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And it's Tuesday, June 16th, 2026.
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3:47
Uh sorry about the delay.
3:47
We had a little bit of a technical issue. Glad everyone's here. Thank you for tuning in. It's YC Demo Day. >> for never doubting. >> Never doubt us, ever. No, it's okay.
4:00
Every once in a while, you can >> You can doubt us a little bit.
4:02
>> Pop off in the comments. Pop off in the chat.
4:04
But, uh we have YC Demo Day.
4:04
We have 1 2 3 4 5 6 7 YC founders joining, then three YC partners, and then we're going around the horn talking to some other folks.
4:14
Threads just hit 500 million monthly active users.
4:16
We're having Conor Hayes back on the show. We have that. Luke Burgess is here.
4:20
Burgess is here with his new book, uh The One and The 99.
4:26
And so, we'll go through that.
4:27
Not a lot of time for the news, but we'll take you through it anyway.
4:32
Um >> And in the middle of guests, we'll jump in for a little news. >> Exactly. >> We love >> Exactly. >> love the news.
4:38
The big news, >> Big news, Jeremy.
4:41
>> is that SpaceX ran like absolute crazy after hours last night.
4:49
Uh I I kept getting push notifications and thinking that that can't be right.
4:54
And then I would double-click in, check a little bit, and I would say >> Yeah, the headlines are crazy. >> So, yeah.
4:59
So, the big one is is >> There's so many of them that just like it's passing this company, passing this company, passing that company, and you're like, "Whoa, this is a crazy crazy time."
5:08
>> SpaceX is sitting comfortably in the top >> Five.
5:13
>> five company >> Nvidia at $5 trillion, Alphabet and Apple right around four, four and a half, then Microsoft and SpaceX neck and neck just shy of $3 trillion.
5:24
Uh Uh and it basically makes their their Cursor acquisition free.
5:26
They paid 60 billion in new stock for the company, and their market cap, SpaceX's market cap, uh more than quadrupled and added uh more than 4x the price of the Cursor acquisition.
5:39
>> I believe they had until Q4 to actually pull trigger on the Cursor deal.
5:42
Like they built in a window. >> now?
5:46
>> Um I bet you I bet you there was some terms that weren't public that that Cursor would have wanted to make sure that they got in as quickly as possible, >> Sure. Sure.
5:58
>> because I think they've done really well. >> Yep.
6:00
>> Uh who knows where SpaceX will net out.
6:03
I mean, I thought I thought we'd be at 2.
6:05
4 trillion by by the middle by basically the last hour of trading on Friday. >> Yeah.
6:11
>> Uh I was incorrect at the time, but um uh it's obviously, you know, continued to run.
6:17
Um and uh there was another scenario where SpaceX could have effectively acquired Cursor at an even higher um uh at an even higher valuation, but uh I think it's a great fantastic outcome for the Cursor team, obviously.
6:30
Uh you know, OpenAI, it's big Cursor investor, Thrive, a16z, uh Coatue, uh and and others that um that I'm uh unfortunately forgetting, but uh and of course I'm >> about this?
6:44
He said it's the biggest the biggest VC-backed In the past 5 days, we've seen the biggest VC-backed IPO ever and the biggest VC-backed strategic sale ever.
6:55
We've never had a an M&A of a VC-backed company, young startup, north of 50 billion.
7:04
Like 60 billion is so so big.
7:06
We sort of lose sight of it because we're talking about a trillion dollars for this company, 3 trillion for that company, but 60 billion is beyond a home run. >> Yeah.
7:18
>> And it happened in an M&A, which is crazy. >> And >> Yeah.
7:22
>> there's I would have assume a a large number of the retail investors invest investing in SpaceX were not necessarily even that familiar with Cursor up until today.
7:31
>> I did see the headline today.
7:33
>> if you're waking up today, you're like, wait, SpaceX just acquired uh one of the hottest AI companies in the world with billions of dollars in revenue. Like this is so bullish.
7:42
Obviously, a lot of the more institutional investors or people that that had been follow following the company um privately were well aware that that the the that they had the option to do this and that they would almost certainly take it.
7:56
But >> The texts are all over the timeline.
7:59
Quinn Thompson says, "This is brilliant corporate finance.
8:01
Use your newly printed low float retail inflated currency to acquire real businesses ahead of the lockup expiring.
8:08
Probably most creative a creative way to sell as much equity as possible into IPO pump.
8:11
I wonder what acquisition is next." That's very interesting.
8:17
Nick Carter fights back fires back and says, "You think the people buying the equity would also be aware of this." And that's a good point.
8:24
But um the question is like are there more acquisitions in the pipeline?
8:29
Because Tesla has not done a lot of acquisitions.
8:32
Elon's always been a build, not buy operator or founder.
8:38
>> Tesla itself >> Yeah, that's a very different scenario.
8:42
What I'm talking about is like there there are companies Meta is very acquisitive, Google, Apple.
8:46
Apple's like on the smaller side, but they still do deals more frequently.
8:50
Uh it would be very interesting if we're seeing we know one deal a month and he's sort of putting together the pieces of an buying up Neo labs and compute capacity and Neo clouds and rolling everything up.
9:04
That would just be a completely different operating philosophy.
9:07
But given where the stock is, given how smooth this deal went, and where the where the market cap of SpaceX is, it's not the craziest thing.
9:15
It would be a big pivot in his uh in his strategy though.
9:19
Uh Business Insider has a deep dive on Cursor's wild ride.
9:24
Michael Truel didn't pay himself for years.
9:28
Uh interestingly, Cursor once made up 40 to 50% of Entropic's revenue.
9:30
That is a crazy, you know, gyration in the market.
9:34
Just shows you how quickly things are changing.
9:38
Went from, you know, it's all Cursor, that that business is just funneling to Cursor.
9:42
Cursor is the front door to this business.
9:44
Then it's like, oh, it's all these hyperscalers that are spending a billion dollars, half a billion dollars a month.
9:49
And so, the the whole the whole landscape is changing.
9:54
Nothing nothing tells that more than Anthropic telling Cursor that Claude Code was just a research effort.
9:57
This goes back to the Dylan Field like where they consistently can it or maybe they really just did think, hey, yeah, this is just a research effort.
10:03
Like you do you and then realized later like, whoa, whoa, whoa, we we need to be a player in this.
10:08
We cannot be in the middle of this situation.
10:11
So, we got to do our own thing.
10:13
>> Owning the end customer relationship. >> Yeah. And so, wild wild ride.
10:18
>> Yeah, similar similar to I think the messaging to Figma, Canva around Anthropic's design tool. >> Yeah, it's tricky.
10:25
Every AI company is is a general use technology.
10:28
They're using it for everything.
10:30
There's there's, you know, questions about like, will you maintain value if you're in the token path?
10:36
Do you need to be like, do not build a company that depends on the models getting better?
10:40
But if the models get really, really good, like what can't they do?
10:43
And so, constantly we see every company competing with every other company as, you know, every hyperscaler has an LLM at this point and every SaaS product has other products cuz they can launch features faster.
10:55
And so, the the competition is heating up across all these different companies.
11:00
>> Next time we have Michael on the show, we got to ask how he paid the bills for all those years. >> What was he doing?
11:06
Crashing on couches or something? >> Got to ask. >> I don't know.
11:09
>> Um, taking out massive loans against the company, maybe. Who knows?
11:14
>> Let me tell you about MongoDB.
11:14
What's the only thing faster than the AI market?
11:18
Your business on MongoDB.
11:18
Don't just build AI, own the data platform that powers it.
11:24
>> Snap also has some big news today.
11:24
We're going to get to it.
11:27
>> We'll get to that after our first interview with Andrew Lee from Tasklet.
11:32
He's the founder and CEO.
11:34
Andrew, welcome to the show.
11:34
Thank you for the patience and joining us on such a busy day. How is Demo Day going? How are you? >> I'm doing great. Thanks for having me. I want to be up front.
11:44
I can neither confirm nor deny the SpaceX acquisition rumors. >> Okay, I see. They're flying around. >> around Demo Day.
11:52
>> Elon's probably there at Demo Day shaking hands trying to scoop up roll up the entire batch maybe, who knows?
11:56
He's got the staff to do it. >> No comment. Demo Day is great.
12:00
We're we're we're having a good time.
12:01
There's a thousand people here. There's 200 companies. It's it's a good time. >> Amazing.
12:08
>> Did you Did you pitch already?
12:08
Or is that ahead of you still? >> Not not yet.
12:11
We're in We're in group four, which is going to be this afternoon.
12:14
And it's actually my co-founder who's going to be up on up on stage giving the talk. >> Cool.
12:19
>> I'll just be the pretty face over on the side. >> Okay.
12:21
Well, give us some backstory on yourself and tell us about the business.
12:25
>> Yeah, so as background I was the thing I'm probably best known for is I was one of the founders of Firebase.
12:31
So, this is my second time through YC.
12:31
I did the summer 2011 batch.
12:37
We sold that company to Google in 2014.
12:40
I was there for about 3 years.
12:43
This This company has been a very interesting story.
12:44
We actually started in 2020 as a better Gmail.
12:46
Like we tried to build a new email experience.
12:51
Raised a bunch of money, hired a team.
12:53
>> you quit Google to try to to try to eat Gmail alive? >> Yeah.
12:58
I I had already left Google a couple years before, but I saw them shut down Inbox and I said, "Man, what are these This is a huge huge product.
13:03
Like what are these guys doing?
13:06
We should do a better job. This is a terrible idea. Don't do it. Don't invest in it.
13:12
But just as we were getting ready to shut that thing down LLMs got good and we're like, "Holy crap, we can take all of this data that you have and we can feed into a language model and we can like draft emails for you.
13:24
We can do interesting types of search and we can do Categorizations.
13:25
We started kind of pulling that string and around about this time last year, we had this really good agent inside our email client and we had a bunch of users being like, "Hey, I love your product, but could you just get rid of all this inbox crap, right?
13:41
Like the UI is getting in the way."
13:43
And so, we spun it out and we had a it's a totally new product, totally new codebase and this is Tasklet and we launched that in October and that's gone super super well and that's, you know, that's why we're in YC.
13:52
That and that's gone, you know, at the beginning of the year we were at about a third of a million of run rate.
13:57
We're at a $7 million run rate now, so it's like a nice >> Woah. >> nice fast ramp.
14:01
Um and >> Is that the bar now?
14:05
Like is is there, you know, are you meeting other companies in the batch that are that have been able to ramp that that quickly?
14:13
>> I I think we have the highest revenue of the batch. >> There we go. >> Let's go. >> There we go.
14:17
Well, why don't we go hit the gong and then then we can boom. That's for you. Um >> Love that.
14:27
>> So so this feels like So we were we were looking at at at our little summary here.
14:32
AI agents that connect across work tools, run 24/7 and take ownership of recurring workflows.
14:39
Uh >> Does big tech hate you?
14:41
Like if you is I feel like they the whole point is walled gardens.
14:43
That what that's what creates value accrual.
14:48
That's what keeps the value accruing to the work tools that, you know, big companies CEOs love and extract a lot of value from and you're coming in here and digging a hole under the wall of the garden and throwing a ladder over the top and digging a hole right through the the walled garden. >> Absolutely.
15:10
>> you like maintain those integrations if if if the actual platform is maybe like hostile?
15:16
We've seen reporting about this where different companies have tried to sort of integrate across and then they've wound up with sharp elbows.
15:23
I think a lot of them have figured it out, but like how do you think about working uh copacetically with the the work tools that you integrate with? >> Totally.
15:32
So so AI has totally changed the game.
15:34
You know, 2 years ago if you wanted to integrate with a bunch of stuff, you had to like hand-code a bunch of integrations and there were, you know, companies like Aneddan and Zapier that just did that and that was their moat.
15:43
And our secret sauce is that we can dynamically generate the integrations with AI like when you need them.
15:49
So we have a bunch of, you know, canned integrations.
15:52
Some of that we some of them we've hand-coded and made them like really, really nice, but even if you ask for an integration we don't have, the AI can generate one for you.
16:00
And this is super powerful not just cuz it lets you go outside the walled garden, but because it lets you connect to things that like might not be public at all.
16:06
So if you're a company, a lot of times you have internal APIs and you're like, "Hey, I want to have some integration that hooks up to like Notion and HubSpot and Gmail, but then also like my random bespoke like internal API."
16:18
And you can't do that with, you know, any of the products from from, you know, big tech.
16:22
You can't do that with, you know, Claude or uh or OpenAI, but our product yeah, sure, you can integrate, you know, via API with this thing with MCP, with this thing, with a a pre-canned connector with this other thing and they can all work together. >> Mhm.
16:34
>> What's the state of search these days?
16:34
I feel like we've seen incredible progress in AI and agents and then when I have the same frustration that you had when you were thinking about working on email, uh I'll type in some keyword, you know, like YC and I will get some cookie, some string that's stuffed in a receipt from some coffee shop and it has nothing to do with Y Combinator. The context isn't there.
17:01
Uh Apple intelligence is rolling out.
17:03
It takes like 5 days just to index everything into a some sort of rag database.
17:07
Like it why are we falling behind there?
17:09
Is that a key is is that key to your strategy or is it something that it's a it's a problem for someone else to work on.
17:18
>> So, I think agents again have totally changed the game here.
17:20
So, with in shortwave, our email client, >> Yeah.
17:22
>> the way we did search was the, you know, the vector database approach, right?
17:25
We we embedded your all your emails, we stuck them in a vector database, we had this interesting search stack, and the goal there was to have like the search results be good. >> Yeah.
17:33
>> And it turns out with if you have a really smart model and you have an agent, you don't actually care that much if the search results are good as long as you can run lots of searches.
17:40
So, what we found in Tasklet is we don't need to like ingest all your email and index it.
17:46
We can hook up to the regular APIs and just run a whole bunch of queries in parallel, look at the results, adapt, iterate, >> keep refining.
17:55
>> And so, the results are are are almost as good without any infrastructure.
17:57
So, it's a lot cheaper, you can connect to more stuff.
18:00
So, I think if you find use Tasklet, you can kind of hook it up to anything, and you'll get surprisingly good search results without any special back end stuff.
18:08
>> But, I imagine that that's sort of slow right now, and for a company like Google to roll that out to a billion users, you know, for free immediately, that's going to be really expensive.
18:19
So, that's still a ways out.
18:21
They need to actually chop through that.
18:23
But, we could expect that search will get faster and better over the next couple of years.
18:28
>> Yeah, I think I think that is the big drawback.
18:29
And like as an example, uh for for prep for demo day, I wanted to make sure that I I chatted with the folks that were here that had reached out to me.
18:36
And I've had people reaching out over a period of months.
18:37
And so, I took Fable 5 back when that was still a thing, sure, and I pointed that at my Gmail, and I said, "Go find everyone who's who has cold emailed me in the last n months who might be at demo day, and like give me a spreadsheet with those folks."
18:52
And it spent like and and and and sacring them, right?
18:55
Like I want to know, "Who should I talk to first?" and so on.
18:57
And it spent like half an hour, it spent like $60 running this thing, right?
19:02
But the end of the I had this spreadsheet of like 100-plus folks that was like carefully researched and like ordered, and like it found every like there was no one I could think of that it that it didn't find in that process.
19:13
So, if you're willing to spend 60 bucks, if it's worth it to you, like great. >> I love it.
19:17
>> Are you Last question.
19:17
Are you capital constrained? >> Mhm.
19:22
>> Like, I'm assuming you have a bunch of offers.
19:23
Maybe you already finished your fund raise. But, uh why even raise?
19:25
It feels like you guys seem to be making I I would imagine with that kind of revenue ramp, it'd be hard to not be making money right now.
19:35
>> We We are We are not capital constrained.
19:37
We actually already closed a $20 round in April.
19:38
Um with USB and Lightspeed and some other folks.
19:42
Uh but, uh they're, you know, we're competing directly with Anthropic and OpenAI.
19:47
They've obviously raised a lot more money, and I think we can put it to use.
19:50
So, we are We are raising more money now.
19:52
>> I like I like just I like just saying the actual reality, cuz there's a lot of founders that would come on and be like, "Well, actually, like we do something that like, you know." And it's like, "No.
20:01
Everyone is competing all the time, and uh it's better to just accept it and uh play the game. So." >> 100%.
20:08
And I think Corgi set a new bar with, you know, 3 weeks from from What was it?
20:11
Series B to C or whatever they did there. So, you know, why wait? >> 3 days. Do it in 3 days. >> 3 days. [laughter] I love it. >> Uh awesome. Thank you for coming on.
20:21
>> Yeah, great to meet you, Andrew. >> Congratulations.
20:22
>> Congrats on all the progress. >> Talk soon. Thanks for having me. >> Have a good one. >> Cheers.
20:26
>> Let me tell you all about the New York Stock Exchange.
20:28
Want to change the world?
20:30
Raise capital at the New York Stock Exchange.
20:33
Our next guest will be sitting in that same seat, slotting in in just a second. We have Sam Altman.
20:42
>> And we'll be working on >> Robotics. >> Oh, yes. Yes. Yes.
20:45
Uh >> Uh good Alexander says, "I pay for Starlink. It's a great product.
20:49
Cursor is also a great product.
20:51
Codex is a great product.
20:52
And Claude with Fable is ridiculous product.
20:55
That's the main difference between now and 1999.
20:56
All this stuff is awesome." >> So, total white pill. Then read the follow-up.
21:04
>> I don't think you can really compare this to 1999.
21:05
I think it's actually unprecedented.
21:07
If AI doesn't work, the global debt bomb explodes and there's a great depression.
21:11
The 1999 natural pop and things were generally fine. >> Yeah.
21:16
So, it is higher stakes, but it's more impactful.
21:18
So, it he's he's I mean, it's a good point to not try and draw too much comparison to 1999 just because it's uh it's it's it's technology.
21:26
It's a technology-driven boom.
21:28
It is very very different in terms of uh the the financial structure and also the the impact, the revenues, the rollout, the opportunity.
21:38
Uh all of these things were just in higher stakes territory, I suppose.
21:42
Uh anyway, we have our next guest from Eden Robotics in the YC Demo Day stage. How are you doing? Welcome to the show. >> Hey guys. All good. How about yourselves? >> We're doing great. Thank you so much.
21:57
Introduce yourself and the company.
21:59
>> Yeah, so I'm Stam, uh CEO and co-founder of Eden Robotics.
22:02
Uh we're making general-purpose robots uh for manufacturing and warehousing initially and everything else uh right after that. >> How general? Are we going humanoid? Are we going wheels?
22:13
Are we going >> Uh semi-humanoid. >> Semi-humanoid? What does that mean? Centaur? >> Yeah, centaur.
22:19
So, the body the legs are there's four legs like a horse.
22:23
>> [laughter] >> But yeah, what is yeah, semi-humanoid?
22:26
What what does that actually mean?
22:28
>> So, that means it's a wheeled base uh robot. It has wheels.
22:30
Um but it has two arms which are placed like a human in their shoulders.
22:35
Same way we have and it also doesn't have uh dexterous hands. It has uh grippers.
22:41
Um which fun fact can do more than 80% of work in industry. >> Interesting.
22:44
What what what about the the wheels are important to decide like I a lot of uh manufacturing facilities have very flat floors.
22:52
So, I imagine you don't need really any stair-climbing ability which some wheeled robots can do.
22:58
Um but do you need to be omnidirectional?
23:01
Do you need to change path?
23:01
Is it just about optimizing battery life?
23:05
Like, what are the trade-offs that you decide when you're building the base?
23:11
>> Yeah, so so when you're building a base, really, when you're going with wheeled, it's not going to be as general purpose as legs.
23:16
Like, legs can go anywhere.
23:18
But, it doesn't have to be, and you have a massive gain in both costs and energy.
23:24
Legs are extremely expensive in terms of energy, and also in terms of like simply cost.
23:31
>> also, I imagine you can put way more battery pack on top of like the wheel base, right? >> Yeah, that's right.
23:36
>> Half of our Half of our base is just the battery.
23:37
So, half the base is just the battery, and then the other half is the compute. And that's it.
23:41
>> So, how how long Is there some sort of like sweet spot for once you have a robot that can roll around and do work in a manufacturing plant for 6 hours without needing to recharge? That's the sweet spot.
23:55
You know how like 300 miles of range was like the sweet spot for electric vehicles, and under that you start getting range anxiety?
24:02
>> Yeah, so I think 6 hours is too low.
24:06
Right now, our robot is using a car battery. It can run for 12 hours.
24:11
But, with our own >> car battery, just like one of those like bricks that's a car battery? Oh. >> Exactly.
24:15
One of It's a really big car battery.
24:19
And with our own car battery design, it can go for 20 hours.
24:21
I don't optimize charging for like these 4 hours and not have to like stop for 4 and work for 20, but like optimize throughout the time to charge enough.
24:30
>> A car battery in there?
24:30
You're thinking about putting a V8 in there, maybe? What do you know?
24:33
>> [laughter] >> Why not? For real. >> not.
24:37
So so So, one of the uh you know, we've had a bunch of robotics founders on.
24:42
I've been trying to understand what what some of the kind of like economic challenges there's going to be to rolling out, you know, humanoid-esque robots.
