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0:04
The US government now officially owns a 10% stake in Intel.
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The the poly market jumped to a 99% chance.
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Uh this this broke over the weekend in the >> They didn't think Uncle Sam could get an allocation.
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>> They didn't you know this is technically Intel Series A.
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>> They did a seed round of 2.
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5 million on convertible debt in 1967. >> Convertible debt. >> Convertible debt. Vintage. Arthur Rock.
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Not the anonymous poster, not Rur Rock, but Arthur Rock, >> the OG, >> the OG.
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Uh, and uh, and then they raised 6.
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8 million in 1970 and that was their IPO.
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>> So, this is their series A >> in my opinion.
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Anyway, >> back then, back then, even if you would, you would round down, right?
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Like if it was going to be 6.
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9 million e, the very Elon code to go with that number, they were close and decided, hey, let's round down. Yeah, we don't need it. Let's keep it classy. >> Um, yeah.
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So, over the weekend, the Wall Street Journal reported President says US will take big stake in Intel.
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President Trump said the government is taking nearly 10% stake in Intel, capping a two-week frenzy in Washington over the future of the company and fueling speculation about what else might be done to help the troubled chipmaker.
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Uh Trump said in the Oval Office Friday that the company has agreed to give the government the stake as part of discussions about the company's future and billions of dollars in grants it has received from the 2022 CHIPS act.
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>> To be clear, I don't think they've actually received it yet.
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They've received 2 billion already, but there was uh something like something like roughly 10 billion, maybe 11 billion in in grants and then another equal amount in loans for an Ohio facility.
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And those are are going to be rolling out and they should draw and Intel should be able to draw down on them.
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But uh they could always be rolled back if something changes and the chips act kind of goes away.
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And so um this is all the art of the deal. This is the pressure.
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Um, and so, uh, it's very funny the way Trump phrased it.
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He says, "I said, I think you should pay us 10% of the company." And they said, "Yes."
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Which is not typically how people discuss equity investments.
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>> Government grants, too. >> Yeah. Yeah.
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Well, people just don't people don't say, "Pay us 10% of the company."
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Like a VC will come to you and say, "Hey, I want to invest uh, you know, $20 million and I want a 15% stake in your company >> in exchange." >> In exchange.
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And and if anything, I you know, I would ask for that stake or I'm trying to build towards that stake.
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I want to build a position in your company, not I want you to pay me, but uh that's the nature of this thing.
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Uh so there's I mean we've all been tracking this.
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There's been a little bit of back and forth between Lip Bhutan and Donald Trump.
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He originally called for the uh for the resignation.
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We can take you through the timeline.
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The Wall Street Journal laid it out really well in an article deep dive that we'll go through.
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But let's kick it off with this Howard Lutnik video. Let's play it.
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The art of the deal colon intel and this is from Howard Lutnik sitting next to Lip Bhutan in a beautifully appointed room.
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If we can go full screen here that'd be great.
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>> I'm sitting with Lip Buu in my office.
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>> And at 3:00 we're going to sign document together in the Oval Office where the United States of America uh will own 9.
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9% of the great American technology company Intel.
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I I can't be more excited for America and for Intel that we get to work together.
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>> Well, first of all, thank you so much, Secretary.
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And uh this is a very big important historical uh agreement that we can work together and then more important, I don't need the grant, but I really look forward to have the US government be my shareholder and we can work together make Intel. Have >> you ever heard?
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So what happened is uh Lipu became the CEO of Intel >> and he came to see me >> and he said you know the Biden administration gave this company a grant of $10 billion and we don't need a grant. We're a great company.
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Maybe not with the best leadership but now it has leadership.
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>> This video is absolutely insane.
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He said, you know, and and that was the conversation.
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And then when we had the conversation with the president, >> he said, "Look, we don't want to take your money away from you, >> but shouldn't it be fair?"
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>> And we agreed that it would be fair that the same money deals from >> America should have shares for it because it's just bad.
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>> And we agreed together >> and and then you went to your board of directors. >> Yes. >> And they agreed. >> Yes.
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And it's a giant public company, so it had to be fair. >> Yes. >> Had to be fair. >> Had to be fair. >> There's no other way.
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>> And so we did it fair >> for Intel and for the American people.
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And I think this is this is exactly what Donald Trump is all about.
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I'm really excited that today we get to do the >> That's right.
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Thank you so much for your support. >> What's that?
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>> Is that a botch handshake? What happened there? >> Wa. >> Wow.
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I uh >> Lipu went for the dap up >> and Lutnik hit him with the power the power grab the power shake and it just was botched. Interesting. >> Interesting.
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We should Ben, can we can we put that in slow motion and play that back?
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Well, the journal has a timeline here.
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Bhutan was anxiously preparing for the biggest meeting of his life.
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Just 5 months into his tenure as chief executive of Intel, Tan was already fighting for his job.
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A few days earlier, Donald Trump had demanded he step down over his past ties to the Chinese military.
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The demand sent to Intel's leadership.
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The demand sent Intel's leadership into a panic.
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They immediately contacted the White House for a meeting and Tan flew to Washington huddling with advisers for hours on Sunday, August 10th.
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His team reassured him that the president would hear him out because quote, "Trump loves meeting with CEOs. Who doesn't?"
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>> Um, even those whom he has attacked publicly, according to people with knowledge of the conversations. >> Yeah. Yeah.
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He he's he's been fought in WWE. He understands.
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You call out your opponent, you hash it out, you leave it all on the field. Yeah, it's good.
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>> The next day, Tan met with Trump, Commerce Secretary Howard Lutnik, and Treasury SEC Secretary Scott Bessant in the Oval Office.
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He sought to convince the president that he wasn't a Chinese spy and that the US government has a long-term interest in bolstering Intel, one of the only homegrown manufacturers of the computer chips that power the modern economy.
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The CEO's argument proved persuasive.
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The president also took a liking to Tan, a Malaysian born Singapore raised US citizen who once considered a career as a professional basketball player and backed off his demand for the CEO's >> Li Boo.
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>> Uh, can we get a Tyler?
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Can you actually try to find a highlight reel of >> generated image of Li Bhutan dunking on LeBron James?
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>> But the truth came with a cost.
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In return for Trump support, the administration proposed taking an equity stake in the company.
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It's interesting in that video they framed it as Lit Bhutan was like you know what we don't need the money why don't you take a stake but maybe maybe you know it's kind of unclear who made the initial move >> both ways so uh just for context last year uh Intel brought in $50 billion in revenue but they lost$ 18. 8 8 billion.
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So they did not do well on earning.
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They missed on bottom line essentially. >> Just a little bit. >> Just a little bit.
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Uh and they switched CEOs.
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Obviously, they've struggled on the founding the foundry side.
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They're not making chips for they can't find customers for their foundry stuff.
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Um so, you know, if that continued for a really long time, yeah, they they would need the money, but they technically don't.
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And you can just look at the you can just look at the stock price like before any of this.
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Like it's not like Intel was trading as a penny stock.
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Like it was still it was too rich for Elon to buy with the what was it 40 billion that went into Twitter or something like that.
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Like it I I remember thinking like oh I would prefer if he bought Intel potentially because that one seems important.
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Um but uh but it's always been around $80 billion company and so uh like if if it was truly on the brink of bankruptcy the the shares would be falling even more in my opinion.
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So I I I think Lipu is not being disingenuous there.
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They actually could get by without the money.
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Um but they would they need to restructure like very seriously and Liputan's like doing that. Like he's cutting a ton. He's going to cut more.
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And if you cut everything that's not additive to that 50 billion and you just try and hold on to as much of that 50 billion in revenue as possible and you cut everything that's losing money.
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Um yeah, you should wind up with something that actually generates, I don't know, maybe $10 billion of free cash flow.
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>> Not a bad little business.
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Intel decided to convert nearly 9 billion in grants promised to Intel as part of the 2022 chipsack into a 10% equity stake in the company.
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An unusual arrangement that makes the government Intel's biggest shareholder meeting was a pivot point in a frenzy period for Intel.
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Once one of America's most venerated technology companies now stuck in a year'slong downward spiral.
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The company's scramble to control the fallout from the president's demand that Tan step down.
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Ton uh triggered by a Fox Business Network segment underscores the unpredictable environment major corporations face under Trump.
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By the end of the twoe roller coaster ride, uh Ton's job appeared to be secure and the company's situation more stable.
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Japan Soft Bank Group agreed to invest 2 billion seeking to curry favor with Trump.
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On Friday, Intel and the White House uh unofficially officially revealed the terms of the deals.
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He came in, he saw me, we talked for a while. I liked him a lot.
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I thought he was very good, Trump said of Tan from the Oval Office. I said, you know what?
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I think the United States should be given 10% of intel.
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And he said, I would consider that.
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Yet a host of questions remain.
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>> This might be the gong of the day.
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This might be the true size gong moment. This is the fundraising. >> Hit that gong. >> Congratulations.
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>> Clean first hit of the week. It is good to be back.
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>> We're calling it uh 1600 Pennsylvania Ventures. >> Yep.
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White House Capital Group.
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>> White House Capital Group. >> Trump.
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>> Uh, Tan must resolve core business challenges to get his company on track.
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Some analysts say Intel isn't in a much better position without new commitments from customers.
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Converting government grants to stock will only leave the company in a worse financial shape by diluting shareholders.
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Trump will likely need to find more ways to support Intel, not wanting it to fail on his watch.
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>> And that's why Liputan's like genuinely excited. >> Yeah.
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because now you're in >> Trump is effectively the spa sponsor of Intel now.
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It's a new it's a new era.
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>> Yeah, he has bags and so he's aligned and so if Luthan needs to come to him and say, "Hey, you know, we're trying to make this a facility in Ohio. It's not going well.
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We need you to put some pressure on some customers.
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>> We need to line up some customers."
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All sorts of things like in terms he's value ad.
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>> He Trump is value is a value added investor. >> He's got audience. He's got business.
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He's got he's he's got I mean he's got his own social media tech giant. >> True. True.
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Could be a potential buyer.
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You know, maybe maybe Truth Social becomes a hyperscaler. >> Yeah.
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>> You know, it's happened before. >> True. Truth cloud. >> Truth cloud.
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>> Uh Intel needs a lot of help and the US needs Intel, says Jimmy Goodrich, a senior adviser to the think tank.
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Rand who focuses on tech issues.
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Hopefully something good is going to come out of this.
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>> We had we had Jimmy on the show like two days ago.
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>> Jimmy Jimmy, good work, Jimmy.
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Uh, Intel was founded in 1968 by semiconductor pioneers Robert Noise, who co-created the modern computer chip, and Gordon Moore, originator of Moore's law, the idea that computing power and chip efficiency would likely double every year or two, a guiding principle in the tech revolution.
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By the '90s, Intel dominated the market for processors used in personal computers.
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Its Pentium line and Intel inside marketing campaign with dancers and multicolored clean room suits made the company a household name.
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Then came a series of tragic missteps.
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The company largely missed out on the mobile phone and artificial intelligence booms by overemphasizing short-term financial targets.
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Analysts say rivals in chip design like Nvidia and manufacturers such as Taiwan semiconductor surged ahead.
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It's interesting how you if you're a huge uh tech company, you can miss maybe one platform shift and do fine, but you miss two, you're going to be rough.
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Even >> even Microsoft said, you know, we miss mobile.
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Yeah, get into social media, >> LinkedIn.
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Yeah, you could you I it's a really really stretched metaphor, but you could say that like Nvidia missed mobile more or less like the like they weren't really switching into okay, let's be the design arm of because the the iPhone, >> you were buying enough chips for your gaming. >> Yeah. Yeah. Yeah.
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No, it was just a gaming company at that time mostly in scientific computing a little bit, but um there is a graphics processing unit on mobile phones.
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uh it's just part of the system on a chip that goes into the phone and it was never Nvidia never really like figured out a way to get a piece of mobile uh and and there's a world where like the cloud rendering stuff happens but uh Nvidia kind of sat that out but it didn't matter because they they they crushed AI.
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So company is still as keen to reviving US manufacturing.
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>> Look at Nvidia's sales.
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This is sales by quarter and it's just like and this is what a 30-year-old company is just completely completely off to the right.
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Looks like a YC demo day. >> Looks like a ramp. >> It's crazy.
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>> Um the company is still seen as key to reviving US manufacturing.
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In his first term, Trump touted Intel's plans for 7 billion manufacturing plant in Arizona.
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Trump advisers began discussing what became the Chips Act, wanting to attract companies such as TSMC to the US.
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>> Has Arizona tried to brand like what they're doing?
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They have so many different uh chip manufacturers coming into Arizona.
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They need like Silicon Desert or something. They like Chip City. >> Chip City.
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It really feels like like there there is a significant center of gravity that Yeah.
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that that will ultimately become like a company town type vibe. >> Chip City.
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As discussion on the chips acts uh crescendoed during the Biden administration, Intel Pat Intel CEO Pat Gellzinger lobbied aggressively hoping for some of the laws tens of billions of dollars in subsidies.
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In 2022, he sat in the first lady's box for the State of the Union speech during which President Biden touted Intel's investment plans.
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While the bill was being negotiated, senators including Bernie Sanders and Elizabeth Warren pushed unsuccessfully for a version that would see the government receiving equity in companies it backed. Uh, very interesting.
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This is what Mark Cuban was saying last week.
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He was saying this is Sanders and and Warren's dream.
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um he said it in a little bit um uh less uh PG language if I remember correctly, but Intel became the law's biggest beneficiary, qualifying for roughly 11 billion in grants and and about 11 billion in loans for a plant in Ohio, an expansion in Arizona and other projects.
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It seemed like a boon at the time, but the law law's slow roll out in Intel's core business challenges led to repeated delays. >> Talk about ROI there.
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>> Talk about ROI there. like the like Lip Bhutan saying like you know we don't need these grants and I think he's like technically correct but it's an incredible nice to have and the ROI on your CEO going to the state of a union and just sitting in a box and like taking some meetings and you know I
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don't know what Intel's lobbying budget was but it probably was less than 10 billion right it was probably less than 10 million it probably wasn't very much at all and uh and and you get a huge >> uh friend of the show Andrew Ross Sorcin said yesterday Should the government start taking equity in every startup for the federal tax incentives we offer? Or Or Tesla? How about the banks?
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How about when a state government offers a tax incentive?
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Should they get an equity stake in exchange board representation?
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This is a super slippery slope.
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And uh Bill Gurley said, "Here's my take.
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If the government is a quote unquote lender of last resort, they should take a 100% take equity and arguably 100% of the equity.
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Failed to do this with GM, Goldman Sachs, United, and other airlines.
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How do you know if they're the lender of last resort >> of resort?
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The company takes the deal. >> Takes the deal.
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>> Um, which uh trash >> because otherwise the the the company would go with a financial investor who says I only want 50% for the same price or whatever.
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Uh, and so um I it is a it is a good uh it's a it's a good point.
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It's a good point by Bill.
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So, uh, in reference to the original Chips Act grants, uh, the Journal says it seemed like a boon at the time, but the law's slow roll out in Intel's core business challenges led to repeated delays.
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Late last year, Tan, who had been an Intel director since 2022, left the board in protest of Galsinger strategy.
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The board also soued on Gellzinger and pushed him out.
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Trump's victory presented another curveball. He had bashed Biden.
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>> Quitting in protest, deeply underrated.
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Deeply underrated strategy just in life. >> Yeah. >> Yeah.
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I I I respect Tan for for quitting in protest and then ultimately getting >> back for the top spot.
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>> It's It's pretty It's pretty sick. >> Pretty sick.
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Under underutilized strategy. >> Yeah. >> Just I'm out.
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>> He decided basically in the trough of disillusionment.
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He quit in protest and then he said, "Yep, I'll pop back on the the roller coaster for the slope of enlightenment."
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That that's where Intel is.
