it the better it's going to be for the world because we will have real information created by real users sharing very intimate things with each other. >> Yeah.
1:24:05
>> Yeah. Do you think that's just like the the long tale of software innovation just kind of arises and so in that woodworking you know sub subreddit or community they'll have their own app and they're shared between them and even though there might only be a few people that are actually coming with the the ideas or identifying the problems to solve once they build it they can
1:24:24
actually build it for a low TAM and still >> the other thesis that I have is that companies that historically would never hire an engineer will hire an engineer and the example is like Tyler here who builds a bunch of software that we use to run the show and like the TAM on the software is like one like we are we are the only company in the world that needs the software that we have. You could never
1:24:45
You could never sell this as a SAS company but for us it makes sense to hire somebody who can build this cuz we built you'll see like we run the show off of this so the whole team can follow along like where we are in the show.
1:24:56
No other you know maybe a handful of companies in the world could like kind of get value out of this but it's so purpose-built for what we need.
1:25:03
We also built like an ad platform that like tracks everything for our partners and again like never would have there's not really a market for that.
1:25:12
Uh and so I think you'll see a lot of companies that are like okay like we're not a software company but we can just build our own software uh for in categories like we still use a lot of SAS right and so and we get a lot of value out of it and we're not going to like build our own version of of linear right or CRM. No, no, maybe.
1:25:32
But I think it's going to be much more purpose-built for very specific niches and then we'll still be pulling the the the the products that exist.
1:25:42
It's like we're only using software for completely net new problems that are low TAM.
1:25:47
>> Well, or just something that didn't quite fit your mold.
1:25:48
Like if you had Salesforce and you're like, "Oh, we customize the crap out of it."
1:25:52
It's still going to be customized Salesforce.
1:25:55
It won't be your own thing.
1:25:55
And now you have the ability just to build your own thing and in like a day, which is crazy.
1:26:01
Yeah, the the the thing that we've seen uh that with vibe the state of vibe coding today is like you can build the the v1 extremely fast then the actual maintenance is like a real like is is uh ends up being like if it takes you >> 10 hours to build it might take you hundreds of hours over
1:26:19
>> I think that problem is going to be solved very soon I had uh I interviewed the CEO of Verscell u recently yeah Grim was great and he was talking about this idea of vibe check which is just like an agent that is deployed to check your code and actually go in and fix bugs and actually get it to scale. And the the
1:26:32
And the the beautiful thing about engineering is these are all they're not subjective realities like they all have problems that are defined that have an answer.
1:26:43
The bug the the bug should go away.
1:26:43
The code should scale like so we can solve this you know it's not like finding the next cancer drug or something a little bit more obscure. Yeah.
1:26:51
bit more obscure. Yeah. where where uh if VCs are screwed uh maybe not today but in the in the future where >> where are you most excited to invest and what do you think the role of today and what do you think the role of a a VC
1:27:04
actually looks like in a decade >> yeah so I mean I wear two hats I'm a partner over at True Ventures we we're we're managing a little over four billion so we have a lot of companies I think VCs are um they they are very much needed >> yeah exactly but here we go all right I got one. >> There it is. >> There it is. >> $4 billion. >> I love it.
1:27:24
I was wondering if I was going to get one today. This is fantastic. Thank you. >> Takes one big number.
1:27:29
>> So, uh, one big number. So, four billion.
1:27:30
Um, but the the companies that need our funding more than anything else right now are hardware companies because they have they actually have to bring a product to market. They have the tooling.
1:27:39
They have all the prototypes.
1:27:41
They there's a lot to put and and we, you know, we've done we did Ring and uh uh Fitbit and Pelaton and all these great companies.
1:27:48
And we saw it was hundreds of millions of dollars to get these companies off the ground and to scale.
1:27:52
>> Now on the software side, it's different.
1:27:54
It's different because I can we can see Vibe coders creating these things getting to their first 100,000 or 500,000 users never raising any capital >> getting revenue and now guess what that valuation jumped up from a $10 million pre to a 50 to a 75 or whatever it may be or they don't raise capital at all which is great.
1:28:11
have that lifestyle business.
1:28:13
Bring in 20 million in ARR SF mayoral candidate that is focused on freezing seed valuations. >> There you go.
1:28:22
>> It's like the Zoron but for Zoron the Zoron of SF.
1:28:26
It just says like the first round you raise has to be at a 10 cap or less.
1:28:31
>> On the hardware side, how are you thinking about AI wearables, AI devices?
1:28:35
There's been we're in this kind of like primordial explosion.
1:28:37
Lots of big players working on stuff, lots of existing players.
1:28:40
I mean, Apple has a massive portfolio, but what do you think?
1:28:43
>> AI wearables are insanely creepy.
1:28:43
I think if you uh feel like you should punch someone in the face for having something on, you probably shouldn't invest in that company.
1:28:51
>> The the idea that something is always listening 24/7 just breaks down so many social uh contracts that we have in place today with other humans.
1:28:59
Um, there are some that I have seen that have not launched yet that are really trying to figure out how to navigate that space in a thoughtful way that preserves privacy but also gives you the extended functionality of having a second set of ears for what you're doing.
1:29:14
And I think those are yet to launch and they're going to be really cool.
1:29:18
>> Yeah, it's it's interesting that a lot of the or at least some or at least one uh AI wearable is saying it has to be always on.
1:29:26
you actually can't turn it off because there's no friendship that you have in life outside of yourself that is like an always on friendship, right?
1:29:34
Like I don't have perfect information parody with my wife and that's part of like our relationship to catch up at the end of the day and that's okay.
1:29:41
that's okay. Like there's nothing that says it has to be on like it is a very clear product decision to say and I think some of the ones coming down the pipeline will be like you can tap you can pro you know trigger it to come on and and interact with it and then turn
1:29:56
it off so that you're not >> what about less of like the wearable space and more of like just traditional consumer electronics that could either uh kind of like add AI features on and actually see acceleration uh versus completely new formats like in you know
1:30:13
are you seeing pictures for like picture frames or or or you know new new like the next generation ring that you wear or something that's not necessarily this wearable that's always on talking to you but just there's a new problem that you can solve but you need a hardware to instantiate it
1:30:30
>> absolutely I I think that we're in the early innings of this um especially when it comes to personalized health and a bunch of other things you know I was on I was on the board of Aura for several years and I was there >> incredible business too >> yeah it's wild the numbers. >> Fantastic. I've been insanely thrilled >> Fantastic.
1:30:42
I've been insanely thrilled at the growth that company's seen.
1:30:44
And I remember >> that was such a good example of a business that was like it from my view was like focused on biohackers which small Reddit audience type thing.
1:30:52
It was like I was around in college, you know, looking up like what obscure things can I take that aren't illegal that will make me crush it on this test.
1:31:02
And yeah, there was a period where they were just working with like small health podcast.
1:31:07
>> This is this this is what I did there.
1:31:09
So basically my job with Harpit, the CEO at the time was to go in and basic he said go find me all the different biohackers.
1:31:18
So you know Peter Tia was on there like all Yeah.
1:31:20
Ben Greenfield, Tim Ferris, like Dave like all of them.
1:31:25
>> We would go and figure out can they invest?
1:31:28
Do they want to be advisers?
1:31:28
Can we get them a ring and this was making that jump from Gen One to Gen two hardware made it a lot smaller.
1:31:32
And then we worked with Matt Walker from the Berkeley Sleep Lab to get his algorithms on there to really have the best in class sleep algorithms and that was a a huge game changer.
1:31:41
But a lot of AI functionality will be coming to these devices to better understand things like blood pressure and a whole slew of other things that will eventually be able to plug in including uh your genetic polymorphisms that come in from your genome to really understand who you are as a unique individual versus just a blanket for everyone. >> Yep.
1:31:58
Rank these three buckets that we've been talking to.
1:32:00
We talked to uh early stage founders who are uh green field project and they have AI tools and they can build a company that's AI native versus uh growth stage companies maybe they're at a billion dollar unicorn already.
1:32:14
They're still in founder mode might be a little tired but AI is re-energizing them and they're able to layer on AI.
1:32:20
They're not like what is this AI thing?
1:32:22
They're aware they used Chad GBT the day it came out.
1:32:26
>> And then there are the public companies.
1:32:28
Maybe they have a professional CEO and they have to go through a real business model transition.
1:32:33
>> How do you see each bucket fairing?
1:32:34
Where are you most excited?
1:32:36
>> It really comes down to the leadership at the senior level.
1:32:38
Like if your if your seuite has a lightweight I like chat GPT vibe, you're not deep enough, right?
1:32:45
And so it's I but I you know what happened with with all these tech companies where they are really reducing staff to come in and say okay this next generation is less heads more specialized and the more of the orchestrator of the AI >> um versus uh just these massive payrolls and we can do more with less.
1:33:05
I think you see that with startups now where the products that they're building and shipping.
1:33:10
I I met with a startup the other day where they judge themselves based on what they call uh tokens in flight.
1:33:17
>> So they set their AI in like yolo mode and then they go to lunch and they're like how many tokens can we put into flight while we're sitting where we're having lunch and we come back and look at the results. >> Okay. Yeah. They just fire off.
1:33:27
>> This is the new metric for how they they judge productivity.
1:33:29
It's like how many of these they can fire up?
1:33:31
How many chat windows can they fire up at a time to go code on their >> We do that.
1:33:35
We've done over a thousand interviews this year.
1:33:36
Obviously some were more prepped than others.
1:33:38
I've definitely been like, "All right, I got 15 minutes.
1:33:42
Let me fire up fire up a deep research while I get dressed."
1:33:46
>> Yeah, >> that's great. Uh, well, it's 12:30.
1:33:48
Uh, we have to move on and talk >> this was super fun.
1:33:53
What uh anything that we missed that uh that that you're excited about or wanted to mention while you're here?
1:33:58
No, I I think this next six to eight months, especially with Gemini 3 coming out that drops and a couple of the models I hear that are being floated around hinted about coming up.
1:34:07
We are engineering is unfortunately for the last, you know, 20 years when people say where do I go? What do I study?
1:34:14
You know, a young person would come up to me and like what's the future look like?
1:34:17
I was always say to them CS like computer science.
1:34:21
No, no, no doubt in my mind.
1:34:23
>> That's not the case anymore. >> You don't think so? >> No, it's just not.
1:34:26
>> Coding is a solved problem.
1:34:26
We just don't know it yet and it will be in the next few months.
1:34:30
And I know everyone's like bugs scale. Yes. Yes. Yes.
1:34:32
Those are great problems to have.
1:34:36
>> But is it not still worth >> studying computers if you love computers?
1:34:41
>> I think you should have a light technical understanding of what's possible to know where to bend and break and sand down the rough edges.
1:34:46
You're going to need that.
1:34:48
But I think it's a different course altogether.
1:34:49
A lot more focus on creativity than it is actually in >> design and and and the structure of like what is the business problem that you're solving. That is important.
1:34:57
I I still lean that uh the best vibe coder is a coder is a is a programmer.
1:35:02
Someone with deep expertise will be able to >> I think that's a designer in the future though.
1:35:07
>> But yes, yeah, maybe it's a designer in the future for sure.
1:35:10
>> Uh certainly depends on what you're building.
1:35:11
Well, uh very exciting and thank you so much for coming by. >> Thanks for having me. Come by again soon. >> It's been an honor. >> Uh thanks so much.
1:35:16
We will talk to you soon and we will move on to our pre-recorded interview with Jeff from Hyperlid.
1:35:22
Uh Jeff is >> one of the most impressive entrepreneurs >> at the moment >> in the world right now.
1:35:28
I think there will be books >> written about Jeff and I'm excited for you guys to hear this interview.
1:35:34
We tried to get some of the history of Hyperlid, how it how it got started, why it got started, and then also towards the end of the interview, we get into uh a bunch of different questions uh that we that we uh that we gathered from uh some of our more onchain friends to get an idea of where Hyperlid is going in the next 6 to 12 months.
1:35:54
So, >> so before we play this, let me tell you about numeralhq. com. Sales tax on autopilot.
1:35:59
Spend less than 5 minutes per month on sales tax compliance.
1:36:00
and I will kick it over to the production team to play our interview with Jeff from Welcome to the show.
1:36:08
Thank you so much for joining us.
1:36:09
Um, our audience here already has a soundboard by the way, so do not let that uh, you know, you go alert. >> Yes. Yes. Yes.
1:36:17
Um but uh I would love to get the introduction um from you for our audience which is technative but maybe a little bit less cryptonative.
1:36:26
And so if you could just kind of break down a little bit of like how you're describing yourself, your journey, your business at a high level and then we can go into a bunch of different directions. >> Sure.
1:36:39
So maybe starting it might make sense to start with a bit of an origin story. So >> we'd love that.
1:36:42
Um yeah so I guess mid 2022 um we were a small team doing trading in crypto and we're looking at DeFi and CFI and had already kind of a sense that we wanted to build something in DeFi because of the very nent nature of the product at that time.
1:37:00
basically all the products were kind of bad and uh uh we were traders and we felt like we we could make it better and the basically the the sort of impetus for going all in and building Hyperloop was was when FTX collapsed.
1:37:14
It felt like suddenly the the previously very academic concerns in crypto around decentralization and self- custody.
1:37:21
It felt like people wrote about it but didn't really care and all of a sudden it was very viscerally important.
1:37:26
it was very viscerally important. uh you know it's like not your keys not your coins and uh we had strayed very far from the original ethos of um Satoshi and Bitcoin and so um yeah we thought we thought like >> the world was ready for to really like trade trade crypto in the way it it it's
1:37:43
meant to be which is like peer-to-peer in a in a self-codial decentralized place and so I guess fast forward to this day Hyperlid is I think the primary onchain venue for price discovery um it's it's a fully onchain financial system and so our kind of motto always is we want to build something that can ultimately house all finance. And so
1:37:59
And so happy to go into that more later, but >> um yeah, it's a blockchain.