24:53
robots. When I see some of these humanoid form factors, I'm thinking like look how many different motors it has, how much wear is each of each of the motors going to be taking at any at any given point, and then like trying to run the number on the run the numbers on like the what is the cost of the unit,
25:10
what is the depreciation going to look like over the year, how often are you going to have to be repairing different components to actually make it competitive with a human, which you can hire for let's say 30 to 40 thousand dollars a year depending on uh minimum wage in a you know a certain area or um type of role. Because like the the you
25:29
Because like the the you know aside from humans being like cool and funny, they also go home after work and they feed themselves and they repair you know they they sort of are repairing them you know repairing themselves while they're sleeping, right?
25:42
So that's like sort of off balance sheet uh sort of like activity that's happening that ultimately benefits the business because somebody goes home, eats, sleeps, and then they come back to work refreshed, ready to go.
25:58
>> That's a crazy way to describe human workers, uh but I get [clears throat] it.
26:03
>> But but but yeah but but yeah I'm just like comparing comparing these two things.
26:06
A robot it doesn't go home at the end of the day.
26:07
It might need to be repaired, it might need to be updated, and it doesn't happen unless unless the company actually pays for it.
26:17
>> So the biggest kind of like hardware risk factors just the actuators.
26:20
Uh really nothing else would require maintenance.
26:24
Everything else would be able to last pretty long time.
26:25
Right now we're at this point where you have actuators that are actually good enough to last um like three years and last this over usage.
26:34
Uh it used to be that these actuators would overheat very quickly.
26:37
Um and you would be able to run for a very short amount of time.
26:40
And there are some humanoids today like for example Unitree robots, they're very famous for uh overheating very very quickly.
26:48
Um but there are actuators in the market and we are using such uh actuators that actually can sustain long hours of operation.
26:56
We're running, for example, for 10 hours during alumni demo day.
27:02
It didn't There was no hardware issue when it came to the actuators.
27:06
And it it went pretty reliably.
27:06
We expect that these kind of actuators would have a useful life of about 3 years.
27:13
And in the case of the maintenance, so our whole thing, by the way, is we're not selling these robots.
27:16
So, we're selling the labor.
27:17
And in fact, we're not even leasing them monthly basis. We're charging per hour.
27:21
So, we're charging at $10 per hour, which is actually found that customers love that idea much more than they love the lease idea cuz they have no mental framework, right?
27:32
They have the mental framework of a human worker.
27:35
And so, the maintenance would go is if a customer has a robot somehow breaks, there's a problem with it.
27:41
>> And sorry, is it is it per hour that the robot is actually running? >> Yes.
27:45
So, it's per hour that the robot is >> saying I'm going to charge you 24 hours a day for this period.
27:49
It's like they're you're they're only paying if they're getting actual value out >> You're used to paying 20 bucks to get across town.
27:55
You pay 20 bucks to get across town. >> Exactly.
27:58
We do set minimums, obviously, cuz we need to keep the hardware at the facility, but it's just whatever is enough for us to keep the hardware there.
28:05
Everything else is adapting based on usage.
28:08
>> Well, congratulations.
28:08
Thank you so much for coming.
28:11
>> Did you Did you already get the round done?
28:13
>> Uh not yet, but we're very close. >> Good luck. >> Love it. >> Great to meet you. Come back on soon. >> Have a great one. >> Thank you. Have a good one.
28:19
>> We'll talk to you soon.
28:22
>> While we bring in our next guest, let me tell you about Figma. Agents meet the canvas.
28:27
Your AI agents can now create, modify your Figma files with [applause] design system context.
28:34
>> Breaking from Semaphore. >> Yes.
28:36
>> Netflix lost out to Fox in in pursuit of Roku. >> How is that possible?
28:44
>> I mean, yeah, it is interesting the lore there.
28:46
Netflix sort of created Roku, but the real question is like why would Netflix want to buy Roku? Like the boxes?
28:53
It just seems like it makes so much more so much less sense.
28:57
So, in terms of lost out, I can imagine they lost out.
28:59
>> They sit as an application on on a platform that represents like 40% of connected streaming. >> Yeah, I don't know.
29:07
I I I'm not surprised they lost out because I would be surprised if Netflix like Netflix when Netflix was bidding for Warner Bros.
29:14
that made a lot more sense to me.
29:16
More library, more studio production for Netflix to distribute, but finding a second distributor when they're already competing in the ads based model, they're moving towards a cheaper distribution thing.
29:27
They're already installed by default on most connected TVs.
29:31
>> think I just think it's a way to it's a way to expand like overall engagement, watch hours.
29:36
They're already getting into ads.
29:37
Why would they not want to monet- have like more basically like more watch hours to monetize? >> Maybe maybe maybe.
29:43
It seems like way Roku is in way better hands with Fox than Netflix.
29:48
So, it makes sense why the deal broke that way.
29:51
Anyway, let's bring in our next guest Hugo Fresco from Tenet Industries.
29:56
He's the co-founder and CEO. Hugo, how you doing? >> What's going on?
29:58
I'm doing great over here. Yeah.
30:01
>> Thank you so much for your time.
30:02
Introduce yourself and the company. How you doing? >> Yeah, so I'm Hugo.
30:05
I'm co-founder of Tenet Industries.
30:06
And we are focusing on mass producibility and low cost for the defense system.
30:11
Basically commoditizing it.
30:15
Uh so, I'm from the electronics manufacturing industry and my co-founder, we're three co-founders, but the one of them is from the automotive industry.
30:22
So, basically taking this like mass producibility, those concepts and bringing them to the defense industry.
30:30
>> How low How low cost do you want to go?
30:31
I mean, we're all familiar with like the couple hundred dollar price point for DJI product.
30:38
Where do you want to sit?
30:41
>> Yeah, that's about it.
30:41
It depends on the customer really, but uh uh yeah, we want to match ship products China is our slogan. >> Okay.
30:48
And then and then how how are you thinking about the actual product?
30:52
We've been hearing a lot about the fiber optic controlled drones that don't need to deal with wireless jamming or anything like that.
31:02
Like where is the demand for the next generation product or is it just what we know from a DJI quadrotor what we saw there?
31:10
Are there any specific demands for the defense context that make it a little bit different than what's already out there?
31:17
>> Yeah, there's the the main factor is the range basically.
31:19
It's it's range and the lift power. How much can you lift?
31:23
What's the payload weight?
31:25
So it's all about increasing the range and the main limiting factor for the range is often times the radio, right?
31:31
So what you want That's why they're using like these fiber radios or these fiber optic cables because then you get longer range without getting jammed.
31:40
But unfortunately, I think that the the fiber market it's it's kind of only relevant for this bubble in time because to increase the range, which is the main like what customers want, they want you can do either a better radio basically.
31:55
You can develop better radios and that's maybe the first step and the next step is doing autonomy, right?
32:01
If you have autonomy, then why do you need any contact at all? >> Sure. Yeah, everything.
32:07
Are you capable or do you think it's going to be possible to do on device autonomy on a drone that size 2 kg?
32:13
That's not enough to run some serious GPU, but what what is possible these days? >> No, exactly.
32:19
You can put an Nvidia Jetson on it, but the Nvidia Jetson it's like five times as expensive as the drone itself.
32:25
So then it's not really a one time use kind of deal.
32:29
So but there are these embedded chips for for AI.
32:32
It's just you can't run an LLM model on it.
32:35
You can do some visual recognition and maybe you can do some like prioritization of different targets.
32:42
Um but the main the main factor here about the autonomy is is not really the the vision model.
32:46
That's that's like a solved problem. This is possible.
32:48
The main problem there is is navigation.
32:50
How do you get to the the a near vicinity to your target?
32:55
How do you arrive in like navigating for 20 km without a GPS?
33:00
Because you can't use a GPS on the front line. It's not possible. It's jammed out.
33:03
It's super easy to jam out GPS and to spoof it.
33:05
They will say that you're in in China or something while you're in Ukraine or you're in Sweden or wherever.
33:11
Um so that's the main problem.
33:11
How do you navigate without a GPS?
33:13
Because the the last mile, which is basically the targeting, uh that's a solved problem.
33:20
That was solved in the '60s with missiles.
33:22
Uh I don't get the companies that are pitching that. >> Yeah. >> What's Oh, sorry.
33:25
What is your What is your business model going to look like or what it What does it look like today?
33:30
You're trying to commoditize the category, push push pricing down as much as possible, but you know, what are your margins going to look like and and how do you expect to structure deals with different buyers?
33:44
>> So right now it's it's kind of this pipeline.
33:45
How do you scale a defense company?
33:47
Because it's not really possible to get these deals as a new startup as deals straight to the state.
33:55
At least not where we're looking in Europe.
33:57
But um so what you want to do is you start with the with the private companies. You sell to them.
34:03
So we're we're selling to this counter US companies. >> Mhm.
34:07
>> This This month we went from fifth five orders to 350 orders.
34:12
And then you start selling to this subprime it's called.
34:14
Like basically you're selling to a company that's selling directly to the government.
34:20
And those are really interesting because they have already the channels to sell to these governments.
34:26
And then once you have established like your manufacturing line and your capability and people trust you, then you can sell directly to the government.
34:34
>> Uh chat asks, how does how does their drone survive high-power microwave machines like Leonidas?
34:41
Is the answer that it doesn't, but you can produce at such scale that you can kind of get >> Or they're just high-power >> high-power microwave machines >> like these are rolled out everywhere, but what what what is your take on microwave as a counter UAS uh force right now?
34:58
>> I think microwave is Like we've tested with these people having shotguns and shooting down our drones with shotguns like um uh radar-controlled shotguns, basically.
35:07
And it's a short-range system.
35:07
Uh it only reaches that system only reaches 100 m.
35:12
I don't know about this uh this microwave.
35:14
How how long is the reach that there, but I would guess it's pretty small. >> Yeah.
35:19
>> So then you need a lot of these systems.
35:21
And people don't have that.
35:21
They don't have these systems every 100 m. >> Yeah. Yeah.
35:25
Yeah, not every military installation or unit is going to have every possible counter UAS.
35:30
So it's sort of a game of rock, paper, scissors on the battlefield these >> And then the other thing is like you said like just send more. >> Yeah.
35:39
>> Yeah, that's that's what I that's what I was saying.
35:41
It's like you have, you know, your five exquisite systems, well, we're going to, you know, outproduce. >> Yeah.
35:46
Is everything hand-built right now or you already working on automation?
35:48
I imagine that uh low-cost manufacturability means more on supply chain and design, but what does the actual roll out look like over time? >> Yeah.
36:03
So when we started this, we were we wanted to produce with robots, still do, but basically what we our our background is this manufacturing background, so we're really good at designing for manufacturing, designing it so it's is really easy to assemble.
36:16
So we designed it so how would it be easy for a robot to build this? >> Mhm.
36:22
>> Well, then it needs a few parts and it needs a few screws and no soldering and it needs to be assembled all from one side.
36:28
Um so that was the starting and then it turns out once you do that it's very very easy to assemble.
36:33
So it takes 2 minutes for a human to assemble it.
36:35
So >> then why do you need a robot?
36:40
>> [laughter] >> Good point.
36:42
>> Well your batch mate will have to make a pitch for you.
36:45
>> How's How's investor interest so far?
36:46
You've been busy the last couple weeks or are you starting a process now? >> Yeah yeah super busy.
36:51
It's actually my co-founder Emil who's who's doing that.
36:56
Uh so he's always on call and I'm doing customer demos and stuff. Yeah. >> Very cool.
37:00
Well congratulations and thank you so much for taking the time to come on the show.
37:04
>> Congrats on all the progress.
37:05
>> We'll talk to you soon. >> Yeah no problem. Goodbye.
37:09
>> Um >> Ryan Peterson says with yesterday's 20% SpaceX pop Elon made more money than Warren Buffett made in his entire career.
37:19
>> These headlines are going to get crazy because I I mean I I see some of them getting community noted but it's like a single day will move more than like all of Bill Gates's current net worth. That type of thing.
37:28
Those headlines are going to pop off consistently.
37:30
The crazy one is like it's there's going to be down days.
37:33
Like there's going to be just randomly >> Elon lost more money today than any person in history combined.
37:41
>> lost more money than Brazil makes in a trillion years, you know, and cuz like whenever the big numbers get contextualized it's always very entertaining.
37:52
It was up another 4 15% after hours though.
37:54
But the numbers are staggering when you're in the one trillion dollar club.
37:59
>> JB says is this everyone's first IPO?
38:02
It's silly now as it approaches Amazon valuation.
38:04
Well we passed that but the float is low until the lockup of nearly every retail investor on Earth wants to be involved.
38:10
You're going to get stupid moves then the float opens up and all the retail people are stuck for years. >> What does that mean?
38:16
>> Just say Just say you haven't seen the mass driver demo, buddy.
38:21
>> Uh or or the next data center.
38:21
I mean, uh that's the really interesting thing with Cursor.
38:25
There's all this debate over like they have a deal with Anthropic, they have a deal with Google.
38:29
Cursor obviously wants to compute, but uh talking to Gavin Baker, it sounds like there might be a lot more terrestrial compute coming online in the very short term, and that is valuable.
38:40
They're monetizing this very effectively, and so you could see a short-term revenue ramp just driven from sort of the boring neo cloud stuff that monetizes really well.
38:48
Uh and then that provides, you know, it's like the Model 3.
38:52
It's it's it's going to be the economic engine that provides the capital for data centers in space, mass driver on the moon, all that stuff needs fuel for the fire.
39:01
Anyway, >> Adlo Low has some data.
39:03
SpaceX, the current approximate price to sales is 150 X. Amazon's 3. 6. Microsoft, 9. 2.
39:15
>> See, people read this as a bear SpaceX take, but imagine if Amazon started trading at SpaceX's price to sales. >> Yeah.
39:23
>> It'd probably be like a hundred trillion-dollar company.
39:25
Anyway, our next guest might be building the next hundred-trillion-dollar company.
39:29
We have Payton Case from Dispatch here, building re-entry vehicles for returning space [music] manufactured payloads in semiconductors, biotech, and pharma.
39:37
Welcome to the show, Payton. How you doing? Oh wait, sorry.
39:39
Do I have the wrong person?
39:42
>> Wrong I think there was a mix-up with the speaker. >> switched it around. Ephraim Torres. Sorry. Thank you.
39:45
Please, introduce yourself for us so we get it correct. >> Yeah, so hi everyone. My name is Dr. Ephraim Torres.
39:51
We're from Alianza building whole-body mobile MRIs for cancer screening. >> Amazing. >> There we go.
39:57
>> Are there any downsides to constantly getting MRIs?
40:00
>> No, so MRI is non-cancer-causing radiation.
40:03
CT and X-ray, there's limitations, but MRI, I mean, I I've scanned myself thousands of times with >> [laughter] >> Okay, so mobile >> person in history?
40:15
>> No, my professor takes that one.
40:15
He he's he likes to tell he's the most scanned and published brain in the in the history of mankind.
40:21
>> times a day or something. >> Yeah.
40:22
Yeah, that's how you get it. Yeah.
40:23
>> How How mobile are we talking?
40:23
Are we talking mobile like uh it can be in a truck that comes to the town and you go like getting your body fat measured in a water tank or are we talking like Fitbit I clip it to my my waistband and I'm constantly getting MRI'd?
40:40
>> Yeah, no we're talking trailers.
40:40
So, pulled by like a Ford 350, shows up outside of a clinic. >> it up. I like the Ford 350. >> There you go, right?
40:46
We We actually calculated it just for that. >> Yeah. Okay.
40:50
>> whole body screen, $250, and there you go. >> 250, okay.
40:53
So, what I'm getting a little feedback right now. Can we deal with that? Thank you. Um So, yeah. Sorry.
41:01
>> What does a normal MRI cost? >> Mhm.
41:04
>> Yeah, I mean Prenuvo, if you look at their pricing, they're $2,500.
41:07
And it can go up to $3,500.
41:07
So, we're we're on 10 times cheaper than everything on the market.
41:12
>> And what is driving that?
41:17
>> Yeah, so there's two things.
41:17
The first thing is our technology.
41:18
Like our system is 80% lighter, consumes 60% less power.
41:24
It's actually eight times quieter, too. >> Mhm.
41:27
>> Uh and all of this lets us have the operational gains.
41:29
So, we don't sell the systems, we sell scans.
41:32
So, it makes our internal operation costs really low. >> Interesting.
41:37
>> And the shelf life of these systems are 10 to 12 years.
41:39
So, we can charge 250 a scan and actually our gross margin actually ends up being 55% because of how long these systems last.
41:48
>> Do you have to go through medical device approval with the FDA? >> Yeah.
41:51
No, we're we're going through medical device approval next year as a class two 510k.
41:53
It's a fairly straightforward path because of the fact that there's a lot of regulatory precedent. >> Yeah.
42:00
>> Where it is regulatory risk arises when you're like the first MRI, first therapeutic, and things like that.
42:05
>> Well, then what about >> Okay, so what's what's the backstory on the on the company and the IP?
42:08
Did you cook this up with your professor?
42:10
Is he is he involved with the the business?
42:14
What's what's the history?
42:15
>> Yeah, no, not the professor. He's not involved.
42:16
So, me me and my co-founder have known each other 10 years, went to grad school together specifically to spin out a startup to disrupt the MRI industry, if you think about it.
42:24
And so, we developed the IP in grad school, got that patent issued.
42:29
Adela has exclusive rights to it.
42:33
And yeah, so it's been it's been cooking for a little good bit here.
42:34
But, MRI is a hard problem to solve and that's why it's been taking us. Yeah, doing well. >> So, >> Very cool.
42:40
>> You're So, you're going through FDA approval.
42:42
Can you actually sell the product in some advanced form yet?
42:43
Or is it just like demonstration for medical for like research purposes at this point?
42:52
>> Yeah, so I love this question because it gets to one of the the the creativity of of our company.
42:56
We are deploying this year, but it's a traditional MRIs. >> Oh.
43:00
>> The traditional MRIs, we're going to put them in semi-trucks and it's all FDA cleared.
43:03
We can go to our customers.
43:03
We have 11 LOIs already, 9.
43:06
75 million, and start building that distribution channel now. >> Yeah.
43:12
>> And over the next year, right, we're going to get 5 to 10 of these trailers out there, all breaking even.
43:15
But, then come Q1 2028 when our product is cleared, you just switch it and it's like a lever to profitability. >> That's amazing. >> Wow, cool. >> Congratulations. >> Yeah, cool. >> Well, thank you.
43:26
>> How's the fundraising been going? >> It's been going well.
43:29
We have We only have a small amount of allocation left of our non-leads and having a lot of exciting conversations with potential leads.
43:37
>> Are you more Are you seeing more interest from investors who have invested in health tech, medical tech, FDA approved devices, that crowd?
43:46
Because or or or are there tech investors who are sort of exhausted with the AI stuff and want to broaden their horizons?
43:55
>> Yeah, honestly, we're getting a lot of interest from deep tech, generalists, and just tech.
43:59
Because MRI is very well known in this space. You have Pernovo.
44:04
Everyone has a story of someone that didn't get an MRI in time, whether it be from like a sports injury to something more severe like uh the cancer wasn't caught in time.
44:13
And so we're we've had interest from deep tech tech investors, generalists, uh health tech as well.
44:20
>> Well, congratulations. I got to know.
44:23
>> Yeah, so so all credit goes to my wife.
44:26
So Adelante stands for a couple things.
44:27
Our scientific approaches are known as radio frequency adiabatic pulses.
44:32
And my uh my my parents saying is siga adelante, which in Spanish is keep going forward.
44:37
Also, tattooed on my forearm here. >> There we go.
44:41
>> And so Adelante is very close to Adelante, which means go forward in Spanish.
44:45
And it kind of goes that no matter what happens to us, we're just going to keep on making progress every single day. >> Very cool.
44:51
Thank you so much for coming on the show.
44:53
>> Logo logo chest piece. >> There you go.
44:56
This is repping the original repping the original. There you go.
45:00
>> Have a great rest of your demo day. We'll talk to you soon. >> Let's go.
45:04
Um up next we have a good buddy of mine, Russell Smith from Nine Mothers. He's back in YC.
45:12
I went through YC with him in summer of 2012.
45:17
>> [snorts] >> 14 years ago. Overnight. >> Overnight success.
45:23
>> Uh but I'm excited to catch up with Russell Smith, introduce him to everyone. >> Tyler was was what? One or two?
45:30
>> He was probably 7 years old or something. >> boy. >> years old, yeah.
45:36
But he's working on AI mission systems for >> Can we get Tyler in here for >> focused on counter drone protection. Yeah.
45:41
Yeah, in between the next guest let's slot in some Tyler for sure.
45:45
Anyway, we have Russ Smith from Nine Mothers in the TV PN Ultra Dome at YC Demo Day. How you doing, Russ? >> Good to see you. [music] Good to see you. Long time. >> Been way too long.
45:55
Thank you so much for taking the time.
45:57
I'm glad we can make this happen.
45:59
Uh Uh, for those who don't know you, introduce yourself.
46:01
Give us a little bit of the the YC history, the entrepreneurial backstory, how long you've been an entrepreneur, and then take us through the current company.
46:09
>> Yeah, I mean, I was an entrepreneur before I did YC. So, like in in the UK. >> Yeah.
46:14
>> But, got into YC in the same batch as you.
46:16
That's how we met in summer 12. >> Yeah.
46:19
>> The batch that basically broke YC at the time and made them re-change it.
