2025 in Review, Cursor Acquires Graphite, TikTok's $50B Profit | Michael Truell & Merrill Lutsky, Pranav Myana, Anna Goldie, Edward Mehr

Watching TVPA is Friday, December 19, 2020.

Merry Christmas.

We have maxed out the amount of Christmas that is possible in the TVPN ultradome. We are, of course, live from the TVPN ultradome. The temple of technology, the fortress of finance, the capital of capital. I don't know if we're gonna make it through the show in this costume.

I don't know.

I'm gonna be honest up front. Everyone, we appreciate you. We're very thankful this holiday. But this is a lot for a three hour broadcast about technology and business. And also, we have some very serious people coming on the show today. Michael Truol, the founder of Cursor. Isn't it like a $30 billion company? He's coming on the show. Feels a little disrespectful. They just acquired our sponsor, Graphite. Graphite. It's very exciting, honestly. It is a fantastic partnership. Makes a lot of sense. We're going to have both founders on the show, breaking the deal down, giving us an update on Cursor's business and Graphite's business and how they fit together. The meme is we're generating so much code.

What's the bottleneck, John? Bottleneck.

Reviewing it. That's right, Graphite. And the other bottleneck, of course, is dealing with your finances. So head over to ramp.com this holiday season. Time is money save both easy use corporate cards, bill payment accounting, and a whole lot more all in one place. I want to take this off, but also I feel like it looks really good. I'm really into this.

My thing is I need to figure out how to get these monitors.

If we play a video. Jordy can't hear it right now. Also, this delicious Diet Coke right here. I can't partake because I have this massive beard. Your beard looks much wilder than me.

Well, it's because I have. It's because I have.

What's going on with.

Cause I actually. I have hair up here. You see this?

Oh, yeah, you have. Oh, you got a hair.

Yeah, yeah, yeah. I have a whole wig.

Mine's pure beard. His somehow the dual sand.

Anyways, okay, so, folks, the lesson this week is that we started Christmas on Monday. We started really strong. We talked about how certain advertisers, including Amazon, got into the holiday season a little too quickly.

Yeah.

Little did we might backfire on them. Little did we know we maybe did the same thing.

We did the exact same thing.

But it has been a very fun week and we're excited to finish strong.

It's really so good this might be more entertaining than our Halloween episode. Just because there's like Halloween. There was nothing else in the ultra dome that was Halloween themed. It's not like we had pumpkins and like, you know, ilyaps, like accoutrement or anything around us. It was really just us. The Christmas spirit has been building and building and building and I honestly have zero regrets. I have zero regrets. It is ridiculous. It's over the top. Just like Julius. AI is ridiculous and over the top. As far as AI data analysts go, Julius is the AI data analyst that works for you. Join millions who use Julius to connect their data, ask questions and get insights in seconds. Yeah, we might take some of this off.

This is back to.

Anyway, thank you. We just wanted to say thank you to everyone for an amazing year. What a wild ride. So at the beginning of the year.

This show, remember last year, didn't we do like a Christmas Eve episode?

I think so.

We just weren't willing to stop.

Yeah, no, it was a really intense schedule, but we weren't live, we didn't have guests, we didn't travel for the show. We had this whole I have Santa here all over me. Yeah, we had this whole thesis that like what was missing was actually just two people hanging out, having a conversation. And there actually were a lot of interview shows that were doing a great job. Of course that all played out way differently. We have the numbers. We actually did 225 live streams this year. Thank you to so many of you in the chat that I know we're actually watching for all 225 of those. There's a lot of you. We recognize you all, we know, we've learned all of your names. It's been fantastic hanging out here with you every day, chatting across those 225 live streams. We interviewed 912 unique guests and we're also doing another five today, I think. So we're still adding to that, but we almost hit a thousand guests. We said, oh, we're going to do a thousand guests this year at a.

Certain point have come on a lock.

Some guests have come on a lock.

We know the record holder for this.

Year down in Asparuhov with 18 guest appearances. We've done 12, 19 interviews and 8554 posts on X. So I mean just every day, 10 posts, basically 20 posts, 30 posts. A lot.

Joe Weisenthal and Senra are tied for number two, both at nine. Wow, that's a lot of clear power law here. Yeah, well, we can pit them against Each other next year and say, you don't want to. Do you want to be? Do you want to? You should go for number one.

I'm surprised Gliman's not up there. I mean, there's been a few times when I called Gliman. I don't know if that counts because he's not on the lineup. I just call him on the phone. But obviously, thank you to Ramp. You've heard the ad read every day at the top of the show, but this show would not be possible without Ramp. They took a huge gamble on us when the show was really, really small. They said, hey, we're down to sponsor this show for the whole year.

And of course, adquick and public.

So many so.

And the others that came in incredibly early and allowed us to scale into the production that it is today.

Yeah, yeah. So you'll be hearing, of course, from all of our sponsors throughout the show, and we really could not do the show without them. So thank you to all of them. Interesting. The first guest ever was Ryan Peterson. He took a wild, sort of a wild move, just jumping on a live stream with us. We'd never done a guest ever, and it was live. It was very odd. We could talk about anything, but he was totally down to just hop on. And it was a lot of fun.

And he ended up coming on a lot this year because of how much chaos there was in global trade.

Yeah. So that was a lot of fun. Gary Tan hooked us up with the ability to stream from YC Demo Day, the palace of party rounds. That was a super, super cool moment. And I just remember getting texts from people when we first went live, so we'd never taken the show on the road. And then Gary said, hey, why don't you go do the show from YC Demo day? And we did. We set up our table, the sports center, the step, and repeat. And we brought this, like, insane energy. It was a really loud room, which was actually a feature because we were screaming the whole time. It was crazy. And I got so many text messages like, are you guys live streaming demo day. This is crazy.

Yeah. That was our NFL combine. Yep. And of course, FIGMA was our Super Bowl.

Exactly. So we got to go to the New York Stock Exchange for the FIGMA ipo. And again, you know, huge, huge gamble for Dylan to let us hang out with everyone there. We got. And I feel like we landed on a very unique product, interviewing basically the whole board of directors on IPO Day. Less focused on price action, more focused.

On the story, which was Crazy.

Which was crazy.

The stock was up, stock was down. It was a fantastic day. And honestly, if we'd been like, we're all making money, it's, you know, that might have been a different thing, that might have been better, but it wasn't us. And so we stayed focused on.

Yeah, it wasn't for, you know, a retail investor that wanted to trade the stock.

No.

It was for people that had used and loved Figma.

And that was the energy that years. That was the energy that we were feeling in the timeline. Like a lot of people on the timeline were like, I've used Figma when I built my company. I use it every day.

I've worked across multiple jobs, across multiple companies.

Totally, totally. And I think that's something we always wanted to come back to is like the posters that make the show possible, the timeline. This show is unique in that. That is very much our backbone. Obviously we read the Wall Street Journal, we read a lot of the news. But for some of the funny moments, some of the funniest moments, some of the most interesting folks we've had on the show, some of the anons that have come on has just really allowed us to wind up in a different place. Before we move on, let me tell you about restream one livestream. 30 plus destinations. Got to say thanks to them. The show seriously would not be possible without restream. If you want to multi stream go to restream.com so I was looking back.

At some of the original love that we got from different people. I remember Balaji texted you super early on and said great set and production value. Jackson texted one of us, the same, Jackson Dahl. Jackson Dahl. Very early and so many others.

Yeah.

And yeah, we thank everyone for supporting us early and sunburn feed me helped.

Us throw an after party after the Figma ipo. That was a lot of fun. I think it was the first time I met Joe Weisenthal in person at that party. Then we wound up going on his show. He came on our show a ton. That was a lot of fun. Obviously, thank you to all the sponsors and also thank you to the media that makes the show possible with the fact finding.

They find yeah, I think early on people wanted us to have this sort of adversarial relationship. Adversarial relationship with the media. But at the end of the day it's been very. It's incredibly symbiotic. Media does analysis, fact finding, all different sorts. We incorporate it into the show and the show wouldn't be possible without that.

And a Lot of the profiles, I mean, from the very early days, we were reading like a New Yorker profile of Mary Meeker and that gives you like a certain flavor of what tech was like at that time. And, you know, without the legacy media, the traditional media, the corporate media, the new media, legacy new media, the Neo legacy media, without all of them, we couldn't do what we do. And then, of course, thank you to the team, the massive, fantastic team here at tvpn. We have had a fantastic year with them.

They've grown absolute legends.

Everyone's figured out ways to improve the show. Every little thing that you see on this show, across the Internet, across everywhere where we exist is due to someone on our team being inventive, coming up with a strategy for how that happens, then implementing it and then executing it every single day like clockwork with Extreme.

And it's a performance. Everything that you know, as we're sitting here hanging out talking, they are doing an incredible amount behind the scenes, making sure that the show is dialed. And we've certainly grown a lot if you look at some of the, some of the early shows and how even the just the overlay evolved. And it's really been the highlight of my career working with all of you guys. So thank you for being part of this. Should we play that? They made a video?

Yeah, yeah, let's play it. Let's watch it.

Pull it up.

We have a little year in review video that we're going to watch here on the stream. And 2025 is going to be a fantastic year. Lock in.

The locking in that you do today will benefit your great grandchildren.

I agree.

If you do it right.

Yeah.

So do it, do it, do it like two years.

Today is Meta Connect 2025. We'd love for you to hit this. Gone for us.

There we go.

Congratulations on Meta Connect 2025. This is a big moment for us. I mean, we just started a couple of months ago. It's been. This has definitely been on like the vision board of like one day and now we're here. So thank you so much for hosting us.

You're watching tvpn.

We have some fantastic news. We have a partnership with the New York Stock Exchange.

You're watching TVPN.

You' from GitHub Universe.

Let's give it a quick hit for 27%.

Strong hit.

Great hit.

So good to meet you. How are you doing?

There he is.

Welcome. I can't believe he showed up. The Halloween episode, the Christmas episode, and.

The response was like, would you ever spend 250k on a car.

And then I took that literally. That was the best. That's the scoop of the year. Sam Altman has a good sense of humor. You guys are really important to me.

Good luck to you guys.

Keep doing what you're doing.

You're just. You're just electric.

There we go.

What you guys do is great.

I also think that you're transforming the way that media is dispersed each week.

And you know, and it's awesome you guys are X doing what you do and elsewhere.

So thanks so much.

Thank you to everybody that has made this possible by tuning in, join the show and supporting us however you have. So have a wonderful evening and we will see you tomorrow.

Thank you.

Take care.

Good night.

Having the snow effect.

The snow effect is not baked into the underlying video. That of course will be shared on.

Anyways, thank you. Thank you, Ben and the Hole and Nick and Scott and Michael for making that. You guys, you guys are the best. Correction, actually shout out to Jackson who made that video. No way. What? Wow. Legend. Legend. Amazing. And Tyler, do you have any news for us? Oh, yeah. Contract extended. Gap year. Gap year extended. Tyler is not going home.

He's not going home.

Well, he's going home for the holidays. But he's coming back to the Ultra Dome next semester.

The jaws of life.

Contract extended. He's sticking around. It has been truly incredible having you here on our set and contributing to the show in such a special way. And yeah, we should probably figure out a new title at some point. Other than Intern.

Intern doesn't really make sense.

It made sense for a minute, but you're much more than an intern. You're a technology brother. So thank you for being a part of this.

Thanks for.

Can we get the Gigachad? Can we get.

Yeah, can we at least Gigachad this band?

Giga Chat, this.

Come on, please. Production. And I mean, we have to thank everyone that actually watched the show. Everyone in chat. We appreciate you and everyone who watched. Everyone who. There are so many ways to experience what we do. That is by design. We want to let people, we want to meet them where they are, obviously in an RSS feed, in a cut down, in a diet TBPN product, in a 20 minute version, in a cut.

Down, in the newsletter.

In the newsletter, in the trading cards. The trading cards themselves are a way to experience what we do here. And so thank you to everyone who enjoyed any of that, no matter how much or how frequently you did. We appreciate you. Anyway, let's go to the timeline. But first, let me tell you about numeral compliance, handled numeral worries about sales tax and VAT compliance so you can focus on growth. So speaking of gap semester intern Tyler, Jane street is putting up trading cards.

No, this is not fake.

This is fake Street. Wait, what's going on here?

I think this is this guy Mason.

Okay. Oh, he made it for himself.

He made it for himself.

Oh, but he's going to Jane Street.

From his account, Mason.

Has committed to Jane street for summer 2026. Congratulations to Mason. That's an awesome shop, awesome place to go and what incredible performance. Almost 10,000 likes on this Instagra post. But VAR Epsilon here is saying software engineering intern recruiting slowly turning into college football. It should. It's arguably higher stakes.

Nick in the comments, fantastic. Abizid from Rivet says they call this the TVPN effect.

Just like this. That's a good one.

The deal director. The TVPN effect is escaping.