1:38:03
It's not just not just an exchange, but the I guess it's best known as uh the place where people trade perpetuals on chain.
1:38:13
It does more than a billion dollars in revenue a year and it it kind of has been the first in many ways.
1:38:19
And so happy to also get into like what's interesting about it.
1:38:22
It's it's fascinating to hear you saying like it most founders that come on say like we but it's clear that you see yourself as more of like a custodian of this thing that you're building and releasing is is that the correct frame of mind is that how you think about this? >> Yeah.
1:38:40
So I think we we took a lot of inspiration from Satoshi.
1:38:41
I think he or you know that whoever whoever built Bitcoin >> they not sure but Satoshi we'll just say Satoshi uh >> was very unique.
1:38:52
I think Bitcoin was the first in so many ways, but what one of one of the main ways in which it was the first was that it was it's not a it's not a product like you said.
1:39:00
It's not it's not a top- down company. It's it's a protocol.
1:39:03
And >> I think DeFi and crypto in general like a lot of it's kind of it was inspired obviously everything comes from Bitcoin and there will never be another Bitcoin.
1:39:12
But >> I think >> there's been a lot of kind of like top down like web to >> totally standard type approaches in crypto like if you look at centralized exchanges that's another great example.
1:39:21
They're very good businesses, but they're like mega corporations.
1:39:22
They're >> yeah, >> they're not very like cryptonative in that sense.
1:39:26
And so >> we we take a lot of inspiration from from Satoshi.
1:39:29
And so we Hyperlood really is uh what we think like credibly neutral protocol which will ultimately be the rails that kind of all the finance kind of upgrades their tech stack to use. >> Yeah.
1:39:40
So no VCs is at least the lore. Uh can you unpack that?
1:39:44
Is that just because like you're so capital efficient you don't need to raise or is there some sort of particular philosophy around the role of venture capital in crypto?
1:39:53
Um how how are you thinking about that equation?
1:40:00
>> Um so it it really does go back to Satoshi again.
1:40:02
Satoshi again. I think the Bitcoin would not be Bitcoin if he had raised uh series A even if best investors in the world you know sickest cap table ever still still would I I would say that would not Bitcoin would not be Bitcoin
1:40:16
and so the >> I think I think VC's actually provide a really important service to the world they allocate capital efficiently they help a lot of things would like the world would not be >> not always >> yeah as a whole I think they've done
1:40:29
more good than than harm I think >> I would definitely agree with And uh in this particular case I think when you're when when the thing being built is a a neutral protocol on which >> on which something important as
1:40:42
important as money like ought to live and transact I think it's the neutrality is more important than everything and I think the there's a path dependence to that right like if if there are insiders from day one it doesn't matter how much
1:40:53
dispersion of supply mind share talent etc there is the the sort of like the big bang moment will always be there and will always sort of like a scar on the record of the thing and like this doesn't this doesn't matter for almost
1:41:06
anything that is being built and I think raising capital and hyperscaling is is a very valuable strategy but I think when you're building something that needs to be >> incredibly neutral in the long term and the history matters I think we'd rather
1:41:17
go slow and do it right than >> but wait so I want to stay on this like uh h like you can't keep VCs from just building a position in a public token right and so is it more about like the vibe around like insiders Because what if like a big tier one firm was just like we want a 20% stake and we're going to buy the token on the free market and build a position and it's going to feel and perform just like any other asset in our portfolio. Um is has Um is has that happened?
1:41:47
Would that be irrational?
1:41:49
Is there something where like legally they can't do it because of the fund structure?
1:41:52
Like >> be very expensive. >> Yeah.
1:41:55
But I mean VCs don't shy away from expensive deals.
1:41:59
Like we see it all the time. >> Yeah.
1:42:02
But you can make that argument for Bitcoin as well, right?
1:42:03
Like they're very big holders of Bitcoin.
1:42:04
And I think a lot of VCs were very early.
1:42:06
Maybe not a lot, but I know I know several VCs were very early and own a lot of it.
1:42:09
So I don't think it's it's not about who owns it.
1:42:17
It's about the the genesis and the origin.
1:42:20
It's it's more of a principle. >> Yeah.
1:42:21
Like it's >> you can't pre you can't on the one hand preach that this is going to be a platform that is neutral that like anyone can come and build on and on on another hand say like oh but like these people had a chance to build first.
1:42:35
>> Y >> um it's it's not perfect there will never be another Bitcoin like >> sure >> there there is a practical matter to it which is that >> you know like >> anything after Bitcoin needs to launch in a like very competitive >> market there needs to be innovation and something needs to fund that etc.
1:42:49
But to the extent that we can approximate the the ideals of of Satoshi, I think it's still worth striving for. >> No, no.
1:42:57
>> How much did you know exactly what you wanted to build and then just executed against that plan versus iterate to get where you are today?
1:43:06
>> Um I would say very little.
1:43:06
So, so the story there is we we just wanted to come and do something that we could do well and even doing one thing well is very very hard.
1:43:16
So we were we were laser focused at first.
1:43:17
focused at first. We just kind of looked around and thought like we kind of we weren't afraid to dream big but we were kind of practical about We just thought like okay like what's one really really big thing in crypto that we think could benefit from a fully permissionless platform and per trading was the obvious
1:43:34
one I think it was probably doing more than 50% of the revenue in all of crypto back then sort of back of the envelope calculations >> and so we tackled that initially and I think we we one big thing is like we weren't willing to compromise even at the very beginning on how the thing ought to work. So you didn't you you you
1:43:53
So you didn't you you you learned uh the things not to do from FTX.
1:43:57
Uh you learn you were inspired by Satoshi.
1:44:00
Was there any company uh offchain >> uh that that was particularly inspiring? >> Yeah, a bunch.
1:44:09
I mean I think every big company, every big tech company I think is like uh very inspirational >> to me.
1:44:16
Uh I I I grew up in the Bay Area so it's it's it's hard to not kind of be sort of motivated by that.
1:44:22
I think Amazon was a really big one that >> what inspired me was that they they basically like their their very first principles and like driven but al and also very practical.
1:44:34
And I think when sort of I I assume it was Bezos but maybe someone else in the or realized that they had built so much of the internet stack that they it would be a shame if they if that just went to this like retail business like why not sort of abstract it a bit and create the right API so that anyone can leverage this like amazing infrastructure they've built and you know that kind of being the birth of AWS and cloud computing.
1:44:57
I think that's like such an amazing story and that's inspired.
1:45:01
I think like that's kind of like how we think of Hyperlquid was that like it started as you know a blockchain optimized just to be able to do on train purpose trading because no other infrastructure could do that. >> Yeah.
1:45:13
>> Yeah. and sort of realizing at some point that a lot of other things in finance ultimately all of finance we think can benefit from this high performance decentralized ledger and >> yeah so I I like liquid infrastructure
1:45:28
like for liquidity is one way to think about like what >> what do you think about Bezos's backs uh background at de Shaw he was a trader uh that probably informs a little bit of the shape of Amazon I imagine versus say Google where they come out of research, PhDs. Uh what what were you working on
1:45:44
Uh what what were you working on beforehand?
1:45:47
Do you feel like you brought a trader mindset into the you know entrepreneurial journey that you went on? >> Yeah.
1:45:56
Not just the product layer. >> Yeah. Yeah. I think so.
1:46:00
Yeah. I think so. I think trading well I don't really know what kind of trading Bezos was doing but at least with more like automated trading I think there's a lot of it it feels a bit like doing physics kind of it's like you do a lot of approximations you don't >> you can't get anything exactly right because markets are are basically
1:46:22
>> there there there's a lot of randomness right there's more there's more noise than there is signal and that that's kind of what makes it beautiful it's like trying to >> sift through the the noise and it's it's very different from like supervised learning setups in AI where you kind of have like in roughly infinite data and >> um it's it's very high quality. So I do
1:46:38
So I do think the real world is like building hyperl has felt kind of like that in the sense that you you often it feels like we we we're actually like not very data driven at all.
1:46:50
It's basically all intuition.
1:46:51
It's just like we just think really hard about how the world should be and we just try to do the best thing there.
1:46:56
We'll obviously like adapt to data.
1:46:58
Like if something happens and it's like >> obviously bad like we will we we aren't like delusional and we'll like incorporate it readily but we won't like go out of our way to try to create data where it doesn't make sense to uh if that makes sense.
1:47:12
So like AB testing is like something that we just kind of like never do.
1:47:15
>> Oh yeah, that's funny.
1:47:15
Uh you you've mentioned it a few times but uh can we just get uh like a firm backstory definition on pers uh for our audience? Why? What what are they?
1:47:26
Why are they so exciting? >> Yeah. Um let's see.
1:47:32
So for for someone who really has no finance like you you want like a sort of very very like from zero explanation. >> Yeah. Yeah. That'd be great. >> Okay.
1:47:41
So if you think about what is traded today by people that are kind of like you can trade the like thing itself which is like an Amazon stock, right? >> Yeah.
1:47:52
Um, if you want some sort of like leverage, which is to say like make more bang for your buck, then the two ways people go about doing it is one they trade futures, which are these are traded mostly on indices.
1:48:04
So the big like the S&P 500. >> Yep.
1:48:07
And these things basically say like two people put up cash and they just agree to pay each kind of like um they kind of like a long and a short kind of create a contract and then if moves by $1, then the long side say makes $20 and the short side loses $20. >> That's a future.
1:48:23
And then they're they're often also settled in some like underlying thing.
1:48:26
So, it's like we're trading on uh the like what the price of S&P is 3 months from now or like 3 months from now like you'll deliver one cow. >> Yeah. Yeah. Yeah. Yeah.
1:48:38
I think of it as like the the seabbot like if I'm trading corn futures and I let the contract run out like at some point I have to actually take delivery of all the corn.
1:48:48
But all most of the Wall Street traders have figured out like to never do that.
1:48:51
But you hear about these weird scenarios where it's like, oh, the price of oil was negative, so someone bought it for negative money and then like wound up having to get all this oil and stuff.
1:49:01
Um, but obviously in in a purely financial context, uh, that's not that that's not the outcome.
1:49:06
But, uh, has this just unlocked higher frequency trading, more leverage, uh, a different shape of trader, something more quantitative, something more, uh, algorithmic driven?
1:49:16
Who are the who are the customers or who are the traders and and and why are they excited about the product? >> Yeah.
1:49:24
So, they're excited because so so basically like futures like you said like futures kind of suck because of all these like yeah random things like they're kind of subtle.
1:49:30
Sometimes you don't want to get delivery.
1:49:31
They're like all these weird things.
1:49:32
You have to like keep rolling your position if you want it open.
1:49:36
>> Um so like if you look at Robin Hood for example like that's actually much more popular with retail users than futures are.
1:49:41
Um, and they they they primarily trade options on Robin Hood when >> you know when leverage is concerned.
1:49:45
And options are super cool because it's kind of like a lottery ticket.
1:49:49
You can like as retail, you can buy a lottery ticket and feel really good about it. You're downsize limited.
1:49:54
>> Um, but the the trade-off there is like it's actually really hard to price an option, especially if you're retail and especially if you're using like an app that doesn't give you the information that you need. Yeah.
1:50:03
>> And so you're you're kind of getting fleeced because there's like very complicated um structures. It sounds simple.
1:50:09
It's like a strike price expiry, but uh in practice it's very hard to price.
1:50:13
And so herbs are basically like marrying these two assets into one thing.
1:50:17
So there's you want to trade something you want you want to trade something that's just like the price of the underlying.
1:50:22
You want there to be leverage and you want there to be like one thing that never expires.
1:50:25
And that's what a per is. >> Got it.
1:50:28
>> So let's all the liquidity in the world concentrate on one asset.
1:50:29
concentrate on one asset. So like if you want to if like you look at Bitcoin for example on any one exchange there's like usually one very liquid Bitcoin per and that's the liquid asset forever never expires and like that's where the price discovery happens like billions and billions of dollars will trade on these
1:50:44
bitcoin ps and this actually leads the underlying instrument and it's useful for professionals because they can trade it and it's the most liquid instrument there is uh on bitcoin it's useful for retail because it's a clearly understandable price that you cannot get screwed over on because there's there's only one market and it's extremely liquid. So like buy or sell like the
1:51:01
So like buy or sell like the spread is tiny and um so it's kind of like a win-win for for many many participants.
1:51:08
There are there'll always be participants who want options or who want traditional futures but per by and large are attractive. >> Yeah.
1:51:15
What what are the biggest uh bottlenecks to scaling a network like this?
1:51:20
Um is >> certainly not talent because you've you've reached insane scale.
1:51:24
I'm more thinking about like uh are the tokconomics such that there are people that are setting up whole data centers?
1:51:33
Are there AS6 being built right now to run the network?
1:51:36
Like I I'm familiar with kind of the how Bitcoin went where people were just mining it on their laptop and then it turned into a data center and then it turned like hunt for the cheapest energy possible with the ASIC uh because the algorithm was so stable.
1:51:49
um like what uh what does it actually take to scale a network like this over time and where are you in that scaling curve? >> Yeah.
1:51:59
So, Bitcoin is a bit unique in that I think it's the only major network left that does proof of work.
1:52:02
So, >> AS6 stuff you're mentioning, you know, like all the crazy things like volcanoes, mining bitcoins and stuff like that's all really just >> participating in the consensus mechanism.