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We're really Yeah, I think we're I think I think we were >> Who's who's on the slope of enlightenment?
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I thought we were doing three colors. Me, you, Tyler.
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>> I didn't get Tyler on there yet, but you're on You're You're just innovation.
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You're just coming up to the peak.
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>> I just went to San Francisco.
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I was talking to AI researchers.
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They told me deep learning is undefeated.
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They told me that pre-training scaling will continue.
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And so I'm I'm I have yet to in I my infl my expectations can continue to be inflated.
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>> I am looking at the trough.
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>> You're looking at the trough.
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>> I'm looking at the trough.
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>> You're going straight >> Tyler. Where are you?
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>> I think I'm where Jordy is too.
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It's the red one other side of the of the >> down. Wow.
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I thought you were so AGI pilled, bro.
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I thought you're so AGI pilled.
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>> But I I mean like Okay, even Daresh Daresh is extending his timelines.
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Daresh is extending his timelines. Like how can you I mean it's hard to still be >> extending the timeline just means that the the the initial innovation trigger slope is just going like this but he's still he's still going up he's still going up and to the right he's happy
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are worse's expectations >> I don't know I don't know let's just uh sprint to the plat plateau of productivity the real move is that I I don't think we're in the trough of disillusionment yet >> how about how about I think we need to make the TVPN version of for the AI hype cycle >> and the slope of enlightenment. We need
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We need to just like >> another another vertical line.
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Another vertical line >> for the fast takeoff scenario. >> Yeah. Yeah. Yeah.
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It's like we get a bubble, we get a crash, and then we get a fast takeoff.
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That's the most likely for sure.
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No, our job is is to recognize and diagnose when we are in the trough of disillusionment and reillusionize people such that we can get to the slope of life.
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>> I've never been in a trough of disillusionment that didn't one day get to the >> slope of enlightenment. >> Exactly.
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>> So, there's always hope. There's always hope. >> Yes.
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>> Uh but uh anyways, >> you know what could have made that video better?
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>> If it was streamed on reream. >> That's right.
19:03
Live >> one live stream 30 plus destinations multiream and reach your audience wherever they are. Lip Bhutan.
19:07
Uh Howard Lutnik, if you're listening, get on reream. Anyway, continue. Jordy, >> of course.
19:14
Uh so Trump's 2024 victory presented another curveball.
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He bashed Biden's implementation of the chips act, fueling worries that could he could try to change deals or cancel them altogether.
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Intel's financial condition worsened and the incoming administration worried the company might fail.
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Even with the recent share price rebound in August, followed by reports of the deal with Trump, the company is now valued at 110 billion, a fraction of its com bubble peak, the stock is down roughly 50% since the start of last year. Wow.
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>> Intel has has been left behind, Trump said last uh Friday.
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So around Trump's uh inauguration in January, Lutnik and administration officials began evaluating chips act recipients and which tech companies generally could increase their US investments in line with the president's goals.
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They asked semiconductor companies receiving chips act awards to increase their total US investment, but they knew they might need to revamp Intel's deal or help the companies in other ways.
20:07
What's interesting there is that um when we talked to like all of this is like like everyone's doing art of the deal on each other and meanwhile like when we talked to Doug Olaflin at semi analysis he's like realistically like all this trailing edge capacity is going to be done in like South America like it doesn't make sense to do it in America.
20:27
like a lot of this stuff is just going to wind up getting offshored because it's easier to build some facility that's just copy pasted down there.
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And so uh it it it's very unclear like how like how it can actually work in the long term.
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And then and then on the leading edge like it seems like it's TSMC and Samsung like Tesla's going with Samsung and those will be in the United States and those will be like cutting edge like PhD level jobs amazing researchers like really really great like American innovation but like we're kind of already on that path and Intel's not really the party that you need to be twisting the arm of.
20:59
It feels like if you want America to be like the leading semiconductor c country, you just need to make sure that you have leverage over TSMC and Samsung. Not so.
21:08
And maybe AMD, Global Foundaries a little bit.
21:11
I mean, Global Foundaries is part of Intel now, but um but a lot of the uh a lot of the trailing edge like it seems like it might not be a long-term thing that America's ever good at again because it's like it's commoditizing so rapidly. I don't know.
21:25
Anyway, uh clearly Trump cares about it and wants to keep it here.
21:29
So that's what he's pushing for.
21:30
Um the administration began early conversations with Intel's board about taking an equity stake.
21:34
The talks didn't move forward in part because the board, which has often been mired in disagreement, wanted more than the administration was willing to give.
21:43
>> Did they want to take take a bigger position?
21:46
>> No, they probably wanted like 40 billion in in grants or something like give us more for that.
21:50
Former banker Letic has had in recent months asked other tech executives what can be done to help Intel.
21:57
even asking other chip companies like TSMC, AMD and Micron whether they would cont cons consider potential deals.
22:02
deals. This is what um this is what Doug is Doug has just generally wanted people with semiconductor manufacturing experience to be involved with the company >> and so it's very possible >> this seems like a step in the wrong
22:15
direction according to his heristic because it's like more government people on the board but I mean to be clear the US government is not taking a board seat and not having a controlling stake uh it's a purely financial stake which we'll get into. So, uh, in March,
22:27
So, uh, in March, Intel's board named TAN65 as CEO.
22:29
One of the biggest decisions he faces is whether to keep the company as one of the few chip firms that does both design and manufacturing.
22:36
Some analysts say Intel should consider splitting the business or doing other types of deals to cut cost.
22:42
Tan has so far shied away from spinning off the manufacturing segment, which lost 3.
22:46
2 billion in the second quarter.
22:48
He has told Confidence he has inherited a very bad hand.
22:50
In July, Intel said it would lay off 15% of its workers by year end, cancel billions in plant investments, and further delay work on the sprawling Ohio plant.
22:59
Uh, the new rules of the road were no more blank checks.
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Tan wrote in a memo to employees.
23:06
Uh, Tan's early decisions at Intel were aimed at getting the company on more stable ground, but the CEO's past work at chip design software company Cadence Design Systems thrust the company into the spotlight.
23:16
In Jul in late July, July, uh, Cadence agreed to pay $140 million for violating US export restrictions by selling banned technology to a Chinese national defense university.
23:29
Uh, the sales happened while Tan was CEO.
23:31
So, you know, you like it seems like he probably had to sign off on that in some way.
23:36
Of course, it's like is it a university?
23:37
Is that like I don't know.
23:40
I I don't know how you like steelman this or dig into like, you know, >> Steelman itself.
23:45
you're steel man champion of the world. >> Steel manning.
23:48
>> Steel manning. It would probably be like the the export restrictions are just like super complicated and it's unclear and it's one of those things where it's like there's the spirit of the law and the letter of the law and they made some case for um you know in this particular
24:01
in this particular technology did not fit within the export restrictions because the export restrictions might just be like um you know oh chips of a certain size or scale and they had and they had a chip that was like slightly under and then they and then the
24:16
government like you know reinterpreted the export restrictions to include that like this stuff happens all the time um because when these when these export restrictions get get um get written it's easy to >> you don't hear much about cadence design systems by the way it's $95 billion
24:33
public company >> yeah and and and that's why people think Lib Bhutan's so equipped to run Intel because he took that company to like a hundred billion market cap basically from I think like five or 10 or something when he be when he uh when he joined the company. So, he is uh he's a
24:47
So, he is uh he's a talented operator.
24:49
Um so, uh a week later, Senator Tom Cotton sent a letter to Intel's board raising concerns about Tan's chai ties to China.
24:58
Trump was watching, this is wild, Trump was watching Fox Business Network on August 7th when host Maria Bartoromo highlighted Cotton's criticism at 7:34 a. m. Eastern time.
25:11
5 minutes later, Trump fired off a message on his Truth Social.
25:18
The CEO of Intel is highly conflicted and must resign immediately. It's crazy.
25:22
He's just watching the news and then posting about it.
25:24
Uh >> Journal says it was one of the first times in modern history that the president publicly called for the leader of a major company to step down.
25:30
Trump's demand was seen by some on both sides as an opening bid in negotiations with the CEO.
25:36
The president had already grown intrigued by the idea of government stakes in key industrial companies during his May trip to the Middle East.
25:43
a senior White House official said, though the official added that it wasn't what sparked Trump's post.
25:46
The president wants to see more such deals in the future.
25:51
>> Well, if you're trying to maintain compliance, get on Vant.
25:53
Automate compliance, manage risk, prove trust continuously.
25:56
Vant's trust management platform takes the manual work out of your security compliance process and replaces it with continuous automation whether you're pursuing your first.
26:04
Imagine that will be we know that Trump is not going to be on the board and not going to be sort of directly pulling the strings on the business, but I imagine one of the first things he wants lip to do is >> implement. Yeah, for sure.
26:14
Uh so Intel stock price has been on a tear.
26:17
Shout out to Leopold Ashen Brener at situational awareness. >> They mocked him. They mocked him.
26:23
They said this guy's fund must have already blown up. >> Yep.
26:27
Oh, he's a weird non- consensus bet. Oh well, it paid off.
26:30
Uh so uh the question resignation mid August uh then Trump met TAN Soft Bank invested 2 billion and the share price rose from under $20 to over $25 a share uh and the deal has been announced.
26:47
So um anyway, sorry I cut you off.
26:49
No, I think I think people were speculating whether Leupold had some inside information or he just viewed intel as a super strategic asset that >> there was some post about this wouldn't possibly let fail.
27:04
>> There was some guy on on X saying like, "Oh, this is like insider trading.
27:07
Everyone is insider trading.
27:07
Even like Warren Buffett made his money on insider trading. Very blackpilled."
27:11
And uh and somebody tweeted just being like, "There's no evidence of any of this happening at all." And and it Yeah.
27:19
Wait, what you got, Tyler?
27:20
>> I think also like this trade like him being long intel >> totally aligns with the thesis of the of of situational awareness.
27:26
Like his whole thing is they're going to monitoring the situation.
27:32
>> They're going to nationalize like AI. >> Oh yeah.
27:34
>> So obviously like >> if the US is going to nationalize like start a lab, start like building comput stuff, they're going to have like they're going to take the existing Y, >> you know, infrastructure. >> Yeah. Yeah.
27:44
I had even thought about it from that perspective.
27:45
I was just thinking about it from from the perspective of like like we we we talked to Ben Thompson about Intel.
27:49
We talked to Doug Olaflin about Intel.
27:50
Like we were kind of like noodling on it back and forth as like commentators and I didn't come away with a super strong like bull or bear case.
27:59
I didn't really look at the stock price or the valuation or the financials, but it didn't seem like crazy to come up with a like a like a an expression of your position in a in financial terms.
28:10
And it's very clear that like Leopold and his team just like looked at Intel more deeply and saw that there was an opportunity there.
28:17
You don't need not every good trade needs to be inside of training people. It's like so ridiculous.
28:24
>> Um >> and uh and yeah, I mean it's the same thing like it's like what what does he know about Nvidia?
28:29
Like is it possible he just he just knows that like every like he's not in Nvidia. What does he know?
28:35
Is he insider trading or is he just like looking at like oh well Nvidia is like the obvious bet so everyone piled into Nvidia.
28:40
It's like the biggest company in the world.
28:42
Like maybe not a lot of juice left there.
28:43
I'm going to go where >> get 20%.
28:46
>> I'm gonna go and bet on the things that have high upside potential.
28:48
And >> yeah, I don't know.
28:50
Anyway, uh in the Oval Office, Tan told the president his ties to Chinese businesses were years in the past and he was loyal to the United States.
28:58
He presented ideas for turning Intel around and investing more in the United States.
29:01
Lutnik told Tan that he thought it was dangerous to have so much of the global chipm capacity controlled by foreign companies.
29:07
Tan agreed and reiterated that he was dedicated to Trump's America's first manufacturing agenda.
29:13
By the end of the hourlong session, the president was convinced and agreed to lay off the criticism.
29:21
>> I will no longer call for your immediate resignation on my social media app. Mr. Mr. Tan, >> that's great.
29:28
>> Uh Tan and Lutnick then move quickly to hammer out a deal for the government to take a minority stake in Intel.
29:31
It was complicated negotiation because it was unusual to convert government grants that had already been awarded into equity.
29:37
While they were in talks, Soft Bank, led by MASA, suddenly agreed to put two billion into the company, part of it campaign to bet on US firms and appeal to Trump.
29:46
>> If they were uh putting together like a pitch deck for Soft Bank, I feel like they should have used Figma for that, >> right?
29:52
>> Think bigger, build faster.
29:52
Figma help design and development teams build great products together.
29:56
>> I would be shocked if SoftBank uses Figma uh for their the design of their decks. Yeah.
30:02
because they seem to be very PowerPoint coded, but they still are powerful.
30:07
Imagine how powerful they could be if they would, you know, simply get on Figma slides. >> Let's see here.
30:13
Um, did I tell you that my first internship ever was at a SoftBankbacked company? >> No way. >> Yeah, drdrew. com. So, Dr.
30:24
Drew was a radio host with Adam Corolla on Kiss FM in 2005.
30:33
>> Wait, that's crazy lore.
30:35
>> Yes, this is insane lore. So, um, Dr.
30:38
Drew was a uh like a boardcertified psychologist, psychiatrist, I think.
30:45
>> Wait, we're pulling up this website, by the way. >> And so, Dr.
30:47
Drew during the dotcom boom wanted to start his own like live stream property basically and raised money from SoftBank and built a team of engineers and had had their own data center racking servers and one of my jobs is like go to the >> well I mean this is like what it is now because he has like podcast and stuff >> and and you don't really need like a necessarily like a ventureback startup to be an influencer. Um but uh uh >> so Dr.
31:21
went to the same high school as me.
31:23
Uh and uh loves >> every single famous person has gone to John's high school. >> Yeah, it's wild.
31:28
Um but yeah, like but like one of my like you know pop by the summer office was like go in the data center and it was like super cold.
31:36
It was like not like a data center like people think today.
31:39
It was like a room with a couple racks of servers but there was no AWS.
31:44
So if you wanted to set up a website, you had to like rack a server and like put this put the code on the server and then run it.
31:51
>> Just put the servers in the bag, bro. >> Yeah.
31:53
The brand was a little bit different back then.
31:54
Uh the first show that they were going to greenlight was this sort of like it was about a lot of his stuff was like relationship coaching. So love line.
32:02
People would call in about their relationships.
32:04
And so I think I believe they were going to put two people like a like a man and a woman who were maybe dating and they were going to go on a road trip and they were going to like live stream it.
32:12
Um, and it was gonna be like some sort of like new new media.
32:17
>> Well, all I can see is I can see why Masa needed needed to be in that needed to be in that website.
32:22
John, >> it is it is incredible lore.
32:23
Uh, >> is that part of how you underwrote the internship, too?
32:27
You're like, look, you know, >> I was really like technically an intern. I I was I was so young.
32:30
I was just like stopping by the office basically.
32:32
But, um, but it it was cool.
32:34
It it was like a true startup environment.
32:36
Like a pool table, like pretty big office.
32:38
Like very much like >> pool table. >> Yeah, pool table.
32:42
It it was very it was very iconic of like >> pool tables in office.
32:47
>> No, now it's like ping pong tables. They've taken over.
32:49
Um >> we should Do you like pool? >> I like pool.
32:53
>> Okay, we should get a pool table back here. >> Billyards. >> Billiards. >> Yeah.
32:56
>> Um yeah, it was like the classic like kind of overfunded uh ventureback.
32:59
com uh bubble company where like huge staff for something that like would ultimately be uh >> small media company. >> So yeah. Yeah.
33:10
a media company that should focus on like the media piece and then and then like the YouTube should just be like a platform and so it's like it's like it didn't make sense to be in like the middle.
33:18
You either just wanted to be like the influencer or the uh or the platform.