Hey, isn't the deal director in the chat right now? Thank you, deal director. It really has. I mean, obviously we didn't invent the trading card or like this format. This has been used by complex and in many ways you can trade trace this type of media back to the New York Post or any sort of even tmz. I remember the first time I made one of these trading cards for I think it was Will Menidis playing with model boats on the little pond in Central Park. I looked up, how does TMZ do it? Okay, let me recreate that basic Photoshop template. Now, we've kind of taken it in a different. In a much broader direction, but it's just a fun way to relay information.

This format shouldn't be reserved for celebrities and people that throw around balls for a living.

Yes, I completely agree. We democratized the trading card this year and I'm glad we did. Before we move on to the big story, which is that TikTok is absolutely printing, let me tell you about Cognition, the team behind the AI software engineer. Devin. Crush your backlog with your personal AI engineering team. So TikTok owner ByteDance is on track for 50 billion in profit in 2025.

Big.

That's so much money. So this is from Bloomberg. ByteDance is on track for profits of roughly 50 billion, capping a record year for a Chinese social media leader making major inroads into E commerce and new markets. I mean, it truly is like their hyperscaler. They own a ton of different stuff. Gaming, social. It's so much more than just TikTok. And that's very, very clear in the Financial results. The Beijing based parent company of TikTok is on track to hit that milestone after amassing net income of about 40 billion over the years first three quarters. People familiar with the matter said it's already surpassed its internal target for 2025. This that would take the company's earnings close to that of Meta platform. So bytedance is now basically the same size as Meta, which is insane. Meta is of course earning about 60 billion this year by TikTok. Success has come over under scrutiny after the Biden administration led an effort to ban TikTok. ByteDance is now close to finalizing a plan to hive off the video service in the US which will.

It's going to be American made, American made.

Well, American document, American made, potentially. Obviously short form video debates over exactly how that will happen, but Oracle is potentially in the deal. Despite Washington's scrutiny, TikTok has expanded globally at a rapid clip, including in the U.S. it has been pushing aggressively into E commerce and livestream shopping. Much like the livestream shopping thing, it feels like it's so, so big over there. I wonder if it's, you know, it's somewhat growing here, but it does feel like it still feels like it has not hit a fever pitch in the United States the way it has abroad. The same day that Sho Chiu, the CEO of TikTok, announced he had an agreement, he'd reached an agreement to sell TikTok. TikTok held its first ever Oscar style red carpet show, the TikTok Awards in Los Angeles. That sounds fun. It's unclear how much ByteDance has increased revenue. This year the company had targeted 20% rise which would be $186 billion and that would cap years of 20 plus percent growth for the company. Founded in 202012 by Zhang Yiming, ByteDance has created several of China's most popular digital service, Toutiao Douyin, a version of TikTok for the mainland market. It's also vying with incumbents Alibaba and TikTok.

So quick overview of the businesses under the ByteDance brand. They have Douyin, which is the Chinese version of TikTok. It's quite a bit more feature rich.

Feature rich, right? Oh no.

So no, no, it's more feature rich. So it's like more focused on retail. Bigger, bigger live experience. They have like hotel bookings, movie bookings, things like that. They have Tao Tiao, which is a news like content aggregator.

Yeah. And Artifact, which was created by the Instagram founders. They were kind of dipping their toe back into like Creating a social media. Of course one of them landed at Anthropic, but Mike Krieger landed at Anthropic, but that was sort of like maybe if that works over there, Very, very similar news aggregator could work over here.

And they have Xi Guo, Xi Guo, which is like more of like a YouTub style business. Then they have Dubao, which is apparently China's most popular AI chatbot, so something like ChatGPT. And then they have a bunch of other sort of tertiary businesses as well as capcut. If you use Capcut, the mobile editing app, they.

I didn't realize I was biting this product. Wow. If you want to use the Meta version, they have Edits, which is pretty good. I've used Edits a few times and it's pretty full featured at least so TikTok has signed a deal for the sale of the United States unit. The deal should close January 22nd. This is from Sarah Fisher, the media correspondent at Axios. She says that Oracle, Silver Lake and MGX will collectively own 45% of the US entity. 30% will be held by affiliates of existing ByteDance investors and 20% will be retained by ByteDance. So ByteDance, you know, the Chinese entity sort of becomes the minority investor. It sort of goes into American hands loosely or Western hands. And then of course the rest of the process can be handled and you have more leverage to address like where is the data stored, how is the algorithm trained?

Us all the US venture, the joint venture is going to be focused on data protection, algorithm security, content moderation and software assurance. So retraining the content recommendation algorithm on US user data to ensure the content feed is free from outside manipulation. Will be interested to see if there's any noticeable effect for TikTok users.

Let me tell you about fall generative media platform for developers develop and fine tune models with serverless GPUs and on demand clusters. Megan Bobrowski over at the Wall Street Journal has a scoop that Meta is in fact developing a new image and video focused AI model codename Mango.

I like it.

Alex Wang and Chris Cox talked the new models Mango and Avocado in a Q and A with employees this morning. One of those employees said I gotta tell the Wall Street Journal about this. It's too good. It's too good.

It's simply too good.

It's too good. I gotta let them know. No, who knows how they got the scoop, but it's a great one. Good name models are expected to be released in the first half of 2026. I mean they have A lot of data. They should be able to train a great model. I wonder if it's enough to get to just release a frontier model and really see any usage or if this is. Again, it's like it needs to be vended into Instagram, into meta properties. What do you think, Tyler?

I mean, I feel like it's very natural to vend this into Instagram and like this model. Like I would be very surprised if people are surprised by this. Right. Because like the mid journey in vibes, like, that was not msl, that was not Alexander Wang.

Yeah, yeah, yeah.

That's just like the product team.

Yeah. But they've done a lot of work to marshal, compute, build huge data centers. Like they're ready for a big run.

Yeah.

And they have the data. Yeah. I would expect this to be good. Have you been following those posts that are like, we're comparing ChatGPT images in ChatGPT versus Nanobanana Pro and you can sort of tell the difference, but it does feel like it's starting to be a spiky intelligence moment where I think.

Nanobanana is generally better at putting text or like if you want to do some kind of charts.

Yeah, charts, graphs, illustrations.

ChatGPT Images is better for like maybe.

Artsy or stuff and character consistency so you can tell a whole story across and ChatGPT seems better at that.

But without further ado, we have some very special guests.

Tell us more about all this. We have Michael Truel and Meryl from Graphite and Cursor. Great to meet you, Michael. Great to see you, Merrill.

Good to see you too.

How are you doing?

Good to see you. Amazing. It's a fantastic and exciting day for everyone at Graphite. We're thrilled about today's announcement and super excited to work. Michael and Tim.

It makes so much sense. And yeah, we're excited to have you guys break it down. So. Yeah. When did. When did the conversation start?

Yeah, so we started chatting, I guess. We've known each other for like six years almost now. We've been. Yeah, yeah, we've been. We. We both went to. There's the startup camp program that one of our shared investors did. Did like 6 years ago where we met for the first time. And then our teams have kind of always known each other. There's been a lot of over. Cursor was a big user of Graphite. We're big users of Cursor. We started talking back in the summer when we were building. We started to think about building integrations with background agents and thinking about how we let our users call background agents from Graphite so you could create, Review and merge PRs all in one place. We started chatting with the Cursor team. It quickly became obvious that we shared a lot more than just our, you know, just our biggest investors were, you know, we think about the world the same way. We have a super similar vision for where devtools are going. Their New York office is literally across the street. I can, I can see their window from right here. So it's, it's, it just made so much sense.

Yeah, yeah, yeah. Michael, please.

I was just going to say, as we got to talking, like Meryl mentioned, we both think about the future pretty similarly, where we both believe that the way people build software over the next five, 10 years is going to change radically. A lot of coding, as we know today, will be automated.

And.

We think very similarly about the ways in which code writing will change, but also the ways in which teams collaborating will change. And Graphite has focused really intensely on the team collaboration problem and how you help people review each other's code. We focus really intensely on the single player experience of how you develop software as an individual programmer. And so we're excited to kind of marry the two together and build a crossbow.

Michael, I would love to get a year in review for Cursor or even more broadly, just the state of software development quantitatively, qualitatively. How can you explain the way writing Software changed in 2025?

It's changed in a big way. I think at the highest level, agents became useful in a professional setting, and that really expanded the demand in the market. And I think we're still early. I think it can be really easy to underrate just how far away coding is from being automated and still building professional software takes so many people over such a long period of time. And there's lots of issues we need to contend with as AI coding becomes deployed more broadly. But it was a big year where you went from being able to just ask some quick questions to an AI about your code base and how it kind of help you out with the next 30 seconds to 5 minutes of your work to being able to hand off whole tasks to an AI and.

Have it do and Meryl, the shape of graphite. Obviously, we know that you're growing quickly. How did you perceive the changes that happened this year? If you look back on 2025, obviously this deal is going to be something you remember forever. But more precisely, how do you think that the developer experiences?

Every time I'd catch up with Merrill, he'd be like, there's a lot of code to review, so we're busy. And that' in a big way is Michael's fault.

No, that's the funny part about it, I think. Cursor has just so dramatically changed the rate at which we can build features and how much code engineers are able to generate. And what's happened consistently. The bottleneck has now just shifted to the rest of the process, what we call the outer loop, where now we need tooling to help every team review and validate and merge changes at the rate that you can now generate them with tools like Curso. That was basically our 20, 25, has been, how do we both apply AI to this problem? How do we use more traditional or deterministic methods like merge queues and stack PRs and other workflows and tools to make that process more efficient? But how do we just unblock this bottleneck that is now is kind of like preventing teams from really realizing the true potential of tools like Cursor. And that's been our mission this entire year, pretty much. And part of why we're so excited for this partnership is that now you can put the surfaces where you write code and where you review and validate and merge it together and just have that seamlessly integrated. You shouldn't have to jump to a different tool for your editor, for code review, for your PRs, for CI. All this should just be one nicely integrated surface. And that's always been the dream for graphite in our vision. I think now that can become a reality.

How are you guys thinking about the integration process and how graphite fits into the sort of Cursor platform family? I think a good first step would be like maybe a walkway between the offices in New York.

A skyway. A skyway, yeah.

We've talked about the little string and.

Cups, you know, so you can.

Yeah, we'll put a zipline over Broadway so that people can commute back and forth. No, I think that there's some really obvious, low hanging fruit of things that you'll see us roll out in the coming months. And then there's a long tail of, like, even more ambitious ideas that we have that are in the works. But immediately, like, I remember earlier this year, a few of us on the Graphify team were up in Toronto meeting with Toby and some of the Shopify engineering leaders. And they're one of our biggest customers and close partners. And the biggest ask that they had for us was how do we get context from our IDE or from tooling? Where we're writing code with AI into pull requests and have that be seamless and have the same chat history, have the agent logs and everything show up in the PR and be able to then call out to the agent to fix things again. And we were like, huh, that's an interesting problem. Maybe we should think about working with cursor on this. And I think that's kind of the most obvious thing that we can do to start with. And then we can build from there on many of the other ways that we can kind of connect all those surfaces together and have the agent be able to help you all the way through from the moment that you generate the code to the moment that it's merged in and out to production.

Yeah, I'd second that. There are going to be a bunch of opportunities for some quick ways in which we can make the experience of working together in graphite and cursor better. But then the big thing will be going heads down on a much bigger build together where we'll have more to share late in 2026.

Michael, I'd love to get an update on how you're thinking about just growth opportunities as segmented by sort of like, like scale of the customer. We've read some, you know, like the AI, like the models are great, the tech is amazing. There's still some odd resistance to adopting AI in certain enterprises. We're not at 100% penetration with these tools. Is there more opportunity in the near term in large enterprises and transforming the way those businesses work? Or is it just the ground game of going, getting every SMB online? Like how are you thinking about growth in 2026, 2027?

We've been shocked by the demand across the board. And so on the mid market and smaller company side of things and the self serve side of things broadly, there are all these rules of thumb for when the growth of that business tops out in developer tools or in kind of other comparable markets. And the thing that's just shocked us and shocked all of our investors is that the growth has been compounding really consistently at the same growth rate over the course of the course of many years into the revenue scale that we are now and that just continues unabated.

So yeah, is that sort of like an IT spend thing where like a small and medium, a small, medium business might just say like, okay, we don't want to spend 10% of revenue on IT spend or technology and maybe the new paradigm is actually helping with so much growth that they're able to underwrite a larger investment in Technology is that what you're seeing comes from more people.

Using cursor and people deeper, both ARPU and for helping people and how much code we're writing for people. And then also the number of people using cursor within companies and across companies, which has consistently been growing. And one big change for us this year is just the upmarket motion has developed faster than almost any upmarket motion has ever, where at this point 64% of the Fortune 500 pay us in some way. And it's both penetration into digital native companies. So for instance, Nvidia is a big customer wall to wall Adobe, Uber, Salesforce, which I think in a public earnings announcement recently mentioned that they're seeing over 30% productivity increase in. And it's also companies that aren't digital native too. It's shocking how many companies are software companies and so Starbucks, PwC, Hilton, companies like this are deep customers.