1:52:13
the all the other high performance blockchains today that I know of at least are powered by proof of stake which is a much more energy efficient way to do things and it's economic security not like computational security.
1:52:27
>> So on hyperlquid there's not much innovation being done on how the network stays secure.
1:52:32
It's like the it's a relatively solved problem economically which is that basically people people put up the native token like it's very important for the network to have its own token which on Hyperliquid is called hype >> and people put it up and they basically say >> I'm like vouching for the usually it's kind of like delegated.
1:52:50
It's kind of like um you know you vote for your congressman kind of thing.
1:52:53
So it's like you delegate to a validator and the validator says anything I do the stake that is staked to me is at risk.
1:52:58
Um, and you can do some math and then the basically the economics work out such that if like most of the stake in the network is honest then it's fine.
1:53:07
And if you want to acquire enough stake to do something bad on the network where bad here is like the canonical bad thing you can do is like spend the same dollar twice is called like double spending.
1:53:21
Y >> which is basically like like forking the the truth state of the network.
1:53:26
>> Um you need to acquire a lot of stake to do that.
1:53:28
So it's economically inable.
1:53:28
So it's the the security is in the economics not in like you know create creating crazy AS6 and like >> that makes sense. >> Energy.
1:53:39
>> How important is brand to hyperlquid success?
1:53:42
Because I think you have uh I I don't know that you've uh you haven't necessarily focused on brand in the traditional sense of like hiring advertising agencies and you know putting together strategy decks and things like that that that uh I'm sure many of your competitors do.
1:53:57
Um, but you have one of the most powerful brands in the world, which is like when you think of the value of anyone on earth being able to just type Hyperlquid and hit post and and get this like, you know, massive influx of excitement and uh attention.
1:54:10
Uh, it's it's truly remarkable.
1:54:13
But I'm curious like what that, you know, how much that's contributed to uh your success versus, you know, scale and and some of these other product decisions.
1:54:28
Yeah, I think the brand we're very fortunate that the community is so I don't know many adjectives like so so strong, so like tight-knit, so uh you know combative at times, but like just like like I think I think it's very inspiring for us because we we as a team are pretty introverted. We're super small.
1:54:46
We're we're only 11 people and >> we don't have we don't have we have no one working on marketing.
1:54:50
Um and I think we even if we did, we would suck at it.
1:54:55
So it's always been >> the product is the marketing. >> Yeah.
1:55:00
>> It's not the it's not just the product, it's the product and the community I would say in the ecosystem.
1:55:02
And so it kind of there's there there are like many pockets, right?
1:55:06
There are people who are just like on Twitter like like you said kind of like posting.
1:55:08
And I think that's like super cool and uh you know I I love it.
1:55:12
And uh there also people just like you know building on the platform.
1:55:16
I think that's another form of like viral marketing, right?
1:55:19
Like they build products on top of the the protocol that synergize with what it is or like offer something new or like extended in some ways.
1:55:24
And >> um the sort of like pillars of finance on hyperlquid are by and large built by community members.
1:55:31
Uh and we hope that that trend continues like anything that can be built by the community are built by the community.
1:55:38
And I think that just like yeah that kind of decentralized marketing sort of embodying decentralization not just at the technical layer but also at the social layer I think is really important to us.
1:55:50
And I think that's kind of the the brand that Hyperlid has.
1:55:52
It's like, you know, framed negatively, you could say that it's kind of standoffish and maybe we're kind of we're we're too focused on tech and not focused on marketing.
1:56:00
But in this case, I think it it what comes out of it is like something much stronger, which is that people feel ownership in the network in in a way that's not possible with a web 2 company. >> Yeah.
1:56:12
>> Yeah. Is that is that part of why uh you know the the companies that want to eat your lunch are some of the most you know well- capitalized large business you know businesses in finance and yet it seems like you know they're struggling
1:56:27
to to really compete is is is the is the army of people that just want Hyperlid to win like just h how you know how how do you think about that kind of advantage and what are some of the other reasons why your guys' kind of counterpositioning makes it difficult to compete. >> Uh well, we honestly don't think that
1:56:47
>> Uh well, we honestly don't think that much about competition dayto-day.
1:56:49
I think there's just like too much to build and I think you're right.
1:56:56
Yeah, a lot of a lot of people want to do what Hyperlid does or like take market share if you will.
1:57:03
Um and we don't Yeah, we don't really think about what >> You're like I don't think about you at all.
1:57:11
No, no, there's just too much.
1:57:11
There really is just like too much to build.
1:57:14
Like I think the if Hyp succeeds in the good case, it's it's something that doesn't exist yet in the world. And I think it's hard.
1:57:20
It's easy to get bogged down by people trying to kind of chip away at something that Hyperlid has already built or whatever.
1:57:26
And I think that's like it's >> it's a bit stressful sometimes, but also it kind of detracts from the big picture, which is like we're still so far away from where we we need to be. >> Yeah.
1:57:36
>> How big can Hyperlid get?
1:57:40
like what's your ambition?
1:57:42
>> I think of it as in the good case basically finance as a whole which when I say finance I mean like the coordination of human behavior.
1:57:52
>> That's not it's not like it's not like >> you're like you're basically saying like if if I don't uh assume you know 100% of the global TAM of finance I will have failed. >> That's amazing.
1:58:04
>> Well no I mean you ask how big it could get. >> Yeah. No good. I like it. It's true. Yeah. Yeah.
1:58:09
But but I I don't think it's like an it's coming in and kind of like displacing finance.
1:58:13
It's really like >> in my mind it's sort of like the internet did to find sort of like like electronic trading happened in early 2000s.
1:58:20
It's been like >> more than 20 years.
1:58:21
It's >> about time the tech stack gets updated and I think DeFi is kind of >> is that tech stack. >> Okay.
1:58:28
I have a lightning round for you.
1:58:31
Uh asked a bunch of uh cryptonative friends uh what they wanted to ask you.
1:58:35
So, I'll go through a bunch of them and hopefully you can answer quickly since some of them are are uh pretty specific.
1:58:41
Uh when do you expect to see the first centralized exchange shut down their per decks and simply run a front end on top of hype uh through HIP 3?
1:58:52
>> Um >> when will they when will they capitulate? One year. Okay. Okay. >> We'll track it.
1:58:58
Uh any specific views on the market structure bill in the US and under what circumstances would you bring hyperlquid onshore?
1:59:09
>> That's a good question.
1:59:09
So we we we think the US is a super important market obviously it's like the financial center of the world and the dollar is the reserve currency capital >> Yeah. Yeah.
1:59:17
I mean we we would nothing more than uh love nothing more than to sort of like have regulation in the US sort of evolve to to sort of really embrace DeFi and I think strides are being made in that direction.
1:59:30
>> I I can't comment on the bill specifically just because I I feel like I'm a little ignorant on it.
1:59:33
It's I feel like it's changing a lot and >> honestly like I think there are really smart people working on it and the things I've heard such as like you know carveouts for decentralized front ends and things like that I think are like really cool. >> Yeah. >> Um yeah.
1:59:44
Why do some centralized exchanges uh say that hype doesn't want to get listed? >> Uh do they say that? I don't know. >> I don't know.
1:59:58
>> No, we don't have a want here.
1:59:58
I think it's like a >> we're building we're building.
2:00:02
I think the you know exchanges several exchanges have listed hype and I think it's cool and other ones you know for other exchanges it doesn't align with their priorities and I think that's also cool. Yeah.
2:00:12
We're not we're very like ar we just like don't really talk of these. Yeah, >> institutions.
2:00:17
>> Uh, any plans to enable multiasset margin natively?
2:00:24
>> I think it will happen and I don't exactly know the path to where that happens.
2:00:29
So, uh, it could be built like natively is a bit like not well defined here, but I think it will happen.
2:00:33
I think you know if it's going to house all the finance surely you should be able to use different types of collateral to trade. Makes >> sense.
2:00:40
when pers on commodities and US equities.
2:00:46
>> There are already some pers on.
2:00:46
So there there are gold ps uh tokenized gold and there I think the answer to when is probably in the next year because HIPP3 I think is unlocking a lot of this.
2:00:58
So basically letting it lets anyone kind of come and deploy their own.
2:01:03
>> What do you think is most misunderstood about Hyperlid today?
2:01:09
Oh man, there's so many things. Uh most misunderstood.
2:01:15
>> One thing I would say is that it's well the it is a network.
2:01:17
I think people think it's like a purpose exchange.
2:01:18
Some people think it's like a centralized thing. It's really not. It's a blockchain.
2:01:22
The validator says permission list.
2:01:23
They're currently 24 validators.
2:01:25
You know, anyone can spin one up.
2:01:26
It's like top top 24 by stake.
2:01:29
Uh the the validator set, you know, every validator executes every transaction including all the orders.
2:01:34
So like like this kind of like base layer of like just like what it is I think is kind of lost because people are so they're they're focused on the product basically which which maybe is good.
2:01:44
Maybe it's nice that the tech is abstracted from users. >> Do you miss the bay?
2:01:51
>> Um I miss some things about it. Yeah. >> What do you miss? >> Um what do I miss?
2:01:59
I miss I miss Chick-fil-A. Let's go. That's a great one.
2:02:07
>> That's a great answer.
2:02:08
>> That's a great answer. >> I love it.
2:02:10
>> I miss I miss mountains actually.
2:02:10
I mean, that's not like literally in the bay, but like Singapore is very flat.
2:02:14
So, it's it's a very nice place.
2:02:14
It's a great place to build, but >> uh I miss kind of like Yoseite and that kind of vibe, you know, Pacific Northwest.
2:02:22
>> When I was in Singapore, uh a lot of people I interacted with said that Singapore doesn't have like a strong local culture.
2:02:29
And maybe that's just because it's small or maybe that's uh because it doesn't have like an underground like punk scene because of different rules and regulations.
2:02:37
Do you feel like you found uh like a great community in Singapore?
2:02:43
Do you feel like you found a great culture there?
2:02:44
Do you like the where the where the country is going like culturally?
2:02:51
>> Uh I'm honestly a bit too busy to >> just locked in. Okay. >> No. Yeah.
2:02:56
It's a great place to build.
2:02:56
I think it's it's super safe. It's very modern. >> Yep. >> You know, good food. >> Yep.
2:03:03
>> Air conditioning, like that kind of stuff.
2:03:05
So, uh >> I'm honestly not a c at this point in my uh trajectory.
2:03:10
I'm not really attuned to the culture.
2:03:13
I feel like if I were in New York City, it would be kind of wasted on me. >> Totally. Totally. Yeah. Yeah. Yeah.
2:03:18
You're not looking for like the underground art collective that will define the Yeah.
2:03:21
You're you're you're locked in. It's great. Love it.
2:03:24
>> What What is the specific framework you use for building the team?
2:03:27
because I imagine the level of talent that is trying to join you know the the core team today is is insane.
2:03:36
Uh but clearly you have some kind of framework for it otherwise you would have just been you know 100 >> thousand people by now.
2:03:49
>> Well I think we actually are like just not very good at recruiting.
2:03:52
So I will say that here we are recruiting. We're always recruiting.
2:03:55
Um, we're looking I know there a lot of super smart listeners >> uh on this on this >> um >> podcast show >> and we would love we would love for you guys if someone's interested in you know like systems engineering like high performance >> um building the rails of the future of finance.
2:04:14
I I really think this is like there's no better place to work and uh would love for you guys to join.
2:04:18
I we we're a super small team of 11 people.
2:04:21
The the bar is very high.
2:04:21
I do think it might be one of the highest bars.
2:04:24
Um I think we are one of the most efficient organizations, engineering organizations that I know of and >> that has ever that has ever existed. >> Could I say that?
2:04:38
>> I can say I feel like I can say that.
2:04:39
>> I think you might be right. Yep. It sounds right.
2:04:41
But but but we are trying to grow and I think it's uh you know it's yeah it's it's uh there's a there's a lot to build and um yeah we just we we just have a very high bar in many in many directions like you know competence also just like integrity I think we we just care a lot about many things and uh you know if if someone listening meets all those bars we'd love we'd love for you to join us.
2:05:08
Is it is it uh in person only or do you guys have remote teammates?
2:05:15
>> Uh new for for new recruits we're we're trying to do in person only.
2:05:20
>> Um there yeah initially it was it was remote when we found that it doesn't work super well with our work style. >> Last question.
2:05:28
Are people that uh that brag about doing 996 soft?
2:05:35
>> Well, this is the like 9 to9 six days a week thing. Yeah. >> Yeah.
2:05:40
>> Uh >> cuz I imagine you're doing quite a bit more than that.
2:05:45
>> So that feels like part of the part of the criteria is like somebody comes in, they're like, "Jeff, like I like I'm your guy. I'm I'm 996."
2:05:50
And you're like, "Sorry, like >> that's not >> We don't do half days here. >> Yeah.
2:05:58
>> I mean, it's I I do think it's uh it the quality of work is the most important thing."
2:06:02
So I think different people, you know, burn out at different points and that is, you know, obviously the most important.
2:06:06
I personally work more than that, but it's because I feel like I don't really have a cap >> like personally, but you know, everyone's >> Yeah, makes no sense.
2:06:15
Well, thank you so much for taking really enjoyed this.
2:06:18
Thank you for uh fantastic sharing the origin, explaining per for our audience and uh yeah, really just incredibly impressed with with what you've built and excited to follow, you know, continue to follow your journey over the next uh years and uh decades. >> Congratulations. We'll talk to you soon. really appreciate it. Thanks for having me on. >> Have a good one. >> Bye.
2:06:40
>> And that concludes our recorded interview with Jeff from Hyperlquid. I hope you enjoyed that.