33:22
Anyway, >> so SoftBank had already pledged to spend at least 100 billion in the US on AI and other tech investments.
33:27
A move announced by Sun at Trump's Mara Lago Club last December.
33:31
Soft Bank had also earlier this year discussed a potential deal to acquire Intel's chip manufacturing business.
33:37
Intel and the US soon agreed the government would use 8.
33:40
9 billion in grants that have been committed but not paid to take a nearly 10% stake at a slight discount.
33:47
>> The US won't have a say in governance. It already gave Intel 2.
33:49
2 billion in chips acts grants.
33:52
That was what we were talking about earlier.
33:54
Some had been given but not all that was promised.
33:58
David Shapiro, a former partner on the Wall Street firm Watchdoll Lipton and Rosen and Catz, drew up the terms, including a provision that the government could acquire another 5% of Intel at a discount if the company sells the majority of its manufacturing business.
34:12
>> This is an underrated naming scheme.
34:12
I I I really wish startups would do this.
34:16
Like the next like AI startup should just be like Hayes and Cosgrove and >> this could be totally a new meta.
34:21
It can only be done once. >> Yes. >> By a great team.
34:25
If we did Kugan, Hayes, Cosgrove, and Coler, it would be amazing.
34:31
>> I mean, at at some point, we should just add the whole team.
34:34
>> The whole team longest.
34:34
We could definitely get the >> last names, >> Kugan and Hayes and Cogrove and just >> over and over and over.
34:41
So, the administration insisted on this provision as 5% at a discount as a type of poison pill meant to dissuade the company from fully exiting the manufacturing segment.
34:52
Um and this is this is what people are really excited about you know government involvement in the decisions of uh of of of >> highly technical projects >> highly technical complicated businesses right >> government famously good at building things. >> Yes. Yes.
35:06
Um so if Intel were to give the government another 5% obviously dilute shareholders and complicate things.
35:13
So despite the initial optimism many analysts say the agreement will only be a boon for Intel if Trump can also find customers and attract more investment for the company.
35:21
I think he's going to be able to do both to be honest.
35:24
I think he's going to be able to strongly encourage other companies.
35:28
>> He's not going to be like a VC that just like sits back and like reads the investor updates.
35:31
>> There's one thing people can criticize Trump for a lot of things, but he is available the week of August 25th. He's online.
35:38
While many allocators, he's not a Burning Man.
35:41
>> He's not a Burning Man, >> which is crazy. Interesting. >> Which is crazy.
35:43
You'd think that he's starting to get into venture that he would naturally he would go to Burning Man, >> set up a an oval office camp at Burning Man, >> but instead of being at Black Rock City, he might be at Black Rock. >> That's right. Deals doing deals.
35:56
Um, that was uh that was one of our good uh there's an early episode of 2BPN where John and I are riffing out Black Rock City, >> the home >> the home of Burning Man >> and wondering if there's a connection to almost certainly a connection >> obviously a connection to Black Rockck >> financial institution.
36:19
>> Uh Soft Bank's 2 billion and the 8.
36:19
9 billion in government funding that had already been promised aren't gamechanging for the chip manufacturing business.
36:26
In the grand scheme of thing, it's it's not >> it's so they lost 18 billion last year.
36:30
Like we're not even covering these losses, >> but better to have and not need, I suppose. >> Yeah.
36:36
So, the agreement is fueling speculation that the president could lean on other tech companies to work with Intel.
36:41
Lean strongly encourage uh demand that they are fired if they are not if they do not.
36:48
>> He's gonna read some posts.
36:48
Tan has met with potential customers, including Apple CEO Tim Cook, trying to win support for Intel's next generation manufacturing process.
36:54
This is not the kind of thing I I I see Tim being super interested in.
37:01
He's like more expensive, less performant.
37:06
>> Apple has spent what, a decade getting off of Intel and Intel Max and going to Apple Silicon, which are like so integrated, so perfect for the Apple ecosystem.
37:14
like like now like you can run you can run iOS apps on Mac and vice versa.
37:21
Like it's like there's a ton of there's a ton of uh like they've been spinning up like the the ecosystem on top of Apple silicon for so long like the different graphics engines and getting developers to go deeper into optimizing for Apple silicon just like rug back on. >> Yeah.
37:39
The journal says many executives say they would need big incentives to use Intel for manufacturing given how badly it trails industry leaders like TSMC.
37:46
It is difficult to switch semiconductor manufacturers because the pro processes are specialized and have to be planned out years in advance.
37:52
The government's taken Intel is the latest in a series of extraordinary interventions in the private sector.
37:58
>> I mean, what's the craziest thing that they could do?
37:59
Like Apple GPU for a cluster at Intel or something like kind of fresh start.
38:06
That seems like something way out of their wheelhouse of both companies.
38:11
>> I have no idea how they would do that.
38:12
But I mean, if >> if Amazon can do Tranium and and Google can do TPU at TSMC, like maybe there's a world where that happens. I don't know.
38:23
Anyway, Global Foundry's punching the air right now.
38:25
Um anyway, um >> um the administration, >> so they highlight a couple of the other deals worth covering.
38:30
So the president won a quote unquote golden share of control over Japan's Nippon Steel in return for allowing it to take over US steel.
38:39
These golden shares are in reference to what the CCP >> Oh, I thought it was in reference to the president's toilet, which is gold. >> Yes.
38:47
And many many of the fixtures in his in the Oval Office. >> Yes.
38:51
Um but um and last month Trump struck a deal with Nvidia and AMD for the federal government to take 15% of their chip sales in China in return for allowing the exports.
39:02
>> In early July the Defense Department took a minority stake in MP Materials, a maker of Rare Earth Magnets.
39:06
Days later, Apple, which the Trump administration had long pressured to expand its US supply chain, announced a $500 million deal to buy MP's products. >> Yeah.
39:17
So that's an example of like Trump like acting as uh you know bisdev basically for the companies he likes.
39:24
>> I mean he's really going to make a lot of ECs look bad that big promises during the deal process when they're trying to win allocation >> and then kind of >> I'll help you ramp your revenue for sure.
39:33
I know a lot of the top I know a lot of the top guys.
39:36
>> I know a ton of founding engineers.
39:36
I don't have 50 other portfolio companies that also want to hire founding engineers. >> I got you. I got you.
39:42
Um, but the intel stake is among the most notable notable given Trump called for Tanda to resign then quickly brought him to the negotiating table.
39:51
There's this Darth Vader aspect of the whole thing, said Guantanam Makunda, a lecturer at the Yale University School of Management, never heard of it, who studies innovation and leadership, referring to the Star Wars villain who started as good, became evil, then redeemed himself.
40:08
Um anyways uh >> so >> do you want to read through this post from >> the big question is is this socialism >> maga socialism >> is this maga socialism a lot of people have been saying this and and I mean I think like my default take is that uh like I don't know that Intel is so critical that we need necessarily a backs stop.
40:32
I don't necessarily know that uh the government is the right board.
40:38
>> You don't trust Doug on this?
40:40
>> Doug really doesn't want Doug from semi analysis really doesn't does not want Intel to fail. >> Yeah. I don't know.
40:46
I I I'm I'm still like on the fence about it.
40:48
Um but uh so the debate has been raging like is this is this socialism?
40:53
Um and so we're going to the socialists who are self-proclaimed.
40:58
the people's line uh from Carl uh Beher uh and Carl says no, but that hasn't stopped Democrats from complaining about it.
41:08
And this is interesting because um obviously the Trump camp is very pro this deal and they're saying this isn't socialism.
41:16
What are you talking about?
41:16
We're just doing art of the deal.
41:17
We're making good deals and we're uh we're this is an America first agenda project.
41:20
Um the Democrats are saying, "Oh wow, Trump is a hypocrite. This is socialism."
41:25
The socialists are saying this isn't socialism.
41:28
It doesn't go nearly far enough.
41:30
It doesn't count as socialism because it's not a controlling stake.
41:34
So, uh, Carl says former under Obama under secretary of the state Rick Stangle is freaking out right now over the news that the Trump administration has taken a 10% equity stake in chip manufacturer Intel.
41:46
This is a quote from Rick Stangle.
41:48
Uh, Trump Trump's strongarming Intel for government equity is something Mao and Stalin would be proud of.
41:54
Once the GOP believed in lazy fair capitalism and government not interfering in the private sector, look it up.
42:01
The state owning the means of production is called Marxism.
42:04
Uh so Carl, >> I couldn't find any evidence of Elizabeth Warren or Bernie Sanders taking a victory lap on Trump's >> uh acquisition of Intel shares. >> Yes.
42:18
>> Uh which was surprising given that back in in the Biden admin era they were pushing for this. >> Yes.
42:23
But the key discussion that's going on right now is is financial uh financial ownership versus true control over capital.
42:32
And that's what Carl's going to get into here.
42:33
So he says, "Anyone old enough to remember the phrase government motors."
42:37
This is from the era of the take of the takeover of GM should be able to appreciate what a wild line of criticism this is to hear from a former Obama official.
42:45
As part of his troubled asset relief program, TARP, Obama took for the US government a 61% equity stake in General Motors and the rights backlash was entirely p predictable.
42:57
Rush Limbaugh called this a sterling example of the left's crusade for government control of business that proved the left's enchantment with socialism.
43:06
John Stal complained that this was a move toward more government control of the economy and in the end that's pretty close to socialism.
43:13
uh that so many liberals have adopted this line of criticism.
43:16
Joe Car Joe Scarboro took it up on Thursday and Democratic consultant Jessica Tar Tarlov ran with it on Friday for example should probably provoke some reflection among socialists who think of liberals as fellow travelers.
43:29
While socialists may share certain egalitarian values and other priorities with contemporary Democrats, American liberals are still reflexively ambivalent to hostile toward the basic socialist agenda of nationalization.
43:42
They will opportunistically support it when it's time for Democrats to bail out the economy, but they will aggressively attack it if they thinks if they think this will score points against Republicans.
43:51
There are a few things that contemporary liberals enjoy more than catching a Republican doing something that they can rightly or wrongly construe as socialist.
43:58
In this case, I would say wrongly.
44:00
Stangle's definition of Marxism as state ownership of the means of production is confused for all kinds of reasons.
44:06
But here are the most salient that uh but here the most salient is that ownership does not imply control.
44:13
Even if this was ordinary equity 10% would hardly give the government any kind of significant control over the company.
44:20
But as Intel made clear in a statement, this deal doesn't even give the government 10% control.
44:24
Quote the government >> but no no. So there's more.
44:27
The government's investment in Intel will be a passive ownership with no board representation or govern or other governance or information rights.
44:35
The government also agrees to vote with the company's board of directors on matters requiring shareholder approval with limited exceptions.
44:42
So this notion of passive ownership perfectly illustrates why socialist would would do well to talk about control rather than ownership of the means of production.
44:51
A major function of modern finance is to sever the relationship between those two.
44:55
To identify control, you have to look past the legal and business terminology and figure out who actually has the final say over any given lot of capital.
45:02
In that light, it isn't clear that 10% ownership stake even represents incremental progress towards control of Intel, which is what uh the socialists want.
45:11
Uh convincing a business to give you 10 a 10% non- voting stake in their company is very different thing from getting a 10% voting stake, let alone a 51% voting stake.
45:19
Nevertheless, American partisans clearly aren't interested in litigating the fine details between ownership and control.
45:24
And that's why socialists have an interest in this fight.
45:28
If Democrats are going to vilify Trump as a socialist, the best response is to complain that he isn't even doing socialism. He's not doing enough.
45:35
>> He's not doing enough.
45:35
And so, um, my my my takeaway from this is that, uh, it's a good point.
45:40
Like, it is not the goal of socialists, but at the same time, it reaffirmed that I do not want to do the socialist thing here because I don't want the government voting on what Intel should do.
45:51
Like I don't think the government's equipped to make the decision on on how they should position against TSMC, where they fit in Apple Silicon versus TPU versus Tranium.
45:58
Like it just doesn't seem like government's set up to actually run this company more effectively than anyone else.
46:04
And so I'm very hesitant about that.
46:07
It sounds like something that's like very good in some abstract sense to the socialists, but I have no I have no faith that if the government were to get a 51% voting stake in Intel that we would get a better outcome here.
46:24
>> Well, the better outcome people were talking about this on the timeline would be Trump answering questions on earnings calls.
46:30
>> That would be fantastic.
46:30
Maybe that's maybe that's a good outcome.
46:32
Yeah, but it'd be odd to have like uh I mean if we went to pure direct democracy and socialism like you go to the ballot box and you vote like are we going to do three nanometer like decide you decide like yes or no like I think it's I think it's a waste of money >> or just have the the whoever's the Intel CEO just have that as you know an elected >> basically >> official like let the people vote on who should be running. >> Yeah.
47:00
I mean the question is like how much democracy do you want?
47:01
You can vote on everything.
47:03
You can vote every single day.
47:05
California is extremely democratic.
47:07
We have ballot measures for all sorts of things.
47:08
We tend to not do ballot measures for different things at the federal level.
47:12
We have a representative democracy, not a direct democracy.
47:13
And but if you if you really play out the direct democracy socialism thing, it's like, yeah, you'll be voting on whether or not Intel launches a GPU.
47:21
Like Intel like, hey, we miss mobile.
47:24
What should we do about that?
47:26
Okay, let's ask the American people broadly at the ballot box.
47:29
like that that is the >> should Intel launch energy drinks.
47:35
>> Yeah, >> it's not really in our wheelhouse today, but you know, >> yeah, >> big potentially large opportunity.
47:41
>> Yeah, it just it does seem it does seem fraud.
47:43
It it doesn't seem like it seems like they're there.
47:47
>> It's potentially one of the slipperiest slopes that we've ever been on as a country. >> Well, I don't know.
47:52
This is saying that like we're like like his point is that this isn't this isn't a step towards real socialism because it's not real control.
48:01
It's it's purely a financial instrument. >> Yeah.
48:05
But the Intel board said uh the government also agrees to vote with a company's board of directors on matters requiring shareholder approval with limited exceptions. What are those?
48:13
So what are the exceptions? Right.
48:14
Uh I'm not sure not sure that we know.
48:17
But anyways, the timeline >> the analysis says it's a bad idea. We can vote against you.
48:22
And that's the exception.
48:24
Anyway, uh first step I would vote for if I was uh a uh in in a democratic socialist society, I would vote that Intel gets on graphite.
48:32
dev code review for the age of AI.
48:34
Graphite helps team is on GitHub ship higher quality software faster. Get started for free.
48:41
Canor in the chat says, "I think Intel needs to launch short form content."
48:45
>> Well, uh make sure your voter registration is up tod date because uh President AOC might just make it happen. You never know. >> I could see it. I could see it. >> Possible.
48:54
Um I mean the the the real wild one is yeah Tesla because Tesla's had uh a number of government incentives that they've taken advantage of.
49:03
You could make the same argument.
49:04
You put the screws to them and you say hey we need we need voting shares for this >> for the years and years.
49:11
>> This is what Andrew Andrew Sorcin was saying.
49:12
He was saying like yeah like where like where do you stop?
49:14
And I understand that yeah, there is this like slippery slope, but uh to Bill Gurley's point, like Intel could have said no.
49:23
They could have said like, "Yeah, we're actually going to be fine without the chips act money."
49:26
And so we don't want we don't want an equity stake.
49:29
Although >> Bhutan is sitting there just on fire and you should be like, "You don't need to help.
49:36
You don't need to help put it out. I'll be good. I'll be good."
49:37
The flames are just >> like, "No, I'm I'm good. I'm good. I'm good." cut more.
49:44
>> He's like, I don't want to I don't want to give I don't want to give the president the ick.
49:47
I'm just act all like, >> hey, I mean, Blackberry is a cyber security company now.
49:51
Maybe Intel just like pivots all the way down to just like, yeah, we we actually just own real estate at this point.