46:22
But, >> 70 companies looks quite small right now.
46:27
>> [snorts] >> So, YC had been like 30. >> Yeah.
46:29
Yeah, you >> You can tell it.
46:30
>> Yeah, it scaled and then they decided to change how it worked.
46:32
And it's the genesis of how they do groups now, right?
46:36
It was basically a free-for-all at the time where the loudest companies or the most like intense ones would get the most Well, not deliberately the most attention, but would would >> Yeah, it's sort of natural. >> Yeah.
46:48
>> Get the most love, right?
46:49
>> It's funny cuz it was the YC batch that broke YC.
46:51
Everyone said, "Oh, YC's over.
46:53
It's it's you know, it's gotten too big.
46:56
It's" And then it was like Coinbase, Airbnb, or Coinbase, InstaCart, Zapier, couple other companies that came became huge. >> Clever. >> Clever, yeah. >> Benchling.
47:05
Like a bunch of >> Yeah, there were a bunch of great companies that came >> A bunch of decacorns and unicorns in that batch. >> It was good.
47:11
So, >> West Side on as well, right?
47:12
As in I remember going to your um going to your Tenderloin office and carrying bags of your early product out in little bags.
47:23
And >> 1,500 bucks a month for three people living in San Francisco.
47:29
>> Oh, it's a good memory. >> I remember that.
47:30
You guys Didn't you move in there when you had like eight 18 grand or something?
47:35
>> Yeah, I think we had like 20 grand left in the bank. >> like, "Good.
47:37
This will last us like 18 months." >> Yeah. Yeah.
47:39
Yeah, we paid our rent a year in advance, owned our laptops.
47:41
We just had to pay internet and food, and that was it.
47:45
It was pretty pretty good life.
47:46
>> That's where West Side came from, right? It's like just eat that.
47:50
>> Anyway, we're not here to reminisce about the old times.
47:51
Tell us about Nine Mothers.
47:54
>> Yeah, so we We AI mission systems for the DoD.
47:55
and our first product is counter drone.
47:59
And we make a very small robot. So, it's 35 lbs.
48:02
We sell it for about 150k, and it's capable of defeating multiple fast-moving drones day or night. >> Kineticly? >> Kineticly defeat.
48:11
So, yeah, it's a basically a gun on a robot, and then we build all of the models for day, night, build acoustic sensors, build models for that, and then basically capable of shooting down small fast targets. >> Interesting.
48:25
Is it >> Can we pull up the video cuz I have no idea what this robot looks like?
48:29
>> Yeah, let's pull up the video and you can kind of narrate it. >> have it. >> Oh, yeah, yeah.
48:33
Um we'll we'll we'll have the team pull up the video.
48:35
I'm curious about the decision around acoustic models versus video models.
48:41
There's so much energy around >> We do all of them. >> You do all of them.
48:46
>> like the the key here is that no sensor is perfect, right?
48:48
And so, multiple sensors gives you more chance of finding something.
48:52
And then, for instance, acoustic is bad on some of the projects where we're doing that are around turbines, right?
48:57
On Chinooks or other vehicles because it gets drowned out.
49:02
But then, radar is bad in some environments, and vision is bad in some.
49:06
And so, the fusion, the ability to fuse all that together into a coherent picture, and also adapt to new sensors means that we can stop more things, right?
49:15
And the key here is that this is kind of like the same problem that you saw in Iraq with or Afghanistan with IEDs.
49:22
These are just now flying IEDs, and all the demos you've seen existingly are almost all of slow-moving targets.
49:31
So, like sub-10 m/s, sub-10 mph in some cases drones people are struggling to shoot down.
49:36
Um and that's just not reality, right?
49:39
As in we we've been shooting and demoing as in we we shoot faster internally, but demoing 65 mph small drones repeatedly.
49:46
Like uh and that's way closer to reality if that makes sense. Right? >> the name come from?
49:54
>> Dude, it's it's Norse Norse mythology.
49:56
So, we we're nerds and then our our product names are all around the same mythology. >> Okay. >> I like that.
50:03
>> naming's hard, but yeah.
50:03
That's That's where it came from. That's the story. >> That's good.
50:07
What What does it actually shoot? Is it shooting like 5.
50:08
56, like some commodity round?
50:12
>> We can adapt to anything, as in we can do 5.
50:15
56, but the the thing that works the best is uh 12-gauge.
50:17
And so, we make uh our own We use a gun off the shelf at the moment.
50:23
We're also developing our own belt-fed shotgun system, like as in the world's first belt-fed.
50:28
And that will be first firing in the next 3 weeks.
50:32
We also make ammo, right? Uh >> You make ammo?
50:36
>> Yeah, that it's basically closer to match grade, which is like tighter tolerances and then slightly higher pressure.
50:42
But owning everything, like the full stack, that means it means we have better results is the short version.
50:48
>> So, where do you guys go to >> and it's for defense, right?
50:51
>> I mean you're you're obviously very experienced founder.
50:53
Um where is the company right now?
50:55
Do you already have facilities set up, a staff hired?
50:57
Like I imagine that you're pretty far along.
51:02
>> So, YC, we're a little later on.
51:02
So, we are um we've sold like uh $1.
51:05
6 million of stuff to the DoD, as in direct sales of units, not uh not research and dev stuff, like actual sales.
51:15
Delivered units to DoD and then we're expecting to sell over 100 units this year and 1,000 next year.
51:22
Have multiple believable paths to both, but yeah, aim is to do over 100 mil of rev next year and it's looking completely believable. Should hit 50 this year. >> Super impressive. Question for you.
51:33
How, let's say let's say there's a front line and you set up a you know, I imagine, you know, let's say US military sets up a bunch of these, drones are flying over.
51:42
How do do manage uh friend like uh like friendly fire?
51:48
Like let's say a drone passes the line, there's actual troops back here, and you want to take out the drone, but you're effectively shooting rounds into the air.
51:59
>> That's a great question.
51:59
And the the it's a complicated answer.
52:02
And it depends on the mode the system's in.
52:03
We can ignore stuff that's flying away from us, and only prioritize stuff that's coming towards us.
52:11
We can also take signals off networks they have if they know which drones are theirs.
52:16
Really, the the common thing is that they don't actually have that kind of data.
52:20
And so, the operator can choose to not run it full automatic, and then choose which targets, but um mostly they will shoot them because of blue on blue risk.
52:29
If it's not drones they are physically flying in the same group, right? It's that's the problem.
52:33
Is is it a friendly drone that's misidentified you or not?
52:36
If it's on a network and we know it's not, has it still misidentified you?
52:41
Uh that's where you get into the problem of this of this kind of range, right? >> Mhm.
52:46
Well, congratulations on the progress. Really exciting growth. Great to catch up. >> on the progress.
52:51
>> on the show, >> [clears throat] >> and we'll talk more soon. Have a great one.
52:55
>> Yes, great to catch up. >> See you soon. Goodbye.
52:58
Uh let me tell you about CrowdStrike.
53:00
Your business is AI, their business is securing it.
53:02
CrowdStrike secures AI and stops breaches.
53:05
Uh our next guest is Payton Case from Dispatch.
53:09
I accidentally introduced him a little bit too soon.
53:15
But we got him sitting down in the YC Demo Day. >> What's going on? >> How you doing?
53:21
>> Yeah, it's good to be here. Good to see you guys. >> Good to see you, too. Introduce yourself. Introduce the company.
53:25
Tell us what you're building. >> Yeah, so I'm Payton.
53:27
I'm the founder of Dispatch Space.
53:29
We build satellites for manufacturing products in space, and these are for the most advanced materials in the world that can only be made in microgravity, and we bring them back down to Earth.
53:40
>> What specifically are you building?
53:41
Because there like the space economy has gotten so fractured this point there's you know multiple launch providers there's satellite bus providers there's impulse space Tom Mueller has a extra propulsion system that you can bolt on like what is the key product that you're focused on for this early stage of the company?
54:02
>> Yeah, we build the re-entry vehicle.
54:02
So this is the satellite is in space you've made your product and now you need to get back down to Earth. >> Mhm.
54:08
>> You're flying at Mach 25.
54:08
You're surrounded by a plasma that's 3000 degrees. >> Mhm.
54:14
>> And we build the heat shields and satellites that can survive that environment. >> Mhm.
54:18
>> Who is doing stuff in space?
54:18
Like I live in the world of Varda very closely and it seems like >> in the room is that we are we are very familiar with this category because Dalian is our friend.
54:28
>> And and it seems like obviously they're going vertically integrated building the re-entry vehicle and also doing the contracts with biotech companies and and pharmaceutical companies but it does seem like they the the the industry is expanding.
54:42
So who are the other buyers that aren't working with Varda that you have an opportunity to to work with?
54:49
>> Yeah, the biggest players are semiconductors pharmaceutical and biotech.
54:51
Varda is very vertical and that pharmaceutical application.
54:54
We're big we're the biggest bulls on the semiconductor space.
54:59
We think that the regulatory environment makes it so that you can come to market a lot faster and the applications of growing those gallium nitride and indium selenide crystals in space are massive and that's where that's where we're bullish on it.
55:14
>> Massive I'm I'm down semi everything that touches semiconductors is massive.
55:18
You say semiconductor you're a trillion dollar company but timelines the timelines like it feels like we're a decade away from making a chip in space making a chip on the moon like even even the big SpaceX bulls are saying like okay I'm actually doing the mass driver that's maybe more than 10 years away.
55:34
Let's focus >> Also maybe another question is like what are you talking about this demo day?
55:39
What are you what are you hearing?
55:41
>> Yeah, so we have a pilot mission that we're flying with a paying customer to grow semiconductor crystals in space and we're not talking about doing like the lithography [snorts] or assembling iPhones in space.
55:49
It's about it's earlier in the supply chain.
55:53
So chips come from wafers.
55:53
Wafers actually come from these cylindrical crystals and when you grow those in microgravity you get up to a thousand times fewer defects.
55:59
So you grow those crystals in space, bring them back down to earth and then you cut them into wafers and that is actually happening now on the ISS and these companies are looking to scale.
56:08
They just don't have the vehicles to do it. >> Oh, very cool.
56:12
>> How did you make your first dollar?
56:14
>> [snorts] >> The first dollar was the deposit on the pilot program. >> no, in life in life.
56:17
I want I want the I want the founder origin.
56:21
>> [clears throat] >> Oh, yeah.
56:21
It was probably working in a smoothie shop that I totally loved the smoothies of wink wink.
56:28
I I was you know, I made a few tips and that was that was about it but uh >> You you realized you weren't you realized you weren't cut >> out for the smoothie business.
56:35
You were meant to go into semis.
56:38
>> You were meant to go to the heavens.
56:40
>> Yeah, fab fabs in space are a little easier than getting tips out of smoothie shop for me. >> That's amazing.
56:46
What's the state of the the space investors that have attended demo day? Are you seeing traction?
56:51
How's the fund raise going?
56:55
>> Yeah, the fund raising's going great.
56:56
Obviously IPOs are very useful for us.
56:59
So that's been great indicator of where the entire market is going.
57:02
We're getting close to closing out that round which is super exciting for us and like really that goal is getting back to work as quickly as possible and using that money to go build great things in space. >> That's fantastic.
57:14
>> Dan in the chat said from smoothies to a smooth operator.
57:17
>> [laughter] >> I like that.
57:18
>> Well, thank you so much >> Great to meet you Peyton.
57:20
Congrats on all the progress. >> Have a great one. >> Thanks so much.
57:23
>> We'll talk to you soon. Goodbye.
57:26
Our next guest is Akshay from a drone building cooling systems for data centers >> He is working on I I I'm assuming he's working on reducing water consumption in data centers so that almonds can >> Oh yeah.
57:39
Yeah, yeah, this guy's an almond industry plant for sure.
57:41
Anyway, let me tell you about Railway first.
57:45
Railway is the all-in-one intelligent cloud provider.
57:46
Use your favorite agents to deploy web app servers, databases, and more while Railway automatically takes care of scaling, monitoring, and security. Thank you, Jordi.
57:57
Let's bring in Akshai from Madaaron. How are you doing? Welcome to the show.
58:02
Thank you for taking the time. >> What's up? >> Hey guys.
58:05
Huge fans, so I appreciate the opportunity to talk to you guys. >> Fantastic.
58:07
Glad to have you on the show.
58:10
Introduce yourself, introduce the company.
58:11
I have a tons of questions, but let's start with the basics. >> Sounds good.
58:14
So, I'm I building Madaaron.
58:16
We're building hyper-efficient cooling for data centers.
58:18
So, specifically we've engineered a thermodynamic process that works really well in hot and dry climates, which is where most of the hyper-scaling's happening right now.
58:25
And yeah, it's we have our demo that's running live at Demo Day today.
58:29
So, we're actually really excited to show people in person.
58:33
But, the big problem really is that data centers are limited today by power and not by chips or land.
58:36
So, cooling and power are two sides of the same coin.
58:40
If you can save power on cooling, that's more power for your flops, and that's where our real value unlock is.
58:44
So, people can install more GPUs given the same grid permit, which takes years to get.
58:48
To give you a sense of the scale of the problem, last year in Texas, Semianalysis said that there were 150 gigawatts worth of load requests to the Texas grid.
58:56
Texas grid on a good day 60 gigawatts, and only 1.
58:58
5 gigawatts worth of those requests were actually approved by the local utilities.
59:03
So, it's a crazy scrambling time.
59:05
Like Elon Musk was probably the first person to kind of come up with a method of putting engines on the back of trucks, rolling them out to data centers for power.
59:13
You know, Boom Supersonic, whose ultimate goal is to be building supersonic jet planes, has had a slight pivot to selling supersonic jet engines, and apparently they're crushing it.
59:20
So, it's it's a crazy time, and it's a it's the first time in a long time where a new company come can come into the market and and build a thermal industrial company.
59:29
>> So, what is the bottleneck for for you?
59:31
Is it figuring out where your system, you know, what data centers your system can fit in?
59:35
Is it actually just how you have the demand and you're trying to meet it?
59:39
Like, what does your supply chain look like?
59:40
Like, what's standing between you and let's say not this round right now, but, you know, the next one?
59:47
>> Yeah, it's a great question.
59:47
So, we actually scaled our 1 kW prototype 100 times during the batch to 100 kW prototype.
59:52
We're going to be deploying our 1 MW version um very, very soon.
59:54
The 100 kW prototype that's actually running live at demo day right now is going to be running our first pilot in 2 months.
1:00:01
So, really it's going to be uh between the 100 kW and the 1 MW prototype, it's going to be figuring out how to elongate it and make it taller.
1:00:07
So, we've done the really hard work so far, but really it's just building a physical big version of it so that um we've talked to hyperscalers, their feedback is they just want a bigger versions.
1:00:15
They can cuz they have such a huge demand um they're not really interested in 100 kW, they're interested in 100 1 MW. >> Yeah.
1:00:22
>> Okay, so 1 MW will be enough to get your first real, you know, orders, revenues with hyperscaler type customers.
1:00:29
>> Yeah, all the data center campers uh campuses would say, "I'll take 10,000, please, because I'm building 10 GW."
1:00:33
I mean, basically chain them together, right?
1:00:36
Uh but this is I mean, we saw in the video, uh it looks like a shipping container, and essentially the the input output The output is just cold water. It takes in water.
1:00:44
So, you are agnostic to the design of what happens in the data center, I imagine.
1:00:49
You're not You're not dependent on any particular chip or rack design.
1:00:53
Um but then, what energy is actually going into your system? >> Yes, exactly. It's a great question.
1:01:00
So, our the energy is used to be uh the path fans and the pumps.
1:01:04
So, actually circulating the fluids through the system.
1:01:07
If I may brag about my co-founder a bit, we don't just design the the physical box.
1:01:10
We actually He actually designed the thermodynamics, the mechanical structure, the electronics to power it all, and then also the software to control it.
1:01:17
Uh we do this all in-house.
1:01:19
We're We're Tesla fanboys.
1:01:20
All our competitors are outsourcing every single level of this engineering out and they're just integrating that and selling that as a product.
1:01:26
So we've been able to get a lot of efficiency gains by just designing this all in house with two people so far.
1:01:30
We're fundraising and we're going to hire some more people, hire our friends in the Bay Area and building the 1 MW one with our own hands. >> Fantastic. >> Amazing.
1:01:37
>> and so they they're there's already a lot of energy on these campuses that you can draw from.
1:01:41
So uh whether it's natural gas powered, powered from the grid, powered from nuclear, solar, whatever's going on, you're drawing from that but your goal is to just draw more efficiently and take less of the power so that can probably just go into the chips, right? >> Exactly, yeah.
1:01:57
You get a lot more inference value out of redirecting that power to your flops. >> Okay.
1:02:02
And then in terms of uh how you're pitching yourself at at Demo Day, are you uh on the path to LOIs with hyperscalers?
1:02:08
Are you uh working backwards from are you doing business with neo clouds?
1:02:13
Like what's the walk crawl run to actually create the economic flywheel to raise money and then go build this thing?
1:02:19
>> Yeah, great questions.
1:02:19
We've already started conversations with two hyperscalers.
1:02:21
We're actually talking to a third one this week uh after Demo Day, which is super excited about. Um Let's go.
1:02:28
Um one of our investors actually we closed a check today.
1:02:31
They're actually building $20 worth of data centers in Texas, so um that's been really nice.
1:02:35
But the really first Yeah, fantastic.
1:02:38
Um the first thing for us is really going to be focusing on our pilot, just demonstrating that we can plug into any data center at scale, do it reliable reliably and at scale with our investor that we just partnered with today. >> Yeah.
1:02:48
And then what type of uh efficiency number actually draws the attention of a potential buyer? Are we Is 1% enough? Is it 10%? Is it 50%?
1:02:57
Like what what's reasonable cuz I imagine you come in we're 99% more efficient everyone's like, yeah, that's not real.
1:03:07
Uh but but is is is one Are we doing basis points here?
1:03:10
Like how how how much of an impact do you need to have to actually move the needle?
1:03:14
Cuz some of these projects are so big, their bill, their bill for electricity might be, you know, hundreds of millions of dollars. >> Yeah, exactly.
1:03:21
Like guys, it's so crazy.
1:03:23
My competitors are 100-year-old companies that have been designing the same thing for decades.
1:03:26
This is a thing called a mechanical chiller.
1:03:28
It's literally the same thing as your refrigerator at home, and it costs $500 million for gigawatt.
1:03:33
So, people are really desperate to get away from these chillers and look for different types of cooling because [snorts] that's actually eating up your grid permit.
1:03:39
So, that's the thing that actually costs 30% of your grid permit, and we can do it for cheaper, and we can actually have better OPEX as well.
1:03:45
Um so, really any percentage is okay.
1:03:47
I think that like you can't quote like 0.
1:03:49
1% gain, but like, you know, people are thrilled if you have a 10% efficiency gain on that.
1:03:54
>> also, we're just in a supply crunch.
1:03:54
So, even if you just said, "Hey, we're we have the exact same thing, but it actually will ship in the next couple months."
1:04:00
A lot of people might jump at that.
1:04:02
So, that's the benefit of being in the >> What What were you doing before this?
1:04:06
>> Yeah, so I was actually scaling manufacturing at QuantumScape.
1:04:07
So, I was doing computer vision, working directly under the CTO, Tim Home.
1:04:10
Our founder CTO took it all the way from inception to IPO.
1:04:14
And I also did grad school setting material science.
1:04:16
There's a material science to this company that we didn't get to talk about today, but we're we're doing something cool. >> Very cool. >> Very cool.
1:04:21
We'll have you come back on after you raise, and it was great to meet you. >> Yeah, fantastic. >> guys.
1:04:26
>> We'll talk to you soon.
1:04:26
Uh we're going to bring on some YC partners in about 4 minutes. Stay tuned.
1:04:30
Uh in the meantime, we can go back to the timeline, back to the news. >> Talk about specs.
1:04:38
>> Uh >> This is from Evan Spiegel.
1:04:41
Yes, and the Governator reported it was in >> specs are official.
1:04:43
$2,195 all-in-one AR glasses that Evan Spiegel has dubbed the next computer. >> $2,200.
1:04:55
That's almost Apple Vision Pro numbers. That's expensive.
1:05:00
Uh it's going to be a left. I feel like it's a lot.
1:05:04
I It It It seem It seems like a lot of money.
1:05:08
Um It's got to be very >> Pro starts at $3,499.
1:05:13
So, a bit of a jump, but but this is a product that seemingly is trying to compete in the realm of like a it's a it's a mobile device.
1:05:21
It's naturally a mobile device.
1:05:22
Unlike the Apple Vision Pro, which obviously has some viral images on launch of people walking around with it, but >> I'm just thinking about like like there are a lot of Apple fanboys who buy every >> What?
1:05:34
>> Get this guy on right now. >> What? >> Pull him up. >> Hey, what do you say?
1:05:37
Are you buying the Snap Spectacles $2,200?
1:05:41
Are you spending your paycheck on that?
1:05:45
>> I mean, they they I think they actually do look really cool.
1:05:48
I I don't know like I was looking at some of the product demos earlier.
1:05:52
Um Some like the game features look really cool. There's like ping pong. >> Yeah. >> Two 2.
1:05:56
2K is like a little pricey personally.
1:05:59
>> But if you can watch Lawrence of Arabia from start to >> Yes. Yes. Yes.