2:06:43
Uh if you're new here, please subscribe to the show.
2:06:47
Leave us five stars on Apple Podcast, Spotify.
2:06:49
Uh we have more crypto coverage later in the show.
2:06:52
We're talking Chad in one word. >> Yes, >> Jeff. >> Jeff for sure. Uh also Finn.
2:06:56
ai, the number one AI agent for customer service, number one in performance benchmarks, number one in competitive bayoffs, number one in ranking on G2.
2:07:05
Our next guest is already in the reream waiting room.
2:07:07
We're gonna bring him into the TBPN Ultra Dome.
2:07:08
Tomas, how are you doing? Good to see you again.
2:07:11
It's been too long to be back.
2:07:14
>> Thanks so much for hopping back on.
2:07:14
Uh you've been lighting up the internet with a bunch of uh hotish takes.
2:07:18
Uh a lot of takes I agree with, but mostly just very thoroughly researched takes.
2:07:26
Uh and so >> not something you see a lot.
2:07:28
>> Not something you see every day.
2:07:28
So I I'm very I'm very excited to have you on the show.
2:07:31
uh would love to uh just kick it off with taking your temperature on on where you think it's the most important to focus right now. What is the narrative?
2:07:41
Is it these uh complicated structures and the vendor financing?
2:07:45
Is it the overall bubble narrative broadly progress on uh token generation or DAUs?
2:07:52
Like where are you spending your time focusing?
2:07:56
>> Yeah, we're trying to understand what's really happening, right?
2:07:58
So we wrote this blog post about Nvidia and the 110 billion of vendor financing.
2:08:01
I mean I ran the numbers for uh an event the data center buildout is now greater than 1% of US GDP.
2:08:09
And we had made this prediction in 23 >> that AI would generate contribute more than 1% or contribute at least 1% to GDP.
2:08:16
And I was stunned that we're basically already there.
2:08:18
Uh and so we we had this question of how similar LPs will ask investors will ask us how similar is the current environment to say 2000 when you had pretty large network infrastructure buildouts and I was kind of in high school during the time but I remember these companies like Lucent and Nortell and them going to the moon and then collapsing >> and so we ran this analysis and so we're paying attention to a lot of different things.
2:08:43
We're paying attention like on the on the bull side.
2:08:45
We're paying attention to token generation, right?
2:08:50
Google has released now three data points and we can start to track at the growth rate there is slowing.
2:08:54
>> Is the growth rate slowing because user demand is slowing?
2:08:56
I don't think that's the case, but maybe there's far pretty significant improvements in overall efficiency.
2:09:02
The other thing that we're spending uh paying a lot of attention to is just understanding the debt structures, the use of SPVS on and off balance sheet vendor financing.
2:09:09
Um and so and then the last is the depreciation schedule.
2:09:14
So a lot of these data center companies have extended the depreciation schedules almost doubling it.
2:09:19
>> Amazon went from 3 years to six years and then backed off to five earlier in 2025.
2:09:23
And that's important because it's the collateral that's underwriting these loans. >> Yeah.
2:09:27
Uh let's start with the vendor financing. Yeah.
2:09:29
It is notable that uh everyone was so hopeful that AI would would in increase GDP growth >> and it did >> and it did but it came at the cost of hundreds of billions of capex. >> Yeah. Yeah.
2:09:44
Um yeah it I want to start with the uh with with the vendor financing because that's uh ringing a lot of alarm bells.
2:09:50
A lot of people are going to Lucen story.
2:09:52
I took it in a different direction and I was wondering if you're familiar with the ASML customer co-investment program because in in 2012 TSMC, Intel, and Samsung, they pitched in 6.
2:10:05
8 billion across R&D funding and equity purchases in order to help ASML pull forward EUV lithography and 450 millimeter wafer technology.
2:10:13
And the it was this like odd round trip, but it worked out.
2:10:19
And so when when when somebody throws me like the vendor financing is immediately red flag, I I always want to say like, well, it doesn't always end in disaster.
2:10:28
And so how much nuance should we be placing on the vendor financing stuff?
2:10:33
How much do we need to be digging in to actually understand what's at risk here?
2:10:39
>> So vendor financing itself is really common, right?
2:10:41
You pointed to this ASML example.
2:10:43
It's a wonderful thing within the ecosystem.
2:10:45
And the vendor financing fails when you have a closed system and they're all borrowing and lending from each other and there's no net new GDP coming into the system. >> Yep. >> Right.
2:10:59
And then it just goes around and around.
2:11:00
Everybody takes their tax and GDP goes to zero, which is kind of what happened. And that's not the case. Right.
2:11:06
You look at what I mean the revenue growth of Open AI.
2:11:09
You look at the enterprise spending that's happening.
2:11:12
There's GDP that's coming from labor spend.
2:11:13
There's GDP that's coming from BO operations that have been executed in foreign countries that are now basically being reonshored.
2:11:21
And so I I don't like I think it would be >> too simplistic just to say vendor financing uh we're I'm calling the top.
2:11:34
That's not the case at all.
2:11:34
It's just the expectations around 500 billion a year in capex and the return on invested capital and the depreciation schedule.
2:11:41
I think the thing that we're the the bigger question is how would the bond holders make out >> Yep. >> on all this, right?
2:11:49
Do you have >> where does the risk actually live?
2:11:53
Because I feel like there's this world where uh you have open AI is kind of rolling a 20sided dice and as long as they don't come up with a one, they're going to be fine while everyone else is flipping a coin and it's 50/50 whether they make it out. Okay.
2:12:04
and and everyone's everyone's playing the same risk game, but the risk is just way higher for some of the folks who are further out in the debt curve in the capital stack, more risk on, more debt laden.
2:12:17
And a lot of a lot of the narrative is like OpenAI is taking on all this debt.
2:12:21
It doesn't actually feel like they're taking on that much debt.
2:12:24
It feels like their partners might be.
2:12:26
>> Yeah, that's exactly right.
2:12:26
So, I don't I don't think OpenAI is really taking a lot a lot of balance sheet risk.
2:12:29
I think I think it's the it's the lenders who are taking the balance sheet risk on.
2:12:35
And >> so why is there some reason to be concerned with G?
2:12:37
Google ran an analysis on their GPUs in their data centers.
2:12:41
They found failure rates at 50 to 70% utilization were significantly higher after 3 years which is half of the amortization or depreciation schedule.
2:12:50
>> Then you have next generation chip architectures.
2:12:52
SGI just announced yesterday Cornell research that showed 90% improvement relative to GPUs with a new chip architecture and then a second generation that's promising 100x performance improvement from there.
2:13:03
And so fundamentally underpinning all this is how fast are tokens growing which is an inflationary force in the ecosystem and then the deflationary force are algorithmic improvements and chip improvements and so what is the net you know what is the vector that comes out of that? What is the slope?
2:13:19
We don't know the answer but uh it seems like both are growing very very fast and so it's hard to predict.
2:13:26
>> Do you think there's like much more confidence from on the inside or do you think that uh internally some of the dealmakers are uh actually viewing hey this is a leap of faith but we're all taking a leap of faith or do you think that when they when they hear us yapping about them on a podcast they think uh these guys don't know the data they don't know how how solid of a bet this is?
2:13:49
I bet if you're in the inside of one of these companies, I mean, Google and Microsoft both said in separate earnings announcements this year that they were hardware constrained >> and you just watch the consumer adoption.
2:14:00
I think OpenAI will reach like a billion in MAU here faster than anything.
2:14:04
And so I think if you're on the inside, >> there's very little reason to worry because you see the ultimate demand.
2:14:09
We were, you know, first wave of all this AI was just better search compressing all of human knowledge into an LLM.
2:14:15
And now we're at this >> tool calling or agentic phase where it will actually start to do work for us and it works pretty well some of the time. Yeah.
2:14:25
>> Um, but if we can improve that meaningfully, then the demand for token will go tokens will go through the roof.
2:14:30
>> Um, I have another question.
2:14:30
Uh uh I'm trying to understand how people feel about the ramp of agentic commerce because in the limit if I think about a billion mauus who people are purchasing things they're using chatbt regularly they're just going to wind up buying things and taking even a 1% cut of that commerce through an affiliate revenue or a stripe like tax or some sort of ad auction to see Will will you buy it on Walmart or Etsy or Amazon or somewhere else?
2:15:04
Like just just even even not just surfacing like a direct advertisement for something you're not shopping for.
2:15:11
Um that feels like that could be very lucrative on an ARPU basis.
2:15:15
Uh but I'm wondering how long it will take to that for that pattern to actually manifest if people aren't in the habit of searching because over the past two years it's been yeah maybe you'll chat something but then you have the natural flow of like oh then I go to Google to order it or then I open Amazon to order it.
2:15:33
So how do you think about that ramp?
2:15:36
>> Well super exciting time.
2:15:36
>> Well super exciting time. You've had the ad market historically dominated over the last 15 years by Google and >> uh and meta right 250 billion on search about 265 billion on social and so it's been really hard candidly to invest in the advertising ecosystem but now it's wide open >> I think >> the agentic commerce is is uh will be have pretty significant tailwinds here
2:15:59
because you are in the flow you are researching I mean I don't know about you guys but like the number of websites that I visit compared to say 5 years ago has fallen off a cliff because I' instead of going through all the forums to figure out what is the bike the best bike >> carrier for the family I just ask and then great send me the Amazon link and I'll buy it. >> Yep. >> Yep.
2:16:16
>> So maybe there's an ads model here.
2:16:16
You know we had we had kind of contemplated whether OpenAI or others would run a keyword auction to inject ads into the context window.
2:16:25
So that's the additional information in addition to the search query. >> Sure.
2:16:29
Um, you know, one of the crazy theories that I've been wondering about is I was chatting with a friend who suggested, well, what if OpenAI takes a 30% cut, not a 1% cut, but what what if it looks like the Apple >> If you ask if you ask a retail brand, what percentage of Meta what what how much of your revenue does Meta take? It's probably like 30%. >> Yeah. >> Yeah. >> And if the Yeah.
2:16:49
And if the performance is better, then merchants and retailers will pay it. >> Yeah.
2:16:53
How do you think about uh direct agentic commerce affiliate?
2:16:56
like I'm searching for the best bike rack.
2:16:59
It gives me a bunch of options and then at the last second it runs an auction to see what, you know, provider will actually send that to me and they take a cut there versus I'm searching for history of the Roman Empire, but it knows that I'm interested in shopping for a bike.
2:17:15
And so in the middle of that feed while I'm reading a deep research report about Rome, it says, "Hey, do you want to check out what that bike you were looking at earlier?"
2:17:23
Because the Instagram flow, yes, there are people that search for camping gear and they scroll and there might be an ad that matches up, but a lot of times you're just looking at family photos from friends and it says, "Oh, here's the thing that we know you want and you might buy it, >> right?"
2:17:38
So, those are two different kinds of ads, right?
2:17:40
So, you have ads, let's say, within the search and then >> the finding an artic or targeting an ad to you about a bike rack when you're reading about the Roman Empire is called retargeting. Yeah.
2:17:50
>> And it's t typically done from search.
2:17:51
Hugely successful advertising program. I think both exist. Yeah.
2:17:55
>> And you typ it it depends on how considered the purchase is.
2:17:58
So everybody has a different level of willingness to spend before they say consult their spouse or >> take some time to think about it.
2:18:06
And so you have these impulse buys and then you have I think retargeting works very very well for considered transactions like a car.
2:18:13
If you're really interested in the next electric car coming from Rivian, well the ad at that point is actually pretty useful for you.
2:18:18
Uh and one of the things that we I learned in the advertising business was seven impressions was kind of the key to building a brand.
2:18:25
So there there is value in both the brand building component, the retargeting component as well as the immediate transaction part of an ad unit.
2:18:32
of an ad unit. Do you have an idea of I I mean if we're just out if we're just to to play out sort of like a median case for like a bubble popping you might map uh you might map open AI to Google you might map uh anthropic to Amazon companies that made it through the com
2:18:50
bubble maybe there's some you know overbuilding that happens and you get elucent and you get some big companies left in the wreckage but what is advice to you know if you're talking to a dot entrepreneur who raised you know, $50 million, doesn't quite have product market fit, it's 1999. You now know that
2:19:05
You now know that the bubble's about to pop.
2:19:09
What advice are you giving a founder that, hey, it's raining right now.
2:19:14
It's everything's really great, but it might not be that way forever.
2:19:18
How are you setting up your business for uh durability in potentially a rocky time? >> Great question.
2:19:25
First, it's to bolster the balance sheet.
2:19:26
And I know this goes a bit against the grain of don't raise too much capital, but I think what we learned in 21 is the companies that had pretty significant balance sheets were the ones that were able to reinvent themselves and weather the storm either by acquisition or new product.
2:19:38
And so I think the cost of capital is incredibly low.
2:19:43
So you should be shopping for capital if you can.
2:19:45
And then the second thing is I think there's this notion that product market fit is this binary condition that once you pass the gate, >> you're done. Mh.
2:19:56
>> Um, and that's it's no longer the case.
2:19:59
Product market fit is this is this status that you need to it's like a United miles you need to continue to fly >> to maintain 1K.
2:20:06
Um, and so and we saw it between 21 and 24 companies that were classic software companies literally overnight lost their product market fit. >> Yeah.
2:20:17
And that's that'll be very much the case again if >> do you think the labs have an incentive to get various players to overbuild?
2:20:22
So then they there's like a basically like yeah they could they can they're we're a buyer they're basically a buyer at any price right because they're GPU constrained now but if you can collectively get people to overbuild then two years from now you might have dramatically lower costs.