Where are both of you seeing any resistance to adopting AI specifically in software engineering? Are there any? I'm thinking of like the Japanese soldier on the island, you know, that doesn't know the war ended. Are you seeing anybody trapped left on an island?

I think that. Well, I think that this is kind of true of how tools are bought broadly. But it's really important. I think the way you procure these tools a little bit different, where the difference between having the best product and the third best product from some incumbent that's now six months old is really, really big. And then user behavior needs to change and the way in which your team works needs to change. And so you need to teach people within companies how to work differently. And so we've seen a lot of success in not just rolling out the tool, but also teaching folks within companies too. But it's really spanned across all types of development. I think that there's still some languages where there's room for improvement in how much AI can help folks, especially some super legacy languages. But I think where there's resistance, it's mostly a problem of teaching and kind of learning new habits that makes sense.

What kind of advice are you giving somebody that's maybe in high school or college that wants to get into software engineering, but is concerned about just the overall rate of change and how good the products and models are getting?

I think it's actually really exciting time to get into building things on computers and probably on a relative basis especially exciting for people who are new and entering the field just because it's just quick for them to pick up new habits. And so I tell them, yeah, to experiment with the tools, to try things out broadly. And also, I mean, working on a solo project by yourself is very different from building a giant piece of software with hundreds of other people. So getting exposure to like a real professional development environment too, I think is helpful learning.

Yeah. And it seems more and more obvious that there's just so much software that needs to be built. I mean, we've experienced this year where we have built a software tool internally to help us run and run the entire show. And we are a business that even three years ago we wouldn't have been hiring a software engineer because we would have either used off the shelf SaaS or would have just taken so much resources it wouldn't have been worth it. So. So there's just so much to build.

Yeah. It's almost trite now, especially in the Bay Area, to say software is important. And if anything, I feel like it's kind of like reached a point in technological maturity where you don't even really think of software as technology. Just think of it as like, oh, it's a website that someone built. But yeah, I mean, it's shocking how much progress across the world really is just bottleneck. By building things on computers. You talk to people in AI research. What's the bottleneck to making the models better? There's a few, but one of the biggest ones is just building better infrastructure and just the speed at which researchers can code. And it's true in other areas too. For instance, I worked at a biotech company at one point and one of the big bottlenecks making progress there was analyzing data and picking the next set of chemicals that people were going to try out. And it was dealing with crappy software from off the shelf vendors or building a whole software team to build it yourself. And so, yeah, I think that it's this amazing lever on productivity in a bunch of different verticals.

What are the research paths that excite you the most or that you think might be underrated? Example would be like when we talked to Sholto during the Claude 4.5 launch and he was talking about not image processing, not image generation, but image processing. And that actually makes a lot of sense because a real software engineer needs to look at the web page that they designed and then interpret that and understand the code that they write, how it feeds into the result. Are there any areas of research or less obvious. It's not just a coding model. Research paths that you're particularly excited about in 2026?

Yeah, I think that the capability gains we've seen in our Space have actually there's been like a lot of details to figure out, but there have been a few really big ideas that have worked just like have been levers that people have pulled on continuously.

Sure.

And so pre training is one that's been talked about a lot. Taking models, scaling them up, turning them on Internet scale data. Another big one that's been really important for our space is curating a set of games for the models to play. So for us that means collecting a set of or in our space that means collecting a set of code bases, writing out tasks, having a set of tests to test if the model actually solved a task when it writes a pr. And the big AI companies have done this really well of getting thousands, tens of thousands of really hard games for the model to play and then teaching the model to play those games. And in turn the model then gets better at programming. And so I think that there's a bunch more juice to squeeze both from pre training and then RL with this verifiable reward. But I think that there's going to be some new big ideas that are needed to really get to a place where you can hand off end to end most of the professional development tasks you do in a real world.

Does that make you especially excited about some of the NEO labs that are, I would say fairly controversial at this point? Because on one hand it feels like we need new ideas, but on the other hand it's like it's a lot of money. It's a lot of money and it's a lot of money and it's unclear if you just go and try to compete with.

It's always scary when there's a lot of, lot of funding, not a lot of revenue.

Yeah, yeah.

I think Crystal is actually doing a great job at this. Their own models internally.

Yeah. I was about to ask, do you think that you're going to become more of a lab over time?

No, I mean what we want to do is we want to build the best way to code with AI. And so we have lots of amazing partners that we're really excited to continue working with over the course of the next few years that are working on things that look like AGI. We've ever since the start of the company, we've kind of picked our spot where we are going to do our own modeling work. And those have looked different from the places where the big AI companies, the big labs, do their modeling work. And so for instance, all our TAP models, like the things that are looking at what you've done in the editor predicting the next things you're going to do. Those are our own models. We're on the sixth generation model there. They learn continuously by looking at what people are doing for sure and figuring out how they can get better. And so I am really excited for us to invest a bunch more in research, do lots more ambitious stuff, but it'll be in a little bit of a different direction from what some of these labs might do. And so, for instance, we're really excited to build models that are some of the most capable in the world at programming, not the most capable in the world at programming, but are very fast too. And we think that over the course of the next couple of years or over the course of the next year, Agent usage encoding is going to kind of bifurcate into in the loop or completely async. We're in the loop. You're sitting down, you're like working with the agent in a pair programming way. You want it to be very fast and extremely smart. And then async is going to be. You're talking to a colleague, you just hand off something end time. And you want it to be definitely, definitely, definitely correct. And I think that very soon we would like to play a really big part in making that human in the loop experience excellent. And I think that there's a lot of useful modeling work to do there.

Very cool.

How do you think about the X for Y meme? I feel like cursor's been very successful in that there's a certain rite of passage in Silicon Valley where once you become like Uber for X, it's like if you're the Uber, it's a good place to be. And cursor for dogs, cursor for bio, cursor for travel. This has become a meme. Is there a where is the line for what cursor will do and what cursor will not do? So when I talk to the anduril folks, they'll say, well, the anduril of submarines is anduril. But if I said the anderal of stoves or the anduril of of watches, it's like, okay, I don't even know what that means. That's fine, I'm not going to build that. You actually can go build that company. Where's the line of what cursor will do over time versus what's something where you might like the cursor for X model but it's not on your roadmap?

Well, we'd like to make it possible for anyone to build anything they'd like on a computer. You know, another way of putting that is we'd like to automate coding.

Sure.

And half of that's a model problem. Half of that's a product problem. And we want to do deep, important work across and. Yeah. So squarely. Squarely focused on helping you build things on computers.

Yeah.

And that, for us, that means an intense focus on engineers. And then increasingly, the fold's going to expand too, where lots of technically light Personas, like designers and product people, they also work with cursor, too.

Sure.

And one of the things we're excited about is that that fold can broaden as the product gets better, as the technology matures. But I am really excited, actually, for cursor, for X's to exist in other spaces. And when we started the company, we kind of thought that the shape of company, where you pick an area of knowledge work and you kind of make the cockpit where that knowledge work happens, like the products that people daily drive for that form of knowledge work, you make it. You shape it to where the tech's going, you make it great for where AI is. And then you also see where AI is helping people and where it's not helping people, and you use that to make the underlying models better, both by doing a little bit of your own, also by working with partners. That kind of shape of company we were really excited about. And I think it's going to exist in all sorts of different areas of knowledge work, whether it be mechanical engineering or writing or science, biological science and other places. Yeah.

Is graphite the cursor for pull request? Merrill, did you ever think about that positioning? Because I've done. I literally. I think I've done 250ad reads for graphite, and I've never. Hey, it's the cursor for pull requests. We said it's code review for the age of AI, of course. But do you think that you fit neatly into that framing of the cockpit, where the work happens, that you improve, or is there something that's a different positioning? And I'm wondering how that might change over the next few years.

Yeah. I think one of our investors, Gokulam, has this framework that we reference a lot where you're either you're building a dashboard company or a pipes company in B2B. And if you're a dashboard company, you have to be like something where one type of user, every single day at work, they're coming in and doing a certain task, and that's just their home screen. Or you want to be a pipes company where it's like you configure it, you set it and forget it and it just does throughput and prints money for you. And we've always thought about Graphite as the dashboard. We've said we want to be the home screen for developers. We want to be the place where everyone comes in and checks like, where are my code changes in flight? What do I have to do in order to unblock my team and keep everything moving? And I think that's one of the things that's so exciting about this partnership is that now you really can be the 1 dashboard for engineering. If you want to write code, if you want to build something, if you want to move your changes through the rest of the process, that can all happen on one nicely integrated surface now and really make that vision a reality.

Yeah, that makes sense.

Well, I'm so excited for both teams. I'm incredibly excited for you, Merrill, and the whole team at Graphite as, as a, as a graphite customer starting at the age of 25 to a partner now. It's been incredible to see the journey and you guys pairing up just makes so much sense and it's been a massive year for you both. I'm sure 2026 will be even bigger. And thank you both for, for joining. To celebrate with us. We should, we should hit the gong again for you both.

Yeah, I think, I think this is the gong worthy moment.

Definitely, definitely. And I'm sure, I'm sure the two of you guys won't have much of a. Much of a holiday, but we hope you can enjoy at least a little downtime with friends and family and can't wait for next year.

Yeah, we'll talk to you soon. Thank you guys.

Thank you guys.

Goodbye.

Incredible.

What a great partnership. That feels like such a great. Just match made in heaven.

Absolutely. Let's go over to heaven.

Dana White and the Meta board. This is a match made in heaven. Very funny. On multiple levels. Let's play this clip. While the team is pulling it up, let me tell you about adeo, the AI native CRM. Adeo builds scales and grows your company to the next level. Let's go. Never stop clapping. And now AI. Let's play. Have you got into AI yet?

Yeah, we're dabbling.

Okay. So Meta AI. I got, you know, I'm on the board for Meta. I just got back from a Meta board meeting. So. Good. Zuckerberg, who was a brilliant gangster, this guy, gangster, calling him a gangster, these people who, who try to talk about him and everything else. I'M so blown away and impressed by this guy. He's an animal.

Animal.

I agree with that. He is an animal. Putting all the chips in on AI. We just hired like 10 kids that are aged 22 to 28. The average salary is like $65 million that these kids are making. And so many. This is the final league. Everyone's wondering way more positives about AI than negative. So you start looking at AI and getting into it and asking, AI, how do I build my business?

How do I.

You know? And it'll start giving you some ideas and hold on, you can. Is he saying $65 million is the average salary per year?

I think so. I mean, I think of a salary. I think of a salary as a. As an annual thing.

So 10 times. That's. That's insane.

And Noah in the chat says, meta engineers with a 600k salary.

Okay, so yeah, yeah, keep playing this from here to Tulsa, Oklahoma, you'd have to go on a map and you'd have to lay out, you know, your route and all you got to do the same thing for your business, map out your route for 26. When I first saw this, I thought he was saying, like, AI will be able to get you directions. And I was like, google Maps can do that.

Okay. So when I see this, I just.

It's actually a great metaphor.

Entrepreneurs can get stuck in a loop of just wanting to meet and talk with people and like, get ideas and get strategies. And AI is really good at that. You can say, I have an E commerce company, I want to grow. What should I do? It'll give you a bunch of ideas. And it's like, it just shows how worthless a lot of ideas are and how important execution is. Some ideas are priceless, right? It's like you want to execute on the right ideas, but oftentimes to find the right ideas, you got to try a bunch of stuff. And so AI is at the point where it can give you the perfect strategy, the perfect playbook, even if it's like kind of the average playbook across business textbooks and blogs and posts and things like that. But in the end, you just still gotta go do the work. That's the hard part.

Yeah, I mean, I still think there's like, he is using, he's using a metaphor. I think he's actually a pretty good communicator here. He's using a metaphor that people understand. It's like mapping technology, Google Maps for business, for answering other questions, unstructured questions. AI can tell you that. And, and if you Think about before you Google. Okay, well, my business needs a website. How do I set up a website for my business? Okay, I need to go to the store and get a book. Web development for Dummies. This was the thing I remember back in the 90s, it was like, java for Dummies, you're going to build. Now it's like, AI, Obviously, we just talked about this. And so he's right. He's delivering it in this sort of funny way and he brings this crazy, this crazy energy to the performance. But he is correct in the pitch, in this idea. He's actually correctly pitching super intelligence, personal super intelligence. And for a lot of people, that's exactly what they want. Now, he doesn't really address the fact that there's incredible competition from Anthropic and OpenAI and Google on this front. But that's not what he's addressing. He's addressing just the idea of, of, like, is AI useful? And the guy is like, we've dabbled with it, we've used it for answering, you know, like doing subtitling, basically.

And I think what's under. So Meta has pitches, like, the next.

Level of, like, what's possible.

Meta has something, I think three, three and a half to four billion monthly active users. And so I think in those board meetings, you have to imagine they're saying like, yeah, there's a lot of competition. Yeah, ChatGPT has a big user base. Yeah, Gemini has a big user base. But we have 4 billion people that we can start distributing. If we build a great model, we can start distributing it through WhatsApp, through Instagram, through Facebook, through the Meta AI app, et cetera.