1:06:02
If we bought it if we traded you your phone for a pair of these for a week, [laughter] would you demo them?
1:06:09
Would you demo them for a week? No phone. >> No phone.
1:06:12
Would you >> Would you commit to that? >> texting on it? Can you call? >> You don't need to.
1:06:16
You can go without texting for a >> You have Lawrence of Arabia. You don't need a phone. >> That's true.
1:06:20
I can watch Lawrence of Arabia like, you know, >> What's the battery life of the show? During the show.
1:06:25
>> Snap Spectacles battery life. Specs battery life.
1:06:28
I got to I got to >> So, what happened?
1:06:29
Wasn't there some conversation that Spectacles might spin out? >> Up to 4 hours.
1:06:34
That's Lawrence of Arabia right there with a little intermission.
1:06:38
>> I remember correctly, there was some like rumors >> Yeah.
1:06:42
>> that that Spectacles would be spun out.
1:06:45
I remember at least one article. That has not happened. >> I don't think so.
1:06:49
>> Uh and so the stock is down 7% today. >> Mhm. >> Um >> I don't know.
1:06:56
The the the the trick is that you have Apple fanboys who the of you know, they have a lot of Apple fans, but some of them are wealthy.
1:07:03
Some of them buy every product.
1:07:05
They buy a new phone a new iPhone every year, they buy the top of the line MacBook, they have the Mac Studio and the Mac mini just for fun.
1:07:13
And like that's a whole class of consumer for Apple.
1:07:15
And so when they come in with something that's a little crazy like a $10,000 gold Apple Watch, like they'll sell a couple of them.
1:07:21
When they come in with a $3,000 VR headset, like a couple people will just be like, "Yeah, I'll give it a try."
1:07:28
Uh when you're talking about a new company entering uh hardware, Meta I think did a better job coming in with like, "Yeah, it's just a pair of sunglasses.
1:07:36
You need a pair of sunglasses anywhere anyway." >> in it.
1:07:40
>> We put a camera in it.
1:07:40
It's $100 for the version that you know and love, the Ray-Ban Wayfarers that don't have a camera in them.
1:07:46
Ours are at a couple hundred extra bucks.
1:07:48
It's still something you could give as a gift.
1:07:51
>> for them to lose money on every single device effectively forever. >> Totally. Yeah.
1:07:55
And so and so it's a lot easier to get into that like Meta ecosystem just saying like, "Yeah, throw a camera on my uh on my Ray-Bans. I'll give it a try.
1:08:05
Maybe I'll churn, but if it's collecting dust in the in the cabinet or in the in the sock drawer, you're a lot less like, "Ah, I really got burned."
1:08:12
And and like the Apple fanboys that you know, a lot of them took them back, but they're like, "Yeah, that was still like a cool experiment." Makes up me. >> Cuz I I got a watch.
1:08:22
>> Well, Tyler, once you're back in town >> Wait, what was that?
1:08:26
>> Lord of the Rings extended cut. >> Ooh.
1:08:27
>> I think that's that's like 4 hours.
1:08:30
>> You can't watch the whole thing on the whole trilogy.
1:08:32
>> Once you're back in town, let's pick up a pair. >> Yeah.
1:08:35
>> Tyler can live with them.
1:08:35
We won't say a week, we'll say 48 hours. >> Exclusively. >> Exclusive.
1:08:40
Your phone >> We take the phone >> need the phone to to to do anything.
1:08:42
I think a lot of the computer have >> 48 hours I I think it's actually like not very hard.
1:08:48
>> That's just a digital detox. >> Okay.
1:08:49
And then then you're down. It's like one weekend. >> You're down? >> I could do a week. I could do a week.
1:08:52
>> That's like 10 showings of Lawrence of Arabia.
1:08:54
>> I'm not asking you to do a week.
1:08:54
If you want to do a week, we we can do it. Okay, he's doing it.
1:08:58
>> I'm hearing I'm hearing 4 weeks.
1:08:58
I'm hearing a full month now. >> 4 weeks.
1:09:03
All right, it was great to see you, Tyler. We miss you. >> Great to see you.
1:09:05
>> Uh I'll see you later.
1:09:06
>> Hopefully the show is not the same without you. >> Yeah, it really is.
1:09:07
John and I were kind of messing around before the show and we realized when Tyler's not here there's there's nobody super close by to laugh at our bad jokes. So, >> Yeah. >> it's a bit rough.
1:09:19
>> Spiegel called the Specs both very, very wearable and highly capable, which he said gives Snap an opportunity in a market that's focused on either very large and clunky headsets that are super capable or very lightweight glasses that really don't do much. So, it is interesting.
1:09:32
Uh I was reading the coverage um of uh of in uh there's some videos here in Upload VR uh and it shows sort of the the the process of this.
1:09:43
The HoloLens 1 from Microsoft 2016 uh was 580 g.
1:09:50
Snap's Specs are 132 g, so they are light.
1:09:53
Now, the the Meta Ray-Ban display is 70 g, so about half as heavy.
1:09:57
So, these are heavier, but they're nowhere as heavy as a HoloLens or a real VR headset.
1:10:06
And uh it checks a lot of the boxes on field of view and we'll see we'll see what the developer ecosystem's like.
1:10:12
I hope someone comes up with some interesting thing.
1:10:14
I hope that there's a YC company that builds on top of this exclusively and uh and has some sort of breakthrough user interface experience some some killer use case that comes from the community.
1:10:26
>> to wait to see how many of these sell.
1:10:28
>> Yes, that will be that will be >> going to need I mean even with a million a million sold, it's not a very big user base. >> It's a lot of money.
1:10:34
Let me tell you about Console.
1:10:35
Console builds AI agents that automate 70% of IT, HR, and finance support, giving employees instant resolution for access requests and password resets.
1:10:42
And without further ado, let's bring in Diana here from YC.
1:10:47
She's a managing partner.
1:10:47
Diana, welcome to the show. How are you doing? >> Good. Thanks for having us.
1:10:52
>> so much for taking the time. >> How is today?
1:10:55
>> Yeah, how's Demo Day going?
1:10:57
>> The energy and vibes are immaculate. >> Mhm.
1:11:01
What is it How does it compare to your YC experience, your entrepreneurial journey?
1:11:04
Tell us a little bit about that and then take us through um how you're talking to today's entrepreneurs about what's changed, what's the same.
1:11:14
>> It's kind of fun that you were just talking about Snap because my company was building augmented reality SDK >> Yeah.
1:11:22
>> for game devs back in the era of HoloLens. >> Yeah.
1:11:26
>> So, my company went through the batch back in summer '17. >> Mhm.
1:11:31
>> And back then, the it was it was different.
1:11:35
It's way smaller than what it is now and AR still taking time to get to the headset.
1:11:43
And when we went through it, Demo Day was back in the Computer History Museum back in Mountain View. >> That's right.
1:11:48
>> And now we got our campus here in San Francisco and have way more investors and companies that are raising a lot of amount that probably was more Series A when I was doing when I was running my company. >> Yeah. >> So.
1:12:03
>> What was the what was the mood like around like platform risk, building on top of something else?
1:12:07
Obviously, a lot of the augmented reality companies um like Niantic built on top of the iPhone, on top of smartphones.
1:12:15
Uh they and then now we see AR sort of, you know, trying to break in through new devices, specifically spectacles, headsets, um wearables.
1:12:25
But was that a risk factor that came up in pitching VCs or was there sort of like okay, there's enough of an ecosystem here, there's enough of a an enterprise play that you'll be able to uh you know, be a winner no matter if there's one platform that breaks out?
1:12:47
>> I think it's a very good question.
1:12:47
I think it's the same question right now that a lot of the AI companies are wondering whether they're on the path of the road map for the big labs. >> Yeah.
1:12:58
>> We had the same issue when one fun fact, maybe not so fun, but on the first day of the batch when we went through it, we basically had built the same platform that Apple ARKit released. >> Yeah. >> Exactly same. It was the same SDK. >> Oh, no.
1:13:16
>> And on that first day of the batch, we actually freaked out because you have this giant company that has infinite amount of money that could just crush you.
1:13:26
And I think what that forced us to do was to really accelerate a lot of our road map because we had thought of building basically this SDK that would enable anyone to build code once and run on any hardware.
1:13:40
So, we were the first SDK that could enable running it across you you build the code once and it will ship on Android and iOS and eventually also got it to headset.
1:13:49
Then later on our company had an exit and got acquired by Niantic, the makers of Pokémon Go, which was the biggest user of our AR back then.
1:13:56
And then I ended up running um a lot of the AR and engineering teams for for Niantic.
1:14:08
>> Uh we had Andrew Lee from Tasklet on first and I really appreciated how he just straight up said, he's like, "Yeah, we are in the path of >> Oh, yeah.
1:14:17
>> Tropic and Open AI and we're just we're where we are competing uh but just sort of accepting that and and workflow automation what what they're doing such a big category can obviously with great execution build a build a big company even even despite of that.
1:14:31
Um what are some of the key themes for the batch?
1:14:36
How does this batch compare to the last batch?
1:14:38
What kind of trends are you seeing overall?
1:14:43
>> I think this batch is uh following a similar trend to the winter 26 batch where things that have been happening, a lot of these companies are the first one that are basically riding the wave with agentic coding working.
1:14:57
It is it has become the norm where company Well, the norm has become more common that companies can go to zero to seven figures in revenue within just 3 months, which when I did the batch, that would have been impossible.
1:15:12
I don't think any companies did that.
1:15:14
The best companies back then would grow, let's say, 10% week on week, which is what, let's say, Airbnb did back then, and that would get them to a couple hundred thousand in ARR, which is a very good very very very impressive accomplishment back then, but now companies get to seven figures because the companies are able to build a more mature product a lot quicker with with agentic coding.
1:15:39
If they find the right user and customer sales and nail nail on that, people can really speed through this right now.
1:15:50
>> How How often How often do you do you find yourself talking to a company in office hours that you think shouldn't be optimizing for that?
1:15:58
Because there's a lot of companies that, you know, we've talked to today, like Madrone, for example, like very important uh sort of product category, clearly massive TAM, uh and they should go as fast as possible, but if they just optimize for revenue uh traction right away, it would take them on the wrong path, I imagine. >> Oh, absolutely.
1:16:19
So, this is where we give very custom advice depending on the type of company.
1:16:24
If you're building, let's say, core infrastructure or defense type of applications, it's more important that you deploy deeply into few customers, and it doesn't matter if the revenue is small, but it has a lot of opportunity for growth.
1:16:44
And it really depends on the journey.
1:16:47
So, this is not advice for all the companies, for for some of them. >> That makes sense.
1:16:52
>> the YC has gone through waves of like consumer boom in the early days with Airbnb and a lot of consumer companies and then sort of swung to business-to-business products and companies and there's been demo days that we've been to where it's a lot of stuff that's deeper in the token path, which is a great place to be enabling agentic workflows, deeper in the stack.
1:17:17
There's a lot of hard tech this time, but I'm wondering how you're viewing the opportunity in consumer, in gaming.
1:17:27
We're just seeing so many vibe coded games that are remarkable demos and it feels like with a YC team on an actual deadline to get to real functionality, real adoption, revenue traction.
1:17:42
The tools are there now where previously to make something that looked anything like a breakout game, you'd see these companies and you'd and you'd hear oh, well, you know, Epic Games was grinding in the dark for 5 years building their engine before they released a game or, you know, so many companies, Roblox, it took a long time.
1:18:02
Now it feels like you can move faster and that might make it more the end state might be that all of this turns into, you know, there's no fundraising at all and it's all just indie devs, but it does feel like there's an opportunity here, but how are you seeing consumer either in gaming or just broadly develop over the next couple of years at YC?
1:18:24
>> I think it's still very early.
1:18:24
We haven't seen these companies break out yet. >> Yeah.
1:18:29
>> I mean, this whole era of AI right now, which is one of the most fun eras in tech right now, there's still so many patterns that we're figuring out.
1:18:37
And with regard to consumers, I think there's going to be a lot of big category winners that we don't know what the shape of them could be.
1:18:45
It's sort of like trying to predict the Airbnb or DoorDash back in the 2010s would be very hard.
1:18:55
And with regards to gaming, having worked in gaming myself and know a lot of these AAA studios that you mentioned that take a long time to get a game out there because the engine and there's just so much technical complexity.
1:19:10
A lot of that, yes, the barrier of that is entry is lower, but I think the thing that's still in short supply is um the ability to encode fun.
1:19:19
The thing [clears throat] why you could build lots of games today, which I've tried and and and I've coded some games, but it's hard to build actually game loops that people keep coming back and have fun.
1:19:35
There's some new patterns that we haven't discovered.
1:19:36
I mean, you could imagine now in the era where a lot of games could be on a agentic loop and based on a lot of the metrics of the usage, they could self-improve.
1:19:46
And it could be more fun, but I don't think people figure out how to build those because you you have to be able to measure fun, which I'm not sure if there's a easy way to do that.
1:19:56
It really depends game per game. >> Yeah.
1:19:59
Yeah, that makes total sense.
1:20:01
Uh anyway, thank you so much for taking the time to come chat with us.
1:20:03
Have a great >> to meet you and great work this batch.
1:20:07
There's a lot of fun companies.
1:20:08
>> Yeah, we'll talk to you soon. >> All right, guys. >> Have a good one. >> you. >> Goodbye.
1:20:13
>> Um Woman Nidus is getting himself in trouble for >> Again?
1:20:18
>> debating the world's population.
1:20:18
He says population is max 500 million global, Earth is max 15,000 years old.
1:20:26
People are asking if it's bait.
1:20:28
He's going back and forth with a bunch of people.
1:20:31
Uh he did he's he's pointing out that there are some I economic incentives to certain countries to misreport uh, population numbers if they're getting um, if they're getting economic incentives or distributions based on that.
1:20:45
He's having a field day on the timeline.
1:20:46
You can go dig into his posts and make it make a call for yourself.
1:20:51
Uh, anyway, over in China one of the most populous company countries in the world allegedly >> [laughter] >> uh, the final boss of ADHD has been spotted.
1:21:01
The guy is simultaneously watching TikTok, chatting in a messenger, and playing a game.
1:21:04
This is what a foldable smartphone is for.
1:21:10
There's pushback against smartphones now.
1:21:11
Imagine what foldable smartphones will do.
1:21:14
Is it Is it going to be even worse? Who knows?
1:21:16
Uh, this is an absolutely crazy setup to be rocking.
1:21:23
And is he pa- Is this a single-player game that he pauses or >> Yeah, it kind of seems like he's larping.
1:21:29
>> Yeah, this seems performative, right? >> a larp. >> This is a larp.
1:21:32
Yeah, I don't think this is real.
1:21:34
I got in trouble for my game uh, knowledge.
1:21:38
I I apparently used min-maxing improperly, although there was some debate over whether or not min-maxing has has transformed into the definition that I used, whether I was using a more modern interpretation of that term.
1:21:50
But, anyway, you can go and dig into Satrini's post and make your own justification on where you sit on token maxing, token minning, token min-maxing.
1:21:59
Uh, the clear point is that you got to focus on ROI like any other business process.
1:22:06
>> Andrew Gao sharing some data in terms of our cognition.
1:22:09
He says, "This isn't public, but Stanford CS degrees dropped 42% year-over-year. Berkeley down 61%."
1:22:17
"All of the propaganda like you don't need you don't need to learn to code anymore." "Seems to be working."
1:22:24
>> I mean, it's got to dramatically change the experience and like the fun of being like part of the fun of taking a computer science course is doing an exercise and working through the code and like solving the puzzle that is the code challenge.
1:22:37
And when you can just one shot that with any frontier model, it gets a lot less fun.
1:22:42
it gets a lot less fun. And so you have to imagine that people moved over to other more amorphous, more rewarding disciplines, but it does seem silly because I'm sure that if you if you go really deep in a CS degree and you're AI enabled as well, you can
1:23:02
both find a job and also have a really really interesting and and rewarding experience, but certainly a reaction to the fact that the existing path of just like someone tells me exactly what to implement and then I go and implement that and I make six figures forever is is less and less clear. And so people
1:23:20
And so people are reacting to that by going to other places.
1:23:25
I want to see the data on where where these students went.
1:23:26
What are they What are they studying?
1:23:29
If not CS, do they do they bleed into everything else?
1:23:33
Because sometimes you read these and it's like oh, they're not studying computer science anymore, they're studying computer engineering now.
1:23:37
And it's like yeah, that's kind of the same thing.
1:23:40
Like you saw that like computer programming declined, but computer science jobs increased or something like that.
1:23:48
>> Yeah, they're studying computer engineering.
1:23:48
They're studying AI and ML.
1:23:52
>> Yeah, I mean a lot of the the AI track has always been symbolic systems anyway, not CS at least at Stanford.
1:23:56
That's what a lot of the the early Facebook employees and a lot of those folks studied.
1:24:03
There's a lot of other folks that study physics or math or all sorts of things.
1:24:06
And it's got to be more fun to study a really hard topic like physics or math because you have an AI tutor and you can use AI to to close that gap, to bridge that gap.
1:24:18
But we we should ask Haris Tegaar from YC.
1:24:21
He's ready to chat with us.
1:24:23
We can ask him about what you should major in if you want to build the next great company. What do you think, Harj?
1:24:29
Did you study computer science?
1:24:31
Did you >> I I didn't actually as an undergrad.
1:24:32
I I started in law school and then I dropped out and then I taught myself to program.
1:24:38
>> A lawyer becoming successful, anything is possible.
1:24:41
>> Yeah, [laughter] that's true.
1:24:43
I had a bad start but I ended up okay. >> Yeah, no.
1:24:46
No, obviously it's a fantastic background.
1:24:48
It speaks to the the the diversity of of backgrounds that lead people to success in Silicon Valley.
1:24:56
What what do you make of this decline in CS degrees?
1:24:58
What are you seeing in the YC founders that join the latest batches?
1:25:03
Is there is there are you experiencing more diversity of backgrounds?
1:25:07
It feels like YC's always been pulling from all over the place.
1:25:11
The best case in point is Airbnb.
1:25:11
It's a bunch of design students and and that was not a feeder school for It was not a unicorn factory, RISD, and yet we got Airbnb out of it.
1:25:20
So, what's going on at YC in terms of educational background these days?
1:25:25
>> It's good You know, I was actually this weekend I was with a group of college students that we were meeting and you know, hopefully they'll do YC one day.
1:25:32
And this was definitely something they said is that they are seeing their smart friends enroll in in computer science less.
1:25:39
People want to do more physics and math and first principle stuff.
1:25:43
So, that definitely I think that's a leading indicator.
1:25:46
So, I would definitely expect over the next few years we might see more of the smart founders come in with like a a math or some sort of like thinking STEM background that's not pure CS.
1:25:56
And then like I don't use a coding model to actually write the code. >> Yeah, yeah.
1:26:00
It doesn't There's one read on this where it's like, "Oh, no one's going into tech."
1:26:05
And I think it's like, "No, people are going to be like even sharper about using these tools and even more you know, ground truth in what matters in what's not changing in the math and physics stuff."
1:26:15
Anyway, other trends that you're seeing >> Yeah, yeah, I wanted to to get into like the psyche of this batch.
1:26:20
If you zoom out, so many companies are are having like this sort of like often, you know, if they're later stage company, midlife crisis.
1:26:29
If they're younger startup that's kind of in the path of the lab, they're wondering.
1:26:35
Uh it feels like even the last, you know, few weeks, like the narrative is kind of flipped and we're seeing like a lot of the application layer companies say like, "Hey, we have an oppor- opportunity to to sort of orchestrate a variety of models and maybe get efficiency for companies that were were token maxing.
1:26:50
So, what is the psyche of the current batch?
1:26:52
Where are they finding opportunity?
1:26:54
I'm sure, you know, you had a few office hours where founders were saying like, "Is it over?
1:27:01
Should I just, you know, pack it up and >> [laughter] >> join a lab?"
1:27:03
Um but and and of course the YC way would be to say like, "No, there's always going to be opportunity for, you know, smart, focused people."
1:27:12
But um take us through it.
1:27:14
>> Yeah, I mean, it definitely ebbs and flows.
1:27:15
I would say when Claude Code first launched earlier this year, I feel like it really did flow towards the oh wow, like the labs are going to take way more of the value and like are they just going to own everything?
1:27:26
And I think that was a little bit in the um in the psyche.
1:27:30
I feel like now it's flowed back towards um uh you know, you don't you want to try and have a little bit of thought around are you going to be in the path of labs or not?
1:27:39
But mostly I just think the founders here are doing their thing.
1:27:40
Um and they're not they they're not currently like worried about that as much so much um so much so much more.
1:27:47
And I think like largely they're trying to figure out what are kind of maybe the boring but valuable things that the um the labs just not going to focus in on.
1:27:56
And I think there you see a lot of it's it's funny, it's like we used to talk talk about like making stuff that people want.
1:28:01
Now I feel like it's a lot of making things that agents want.
1:28:04
especially like the infrastructure level, it's like how do you set up sandboxes for agents that go into the nitty-gritty detail of giving them all the tooling that they need to use to actually perform tasks and actually to do things and it's the kind of stuff that the labs themselves are just unlikely to go into into depth on.