2:20:39
And I think you're already seeing this in some cases where like actual GPU prices are through the roof, but then the leasing prices are quite a bit lower.
2:20:49
>> But I'm curious if you think that uh kind of playing out the game theory there.
2:20:53
>> Yeah, I mean I think so there's, you know, I think if they want long-term relationships with their capital partners, they will probably want to game it a little bit, but maybe not too much.
2:21:03
Yeah, >> they definitely want to see a little bit of excess. And that's okay.
2:21:06
You look at the CPU spot versus contract markets and those there's excess CPUs on AWS and Google and the margin structures there are really good.
2:21:16
I think one major question with the GPU market is you really within the large hyperscalers you do see great utilization and there's a question around the neoclouds of what utilization are they seeing and what the United economics are there but overall I I think they probably won't look to burn uh others just because they need these relationships for 20 to 30 years. >> Yeah.
2:21:38
Uh Oracle is down 17% in the last 30 days.
2:21:43
30 days. uh do you think that will hinder their ability to actually deliver the capacity that OpenAI is saying just in the sense of like you know they were raising debt and a lot of people are saying like they're basically properly leveraged maybe shouldn't go much more
2:22:01
from here uh but I'm curious like do they just need to go to the 20 20 you know 2040 forecast you know 20 2050 just just keep moving >> RPO out to the end of the century why not >> why Uh yeah, I think I mean it's it's a good business, right? It produces a lot
2:22:16
It produces a lot of cash.
2:22:17
The information article around um the 10% roughly gross margin structure on some of these contracts I think is what catalyzed that drop in price.
2:22:27
>> And so >> yeah, but it but I but it did it did drop dramatically and then it's just been chugging downhill >> down. Yeah. >> Yeah.
2:22:35
Yeah, I mean, look, these are big long-term contracts with unclear demand and the demand is growing really fast.
2:22:41
And so, I think if you're an investor, a long-term investor, you have to be >> hedging at some point. >> Yeah.
2:22:47
There's also a lot of like hype that comes out when there's like a new biggest number, everyone is like, "Oh, I I didn't even know that they were in the game, and now they're at the top of the game with the biggest number."
2:22:56
And those people pile in and then they might get, you know, jitters.
2:22:59
Like the whole detail of that margin was the the nuance there was that well of course you pay for the GPUs before you start making money from them because you that's like any manufacturing process you buy the raw materials before you make the widgets.
2:23:15
Um but you know people obviously saw a lot of jitters in that >> did the totally yeah go for it.
2:23:18
Oh, I was gonna say I think there's this great parallel.
2:23:22
I don't know if you guys read the book Barbarians at the Gate, which was >> about the LBO of Bu RJR Nabiscoco and it was the great it was the largest buyout at the time >> fueled by the junk bond wave for Milkin, right?
2:23:34
And um >> and then that kind of >> one, it created the LBO asset class in a very real way, but two, it was a big contraction.
2:23:42
And so I wonder is will we have a Barbarians at the Gate book written about some of these major data center contracts? really hope so.
2:23:49
There are so many OpenAI books coming out and I know that they're all just going to focus on like the doomers versus the >> nonprofits for Yeah.
2:23:56
And it's going to be intriguing and stuff and it'll be like social network vibes, but uh I want I want uh I want like an Andrew Sorcin uh book about this more than the salacious like journalist take of like OpenAI is bad for whatever reason. >> Yeah. The business history. >> Exactly. The in the room. Yeah.
2:24:14
I I I read uh the Caesar's Palace heist.
2:24:16
read uh the Caesar's Palace heist. I don't know if you've read that about uh Apollo and it's just like the most nitty-gritty on like the debt restructuring that it's another LBO of the casino empire and it's just like super fascinating to me pretty low tam but I hope we get one of those books
2:24:32
just about because some of the novel deal structures that happened at openi every single turn even going back to the the Microsoft deal for a billion dollars of credit >> we're actually going to reinvent we're going to reinvent the wheel >> they reinvented the wheel 12 times it's not just the the the nonprofit and the for-profit it's way more complicated. Every deal is like units and crazy and
2:24:49
Every deal is like units and crazy and then now these deals.
2:24:51
Uh it's all a lot of fun.
2:24:54
>> Did think about like the Google ownership in Anthropic and then the Amazon ownership of Anthropic and what does that mean when you have two strategics each owning 10 plus?
2:25:01
>> That's why when when the Google uh news was was hitting the timeline yesterday and that they're working on some type of major deal.
2:25:08
I was like why are you surprised that a double digit percentage stakeholder is like working on a deal? >> Yeah.
2:25:14
like with with their portfolio companies.
2:25:17
Like that is like the obvious thing.
2:25:19
>> That's like famously bad advice though.
2:25:20
Like if you're if you're a startup, it's usually like don't let uh don't let a strategic build a 10% position in your company unless you're actually planning to sell from them because it will preclude you from working with the other potential strategic buyers or investors.
2:25:34
And that just hasn't proven true in this market at all.
2:25:36
It's completely different.
2:25:37
>> Uh did anything about the Carpathy interview uh update your kind of worldview?
2:25:41
I I thought it was just very pragmatic and real and and uh you know the the decade of agents point was uh like I think what everybody's experiencing that's like trying agents and talking to people.
2:25:56
There's some that are great.
2:25:57
There's some great coding agents. We have deep research. That's awesome.
2:26:00
But uh yeah, we need there's clearly going to need more time needed to to figure out a lot of these uh use cases.
2:26:07
But uh I'm curious what stood out to you.
2:26:10
Yeah, I think reinforcement learning was kind of the, you know, song of the summer and um there are two different approaches.
2:26:17
different approaches. one is uh human labor creating virtual environments or gyms where AI can train to understand how to update your CRM and then there you know standard operating procedure-based >> textbased uh we call them context databases and there are two those are two approaches we've we've written an
2:26:36
article I think the first one on the topic about context databases and so we definitely agree with him there that the current approach of creating uh these gyms uh mirrors the finetuning of the previous area And what I mean by that is if you take a regular model and fine-tune it and customize it to a particular task, it's really brittle. By
2:26:51
By the time the model updates or the tasks update, you have 30 to 50% of the prompts breaking, which is what we experience today in tool calling.
2:26:59
And so I think he's he's largely right.
2:27:02
The amount of research that's happening within reinforcement learning, which has two parts.
2:27:09
The first is making a plan, and then the second is creating what are called reward functions.
2:27:12
like Mario gets 500 points for eating a mushroom or how many points does a robot get for filling out your CRM.
2:27:19
The first one we can do with AI.
2:27:21
The second one is largely still research.
2:27:23
And the amount of work or just like academic brain power that's going behind there is enormous.
2:27:28
So I I really hope that we make strides faster than what he said.
2:27:33
And I mean I'll tell you like I was trying to replicate cloud code myself with open source technology because the plain internet wasn't working very well yesterday.
2:27:42
And I realized I realized like when you use cloud code or cursor it's tool calling is just asking the model one question and then taking the answer and then putting it back into the model and then again and again and again.
2:27:54
again and again and again. And there are different loops like Gemini or yeah Gemini CLI says do that 10 times and then here are the success like that's that's that's tool calling it's extremely basic >> and there's some management of like okay after the first step this is what we
2:28:10
learn now go do this but it's um I thought it was much more sophisticated it's and it's quite like it's uh it's very rudimentary and just the way that like we've optimized memory around these models and we can do tasks and uh Well, we we can hit different benchmarks for science and math. I think we'll start to
2:28:27
I think we'll start to see that with RL.
2:28:29
Although I I think the big question is do we need a new architecture in order to really solve some of these problems and maybe that's what Karpathy was alluding to, but uh we have a long ways to go.
2:28:40
>> Well, thank you so much for coming on the show.
2:28:42
This is always a great time.
2:28:43
>> Let's grab more time next time. >> We'll talk soon.
2:28:45
>> Bunch more questions, but thanks for coming.
2:28:47
>> Have a good rest of your day.
2:28:47
Uh our next guest is already in the ream waiting room, but first let me tell you about Adio customer relationship magic.
2:28:54
Adio is the AI native CRM that builds, scales, and grows your company to the next to the next level.
2:28:57
We have Sean from Coinbase coming back into the TB Pan Ultra. Sean, how are you doing?
2:29:04
>> Hey guys, good to see you again.
2:29:05
>> Good to see you again, too.
2:29:05
Uh, take us through the news.
2:29:07
Would love to go deeper on the acquisition.
2:29:09
Uh, but also I just want to get an update on anything else that's happening in the Coinbase universe.
2:29:16
>> Yeah, well, we're super pumped yesterday to announce the acquisition of Echko, which is the leading onchain capital formation platform.
2:29:21
We obviously we had a little bit of fun with it on Twitter and meet up on Monday even despite all the AWS uh outages that were giving us uh a little bit of the sweats.
2:29:32
Um and >> is that the first time an NFT has been taken through like a corporate M&A process?
2:29:39
>> Yeah, definitely unprecedented.
2:29:39
I mean >> a little bit easier.
2:29:42
You can imagine the uh the trying to explain that to our lawyers and tax consultants uh when you're buying a company like wait you want to also do an NFT thing.
2:29:52
So >> uh yeah I think it was unique and of one thing it was uh you know obviously very specific to this acquisition given the founder of Ekko is Jordan Fish Kobe who uh you know I think he's very much intertwined with crypto lore and upon only is very much intertwined with crypto lore.
2:30:11
So, we just thought it would be a cool creative way to get the crypto community really jazzed up and excited because everybody's been raving about and uh asking for him to bring Up Only back.
2:30:24
>> It Yeah, it was I think like the M&A announcement of the year.
2:30:27
It was it was the best executed like build a bunch of intrigue, hype, controversy even in some realms, but then ultimately deliver a really positive story.
2:30:37
It was exactly what you want out of like M&A comms, which is sort of the least sexy thing you could possibly do.
2:30:43
It's usually really boring.
2:30:44
Just a number and, you know, a couple paragraphs on like synergies and like, you know, everyone's like, "Okay, congrats."
2:30:50
Uh, but this one was really well executed.
2:30:52
I want to know more about the vision for I I we were talking to Brian Armstrong about this yesterday.
2:30:57
The vision for the next generation of crypto companies.
2:30:59
They raise money onchain with Echo.
2:31:02
What does their world look like over the next few years as they scale in the Coinbase ecosystem?
2:31:10
What products are they pulling off the shelf?
2:31:12
What are they taking advantage of?
2:31:14
Uh what does the whole like being a Coinbase native business feel like? >> Yeah, good question.
2:31:21
So, uh you know, Coinbase historically has been primarily a secondary exchange uh for when you list a token.
2:31:27
That's where price discovery happens and that's where uh you know, most of the trading activity is.
2:31:32
But by the time a uh issuer actually issues that token, it's actually pretty late in the life cycle.
2:31:37
So with Echko and then a number another company that we acquired over the summer called liquify, which is sort of like a you could think about like a Carta for crypto companies that helps you manage your token table.
2:31:49
Um, it allows us to have a relationship with the token issuer basically from inception all the way through those private fundraises and uh potentially a public fund raise to listing on the exchange which we think about as sort of like the crypto IPO in some ways.
2:32:06
>> Um, and then after the fact uh we continue to serve that issuer through a business account that uh they can use to manage just sort of the operations of their business.
2:32:15
um they can grow using uh Spindle, which was another acquisition that we did earlier this year, which uh is sort of an onchain ads protocol that helps you find distribution.
2:32:26
Um and I think our broader vision for it >> exactly the legend. >> Yes. >> Yeah.
2:32:34
So, we're we're pulling in all the talent and all the legends into Coinbase. >> Yeah.
2:32:37
Um uh I'm I Brian was talking a little bit about uh bringing access to earlier stage investing to a broader community.
2:32:47
Obviously there's a bunch of uh regulation in the mix.
2:32:49
I I don't really care about the legal understanding.
2:32:53
I want to more know more about the philosophical underpinnings of of who gets exposure to what.
2:32:57
There's a take that's like everyone should be able to invest in anything.
2:33:03
There's also like even though you have to be an accredited investor to invest in a startup, you don't have to be an accredited investor to have money in a pension fund that winds up in a venture capital firm that gave money to a company to a VC firm.
2:33:16
>> I think one interesting thing on Coinbase is like you you can you know exactly like you have you don't know exactly but you have a good sense of who's a qual would be a qualified investor by the assets that they custody on Coinbase.
2:33:30
It's a very natural thing of like knowing like hey these 200,000 people or whatever the number is like have have enough assets just in you know digital assets that they would be qualified as a >> Sure. Sure. Sure. Yeah.
2:33:42
So yeah philosophically what are you thinking?
2:33:45
Yeah, I mean we think that everybody should have the opportunity to invest in these uh uh in these companies.
2:33:48
You know, I think like private companies are have for too long been restricted uh from an access perspective to large venture capitalists and quote unquote accredited investors.
2:34:01
And I think Jordy like assets that you have are one indication potentially of like sophistication or insensitivity to loss.
2:34:10
But uh the perverse side of that equation is it potentially locks a lot of people out from the most compelling investments that uh are out there.
2:34:17
And we want to help people be early basically and give people the shot at being early.
2:34:23
Um and so obviously we you know we need to follow accreditation uh uh rules as they stand.
2:34:28
U but hopefully those change over time as well.
2:34:31
And with Ekko's infrastructure, you know, anybody can invest in a seed round or a series A round starting with crypto tokens and then even beyond that uh looking at traditional companies as well.
2:34:43
>> How how uh how early do you typically start meeting with you know potential uh acquisition acquisitions like are these I imagine with liquify and and uh echo I know the conversation I'm sure the conversation started like at least a year in advance but uh what does that actually look like?