Yeah. I was listening to Ben Thompson this morning and he was doing app reviews, like the review of the top paid apps and the top free apps. So the 2025 top paid apps. And this is wild. It's like, have you heard of any of these? I know, Hot Schedules, Shadow Pocket, it seems like Procreate. Have you heard of any of these? Procreate?

No, because I check the charts a lot.

Skyview, I've heard of that. Tonal Energy, Auto Sleep, they're all like a couple dollars. And most people have not really heard of any of these. If they have it, they're like, oh, yeah, I use this for this one little thing. Or this is a niche thing. And then you go to the top free apps and it's like, trillion dollar company. Trillion dollar company. Trillion dollar company. It's literally ChatGPT, Threads, Google, TikTok, WhatsApp, Instagram YouTube, Google Maps, Gmail, Google Gemini. And so Ben's point was, if you like ChatGPT, yes, they are the number one app, but they should be scared because Google has 1, 2, 3, 4, 5 in the top 11 or something like that. And so the distribution is just so powerful and Meta has that distribution, so they're also a contender and they can stay in the game.

So the top, the number 22 free app right now. Number 21 is Instagram, number 22 is whatnot, number 23 is HBO Max. And on the paid side, currently 21 is Threema Secure Messenger. Sounds like an even sus version.

Sounds insecure.

Yeah, sounds very insecure. Number two is Pocket God, which is a game that includes Call of Booty.

Wait, Call of Pocket God. Isn't that a nickname for AGI? AGI has been solved.

This is just like a mobile game. And then number 23 is jingle real Motion Shaker Instrument.

That sounds like the Ibear app. Let's go.

It basically is. You shake it and you can play bells, you know, sleigh bells, that kind of thing.

You know, most of those, if they're on the top paid app store charts, they're probably making money. And the software is probably developed in linear, the system for modern software development. Linear streamlines work across the entire development cycle from roadmap to release.

What does Casey Neistat have for us?

Casey Neistat did a project with the meta quest 3 where he scanned his studio. He says it's pretty rad. You can walk around and look at stuff and get close. I specifically did not clean the place before. We scanned works on your phone and on the headset. Let's play this. Can we play this full screen, too? That'd be interesting. I want to see the full screen. Have you watched a lot of Casey Neistat? Have you seen his whole facility? I've watched enough of these.

It's one of the coolest. It's one of the coolest studio spaces.

Yeah, it's very inspiring from a production perspective because it's practical, but it also has so much character that it tells you a story. And so even when he's just filming a little product review and he's making the seventh video of the month or year or whatever, you're brought into his world. You understand who Casey is. Every single one of those items tells a story, and it's just. It's just really cool. So, yeah, and I remember we could.

Go hang out if you have a quest. We've done a demo of this feature but we weren't doing. We scanned like a very normal room.

Should we. Should we give Tyler a challenge to actually get this up and running?

Scan the ultradome. I tried for, like, I don't know, maybe two months now. You've been able to do a couple experiences on the meta quest, but you couldn't record your own yet. And I mean, I'm not sure if it's actually. I guess it is out that you can do it yourself.

So I'm not saying scan the ultra.

Dim gigachad elf is so.

I love the gigachad elf. That's so good. So, yeah. I'm not proposing that you. You look so ridiculous. I'm not proposing that you scan the ultradome. I'm proposing that you stop enjoying your jawline. He's on that wild Roman again. He's on the wild Roman.

Lay off, Tyler.

But what I'm proposing is that Casey Neistat shares a link there. Horizon.meta.com World, a bunch of numbers. And if you click that in the headset, I believe it takes you to that world. But how long do you think it'll take you to actually get into that world? That headset. Wow. You're old now. I don't like that. I don't like this one. That's not fun. No, no, no, no, no.

Hey, pa. Hey, Pa. I like it. I would like to be still doing this when you look like that. Yeah, I enjoy it.

But how long.

Do the sad. Do the sad face.

The sad face is the funniest one. It's so funny. The jawline is crazy. It looks so real. It's so good. I don't like this one. No. He really looks so sad.

What's wrong? Tyler? Cheer up.

You know what will cheer you up? Privy. Privy makes it easy to build on crypto rails, securely spin up white label wallets, sign transactions, integrate on chain infrastructure, all through one simple API.

The economist is saying industrialists now list Gundo, along with Silicon Valley and Tel Aviv, within a triumvirate of the West. Triumvirate.

Triumvirate.

Triumvirate.

It means three powerful pillars.

That's a new one for you. Learn something new every day.

Yeah, we gotta get you on the Anki mobile. Flashcards. Little space repetition.

Yeah, yeah, exactly, exactly. Of the West's most important innovation hubs.

Yeah. America's fight back against China starts in Los Angeles. It is real. I mean, it hasn't happened overnight, but the progress, I think, has been faster and more real than people expected. I think when Augustus was First posting in. What was it, 2023. So the next post, Fast Company did a profile on Augustus and they actually referenced me. And they said. Two years ago, in a widely viewed interview with the tech world chronicler John Coogan. That's me. Dericko was jacked and tanned. Triple glaze. Hit that glaze. That's ridiculous. The glaze is insane. A high wattage presence. At ease in his role as Gundo Super Connector, as Coogan described. I did describe him as that. They asked me for comment and that is a direct quote. I do think he's the super connector. And for a long time it was like, if you are going to El Segundo, check in with Augustus, ping him first. He will get you hooked up.

Do not step foot in El Segundo. Checking in with the Don.

Yeah. Without bringing. You need to bring a white monster as an offering. And maybe some nicotine pouches to pay your respects if you're a venture capitalist. I mean, there was a whole while. It was like VCs from all parts of the world. And then celebrities started being a pilgrimage. Celebrities would go on the pilgrimage.

I remember a lot. Gill went and then he posted a zincan on.

That's right. Yeah.

He spelled Zin wrong. I remember that.

Oh, yeah. Z I N. Okay.

So Augustus was quoting this picture from, er. Erebius of saying, this is what rebuilding America does to you. This is Zane Down Down.

Knox Metals. We interviewed him on.

I mean, this transformation is insane.

It's really.

This goes incredibly hard.

It's really the, like, frazzled wojack who's just, like, strung out, all black.

I have a block of metal from Zane.

Oh, no way. That's from him.

Yeah, yeah.

He gave me the nyc.

That's very cool.

Very cool. Yeah, yeah. He sacrificed his innocent self to rebuild our country.

Well, we thank him for it.

Forever grateful.

But the funny thing about this fast company is that. So first they say Derico was jacked and tanned. And then he said, these days, Derico shuttles between cold warehouses on early morning flights. In more recent interviews, shadows mark his face and there's a wary fatigue to his posture. They're just like. I was texting with the guests and he was like, why do they have to say I fell off? Why do they have to say I lost my pump? But I'm sure he'll be back in the gym anytime.

Hey, he never said it was going to be easy.

It's bulking season anytime. You're always welcome to bulk back up. No, I had a great experience making this video, it's very funny. I met Augustus and he just seemed like an interesting character. So I was making videos about big established companies. So I didn't really have a format that worked for a seed stage. Founder with just an idea. He was pre teal fellowship. He really, I don't think he'd raised any money. He was just like somebody.

But you knew from the beginning that Augustus was a Joe Rogan CEO, 100%.

So I was like, I gotta do content with this guy. What can we do? And so I went with Ben out to the Salton Sea with Augustus and we drove out there. It was like a two hour drive to the Salton Sea, sort of out by Thermal, actually a little bit further. And we drove around and we walked around and we filmed like this walk and talk interview out in this crazy, like, you know, deserty sea. Because the Salton Sea used to be like a proper oceanfront hangout spot. Then it got overly salinated and there's dehydration. A lot of the water that flowed in got drained away. For farmland, there's some good trade offs, there's some bad trade offs. But his whole thesis was like, hey, we can bring it back with cloud seeding.

The bad trade off is the land just became incredible, incredibly toxic.

Fallow. Yeah, exactly. So you can't grow anything. There's still a couple people that live out there. It's pretty, it's a pretty crazy life. Like it's mostly just like a tourist destination. People go see it. But it was very interesting, like concrete example of like the Rainmaker promise. And so we had a good time. We did an energy drink tier list which was very fun.

Yeah, somebody sent me that recently.

Yeah, it's awesome.

So apparently Sean in the chat, Slab City is out there. The Slabs unincorporated off grid alternative lifestyle community consisting largely of snowbirds in the salt and trough area.

Huh. Interesting. But yeah, we filmed this and I was like, I don't know if this is like a full video. There's not really a full story. This is just like a hangout session. But then when it became clear that he was that although he was the CEO of Rainmaker, he was also this Gundo super connector. And there was this interesting movement happening in El Segundo. I reframed the video to be about the El Segundo movement broadly. And he was like a main character in that story. And then that video did very well.

Well, didn't you kind of, didn't that kind of kick off the like hype cycle?

I was a link in the chain. I was like. I think I was like, he kicked.

Off the hype cycle.

No, I was. No, no, no. There were a few other things because Scott Nolan wrote thank God for El Segundo in Pirate Wires. And there were. And there was maybe like one other substack who had written about it. And then of course, there were a bunch of posts and then.

And there were the founders there that were actually.

Of course. And they did the whole thing. And then, and then I'm gonna forget who it was, but there were a whole bunch of traditional media folks that came in and wrote really interesting profiles and of kind of told the story. It was a lot of fun. Anyway. Figma think bigger, build faster. Figma helps design and development teams build great products together and get started with Figma. OpenAI has declared code Red multiple times. Bloomberg is reporting. An executive said this. OpenAI has declared code Red multiple times. It's not a Code Red if it's Code Red every day at your company. You know what? Nowhere else, it's Code Red right here.

Code Red, Code Red. Yeah, we heard.

Maybe that's what it was. Yeah, it's Code Red everywhere. One put on Santa outfits, it's Code Red time. Santa's sack is red. The reindeer, the sleigh, these things are red. He was just getting in the Christmas spirit, guys. It was not anything about the business, it was not anything about the shaky ground. The real question that Rachel Metz over at Bloomberg will have to get to the bottom of is, okay, so there's been multiple code reds at OpenAI. How many Baja blasts have there been? Because we know that after every Code Red Red, there is an equal and opposite blah. Baja Blast that gets the.

Well, what is, what is a. What does success look like for Code Red? It's a Baja Blast.

It's a Baja Blast. Baja blasting your way to the top of the charts, the top of the benchmarks, the top of the fundraising cycle. So Rachel Metz over at Bloomberg says Sam Altman's decision to declare code red at OpenAI earlier this month may have caught the industry's attention. But it wasn't the first time that the artificial intelligence company has done a Code Red. The San Francisco based startup Leaderships has made the same decision previously, explicitly instructing employees to drop lower priority tasks and concentrate on a single goal. I'm telling you, it's entirely a comms issue. If so, Mark Chen is on the record here. He says we do this when we want to have this focusing effort on one particular channel topic. Mark, there's a phrase for this that doesn't turn into a negative press cycle. It's called a lock in. You just tell everyone it's time for.

The great lock in.

Time for the great lock in. And if you say OpenAI declares it's time for the great lock in, that's exciting. Everyone's excited.

People are going to rally around.

Everyone is going to go through the roof and just be like, this is so bullish. This is so bullish. It's so bullish because you can be at the top of your game and if you declare a great lock in, everyone's just like, oh, no, it's gonna be even better.

They're gonna go even harder.

But if you declare it's Code Red and you're at the top, OpenAI's they're literally at the top of the app charts. They're like the best, right? Like, they're on so many things that are at the top of the benchmarks. Everything's going very well for this company. But when they declare code Red and it leaks, then it makes you feel like, oh, maybe something's not going so well. If you declare a great lock in, you're good to go. The latest Code Red came two weeks after Alphabet Inc's Google released a widely praised new AI model that outperformed OpenAI's best software on a number of benchmarks. OpenAI Sam Altman called for staffers to redirect internal resources to speed up improvements to ChatGPT and delay progress on all other efforts, such as autonomous AI agents and advertising. So they delayed ads. Very rough for us as fans of advertising. Speaking of advertising, graphite.dev you think we're not gonna do an ad for graphite even though we have Meryl on the show? No, we still do the ad. We have respect for advertising. Code review for the age of AI. Graphite helps teams on GitHub ship higher quality software faster. What it means to me this is from Mark Chan. He says what it means to me is on chat, on reasoning on the core ChatGPT product. It is this focusing effort to make sure we get the fundamentals right. Chen said that includes ensuring the chatbot works quickly and reliably. I think hot take maybe 2026 is the year of speed. Maybe. Maybe customers cannot tell the difference between 120 IQ chatbot, 130 IQ chatbot, 140 IQ chatbot.

What can they tell the difference?

Speed.

That's right.

If they have to close the app, come back five minutes later, oh, my Deep research report is here. I think the model's plateauing on wowing me with they're already AGI's here, they're already super geniuses at everything. They already know everything.