1:28:21
>> Yeah, it's funny that's somewhat of it's like somewhat a new framing think about what the big companies aren't aren't going to do is too off the beaten path for them.
1:28:30
But if you go back I'm like well the hotel industry wasn't thinking about Airbnb and the the the big banks weren't thinking about Bitcoin and you get coinbase and so there's something there that's like always been true and it's just sort of resurfacing and it's actually maybe a ground truth that you need to pull back to constantly.
1:28:48
But it but but it is it is potentially more relevant than ever.
1:28:51
more relevant than ever. Has the has the Gavin Baker meme of being in the token path taken hold this batch this idea that you want to be deeper in the bottleneck that if you're if you're not in the in the downstream path of the
1:29:07
labs you the safest place might be upstream deeper in the supply chain we talked to a founder who's working on cooling for data centers that's clearly something that's very aligned with the broad trend but what's happening there in terms of token path thought? >> I don't I don't know at least I don't
1:29:22
>> I don't I don't know at least I don't think that has trickled down to like the founders starting these companies and figuring out what ideas to work on.
1:29:27
figuring out what ideas to work on. I do think some of that framework fits like you're suddenly seeing things um further into like the physical world like actually you know building um building physical things but I think that's actually more to do with being
1:29:41
inspired by Elon and and Palmer Lucky at Anduril on the founder side that they people want to work on like physical like work in atoms so we've got a team in this batch building like a nuclear reactor like that that I think is just inspired by hey like we want to build real things. And then I think on
1:29:55
And then I think on the other side of the marketplace investors typically really didn't want to invest in hardware companies so we used to see this I always used to brace the hardware or the hard tech companies say you're going to have to like be ready for it cuz no one's going to want to invest in you.
1:30:08
You're going to have to grind it out.
1:30:09
It might be years before you raise the money that you need.
1:30:12
And now, I think I again, since Cloud Code, there's been this real shift of oh, like SaaS is dead.
1:30:16
Maybe software is not going to be as valuable.
1:30:19
Suddenly, investors all want to invest in hard tech stuff, which is, you know, I'm happy about it, but it does also just show like how fickle that that that side of the market place can be as well.
1:30:29
>> Have you seen any change to average burn rates with or any anyone in the batch token maxing so hard that you have to say like, hey, you should probably, you know, I I expect you to raise, you know, after demo day, but you know, maybe maybe don't spend >> No, not yet.
1:30:46
You know, I'm a bit reluctant to say this, so I don't want it to change, but I don't think I have that much control.
1:30:50
Like, I actually think on the ground, the founders feel like the subscription plans from the big lab companies are actually very generous.
1:30:59
And so, they're able to actually get as much token usage as they want.
1:31:05
Largely, out of those plans has sort of been what what I've seen.
1:31:09
We do internally talk about this.
1:31:09
Like, we do wonder if there's some training we need to do to like push the founders to spend more on tokens.
1:31:15
And that maybe they're thinking about tokens as something you should conserve spend on, whereas like I think I and at least a bunch of the other YC partners really think about it.
1:31:25
It's a lot more like rent.
1:31:27
Like, you don't say I'm not moving to San Francisco to build my tech startup because the rent's expensive.
1:31:32
Like, yes, it's expensive, but it's the place to be.
1:31:34
Like, you don't conserve on that.
1:31:36
You like want to be You actually want to spend money on that.
1:31:38
There's other things you save money on.
1:31:39
And so, it I do feel like because so many of the founders, especially if they're younger, they just don't have the budgets to use the latest models and be like cost insensitive and token max.
1:31:49
So, they just they're just used to conserving and trying to do more with less.
1:31:57
And I think that that may well change.
1:31:58
But at least currently, I I am I don't feel like the burn rate is going up because people trying to get to product market fit are spending way more on tokens.
1:32:07
>> Yeah, it's interesting.
1:32:07
It's like, you know, maybe you don't you can delay hiring the incremental engineer, which actually can be very good because it's way easier to pivot if you have just the founders, right?
1:32:17
Versus like, you know, once you start adding.
1:32:19
What about trends on the business model side?
1:32:21
You know, last year I feel like the you know, classic VC blog post would be like sell the work, not you know, the product.
1:32:32
Uh we've seen it some companies get to the point let's there's like, you know, a legal startup that that's like actually just doing the doing the contracts.
1:32:41
They basically they sell uh executed contracts effectively, but it hasn't maybe been as popular as I think a lot of people had imagined, at least so far. But what do you think?
1:32:53
>> Um I don't think the business model has a fully switched over to um like the paperwork yet.
1:32:58
It's starting to paper usage, um but I don't think it's paperwork yet.
1:33:02
And I think that's just because um the agents as yet haven't quite been good enough to actually consistently deliver like the final contract in a way that makes the startups feel um uh good about charging that way.
1:33:16
I do think we're right on the cusp of that changing though.
1:33:19
Like this batch really does feel like one where it's it's not just sort of agents to review things or human in the loop or um getting stuff teed up.
1:33:28
It's really starting to be more end-to-end and you're getting to the point where the agents are just doing all of the work.
1:33:35
And at that point, yeah, you may well switch over, but I I feel like maybe that's going to be a batch or two away.
1:33:41
>> Is there are we going to see a revenge of the of the network effect?
1:33:43
It feels like in a world where, you know, software is mutable and and maybe like the million lines of code that you and your team built are not as defensible as you thought.
1:33:56
The original SaaS apocalypse thesis, um, network effects businesses should do really well.
1:34:01
I don't know if more founders are talking about that.
1:34:03
But what what's your interpretation?
1:34:05
Because it is sort of the hardest moat to construct, happens sort of randomly sometimes, but uh if you can get it done, it feels like you'll be very you'll be in a very strong position.
1:34:17
>> I'm you know, you mentioned like the late stage companies having like maybe mid-life crises.
1:34:20
That's where I I I hear network effects talked about more, honestly.
1:34:24
It's like some of those companies if you're um Whatnot or Carousell at the moment, like or Coinbase, like you're feeling pretty good about the fact that you are a marketplace business with real knock-on network effects and you're not worried about sort of someone vibe coding um a competitor to you.
1:34:40
So I think that's where I hear it.
1:34:42
I will say like yeah again on the ground floor here on the batches, I don't um we haven't seen as many founders like build pure marketplace businesses um as you would you would expect based on that thesis.
1:34:54
Now I think it's just because obviously people are really excited to work with AI and build AI tools.
1:34:57
They're not really thinking about it as hey like what's like a what's got like a network effect moat and how can I build that business? >> Yeah. What about gaming?
1:35:06
We talked today in a little bit about this, but it feels like we you were seeing incredible demos of vibe coded games.
1:35:14
When I see them I'm like I would love for a team of YC founders to work on that for 3 months to get it actually to a place where it's a real game instead of just a demo.
1:35:23
Uh and but the underwriting for the game industry has always been different than the traditional SaaS venture capital flow.
1:35:33
Is there a world where YC is more open to just pure games companies?
1:35:37
We're just going to make a hit game, we're going to scale it into a triple A game studio, we're going to develop IP.
1:35:43
That's a very different motion, but are you open to that?
1:35:48
Is there is there momentum there or is that something that you think is farther off?
1:35:53
>> Yeah, I mean we would totally be open to it.
1:35:55
Um Diana's definitely got the gaming background and gaming expertise there.
1:36:00
But yeah, I think we would be totally open to it and just like the reason you typically as a startup investor don't want to invest in games is that it's so hits-driven.
1:36:07
Even if you get one hit, how do you know you get another one? What's replicable?
1:36:09
Um But yeah, like you know these days like if you can if you can build some recipe for actually consistently producing games and and I feel like Zynga the closest to that.
1:36:21
Though arguably that was more about like they sort of productized the distribution mechanism and the viral mechanics more than like the the gameplay.
1:36:27
But I know that seems plausible in AI.
1:36:30
It seems like you can if you can actually build an AI or an agent that can consistently produce high-quality games.
1:36:36
And also you just be able to run so many of those experiments in parallel or so many more experiments in parallel than you could before.
1:36:41
Um I think that'd be really interesting.
1:36:44
Again with us it's the same thing.
1:36:44
We need to see founders who seem like they've got some insight at that level.
1:36:49
Like they're thinking about it beyond just hey, I really love playing um third-person shooters and I want to build like a really cool third-person shooter game.
1:36:55
We'd probably have to hear that in the interview.
1:36:56
Like hey, like I'm thinking of how this would like generalize and build out and here's like where the the technology could be interesting.
1:37:03
>> I'm wondering if uh I mean I'm wondering if there's a lesson from I mean Hollywood is probably behind YC in terms of the forward-lookingness, but there's this interesting case study with Backrooms, an obsession, these YouTubers who went and made like classic Hollywood films, low budgets, but real budgets,
1:37:22
and they put up huge numbers and they're and they're and they're massive successes in in Hollywood now driving a lot of attention and uh and it's interesting to think about like what is the next category that gets unlocked that's more of like indie dev world, but now has the ability to scale through like the YC venture capital model. >> Yeah, I I um
1:37:44
>> Yeah, I I um Yeah, I think that's going to be really interesting.
1:37:47
I think that's where you might end up seeing I don't know if we'll see like the one-person where you might see the one-person unicorns, but you certainly feels like you're going to start seeing the one-person like hundred million dollar revenue companies in like a bunch of verticals because you've just got like agents doing the core business functions. >> Yeah.
1:38:02
Okay, so have you ever had an office hours where where a founder comes in and they're like, all right, like I think I'm I think I'm that company.
1:38:08
I think I'm the one-person hundred million dollar company.
1:38:12
Cuz like everyone's been talking about this forever, but like there's such a much stronger incentive to just like hire the incremental person if it can make you like I just don't know that it will ever I just like may- maybe it it it happens. >> want a buddy.
1:38:29
>> But yeah, there's such a strong incentive like do I want >> I could do the work >> but I got to have a friend around.
1:38:35
>> Yeah, like do you do you want to do you want to be the like company that gets an award that doesn't matter do you want to win? >> Yeah, good point. >> even a real award.
1:38:42
It's just like it's a it's something that you can say on the internet and then people will debate it and be like, well, you hired this freelancer like, you know, you have a lawyer does that really count?
1:38:49
So like I feel like it will never actually happen because it will already always be debated and >> Sure, sure.
1:38:57
>> Um I personally have not worked with a founder who's like come in with the dead set like I never want to hire anyone I kind of want to only work for myself.
1:39:03
I mean, my guess is someone like that is not going to gravitate towards like a a community product which is essentially what YC is.
1:39:10
And so um uh it could happen. Who knows?
1:39:12
I I the thing that I'm seeing if a hundred percent you can get to your like series A you can get to a million or two million dollars of revenue without hiring anyone and being way leaner than you've ever seen before, but after you've raised the A or the B, it does seem like hiring is essentially the same as it's always been.
1:39:30
Like who knows whether that's because like there's just more work to do or whether just like it's like you know, once then you have like your investors and they're like running the same playbook, but I definitely am not seeing any evidence yet of like those companies really slowing down on on hiring. >> Mhm.
1:39:47
Can you give us the lore on the Paul Buchheit $100 billion question?
1:39:54
[laughter] >> That's a funny that's um um Yeah, for sure.
1:39:58
I mean, what's the lore like um You know, we do this thing at YC called group office hours where it's just sort of a couple of the partners and a group of the startups and you kind of it's sort of like I don't know it's it's it's sort of like a group discussion.
1:40:07
Hey, like what's going on? What are your problems?
1:40:10
And sometimes we'll prompt with hey, like let's think about this.
1:40:13
So again, everyone could of like um chime in.
1:40:15
And Paul always had this great prompt which was um don't just think about how you're going to be like a billion-dollar company where you get to like $100 million in revenue.
1:40:22
Think about like what's the next act from that.
1:40:26
Like how do you get to $100 billion?
1:40:28
You know, like Google started off with search and then became so much more. Meta's the same.
1:40:31
And so it's sort of like a expe- it's sort of like a mind-expanding exercise and it's useful to do at this stage because um you get a sense of how much ambition and vision do the founders actually have.
1:40:41
And sometimes it helps them get more excited about their own company when they realize, oh wow, like this is like you know, I was thinking about it as like how do we like build this one product that gets us to like, you know, $100 million revenue, but actually I didn't even realize there's six other things we could do.
1:40:56
I just have to like get there. >> Yeah. Is it too small? Do you need a 10x it?
1:41:01
We got trillion-dollar [laughter] companies now. >> That's true. It's inflation.
1:41:05
>> Elon is even Small Time YC just wants to sit around just knocking base hits to $100 billion.
1:41:11
Are you swinging for the fences or not, Harj?
1:41:14
>> Maybe maybe I'll bring it back and call it the trillion-dollar >> It has a nice ring to it, honestly. >> it as my thing. >> You should. You should.
1:41:22
>> [laughter] >> Sorry, PB.
1:41:22
Uh Jordy, what was the last >> No, I was just saying Elon was uh saying on Sunday he's he would be surprised if they don't have a trillion of revenue by 2031. >> I agree. I agree.
1:41:32
What's the path to >> The market the market space times. You can't beat that. >> Yeah. >> That's right.
1:41:37
>> Anyway, we're going to hop on with Gary.
1:41:39
Thank you so much for hopping on the show.
1:41:40
Yeah, thanks so much for hopping on Demo Day. We'll talk to you soon. >> Cheers. >> Will do. See you guys in a bit.
1:41:45
Let me tell you about public. com.
1:41:48
Investing for those who take it seriously.
1:41:49
They got stocks, options, bonds, crypto, treasuries, and more with great customer service.
1:41:54
Absolutely, we got to hit Gary with the flash bang as he comes in. Gary, how are you doing? Welcome to the show. He's now here. It's Demo Day. Watch out. It's flash bang. Great to see you. Great to see you. How are you doing?
1:42:16
[laughter] Take us through everything. How's the day been? >> long. >> Oh, it's awesome.
1:42:19
I mean, it's always the big show here in San Francisco.
1:42:21
I mean, it's a beautiful, gorgeous day and you know, who doesn't like to go check out a nuclear reactor in our back parking lot. No uranium, don't worry. >> Woah.
1:42:32
>> This is like the second or third nuclear company, though, right?
1:42:35
>> I mean, I think we need we kind of need all of them, right?
1:42:37
Let's do >> We need all of them. All of them.
1:42:39
>> What's stopping them from going critical in the in the in the parking lot?
1:42:43
>> Oh, well, luckily, no uranium.
1:42:43
So, you have no Geiger counter needed. You're all good. >> That's great.
1:42:49
Is how much is hard tech booming?
1:42:50
Do you have any like stats?
1:42:52
It feels like every year there's a slight slightly more people taking the the hardware isn't that hard.
1:42:59
They say hardware's hard, but I'm going to try it and it feels like that's been a trend that's been growing steadily.
1:43:07
Am I am I correct to read that into the trends over Demo Days over the last couple years? >> Yeah, man.
1:43:12
I got to call out my buddy Brett Gibson over at Initialized Capital.
1:43:16
I mean, right when Code Gen first started happening, Brett was my first friend who said, "You know, obviously, you got to you know, fund the bangers and it's not like they stopped doing B2B SaaS."
1:43:28
But, you You Initialized was one of the first people to do the pivot to say, "You know what?
1:43:33
Like hard tech is the way it's going to go."
1:43:34
And uh you know, things like Flock Safety were sort of the first things we did that really, really became huge.
1:43:41
And um you know, computer vision is in.
1:43:43
And then now with AI, like everything is open. It's so much easier.
1:43:47
Um I mean, you can do mechanical engineering.
1:43:51
You could do electrical engineering.
1:43:52
If you don't understand it, you can build it.
1:43:56
You can find every vendor.
1:43:56
Like the supply chain management can happen right there, all in open claw now.
1:44:00
I mean, there's I mean, we're just in a new age.
1:44:04
>> Yeah, I mean, we've even seen people like like uh optimizing their home Wi-Fi speed and like, you know, different >> Yeah, yeah, the open claw. It's crazy.
1:44:13
>> Um a lot of the hard tech boom, I feel like has been driven by uh Elon, Palmer Lucky, just sort of breaking the glass on like, it's possible for this to happen.
1:44:23
And that's led to a lot of like defense tech startups.
1:44:28
But I'm interested in the intersection.
1:44:30
What are you seeing and how much uh how much conversation is there around um hardware and AI, data centers, stuff that's in the token path, but not in the direct path, not one-shotable by a by a frontier model? >> Oh my god.
1:44:46
I mean, honestly, uh Shh, but you should probably get Ashton Ashton Kutcher's here today.
1:44:51
You should go talk to him.
1:44:52
He's got a whole thesis around AI, solar, you know, he's actually pretty bearish on fusion, which is interesting.
1:44:59
You should ask him about that. >> Okay. >> Um >> Yeah.
1:45:02
>> I think that >> That's in that's news. That's going to hit. >> Yeah.
1:45:05
>> [laughter] >> Ashton Kutcher bearish on fusion.
1:45:05
And we love we love Ashton.
1:45:09
>> He is like really he went all the way like he met everyone.
1:45:11
So, I mean, Ashton has been an incredible investor, especially for hard tech.
1:45:16
Um but anyway, I mean, I think what we've been seeing, there's like more uh there's more defense here in this batch than uh the entire last year. >> Yeah.
1:45:28
>> Uh and then >> also more geopolitical conflicts.
1:45:29
So, there's more energy to purchase and the government's sort of changed a lot of the ways stuff is procured.
1:45:35
And so, uh the old adage you need to be a billionaire to start a defense tech company is now gone.
1:45:43
>> the Palantir's, the software singularity, and then hardware still >> to them, too. >> Who?
1:45:49
>> So, it's uh Emil Michael and >> it's our friends who are actually in the Trump administration who are like changing everything.
1:45:56
Like the DIU, like it's a new Department of War.
1:45:58
Like this is never You know, I think that there is actually an awareness that cost plus uh you know, cost plus was originally designed to be something that created more innovation.
1:46:08
And you know, here we are 50, 80 years later.
1:46:11
And you know, what was needed for 50 or 80 years ago uh it's the wrong thing now.
1:46:17
You know, you have the defense primes that are just not actually uh innovating. They're they they can't.
1:46:24
Like it's sort of structural.
1:46:24
There's sort of these you know, it's the equivalent of big tech bureaucracy.
1:46:27
Like I think uh you know, I think of iPhone, how stupid Siri is and how terrible it is.
1:46:33
Or even like Alexa over at Amazon.
1:46:36
It's like unbelievable how incompetent You know, I mean, these are very competent people put into a system that is uh structurally unable to deliver technology that is actually what people really really want.
1:46:46
And so, when you talk about consumer technology, like you know, it's not that big a deal.
1:46:50
Like you know, my life is 20% worse, 10% worse because uh I can't use a Siri that actually uses large language models properly.
1:46:59
You know, years after it was designed.
1:47:01
And I usually, you know, when I go to DC, I like to tell politicians that.
1:47:06
It's like, "Hey, like here's this thing that doesn't make sense in society."
1:47:09
But you know, it's consumer tech.
1:47:11
It's It's no one's going to really like Probably very few people have died because of it.
1:47:15
But when I really what makes me mad though is when you think about like there are service members who are going to die in in service of our country to defend liberty and they're giving their lives because defense primes are not doing the job that they're supposed to be doing, right?
1:47:33
They're not innovating, they're not bringing these new technologies to fore and it's structural.
1:47:36
And it's not like individual people trying to do it, it's structural, right?
1:47:39
Like just as the people who work on Siri, like actually we funded a number of them who have come and done YC.
1:47:45
Delightful, wonderful people.
1:47:48
Like the people who work at these companies are incredible.
1:47:49
I never want to attack the engineers working on this stuff. It's actually structure.
1:47:55
Like you have big tech and you have you know, big anything, right?
1:47:58
It becomes structural where here's a thing that should happen, it does not happen, why?
1:48:05
You know, I think cost plus is one of those things.
1:48:06
Like it's just systematically instead of trying to create something that's better, it's like how do we maximize shareholder value and you know, I get it, but also why are we doing it this way?
1:48:17
And so, you know, credit to the Department of War.
1:48:20
Like they are actually for the first time in like decades, easily.
1:48:23
Like they're actually open to a team of 10 or 20 people, whether it's, you know, in Boston, in Austin, even down the street in San Francisco, in in Gundo.
1:48:33
Shout out to our Gundo bros out there.
1:48:35
Um >> Yeah, we talked to Dan Dursky about this about just like having range days where any startup can come and pitch and they'll just buy the best product right there.
1:48:47
It feels like it's an entirely new day in terms of procurement.
1:48:48
Um switching gears to software, is like I could prompt that with one with one prompt I could build that or it's just directly in the path of the labs, it's so easy to build.
1:49:00
Is that the new like what if Google builds it?
1:49:03
Like I I I have a suspicion that we might have over rotated on the on the um oh, like it's easy to build that particular product or vibe code that particular product and it's like, yeah, but you didn't, and then this team did, and they went and did all the other hard things to get customers and understand the user, and actually build a great product.
1:49:27
And so, yes, you could clone it, but they have momentum, and so maybe they won't be a trillion-dollar business, but there might be some beautiful businesses that are accelerated, [clears throat] and they look like SAS, and they look like they could be cloned, but there's something secret there that's still going on.
1:49:42
How do you think about that?
1:49:44
Do you push back, or do you agree?