49:57
Like, like all we own is we're real estate and we just lease to uh TSMC and that's it.
50:02
We're we're completely out of design.
50:08
In other news, Taylor Swift is getting married.
50:11
Um, >> the private jet enthusiast.
50:14
>> Well, I I feel like most of our audience would know her for her Wall Street Journal op-ed in 2014 where she said for Taylor Swift, "The future of music is a love story."
50:24
Uh, where will the music industry be in 20, 30, 50 years before I tell you my thoughts on the matter?
50:29
You should know that you're reading the opinion of an enthusiastic optimist, one of the few souls. Yeah.
50:34
One of the few living souls in the music industry who still believes that the music industry is not dying. It's just coming alive.
50:43
There are many, many people who predict the downfall of music sales and the irrelevancy of the album as an economic entity. I am not one of them.
50:49
In my opinion, the value of an album is and will continue to be based on the amount of heart and soul an artist has bled into a body of work and the financial values and the financial value that that artists and their labels place on their music when it goes into the marketplace.
51:06
Piracy, file sharing, and streaming have shrunk the numbers of paid album sales drastically.
51:10
And every artist has handled this blow differently.
51:12
In recent years, you've probably heard the articles about major recording artists who have decided to practically give their music away for this promotion or that exclusive deal.
51:21
My hope for the future, not just in the music industry, but in every young girl I meet, is that they all realize their worth and ask for it.
51:28
Music is art and art is an important is important and rare.
51:31
Important, rare things are valuable.
51:33
Valuable things should be paid for.
51:35
It's my opinion that music should not be free.
51:38
And my prediction is that individual artists and their labels will someday decide what an album's price point is.
51:43
I hope they don't us underestimate themselves or underestimate or undervalue their art.
51:51
>> So, did she get this right to date? Not really.
51:55
I think she I think she got the thing that she got right is that what an album is can be extremely monetized if you continue to think about what the like the album is scarcity.
52:09
Like you either have it or you don't.
52:12
And the internet kind of reduced that scarcity to zero because you could stream it, you could pirate it, but there is still scarcity to be created if you are an artist, if you are a musical artist.
52:23
And so the way she does that now is when she releases an album, she goes on a tour that becomes so big that again there is scarcity because there are only so many tickets at Sofi Stadium and you have to be there because it's a moment >> one of the best monetized. >> Yes.
52:41
>> Recording artists of all time. >> Yes. Yes.
52:42
And so she gets the long tail eventually and eventually her her music is essentially free and played in uh in grocery stores.
52:50
So, I'm going to read you something from their Instagram caption announcing the engagement. >> Yes.
52:56
>> It's not just a marriage. Dash M Dash.
52:59
It's the perfect love story. >> No way. No way.
53:04
>> Back on X is calling this out saying uh claiming that Taylor and Travis are oneshotted. >> No way. >> What you got, Tyler?
53:12
Was that >> Oh, well, I was going to say something about like her like monetization like um Kyla Scan has this good post.
53:17
She said, um, Taylor Swift's engagement is actually very relevant to monetary policy because she is the most powerful stimulus tool we have. >> Oh, really? How so?
53:27
>> Well, I mean, her her tours are like massive.
53:29
Like you can see the like rise >> in consumer spending. Yeah. >> Oo, interesting.
53:33
>> Especially like smaller countries, it's like very notable. >> Yes. Yes.
53:35
But but how does her being married like she could just go on tour and be single, right?
53:40
Is she going to sell more tickets because she's married now?
53:43
Does it allow her to tour more?
53:43
Uh you could also see it in uh a lot of people are talking about birth rates, right? So maybe a new boom. Yep. >> Baby boom.
53:51
Catherine Bole just posted a picture and just said with the capt captioned >> their picture pictures just said American dynamism.
54:01
>> I do think this will be good for the birth rate.
54:02
It's it's also going to be uh some some uh for anybody that's in a longer term relationship in their late 20s, early 30s. Pressure is now on.
54:12
These photos are going to be getting sent around.
54:13
They're setting a new bar, right?
54:15
Uh quite the floral display by Travis.
54:19
Got to give them props there.
54:21
>> How many uh how many kids do you think she'll wind up having? >> She's 35. >> She's 35.
54:28
>> She's got to get going. >> Oh, yeah. 198.
54:30
>> And uh hopefully a ton, right?
54:30
I mean, I think we'd like the >> last luxury status symbol apparently.
54:37
>> Like to see at least 10. >> Yeah, it' be great. >> Oh, wow. >> Wow. Looking sharp.
54:41
You really you really undersold this.
54:44
You said you were just going to do a phone call and now here you are.
54:48
>> No, I thought I the full monty here cuz >> this is amazing.
54:51
Okay, so first off, I need to apologize.
54:53
I completely botched the story of dr. com.
54:55
In my defense, I believe I was 10 years old when I stopped by the office as a as a kid.
54:58
Uh but please break it down for us. >> It's so funny.
55:03
The the only thing I found disturbing was how how miserably you did with my credentials. >> Oh, I'm sorry. I'm sorry.
55:10
>> Let me start with that. Okay. >> I'm a physician.
55:11
I'm a board certified internist.
55:13
I'm a boardcertified addictionist.
55:15
I'm a fellow with the American board college of physicians.
55:19
I'm got mult I was assistant clinical professor of psychiatry practice medicine my whole life. I'm not a psychologist. >> Okay.
55:24
Yes, >> we did do love line back in the day. >> I love Line.
55:26
I I sincerely love Loveline.
55:29
I wish I listened to it constantly. It was amazing.
55:32
>> Well, it it was very popular and it served a function back in the day.
55:33
But but this this business spun out of it.
55:35
I thought you guys would really like to hear this history because it is a piece of history. >> Incredible.
55:42
>> U good friend of mine from high school, Polytechnic High School. >> Yeah.
55:47
>> We we went off to Ammeris College and then he went to Harvard Business School.
55:51
I went to medical school and uh I'm going along doing all these wild things.
55:55
Uh practicing medicine and then doing radio and he shows up and he goes, "I want to I want to show you how to form a business.
56:01
We're going to do a com company."
56:02
And of course, I was hearing about all the dot stuff in the in the wind.
56:05
And he got some seed capital from a company in Orange County, like a million dollars.
56:12
>> And then he put together a little board and we went he grabbed me by the arm and took me up to Sand Hill Road and we sat at Softback Soft Bank rather >> and made he just said, "Follow me."
56:20
I go, "What are we doing? What are we?"
56:23
I had no idea what we were doing.
56:25
Didn't know how to start a business.
56:26
I didn't >> Had you had you bought your. com by the way?
56:30
had you like gone out >> probably had done something at like that at that point.
56:34
I don't I don't think we sitting there without that. >> Yeah, exactly.
56:39
>> And uh and he just goes, "Follow me." And I was like, "Okay."
56:41
So I followed along and they go, "What do you want to do?"
56:44
And I'm like, >> you know what?
56:48
So, I sort of I don't remember what I said, but uh the six or seven soft bank VC representatives marched out of the room and uh my Harvard Business School friend was anxious and like I didn't even understand what was happening. Still, I did not.
57:02
And they came back in and they go, "Okay, $10 million." And that was that. >> Let's go.
57:11
>> We went down and we built the company exactly as you described it.
57:13
And in fact, it drove my wife crazy.
57:15
She goes, "What are people doing here?
57:17
Why aren't they why aren't they working there?
57:18
We shouldn't It shouldn't be this nice an environment."
57:22
But most of that was for the tech team.
57:24
And you pointed out how weird the tech situation was.
57:26
You got that part exactly right.
57:30
>> But the part you got wrong is >> remember people didn't have any idea what a website was. >> Yeah.
57:37
And so we had an editorial staff, we had a medical staff, we had a marketing team, and they envisioned I kept saying, "Why do we need a magazine on my computer screen?
57:47
Why why you're you're building this really great magazine >> but with a chat room and with some feedback and they kept they all the all the all these sort of trigger words back then were interaction." Sure.
57:59
>> Uh and and I didn't understand.
57:59
I I saw no value in any of it.
58:02
I kept saying I I I kept and we we had 120 employees and we had a board of directors from from Northern California who were demanding we uh quote get big fast.
58:13
This this is interesting. >> Get big fast.
58:18
>> This guy this I I came to our first board meeting.
58:20
I said, "Look, I I'm trying to decide if um we should figure out how to make money, how to make this profitable or or what we should be doing or how to, you know, >> did they tell you don't worry about that. Don't worry about that."
58:30
Worse than that, this one guy goes, "If" He was manic as hell and he goes, "If I thought you were so stupid, I never would have been on this board."
58:37
And he jumps up and he goes, "Here's how you make money at company."
58:40
And there was a giant whiteboard and he wrote in huge letters, "Get big fast."
58:49
>> And they were demanding we burn through capital faster to try to get big fast.
58:54
So that became the weird, it was the weirdest thing I ever seen in my life.
58:58
But the one thing I got right, >> I kept saying, "It's gonna be video.
59:00
Why else do we need this thing? It's going to be video."
59:04
But look, look what we're doing right now. Right. >> Yeah.
59:07
>> And I just kept saying that.
59:07
And we put together a one night a week television show. >> Yeah.
59:13
>> That was really a high quality show.
59:13
We still have some of the tapes from it. And everybody came in.
59:16
Paul Rudd, uh, Tommy Lee, everybody came in on that one night a week show because it was the cool thing to do because there's this new idea. This.
59:24
com company creates a TV show and nobody could watch it. Do you know why?
59:31
>> Cuz you couldn't stream it.
59:33
>> Because nobody had stream. Nobody had broadband. >> Yeah, >> broadband.
59:38
You needed broadband back then.
59:40
That's that's how far ahead of the technology we were. >> How were you guys?
59:44
It sounds like you weren't making a ton of money, but were you selling the show on a subscription?
59:48
Like what what did that >> was the was there any business model ads? No, >> just eyeballs.
59:54
But so, so get big fast didn't mean revenue or profits. It meant eyeballs. >> eyeballs.
1:00:00
Get big meant money meant number of people.
1:00:02
And they kept talking about how the cur, you know, how the asetic curve would develop around >> viewership and and engagement and this kind of stuff.
1:00:09
And we literally this was a company I mean had lots of traction and engagement and stuff.
1:00:16
People were kind of intrigued by it.
1:00:16
So people were stopping by and looking at this thing. I I not sure.
1:00:20
We did lots of interviews with celebrity.
1:00:23
It was sort of like >> E meets uh teen B meets, you know, it was all these different things uh all together in one site.
1:00:31
And uh we literally were sitting in Goldman Sachs on I believe it was March 19th uh 20 20 2010. Wait, when was that? Sorry, 1989 or 2000.
1:00:47
The day the NASDAQ fell apart, we were sitting the day we were sitting in Goldman Sachs and the woman across the table was contemplating giving us $30 million on a $110 million valuation for a company that had never made a penny. >> Wow.
1:01:05
>> And I I I just thought it was the dumbest thing I ever saw.
1:01:07
But I I I knew it was tulips the whole way and I kept and one friend of mine finally goes, "Look, it's Amsterdam 1680. It's tulips.
1:01:16
you going to grow Brussels sprouts or you going to grow tulips?
1:01:18
What are you going to do?
1:01:19
I thought, all right, I'm I'm going to grow tulips.
1:01:22
>> Well, it's I mean, it's interesting to think back and if and if if if it was structured as an investment that was actually in you and your name and likeness, it would have been a tremendous investment, but that wasn't a good dot story.
1:01:36
>> It it was why we got the money though.
1:01:38
Uh, in fact, there's there's an inc here.
1:01:41
I was going to actually pull down and wave in front of the camera, but it'd be almost impossible to do it.
1:01:44
Uh, were that they were sort of saying that's what they were, you know, that's kind of what they were thinking they were doing, but it was not it was not a clear thought, but they were looking for brands. >> Yeah.
1:01:56
>> And I don't think they really knew that that that was not a fully developed thought at that time. >> Yeah.
1:02:02
>> Um, >> so what was what was the conclusion?
1:02:04
>> I was like going to business school.
1:02:04
I saw the entire the entire from from seed to dissolve.
1:02:08
I saw the entire business cycle in one year.
1:02:13
>> So did you did you eventually take take over the site again yourself or what? >> Dr.
1:02:17
Coupe brought bought the site. Remember Dr. Coupe or you wouldn't. You're too young.
1:02:21
He was the attorney general and then he had a website that actually did rather well for a minute.
1:02:27
>> Did he just redirect the website or was he still using drt. com? >> No. No, he was a redirect.
1:02:31
Absorbed everything >> and and um and he went bankrupt as everybody did. >> Yeah.
1:02:41
>> And we got we were able to weasel it back.
1:02:44
I forget how we got it back, but we had to we had to do some sleuththing and we finally got it back. >> So, yeah.
1:02:48
What what what how did the shape of your business evolve then?
1:02:50
And like what uh like how do you think about packaging everything that you do now?
1:02:59
Um, you know, there there's I was listening to you guys talk and I was thinking, boy, I don't have any framework.
1:03:05
>> This is all very interesting to me, but but I don't have a framework to sort of understand what I do.
1:03:09
My stuff is always an improvisation. >> Sure. >> Right.
1:03:12
I when I started radio in 1983, I had no designs on radio.
1:03:15
I I was leave me alone so I can practice medicine.
1:03:18
I'll come here in the evenings on Sunday and do community service.
1:03:20
That was my little notion in 1983 when I started doing radio.
1:03:27
Then some television guys came along.
1:03:28
I'm like, "How do you do a TV show?
1:03:28
I've never I don't even know what you're talking about."
1:03:32
Well, this was the same thing with the my good friend comes to me and goes, "We're going to do this."
1:03:37
And I thought, "I I don't see it.
1:03:37
I don't get it, but I think we might be able to do something with it. It' be interesting."
1:03:41
It was a hell of an education.
1:03:44
>> Um, and uh, and you're asking how I frame everything I do now.
1:03:48
Now yeah, I was wondering how >> well it's just been interesting how many techn how many different technology trends from the to you know podcasting but it all comes back to basically radio and TV. >> Yeah.
1:04:00
Like like what over over the past uh you know more recent tech boom history have you been hit with the hey let's do uh let's do a Drew >> or let's do an AI thing.
1:04:10
Is this coming is it rearing its head again?
1:04:12
It >> that has been that has been I've had conversations like that. >> Yeah, of course. of course.
1:04:18
>> Uh exactly what to do with it, nobody knows, >> right?
1:04:22
>> Uh but it's part of the exploration.
1:04:22
Uh I'm doing streaming shows regularly.
1:04:25
You guys blasted them up there.
1:04:27
It looked like hell way you put it up there.
1:04:31
>> I'm going to talk to my web master.
1:04:33
>> I mean, it looks really good for conversion optimization.
1:04:35
It made me want to click.
1:04:37
So, I think I think you're doing a good job.
1:04:41
>> Not meant to be shown at other people's shows.
1:04:45
But um uh you know that's been interesting.
1:04:48
It it happened that all happened just because I got cancelled for daring to say people shouldn't panic about co >> Oh yeah.
1:04:55
>> And uh that caused me to just stop doing everything.
1:04:58
And I had somebody who said, "Hey, you should do a streaming show."
1:04:59
I was like, "What's that?"
1:05:00
Again, that's sort of my it's where I start every one of these projects. >> Yeah.
1:05:05
You had a bad experience streaming the first time where you're like, "If if I make the show, you're sure people are going to be able to watch it?"
1:05:10
But >> well, no more confidence this time. I I knew it. I already knew that. I already knew.
1:05:17
I saw what was happening with videos.
1:05:18
I just kept we just kept saying we were so early.
1:05:20
We just we we could have been who knows what. We could have been you.