2:35:00
Uh it's kind of variable.
2:35:02
I think with uh Echko, you know, we had known Jordan and Kobe uh for quite a while and so we we I was chatting with him when he we start he started the company.
2:35:11
Uh but we started to really work a lot more together earlier this year when we actually partnered.
2:35:17
So Ekko has a angelist like product where you could start an investment group and then sponsor investments effectively and syndicate those out.
2:35:25
those out. Uh and so we started an investment group for co under coinbase ventures for the base ecosystem fund where uh investments that we were making we would actually let the community follow along with us and invest in those same companies uh because you know
2:35:41
that's something that we heard a lot of demand for particularly within the base ecosystem um and I think as we started to work together more you know that broader vision of hey we can actually enable internet capital markets and eko you have the infrastructure coinbase has the size, scale, and distribution. So,
2:35:56
So, there's potentially some magic that could happen if you bring those two together.
2:36:01
Those conversations really materialize uh and ultimately, you know, culminated in this week.
2:36:07
>> Well, congratulations.
2:36:07
I'm going to ring the gong. >> Hit that gong.
2:36:13
>> Thank you for stopping. >> Fantastic work.
2:36:14
I'm sure you'll be back on very soon.
2:36:17
>> We will talk to you soon.
2:36:17
Have a great rest of your day.
2:36:20
>> Our next guest is in the reream waiting room.
2:36:21
While we bring in Nick, uh, let me tell you about public.
2:36:24
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2:36:30
And we have Nick from Rivet in the Reream waiting room.
2:36:33
Let's bring him into the TBN Ultradum.
2:36:34
Nick, how are you doing, guys?
2:36:37
>> John, Jordy, great to see you guys both. How are you? >> We're fantastic. Big day.
2:36:39
I I already rang the gong just a few minutes ago. I want to ring it again. What you got for me?
2:36:46
>> Uh, we're uh excited to announce our seat round.
2:36:48
It's a big day for Rivet. How much? >> 5. 1. >> 5. 1.
2:36:54
Uh why the any special meaning to the number or just a 100k flyer came in at the end?
2:37:02
>> You know what's funny is this business is um you know it's self- sustaining.
2:37:07
When you sell a service to a customer, they pay you money.
2:37:09
They typically pay you more than it costs to employ people um at least in aggregate.
2:37:15
>> And um we were really selective about who we chose to work with.
2:37:17
And so we start off really only looking for three or four uh to really give us a buffer to uh invest in a sales team and some more tax partners ahead of next season.
2:37:25
But uh you meet with one great firm, they talk, you know, more people show up.
2:37:29
Uh we were lucky to get to work with Hastax Susa and XYZ for this round.
2:37:33
And so >> uh we're very lucky.
2:37:37
>> What's the uh what's the core pitch for the business right now?
2:37:39
How are you explaining it to new customers?
2:37:42
>> Okay, so I'll give the pitch as a customer.
2:37:43
It's just an amazing service.
2:37:46
I've I've uh I've used Rivet uh over the last couple years and uh so that's that part's easy.
2:37:52
It's like you guys are really dialed like incredibly thoughtful. It's just smooth.
2:37:55
Um and so that part makes sense.
2:37:58
What I want to understand is like the the the pitch to investors.
2:38:02
I'm actually an investor myself.
2:38:04
So uh uh but not biased like the product's truly truly amazing.
2:38:07
But uh but what's the updated pitch to investors since it's been probably a couple years since uh since I participated? >> Yeah.
2:38:17
Um to to customers, we're a tax prep firm, right?
2:38:19
You'd engage with us no differently than Berkeland or Anderson or even Deote.
2:38:24
>> We have 30X big four accountants on the team.
2:38:27
>> That's pretty straightforward.
2:38:27
Um nobody really asks why we raised or what we've built when we sell or when we onboard clients.
2:38:34
Uh when we talk to investors, it's it's oftentimes focused on things that customers don't really care about.
2:38:40
It's what have you built?
2:38:40
You know, why are you building it?
2:38:43
>> The toughest part of building this business is context management.
2:38:49
>> When you hire a person to do a job, the context for what they did, why they did it, why they chose to put, you know, something or, you know, recommend a certain classification is hidden in their head.
2:38:59
and it would be prohibitive for their time to write literally everything down.
2:39:04
And so every tax season as new people join the firm, as people leave the firm, as you know, we get rolled up by some huge PE firm, a lot of the p a lot of the actual work starts from scratch, these larger firms.
2:39:18
And so clients get asked the same questions over and over again because no one remembers anything because no one's worked there for more than six months.
2:39:26
>> And it's deeply painful for customers, right?
2:39:28
and they don't realize why it happens.
2:39:30
They just know it sucks and and it's frustrating and uncomfortable and wait you don't remember my EIN.
2:39:34
I talked to you guys 3 months ago.
2:39:38
>> Um what we've built sits on the back end and so it quietly ingests, saves, tracks, you know, whatever you want to call it.
2:39:45
Um everything that is discussed about and given to us from a client.
2:39:48
And so it's not just emails, it's Zoom calls, it's Slack transcripts, it's text messages they sent us.
2:39:56
And just tracking all of that in one place is a massive problem.
2:40:02
It's a massive, you know, build.
2:40:04
Um, that's what allows us to run this practice at scale efficiently, right?
2:40:08
And it's it's, you know, tax prep isn't just data entry from the W2 to the tax software.
2:40:13
It's it's gathering where the W2 was in the first place.
2:40:15
And so what we've built doesn't really replace the accountants.
2:40:19
just automates the tedious parts of their job.
2:40:21
Remembering everything, organizing all the information wherever it was sent and and making sure it's stored in the right place.
2:40:27
Um, it's it's almost like Microsoft suits and remembers everything. It's always there.
2:40:33
>> It's uh it's it's it's really cool to get to work with if you've been working one of these larger firms for for decades.
2:40:38
>> Have you bought any companies? >> No. No.
2:40:41
Uh well actually yes, we did.
2:40:41
Um we acquired a small AI company called Lobby.
2:40:45
Um, originally we u met Wilson Hobbs, the founder and CEO.
2:40:49
Um, and he was calling for one of our roles and and you know, we were deeply impressed by him and his background.
2:40:57
Um, and as we did the interview process, you know, we learned more about lobby and what he had built there.
2:41:03
It was a um, it was a website. You could go to it.
2:41:04
You could upload documents.
2:41:06
You could um, talk to those documents.
2:41:11
>> Sounds pretty similar to what we're building here, right?
2:41:13
It just needs to be done with tax.
2:41:14
And so as we did the interview process, I said, "Wait a second.
2:41:17
What's happening to the team?
2:41:19
What's um what's happening to the product?"
2:41:20
He says, "You know, not really sure.
2:41:22
We haven't quite figured that out yet."
2:41:23
And I said, 'Well, we should have you join the team. That part's easy.
2:41:24
Um but we should also acquire lobby.
2:41:27
You know, I think I think what you built is deeply special and and we should have it here at the business.
2:41:31
And so, uh Wilson joined the team last year.
2:41:33
It's his one-y year anniversary is actually yesterday. >> Wow.
2:41:37
>> And uh he's since brought on two of his uh former team members. Yeah. One year anniversary. It's exciting. Um >> that's big.
2:41:43
That's big for us, you know.
2:41:45
Um, but you haven't bought any, uh, tax prep firms, I'm sure.
2:41:49
How how many times how many times have people tried to get you to do a roll up?
2:41:56
>> Uh, I think every investor meeting for the first 6 months was, "So, how many firms have you bought?
2:42:00
Why aren't you buying more?
2:42:01
You know, aren't you going to raise $100 million to roll up 50 firms?"
2:42:05
>> Chat's asking what the website is. >> It's rivet. tax. >> Rivet. tax.
2:42:11
Uh, well, congratulations on all the profit.
2:42:15
in 30 seconds since we're tight here, but uh why why have you chosen not to roll up tax, you know, tax prep firms and, you know, make them AI native? >> Yeah, good question.
2:42:26
Um, it's much easier to steal their business than it is to buy them.
2:42:30
The change management of of of rolling up a firm, convincing the people who work there that they'll like us, >> uh, the whole the whole process is deeply difficult.
2:42:40
You can expect to lose about half the customers, half the revenue, half the team when you buy somebody. >> Whoa.
2:42:44
>> Um, >> it's not worth it.
2:42:46
>> It's much easier to just tell people about what we do and uh bring them onto the platform. Much much easier.
2:42:52
>> That makes a ton of sense. >> Love it. >> Well, absolute dog. >> Absolute dog.
2:42:55
Well, thank you so much for stopping by. >> Great to have you on.
2:42:58
>> Uh we we'll talk soon.
2:42:58
Congratulations >> service. We'll talk soon. >> Bye. >> Thanks, guys. >> Cheers.
2:43:03
>> Uh before we bring in our next guest, let me tell you about adquick. com.
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2:43:15
We have David Tish in the recent waiting room. >> Love t. Let's go. >> Let's go. >> Give us the news.
2:43:27
What's new in your world? Did you raise one fund? >> No, two. What? >> Oh, hit that gong. We got two funds. Two new funds. >> Thank you. Let's go. >> Incredible.
2:43:40
We did >> two because two is more than one which was made bigger number better.
2:43:47
>> They made a sequel to one fund.
2:43:47
It's two >> fun and that's important to to do more always, especially in venture. >> Yeah. >> Yeah. Bigger is always better. >> What's the strategy? Put it all in one place.
2:43:59
Massive secondary slug of open AI. What are you thinking?
2:44:03
>> We're we're we literally have no rules.
2:44:06
Our plan is to give people money. Okay.
2:44:09
>> And and pray and >> uh diversify our prayers and >> diversified set of prayers.
2:44:17
>> Uh where are we on the prayer meter?
2:44:19
Should we differentiate this year than last year?
2:44:22
Are we going to be praying a lot more next year? What do you think?
2:44:26
>> Uh you just it's like a balance of stability and increasing at the same time.
2:44:31
So you have to do you never like drop.
2:44:33
you just keep doing more.
2:44:36
>> But we're we're different than other VC firms in that strategy, which is important because we're selling money, which is a commodity. >> Yeah, makes sense. >> I love it.
2:44:45
Uh what what uh besides fundraising, has that just dominated your life the last uh since we last chatted, or are you still >> I'm not a um you are forced to file with the government at a certain date.
2:44:57
So 15 days after you uh it's like taxes but totally unrelated.
2:45:03
Um and so you have to file with the government and so our filing date was yesterday.
2:45:09
So we're forced to uh talk about it and so that's why we did it.
2:45:13
But we uh raised the money earlier in the spring and just closed it and we'll start giving it away uh in the new year which is a a 2026 treat.
2:45:25
What uh uh are are there particular areas that you feel are just like over like over hyperly like overco competitive right now?
2:45:35
Uh all the all like have been picked clean of new ideas categories where you feel like you have enough bets and maybe uh you're you're going to be declining to hear more pitches in a particular category or vertical or horizontal layer of the stack.
2:45:51
Like are you thinking about that at all? >> No. >> Okay. Should we? >> I don't know. >> Um, no.
2:45:59
>> I mean, on this show, we hear like, you know, a million like you you you wind up hearing like AI agents for a million things and then you're just like, okay, I don't want to hear that.
2:46:05
And maybe I mean, we're not even investing.
2:46:07
We're just like I'm kind of bored of talking about that particular niche. >> Yeah.
2:46:11
Look, I think I think at the later stage there's a lot of direct competitors and if you're in the business of picking a later stage company, you pick one and and then you stop.
2:46:22
We're at the very earliest stage and so we're meeting people who have ideas, who have dreams.
2:46:25
And what we've found over the years is is uh you guys know is things change.
2:46:31
And so you might start with an idea you're going to we don't we don't fund intentional pivots, but people iterate.
2:46:37
People get into a market.
2:46:39
They see where there is opening and where there's too much competition and your go to market becomes different.
2:46:46
Your product might become different.
2:46:46
Um, and so I think uh we don't ever close ourselves off to things.
2:46:52
We don't try to fund direct competitors ever.
2:46:53
We think that's uh just just misaligned with the the deal you're making with the founder.
2:47:00
Um, but I think we're open-minded to what we fund and uh where it's coming from.
2:47:05
And I think that in this moment you're seeing sort of everything up for grabs still.
2:47:09
And whether that's within verticals, whether that's in the tech stack, um it doesn't mean, you know, go fund foundational models today, but I think other than that, um we're pretty open-minded.
2:47:20
And then foundational models that are not perfectly horizontal, I think are probably still on the table.
2:47:27
>> Is there a new mafia emerging?
2:47:27
I mean, we've lived through the PayPal mafia.
2:47:32
There was a bunch of entrepreneurs.
2:47:34
>> You guys are sponsored by the mafia, right?
2:47:36
So my main goal with our new funds, we I counted only four of your sponsors that we've invested in.
2:47:41
So Ramp, Privy, Bezel, and Graphite.
2:47:47
>> I would like to get uh >> the full lineup. >> Yeah.
2:47:52
So we're going to take our money, we're going to give it to companies, they're going to give it to you, and and that's uh we call it the new circular economy.
2:48:00
We tried to fund the circular economy. >> Circular economy.
2:48:02
Our audience will buy the SAS >> and run their businesses.
2:48:07
>> I think we just main strategy.
2:48:07
Our LPs were really excited about that strategy. >> Perfect. Perfect. >> Well, thank you.
2:48:14
>> Uh what do you what's your what do you think is your most underrated portfolio company?