1:49:46
>> No, I think that um you know what?
1:49:48
Like, being in San Francisco and being friends with people at the labs and being able to see like the inside, like, you know, being able to see uh the inside of like >> Yeah.
1:49:59
>> you know, what Codex and Claude code is going to be um incredible, right?
1:50:00
And then >> [clears throat] >> these are all 200 IQ people building 200 IQ models, and you know, it's [clears throat] going to keep going.
1:50:09
I mean, it's it's going to be uh you know, true AGI, the takeoff is happening. >> Sure.
1:50:15
>> And uh the thing you have to realize is like everywhere else, like well, those 200 IQ people can't really interface the way that they need to to with the 150 IQ people and the 130 IQ people and the 100 IQ people and like the mass humanity.
1:50:30
>> No, you talk to a lot of entrepreneurs, and it's like, yeah, this person just worked really hard and found an interesting niche and just delivered.
1:50:39
>> to my level, room temp, please.
1:50:41
>> [laughter] >> But like, you know, we're not joking, but I on the you know, on the other hand, like, the world actually cannot interface with these things, like the models will be too complex, the UI will be too complex, like you know, the the more complicated you make any given solution, the less likely someone's actually going to be able to take advantage of it and implement it and use it. >> Yeah.
1:51:05
>> Um and so, you know, that's where all of the value is in business.
1:51:08
It's like, how do you take this new tech that nobody has and very few people understand >> Yeah.
1:51:15
>> and then bring it to them in a way that actually helps their lives.
1:51:17
And you know, I mean obviously in on a 5 or 10 year basis with AI, you know, super intelligence becoming what it is, you know, all bets could be off >> Yeah.
1:51:29
>> on like a long enough time frame, but certainly for the next like 18, 24, 36 months, uh that's not happening and for now, um hey man, I we're going to fight for the little guy or for, you know, the person who has nothing sitting in front of a recycled MacBook Pro to be able to make anything, to make prosperity happen.
1:51:48
Like that's what that's what this logo is, >> I love it. Yeah.
1:51:52
>> that's what that's what we're about.
1:51:53
Like this is as long as this is a flag that flies, like I I will to my dying day will fight >> I love it.
1:52:00
>> for the startups and for startup founders and for people to be able to create something from nothing. >> Yeah.
1:52:05
>> And you know, I think it's going to be a while before we really have to worry about like are there going to be jobs and things like that.
1:52:13
>> No, I completely agree.
1:52:14
>> What out of the current like requests for startups is there any category that comes to mind?
1:52:21
Are you working on a new on a new request for startups list? >> Yeah, absolutely.
1:52:27
I mean we're always doing that. I don't know.
1:52:28
I'm trying to convince Ashton to do the uh you know, the call for solar and reindustrialize America with me, so maybe you'll see that.
1:52:36
Joe Gebbia, chief design officer of the United States, he he you know, sent me the one about agriculture.
1:52:43
You know, we're uh I I think that we're realizing that like YC has a real convening power and people really shouldn't have to just go and work on an you know, nothing wrong with B2B SaaS and we love it, >> Yeah.
1:52:57
>> but also like, you know, if you've got something in you that isn't that, like we can actually try to harness like all that brain power >> Totally.
1:53:05
>> and all that AI power into basically everything.
1:53:07
I mean, that's my the number one philosophy that I think people have not absorbed yet enough and that I want everyone to hear and I will shout uh from every hill is that it's time to boil the oceans, guys.
1:53:18
Like everyone else is out there trying to figure out like, oh, let me like lay off all these people and haha like the machines are better than humans.
1:53:26
It's like, you know, we live in a broken completely just it's like a backward world. Right?
1:53:34
Like if we could accelerate technology fast enough, it would solve a lot more problems.
1:53:38
People would have a lot more prosperity.
1:53:40
And now like the biggest one of the biggest things the blocker is not even money.
1:53:44
It hasn't been money for some time.
1:53:46
It's definitely not right now.
1:53:47
Like it's just pure agency.
1:53:49
Like do you have an idea? Like can you prompt it?
1:53:52
Like can you actually do you actually know how to use this stuff? And what do you want?
1:53:55
Like what do you want to manifest in the world?
1:53:58
And if we do that and we do that like 10 or 100 times or 1,000 times more than we have been and we have you know, and then going back to what we were saying earlier, like it's actually about the systems, right?
1:54:08
A startup is the defining system where either you do it or you don't.
1:54:13
Like either you have a customer that loves it or a customer that like doesn't buy it.
1:54:17
And like most of the time frankly like people love to bag on startups is because those startups don't make something people want, right?
1:54:24
That's why our t-shirt is literally make something people want.
1:54:26
It's not more complicated than that.
1:54:26
We actually give away the secrets on our freaking t-shirts.
1:54:29
It's a great t-shirt that you get on your first day at YC.
1:54:33
But like it's surprising how hard it is to do that.
1:54:36
And then but if we did that, you know, instead of trying to replace jobs, instead of trying to say like you know, haha I could like lower my cost by 90%.
1:54:46
Like the thing is that's why I love markets.
1:54:49
Like if you have you know, just to take it take like a big tech swing again.
1:54:54
When you have a moat that is so unassailable that is basically like regulatory capture.
1:54:58
Like you basically if the government says like actually Apple, you can just not have multiple app stores, then you know what uh the government just granted?
1:55:08
The government is okay with the monopoly.
1:55:12
And when you have a monopoly, you have no choice, and then that's what we have.
1:55:16
Like uh we do not have choice about uh what messenger we use.
1:55:19
Like, why is iMessage so stupid?
1:55:21
If you had LLM's embedded in that, you would have so you know, we could actually literally save time by having uh that level inside our phone.
1:55:31
But I guarantee you >> Personally, I like when I'm searching for like a very specific message that I know I sent [laughter] and I can't find it.
1:55:37
Personally, I just >> Where Where is the bar for big tech now?
1:55:41
Where Where Where is the bar for big tech?
1:55:42
Because SpaceX is now a $3 trillion company.
1:55:45
If you're just hanging out at just $1 trillion, are you little tech now?
1:55:49
Are you a $100 billion little tech company?
1:55:52
Like, where Where Where is the line?
1:55:56
>> Honestly, it's like after people are like $10 billion valuation, I'm like, "God bless you." >> Okay.
1:56:02
>> Please don't Please don't, you know, mess it up for the next Yeah, please don't steamroll the next generation, you know.
1:56:07
>> Decacorn is the graduation. >> experience, right? >> Yeah, I know. That makes sense.
1:56:10
>> You become a decacorn, you start hiring these Google PM's who come in [laughter] and, you know, the same people who closed off the platforms on app stores and things like that.
1:56:17
You start hiring those PM's, and then it's over, guys, you know. >> Oh, wow. >> Which is fine.
1:56:22
Like, as long as The thing is like as long as there are markets, as long as there's choice, like, there's going to be a check on that, right? >> Yeah. Of course.
1:56:30
>> That's That's my fractal.
1:56:30
I'm like, "Hey man, let's boil the oceans."
1:56:34
Let's make so many more people I mean, it's You want to get political? I don't know.
1:56:38
I I have a thing about that. >> Not particularly.
1:56:41
>> Okay, no politics [laughter] today. No politics today.
1:56:44
>> I uh I would >> today.
1:56:47
>> I would rather talk about uh gaming. >> You're running. That's it.
1:56:50
You're running for president.
1:56:51
For president [laughter] of the United States. >> Sorry, guys. >> Oh, interesting.
1:56:55
I I I want to I I didn't know that for some reason.
1:57:00
>> I was born in Winnipeg. I'm naturalized though. >> Yeah, yeah, yeah.
1:57:03
>> Yeah, God bless America.
1:57:06
>> I I what I actually want to know about is G stack.
1:57:08
I want to know about G stack in the context of LIC.
1:57:10
I feel like YC the whole goal the whole system is built to allow the founders to talk to their customers to build something people want and that's why there's Bookface with investor reviews because you could see a founder getting distracted and being like, "I need to optimize my fund raise and so I should go build a database and interview everyone about what funds are the best."
1:57:32
They don't need to because it's been done for every YC company.
1:57:36
It's that's gone through the batch.
1:57:36
And is there a lens where I can view some of the research, some of the work, some of the experiments that you're doing around vibe coding, around G stack as let me sort of like un do the unhobbling but fall on the sword of like optimizing systems and experimenting so that that burden doesn't go on to every single YC founder that's token maxing >> Absolutely. Yeah, absolutely.
1:57:59
Okay, so G stack was sort of my project from like January through March.
1:58:03
I'm still maintaining it and fixing it.
1:58:04
But like my new thing is G brain which I actually want it to be like the post grass for agents.
1:58:11
So thing I realized is that like uh you know, when a agent you know, a human can only keep like uh seven plus or minus three things in their head, right?
1:58:20
Like a phone number is about it, right? >> That's generous.
1:58:23
>> But Yeah, that's generous.
1:58:24
>> under hundreds of things but yes, I understand for most people.
1:58:27
>> Some of us are special.
1:58:28
>> [laughter] >> John, you're very special.
1:58:28
uh And but a computer with an LLM, it can keep about three Harry Potter books in their head.
1:58:37
And so >> It doesn't sound that impressive when you say it that way.
1:58:40
>> [laughter] >> I mean, it's I mean, it's like a stack of books. >> no.
1:58:43
I I would say it's way better when you say like it it it can contain like 75 Erdos problems or like something very complex math.
1:58:49
But Harry Potter I'm like but yes, I understand.
1:58:51
The the context window is is significant and and especially compared to a human. Yeah.
1:58:57
>> And then when you think about like what most computer systems are, like actually you should think of like the Library of Alexandria, right?
1:59:03
Like thousands of books, tens of may- maybe millions of books.
1:59:07
Like actually it's even bigger than that, it's like the whole internet, right?
1:59:09
And then uh that's what like sort of like Karpathy's knowledge wikis are.
1:59:13
People are talking about company brains.
1:59:15
Like uh you could basically take all of the relevant info about customers and uh everything that you've ever any any person that like anyone of the companies ever even met.
1:59:27
Like that's what a CRM is.
1:59:27
You can have that in like 100,000 or a million markdown files that like comprises everything that that business is. >> Yeah.
1:59:35
So, that's basically what G Brain can do.
1:59:37
>> Yeah, I think people misunderstand that like YC has been building software to help batch participating companies for over a decade at this point, I think.
1:59:47
Probably longer, maybe 15 years.
1:59:50
>> Yeah, and we're we're building that in. >> Yeah, exactly.
1:59:52
Makes >> actually I think you know, now we have all these tools that are going to be built directly into uh YC Bookface. So, >> Yeah.
1:59:59
You're going to want to be a part of the community.
2:00:02
>> Yeah, but see it's been getting better.
2:00:03
Like the the pace of the pace of software development on Bookface and YC's internal tools is accelerating.
2:00:08
It's been uh refreshing to see uh that that it's people often have a window into it and they see like, "Oh, there's this demo."
2:00:16
But, there is an internal product that is evolving and getting better, which >> So, uh so the magic moment for G Brain is basically like being able to take any book that exists in your entire business and then making sure the three books that really matter for the thing you're trying to do are loaded.
2:00:30
And then that's basically ASI.
2:00:32
Like you don't have to write software anymore.
2:00:34
You can just straight up use Hermes agent or OpenClaw plus this.
2:00:39
Uh I am trying to make it work with a Codex and um you know, co-work, but honestly I think that those were like Hondas and honestly, I mean, open cloud is still the Ferrari man.
2:00:53
It's still the Ferrari, but you know.
2:00:55
>> Open cloud, that's good. Very, very fun.
2:00:59
What what are the trends that you're seeing in in applications?
2:01:00
Are applications increasing in the age of AI?
2:01:04
More people wanting to do startups or are people coming from big tech or from >> Applications as in like people >> Applications to YC, like people trying to start companies.
2:01:13
Like it feels like in all this anxiety of like big tech layoffs and stuff, like the flip side of that is that there's more entrepreneurial opportunity because we see >> Yeah, I find I find myself just pointing people to the YC website when they're when they're maybe they're not a software developer and they decide to build their first app in the last 6 months, which there's been many.
2:01:34
I'm just like go follow this even if you're not going to apply.
2:01:38
Like this is this is this is what works.
2:01:42
>> Yeah, did you see PG came out and said it he's like, if you're non-technical, just stop calling yourself that.
2:01:49
Cuz you shouldn't I mean, why why limit yourself actually? Yeah, I don't know.
2:01:52
I think we're seeing >> Non-technical was always like because obviously like it's not a binary.
2:01:56
Like like I learned Python and a little bit of C++ and I could like sort of deploy a website, but like I'm like levels below like a true like you know, incredible computer scientist who's like creating Python.
2:02:14
But I would just sort of like be like, yeah, okay, I'm technical because that's good, but it's like there's obviously levels to these things and the more you can like >> If you sit in front of cloud code, I guarantee you you could fix some bugs in Python and submit a PR that would be accepted. >> Yeah, everyone can.
2:02:31
>> And that wasn't true a year ago.
2:02:33
>> Personally, I think John could solve continual learning. >> That would be great. You could do it.
2:02:38
You just it's just a matter of will. >> I I a podcast to run.
2:02:42
>> [laughter] >> I'm trying to be low agency, low taste right now. >> Low taste. >> Low taste.
2:02:49
>> [laughter] >> Anyway, thank you, Gary.
2:02:49
Congratulations on demo day.
2:02:53
>> Yeah, great great to see you. Good to catch >> up. We'll talk to you soon. >> Catch you guys.
2:02:57
>> Have a good rest of your day.
2:02:59
Did you see >> the all black. >> All black looks good. All black looks good.
2:03:02
Uh did you see the Rolex open a new boutique on the Swiss Alps in inside of a former telecommunications tower?
2:03:07
It looks like a Modern Warfare 2 map. Look at this building.
2:03:12
This is an incredible uh place to hold a boutique.
2:03:16
I guess you have to hike up here. But look inside.
2:03:20
This is a Rolex boutique. You go in there.
2:03:22
They show you some watches.
2:03:22
Um but this looks like Modern Warfare 2.
2:03:26
>> Carter says, "Imagine being told they have nothing in stock here."
2:03:28
You both [laughter] know very well they have watches in stock. >> Yes.
2:03:32
>> Uh what actual resort is it on?
2:03:35
>> I don't know if this is a resort.
2:03:35
I think this is a uh telecommunications tower.
2:03:38
But I got to know more about this.
2:03:40
We got to we got to get someone to a call in from this particular boutique because this is an absolutely wild uh wild wild scene.
2:03:50
But what a great like brand activation.
2:03:53
Uh it does have a Bond villain aura.
2:03:55
But I think it looks great. >> threads from here.
2:03:59
>> Imagine posting threads. You know what?
2:04:01
Every time Connor Hayes comes on the show, he's like, "You guys don't post on Threads."
2:04:04
I posted twice about this interview.
2:04:05
So Connor Hayes, get in here and [snorts] uh tell us what's new with with Threads. >> What's up, gentlemen? >> What's up? Good to see you again.
2:04:12
[music] >> I'm doing great, man.
2:04:13
Yeah, I do I appreciated the post today, John.
2:04:15
But it's good to see you again.
2:04:18
>> We have been getting better.
2:04:18
We've been posting a lot more on Threads. We're having fun.
2:04:21
And also, the the this is the weird thing is that like I think, and you'll tell me, but I think what's driving Threads' success and and the growth is the the differentiation.
2:04:31
Like I go there for car community.
2:04:31
I go there for all sorts of different subcommunities around TV shows and different things that aren't really there it's not work for me when I'm there when I'm on X or YouTube or even Instagram now.
2:04:44
My Instagram my personal Instagram is just my personal brand my work product but threads has it's more fractured but in a good way if that makes sense but you tell me what's what's driving all the growth?
2:04:56
>> First of all, can we just can we just hit the gong already >> Absolutely absolutely I was kind of waiting for you to say that.
2:05:06
>> That was a big swing too.
2:05:06
That >> That was a big swing. >> It's a warm-up swing.
2:05:09
The real swing is coming later in the show.
2:05:12
>> Yeah, so we we announced 500 million monthly's today. >> Huge.
2:05:17
>> I mean the John I'll get to your to your question in a second but the the other thing which I know we've talked in the past when I was on the show about growth coming from promoting the app in Facebook and Instagram. >> Yeah.
2:05:26
>> You know another thing that we were sharing today is the proportion of people that are coming to threads not from those promotions has been going up quite a bit in the last year and that's been a big focus for us.
2:05:35
Um and we're doing it while deepening engagement.
2:05:37
So we're up like 130% year over year on time spent in Japan, 80% year over year in Korea.
2:05:41
Um part of the playbook that we've been running is to pick these verticals and communities kind of one at a time and just blitz them from a go-to-market perspective and a product perspective all together.
2:05:51
I'm sorry if you guys get background noise I'm literally like at a team party for this right now. >> Amazing huge. >> Amazing.
2:06:00
>> Uh what so yeah so so yeah >> non-family of apps referral traffic is that links being shared on the open web is that screenshots is that referral like invite your friend or share a link in a DM?
2:06:16
>> Yeah, often actually the initial new user install comes from those and then what we try to do is get people to come back to the app without a promotion the second time and third time etc. Got it.
2:06:25
So that's been the thing that we we've been most successful at and that's just through like making the content better getting you better connections in the app, launching messaging which sends you notifications when you get DMs, and just having good content-based notifications, too. >> Yep.
2:06:39
>> Yeah, every I've I've I've transitioned from someone maybe a year ago that would click over to Threads when there was like I was almost getting clickbaited by by something to now just like a a lurker because there's like >> Yeah, always in the lurker category. >> the lurker category.
2:06:56
>> to transition from a lurker to a reply guy. >> every No, every Yeah.
2:06:58
Every every reply guy starts as a lurker, right?
2:07:03
I have to build up I have to build up the the confidence to to move into that, but No, it's been it it's seriously impressive and and yeah, the car the car stuff is what I've been following most closely. >> Yeah, yeah.
2:07:16
>> Oh, that's so cool to hear.
2:07:16
We've been doing a bunch with uh F1, too.
2:07:17
I don't know if you guys are F1 fans, but um we have this new feature called live chats.
2:07:22
So, we're trying to do like one of the things people love about Threads is they call it the quiet app.
2:07:26
Like you're in a world right now where every single app you go to is like a sound-on video feed. >> Yep.
2:07:33
>> Um you go to Threads, you can just like quietly scroll, read things that are going on.
2:07:38
Um one of the things that we're trying to do is make Threads the live second screen that is still quiet while you're watching something on TV. >> Yeah.
2:07:45
>> So, we had a like a Q&A with Lewis Hamilton and Ferrari last week.
2:07:47
There's like him and a bunch of fans in a chat that thousands of people can follow along with, react to the messages, asking questions.
2:07:54
We've done this for NBA finals.
2:07:56
Um So, yeah, it's it's we're just trying to be the best platform for public conversation and that just means we have to listen to these live events.
2:08:03
>> Yeah, so it's you're basically taking like what's great about the chat on let's say like a Twitch live stream, right?
2:08:10
It's like this real-time flow of information and ideas, but then making that like disconnecting it effectively from the programming.
2:08:19
>> Yep, tie it to a live event and put like authoritative voices in charge of it.
2:08:21
Um we were talking, John, I think a little while ago about just how well we've done with reality TV.
2:08:27
I don't know if you guys are into the Summer House lore.
2:08:29
I'm not like lives on threads right now. >> Solana?
2:08:35
>> I saw Yeah, I saw Mike Solana on threads discussing some reality TV show.
2:08:38
Maybe it was the the the Traitors or the Is that the one where they play like mafia?
2:08:46
Yeah, there's a couple of these and it just so interesting when you bump into someone who you know in a different context and they're on threads and they're just like like they're sort of like wearing a different It's a more casual outfit basically and like the the the posture can be very political on
2:09:03
other apps or very defensive or very aggressive or maybe they're a particular influencer and they're always you know this just killed this on a LinkedIn but then they come over to threads and they're just sort of just being a normal person in some ways if that makes sense. >> It works. I mean it's it's I think a lot >> It works.
2:09:17
I mean it's it's I think a lot of it's just that people want to wear that hat sometimes.
2:09:20
I mean you were talking about it with like your stuff too.
2:09:24
There's something very like human about building an app that's for conversation and leaning into that and I think in a world where like increasingly so conversation is just very hard to have or the person isn't human.
2:09:35
You know, we're trying to make that the case on threads. So that's been fun.
2:09:38
>> What what is the KPI culture like like cuz you're the quiet app now it's working it seems great but like it feels like there's going to be a moment where it's like okay, well let's AB test vertical endless scrolling video and it's going to outperform and you're going to be like yeah, we're no longer the quiet app.
2:09:56
We're actually just like the second Instagram and like and it just maps out but like it feels like that's not the mission.
2:10:02
That's not the goal but like how how do how will this actually play out?
2:10:07
>> I mean I think that's that's the difference between metrics and goals.
2:10:10
Like it's a You know, the goal is for us to be the best app for public conversation.
2:10:13
I know that I could I could tomorrow pump time spent on threads by putting more video in the feed but that wouldn't make us the best app for public conversation.
2:10:23
So, we try to find metrics that give us as best a possible proxy for that goal.