1:05:23
God knows we could have been YouTube or something if we had sort of been the first to really advocate for this kind of platform.
1:05:28
But we were way early and nobody else was quite as much of a believer as I was.
1:05:32
And uh so the streaming thing has been very interesting.
1:05:38
And you just I'm in my own my kids' playroom doing this and it's the it's the same thing.
1:05:41
the it's the same thing. Everything here used to require me to go out to a satellite booth boo boo boo boo boo boo boo boo boo boo boo boo boo boo boo boo boo boo boo boo boo boo boo boo boo boo boo boo boo boo boo boo boo boo boo boo boo boo boo booth at CNN >> and now I just do it from here so the efficiencies are fantastic and so I do television out of the studio I do podcasting out of the studio I do streaming shows and it all started
1:05:58
because I got cancelled >> and some my web master said the streaming is probably going to happen pretty soon I said let's try that and uh I wanted to talk to all the pe other other physicians who had been cancelled >> one of them happens to be the director
1:06:12
of NIH right now and so I just sense that that these people had something to say and the cancellation thing was some sort of bizarre aberration certainly in in science and medicine. >> Had you have you gotten you know the the
1:06:23
>> Had you have you gotten you know the the opportunities that you maybe lost due to the cancellation have you gotten invited back in the last >> or is it just different set of opportunities >> or is it yeah are you looking at totally different or do you not even want to go back to the to kind of the old >> these these are great questions.
1:06:38
I I don't know that I want to go back, but I probably would because I've taken the position that my opinions have never changed.
1:06:46
I'm happy to express them on any platform anywhere.
1:06:48
Uh what has happened in the meantime is, you know, what I used to do say all the news outlets, all of them, all of a sudden the only people that would have me on was Fox. >> Yeah.
1:06:59
>> Uh now, just last week, CNN called.
1:06:59
So I thought, okay, good. This is a good sign.
1:07:05
>> I couldn't make it, but I would have had I been able to healing. >> Nature's healing. Yeah.
1:07:08
Um uh we've we we've been really obsessed with this idea that uh sort of a barbell is emerging in modern media where all the value either acrews to the platforms like YouTube, Twitch, Instagram or the individuals, the Joe Rogan, the Andrew Huberman, the crews and that it's very hard to actually build anything in the middle.
1:07:33
Um would you agree with that?
1:07:35
Would you is this something that you've kind of experienced?
1:07:37
Uh it it feels like something that um >> no I the I I absolutely concur with the on the talent side that because it used to be I would require to do what we're doing right now.
1:07:50
There'd be an executive producer.
1:07:52
There'd be a segment producer.
1:07:54
There would be a director in the studio in the satellite booth.
1:07:55
There'd be somebody directing in the other end at the satellite booth.
1:07:58
There would be >> and then you got the union the unions involved with >> there' be unions. There'd be sales forces.
1:08:04
There'd be executive structures. Now it's me. Yeah. That's it. >> Yeah.
1:08:08
>> So, it's so much more efficient and it drives that world crazy. >> Yeah.
1:08:12
>> So, when Colbear gets gets fired for losing $40 million a year, I just looked at that and I go, "Well, of course, >> that's going to happen to all of them.
1:08:20
This is just not a >> And our reaction at that point was he could just go set up his own home studio and probably have a fantastic business just with his existing fan base and none of the none of the overhead." >> 100%.
1:08:32
But they are they are You got to know how that world thinks. They're very spoiled.
1:08:37
They're very spoiled and they're used to gigantic infrastructure and dozens of writers and this is this the world we're living in right as we have this interview >> to them looks sort of cheap and dumb and people who aren't talented do that.
1:08:50
The real people people back back us with infrastructure and money that that just not so this the other side of the barbell which I'm wondering how you see it.
1:09:00
I just see it as largely nonviable.
1:09:03
So much of it has got to shrink dramatically and it's resisting. >> Yeah.
1:09:07
>> It's resisting like crazy. >> Yeah.
1:09:09
I mean, I I would almost put the the traditional media corporations like in the center.
1:09:13
When I think of the far big mega side of the barbell, I think of the platforms Spotify, Facebook, Meta, YouTube, Twitch, LinkedIn, the networks, and they actually acrue a ton of the value.
1:09:27
And and and it and it is extremely hard to start one of those companies.
1:09:31
And if you do, you're not talent at all.
1:09:33
In fact, you're probably an engineer and you probably at this point have the backing of like a state government because that's the only way Tik Tok got going was, you know, so much energy and capital flowing in to actually, you know, break through.
1:09:45
The ship has sailed on starting like new platforms for the most part in my opinion.
1:09:51
>> I think that's probably right.
1:09:51
And and there and they don't need to buy talent. >> No, not at all.
1:09:55
It just comes to them naturally and they give 50% of the revenue or whatever. >> Yeah.
1:09:59
We would rather we would rather just have you jump on our show from your studio. Yep.
1:10:05
>> And you benefit because people are going to trickle over to you and and uh their ads.
1:10:11
We just get to focus on making content and not not focused on talent.
1:10:16
>> But the interesting thing is you you have to wonder is there are we somewhere in a business cycle that's going to lead to some consolidation >> and when the talent consolidates are they going to start negotiating with the platforms?
1:10:28
Is there going to be some sort of >> I mean that would be a natural business cycle, right? >> Yeah.
1:10:33
What was that new uh left-wing Substack uh publication that just announced?
1:10:37
Uh they said they're libbing out or something. Remember this? >> Yeah.
1:10:41
What are the >> Anyway, there's like a collection the argument.
1:10:43
Uh so there's there's a new a new publication that's launching that's aggregating a number of writers who are sort of on the left.
1:10:51
And we were kind of debating will they have leverage over different platforms because they're all together or does it actually make more sense for Matt Eiglacius and Derek Thompson to just have their own substacks and go direct and then you know and then on the far other side is the is the platform and there's really no one in between.
1:11:10
But we're still early in the in this development of the the argument.
1:11:13
>> Well there there's something very strange.
1:11:15
It says there's a weird uh confluence of worlds right now. Yeah.
1:11:17
My son just texted me and he's >> he's been trying to get to you guys. I >> really know this.
1:11:27
>> Does he want to Does he wanna >> Does he want to hop on? We'll send the link. >> Yeah.
1:11:29
Yeah, we'll send you join right after you. >> Listening.
1:11:31
Uh maybe call my phone and I'll put you up to the uh microphone here. >> But he's Let's do it.
1:11:38
>> He's consolidating the ad department, you know, the the management, the the lawyering, the ad services, the distribution.
1:11:45
He's trying to consolidate that onto a tiny little team. Sure.
1:11:49
>> Because these things aren't nec all this stuff is not needed anymore.
1:11:52
>> You need you need an ad agency.
1:11:55
>> Yeah, this is amazing.
1:11:55
The the chat is going wild.
1:11:57
Everyone's really happy with this.
1:11:58
They're calling uh they're calling your son the prodical son. Question.
1:12:03
>> Well, he he I'm going to see if I get him to call me.
1:12:05
He said he emailed he his his partner named Jake emailed one of you guys. >> Okay. Okay. We'll have to follow up.
1:12:10
But uh >> they're having huge success and he's the one that he's the one that started talking about AI.
1:12:16
He's he's in the middle of all of this.
1:12:18
The tech influencers, the the Google store, the Tik Tok store, all everything. >> Yeah.
1:12:25
>> But all of that is more efficient, more efficient, more efficient. Yep. >> Right.
1:12:28
I mean, and the and what you have is these the the talent agencies and the ad agencies and the managerial services and the lawyers >> holding on.
1:12:36
They're like they're like going into the foxholes as opposed to adjusting and adapting and changing what what it is they do.
1:12:42
They are just insisting that things continue to be done the way that they've always been done.
1:12:48
And it's it's it's I guess a classic business mistake, right? >> Yeah. >> Totally. >> Yeah.
1:12:54
Um >> I have one I have one uh one one health one health question for you.
1:13:00
>> What are the uh uh John John and I are starting a what we hope to be multiple decades run of of uh daily live streaming.
1:13:10
uh what would you have done when when you were earlier in your career health-wise to um to better sell you know you you seem to be doing incredibly well now.
1:13:21
So what are what are the key things to look out for healthwise to make sure you can do this for decades.
1:13:29
>> Um be hypomomanic >> uh helps which which a lot of successful business people are. >> Yes.
1:13:36
>> You're going it's you know I I hear many of the podcasts you're going to suffer.
1:13:40
You're going to work hard.
1:13:40
you're going to lose sleep.
1:13:42
I wish id paid more attention to sleep, but if I had, I couldn't have done most of what I did.
1:13:48
>> I'm trying to pay attention to sleep now. >> Yeah.
1:13:51
>> And um you know, you've heard it all before.
1:13:53
It's it's not this is not new. Trust your instincts. Uh explore.
1:13:54
Don't be afraid to fall down.
1:13:56
I for me the the the big as I look back on all the things I did, it it just the willingness to improvise and to go into dangerous situations.
1:14:07
I mean, a lot of Oh, he's calling now. >> Let's get him on. We got the sun on.
1:14:12
>> I don't know if they can hear. He can.
1:14:13
I'll have to translate from you. >> Put on speaker phone.
1:14:16
>> Hey, how's it going, guys? >> How you doing? What's happening?
1:14:19
>> Son, obviously, but we um my business partner and I actually emailed you a couple weeks back. >> Okay. >> We rep Roberto Nixon. >> Oh, no way. I love that's amazing. Okay.
1:14:29
Yeah, we got to get in touch.
1:14:30
>> My dad was on the air with Fantastic.
1:14:33
I'm flying back from Seattle. >> Okay. Yeah. >> Okay. I do.
1:14:35
So, we did have a little exchange. >> Yeah. Yeah. Yeah.
1:14:37
Let's follow >> you guys.
1:14:38
He's going to keep talking. Okay.
1:14:40
He can't I'll tell him what you said. He can't hear you.
1:14:43
>> Good talking, Douglas.
1:14:44
>> I was going to say that I So Rob and Jake are going to an Oasis concert next week in Pasadena.
1:14:49
And I was going to ask you if you could meet Rob in Pasadena.
1:14:55
His sister also his her kids are going to Paulie.
1:14:58
>> And Doug went to Paul, too.
1:14:58
Doug went to Poly August.
1:15:01
>> Like you said at the beginning of the show, only famous people go to Poly Technical School. >> That's fantastic. >> Um, no. Hi.
1:15:09
I just wanted to say hi and uh show you that we're not like uh the rest of those guys that probably email you randomly asking for things and wanting to to build a relationship.
1:15:17
It's it's very funny that this all happened in a strange way.
1:15:21
So >> yeah, this is actually have to take a call for this name >> who's a Gen AI creator >> because he's in Dubai and I, you know, just trying to get on the >> You got to get on with Dubai.
1:15:32
We know we know how that goes. >> All right, get going.
1:15:35
And I I call these guys because they butchered my my uh my.
1:15:38
com and and I did get them.
1:15:38
He >> John is that which one's John? >> I'm John.
1:15:45
>> John John was actually at drdw.
1:15:45
com when he was like 10 years old. >> Yeah. >> Yeah.
1:15:52
I was in the very cold data center. Yeah. Okay. >> Racking servers. >> That's spectacular.
1:15:57
So there's there's a long history on on on all fronts. >> Andy went to Poland.
1:16:00
So okay, we'll talk later. >> Yes. Andy went to Pol. >> Amazing. Okay. Um, okay.
1:16:04
I I I have one more question on the health for you. For you. >> Okay. Sorry, Doug. >> Later, Douglas. >> Later.
1:16:13
Uh, for you, uh, last week we had Mark Cuban on the show.
1:16:15
He said that, uh, drinking raw milk is extremely dangerous and should never be done. >> Yeah.
1:16:21
I >> drank I I'll go on the record.
1:16:22
I drank a liter of raw milk every day for two years straight. You >> were fine. >> Yeah.
1:16:29
Uh why >> can you explain why >> he didn't he didn't give any underlying rational?
1:16:36
>> Yeah, I doubt he knows why.
1:16:37
>> He was just saying that that the LLMs might convince you to drink raw milk and that might lead to some sort of doom scenario.
1:16:46
>> You can get brucyosis, you probably get tulia, you can get listiosis and we can treat that with antibiotics, no problem.
1:16:54
>> Uh but they can make you very sick and they're very rare. >> Yeah.
1:16:58
Uh I I wouldn't do it but I don't the fact that pe I look >> there's something terrible going on. Yeah.
1:17:06
Where people are so fearful of being the biological agents that we are. >> Yeah.
1:17:12
>> And the reality that we are going to die that they are afraid to live. >> Yeah.
1:17:18
>> The living well is the goal. >> Not living forever.
1:17:21
Not living perfectly free of illness. It's living a good life. And we are off of that.
1:17:27
I can't >> We are so far off of that. It is disgusting.
1:17:32
And for a non-f physician to have an opinion about milk that contains pathogenic organisms that he's never heard of or learned to pronounce yesterday is disturbing to me.
1:17:41
It's the same thing when people went after hydroxychloricquin the day they learned how to say that word.
1:17:47
A medicine I've been prescribing for decades.
1:17:49
So it's all we are so out of whack with this going to live forever fear of death illness infection. Oh Yes.
1:17:58
We are we we my generation of physicians we walked into illnesses that had 100% fatality. AIDS had 100% fatality.
1:18:07
And we did not know what we were dealing with.
1:18:12
And we didn't cower in the corner. We marched in.
1:18:15
>> It's the right thing to do >> that.
1:18:17
I don't know what's happened.
1:18:17
I I can't understand this at all. But uh here we are.
1:18:21
We need to focus on living well, living a good life. Period.
1:18:26
>> Did you uh did you >> stuff comes what may?
1:18:28
>> Did you predict the decline of alcohol consumption? >> It's I did not.
1:18:33
It seems off a cliff, right? >> Yeah. Yeah. I did.
1:18:36
That's still surprising to me, but it fits with the lack of dating and the lack of having sex and the lack of socializing.
1:18:41
It it it that was that was a prime social lubricant for decades. I'm glad to see it. It's a good thing.
1:18:48
You know, the people are starting to understand it's a poison and it's not good for any tissue in our body ever.
1:18:56
>> But it makes me all so I mean >> what happens when did we become such When did that happen?
1:19:06
>> That's my question these days. When did that happen? >> I don't know.
1:19:09
I mean I' I've >> You can't Have you ever said something like that on CNN?
1:19:12
This is why you got to stay off the networks.
1:19:14
You just got to do your own show.
1:19:16
I I guess I'm I'm just I've been through so much lately.
1:19:18
I've just lost all uh I I'm a huge advocate for freedom of speech and freedom of many s I'm not happy about this flag burning thing.
1:19:30
We freedom freedom freedom is what I'm all about now speaking my mind.
1:19:34
>> I will pitch you one possible explanation.
1:19:36
Um I I think that the the fear of very you know consequential but low probability events um like the raw milk, the risk from raw milk or the risk from COVID uh is tied to a lack of belief in immortality uh and not in the sense of of living forever like biological immortality like science will cure this and let you live forever.
1:20:01
That's just one way to think about immortality.
1:20:03
You can also think about immortality in your legacy.
1:20:04
If you are written about and you have lived a great life, you will be remembered and immortalized.
1:20:10
You can also think about it through your children.
1:20:12
Um, and also through the the afterlife.
1:20:14
If you're spiritual or religious, you could think that you're going to heaven.
1:20:18
And if you don't believe in any of those modes of of of immortality, you don't believe that you're going to have kids or or do your life's work and be remembered in the afterlife or go to heaven or or you don't believe that science will be able to fix you if you do wind up getting sick from raw milk.
1:20:33
Um then even a small chance has the has an incredible incredible penalty and so you you discount it very very high.