They're supernatural. This mirrors what Michael from Cursor was saying. He was like speed. We're focused on speed.

Yeah, speed I think is going to be really important. I mean that's the weird thing about the cursor and I mean we learned this from the Chad IDE saga was like we wouldn't even have the opportunity to put brain rot and gambling in the IDE if you weren't waiting around for the IDE to respond and actually get back to you. So I think speed in the ide, speed in the chatbot. We've seen this nanobanana really really fast. ChatGPT Images v2 I forget exactly what number is. I think it might be 1.5. But the latest iteration that came out this week, much faster, giving people more responsive results, updating them even just what Deep SEQ did, where it was showing you the reasoning trace, showing you that the model is thinking all of these are UI UX decisions and then a lot of engineering, a lot of custom silicon. Anything that you can do to bake the model down into silicon and just get it back to the user faster, that's gonna, that's for sure going to result in I think lower churn, I think more surprise and delight moments, just more usage, more willingness to pay. Well, before we move on, let me tell you about Vanta Automate compliance and security AI that powers everything from evidence collection and continuous monitoring to security reviews and vendor risk.

Max Zeff, senior writer covering AI at Wired, says in a letter to the White house sent this a.m. this was yesterday. OpenAI encourages the federal government government to invest in or contract with initiatives like OpenAI Stargate to secure computer for public research. The full thing is leverage public private partnerships for supercomputing. We encourage the federal government to co invest or contract with initiatives like OpenAI Stargate to secure dedicated compute for priority public research I.e. health research, national security. Just as government university partnerships built earlier supercomputers, new models could procure capacity on cutting edge AI systems for use by federally funded researchers. For example, a portion of Stargate's COMPUTE might be made available to the National Science foundation or Department of Energy researchers tackling grand challenges providing academia access to frontier models without needing to build duplicate infrastructure. What do you think John? Because obviously people are going to dunk on this super hard but there's people that are are just not interested in AI. Don't think it's important. Don't think.

Show me the big tech company that doesn't want to work with the government. Yeah, like it's a knockout drag out fight to win project maven to win cloud hosting contracts. The government has data right now and the fight between whether that data is stored on aws, Oracle, Google, Azure, like that is a somewhat of a bidding war. But there are also all sorts of sorts of other lobbying efforts to win those contracts. It's the game on the field. I don't know. I feel like this is not asking for a backstop. This is also not asking for nationalization. Although it is like somewhat predicted in 2027. It feels more like an advertisement for a sales product. This feels like an SDR being like I'm ready to rock.

Yeah. And I think even for taxpayers, do you want the government spending like basically taking on the project themselves to build an end to end supercomputer and how good would the actual result be versus just saying like we need compute for these projects.

The real question is like what is the government doing with the supercompute? Because when we talked about the Genesis mission there was a little bit of like, does it go to academic labs? Like, like what is the nature of the supercompute need in the government? There's been a number of like supercomputers built for various scientific projects. None of them have had like such economic value. You know, like the classic example is like the, like working on protein folding, working on, you know, deep space exploration, sort of fundamental physics usually bolted onto.

Like a chat says backstop.

You think they're continuing for the backstop?

Well, I mean in some way, I mean. So okay, backstop gates over. Slightly more critical. Can we reconsider slightly more critical view OpenAI and all their messaging says we're compute constrained and we're compute constrained. If we brought on 10 times the compute, we'd use it in a few weeks. There's all these things that we can't do because we don't have enough compute. And so to also be messaging the government and saying, hey, we'd like you to invest and buy, effectively buy capacity for government researchers from our data centers. Those things are, you can balance them. But it's a little hard too. It's a little bit hard too.

Yeah, it's like, I mean in one way you don't necessarily want another buyer of GPU capacity in the market. Like just from a supply and demand side. If you are trying to buy data center Capacity for your AI lab that's growing, growing, growing, and is truly compute constrained. The last thing you want is someone else being like, I'm also a buyer. You don't want the government being like, I'm also a buyer of compute. You want more supply coming online. So, I mean, if you can ultimately frame this around that it makes sense. But I just think I would be going to the government with completely different things. I would be going to. I would be focused entirely on speed of deployment, unblocking anything that's happening at Stargate. Because when we talk to Doug o', Laughlin, it feels like AWS is really, really good at bringing compute online. We've seen how good XAI is at it. I'm sure that the folks on the other projects are running into minor little hiccups. Whether it's permitting or getting enough energy, or how is the government dealing with impacts of water usage and energy usage and even just the political climate, I feel like I'd be focusing more on that than actually trying to just bring another buyer into the compute race that doesn't fully sit.

Yeah. From this letter to OpenAI writes. OpenAI sees 2026 as the year of AI and science, the moment when AI begins unlocking breakthroughs in scientific discovery just as it sped up software development. In 2025, more than 7 in 10Americans believe we need new innovations and solutions to challenges in scientific and medical research. And they kind of go on kind of setting up, setting up the kind.

Of ask, yeah, I want to know more about what. What are the most exciting science projects that aren't going to happen, Like AI for science, that aren't going to happen inside industry because the Alphafold Nobel Prize is. It feels like a crucible moment for science in that science was effectively successfully done at a private corporation. And if that's the trend, then what is the government's role? What is the university's role? Maybe it should just be a race between Google and OpenAI to actually cure cancer. And obviously the other pharmaceutical companies and all sorts of health companies. Why are you laughing?

I'm laughing because Brandon Jacoby texted me and said listening to the show while working out the sheep sound almost made me drop a dumbbell on my head from laughing. It's a goat sound, Brandon. It's a goat sound. Obviously it's a goat sound. I use that when someone is showing greatest of all time sort of behavior or general excellence.

Well, we are joined by Pranav, who we were supposed to have on the show earlier. We were overbooked we're gonna talk about space data centers. If we're not, you know, maybe the government should buy some of those. We'll see. See, we'll find out. Well, Pranav, welcome to the show. Thanks so much for bearing with us while we had to reschedule you. We appreciate you taking the time to chat with us on the last show of the year, Friday, December 19th. Would you mind kicking us off with a little bit of an introduction on yourself? And then I'd like to go into the project and then we can ask some questions about space data centers, which is the topic of Q4 2025.

Yeah, well, of course. Well, first of all, I want to say thank you so much for having me on here and what a group of handsome young men we have here today. Space data centers.

Well, I mean, you're looking at. Tyler here is the youngest and the most handsome. So he's off camera, but he's here. Look at him, look at him, look at him. Look at our little.

Wow, he still has the Gigachad filter on. That's crazy. It's a little more subtle, but definitely filtered.

Definitely still on.

Yeah.

Space data centers, yes. Fundamentally, if you're betting against space data centers, you're betting against compute to grow. So we're constrained on Earth by land, water and power, and our human minds haven't evolved to understand just how much space there is in space. So as you look at these things, like Google and Microsoft, for example, have hundreds of millions of dollars of GPUs just like, sitting around and collecting dust. And this is, like, probably surprising to some people not in the energy industry, which is my background.

Wait, wait, wait, hold on. So you're saying they have hundreds of millions of dollars of GPUs sitting around because they can't get enough power for them?

Yeah.

Wow.

Okay, continue.

Yeah, and there's so much, like, cost involved in that, right? Like the GPUs might get old and they have to get new GPUs. And there's so much that a lot of these models haven't factored in and even mine hasn't factored in yet. So there has been a little competition, a little model that came out and making.

It's the model wars, the space data center model wars.

I'm making a pretty big update to my model today, and one of my idols is going to share it around and we'll hope that a certain someone gets to see it. Take a wild guess on who that is.

Yes, yes, yes. You were very prolific with your tagging. It was a good strategy.

Oh, there's a few more points. There's a few more things I want to spice up there, but we'll get to that later. So my background is in energy and a lot of people not in energy probably don't know this, but everybody projects the cost to rise and only rise. And as we have more data centers, we run into more constraints with the graph. Like again, land talent, because you need to like put talent and in all these like different places instead of creating these factories and just like shooting them up to space and then power and then water. Right. There's only such a limited amount of that that we can have on Earth and we have so much more ability to do that on space. So if you don't believe that there's going to be like an AI revolution, if you don't believe that compute is going to grow exponentially, you don't believe in like.

Yeah, so I guess part of the debate that's important is I haven't seen anyone that says we will never have large data centers in space or we will never have a lot of compute in space. I feel like the debate has been much more centered around the timeline. Is it a three to four year thing? Is it a 10 to 20 year thing? What is the timeline?

So the timeline, I think, like Elon had a tweet the other day which said doing localized AI inference on the satellites will get them to be the lowest cost way to generate AI bitstreams in under three years. And I was working on independently validating that. And I'll send out the model later today, but I think it can be earlier than that. You can actually like send. You have so much better constraints on space. Like, constraints really ease up on space. A huge part of the energy use in ground is cooling. A huge part of it is like the power. You know, the same solar panel you have on Earth gets so much more utilization in space. So inference, I think inference will be coming on to space very fast, a lot faster than a lot of people think.

Think.

And then another thing you guys talked about is, you know, speed of the models and that models are plateauing and that speed matters. So if people really believe in that. Ground data centers, if you're close to a ground data center, it would be the fastest. But to the 80% of the world that's like not in the US, not in Northern Virginia, not in like DFW. There is a huge need for the latency there.

Yeah, yeah, I like that.

So can you talk about heat dissipation and cooling that Brian in the chat's asking. And I feel like that's been a big question again. That keeps coming up.

Yeah, so there is a huge problem with heat dissipation. That is the constraint that we go up against first. Right. And the reason for that is heating and cooling on ground works very different than cooling in space because space is a vacuum. So on ground you have like fans and stuff and you have convection, so you have mediums to pass this heat through. But in space you don't have that. Right. So you have to do passive cooling and you do that through radiators. And these radiators are like these really big and like really complex systems. And they. There's this thing called Bolton's Law, which basically means like, the higher temperature you can make something, the better it is at dissipating heat. But there's a limit to how high the temperature you can make the radiators in space. And the reason for that is you don't want to get it too high such that you'll melt the GPU. Right. So the.

You want to melt the GPUs with, you know, image requests.

Yeah, yeah, that's what we're hoping for. So, like, the current designs that we have in starlinks are like solar panels on one side and then radiators on the other side. But there's no reason to believe that like, that will be the enduring case. You know, radiators are hard problems to solve, but like, the physics has worked out. It's the engineering, you know, the arcing, like the power electronics, all that kind of stuff that we need to figure out in space. But that's an engineering problem that will definitely be solved. So what we'll see is like these deployable structures which are like radiators that are like folded inside and then they go out in space and then they like fold out and deploy. And those will be like dedicated radiators and like dedicated solar panels. Like, thermal is the biggest constraint, but there is no, no reason at all to believe that it won't be solved.

Okay, walk me through your assumptions around the progress of just getting mass to orbit. I assume that your model, you know, expects starship to be massively successful and scale very quickly. But if, if, if progress in space in the space industry stagnated, essentially, you know, we get stuck with Falcon 9, Falcon Heavy or something. Thing that would be pretty bad for the model, is that right?

Yeah, that would be bad for the model. But that's like another thing, you know, Let me Stoke the flames of the model wars a little bit. Yeah, that's another thing that the other model didn't take into account is these learning rates. Right. Like, it cost $60,000 a kilogram with the space shuttle, and Falcon got it to, like, 1500. And, you know, if we, like, for example, if we modeled that computers were going to say the same level as they did in 1980, we would have like, 100 million times more. Like, they would be 100 million times more expensive than they are today. And I know someone else, Delian, came on the show a little while back, and he talked about how he hasn't seen a compelling argument for data centers in space. I tagged him. I DMed him. We haven't heard a response yet. I'll send out the model, like the updated model.

Oh, you can send him this clip, too, and we'll see what he says. But so. So I actually agree with you. I don't believe in stagnation in. In. In mass to orbit. I do think that starship, although there have been some, you know, minor setbacks, I think it's going to be a massively successful product. I think it's going to grow exponentially, and I think we're going to be able to put a lot of mass in orbit very quickly, especially if we have something good to put in space, like a data center. I'm a believer in that. Now, what I. What I'm interested in is, like, what if we are fundamentally in the really, really good timeline and not only is AI unstagnated and space travel is unstagnated, but what if nuclear fusion and power generation on Earth is unstagnated and we see nuclear power become 10 times cheaper? Does that break the model just on a competitive basis? And it's like, it's amazing. We can get to orbit really cheap, but we can also get really, really cheap energy here. Because all the nuclear folks who I'm sure you've seen come on the show from time to time. Everything that they're doing is working, too. And so energy on Earth is, like, way cheaper than what we thought.

Yeah. So we have a mutual friend, Robin Langtree of Avalanche Fusion.

That's right.

And I was talking to him. He was helping me out. And this is what I'm modeling right now, which is fusion data centers in space.

What?

Wow.

Okay, let's go. Yeah, because, I mean, Sam is an investor in Helion, too, and so you could imagine that he's thinking about energy years and years in advance.

Are you considering volcano data centers? Volcano Active volcanoes, geothermal.