2:10:28
Um and a lot of times actually it is like how much is there back and forth reply happening on a top-level post. Yeah.
2:10:34
Um you know, in terms of growth, the the names API that the team works on is what we call Threads-driven now.
2:10:39
It's like people that are coming back not because they saw a promotion. Sure.
2:10:42
Um so, you know, my job is to like set those goals, give them the best incentives possible, but then just know that the metrics are going to be imperfect and sometimes I need to come in and you know, make a strategic decision to do something that might be against the metric, like to your point of vertical video.
2:10:56
So, we're not going to do we're not going to do a vertical video tab in Threads.
2:10:59
Like that's not part of the plan.
2:11:02
>> It's going to be a hor- horizontal video.
2:11:03
You will turn your phone and it will be the entire Lord of the Rings extended edition. We're getting 10 hours.
2:11:10
>> [laughter] >> It's going to be enough >> Yeah, 1996 NBA Finals game four front to back.
2:11:15
>> [laughter] >> We won't have to.
2:11:16
How How do How do you think about building your own kind of culture within Meta?
2:11:21
Like is that is that a thing?
2:11:24
Is that something that's encouraged?
2:11:27
Or is it or or is it like, you know, all the you know, one big team?
2:11:30
Or are there Do you guys like Do you guys have like a nickname for for people working on Threads?
2:11:36
Like >> They're not Meta-based. They're Threaders. >> Threaders? >> Threaders. >> Yeah.
2:11:41
We uh we have a very unique culture.
2:11:43
I mean, I I think um like all good cultures, it kind of like happened on its own based on the people that were excited to work on the app.
2:11:51
Cuz I think if you're coming to work on Threads, you want to be on a smaller, scrappier team.
2:11:54
And you probably care a lot about culture and you know, pop culture and the types of things that we spend our time on.
2:12:00
We just had uh you know, actually a team of people in here talking about like how we do that.
2:12:04
Um So, I would say it's like encouraged in as much as as you're like building value around the culture, but like it's really important for us to not build the culture around the idea that we're different and special.
2:12:16
different and special. Um because we get so much value from being at Instagram and meta like all of the infrastructure that we use all of the integrity teams that we leverage the monetization that we do comes from an ad team that's
2:12:29
inside Instagram and so it's like you're trying to strike this balance between making sure people feel identify with the app and the stuff that we're doing but appreciate you know being inside the bigger company where we just get so much value. >> Instagram Pro recently launched 399 a
2:12:41
>> Instagram Pro recently launched 399 a month I believe for some pro premium features I upgraded instantly some fun details I haven't even dug into all that.
2:12:51
>> Who's viewing your story twice?
2:12:53
>> Oh yeah, that's one of the features that they show.
2:12:54
I like the fact I don't post on my story that often.
2:12:56
I like the fact that I can extend it to 48 hours because I'm not a daily story person.
2:13:00
I'm only sharing like news about the show on there when someone else tags me and so just extending a little longer that felt like a valuable feature but are you looking to that for premium subscriptions there are you more focused on the ad product on the monetization side like because it's a new surface area it's sort of unexplored where do you want all that to go?
2:13:25
>> More focused on ads like we're we're not currently working on threads as a part of the meta subscription.
2:13:31
That's a really good high margin business. >> I completely agree.
2:13:34
No, I I I I like the subscription too but I see it as a yes and for sure because the ads business should be so good.
2:13:43
>> I think if threads gets big enough and and we have good you know offerings to people for something like a subscription why not but it's not something we're working on right now.
2:13:50
We did we launched ads globally four months ago and have just been like slowly scaling it in line with the engagement going up you know just trying to be careful about it. >> Yeah.
2:14:00
>> Yeah, what what is different about a conversational or kind of a news driven platform like threads like X versus like a more passive product like you know in the >> People say lean forward versus lean back.
2:14:15
>> question is like the like the question that people have always had with Twitter and X is like why wasn't the ad product like amazing for advertisers?
2:14:22
Why did it never really maybe scale to >> Like was it an ad matching problem or was it a behavioral problem?
2:14:32
>> this like you know the audience on Twitter historically was like so valuable.
2:14:37
The user base was always smaller but you know some of the most important people in the world are on there as like their primary >> Yeah.
2:14:45
>> you know application and so the big question was like why was it never a great ads business?
2:14:49
Do you have any theories like you know what you could say was execution or I could say that.
2:14:57
>> [laughter] >> I won't but >> you could not deny it.
2:15:00
>> Conor Hayes says >> Conor Hayes doesn't disagree with Jordan.
2:15:04
>> [laughter] >> He sat silently.
2:15:07
I don't think it's the format because you know we know from years and years of experience.
2:15:11
I mean think about Facebook ads before the app was so video centric.
2:15:16
That feed format is kind of similar to what you have in like a threads or an X today and that was one of the most efficiently monetized surfaces ever in the history of technology.
2:15:24
So I'm pretty confident that we'll be able to I'm pretty confident that we'll be able to to get threads ads into a really good place there.
2:15:34
The other thing that matters is like you know obviously it's like how much attention are people paying to the content that they see in a feed but also how much content do they view?
2:15:43
Like the more shots you have to show them something relevant the better you're going to do.
2:15:46
So you're going to monetize more effectively if people are viewing 100 things a day versus 50 things a day.
2:15:53
So you know to your point on KPIs John like one of the big ones that our team has is just like how many impressions of content do people have in the app?
2:16:01
And then we try to make that as deep as possible by giving them more relevant stuff and eventually some percentage of those will just be ads that hopefully are really good cuz they come from the Instagram and Facebook ad inventory.
2:16:11
Like advertisers can just opt into their demand going to our surface.
2:16:13
Um it's a checkbox in the flow where they create all the IG and Facebook stuff. Um so I don't know.
2:16:20
I think we're set up for that to do pretty well, but we're just again trying to be careful and not scale it too quickly while we're still making the product great.
2:16:25
It's been under 3 years at this point.
2:16:27
So we sometimes even lose sight of the fact that we're still a bit of a young app in the in the ecosystem. >> Totally.
2:16:34
Will AI-generated ads be more difficult to crack on Threads?
2:16:38
I'm thinking that uh if I'm on Instagram and I have, you know, maybe it's Manis or some MSI or MSL like uh agent that can go take screenshots from my website, reinstantiate them, and put that in an Instagram flow.
2:16:53
Like you're showing me the product, uh job maybe finished, might convert well.
2:16:57
Um but if I'm advertising on Threads and I need a really punchy hook, and I actually need to think about like 140, 280 characters that are really, really high skill ceiling type writing, that historically has been hard, and that's why like brands come off as like cringey often on these short text-based uh mediums.
2:17:17
And I'm wondering, even though we have all this crazy acceleration in AI, I haven't followed an account where I'm like, "Oh yeah, like this model is really good at writing tweets or posts that are 180 characters."
2:17:33
They're honestly better at the writing >> Part of what keeps us >> Yeah.
2:17:37
>> And that's part of what keeps us us popular, I think.
2:17:38
You know, like if there's especially when you're optimizing for conversation, it's at least right now humans are pretty good at telling when they're conversing with another human.
2:17:48
And also there's a lot of metadata, right?
2:17:49
They have a profile, they have a username, they might be verified.
2:17:50
Um I think for ad creative, you know, on on the organic side, posts with photos in them do really well on Threads.
2:17:57
It's a pretty high percentage of the our top performing content.
2:18:01
I think it's probably similar on X.
2:18:02
And so, my sense is that as AI-generated ads get more prevalent, it'll probably be through the image path more than the the text path.
2:18:12
And I don't know, I I'm not pulling off of any data besides personal experience on this, but you know, usually for me, the image is the hook when I'm thinking about buying something or getting, you know, more fond of a brand.
2:18:23
Obviously, the content matters at some point, but I think the image is going to be what pulls people in. >> Jordi.
2:18:29
>> How uh how much do you think about uh what Starlink will do to global connectivity?
2:18:35
There's a bunch of people that don't have internet today that are going to have like reliable, fast internet over the next 10 years.
2:18:40
People coming onto the internet for the first time.
2:18:44
Is that something that you're thinking about or is there just enough people that haven't tried the app yet that that are that are um obviously taking more of the focus?
2:18:55
>> I think probably more of the latter.
2:18:57
Like, we're we're not at the point with growing Threads where we're worried about, you know, lacking more opportunity at the top of the funnel for people that are already online or maybe even already online and using similar services.
2:19:06
The other thing is we tend to be pretty market-focused.
2:19:09
Like, we like I was mentioning before, um I've been really focused on Southeast Asia, Japan, Korea, two of the biggest ad markets in the world.
2:19:18
Um we are very US-focused.
2:19:18
Um and so, in these early stages, I think it's actually really easy, especially if you attract a top-line global number, to see that go up, but not actually build an app that's like meaningful and makes sense and is a big part of people's lives every day in a country.
2:19:35
Um so, I look at success more as like tipping individual countries into Threads being the app of record for public public conversation.
2:19:41
Right now, that's starting to happen in Southeast Asia.
2:19:45
Um and then the US is our our biggest focus outside of that.
2:19:47
So, um from that lens, I I I think in those countries, the connectivity is quite high at this point, so we we worry less about that opportunity.
2:19:57
>> What's the plan to get at Connor on Threads?
2:19:58
You got an underscore sitting there. How did you get sniped?
2:20:01
You're the head of Threads.
2:20:04
>> part about this is the at Connor is an Instagram employee, I think, or he was at some point. >> Yeah.
2:20:10
>> [laughter] >> So, he's locked it down. Wow.
2:20:12
Johnny-come-lately to their platform. >> Yeah. >> That's hilarious. >> It's over. It's over. You're never getting it.
2:20:18
>> Walk me through Walk me through the process of spinning out spinning up a little like I don't know if you call them like micro features or something.
2:20:25
Like the uh a year ago you launched sort of like disappearing ink text like sort of glows and you click spoilers and these little features are uh they seem so simple.
2:20:38
They're probably getting easier to build because of AI tooling, but at the same time like your code base can be kind of a mess.
2:20:47
25 people want to do different things with text at the same time.
2:20:48
Like how do you think about those?
2:20:50
What's the importance of that in terms of the growth? >> Yeah.
2:20:55
So, we we have actually like done a bunch of work to get the process on this right.
2:20:59
I think like social products often, you know, there's so much work that is just like getting the details right, executing well.
2:21:05
But, there's a bunch of work that's just like a hits business.
2:21:08
Like, you know, look at Instagram, getting instance to work.
2:21:12
It's just you got to take a bunch of shots on goal with small creative teams.
2:21:16
So, a lot of the stuff that you see in the app that feels like a little bit more fun.
2:21:21
The music attachment feature we did, animated stickers.
2:21:23
These are like pods of three or four, you know, technical but creative people that we just give a bunch of space to.
2:21:29
We talk to them like once a week or once every two weeks about the ideas they have, give a bit of feedback, and then they've just been coming up with hits.
2:21:38
So, the way that and and your point about AI making that easier is true.
2:21:41
I mean, they I think one of the fun things that we've seen is that design talent has been getting more technical, which has made these things easier to build.
2:21:48
So, whereas in the past you would have two people sparring over how to build a feature, now the really creative designer with great taste can actually develop the thing on their own.
2:21:59
>> That makes a ton of sense.
2:21:59
Well, congratulations on hitting 500 million monthly active users. Fantastic. >> billion soon. >> 500 billion soon.
2:22:08
>> Hey, with Starlink, you never know.
2:22:10
>> Economic imperative, solve the fertility crisis because we need more users and that's the fastest way to get more.
2:22:17
Everyone should be having 10 the 10-child policy rolled out globally. >> Yeah, for Threads.
2:22:23
>> Great to see you so much, Connor.
2:22:25
Congrats to the whole team. We'll talk to you soon. Have a great work. Have a good one.
2:22:27
Um incredible AI futures does it again.
2:22:33
This is a post from Bronson Shawlin.
2:22:35
Says mid-2026, France wakes up.
2:22:38
Europe's leading lab releases Le Chat Fat, their latest open-source frontier model. It's state-of-the-art.
2:22:43
The US and China scramble wildly to catch up.
2:22:45
The mainstream narrative around AI has changed from maybe the hype will blow over to I guess this is the next big thing.
2:22:52
The US enters talks with France to hopefully gain access, but without much success.
2:22:56
I like a little twist on the China wakes up from AI 2027.
2:22:59
A funny copy-pasta at this point, but still again, congrats to Mrall on launching Le Chat Fat.
2:23:09
>> Uh this is important before we're joined by author Luke Burgess.
2:23:12
We have a safety alert from the US Embassy in the Nassau.
2:23:18
Uh Ambassador Herschel Walker has an important message for American visiting the Bahamas.
2:23:21
Ski jet ski rentals pose a serious risk of injury death and death.
2:23:26
US government employees are banned from renting them.
2:23:28
That's how serious they are and you should avoid them too.
2:23:33
Uh really taking shots at the jet jet ski industrial >> A lot of people were surprised to see Herschel Walker.
2:23:39
He's a famous football running back.
2:23:41
Uh this is how they found out that he is in fact the ambassador. Um Fun story. >> Is the risk worth it? >> Jet ski? I don't know. >> a big jet ski guy? >> No, not really. I'm fine.
2:23:54
I prefer scuba if I'm on the water.
2:23:59
>> Every every time every time I'm on a jet ski euphoria. >> Good. You like it?
2:24:05
>> Yeah, it's it's incredible. >> They're fun.
2:24:08
>> Under I think they're I think they're underrated.
2:24:11
I think they're underrated.
2:24:12
>> They feel like very highly rated.
2:24:14
>> Yeah, but but highly rated, but but are people organizing their life around jet skiing? Jet skiing?
2:24:18
[laughter] >> It is nice that it's sort of the experience of a motorcycle with a lot lower stakes, right?
2:24:26
>> Gold Rock says jet skis and vibe coding are golden combo. >> Yeah.
2:24:30
Anyway, let me tell you about Cisco, critical infrastructure for the AI era, unlock seamless real-time experiences and new value with Cisco.
2:24:36
Our next guest is the author of The One and The 99, Forging Identity in the Age of Social Contagion.
2:24:45
Ben, welcome to the show. How are you doing? >> Hey, what's up, guys?
2:24:51
>> What do you think about jet skis?
2:24:52
>> Yeah, we we got to start with jet skis. We got to start there.
2:24:54
>> to start with jet skis.
2:24:55
>> As As one who spends his summer literally on Lake Michigan, I'm offended by that warning, big time. >> Oh, jet skis. >> You love jet skis.
2:25:01
>> We need to generate some positive memetic desire for jet skis. >> Okay. >> There he goes. See? Underrated.
2:25:04
I think they're still >> underrated relative to how fun they are. >> Rent them.
2:25:11
Buying a jet ski is idiotic. Rent. Rent. >> Okay. 50 bucks >> Why? Why?
2:25:15
I feel like I feel like when people say don't buy, they say don't buy the boat because the boat requires so much maintenance.
2:25:19
Feels like the jet ski you just pull it out of the water.
2:25:21
It's not It's going to dry out.
2:25:22
It's not going to need a million dollars in maintenance a year. >> like a boat. It's like a boat.
2:25:27
[laughter] >> Yeah, I mean, it's just what everybody It's still a relatively large piece of equipment that I don't want in my garage.
2:25:32
So >> I guess I guess you don't want to own it because you're probably not organizing your life around jet skiing.
2:25:36
But if you are and you're going to be jet skiing 200 250 days a year 300 days a year, then you might want to own it.
2:25:43
The economic calculus might change.
2:25:46
>> of Malibu is like lack of jet ski launch points. >> Okay.
2:25:50
>> Like it's makes it makes it like uh it's it's good for the natural environment that there aren't, but uh it's tough to be a jet >> from the bluffs to just launch straight in.
2:26:01
>> Anyways, more importantly, let's talk about the book.
2:26:03
>> us the thesis, but uh first, I mean, can you explain what you mean by social contagion? What are some examples? Why that phrase?
2:26:12
>> Yeah, I mean, well, first of all, my the book that I wrote 4 years ago was about the mimetic desire.
2:26:16
So, I want to congratulate uh both of you for doing more than anybody in the history of media uh to generate mimetic desire.
2:26:22
If I'm talking about founders and who's investing in who and the size of exits.
2:26:28
I don't know if you >> Yeah, the gong.
2:26:30
>> built your business that way, but and the gong.
2:26:31
So, you literally are a mimetic machine.
2:26:34
>> Yes, I did work at Founders Fund, so maybe some of it rubbed off. Who knows? >> Yeah.
2:26:38
>> Yeah, yeah, the the the the, you know, people ask us like, you know, how do we book so many guests and and uh early on we saw a pretty extreme flywheel, right?
2:26:49
It's like people see someone they know or someone they like or a company they like and then it just created this uh really crazy flywheel.
2:26:56
Now, it's been for the last, you know, year and a half, it's been more about like managing >> motion machine. >> That's right. >> Basically.
2:27:04
Yeah, it's amazing things. Anyway, take us through.
2:27:08
>> So, this So, this book, I mean, in wanting I had one job and my job I think was to explain the ideas of this obscure French thinker in an accessible way to the world at like an eighth grade reading level and I think I did my job.
2:27:19
But, it meant that I I had one thing to do and there was a lot of things that didn't make it into the book unless my publisher was um he'd be very mad if I wrote a, you know, 600 page book.
2:27:26
So, I took that all the things that didn't make it into that book and I applied some of the ideas of mimesis and mimetic desire to the family, to the education system, to technology, uh to politics and to religion, right?
2:27:39
And one of the most interesting things about And what is social contagion, you ask me.
2:27:43
Social contagion is just the unconscious way that we catch the desires of other people, the ideas and beliefs and emotions of others, and we integrate them into our sense of self and the way that we move through the world without really realizing that we caught these things from other people.
2:28:00
With desire being the most important one.
2:28:04
>> bad because it feels like contagious, it feels like I caught the cold or a flu, it feels like a negative negative twist on mimetic desire.
2:28:11
Desire feels like something that could take you in a bad place, but also could be good and just this idea of of pulling something you want what someone else wants. Like that can be good.
2:28:23
Someone else wants to go to the gym, be healthy, do something like you want to do that, too.
2:28:29
That's probably fine, but contagion feels like it's mimetic desire, but only in the negative.
2:28:33
Is that the way I should be thinking about it? >> No, no, no.
2:28:37
I mean, I'm very clear in the book like there's there's such a thing as good contagion, right?
2:28:39
There's there's things that desires that I want to catch, right?
2:28:42
Like if I want to be more ambitious and take more risk, then maybe I should move to Silicon Valley, right?
2:28:49
So, I think there's there's definitely good good contagions out there. >> Okay.
2:28:52
So, if you want to jet ski more, maybe you move to the Bahamas.
2:28:55
>> You move to the Bahamas, [clears throat] right?
2:28:56
Or yeah, move next door to you. >> Yeah. >> Uh yeah, totally.
2:28:59
Um So, you know, one of the interesting things about AI in the in the book is I'm wondering if it's actually contributing to contagion and mimesis in a way that we don't fully understand, right?
2:29:11
Like it's Did you guys see that Tim Ferriss vlog about what what's happening to his nonfiction books, right?
2:29:17
>> I know exactly what you're saying.
2:29:18
>> He's talking about Yeah, like he had an 80% drop in sales of his book and it coincided with like 2022 when ChatGPT came out.
2:29:25
And he's saying like why would somebody read prescriptive how-to nonfiction when they can go to, you know, ChatGPT or a chatbot and ask, "Well, here's my life.
2:29:35
Here are all the things that are going on for me.
2:29:36
Um apply like what should I do?
2:29:38
And by the way, like summarize Tim Ferriss's book, but make it highly personalized for me."
2:29:44
Like why would you read the book?
2:29:44
Um you get instantaneous, highly personalized, customized advice.
2:29:47
So I wonder though if that is actually going to lead to a form of contagion that we don't even understand because there's something happening in in India uh even the engineers don't fully understand what it's doing.
2:30:01
And it's giving us back something that feels really personalized to us, but the inputs are obviously being drawn by what, you know, large language models and what other people are putting into it.
2:30:11
So I wonder if it's we're entering like a Flurry Boost, you know, that that Apple show kind of situation where the AI is actually, while seeming highly personalized, it's actually sort of contributing to some form of social contagion. >> Yeah.
2:30:24
I feel like we are in the sort of like we're just starting to diagnose the social contagion that breeds on social media, and we're just starting to understand the effects of what seeing certain videos or political biases or even memetics just like you see a sports car and you want a sports car and that changes your perception of things.
2:30:44
Um and with AI it feels like we're in this unknown unknown period where it could it could wind up creating more le pluribus.
2:30:56
It also could wind up being more personal and so everyone sort of goes into their own world.
2:31:00
There's this weird stat where uh like the I think it's like over 50% of high school students are a super fan of some creator that none of their friends know about.
2:31:13
And so they are in this like niche internet micro celebrity world nimcells where they know everything about this one Instagrammer or this one TikToker or this one YouTuber's life, their repertoire, their whole catalog of work, and they talk to their friends and they're like, "No, I've never heard of, you know, Markiplier or whoever is like their choice."
2:31:36
Or you're you're a Doug DeMuro fan and you run into a car fan and they're like, "I've never heard of Doug DeMuro."