2:48:19
>> Oh, that's a good Now I have to pick a f like a >> You basically have to pick a favorite.
2:48:22
No, no, but but but there's companies there's companies that that uh some of my favorite acquisitions are companies that like haven't been in the news for 5 years and they just get acquired for like $800 million and you're like >> we have one of those which is is really cool called ID.
2:48:35
mme which uh he was on banger company. I know I know him. Yeah.
2:48:40
>> He was on Invest like the best after like 12 years.
2:48:42
It's the craziest origin story.
2:48:45
So that's like a a evergreen version of that and then one day they'll they'll like win.
2:48:49
Uh sort of more modern version.
2:48:52
What Rogo is building I think is not getting enough attention.
2:48:54
Um they're I I think Gabe came on if he didn't one day. >> Yeah. Yeah.
2:49:00
Blake Hall, founder and CEO of ID ID.
2:49:02
I was at a conference and he had a whole deck about like the business and he just ripped it up, threw it out like minutes before and just told his life story and everyone was just like this is the best conversation ever cuz he like worked in the military like saved lives.
2:49:17
It was a crazy just like you know this is like elite business leadership.
2:49:22
I have so much respect for him.
2:49:24
>> Do you uh I feel like in some ways it's harder harder to predict the future than ever.
2:49:30
ever. like in 2010 there was like this sense of uh I think we're going to have a bunch more internet companies in 2020 and I feel like there's a general sentiment in the industry of like we can't predict anything after 5 years like we might get you know crazy
2:49:45
acceleration and AI progress and then everything changes right so it's a little bit fuzzy out in the future do you have any sort of uh I reference like uh there there's I I'll botch it but like there's a Bezos quote which is like in the future people will want like cheaper things faster, right? And like I
2:49:59
And like I can I can like build a business on on those like with that with that goal uh for a long long time because do you have anything like that in early like in terms of how you >> do I have a Jeff Bezosworthy quote to share with you today?
2:50:16
>> No, more so like if you're evaluating you're evaluating something as like is it purely like yeah I don't know if this is going to be a market in 10 years but this is amazing.
2:50:25
I think to your point um predicting two years out feels really hard right now.
2:50:30
You're seeing such rapid build iteration from the biggest companies and that includes the new wave of AI native companies, OpenAI, Enthropic, we saw the browser get released.
2:50:41
You're seeing more and more like first principle build technology get released.
2:50:46
At the exact same time, you're seeing like the modernization of Google, of Meta, of Apple, of Amazon in real time and and Microsoft, they feel stronger in many ways uh than they did for a good 5-year period.
2:51:00
So trying to predict 2 years out when all of that's happening in terms of the startup world, I think is really uh difficult.
2:51:08
At the exact same time, when we're investing, we can't do things that we think are shorting the future.
2:51:12
So you have to play for something that is 10 15 years out and not like we think this is going to happen but we can thread a needle for 3 years and build a business.
2:51:25
That's a terrible way to invest and we call that short >> the future. I love that.
2:51:28
That's really really good.
2:51:29
Um so we look at everything as like if everything this founder is saying is right is this interesting big enough to like fascinating to us and that's what an investment is is uh joining a journey.
2:51:44
Um so we try very hard to look at it from you know if if this existed is this right or cool and um not shorting the future such that it's like obvious why this won't exist in uh a reasonable amount of time. >> That makes sense.
2:52:02
>> That makes sense. I think the last time you were on or maybe one of the times you were on we talked about how there used to be there was this golden age of aqua hires where like great teams could sell to Twitter for like $10 million and they hadn't raised much so it was
2:52:16
meaningful outcome for the founders and then they >> now we do aqua quits right that's what we're up to >> yeah the the yeah I mean obviously the the wind surf uh uh thing >> no it was more the like go to Facebook when you're you started a company from that company thing Yeah. Yeah. That Yeah. That whole thing.
2:52:33
But it feels like we maybe are in a new golden age of aqua hires where like I was advising a company uh a founder like last week who launched a product.
2:52:41
It's like was exciting but like clearly doesn't have product market fit yet and he's like you know talented and has a great team.
2:52:48
So he's getting fielded all these offers that will be like not a meaningful outcome for the investors but like you know will be very meaningful for the team.
2:52:55
And it feels like there's more of that right now in this moment when people are like I don't just need to like be AI native.
2:53:00
I need like as much AI native talent as I possibly can, I'll pay a big premium for it. >> Yes.
2:53:07
Um and and that's healthy, right?
2:53:11
The the sort of decade we had of people just staying in long-term like not going anywhere, startups without sort of recirculation of talent, I feel like was a negative moment.
2:53:24
I think the um like if you go back to the origins of of say Facebook or Uber or Airbnb um in that moment there was more aggregation of talent on those early teams than sort of in in the next wave of startups.
2:53:40
What's interesting about this moment in AI and these very significantly funded companies, a lot of the the research labs and people coming out of the foundational models by getting the funding at the scale they're getting and by bringing with them 8 10 20 people from their previous uh company you're actually getting depth of talent that is capable of building something big probably in an easier way than starting from scratch.
2:54:08
And so I think there's a balance to be had, but I do think um depth of talent is probably the most underrated component of a quality startup, right?
2:54:18
Your 50th person on your roster is amazing.
2:54:20
And I think one of the things about RAMP that they've done so magically is this combination of hiring, retaining, uh acquiring, inspiring, let letting people go, bringing them back.
2:54:33
And if you go to like 50, 100, 300th person at ramp, there's just an immense amount of talent from top to bottom.
2:54:40
Um, and that's I think how you build uh sustainable growth that uh you can keep iterating and and launching new and uh interesting products or marketing uh stunts or uh excellent marketing campaigns, right?
2:54:56
And and I think you're seeing that um from a company where you're seeing depth of talent across all the different um departments within within RAMP as an example%. >> Yeah.
2:55:06
Uh chat wants a jersey check. What are we watch? What are we rocking?
2:55:11
>> We're we're wearing the uh New York Rangers hundth 100th year anniversary jersey. It's a baby blue. >> You look fantastic. >> Beautiful.
2:55:20
>> We we haven't won a game at home yet.
2:55:22
And so uh hopefully we're going to bring some luck to us. Well, good luck. Thank you so much.
2:55:28
>> Congratulations, guys.
2:55:28
If you if you know any sponsors who need money, just let me know and we'll take care of that. >> Perfect.
2:55:33
We'll make some introductions. >> Uh, great to see you.
2:55:34
Congrats to the whole team. Cheers. >> Thanks so much.
2:55:38
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2:55:47
Our next guest is Chris Dixon from Andre and Horowitz, >> living legend.
2:55:52
>> Welcome to the show, Chris. Great to see you again.
2:55:54
It's been too long to have you back. Yes.
2:55:56
Uh uh last time you were on, we got to time you up perfectly with Brian Armstrong.
2:56:00
Today we just missed each other by one day, but uh great to have you here and would love to get uh the update from you and how you're framing the current the current crypto era.
2:56:12
It's so it's in many ways linked to the AI boom but somewhat disconnected.
2:56:17
Like how are you thinking about even just framing the conversation and setting the table?
2:56:22
Yeah, so we just put out our state of crypto report today which I think you know had a lot of good data.
2:56:24
Um I think the >> the um good news is I think things are trending very well.
2:56:29
Um I think it's a reflection of smart policy mainly that um that uh you know the genius bill passed which is very important which has helped the sort of stable coin growth.
2:56:39
Um and I think what it shows like what genius shows is is the the dual effect of smart policy which is on the one hand it provides a pathway for innovation.
2:56:48
And so we're seeing not only startups but big companies like Stripe and you know FinTech and Black Rockck, Fidelity and so forth um get involved in the space but it also kind of eliminates a lot of the scams and bad behavior right
2:57:00
so um what we're really hoping for is a kind of similar result with the so-called market structure bill which is being considered by Congress which would which would provide a similar kind of policy framework for the rest of of the crypto market beyond stable coins. So I
2:57:11
So I think that this kind of momentum is reflected in the data that we shared today.
2:57:17
Um, so for example, stablecoin volume is now in the trillions. That's adjusted.
2:57:21
We try to we have an adjusted metric we use which tries to remove a lot of the bots and other kinds of stuff. >> Sure.
2:57:27
>> And very importantly, that's not correlated with trading volume.
2:57:29
So it's uh it seems to be like sort of genuine, you know, people using for payments and treasury management and so forth. So that's a big deal.
2:57:39
Um we're seeing a lot of cool kind of new emerging applications at the at the intersection of areas like crypto and AI in an area called DPIN which is decentralized physical infrastructure which is a way to use kind of crypto to incentivize the build out of telecom and energy networks and so forth.
2:57:54
Um uh you know we're seeing a lot of there's a big movement of so-called real world assets which is to bring like stocks and bonds on chain.
2:58:02
Um a lot of good momentum.
2:58:02
I mean honestly like we had a you know it was a choppy couple of years uh 2022 to 2024 and I think it's we're kind of coming out of that and I'm optimistic but still a long way to go. >> Yeah.
2:58:14
I I always wonder about the value of these like highlevel market KPIs in crypto because there it feels like as soon as we latch on to one we identify one that seems to be tracking well then it gets all thrown off by just a underlying shift in the market.
2:58:29
Like people were tracking like number of Bitcoin wallets for a while and and that like the idea that the next generation will even be aware if they have a wallet because they might own it through an ETF or they might have a wallet that's abstracted away and they're not even aware of it.
2:58:44
And I'm wondering like there's there there's this like sort of like the midw take is like oh the KPI flatlined but the community overall keeps growing and so if you were taking a victory lap in 2023 you missed out on the next wave which looked different and didn't map on to the previous era of KPIs.
2:59:02
And so I'm wondering like is there is there like is there some ground truth that you like zoom out to that's just like the vibes or the people or the talent or something like that?
2:59:10
like how how do you how do you get away from uh this particular KPI is now needs to be deprecated basically.
2:59:17
deprecated basically. Yeah, I mean there are some cap just just to be fair to the KPIs like and I think Darren who is our head of data science and the report is very prof you know like the stable coin volume uncorrelated to trading seems like a real kind of real metric that's more tech metric monthly active users that that's not people that hold
2:59:36
crypto that the number of people hold crypto in the hundreds of millions what we track is people that are actually using these kind of new apps that are on chain >> got it >> that we put between 40 and 70 million there's a error bar there because we have to get rid of bots and other things But uh but it's definitely been growing and that's like monthly active users of apps. So you know it feels like a real
2:59:51
So you know it feels like a real metric uh that's sustainable to your point.
2:59:55
Y >> um yeah but it's a good point a lot of a lot of venture capital and startups is is vibe based right is qualitative.
3:00:03
>> Um and uh you I think it's definitely gets definitely better.
3:00:05
I'm actually at prepping our annual founder summit now and like it just the mood is better.
3:00:11
People are building people are innovating.
3:00:12
You know it feels like offense not defense.
3:00:14
A lot of that's the policy shift.
3:00:16
Um, but >> policy shift is big.
3:00:19
Also, just like I feel like the the the bullcase for bare markets is that it washes out a lot of the tourists and then the technologists stay. >> It does. >> I think that's right. I think that's right.
3:00:30
I mean, I like I've been, you know, obviously doing the internet stuff my whole career and seen many waves.
3:00:32
Um, >> including I, you know, I started my first company in the internet downturn of the 2000s and, you know, there was this kind of um, you know, what is it?
3:00:41
Strong men create weak times meme or whatever. Yeah.
3:00:45
>> Well, I like I like that that crypto as an industry rewards people that have an unwavering vision and are okay with >> with uh you have to have some appetite for failure. Like missionary. >> Yeah. Yeah.
3:01:00
And uh >> so and and I think that's like healthy.
3:01:04
It's like yeah, you have to actually believe in this long term.
3:01:06
You have to be okay with the risk.
3:01:07
You have to be okay with like a total ban scenario in a specific category.
3:01:12
Um my question for you uh prediction markets are having you know massive moment right now and this was something that I'm sure you were writing about more than a decade ago in terms of its potential and a lot of and there were various kind of attempts at prediction markets that never really reached like cultural relevancy and the scale and the way that they've reached today.
3:01:35
Uh what kind of categories do you think people have like thought had potential but kind of rode off?
3:01:40
maybe they were too early but we'll be talking about in like two years.
3:01:44
Is it is it privacy zk proofs?
3:01:47
You know thing things along those lines.
3:01:52
>> No, it's a great question.
3:01:52
If I could just address your prior point about the whole you know sort of sticking with it first.
3:01:57
I have an unwritten blog post that I that I would title investing is a uh emotional test disguised as an intellectual test.
3:02:05
Meaning one of the things I've learned over the years is just like sticking with it in venture capital whether it's crypto sort of more extreme.
3:02:13
I think this is true of public markets if you read like Howard Mars and Warren Buffett but it's definitely true in venture which is a lot of it the business is just sticking with stuff um same with entrepreneurship um when it when it seems you know kind of tough um so you know that's I think it makes a great point to to new emerging areas.
3:02:31
Yeah, look like I think privacy it's interesting like we had a lot of um privacy is a very interesting area now the stable coin bill passed a bunch of folks like in the policy side who were kind of you know kind of I don't know anti- encryption and privacy are now saying wait a second all the stable coin payments are public that's not good what
3:02:46
if you want to do financial transaction healthare like yes we agree that's why we want it we don't want it for obviously for you know illegal activity we want it because that you know people want in normal cases they want privacy for some of the things they do and so we think that's very important we have a bunch of investments there. >> Y
3:03:01
>> Y >> um yeah, prediction markets, great to see them break out now.
3:03:03
As you said, they've been the idea goes back.