Well, that is space. Like that is land constraint. You know, there's only a limited number of volcanoes, but there's a lot, a lot of space.

How are you thinking about, have you tried to more precisely identify what the launch cost would be of like a single satellite that's capable of inferencing a model for use on Earth? I'm trying to, you know there's new parts, right? Panels, radiators. Yeah, it's, you know, basically the racks themselves. And I feel like that's hard to know exactly, but you can probably just zone in on.

On it.

Yeah, 100%. So if you look at the simulator I made and then you go ahead some years and you can go to the sandbox and change some of the parameters, then you can look at the physics and limits tab and it breaks down the mass per satellite. So it breaks down like the panels, the radios, all the other components that go into the satellite and then it breaks down it down as like a percentage. So you can actually see and visualize like all those components.

Very interesting.

What else has to happen? Like, how are you thinking about understanding the 50, 50 point like me and Jordi were going back on? Is it 1 gigawatt of capacity before 2028? I think that would impress both of us. Would that impress you or is that your base case? Take me through some, like, how you're thinking about the future development of this. I think we're all on the same page that like it's feasible, it's possible. So the interesting question is how fast can it actually ramp? Because there's certain things like, you know, starship just has to, you know, be reliable and they have to build a lot of them. And there's some like rate limiting factors that might just act as like little natural breaks. I mean it's at a certain point if like DSMC runs out of capacity, like, okay, you can't get any more traffic chips. There's all sorts of different shortage points. But how are you thinking about the scale and scope of data center of space? Compute in kind of the medium term.

It'S hard to say medium term. It's like you see somebody, it's hard to predict how their next day will go, but you can predict how their next year will go. And this is a longer scale, so it's hard to predict the next few years. But over the next decades there will be hundreds of gigawatts in space. I am sure of that. And like we will clip this.

You will either look like super genius and Be immediately hired by Elon or you'll be probably already. No, no. There's some middle ground, I guess. One question is.

Sorry, go, go, go for it.

Oh, for some context, there's like 20 like over 2,000 gigawatts sitting in the interconnection queue right now and that's like almost two times the entire US Grid capacity, like just waiting for paperwork. I mean, the biggest threat to AI is really like a guy named Doug at the county permitting office who hasn't been there in three weeks. And space isn't like constrained in that way.

The permitting thing is crazy. I mean, it is much easier to sort of do, do business in space, it seems like.

How do you predict the market will evolve? Do you think anybody can actually compete with SpaceX here? What do you think about Star Cloud? Do you think core weave is eventually like, okay, I guess we gotta go to space now. It's hard enough in Abilene, but I guess you're going to space.

Yeah. So starcloud, I think they're doing really interesting work and I'm really interested in seeing what the results are of their stuff that they're doing right now is because if the results are that these chips that they put out in space without like rad hard, without a lot of like rad hard measures are functional, then we can get there like a lot sooner than even my projections.

Interesting.

And then when you look at. So you said Tesla and core weave. So to go on the core weave point, I think just like the way that space and compute has been like what's called calculated and the cost of compute has been calculated needs a complete overhaul. So someone else did dollars per watts of power, I did dollars per compute. But I think the best way is dollars per GPU hour with sla. So like service level agreements. So a lot of it is just like taking into account the capex or whatever, but it should take into account capex hardware amortization, replacement rate rates, maintenance rates, opex and all these kinds of factors. So you can think of power as like if you're a car factory, power is how much you expect the car, the throughput of steel to be. And then the compute is like how much cars you expect to come and the cost per that. But what the best measure is is the lifetime of a car. Seeing the OPEX of that, the maintenance of that, the gas cost of that over its entire lifetime. Right. And that's the best way to model these things. And I'm going to come out with a white paper about this but this is, like, really important and not enough people are talking about this at all. And on Tesla, yes, it's really hard to imagine how this might look without huge vertical integration, I'll say that.

How are you trying to calculate depreciation rates? This is already a debate on planet Earth. And I could imagine in a different environment you could have, you know, maybe be surprised to the downside, you know, needing to depreciate GPUs faster. Or who knows, maybe there's some, some upside to it.

So part of it is like Moore's Law. So Moore's Law is hitting its physical limits right now in terms of how many transistors you can put on a chip. But there's architecture changes that you can make that can make it better. But I'll actually throw a curveball at you guys. Something that people haven't been talking about. I think the future is not just AI and orbital data centers. It's optical orbital data centers. It's photonics. And photonics are. They're so good at matrix multiplication that's inherent to what they do. And the heating constraint is way lower by 10 to 20 times because you can think about these electrons moving. In electronics, it's like you're pushing a heavy box through a rough floor and it's interacting with all the mediums and causing all this friction and heat. But when you have optical stuff, it's going through wave guides and it doesn't interact with the medium as much. And photonics, it's very, very early. But this will 100% be the future.

So different type of chip. When you say photonics, you don't mean like optical cables between circuits. Satellites physically, like the drones in Ukraine are like, physically wired to each other.

Those are great.

Different chip in space, same constellation as Starlink.

We might need some financial innovation here if we could. If we need a lot of debt to finance these space data centers, if the debt goes bad, maybe we could attach some rocket boosters to it and just blast it out deep into the. Yeah, just put it. Put it on another plant. Yeah, send it. Send it into the sun.

That's actually. We'll see. We'll see.

You're like, I'm working on putting that in.

I'm working on a Tyson sphere, actually. I am going to the sun.

I actually am.

Yeah. Are you really going to build the Dyson sphere model? What it'll take? Are you. Are you over? Are you dyson sphere before 2100 or after 2100?

I like to go by the math first. So I'm still trying to get the math and physics right. But you will definitely know.

But got intuition before or after? Just gut.

I'm an optimist. So let's go before.

Let's go. Let's ring the gong. Let's go.

Well, this was super fun.

This is super fun. Thanks so much for coming on the show.

I. I got a feeling. I got a feeling you're gonna bait the. The Elon repost.

He's gonna come in.

I think it's gonna come in hot.

But no, it's not. The. Yeah, yeah, yeah. The repost. The. The quote tweet. Interesting. The quote tweet. This is true.

Yeah. Or the quote tweet. Thumbs up.

You're getting it any day now.

Anyway, super, super fun conversation. Great to meet you.

We'll talk to you soon.

Excited to see more of your work.

See you on the show.

Thank you so much.

Cheers.

See you guys.

Gemini 3 Pro, Google's most intelligent model yet. State of the art reasoning, next level vibe coding and deep multimodal understanding. We have our next guest already in the Restream waiting room. We have Anna Goldie from Recursive Intelligence. How are you doing, Anna? Welcome to having pleasure to meet you. Welcome to the show.

Thank you. Very excited to be here.

Thanks so much for hopping on. I'd love to start with a little bit of your background. There's a whole bunch of interesting milestones here. Would you mind introducing yourself since it's the first time on the show?

Yeah, sure. Happy to. I guess we could go way back. I studied computer science and linguistics at MIT and I did my PhD at Stanford in like. And actually my first job, I worked at TripAdvisor on the China team. So I did my full stack web development. In Chinese. Yeah.

Wow.

In Chinese. Crazy. May as well start with the easy stuff together. Now.

We can do this segment in Chinese if you want.

I would be lost. Actually. I took one semester of Chinese and I was terrible at. I only knew how to ask. If you want a coffee, I'm going.

To test your Chinese because I don't want you to test my Chinese.

Do you know what that means?

Yeah. You like beer? You really like beer.

Nailed it.

Nailed it.

Yes. Yes. That phrase alone, that can take you anywhere. Anywhere in China. Anywhere in the world potentially. So, yeah. Take me through some of the first interactions with artificial intelligence, AI teams, chip design, any of that. Like, how did you go from. I mean, TripAdvisor? I don't think they've baked it onto an ASIC yet. Maybe in the future. But how did you get into AI?

I guess like the reason I went into computer science is because I wanted to work on AI. Like when I was in high school, I had no idea what I wanted to do when I grew up. And then I heard this lunch lecture at MIT about like computer systems like that could understand and generate human language like in 2004. And then that's why I went to MIT, studied computer science. And that's what I've been working for since then. I joined that professor's lab actually at mit.

Oh, no way.

Very cool.

Systems group.

Yeah, that's great. And then. Yeah. What were you doing right before founding the company?

So I guess I can. Yeah, I joined Google in 2013, Google Research. I was working on like language modeling. And then I joined Google Brain in 2016. I started a team there with Azalia Mir Hossein on machine learning for systems. How can we use AI to design better computer chips and computer systems? Because our reasoning was that chips are the fuel for AI. And so if we could use AI to advance the state of computing, we could kind of close this recursive loop. And we did a variety of projects.

Like Alpha Chip there, foreshadowing the name of the company. I don't know if we want to jump ahead, but take me through the rest of the career.

So yeah, we also worked at Anthropic. I was an early employee there. I had the privilege to joining before ChatGPT and Claude were released. Even so I got to work on RL post training co generation. It was an amazing experience.

How was the team thinking about at that point in time? Pre chatgpt, how were you thinking about custom chip development, how important that would be, be how important that would become, how much flexibility you would need in the chip architecture to kind of advance the research progress before actually committing to a particular pathway.

I guess maybe some background here is that it takes two to three years now to design a chip like a tpu that's very complex. So when you're designing that chip, you kind of have to predict what, what AI models or workloads will be prevalent in two to three years. But we can't really do that because the technology is advancing so quickly. So in practice you're kind of designing chips for current models and you're leaving a ton of performance on the table. Like my team, we ran some experiments where we were designing hypothetical accelerators for particular machine learning models. And you could get almost like a 10x improvement in PER total cost of ownership by doing Even naive customization of the chip with the model and not even being able to change the model.

Is there a little bit of a shoot for the moon, you'll land among the stars effect going on right now? Because I know that there were a number of companies that they did exactly that they tried to predict. Okay. I think that we're going to need a ton of memory directly on the chip for this design or we need to go wafer scale or we need to do something else. And they maybe didn't pan out to be the dominant form factor. But then at least the narrative has been like, oh, those companies are kind of written off and then I'll talk to some lab and they're like, well we actually found an amazing use for that particular thing and we baked this model down. Now we're using a ton of that stuff. And so it feels like these asics like is the correct framing that it is important to get it right and the real you want to land on the moon. But there are sometimes are uses for chips that have been designed with. They didn't quite land exactly where the research direction went, but it's still useful in a niche capability.

Yeah, I think that there are like landings for some of these specialized bets. I would say part of the reason that we're so excited about this company, recursive and short the timeline is I think we can enable many, many more of these bets to really land. Yeah, there's a huge space of chips that could exist and maybe should.

Yeah, yeah. Well that's a good place to jump into the current business. I'd love for you to introduce it formally in terms of how you're framing the opportunity.

Okay. For the company.

Yeah. For recursive.

Yeah, yeah, recursive. So we're AI for chip design and chip design for AI. I guess we see the company in three phases. So I could describe those please.

Great.

So I guess first phase, let's accelerate the chip design process. Let's take the long poles on so physical design, for example, designing the layout of the chip given fixed logic that can take up to a year for a chip like a TPU and then design verification. So basically verifying that the high level specification is correctly implemented in the RTL code, that's also another long pole. So in this phase we can help chip design companies get to market much faster. Maybe it doesn't need to take two to three years. But if you could do it in phase two though we like to go end to end. So given a machine learning model or a set of machine learning models or other workloads. Can we design the computer architecture and design the chip all the way to DDS2 which is a format you've said to TSMC for manufacturing. In that case we could help many more companies design custom chips for their particular workloads.

Maybe on that point, do you know how many customers TSMC has today versus how many you think they'll have in the future?

This is exactly my question. How many custom chips are there?

Do we see it 100xing? 10xing?

Because we really only hear about 3. Most of the time the news headlines are Trainium GPU and Nvidia GPUs. But I imagine that there's a ton more now. Now. But it also feels like you're predicting and your company's sort of a bet on like a Cambrian explosion. Is that roughly correct?

Yeah, that's right. We think that there can. That there are companies that have workloads that they're serving at massive scale. Like this year the AI inference market is $100 billion, but it's like rapidly growing. We think AI is going to be everywhere in embedded devices and also in data centers. And if it didn't take two to three years and if a company didn't need teams of hundreds or thousands of human experts to design their own chips Chips then we can massively expand the market here.

Yeah, I heard an anecdote, I don't remember which company it was, but there was a cloud hosting like a database company that was shifting their database workloads. Not AI workloads, database workloads to GPUs to accelerate them, just to speed them up. And so across the stack, every piece of software there's always an incentive to just push to a more, more like I guess electricity efficient or just more cost effective hardware at some point.

That's right, because electricity or power consumption dominates the cost of running things on chips. I guess that's why I brought it up earlier that we had run some just very initial experiments and you really could get way better power efficiency by using custom hardware. Say DPUs are amazing, but. But they're pretty general purpose. They were developed for graphics processing. So it seems very surprising that they would be the best fit for AI models today.