1:20:40
Uh >> I I agree with you >> uh with a couple of caveats. I I do agree with you. >> Yeah.
1:20:50
>> Um embedded in that observation is a general lack of meaning making is that if the meaning is I'm trying to ascend to a after what whatever the meaning is of my living that meaning should be deeply meaningful to me and purposeful and doesn't it does not have to include an afterlife.
1:21:08
It can also include just creating a good life for my children.
1:21:12
That's why I'm here to do that that kind of thing.
1:21:13
But we people are here for their narcissistic needs and that's when things become >> fragile. >> Yes.
1:21:22
>> Because we we are not the beginning and the end of everything. We just are not.
1:21:26
And if we think we're all there is is what's happening to me. >> Yeah. >> Man.
1:21:31
And then we have people whipping the frenzies and the fear and they're learning to control us with that.
1:21:35
And that that is disgusting. >> Yeah.
1:21:39
So, what about um have you been tracking uh AI psychosis at all? Any any thoughts? >> I I hear about it.
1:21:47
I I don't I don't believe it.
1:21:48
I'll tell I'll I'll take I'll make a bet that that it's over way overblown.
1:21:52
It was somebody who's already psychotic and you know, whatever.
1:21:54
Um there not that the AI relationships are necessarily going to be good. I I I worry about that.
1:22:01
But this psychotic episode, I don't know.
1:22:04
I don't know if you remember back in the 90s there were news stories every night. >> I wasn't born sir. >> Okay.
1:22:11
Do you have to rub that in? Do you have to? You just said no. I don't remember. >> No. No. No.
1:22:16
Late later 90s I got into the action.
1:22:18
But uh >> but uh but there was news reports like every night like oh these parties where all the parents throw their keys in a bowl and they just they just grab a set of keys and that's who they go home with that night. >> Oh sure. the the press, the fake.
1:22:30
I don't think people were sensitive to fake news.
1:22:34
We have to be very sensitive to reporting these days.
1:22:37
So much of what's being reported is fake and it's just to catch your eyes.
1:22:41
It's just to get your attention.
1:22:42
They they the person that wrote that article was a 23-year-old segment producer somewhere who doesn't do any research of of any meaning.
1:22:51
It it just becomes something that they catch on the line.
1:22:53
They saw other people report it, they report it. It It's ridiculous. >> Yeah.
1:22:58
I mean the the my my read on it is is it seems obvious now that if a large number of people take Iawasa, some of them are going to have some type of psychotic break of sorts and and maybe they were prone to to or or had some some underlying issue that that enabled that.
1:23:22
that. that the issue >> you're right they already had a psychotic illness and they just happened to break when they were working with AI but you're you're raising you're you're making a very smart observation that the that AI world is populated by people that micro dose on acid and do Iaska
1:23:38
which >> I I tell you it categorically causes severe psychiatric problems I've seen it my entire career scares the hell out of me they should not be doing that >> if you're listening >> did you ever consider yeah if you're listening live from Burning Man Just listen to Dr. Drew. Did you ever go to Drew.
1:23:53
Did you ever go to Burning Man, by the way?
1:23:55
Doesn't seem >> No, we got friends keep trying to get us to go.
1:23:58
It's not It's not my jam. Exactly.
1:24:00
>> It's not my jam either.
1:24:02
>> Well, you could go there and try to try to, you know, talk people out of it.
1:24:05
>> How about we stick to the Bud Light, buddy?
1:24:07
>> Yeah, let's stick to crushing beers.
1:24:09
>> Have a couple glasses of wine.
1:24:11
>> Anyway, this has been fantastic for coming on the record. >> Come back on anytime. >> We appreciate this.
1:24:16
We'd love to have you back. >> You guys are great.
1:24:17
I I learned something just listening to you guys.
1:24:19
is talking about the playing the uh baseball cards. That was fascinating.
1:24:24
You guys have a great uh you're obviously extremely well trained in in your in your respective fields and it's very interesting to hear you talk about these various markets and opportunities and things and I leave with one caveat.
1:24:36
>> Please, >> if you don't call my son, he's going to kill me.
1:24:38
So, we will definitely >> We're gonna We'll go to this concert with him. >> We will. We will. >> Exactly. And it's in Pasadena.
1:24:42
If you come back, I live in Pasadena now. >> You live there now? >> I do.
1:24:46
I live over the Rose Bowl.
1:24:46
Rose Bowl is literally walking distance for me. >> So do I. >> Amazing.
1:24:53
>> Okay, we should just be my address, but I'll swing by for >> I'll bring you a 30 rack of Bud Light. >> We live by Annale. >> Oh, okay.
1:25:02
Yeah, I'm right over there. >> Okay. So, >> just up. >> No excuse.
1:25:07
>> I don't want to get too I don't want to get too too precise show up with people at my front door.
1:25:10
Anyway, thank you so much for hopping on. This is fantastic. Great hanging. >> We will talk. Bye.
1:25:16
Massive news from SpaceX last night. >> They did it. >> They did it.
1:25:20
Uh, flight 10 made it back.
1:25:24
Took off from Starbase, South Texas.
1:25:28
The, uh, the booster landed in the ocean in the I think the Gulf of America technically.
1:25:36
>> That's absolutely right.
1:25:36
And the actual Starship executed a successful flip maneuver, deployed a mock payload of a bunch of uh nonfunctional Starlink satellites.
1:25:48
Uh survived re-entry just barely, as we'll see.
1:25:51
It was a really dramatic video. It was amazing.
1:25:53
And then splashed down on target in the Indian Ocean. >> It was a full send. >> It was a full send.
1:26:00
It was It was a crazy crazy watch.
1:26:02
Uh yeah, let's watch the recap video that the Wall Street Journal put together.
1:26:07
This is pretty interesting. Starbase, Texas. This is yesterday.
1:26:10
They scrapped two attempts on Monday and Tuesday because of uh some some problems with the the vehicle, but they got it off the ground. Look at that. They lit the cannon. >> Stunning. >> Going to space.
1:26:27
>> And so >> I wish we could get a better sense for just how massive it is from those angles.
1:26:31
And so that those are the dummy Starlink satellites.
1:26:33
The dummy that little motor conveyor belt on the left. >> Yeah.
1:26:37
Just the number of things that have to go right to actually release something from this rocket is insane.
1:26:45
And then this is the crazy part.
1:26:45
There's just a bunch of different Where did the stuff come from? >> Just take a hit.
1:26:50
>> We clearly didn't need it.
1:26:52
>> You would think that as soon as I saw I was like, "Okay, it's over.
1:26:54
The whole thing's going to blow for sure." It does.
1:26:56
It definitely doesn't make it back >> because if it's like losing parts like every part should be important, right?
1:27:03
Like what's going on here?
1:27:05
>> Um, and so and they're also the whole time they were like testing the the flaps like really pushing them to the limits going farther.
1:27:11
There it is splashing down.
1:27:14
>> You were mentioning earlier there's a sound bite of them saying they were they were actually >> they were going further than they needed to.
1:27:19
So they were doing things like like okay let let's final moment >> and then boom >> and then the >> convenient cut.
1:27:26
You would have thought the journal and the legacy media would have let that happen a little bit longer of the massive explosion. >> Yeah.
1:27:33
I mean the vibes the vibes going into this were rough honestly.
1:27:35
Uh lots of people with the Elon's been distracted by politics take.
1:27:39
Lots of people with the Elon too focused on AI romantic companions take. Uh we covered that.
1:27:45
You can imagine the conversation between Eon and Anie yesterday, right before the launch. >> You got this, babe.
1:27:52
>> I mean, you know that uh you know that Anie uh apparently uh allegedly the uh the original Anie romantic companion model runs on uh the non-reasoning model, just Grock 3, I guess. >> Just pure love. >> Pure love.
1:28:09
and and if if there's any uh evidence out there in the just market of AI chatting and companions is that you don't need a reasoning model when you are chatting with a romantic companion.
1:28:20
So uh a lot of like the backlash to the GPT5 launch was something like uh you know people were using it not just as a romantic companion but just as like a life coach, somebody to talk to.
1:28:29
It was very conversational and that quick back and forth was what people actually enjoyed. They liked the tone.
1:28:35
They didn't care that it wasn't, you know, incredibly good at solving hard math problems or like the IMO or whatever.
1:28:43
What you got for me, Tyler?
1:28:44
>> I think there's also something to be said for like um reasoning models kind of mess with the vibes, >> right?
1:28:49
It's like it's like the music thing where >> um >> sometimes you want a friend that's not going to think too hard.
1:28:53
They're just going to in the musical um like taste thing, all the reasoning models gave like these weird answers because they would like subtly prefer, you know, artist names with numbers, stuff like that. Yep. Yep.
1:29:06
Although, I mean, I think the reasoning models actually had the best taste of all, but that's a bit of a hot take.
1:29:12
>> Well, we got to pull up this post from Red Bull Futurist. Very important. He says, "Super heavy. The effing goat." Wow.
1:29:19
>> And I just needed to highlight this cuz obviously Red Bull uh some of Red Bull Futurist work actually has uh into this, of course. So, absolute legend. A win for Red Bull. Really? >> For sure. For sure. Um, yeah.
1:29:33
>> I'm It's actually surprising that that uh Red Bull and SpaceX haven't tried to collab yet.
1:29:39
You'd think that Red Bull would just be like, "We'll give you millions of dollars if you just put Red Bull branding over this." Like, >> why not? It'd be good.
1:29:47
It'd be good for both parties.
1:29:49
>> Even the explosions are feel like on brand for Red Bull.
1:29:51
Red Bull's down for the crazy risk takingaking.
1:29:54
>> I could see Elon going with White Monster.
1:29:57
>> That would be really good.
1:30:00
>> They really should do that.
1:30:00
But I mean is special and maybe you don't want to delete that.
1:30:04
>> I mean are would you go so far to say the white monster brand isn't special?
1:30:09
Would you say I guess it would be added? Yeah.
1:30:11
Um they uh >> the reason I was bringing up the reasoning models was because apparently um uh Elon wanted Anie to use the reasoning model like the the the AI the AI companion has to be able to do the hard math problems which is funny.
1:30:24
So, so, so maybe maybe she really was uh in use uh making doing rocket science and and calculating the last uh final decisions before this uh this rocket went out, but it was a huge success.
1:30:35
Um the Wall Street Journal has kind of the playbyplay here.
1:30:38
Uh SpaceX p SpaceX pulled off a smoother test of its Starship rocket, managing a more complete mission after setbacks earlier this year.
1:30:48
The Starship uh spacecraft flew through space after launching from the company's South Texas complex Tuesday around 7:30 p. m. ET.
1:30:53
The vehicle successfully deployed a batch of dummy Starlink satellites and re-entered Earth's orbit facing intense heat and forces before splashing down in the Indian Ocean.
1:31:04
This was the 10th launch of Starship.
1:31:06
I believe this was the this was ship like 37 or something.
1:31:08
They've built a lot of these.
1:31:11
Uh not all of them have launched.
1:31:13
Some of them have been scrapped.
1:31:14
Um some of them blew up in the test stand.
1:31:15
They really push these things super hard.
1:31:17
So, it's a 403 foot tall rocket.
1:31:20
They started testing this in 2023.
1:31:22
There's been a series of explosions, mishaps, uh, previous test flights that have been cut short.
1:31:27
Uh, Elon Musk has much riding on the rocket envisioned to one day carry satellite, scientific devices, and eventually astronauts.
1:31:35
>> Just to put this into context, the White House is 70t tall. >> Wow.
1:31:39
>> So, this is >> Yeah, it's it's like the size of the Isn't it closer to the uh the Statue of Liberty?
1:31:44
I think it's like around that tall. 403 feet. I have to look that up.
1:31:48
Uh >> the Statue of Liberty is 305 ft. >> Absolutely.
1:31:53
Mog >> an extra 50 feet on that.
1:31:54
Uh for now, the company is pushing to show it can consistently fly Starship and experiment with its design.
1:32:01
Space up SpaceX set up Tuesday's mission to stress test parts of the Starship spacecraft.
1:32:05
We certainly saw that uh on display with the parts flying all over the place.
1:32:10
uh seeking to give engineers information to continue developing the vehicle.
1:32:13
Basically the the the the calculus here is like how cheap can you make this thing?
1:32:18
If you use you know duct tape will that work will if you use tin foil will work like they really are pushing these things like crazy crazy hard.
1:32:26
I think the other the other way to put this into context uh not everybody is fortunate to be able to launch uh build and launch rockets for a living but anybody that's built software knows that even if you're launching a relatively simple feature oh yeah >> it'll often times break and have issues and bugs and things like that and it's a little bit um you have a little bit more leeway to uh ship stuff and and make changes on the fly. Yep.
1:32:48
Um, in this case, they're doing it in this incredibly public uh setting where uh the internet is going to have a a very strong reaction one way or another.
1:32:58
So, the pressure is just insane.
1:33:02
>> So, uh uh Musk wants both the Starship booster and spacecraft to be fully and rapidly reusable, more akin to an airplane than a traditional rocket.
1:33:10
SpaceX has made major strides with reusability with its workhorse Falcon 9 rockets, which are powered by boosters that can be used many times.
1:33:16
SpaceX faces self-imposed and external deadlines with the much larger Starship.
1:33:21
Musk wants to launch an uncrrewed version of the vehicle to Mars next year, but has said meeting that goal will be tough.
1:33:28
Of course, there's a Mars transfer window that only comes up, I think, every 18 months or so.
1:33:30
So, it's really critical to hit it in 2026, or else you got to wait till 2028, I believe.
1:33:37
Uh, in 2027, a lander variant of Starship is supposed to be ready to carry astronauts on a NASA moon mission through the AY's Aremis exploration program.
1:33:46
That's going to be really hard because I think they have to refuel in orbit and then also make it safe enough that astronauts can fly on it.
1:33:51
Like they have a lot to do there.
1:33:54
>> This is why we need to get Anie to be able to solve complex physics. >> For sure. For sure.
1:33:59
>> Today we are talking about Laboos and the story of PopMart, which to me really stands out as a similar like in the dot boom there was this uh the Beanie Babies went on a similar run.
1:34:10
incredibly popular, built on the back of. com technology.
1:34:16
I remember going over to a friend's house and loading the beaniebabies.
1:34:20
com website and it was so heavy because it had all these images.
1:34:26
>> Did it take like minutes to load?
1:34:28
>> It took minutes to load because they like whoever built the website just didn't kind of think about how long it would take.
1:34:36
>> But even then it was like this is so cool.
1:34:38
Yeah, it takes 30 minutes to go to the store. >> Exactly.
1:34:41
Oh, if it takes 5 minutes to load all down.
1:34:43
And so, yeah, the page would load, the HTML would load, and then slowly one image after another would load in.
1:34:48
Um, and you could really feel the difference.
1:34:50
At the time, many people were on dialup, which was 56k, which is like a staggeringly slow speed compared to what you get even just on like a plane.
1:35:02
Um, and then DSL was one level up.
1:35:06
posted uh posted that United has Starlink now. >> Yeah.
1:35:09
And I think it's 300 megs per second. 300 megs.
1:35:12
So that's that's what uh 6,000 times faster than what we were experiencing back in like the mid90s. >> Yeah.
1:35:20
And so um then you could upgrade to DSL.
1:35:24
DSL was between 256K and 1. 5 megs.
1:35:28
Uh I had a friend who had a T1 line which was like enterprise level internet in the 90s.
1:35:32
It was one meg up and down.
1:35:34
So you could get equal upload symmetrical line.
1:35:37
Um, and he could still he could load the Beanie Baby website faster than anyone.
1:35:41
It was like true status symbol at the time. Yeah, it was alpha.
1:35:46
His parents were very successful.
1:35:48
>> What was the the the most expensive Beanie Baby transaction ever? Do you know? >> I don't know.
1:35:53
I I do know that prices peaked uh throughout just they perfectly track the do boom.