2:31:41
because you're in this like niche world.
2:31:42
And but at the same time, you do have this like, you know, the like ideas do spread extremely quickly and we're just starting to diagnose that.
2:31:51
And with AI, it's it's somewhat similar where but potentially even even more removed cuz you might be getting fed Tim Ferriss insights, but it's sanitized of Tim Ferriss's name.
2:32:00
And so, it feels like it's personalized to you, but you're actually doing what everyone else who's asking the same question is.
2:32:07
It's very hard to diagnose.
2:32:09
It's very hard to to track the actual outputs.
2:32:14
What do you look for in in the book in terms of like just level setting on like how things are going in America, the state of things, whether we're on the uptrend or downtrend on a particular category, or even just like the level of mimesis.
2:32:30
That's something that I can't really I don't have an economic factor for.
2:32:34
I can't trace it to GDP or or incomes or anything like that.
2:32:41
>> Yeah, I mean, it's it seems like um the book is basically about the relationship between the self and groups and various communities, right?
2:32:47
And to what extent can we be in something without becoming completely of it?
2:32:51
Um whether that's a political party or a city, you know, if I live in, you know, Vegas, which I did, um there are certain things that I really like about living in Vegas, but there's other parts of Las Vegas that I don't want to, you know, permeate me, right? >> Sure.
2:33:07
>> So, it's like how how do we be part of something and take the best from it and give our best um without without it completely forming us and determining everything about us.
2:33:14
So, when it comes to the state of the US, I mean, I'm finding that maybe it's because of social isolation, but I'm finding people over identifying with various communities, whether it's like, you know, national-level politics.
2:33:29
It seems like when people don't have like a solid sense of self, which is a term that I use throughout the book, like a solid sense of self as opposed to a pseudo self that is constantly adapting to expectations and and conforming as we walk into different rooms and move to different cities.
2:33:43
It's kind of the malleable version of ourselves.
2:33:45
It seems like, you know, to the extent that people don't have sense of self, they're much more likely to be sort of liable to capture by the first group, party, whatever company that comes to them and tells them how special they are.
2:33:59
And I I I I sort of notice this over-identification, right?
2:34:06
That worries me quite a bit.
2:34:06
And it's like groups want everything from us.
2:34:10
They want complete loyalty, which, you know, like right from the very beginning, right?
2:34:13
It'd be like meeting a girl at the bar and like, you know, she's asking for, you know, full commitment right in the beginning or else you don't love me kind of a thing.
2:34:20
It's like, "No, we actually need to take time to like test things and get to know each other.
2:34:24
And it's probably not a good thing to completely identify."
2:34:29
We like to situate people and people like to situate us.
2:34:31
And some people own those labels and some people are kind of repelled by those labels.
2:34:35
So, the book is kind of looking at identity and the way that we how easy it is to situate people and how we can become, you know, how can we become a little bit immune from being overly situated ourselves?
2:34:47
And the most interesting people to me, I don't know, like a like a Taleb kind of a figure, are those people that are really difficult to situate, like politically.
2:34:56
You never quite know what they're going to say.
2:34:58
They're the most interesting people for me to follow.
2:35:01
>> Yeah, Renaissance man maxing.
2:35:03
What do you think of the maxer culture?
2:35:05
Because that feels like the in in many ways like the worst-case scenario of what you're describing, where whether it's looks maxing or fitness maxing or whatever maxing you're doing, it's like everything else about the identity has to go by the wayside.
2:35:19
And we saw this very interesting clip with clavicular, the popular looks maxer, where they ask him about politics, and he doesn't even have a read on any politics whatsoever because it's completely irrelevant to what he actually cares about, which is just looks.
2:35:35
And it feels like there's the inverse of that, which is someone who's politics maxing or left-wing maxing or right-wing maxing, and they don't have an opinion about anything outside of their political domain.
2:35:45
And if you ask them about health, they would have to tow their particular party line.
2:35:49
And that it feels like in the competitive sphere, maybe that's something that's going on with maxing.
2:35:56
But how have you been processing that that trend of maxing? >> Yeah, yeah.
2:36:01
My my colleague and friend Jordan Castro did a whole thing on clavicular, who you've seen on the show, and which is worth watching.
2:36:07
I I mean, my book is is an anti-maxing book, and I think maxing is evidence of exactly what I'm talking about because when you max anything, like what are you giving up in order to do that?
2:36:17
Like you can't max everything, right?
2:36:18
So, I'm I'm pro like maxing in my marriage. I'm pro maxing love.
2:36:23
Um but apart from those things, like there's really nothing that I want to max because it turns me into an individual that I mean, what's interesting to me is that there's some people that just max one thing, and then they get exhausted, and then they just look for another thing to max.
2:36:36
And that was me throughout my 20s, right?
2:36:38
I was maxing on a company so hard um that I didn't even and I didn't even like it, right?
2:36:44
And then I'd get bored with it, and then move on and start another one and max on that one.
2:36:47
It's like maxing cannot be an end in itself.
2:36:50
>> I went I went through this with uh with health.
2:36:51
Like there was a period of my life in college where I would it felt like 80% of my attention and energy was just going towards being healthy.
2:37:05
And I eventually got to the point where I was like, "Okay, the point of at least for me, the point of being healthy is so that I have energy to do other things and I and I can feel good day-to-day, hopefully live a long time.
2:37:18
Uh and I just went from the I I went from like 80% down to like 10% and I probably got a a little bit less healthy, uh but it just freed up all this energy to do other things.
2:37:28
But, the benefit of going through that maxing period is I learned like a lifetime's worth that I now still get the benefits of and that's part of what probably keeps me higher from a health standpoint than my than my previous baseline.
2:37:41
So, I would say for me it's like going through periods of obsession has been healthy, but it's like how do you how do you remove your how do you eventually figure out the time to remove yourself?
2:37:54
>> So, it's fun to grind, but you don't want to get lost in the sauce.
2:37:58
>> Periods of obsession is the is the keyword there, right?
2:37:59
Periods of obsession and >> Yeah.
2:38:02
>> I don't know if um anybody's done some kind of empirical research study on this, but I would guess that a very low proportion of hardcore maxers have children.
2:38:12
So, you know what I mean?
2:38:14
That's been a game-changer for me.
2:38:15
>> Instinctually, I I think everyone agrees with the uh that makes a lot of >> If you had to turn your book into a Tim Ferriss-style self-help book that would then be summarized by an LLM, [laughter] what would the output say?
2:38:31
>> Well, it's not a prescriptive how-to book, first of all.
2:38:34
Um >> But, hypothetically, turn it into one.
2:38:37
>> What would it say if it were?
2:38:38
>> No, but but but but but to >> me like periods of obsession and not getting lost in obsession.
2:38:44
Uh >> Well-rounding, maxing, and Renaissance man maxing. >> Yeah.
2:38:48
>> I mean, it would it would probably tell, you know, I think that we're really bad at leisure and especially like ambitious entrepreneurs and founders and I've been one for most of my life.
2:38:58
Um so, one of the things that it would probably tell people to do is actually think of leisure as a skill that you should actually have to get good at. I suck at it.
2:39:05
I remember being at a beach in Thailand when I was starting one of my companies and I could not rest. I could not sit still.
2:39:10
I could not have any fun at all.
2:39:12
Um so one of the things that we do at the Clooney Institute, which Jordan and I run together, is we quite literally offer really busy founders and people the opportunity to come on like humanities retreats and chill out for a couple of days and think about the human person and think about important questions with the promise that they're going to go back uh refreshed and with a better sense of what they actually want.
2:39:31
Might want to max out on for a couple of days actually.
2:39:34
But like like leisure is not a is not a popular thing to talk about and in this world, but um you know, learning to do it well has been one of the most important innovations in my life.
2:39:44
>> All ties back to the jet ski.
2:39:44
I do my best thinking on the jet ski. >> Yeah.
2:39:49
>> You got to be able to turn off.
2:39:49
It is really, really hard.
2:39:50
Where do you stand on uh on digital detoxes, dumb phones, uh black and white screens, those sort of like dopamine uh like dopamine fasting little mini techniques that people like?
2:40:04
Sometimes they can go they can become their own their own pursuit and their own obsession, but uh where do you stand on all of that?
2:40:15
Like what what is the secret to like unplugging, I guess?
2:40:18
>> Yeah, I mean I think you've got to know yourself.
2:40:19
The micro mini little tools have never worked for me cuz I'm I guess I'm like an all or nothing kind of guy.
2:40:24
So I have to like go hike the community Santiago for 30 days to to witness any change whatsoever, right? For better or worse.
2:40:31
This is like the kind of guy I am.
2:40:33
If if it's like some incremental n plus one change that I'm making to like, you know, I don't know, the background of my screen, it doesn't do anything for me.
2:40:41
So like but to each to each his own on that stuff.
2:40:45
>> Uh well, thank you so much for coming on the show.
2:40:47
The book >> Thanks for sending this.
2:40:49
>> which is the one and the 99.
2:40:49
Go pick it up wherever books are sold.
2:40:52
Thank you, Ben, for coming on the show. Good chatting with you.
2:40:56
We got to do this again soon.
2:40:57
This is a really great conversation. We'll talk to you soon.
2:41:00
Have a good rest of your day.
2:41:00
And let me tell you about Shopify.
2:41:02
Shopify is the commerce platform that grows with your business and lets you sell in seconds online, in store, on mobile, on social, on marketplaces, and now with AI agents.
2:41:11
And without further ado >> Speaking of agents >> our final guest of the show, Anda Ganescu from Notch. >> That's right.
2:41:19
>> co-founder and CEO, Anda. >> What's going on? >> Welcome to the show. How are you doing? >> Great to see you. >> Hey guys. I'm good.
2:41:23
Good to see you, too, Jordy. Good to meet you, John. >> Good to meet you.
2:41:27
>> It's an honor to have you on the show on a big day.
2:41:30
>> Uh take us through the news.
2:41:30
But first, introduce yourself for everyone.
2:41:33
Introduce the company a little bit. >> Yeah, thank you.
2:41:36
Hey guys, my name is Anda.
2:41:37
I'm the co-founder and CEO of Notch.
2:41:40
Notch has been the leading digital intelligence and optimization platform for Fortune 500 brands for the past 6 years or so.
2:41:46
And our news today, coming live to you from the Guggenheim >> The Guggenheim?
2:41:51
>> where we've taken over the Guggenheim for the day is that we just announced Ace, which is infrastructure that makes websites convert both humans and agents. >> Okay.
2:42:02
So, what what is the what was the first big client that you brought on board, the first big logo?
2:42:07
What did you actually try and move the needle for them?
2:42:12
Uh how much of that is focused on e-commerce conversion versus brand building, broadly marketing?
2:42:16
Like where's the surface area of the impact of the product?
2:42:23
>> So, when we started going to market, we actually moved from Silicon Valley to New York uh with my co-founder.
2:42:26
And some of our first clients were the biggest banks. They still are.
2:42:30
Um if you can think of the biggest bank in the in the world, they're our client.
2:42:34
Our service area of impact, look, we we track our audiences' journey through digital experiences, and we help brands understand what's resonating with these audiences, what's not, and how they can ultimately gain more customers by making better content and better digital experiences.
2:42:51
>> Uh with with Ace, uh this feels like a product that uh people have realized that they need uh really acutely over the last year.
2:42:58
We had Matthew Prince on.
2:43:02
I believe it was maybe the middle of last week and he had recently shared that there's more web traffic from agents now than humans.
2:43:13
That flip came even faster than he was expecting.
2:43:16
And so now there's a bunch of Fortune 500s that you guys are working with that are kind of waking up to this, realizing that they need a solution.
2:43:23
But I guess talk about kind of the the origin of the new product.
2:43:30
>> What we saw across the biggest websites in the world, which we measure with Notch, what we saw was the same thing.
2:43:35
There were more agents starting to come to websites than humans.
2:43:37
And about a year ago, every single CMO became obsessed with GEO or AEO, which is how do I make my website readable to agents.
2:43:48
But ultimately LLMs cannot be gamified.
2:43:50
And the tricks of GEO, which is publish another 100 blog posts and 10 other product of FAQ pages and whatever, it ended up really destroying the human experience.
2:44:03
So in the last 6 months, we've actually seen crazy high immediate bounce rates.
2:44:07
Like human beings that actually arrive to websites are getting a horrible experience because they're presented with this agent-ready, agent-first content.
2:44:14
So Ace, the origin story was really how do we build a system that can personalize for each of these audiences without taking away from the experience of the other?
2:44:26
>> And that's making the agent side invisible to humans and and vice versa.
2:44:32
Like how how does it actually work?
2:44:34
>> Yeah, so let me tell you how it works.
2:44:35
So Ace is first of all, we have to ingest all of the brands' knowledge from currently it's sitting in silos.
2:44:39
The website is just one area where that knowledge exists.
2:44:43
So we ingest that knowledge alongside brand guidelines, governance, etc.
2:44:46
That knowledge gets vectorized and atomized and then it gets semantically tagged.
2:44:50
This step is really important because what you want is to enable both the humans and the agents to retrieve this information through natural language.
2:45:00
Then we start to reassemble the information based on implicit inputs.
2:45:05
Like these are the kind of the data signals that we've been capturing through Notch for the past 6 years.
2:45:10
And that reassembly enables for a really personalized human experience as well as a personalized agent experience.
2:45:15
So, for example, I'm a mom.
2:45:17
I've been looking for an electric car that doesn't look like a mom van and I've been doing my research in LLMs and I know nothing about cars unlike my husband.
2:45:24
And so I type in electric car that doesn't look like mom van and it's telling me to go to, you know, gm. com, rivian. com, etc.
2:45:34
When I get to that website, which I will still go on because I want to validate the information.
2:45:38
I want to see like is this brand the brand that represents me?
2:45:43
What I get is really static, really generic, essentially a dumb website that doesn't actually speak to me.
2:45:46
And so it's a very jarring difference.
2:45:48
And LLMs have really conditioned us to expect conversational experiences and the ability to really command these experiences through semantic intent.
2:45:56
So what we've built with Ace is the ability to give GM the capacity to allow people to just copy paste their research from an LLM, put it on the site, or just simply say I'm here to, you know, find an electric car that doesn't look like a mom van and then the site reassembles with dynamic atoms in response to what you just said.
2:46:16
So the whole website comes to the to the home page. There's no more pages.
2:46:21
It's really just dynamic reassembly based on your semantic input.
2:46:25
When an agent shows up, the same thing happens.
2:46:27
It's the same knowledge base.
2:46:29
It's just visualized differently.
2:46:29
It's a different modality. It's really just code. >> Very cool.
2:46:34
Yeah, there's so many people talking about like generative software, software that's created on the fly, but forgetting that like websites in their current form mostly have just been like effectively digital catalogs that are kind of they're just one one version of it. But that's very cool.
2:46:51
I wonder um Yeah, the the idea of like, you know, it it And that's that's like I've in some ways I've like stopped going to a lot of websites because I know it's easier to get the information that I really want.
2:47:06
But the thing is like then the brand is losing like full control over how they're being displayed.
2:47:10
Maybe they want to be showing like images of different points that and and obviously the the the chat app or whatever consumers using is um you know, they don't have any control over kind of that whole service area, which is rough.
2:47:28
>> Yeah, they really don't.
2:47:28
I think the website as we know it to date is definitely dead.
2:47:34
I think we have to replace the word too.
2:47:36
Like I'm I'm starting to play with knowledge site because I think what really matters in tomorrow's world, whether or not humans still come to your experience, right?
2:47:42
What matters is that you have that knowledge in a knowledge base that can speak to agents.
2:47:46
Right now, what brands are doing is they're just cramming a bunch of crappy content into the same website and it's not personalized for humans and it's not personalized for agents.
2:47:56
And so the experience of course is going to turn people off and people are going to stop going to websites.
2:48:01
So we got to enter a new era where websites are dead and long live the knowledge site.
2:48:07
>> What's the long-term uh sorry.
2:48:09
>> Oh yeah, no no my my immediate thought is like you want the you want like the source of truth. >> Mhm.
2:48:15
>> And then you want to be able to effectively just prompt the and be able to get the information that only matters to you.
2:48:20
But what were you going to say, John?
2:48:23
>> I was going to ask about just the the obviously you've seen a ton of success in the enterprise.
2:48:28
Are you thinking about going down market?
2:48:30
How do you think about that?
2:48:32
What are the decisions that would that would lead you to work with smaller companies or is there just so much valuable so much value in such a unique problem in the enterprise that that's where the company will be firmly placed for long term.
2:48:48
>> We're going to go everywhere, John. We have big ambitions.
2:48:49
I think this product that we built can serve everyone.
2:48:51
And actually, if you go to our website, it's running on Ace now, and we've built it in the past 48 hours because, you know, we're a startup, so we leave things last minute.
2:49:01
But if you go to our website and start start prompting it, I'm sure like I just said this, and so many people are going to go try to break it.
2:49:07
So, you know, knock yourself out and send us feedback if you manage.
2:49:11
But yeah, I believe that any company needs to have a knowledge base that's accessible by agents that they can control and maintain in a really structured governed way.
2:49:20
I also believe humans are not going away.
2:49:22
Like every time there's been a new tech trend, whether it's social media or something else, we've always been like, "Guys, this is it.
2:49:29
All we need is a Facebook page."
2:49:31
I don't I don't believe in zero-click marketing.
2:49:33
I believe humans like choice.
2:49:35
I believe especially for high purchase high high-intent purchases, we really like to do our research.
2:49:41
And so, I believe websites are going to be around because, you know, it's kind of a yes-and situation with marketing.
2:49:47
It's always LLMs are just another channel ready to talk to my board.
2:49:52
>> Yeah, I just went to notch.
2:49:52
com as you said and tried it and very cool to have the the bar on the bottom.
2:49:57
You can just and then and then they basically just create a section that's just like effectively generating whatever information you want, which is like John's talked about this before like Ramp, you know, who we work with like it's nice to have access to language models within the application, right?
2:50:12
You don't Sometimes you want to take it, you know, back to your preferred agent, but having intelligence where you are already um makes a lot of sense and I and I wouldn't be surprised if this is like, you know, hopefully you guys capture as much value as possible with this like new paradigm, but I'm sure a lot of other people will will happily follow suit. >> Yeah.
2:50:34
>> Well, John, I think there's actually a great use case for TVP and as well.
2:50:35
So, if you guys want to be customers, I'm I'm all ears.
2:50:39
I mean, you guys create so much great content and you're truncating it in a really great way, making it accessible in a way that enables you guys to, you know, just give people the information they really came there for would be cool, too. So, >> Yeah. Let's talk. >> Let's do it. I love it. Well, thank you so much. Website is not okay.
2:50:56
Go check it out and get the demo today.
2:50:59
Thank you so much for coming on. >> Thank you guys.
2:51:00
Really appreciate you having me on. Bye.
2:51:03
>> Have a great rest of your day.
2:51:04
>> Let me tell you about Codex.
2:51:04
Codex is a powerful workspace for getting work done with AI agents, whether you're writing code, analyzing data, creating content, or automating business workflows.
2:51:11
Codex helps you move projects forward from start to >> Over on X, Daniel's advocating for banning social media for over 65s.
2:51:22
>> Yes, yes, the inverse of the UK's project or the UK's initiative to ban social media for under 16.
2:51:30
Over 65, I think that would ruffle some feathers.
2:51:33
Uh that would probably be pushed back on more by the social media companies because the purchasing power from 65 onward is so high.
2:51:41
Uh there's so much wealth with the boomer generation.
2:51:44
Uh that would actually be very devastating to uh Facebook and YouTube and TikTok even.
2:51:51
Um the young folks, I think all the social media companies have an incentive to get those users as early as possible, keep them on the platform.
2:52:00
Uh but I think more than anything they want a level playing field.
2:52:03
So, Connor Hayes can duke it out with every other social media uh site as soon as someone turns 16, try and acquire them, try and get them on board, but we'll see as that rolls out and where the guardrails are set.
2:52:19
>> We'll close out the the show with uh Sean Frank.
2:52:21
Everyone is doubting Meta.
2:52:23
Spenders are mad at bugs and model changes.
2:52:25
Investors think they're missing AI, like the AR saga all over again.
2:52:27
But as a large-ish customer who will spend something like a hundred million dollars with them this year.
2:52:33
Meta is working and no ad space comes close to their level of scale. Don't doubt the Zuck.
2:52:38
Uh It the fact that you can buy that that you could have one SpaceX or two Metas for the same price is uh pretty unbelievable and certainly not something that most people would have guessed even a year ago. >> Yeah.
2:52:59
It is a crazy crazy situation.
2:53:03
At the same time, rockets, they're inspiring.
2:53:07
And social media is so >> Totally.
2:53:09
I mean, I can see how I can see where you got here, but it's still surprising.
2:53:12
>> But yeah, uh obviously fantastic business and uh yeah, people are probably need to, you know, reality check with Shawn Frank cuz he's in the trenches.
2:53:21
He understands the business better than most, so go pay attention to him.
2:53:26
Anyway, thank you for tuning into TBPN today.
2:53:30
>> It's been an honor and a privilege.
2:53:31
>> Leave us five stars on Apple Podcasts and Spotify.
2:53:34
Sign up for our newsletter at tbpm. com. We'll see you tomorrow. >> Goodbye. >> Cheers.