And I don't think so if you're a database company or any piece of software that then is being transformed by AI and then in the future you might be transformed by custom silicon or custom silicon's in the roadmap and it's maybe getting closer. How much does it cost today to develop custom silicon, a custom chip, work with tsmc and then where do you see that sort of going over the next few years?

I mean it's extremely expensive to design a chip both in terms of like labor.

Thousands of dollars, tens of thousands of dollars.

Way more than that.

To save up for this for weeks. It's like hundreds of millions, right?

Yeah, hundreds of millions.

Okay, That's a lot. Yeah, yeah. I mean certainly not something that even a unicorn software company would maybe not be able to marshal the capital for that just at the drop of a hat especially there's risk involved.

Right, exactly. Also, it's just the timelines here. It's two to three years potentially for a complex chip and you have to build up that in house expertise and there's risk. Like maybe you just won't ever be able to close timing or power and you just can't build the chip.

Yeah.

Somewhat random, but I wanted your take on the Reuters reporting how China built its Manhattan Project to rival the west in AI chips. They allegedly have built some type of EUV prototype. How real is that? I never know if it's hard to know what's real, what's propaganda or what's actually a script scoop.

I, I think I, although I speak Chinese, I don't have any special insights here into whether that news reporting is true or not. Certainly interesting.

Yeah, that's fair.

Well then, then take us through the.

It's a, It's a shame you're not a venture capitalist because if you were, you'd give like a very. Actually I know everything about this.

But how, speaking of venture capital, you raised some venture capital capital. Can you take us through the funding history of the company, what the news is with the most recent round, how it came together?

Yeah, I mean we feel so lucky to be working with a set of investors that we feel like are really aligned with us on the mission. So we raised $35 million led by Sequoia.

There you go. And explain Sequoia for. That's great. How do you. How pleased are you with AI progress this year? You've been in the industry and basically seen it all at this point. Did you think we'd be farther along?

Do you agree with the conception that we're in an age of research, that there will be sort of a plateauing of the current models or maybe more smaller models or more fine tuned models? How are you seeing just the overall model wars playing out?

I guess actually my co founder Azalia had a very interesting report about like the state of models and like the niche that there is for small models. I would recommend you guys checking it out.

Sounds good.

I guess too from my perspective, I feel like there's these tough frontier labs and then there are these open source like model labs and I feel like the frontier labs, they kind of are all neck and neck. I would say like Gemini is has an edge right now because of this kind of co optimization of TP with the Gemini model. So like they're kind of pushing this preto optimal curve of like capability versus cost and I think they have an edge there. But to some extent on the algorithmic side, you know, they all, everyone kind of comes up with the same ideas roughly around the same time and maybe to some extent people talk to each other and there's that part too. Whereas I think that hardware is a real edge here. So I think the labs that have hardware co optimized with their models are going to win in the long term. But maybe I'm biased.

No, I mean that's fair.

I mean otherwise why build the company?

I think it's a fantastic thesis. The vertical integration story at Google makes a ton of sense. You worked on a team, you saw it play out and then you're like, maybe other folks want to do the same thing. I'm going to build a company. It's like the oldest story for why to start a company. It makes a ton of sense. It seems like a lot of work, so we'll let you get back to it. But thank you so much for coming on the show and hanging out with us and explaining all of this.

Well, we'll talk more next year, I'm sure.

Have a great rest of your day. Happy holidays.

Bye.

Profound. Get your brand mentioned in ChatGPT. Reach millions of consumers who use AI to discover new products and brands. Before we bring in our next guest, let me also tell you about Fin AI, the number one AI agent for customer service Automate the most complex customer service queries on every channel. Peter Thiel is in the news again. People are trying to storytell around how he's making so much money off of SpaceX. There's two competing narratives. One is that when he was nice to Elon Musk and then was able to invest, Elon said I was CEO and Peter reported to me so he couldn't fire me. It was a palace coup by most, not all of the exec team and most of the board who were worried about my decisions. This is about the PayPal coup. He says I was the largest shareholder in the company. There was nothing anyone could have done to take my shares away from me. Of course, the PayPal coup has been written about a bunch. Of course time heals all wounds. I'm sure there were a lot of hard feelings at the time, but just continuing to doing business together gets everyone back in the arena once again. But it's not stopping normies from being driven absolutely insane, according to Young Macro. He says we really need to bring back Marvel movies or something. The normies are literally driving themselves insane. And it says, Peter Thiel. How Peter Thiel is Destroying Democracy. The King of America. A 35 minute video essay by Fern, who I believe I've actually met. I don't know, I know some of these video essayists and honestly, great title, great thumbnail. It's gonna get clicks. It has 1.4 million views. But you know, it's a little bit telling the story a little bit too wildly. People are excited.

Yeah, it's funny, we do the red string board kind of ironically, but then people, people out there on the Internet, they're very, very serious about it, drawing connections and spinning yarn.

For sure.

For sure. Everyone. There's only so many stories in history. There's the, you know, there's the love story, the hero's journey, the who's My dad? The revenge quest. And one of the most old, the oldest, most timeless stories that humans tell is who's really in charge? Who does the buck stop with? And everyone wants to know. The Illuminati. Who's the one person who's pulling the strings, who's really given Donald Trump orders. I want to meet that guy. The guy he reports to.

This post is hilarious. Rob Gianni posted if I'm convinced if men in SF started dressing like Jordi, it would instantly become a more tasteful city. And I looked at this.

Yeah, that's a very nice post from Ralph.

Very nice post. Thank you, Ralph. But I was looking at this post. I'm wearing a black T shirt, jeans, and Solomon. I distinctly remember this day. I forgot my normal. I forgot my normal. I forgot sneakers. I was just wearing my gym shoes.

Normally you're head to toe Balenciaga. We don't really show that because we normally wear suits. But whenever Jordy's off mic, it's head to toe Bottega Vendetta. He has the Roman weave shirt with a Roman weave jacket over it and the Roman weave pants and then the Roman weave shoes. And he also has a little beret that's Roman weave leather. He's wearing all leather or entirely supreme he does wear a lot of Supreme. Like, I'm not actually kidding about that. It's a lot of Supreme.

John is kidding. I don't own any supreme, but you do.

I mean, yes, okay, I was joking about the supreme, but it's a lot of Rick Owens. You wear a lot of Rick Owens.

A lot of chrome.

A lot of chrome hearts. The chrome hearts does sneak in it from time to time. You admit it.

Admit it.

Let's just say that no one is worried that Jordy's down to his last 20k.

100%. No one is worried about that because Jordy is rocking the chrome hearts every once in a while. But Kyle Harrison says black T shirt with jeans. Oh, you're sweet. Black T shirt with jeans. Hello. Human resources 100 likes on this. I like this. Yeah, it is just like a normal outfit. But people liked it. Let's see. Brooks Otterlake says, I like it when my posts are treated by the tech and business world as a barometer of normie opinion. That's the way it should be. I'm the everyman. Congrats on being the everyman. I love being what? I guess we reacted. One of the strangest marketing videos I've ever seen. Oh, yes. I mean, I don't know if that's a normie opinion. I think that's actually a fairly online opinion to think about.

Actually analyze the way the video was done.

The strange marketing video. Yeah. Anyway, Brooks, I like both of these takes. I think these are good takes. Turbopuffer, serverless vector and full text search built from first principles on object storage. Fast 10x cheaper and extremely scalable. Anthropic reveal.

This is really good. So yesterday we talked about the Wall Street Journal letting Anthropic run their snack kitchen. It was going wild. It was buying PS5s for people. It was buying live fish. It was giving away everything for free.

I want to read the full report.

Joy really crushed it when when they said they were making all the snacks free. My first thought was coming from Ted. I'm like, what? The snacks weren't free? You were charging in the Wall Street Journal.

That is funny.

These hard working journalists, you're charging them for snacks in the company snack kitchen?

I think so.

We know some of the fine folks over there.

No boondoggles or no free lunches.

There's no such thing as a free snack kitchen. Apparently no such thing. Joe says. Anthropic says. And there was still the occasional blunder. One waggish employee asked if Claudius would make a contract to buy a Large amount of onions in January for a price locked in. Now, the AI was keen until someone pointed out this would fall afoul of the US Onion Futures act of 1958.

Apparently, you can't trade onion futures. It's hilarious. I wonder if prediction markets will solve that. I wonder if you'll be able to do this. And Joe Eisenthal quotes and says anthropic reveals that in one of its experiments, its model was willing to engage in a federal crime. I had no idea about this.

Yeah. So in most places, including the U.S. you cannot trade onion futures.

Don't do it, folks.

Don't even think about it.

Don't even think about it.

In fact, onion futures are one of the. Are the only agricultural commodity in the US that is specifically banned from futures trading.

For good reason. It's so obvious. Everyone understands why. Onion futures trading.

Yes. The great onion scandal of 1955, the reason for this ban is one of the most famous stories in finance history. In the mid-1950s, two traders, Samuel Siegel and Vincent Kosuga, successfully cornered the onion market on the CME. The scheme. They bought up to 98% of all the onions in Chicago.

Absolute dogs.

Absolute dogs. Okay, so they're banning being an absolute dog.

Wow.

Yeah.

They're making it illegal to have that dog in you.

Yeah.

You can't even trade onions with your boys anymore.

Imagine the boys. Group chat. We figured out how to corner the market.

So this came the squeeze. They forced other traders and growers to buy onions from them at inflated prices by threatening to flood the market.

Yes.

That's crazy. The crash. After selling their physical onions, they took massive short positions, betting the price would go down and then dump their entire inventory. Wow. The result was the price of a 50 pound bag of onions plummeted from $2.75 to just 10 cents. At that point, the mesh bags the onions were in were worth more than the onions themselves. And so of course, that created the Onion Futures Act. And outraged farmers started lobbying Congress, leading to the Onion Futures act signed by President Eisenhower. It made trading onion futures illegal in the US to prevent similar manipulation. What do you think it is about onions that makes it so that this is.

Doable?

Doable? There has to be some sort of like.

Yeah, it is interesting that they didn't just ban all futures on all agricultural products, because if you can do this scheme with onions, you would think that you could do this scheme with avocados or with lettuce or with.

See Sancia in the chat. It was a 1950s onion crime. Ring.

Yeah. I have no idea.

Onion ring.

Maybe it's the structure of the market. Like are there a certain amount of onion growers that's different than in other agricultural products? I have no idea why onions would be a unique need, unique regulation. Maybe we should deregulate this thing. Maybe we should rip up the laws. Maybe this could be a single issue voter thing. Maybe we could have a presidential campaign. This is their entire platform they just run on. We're going to make it legal to trade onion futures again. That's the future. What do you think? Well, you know, where you can trade basically everything except for onion futures. Public.com. that's right. Investing for those that take it seriously. They got multi asset investing trusted by millions. And you know they're not going to mess around with any illegal onion futures over the. There they are. By the book, Tyler.

A good bit. A good bit. You could run at one point is just eating an onion like an apple on the show. You should try it. Have you seen the guy on the plane that does that?

Yeah. It's fantastic. Let me tell you about getbazel.com shop over 26,500 luxury watches fully authenticated in house by Bezel's team of experts. I love that. Fade in. And our next guest is Ed Mare from Machina Lab. This is the co founder and CEO.

Look at that background.

Whoa.

That is remarkable.

Did you see Blake's demo a couple weeks ago?

I gotta go bigger.

I gotta outdo him.

This looks fantastic. Introduce yourself. Explain what we're looking at.

Edmir, welcome to a shop floor. Yeah, no, I definitely had to upstage Blake. So this is a two 40 foot, actually 20 foot containers that can manufacture anything. We call them Robocraft Craftsman. It's a robotic system that basically manufactures any kind of metal product. We call it robocraftsman because it can pick up different tools like a craftsman and do all kinds of parts. Right now he's actually manufacturing a drone. It's a drone skin. So that what you see over there is a metal sheet. It's a 2 millimeter aluminum sheet. The robots are actually deforming it into a shape of a drone which we're going to see in a little bit the complete product. Just using kind of the way the potter forms clay. Like there are two robots on two sides. We're going to show you to the other side of the cell.

Wow.

Pinching it, deforming it into shape into complex shape. That can be defense products, auto products, all kinds of metal products.

This is amazing. How Many of these machines do you have? How many parts are you making? Update us on the scale of the business. Where are you today? Where are you going?

Yeah, right. Right now we're in our second facility. We have two facilities here in Los Angeles and Chasm. We're close, so you guys should come for a visit at some point. This is, as you can see, serial number 15 is this one. We're right now working on serial number 18 and 19. So at least 17, 18 of them right now to the state. Two of them outside of our facilities. The rest are here in our facility. We are a right now a series C company. Right. Actually we're going to make an announcement about that soon. So we should talk about that. Yeah. And yeah, so you know, we work with Department of War with outer space Primes, recently announced a partnership with Toyota on making something that wasn't traditionally even possible in automotive world.

Wow.

So we're going to show some of that parts in a bit. But yeah, no, the company's an exciting place. We're thinking about our third facility outside of California. So lots of good stuff.