1:35:58
So in two in 1998 uh Tai which is uh Tai Warner his company is called Tai uh Ty they make Beanie Babies. They made $1.
1:36:08
4 billion in sales making it one of the fastest growing toy companies in history.
1:36:13
Two years later the market crashed almost overnight.
1:36:17
Prices on the secondary market plummeted as supply overwhelmed demand and speculative buyers exited.
1:36:21
So people were in the habit of um >> and yes in the chat is correct.
1:36:26
Uh eBay was a major major driver of uh Beanie Baby's growth because people could buy them and then the secondary market was way more liquid than ever before.
1:36:36
Before it was like, okay, if you buy some some rare drop or some limited edition thing and you want to go sell it, you have to go to like a trade show that maybe happens every once in a once a once a year.
1:36:49
You have to find maybe your local shop, but there's not that much liquidity.
1:36:52
Remember when we were talking to our friend about the uh the the the the collectible card market, Beatles memorabilia?
1:36:59
He was saying like, "I only need two buyers."
1:37:01
It's very easy to find two buyers if you're if you're if you're interacting at internet scale. Totally.
1:37:08
>> It's harder if you're in some town and you have a rare Beanie Baby and you need to see are there any other crazy Beanie Baby fans in this town. So eBay was a huge Yeah.
1:37:17
Beanie Babies, the original or unicorn startup essentially.
1:37:20
I mean, it was it was an overnight success in the sense that I think the business was gone for about a decade uh before the boom, but they rode the wave of the internet.
1:37:29
>> Interestingly, most expensive labu ever sold was 170,000 >> in June of this year. >> Yep.
1:37:36
>> And the most expensive Beanie Baby ever sold was something around half a million. >> Half a million. Oh, we got room to run.
1:37:46
We got room to run in the Libu market.
1:37:47
So, my question is like, what is driving the Leubu? Uh, yeah.
1:37:49
Aiden, uh, enjoy your victory lap.
1:37:53
Get get out there, get some exercise.
1:37:55
Uh, do some push-ups halfway through the lap. >> Aiden, >> enjoy it. >> Belt ski.
1:37:59
>> Um, >> did we say that right? >> Uh, Beltskis. >> Yes, >> Beltskis.
1:38:04
>> You said your full name now. There we go. >> Thanks for watching. Um, the Yeah.
1:38:05
So, Libu clearly uh clearly a beneficiary of the social media boom of Tik Tok of the unboxing culture, Teimu culture, live shopping culture, flex culture >> because you people put them on, you know, their their purse.
1:38:23
>> Interestingly, not even though it's like it's like money is cheap right now, everything is going up and to the right.
1:38:29
Um the market is booming.
1:38:32
I I can't find a Yeah, I can't really find a bridge between like the AI boom and the and laboo.
1:38:38
It seems like it's just the social media boom that we're continuing to see.
1:38:42
Yeah, >> it's the fart coins, the laboo. >> Yes. Yes. Yes. Yeah.
1:38:45
There's a little bit of that.
1:38:47
bit of that. There's a little bit of just like gambling culture has has infiltrated everything from sports betting obviously is being is legal in more states and and and has been on a tear for a long time to folks been gambling on crypto and stocks and out of
1:39:04
the money options all the way to um you know the the uh collector culture on all sorts of different platforms like there's a big there's just a broad boom happening here and then there's also the China angle which I think is interesting. Um, we were talking about
1:39:18
Um, we were talking about this yesterday that China hasn't had a major cultural export.
1:39:22
Um, and this might be sort of the first one more or less.
1:39:29
Like Tik Tok counts in some ways, but Tik Tok I see it as like a bucket that fills up with the local culture of the people that open the app.
1:39:35
Like if you're in you're in LA, you see LA town when you go >> Yeah, exactly.
1:39:41
whenever you're >> But you can certainly access that if you wind up in that filter if you search the right keywords and then you can go there. Yeah. Yeah. Same with Instagram.
1:39:49
But by default, I don't see Tik Tok as like a uniquely uh a uniquely Chinese cultural export.
1:39:55
>> It's an export, not a cultural export. >> It's a technology.
1:39:57
It's a technology and and of course like uh China has been exporting like manufacturing technology and manufacturing prowess for a long time.
1:40:04
And so my >> and got a got a real win with the demon dolls.
1:40:09
>> They do look crazy, right?
1:40:09
I just I don't like them.
1:40:11
I I They just rub me the wrong way. I I don't know.
1:40:14
They're Something is weird, but I'm just not into it. I don't know.
1:40:20
>> That's why we bought one for Bill Bishop's dog.
1:40:22
We're We're excited for Tashi to rip it apart. >> Rip it apart. Yes.
1:40:26
It It feels It just It's not a good look.
1:40:29
I don't like the aesthetics at all. It's very odd.
1:40:32
Anyway, >> not buy one for my child.
1:40:35
>> The bigger question that I have that I think we want to answer.
1:40:37
So, we're going to dig into the history of PopMart, take you through some of this the history of Laboos.
1:40:41
The the question that I have is like the the horse is out of the stable with like gambling on toys clearly.
1:40:46
Um, think about the Tik Tok story.
1:40:52
There was a big discussion, nationwide discussion a few years ago. Should we ban Tik Tok? Is it spyw wear?
1:40:58
Is it influencing our culture? Is it causing brain rot?
1:41:00
Where did we land on that as America?
1:41:02
We said, "Nah, it's fine. we're good.
1:41:05
"Nah, it's fine. we're good. The answer was uh YouTube will compete in shorts and uh Instagram will compete in reals and you know Tik Tok will be out there and you know buy or beware like you know what you're using and you're an American you're free person and if you want to use that app you can and if you want to
1:41:24
come over to a different app and you trust uh Mark Zuckerberg >> stated field preference people are like I just want to follow my friends the the you know feeds that are algo driven get used more >> and my my pitch and what I'm what I'm kind of digging into, what I wrote about in the newsletter this morning, you should subscribe at Substack uh to our substack >> tbn.substack substack >> tbn. substack.
1:41:44
com is um is the conclusion to the Tik Tok debate was the YouTube team and the Instagram team need to launch direct competitors and take it very seriously.
1:41:55
And Mark Zuckerberg invested like tens of billions of dollars I think in like data center buildout to actually support reels and the algo feeds and they took it really seriously and they executed very well.
1:42:05
Um, so what's the conclusion to the Luboo story?
1:42:07
Well, it's probably like Tai, the maker of Beanie Babies, or Mattel, the maker of Barbie, >> getting into blind boxes. Yeah.
1:42:13
Like that's the only answer that that's the where the like the arrow of progress moves by one direction. They want to gamble.
1:42:22
And so I think that that's the end state here.
1:42:24
And I'm just I'm I'm that's the situation that I'm monitoring.
1:42:28
I'm not holding my breath being like, "Oh yeah, Laboos are going away anytime soon." Yeah, sure.
1:42:32
There might be like a bubble and then it subsides.
1:42:35
But in general, I think that the future is like more mystery boxes under the Christmas tree.
1:42:41
Generally, broadly in American culture, like we love gambling. We love freedom. Pick your poison.
1:42:46
That's >> why somebody gambling is a gift is crazy.
1:42:51
>> Like I bought you this blind box.
1:42:52
>> You never give someone scratchers. Give someone scratchers. It's great.
1:42:56
>> We should give the team scratchers.
1:42:56
Send them off into their three-day weekend.
1:42:58
I bet everybody was like, I'm I'm into scratchers.
1:43:02
I I had a friend in uh college who was into scratchers. >> Really?
1:43:06
>> You know, the thrill of a scratcher.
1:43:06
I bought one lot ticket in my life and it was electric.
1:43:10
I was like, I'm going to win.
1:43:11
Like, this is going to happen. And then it didn't.
1:43:13
And I was like, okay, I'm never spending $2 ever again on that.
1:43:16
Um, but uh anyway, this is what happened with video games.
1:43:20
They went free to play plus uh microtransactions.
1:43:23
The whales drive everything.
1:43:23
Price discrimination and everything.
1:43:25
We see this with uh Only Fans.
1:43:27
We see this with the future of uh Romantic Companions.
1:43:32
Um, price discrimination is key and this will probably unlock some of that.
1:43:35
Uh, it'll be interesting to see where it goes.
1:43:40
But, um, I think if you're a toy maker, you got to get into mystery boxes.
1:43:44
Um, unfortunately, maybe maybe unfortunately, but like that's where the that's where the culture's moved, >> late stage capitalism >> pretty much, >> which I would say we're just getting started >> pretty much.
1:43:55
Anyway, let's go through uh Brandon Guell has a fantastic thread on uh on PopMart and Tyler has uh the uh the story here.
1:44:05
>> Do Do you want to take us through the history? >> Yeah.
1:44:07
>> Tyler, what you got for us?
1:44:08
>> Can we pull this up on VHS, Ben?
1:44:08
I think this is this is going to be important. >> There we go. >> There we go. Clear as day. >> Oh man. Yeah.
1:44:16
>> So, I think we should >> I just love the way this looks. >> I can't help it.
1:44:20
>> Okay, let's first go through some big big numbers here.
1:44:22
So PopMart public company currently at what like around 55 billion >> Hong Kong market >> Wong Ning is now the 10th richest person in China. He's worth $28 billion. Wow. Pretty pretty crazy. >> Credit is due.
1:44:40
>> And uh a lot of these a lot of the data sources here are Chinese and we tried to double check everything by translating but uh there might be some details that are wrong. No. Yeah. >> Okay.
1:44:49
So, yeah, they have uh almost 600 retail stores, 200 uh vending machines, revenues at 1. 8 billion. >> Vending machines. That's massive.
1:44:58
>> That's really the big thing that that was big.
1:44:59
Um it kind of So, the kind of main story of PopMart is that they basically took a lot of things that were uh first in Japan and then brought them to China and then exported them basically worldwide. >> Yeah.
1:45:10
>> Um but yeah, the revenue is 6% growth year-over-year and then 700 million of that is just overseas. >> Yeah. The stat was crazy.
1:45:16
I think in the first half of this year, they beat last year's total revenue. >> Yeah.
1:45:22
>> And they're already like a scaled pretty huge company. >> Is that good?
1:45:26
>> It's uh I think it's better than Nvidia.
1:45:29
>> It's the backbone of the economy. Okay.
1:45:32
So, take us through some of these. >> Yeah.
1:45:33
So, 2010 um in Beijing, Wang Ning starts it.
1:45:37
>> Um originally, basically, it's just like retail store for these little collectibles.
1:45:41
Um they don't there's a bunch of stores um that do like license other people's IP.
1:45:46
So there's like uh I think they originally started with some marble. >> Okay.
1:45:51
>> Um >> but then really the I mean the majority of the revenue is just from like their custom IP that they basically license from artists they find. >> Yeah.
1:45:59
So that's the nature of like pop mart like it's like pop culture market and uh Brandon says uh started as a single variety mall store.
1:46:07
Think Spencer or Hot Topic.
1:46:10
uh couldn't get they couldn't get investment at the time because no one thought adult toys would work.
1:46:15
Now he's the 10th >> and when Wang was growing up his parents ran small shops so it was in the DNA >> family. Okay. >> Yeah.
1:46:23
So then 2014 this is when uh they basically bring over these sunny angels.
1:46:28
These are the Japanese like figurines.
1:46:28
Y um and this is when they they start the blind boxes.
1:46:32
This is like really the main thing that spurs the rest of their growth. >> Yep. >> Um 2015.
1:46:37
>> Wait wait wait before this this is this is actually crazy.
1:46:38
Brandon has some extra context here.
1:46:39
starts the company in 2010.
1:46:41
A year out of college, uh he had an undergraduate degree in advertising and a short stint at the Chinese version of Twitter.
1:46:46
His single variety store in Beijing in a Beijing mall.
1:46:51
It's essentially a reseller.
1:46:51
His seven employees spends two years selling third-party stuff on thin margins trying to scale with debt, but he's it's hard to finance because investors don't get selling toys to adults.
1:47:01
He manages to raise $320,000 equivalent in uh in R&B uh and then $1 million around there in 2013, which he opens to use uh which he uses to open three new mall shops.
1:47:14
Uh and then in 2014, he hits his first lick uh finds a repeatable format blind boxes. So take us into that.
1:47:23
>> Okay, so then so they start with that.
1:47:25
These are still uh different figurines from Japan.
1:47:27
Yeah, these Sunny Angel blind boxes that look kind of like '90s troll dolls. Interesting. >> Yeah. And then >> Yeah.
1:47:35
And and I don't think we already we covered specifically what a blind box is.
1:47:38
It's you're going in, you're you're paying a a a generic price for something and you have no idea what's in it.
1:47:43
It could be this super generic one of, you know, a 100,000 item or it could be ultra ultra limited.
1:47:50
And so you just get this massive uh buyers get this massive dopamine rush when they're buying it.
1:47:57
they're paying and and that whatever item they unpack might immediately be worth like some significant multiple of what they paid. Y >> Yep.
1:48:04
Kind of like angel investing.
1:48:06
>> So it has it has uh Yeah.
1:48:06
But but way more condensed.
1:48:09
It's like I buy this and then I immediately figure out am I am I going to get >> $1,000 in 10 cap?
1:48:15
>> But unlike angel investing, I think there's like a floor, right?
1:48:17
Angel investing you easily go to zero.
1:48:20
>> Laboo is like have you know somewhat stable like it has some market value.
1:48:25
So, if you're trying to like gamble less and you're addicted to angel investing, maybe you know downgrade to just laboo and loot boxes.
1:48:32
>> A big attraction of especially the Leoos, which we can get into later, is like they have like these sets that come out.
1:48:37
So, it'll be like >> you would collect the full set. >> Yeah.
1:48:39
It's like 10 and then they're basically all the same except like the color of the fur is slightly different or something.
1:48:43
>> Um but then create a complete set which will then sell for more.
1:48:48
>> But obviously if there's 10, you can't just buy 10 of the boxes because you're probably not going to get all of them. So, you have to buy.
1:48:53
I think that Porsche should get into blind boxes.
1:48:58
>> Imagine if you just imagine if like a 9 you could just buy 911s only with blind boxes. >> It's like 200k. You might just get a B.
1:49:06
You might get a Carrera T like super base model. You might get a GT3 RS. >> You might get an ST. Wow. Yeah. Yeah.
1:49:14
There might be something there.
1:49:16
>> I don't know to do it.
1:49:17
>> I mean people would be people would be sending it on those. >> I think so. Yeah.
1:49:21
Yeah, I mean and you just work out the expected value, right?
1:49:25
So, you just charge whatever the the expected value is there.
1:49:28
I there isn't quite enough of a delta.
1:49:30
They need to throw in like a Carrera Carrera GT as well. A few of those as well.
1:49:36
>> You used to see a similar thing um in the sneaker market when that was like a really big thing on eBay.
1:49:39
You would see these like a third party like mystery boxes.
1:49:44
>> Oh, eBay would just do it. Interesting.
1:49:46
People on eBay, but that's crazy because like that's even like less regulated because they can just totally like cook the bucks.
1:49:51
I I feel like versus like a real company that has probably some sort of oversight. >> Yeah.
1:49:56
I mean, you don't really know how many people were actually buying it or if it was just like for YouTube that they make the videos like, "Oh, I bought this $500 mystery box."
1:50:02
>> I I remember I bought a uh a mystery box of cords on on a woot.
1:50:05
com, which was an electronics reseller that was bought by Amazon.
1:50:11
And >> that's so courageous box of cords.
1:50:16
>> It was just electronics electronics. So it was like so woot.
1:50:17
com would go around and find like like a bunch of electronics that had been discounted.
1:50:21
Uh I bought a I bought an HD projector that was probably like three grand for like 600 bucks because like they were like going out of stock and they just needed to like liquidate and so we would go and buy the liquidation and then put it on the website and you could just buy it but it was limited time.