3:03:04
I wrote a tweet tweet about it about back to Hayek in the in the ' 50s and you know, DARPA started a prediction market, believe it or not, the government in 2021, I believe. Sorry, 2001. >> Wow. >> Something like that. Um, >> wait. What was everything?
3:03:18
>> Was that just like you know uh uh just for in like intel purposes like >> yeah they wanted to predict like is there going to be a war in Iraq and then they thought okay like it's a little bit distasteful that people are betting on it but the societal benefits would outweigh it.
3:03:34
But then there was such controversy around it that that they um canceled it.
3:03:37
There are now rules as there should be around so-called harmful prediction markets.
3:03:41
Um, and you know, you can't have those.
3:03:43
But the kind of the core argument for prediction markets is that yes, there's sometimes on the one hand it's sort of gambling and betting.
3:03:49
On the other hand, it has a real benefit as we saw for example in the election.
3:03:51
You can get really objective data and in a time in which you know trust institutions seems to be dropping like do you trust you know the newspaper anymore.
3:03:58
Um, it's nice to have an objective source for that.
3:04:01
So but back to your question I think privacy is very interesting.
3:04:05
I think um you know I'm I'm very excited by sort of the intersection of like AI and crypto as an example.
3:04:12
>> My experience in tech is that often like if you think back 15 years ago people talked about mobile, social, cloud was like the three buzzwords >> and they and and some people saw them as kind of different categories.
3:04:20
In the end we actually learned they were they were all very connected.
3:04:23
I think that tends to happen.
3:04:25
I think a lot of these things will converge.
3:04:26
You know robotics, AI, crypto, like these are all the kind of mega trends.
3:04:30
Um and I think it's natural that they intersect and reinforce each other.
3:04:34
other. Um >> are you seeing a speed up in uh in crypto startups productivity on the actual software development side like coding agents for solidity or actually having a you know increase you you are >> oh yeah definitely almost all of our
3:04:52
company I we encourage them too to they use you know cursor and so is that what you mean like the >> yeah yeah yeah exactly because as a consumer I mean I I see the data from like anthropic and open AI and Gemini I see that like tokens are being spent. Uh, and but then a lot of the consumer
3:05:05
Uh, and but then a lot of the consumer software that I use, you know, the United app we like to pick on or like the flight booking app, it just feels like it's not it's not like become all futuristic all of a sudden. There's still bugs.
3:05:16
And so I'm always interested in like startups are in a unique case where they can adopt new technologies and actually new workflows and maybe gain the productivity benefit faster than legacy companies.
3:05:25
So I'm just interested to see if if it's a unique use case. Yeah. >> Yeah.
3:05:31
And I think I think it just takes a while for these things to propagate, right?
3:05:33
Like United app people ask them to do it 5 years from now or whatever.
3:05:37
But the startups are all using it >> using like cursor. It's amazing.
3:05:39
I mean I saw some study out of some university that was like >> these these tools don't make you more productive and if you just use them for I spent a Christmas break playing with curs last Christmas playing with cursor when I build a website.
3:05:50
I mean it's just ridiculous how great these tools are.
3:05:51
Of course they add to productivity.
3:05:55
>> It's just these things take time.
3:05:55
It's like humans the the bottleneck is always humans and policy.
3:05:58
I would say regulation and and humans um take time to change behaviors, right?
3:06:03
But as you say, startups tend to be the first to adopt it.
3:06:06
Yes, we see it across the portfolio.
3:06:07
We would be kind of surprised and and I don't know like just Yeah, like like puzzled if somebody wasn't using a lot of these data.
3:06:17
>> Yeah, it' be a kind of a red flag.
3:06:19
>> What does uh institutional adoption and embrace really look like?
3:06:22
Like what what are the kind of buckets?
3:06:24
Like the base case is you're supporting custody and maybe trading and then >> stop talking trash at some point and then start saying this is amazing saying that it's a joke. Uh that's helpful.
3:06:34
Uh but but how quickly do you think these major institutions can actually adopt crypto rails for you know operationally right these their job is to store and move money.
3:06:48
Crypto is you know more efficient in a lot of ways. >> Yeah.
3:06:52
I mean you can kind of think like crypto is a network.
3:06:53
crypto is a network. I mean it's a network technology right it's about building networks and it was the network where 99% like stable coins as an example where 99% of the potential nodes in the network felt like they couldn't join the network for regulatory reasons so now they're all I think you'll see it in stages so like the fintex the sophisticated fintex like stripe and you
3:07:11
know Robin Hood and Revolute and things will be first um and then over time you'll see I I think eventually you'll see just like a button on your Chase bank that's like send maybe they don't call it stable coin they call it digital dollars or something but but you'll see you know it'll just integrated into all the kind of fabric of these systems and we're seeing a lot of activity. I mean
3:07:26
I mean even you know Chase I think Jamie Diamond talks trash but I believe they have 1500 people on blockchain projects.
3:07:34
So like you know I think I think the important thing is the bit has flipped where you know like if you talk to the folks that like look we want to do this but like our legal teams won't let us like now we have legislation which is the gold standard of policy right us congress pass law so like now they feel
3:07:48
comfort to do it and that's very very important and and I think the bit has flipped where they now see it as not a threat but an opportunity um so I think it'll be you know it'll take time it'll be different kind of uh tranches of adoption based on how advanced the companies are But I think we're on that clear path now. Um, and you know,
3:08:04
Um, and you know, >> is there is there anything that's been interesting for you guys on the buyout side?
3:08:11
Like looking at, you know, let's say like a midsize financial institution and realizing like, hey, this this is a great business and if we actually, you know, were toire >> General Catalyst with that healthcare network. >> Yeah.
3:08:23
Something to that effect or or some of these role, you know, uh, >> I think you'll see that. I think you'll see that.
3:08:28
We don't actually do that.
3:08:29
It's not really our thing.
3:08:29
We do kind of stage venture but >> mostly in some later stage venture.
3:08:32
But >> wouldn't it be fun to do an LBO?
3:08:38
>> One of these things that probably sounds fun. >> Yeah.
3:08:41
>> Then you're like like those people like we get to mostly hire people in venture like LBO's you're mostly firing people and it's just like a structuring. I don't know.
3:08:49
I mean >> probably a grass is greener thing.
3:08:50
It sounds fun and then you actually go do it.
3:08:53
I think it's also just hard to actually change these organizations sometimes.
3:08:56
Like there was there's a real question like >> do you need just new organizations started from scratch or do you change them? I don't know.
3:09:01
It's not my it's not my area.
3:09:02
I'm just speculating but that mainly it's just not our thing but I think other people are doing it and I think they you know the other firms doing it will I think accelerate the adoption of new technologies like AI and crypto. >> Yeah.
3:09:12
How is the or how do you envision the role of the venture capitalist changing over the next maybe decade in crypto?
3:09:20
crypto? I feel like there's one world where you become half VC half hedge fund person that's trading liquids and trading liquids at the earlier stage because companies are kind of doing onchain IPOs and earlier stage but you
3:09:34
still need to build a position and take an opinionated view of the future of the technology assess the team how how is all that evolving how do you think that that will evolve >> yeah it's a great question so I mean what we do we've done for a long time
3:09:45
and that's one of the reasons we started a separate crypto fund right we we both >> do kind of early stage traditional venture and do things like buy tokens like Bitcoin directly in the market and then we have our own electricity and trading and we sort of built out all
3:09:56
these these capabilities at some point you'd expect that some of those things to you know be subsumed by outside organizations and kind of commoditized and these practices I would expect would propagate >> um to to other firms. Um but like I I
3:10:07
Um but like I I just look at venture like through the lens of like core like the fundamentals are always just great people. >> Yeah.
3:10:15
like we're ultimately in the talent business.
3:10:16
So there's all these other kind of mechanics and things that we've built up, but in the end we're just trying to bet on brilliant founders who have great ideas.
3:10:22
Um and that can that could just the way I view it is that can come in many forms.
3:10:26
That can come at the earliest stage equity investment that can come as a token investment.
3:10:32
>> You know, we're also betting of course on communities.
3:10:33
You think about something like Bitcoin like it's really a community at that point and it's sort of this network and community.
3:10:37
And um so I I look at it through that.
3:10:39
I I look at it through that. I always try to whenever the markets kind of get strange and things are happening I always say let's go back to first principles first principles is like believe in you know positive vision of the future great entrepreneurs doing you know pursuing big ideas um you know highly technical highly product focused and then then whatever mechanics we need
3:11:00
to do to get exposure to that >> would I don't know if this is possible if this has already happened uh but would you ever see yourself backing uh a project that looks like Bitcoin in the sense that the founders's anonymous, you can never meet them, but for some reason you do have the availability to make you do have the ability to make an investment like a venture capital investment. Uh are you equipped to make
3:11:23
Uh are you equipped to make that deal happen? >> Yeah. Yeah, we are. We are. >> Yeah.
3:11:29
>> So, so yes, we could just buy and we can just buy tokens OTC and we have an operation.
3:11:34
We've had that People don't seem to know they think of us more as venture.
3:11:36
We've had that since 2018. Totally. >> Just record. Yeah.
3:11:38
And actually two3 I would say roughly two-thirds of our investing has always been that I mean that was part of the design and why like I wanted to spin this out um so we could set it up in first principles with this structure.
3:11:51
>> Um so we had >> I want to be a crypto VC but I don't want to buy tokens that be insane >> for sure.
3:11:57
>> Well there's a whole I could tell you it's a longer story.
3:11:58
There's a whole backstory where like it was just it was just very challenging the LPs.
3:12:01
So like when we I raised the first crypto fund like I went to all the LPs and I said look we're going to do we're going to buy tokens.
3:12:07
we're going to do this and like you can opt out or opt in and some of them opted out and you know some opted in and just like look this is what we're going to do.
3:12:12
So, we have a venture structure, a venture fund in the sense that our LP relationship is a long-term relationship.
3:12:18
They lock up their money, but on the sort of that's sort of the reverse mullet or mullet or whatever where on the back end, it's like a very traditional venture, but on the front end, we can do all we can buy tokens, we can do, you know, equity investments, whatever way that we need to get exposure to great ideas and great people, we can do.
3:12:32
And that was that's been our in our thing in our kind of design from the beginning.
3:12:36
Um, and we continue to do that. >> Yeah.
3:12:39
In this analogy, I feel like the venture part is the business in the front and the and the open market trading is the party in the back.
3:12:44
But I don't know, it's a stretch analogy potentially.
3:12:49
>> But I I like a mullet analogy. It's great.
3:12:51
Uh but yeah, thanks so much for taking the time to great to get the update.
3:12:56
>> Have a great uh summit.
3:12:56
I'm sure it's going to be a great time.
3:12:59
It's gonna be an amazing time. >> Great to see you.
3:13:01
>> We'll talk to you soon. Have a good one. Bye.
3:13:04
>> Uh let me tell you about getbzzle. com.
3:13:06
Tom, your bezel concier is available now to source you any watch on the planet. Seriously, any watch.
3:13:09
And Jordy, did you put up a better run last night on eight sleep? I did okay. I got an 88.
3:13:13
Slept 6 hours and 50 minutes. How did you do? Did you get destroyed? >> 85.
3:13:20
Wait, I beat you by one point again. >> No, 85. You got an 88. >> I got an 88. Okay. A couple points.
3:13:24
Uh, yesterday in the chat, people were congratulating us on our good numbers.
3:13:29
We got to put up uh good numbers for the chat.
3:13:31
And you got to go toleep.
3:13:31
com and get a five >> TVPN.
3:13:34
Um, are there any other >> Yeah, I was I was shocked at how uh at how like viral uh I was shocked at how viral the whole like AWS uh eight sleep thing went.
3:13:47
>> Oh yeah, >> considering that uh uh >> clearly a skill issue and I was not affected.
3:13:52
>> Yeah, >> I slept right through I actually slept great. My numbers were insane. It was crazy.
3:13:56
Uh but yes, I mean somebody uh uh somebody, you know, I I I feel bad if if your if your eight sleep did like wind up getting too hot and you woke up and you didn't have a good night's sleep.
3:14:06
Uh I I I'm sending my best and I hope you get back on that horse.
3:14:11
>> And uh we'll close out with this post from Rune.
3:14:14
>> I knew you were going to go there.
3:14:15
>> Or a farming in the Zoom waiting room.
3:14:17
>> Or a farming in the Zoom waiting room. >> Just never join. Never join.
3:14:18
Just Just hang in the waiting room.
3:14:21
>> Oh, so people know that you're there. Is that how you do it?
3:14:24
>> Yeah, that you could join.
3:14:24
I feel like I mean at one point to not to break the fourth wall here and give you a little bit behind the scenes, but at one point we had multiple guests when they come in they they they hit a waiting room, the reream waiting room of course.
3:14:34
Uh and and at one point multiple people could talk to each other and they could hear what was happening on the show and it was kind of like this funny networking event that was happening and I actually think that there's there's some value there if we could get that right.
3:14:47
Uh but right now we just we just let everyone uh uh sit in silence and then eventually come on, watch the show and then join.
3:14:56
Uh so there's there's minimal aura farming in the TBPN waiting room, the reream waiting room. That's right.
3:15:00
Um but maybe we should increase it.
3:15:03
>> Well, thank you for hanging out with us today. Very fun show.
3:15:04
I I can't wait for tomorrow. Pains me.
3:15:07
We have to wait uh just under 21 hours to get back here on the clock starts now.
3:15:14
>> But yeah, the clock starts now.
3:15:16
>> Have a wonderful evening.
3:15:16
Leave us five stars on Apple and Spotify. >> Cheers. >> Goodbye.