1:50:35
They would just do one daily deal every day and one day they just did a mystery box and you could just buy they would just give you like literally like whatever was in their facility they would just back like like pack up for you and who knows I got like oh this like HDMI to DVI cable or something.
1:50:54
>> You can probably trace back something like um do you remember storage wars the show where it's like they open it you can't go in but you can just see the front and then you have to try to estimate the value and then yeah so there's probably some there. >> That's great.
1:51:04
So, when did China figure out that this was gambling?
1:51:06
Because they banned the sale of Laboo to kids under 8 years old.
1:51:11
But that still means you got 10 years before you're legally adult here in the US at least where >> Yeah.
1:51:19
Also, I don't know how many like actual 8-year-olds are going to the store and buying it. It's not their parents.
1:51:23
So, it's kind of unclear.
1:51:25
>> Well, if you're worried about your employees gambling with your company funds, get on ramp. com. Time is money. Save both.
1:51:29
Easy to use corporate cards, bill payments, accounting, and a whole lot more all in one place.
1:51:34
Very easy to set a a rule in rampart. No labu. No pop. >> No popart. >> Anyway, continue. >> Okay. So, let's go back.
1:51:41
So, so 2015 is when Lubu first appears as it's in a picture book.
1:51:46
So, this has nothing to do with PopMart.
1:51:47
It's just this other artist um Kaisen Lung. >> Mhm.
1:51:52
>> Um and then 2016, this is um PopMart's first like kind of real IP that they created that like went super viral. >> Yes.
1:52:00
Um, Ning in 2016, Ning tries something new.
1:52:03
He flies to Hong Kong and meets with artist Kenny Wong, who had created the trendy toy figurine Molly in 2006 and was a big designer in the toy niche.
1:52:12
There he negotiates exclus an exclusive license with Wong to develop and sell Molly products and blind boxes. Interesting.
1:52:21
>> So, I I I think this was it's done around 800 million in revenue. >> Whoa.
1:52:26
>> Since uh 2016, >> let's go. Yeah.
1:52:28
So, selling Molly not only gives Ning more control and capitalizes on trendy toy plus blind box signal, but it capitalizes on Kenny Wong's fan base and leads Ning to his next big unlock betting big on controlling existing toy IP with a built-in fan base instead of selling third party.
1:52:44
So, in 2017, uh sales of Molly are going nuts.
1:52:48
Total uh 22 million by end of year for Molly.
1:52:51
Uh, PopMart rolls out vending machines, reducing rent they had to pay in malls and establishing way deeper reach with fandom.
1:52:59
Company begins repeating replicating the Molly >> unregulated slot machines. >> Yeah, basically.
1:53:04
Uh, and then they uh uh Pucky is another Hong Kong artist derivative uh that they launch and then they launch a seder.
1:53:12
You know, it's like half uh half like goat legs, which is very odd.
1:53:17
They're getting >> not beating the antichrist allegations. >> Yes.
1:53:22
If you've been at the PT lectures in SF for who the antichrist is, I think we got a lead here. I think we got a lead.
1:53:29
Wait, did you already write that?
1:53:30
>> Yeah, this is already there.
1:53:30
Yeah, >> you already wrote that. That's amazing.
1:53:33
>> Many there's a lot of allegations here.
1:53:34
I mean, it's unclear whether you know what the original >> I think we solved it, folks. Yeah, we've solved it.
1:53:39
Wait, is there really a star on them?
1:53:40
Is that a thing or a pentagram? Okay.
1:53:44
>> Well, that's why Yeah, question mark.
1:53:45
>> Max over in the Substack chat says we need to tokenize the Laboos.
1:53:47
I think that's I think that's how you >> That's obviously happening next.
1:53:51
We know that's going to happen.
1:53:53
We know that's going to happen.
1:53:56
>> Uh CS GO loot boxes walked so Leubu could run this.
1:53:59
>> Brandon Brandon in the X chat says we got to get a bezel box going. Totally agree.
1:54:04
>> Quaid, let's get some Let's get some blind boxes going.
1:54:06
You might >> you might get a Nautilus. You might get a tutor. >> Yeah, there you go. There you go. Okay, so where are we? 2019.
1:54:13
So now 2019 uh um Lubu is then licensed to PopMart. >> Yep.
1:54:20
So just uh in in 2018 right before this uh sales spiked to 73 million on the back of Molly.
1:54:25
Around this time PopMart built its own in-house design team, the Pop Design Center, like the Porsche Design Center.
1:54:31
Uh it becomes a powerful pipeline alongside ever more exclusive artist licenses and big non-exclusive entertainment licenses.
1:54:39
If you want to entertain people on a stream, get on Reream.
1:54:43
One live stream 30 plus destinations multiream and reach your audience wherever they are. Continue. >> Okay.
1:54:49
So, so they license in 2019, but they don't actually release like the modern Lubu doll until 2023.
1:54:54
>> So, it's in the book or whatever. >> Yeah.
1:54:56
They're starting to build the lore, build the >> IP.
1:54:57
They do characters, they do little figurines, but it's not like the the kind of modern instantiation.
1:55:02
>> Um, so then let's go to 2020. They IPO at 7 billion. Okay. >> In Hong Kong.
1:55:06
And then, >> wait, hold on.
1:55:08
So, so, uh, continuing with Brandon, 2019, uh, PopMart began selling Labou blind boxes an exclusive deal with artist Kasing Lung, uh, Labou's original character in Lung's picture book trilogy called The Monsters, but was selling his figurines in Hong Kong by 2015.
1:55:22
Uh, at time of the deal, it's only popular among niche toy collectors.
1:55:27
And, uh, we do have some images in the deck, by the way, guys.
1:55:31
Uh, if you want to pull up the pictures of these, uh, these monsters.
1:55:33
Yeah, if you scroll down a bunch, um, there are some photos of the Laboos.
1:55:38
It It has like kind of a street art vibe. Very chaotic drawings. Keep going. There's one more. Keep going. One more. Keep going. That's Molly. That's the first Laboo.
1:55:50
Um, the Monsters Trilogy by Cing Lung, the story of Puka, Pau, and the Girl, Miro's Reququum.
1:55:57
And so these started selling in 20 uh 2019.
1:56:00
In 2020, uh, PopMart raises hund00 million on a $2. 5 billion valuation. Hit the gong. >> I see a large IPO.
1:56:10
>> Uh, and a few months later, IPOs in Hong Kong stock rips 80% on open day opening day.
1:56:15
You thought meme stocks were just an American phenomenon.
1:56:17
Meme stocks are a worldwide phenomenon.
1:56:20
Across the pond, Ning's net worth doubles overnight. Uh, he's worth 3.
1:56:24
2 billion at open, 6 billion at close. Popart has a 12.
1:56:27
5 billion market cap at close. That's a big company. That's a big company. So, um, let's continue. >> Okay.
1:56:36
So, so 2023 is when the blind box Lubu like phenomenon really takes off.
1:56:40
So, this is I think probably it's it's mostly due to Tik Tok.
1:56:44
>> You see a lot of this. Um, and then yeah, 2025.
1:56:47
Right now, it's like around 55 billion.
1:56:51
>> Now, it's now it's at 55.
1:56:51
Um, absolutely incredible. What a run.
1:56:54
Um, should we pull up the Wall Street Journal video, watch some of that? What do you think? >> Yeah, let's do it.
1:56:59
Um, while they're pulling that up, uh, let's tell you about figma. com.
1:57:03
Think bigger, build faster.
1:57:05
Figma helps designer development teams build great products together, folks. Get to figma. com.
1:57:11
Uh, design your next Leubu drop. >> Yeah.
1:57:14
I mean, developing real IP this quickly is incredibly impressive. >> Yeah. Yeah.
1:57:20
>> IP that can do billions of of >> Yeah.
1:57:24
I mean, it just takes so long.
1:57:24
I remember learning about the uh the Lucas Film acquisition that Disney did.
1:57:28
Even the Marvel acquisition, this is the these are like they were big acquisitions at the time, but like singledigit billions, low double digit billions like and then they just created so much value as they actually monetized the IP and created like shows and merch and like ran the Disney machine around it.
1:57:46
Um, seems like PopMart's capable of running like a Disneyesque monetization playbook on top of somewhat new IP, which is pretty crazy.
1:57:56
Um, anyway, let's pull up the Wall Street Journal video and uh, watch a bit of that.
1:58:00
Uh, Aiden says, "It's nightmare fuel." I agree.
1:58:04
>> Whenever Chinese retailer PopMart drops a new Laboo designer, it sells out within minutes. >> Sold out.
1:58:10
>> Insufficient stock already.
1:58:12
It does seem like um hard to get toys like it's a it's truly like a worldwide phenomenon in the sense like it's not just women that are doing it. It's not just men.
1:58:20
It's like it's really all >> it's not just adults, it's children. >> Children and adults. Yeah. Yeah.
1:58:25
You would think it's like oh it's just kids.
1:58:28
So yeah, their revenue doubled have flooded social media.
1:58:31
Fans flock overseas to buy exclusive products.
1:58:35
>> I mean it just has the natural dangling off of celebrities.
1:58:38
>> Look at Madonna promoting >> PopMart everywhere.
1:58:39
>> PopMart everywhere. But can the company continue to grow beyond this viral moment that has seen its share prices rocket more than 1,200% since the beginning of >> uh here pause it >> the economics up >> the >> are you rooting for their downfall >> praying on it even um the I don't know uh I think I think the bigger question
1:59:00
is like there's something that so so it's easy to say like these go viral on social media like it's a beneficiary of social media but like if you actually think about why is and an why is a Lebu more viral than you know the latest in iteration of Barbie or Beanie Babies like there is a reason and it's directly related to the nature of the algorithm. So when you do an unboxing
1:59:24
So when you do an unboxing there it like it naturally takes about one minute if you edit it down to do it and the reveal comes at the end.
1:59:34
So when you watch it, you say, "Oh, someone's doing an unboxing."
1:59:38
They're introducing what the stakes are.
1:59:40
It hasn't >> It's good for the creator because they get that retention. >> Exactly.
1:59:44
It It drives retention because it has a natural storyline of like, "Okay, how did I get this box?
1:59:49
How much did I pay for it?
1:59:51
What are my expectations?
1:59:52
Do I have something on the line?
1:59:54
Maybe I'm hoping to build the set, right? I want to build a set.
1:59:56
I really am hoping for the red one or whatever."
2:00:00
And and then and then you you're you're taken on this journey.
2:00:02
And I believe when they when they unbox them, there's like two stages to the unboxing.
2:00:06
You you take it out of the box and then there's packages >> tied together.
2:00:10
So there's a box and then third stage is when you have your dog rip its head off >> and see what's inside. What was What was this?
2:00:16
>> So there's the box then there's like a nice like opening like you like rip it.
2:00:20
It's like nicely packaged and then inside there there's a little bag and then inside the bag is the actual >> Yeah. Yeah. Yeah.
2:00:24
So, so even that like lends itself to like keeping you engaged for 60 seconds, which is going to drive more virality in the in the feed.
2:00:34
>> Aaron Frank uh partner at uh Lightseed says, "I have the largest single collection of Laboos America." No, I'm kidding.
2:00:42
He texted me and said, "This is hard to watch.
2:00:45
>> This is hard to watch."
2:00:46
>> So, sorry we're we're forcing you to sit through this, Aaron.
2:00:52
>> Uh let's play a little bit more of the journal video. >> Yeah. Let's pull it back up. Yeah, keep going.
2:00:59
>> The culture was founded entrepreneuring at >> Jiovan Lawrence in the chat says, "My startup has done 75 million in unboxings." Say more. >> Yeah, elaborate.
2:01:11
>> 2019 over 70% of >> Tamagotchi for real should come back. AI powered Tamagotchi. That's a good business.
2:01:18
>> What we've done is just added our own flavor to that.
2:01:21
Now, the company has more than 500 storesational,000 vending machines worldwide. Southeast Asia.
2:01:28
>> When you decide to splurge on a PopMart blind box, which could cost around 20 to $30, you don't go in totally blind. Take this collection.
2:01:36
There are six possible characters you could unbox and a secret one that you have a 1 in72 chance of getting.
2:01:43
One of the things that the brand can do to keep engagement, to encourage consumers to get a little more excitement out of it, is to label the box.
2:01:52
This one says have a seat.
2:01:55
>> You know, people people throw the satanic panic around a lot.
2:01:56
Like white monster energy drink.
2:01:59
There's like a whole 666. It's satanic.
2:02:02
And it's always unclear if it's like the the founders are are like poking fun at Satanism.
2:02:10
Like no one accuses like John Carmarmac being satanic by or I mean I guess people did when he released Doom, but in in Doom it's like you're clearly playing as a as a a mortal like killing the demons and that's the name of that that's the that's the virtue of the game.
2:02:26
>> Aaron just sent me uh the the stock chart for Build-A-Bear.
2:02:29
Have you seen >> Oh yeah, Build-A-Bear is ripping too.
2:02:32
Does Build-A-Bear have loot boxes yet?
2:02:34
That could be the next unlock. >> Build-a- Bear is up.
2:02:37
>> It's outperforming Nvidia, I believe.
2:02:39
473% over the past 5 years.
2:02:41
>> It's absolutely ripping. Who's clapping?
2:02:44
>> Build-a-Bear blind boxes. No more building.
2:02:47
Just Just gambling children.
2:02:49
Just come come into the store. >> Yeah. Yeah.
2:02:51
If Laboo is like the slot machine that you could be pull out of the uh the vending machine.
2:02:55
Build-a- Bear should turn it into like a game of like high stakes.
2:03:00
>> Has anybody allow done like remote labu openings?
2:03:03
So, it's just actually like >> I think I've seen that. Yeah. Uh who was it?
2:03:06
Blake Robbins posts about this a lot.
2:03:08
How there's like apps in the app store that are >> Oh, it's probably happening on like whatnot to be honest.
2:03:14
>> Well, have you seen Have you seen the claw game?
2:03:15
Uh, so there is a there is a an app that you can download and you can pay real money to use a a claw in the real world to pick something out of a out of a you know a machine or like a bucket and whatever you pick out you get to keep and they will mail it to you. Wow.
2:03:34
And so it's not technically gambling.
2:03:36
Somehow they got some like loophole there.
2:03:38
Very >> right now on whatnot.
2:03:40
There's like seemingly hundreds of streams selling Laboos. >> Wow. Don't gamble folks.
2:03:46
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2:04:02
Uh anyway, the last two years of uh what's interesting is the last two years of of sales in uh in uh of Labubu have been heavily driven by international expansion.
2:04:14
They've definitely figured out how to take the brand abroad.
2:04:15
Uh it was predominantly uh growing in mainland China and I believe it's still growing.
2:04:24
It's doubling in China, but it's also like seen maybe like a 10x increase in uh in international sales over the last two years. Um, so it's on a tear. It's on a tear. We'll see.
2:04:34
We'll see how people respond.
2:04:36
We'll see how the American toy companies respond.
2:04:38
I feel like um this is like the the horse has left the the stable.
2:04:43
The cow has left the barn.
2:04:45
The dog has left the dog.
2:04:48
>> The children yearn for the slots. >> They do.
2:04:50
They're going to they're going to figure out how to gamble one way or another.
2:04:53
I mean, what what's the alternative?
2:04:54
Like ban labu >> airwan uh airwan blind boxes combo plates. >> Yeah, combo plates.
2:05:01
>> You might just get the worst slopp of your life.
2:05:03
How about sweet green blind boxes?
2:05:05
>> Or you get 12 ounces of blueberry.
2:05:08
>> You might get a bunch of steak.
2:05:08
You might get a bunch of kale.
2:05:11
>> You might get some caviar. >> Never know. [Music]