Yeah, yeah, take us through that. There's the partnership with, with the Strategic development Fund. How did you meet them? What's the plan? Walk us through the deal.

So we have like a unique approach toward manufacturing, Right. You know, with defense, a lot of people are thinking about kind of going back to what it was in 1960s and 1950s centralized manufacturing plants. They can do a lot of stuff. Our approach is different. We have these systems. If you go back, these systems are two containers, right? So actually they fold like a container into a container, like a transformer and can be shipped anywhere. Right. They open up on any shop floor and they can basically self calibrate themselves and start manufacturing. So our approach to defense manufacturing is distributed, right. Not one giant factory that can make a lot of things. A portable system that can go anywhere, open up, calibrate, make any types of parts. That's how we got connected to the folks in uae, Middle east, obviously, very unstable environment and they're looking in a lot of different defense products. So their choice is either go to China or manufacture it locally. They are looking at solutions like us to set up a facility that can be brought up in matter of weeks, not years and you can start making defense articles. Because tomorrow if you go into conflict in Middle east or in the Pacific, you cannot manufacture everything in the United States. How can we get the help of allies? Let's say if you're in conflict in Pacific, how can we get Help from Philippines, South Korea, Japan to set up a facility. Matter of two months to start making USVs UAVs as opposed to making a central location and shipping them.

We talked to a couple folks that have different ways to make parts from additive subtractive manufacturing. We talked to 3D printing metal, 3D printing companies. How are you thinking about positioning the product as flexible for R and D use cases? The, you know, you want to, you want to do a few small runs, very niche versus actually scaling up to something like, okay, we're making the shell of a cybertruck that's obviously stamped. That's, that's a very different requirement. When you're talking about tens of thousands, hundreds of thousands of a particular shape of metal, how are you managing that transition?

I think you want to think about kind of manufacturing in two different paradigms. There is a traditional paradigm when you have an assembly line, you make the same thing over and over again. And what we're thinking is actually closer to how data centers operates, right? You have these systems that actually end up becoming pretty cheap, right? We are making these things to become very much commoditized hardware, off the shelf hardware so they can easy to finance. But the way you get throughput out of these is that you replicate them horizontally. You set up a facility that can have 50 to 100 of these and manufacture in parallel, as opposed to one assembly line that makes the same thing over and over again. In our next facility, we're deploying 50 of these.

Right.

And that allows us to get like, you know, defense articles up to a few thousand a year, right. Obviously not a good fit for making like a million of the same, you know, Toyota Tacoma. But when we're talking about few thousands, which is all aerospace, you know, all defense, all heavy equipment and machinery, this is a good choice, right? But yes, you want to go to, you know, millions of parts a year, then we might want to start thinking about the traditional paradigm. But that's also something that we are actually exploring with Toyota now because we can combine this paradigm with traditional manufacturing to get the benefits of both. Right? So this is actually a door of a, you know, a F150.

And we.

What, what happened is that you can actually stamp the general shape of the door, right? But then you can customize, in this case, put the LA Dodgers logo on the door so that this door is uniquely kind of designed for the customer. We're doing this for Toyota right now. So this is a topological map of LA that has been formed on top of a hood for A forerunner. So this is something a lot of people in the off road world care about, putting these topological maps. We actually showed this in a show that we did with Toyota a while back in SEMA in Vegas. That's an aftermarket show. And then here's an example of something we did with the tail gates. So you can combine the stamping, you get a lot of throughput and then at the end of that line it goes on our machines and then customize it.

So that's super cool.

Oh, that makes a ton of sense.

Sounds like manufacturers have responded positively to this. The workflow would be a customer goes and specs out a car and then there's like a personalization feature at the end where they have some other designs that they can imprint it on on that they can imprint on to make it.

It's like engraving but way better and way more complex and way more unique. And so you're going to be able.

To put a, you could put a gong on the hood of a Ford gt, John.

Yeah, yeah, yeah. That's exactly what I want actually.

Exactly, exactly. And this is actually like, you can go beyond just like cosmetic stuff. You can start putting functional because the shape of the hood is not never going to really change the bulk shape of it. But you know, from model to model you start having more, more features, more little designs in there that you can kind of modify with our technology. And it only takes a few minutes. Right. So you get the throughput as well. But speaking of gong, I think we also formed a gong for you guys in the morning. Look at this.

No way.

We just finished it now.

No way, no way.

So we're going to do a little.

Hitting of a gong for you guys.

Amazing.

Wow. Wow.

This is a moment we've been waiting for. What a way to cap.

Thank you so much.

That is insane.

Well, congratulations on all the massive progress. Is there anything else you'd like to share? Are you hiring? What's the, anything else that we haven't touched on that might be worth mentioning?

Yeah, no, we're growing. In the next two years we're going to go from 70, 80 people that we are right now to 240, 250 people. New location in another state. So anybody who's excited about manufacturing, reshoring, helping out allies have distributed manufacturing, we're looking for them. And yeah, now we have exciting announcement in, in January as well. So stay tuned.

We're looking forward, looking forward to having you back on that. And feel free to, feel free to come by in person if you can.

Yeah, yeah, that'd be great for the announcement.

Oh, that was great.

That's incredible. Well, congrats to the whole team on a crazy year that seeing it all in, in real life here is incredible.

Yeah, it's wild.

Awesome. Thanks, guys.

Awesome.

Have a great one. Goodbye. 8sleep.com Exceptional sleep without exception. Fall asleep faster, sleep deeper and wake up energized. Charlamagne signed a five year deal, $200 million extension with iHeartMedia, locking him in with the company after it struck a deal with Netflix to stream the Breakfast Club.

Interesting.

Forbes is writing a story here.

Iheartmedia is paying Charlamagne 200.

This is say hey iheartmedia. We have a deal with Netflix. We can't lose Charlemagne because the Breakfast Club has already been sold to Netflix. We gotta have Charlemagne hosted because he's the talent. That's what's going on there, I believe.

Very cool.

The article in Forbes is called How Charlemagne became a Media God. I love it because of course, he's Charlemagne the God. On a chilly night in November, radio personality Charlemagne, the God is Roman through the aisles of Midtown Comics in New York City, captivated by the heroes and villains that shaped his childhood escapism. At the highest level, he says, everybody's here for a purpose. Dressed in a black pea coat, a white hoodie, black jeans, and tan Timberland boots, this isn't the media vigilante that listeners of the Breakfast Club have come to expect over the past 15 years. The 47 year old comic book nerd leafing through original graphic novels of Batman, Superman, Wolverine, and one of his favorites, Luke Cage is more subdued and introspective as he considers his public and private Personas. So congratulations to Charlemagne. I think we gotta ring the gong for him. That's fantastic news.

Great stuff, great stuff.

This. This Santa suit is falling apart. I'm gonna have to take it off at some point. I'm sure you're itching to get out of that and reveal the entire head to toe supreme outfit that you are wearing underneath the chrome hearts. The chrome hearts. Anyway, wander.com, book and wander with inspiring views, hotel grade amenities, dreamy beds, top tier cleaning and 247 concierge service. It's a vacation home, but better. There's a robot that is solving Rubik's cubes in 0.1 seconds. That is so fast. Look at this, look at this. You can't even. Oh, it's in the slow mo cam. Okay, watch this. And it's off. That's so crazy.

That's Insane.

Think about that look. This is a super, super slow mo view. Super slow mo view. Super, super duper slow point. Wow, it's doing. This is so fast. Wow, it's really doing it. I can do a Rubik's Cube in around one minute. Can you do one? How fast can you do it? Let's cut to Tyler.

My best ever. When I was like 12. It was like 20 seconds.

20 seconds?

Yeah.

You were a speedcuber. Nerd alert.

Nerd alert.

Nerd alert.

The no look. Is that really.

Yeah. Oh, yeah.

He's got it.

He's got it. He's got it.

I used to be dialed.

I used to be much better. Yeah. That is fantastic. Well, you're out of a job because robots can do the Rubik's cube now in 0.1 seconds. Takes you 20. Takes me a minute. Takes Jordi an hour. The robot's gonna kill us all because it can do it in 0.1 seconds. If your job was doing Rubik's Cubes, find another job because you're done.

You're cooked.

You're cooked.

You're chopped and you're cooked.

Yes. Well, Ramp is throwing a funeral for the penny in Washington D.C. this Saturday. And you should go check it out. There's a partiful link if you're in Washington D.C. head on down to the in Ramp we trust. Funeral for the penny. This is how. You want to hear something funny? This is how I learned that the Penny is being retired.

Yeah.

This is news to me. That news didn't break through until Ramp was throwing a party. I'm not kidding about that. This is how I learned. And actually the guy who's working on this, Rohan told me in person. I was like, oh, okay, so the penny's going away. Thank you for the service, Ramp for telling everyone that the pennies going away. We needed to know. We needed to know. We also needed to know about AdQuick.com out of home advertising made easy and measurable plan buy and measure out of home with precision. Did you want to talk about watches, Jordi?

I did. I did not know that Osama bin Laden was a Casio guy.

A Casio guy.

Also apparently based on couldn't get the RM base has a watch as well.

Watch drop is cool. I like a watch drop.

We like a watch drop.

We did a watch drop for Excel. We did a watch drop for Excel.

Remember, they're still floating out there.

A lot of people received the briefcase. We did a one off drop for this nicotine pouch sub brand nicotine Pouches for finance Bros. Effectively, a pouch designed to increase shareholder value. We call it XL nicotine pouches. And in there we had some products. We had a briefcase with a logo on. A silver briefcase. And in. And we had a big tin. And a lot of people didn't realize that if you opened it up inside.

Was a custom watch and more tin.

And more tins in there? Oh, maybe.

Yeah, Yeah.

I think there were six. There were six tins around the outside. And then you opened it up and you got the watch and there was the briefcase and there were a few other things that we prototyped out. But it was like the first drop that we worked on. It inspired more drops. But this is a great drop. A watch is a great drop.

Bill Ackman strikes $2.1 billion deal for insurer in bid to build the modern Berkshire Hathaway has anybody bid to bill the bid to build the modern Berkshire Hathaway and come out unscathed?

I don't know. The answer would be Apollo, actually.

Well, yeah, no, I'm not saying. I'm not saying sure is a bad strategy. I'm just saying I don't know that Apollo said, we're building.

This is cursor for X again. I'm doing Berkshire Hathaway for 2025. And maybe you need a different path, but Bill Ackman's a great investor. He probably knows something if he's willing to part with 2.1 billion for an insurer. Let's see what else is in the timeline before we head out.

This is interesting. Apparently there's opportunities. Mike Lee is saying, would you like to seize cartel assets as a privateer?

This is a big opportunity for Phil.

If Bill would allow the president to issue you 11 of mark time to take these pirates down. We did talk about.

Did we create this?

We did say at the beginning of the year we were highlighting the reward for Maduro.

Yes.

Very early.

Yes.

Before. Before this whole Venezuela saga really kicked off.

It definitely ramped up from the time we talked about the fact that the state department was interested in bringing him in for questioning. What a wild year for Nicolas Maduro. Anyway, Matthew Zeitlin says the fog. And he's posting a screenshot of a push notification from the New York Times which asks the question, where did the sun go? An unrelenting fog has parked in the Central valley for weeks. Here's where it was. Here's when it will finally loosen its grip. The fog.

There's a lot of conspiracy theorists, the fog that really.

Do they think Augustus is Responsible about the great Fog. Oh, really? I know the Fog had a Twitter account for a while. There was a guy who was posting as if he was the Fog, because the fog is very.

Did you see this game unrecord?

No.

It's a body cam, first person shooter.

Wait a minute. If we pull this up, I believe I have seen this. Remarkable. Also not. I believe this is not AI generated video. This is just incredible Unreal Engine footage. This looks so real. I don't believe. It's crazy, but I think this is actually real. Now, I believe I thought this game went into beta and I thought people were playing this. And I believe that even though it's remarkably realistic, looks so real. It's like you look at that and you're like, oh, this looks like the best game ever. This looks way better than Call of Duty. In fact, the modern gamer. And really, you or me, you don't actually want this level of realism because it makes the game really hard. It makes the game a lot less fun, like some people do. Certainly some people want Milsims, but a lot of people actually do just want Fortnite. They want great mechanics and then they're willing to suspend belief and say, hey, we're, you know, I'm gonna play something that's a little cartoony. As long as the mechanics work.

Yeah. I just think it's. From the developer standpoint, it's smart as counter positioning. When you think of the modern Fortnite, Call of Duty.

Oh, totally.

Uav, you've got crosshairs, you've got drummer boys, drummer boys.

You've got reindeer, you've got Santa. Sly unrecorded. If anyone has played this game, please drop a review in the the chat. I would love to know if it is actually good. Apparently they got funding from Tencent and it is going into full production. So this was a little trailer that they put together. And this might have been rendered out in Unreal Engine, but at a higher level of fidelity. Maybe they did post processing. There is a variety of things that you can do, but it is remarkable. Really quickly, I feel like there is a massive opportunity to bake one of these generative AI models that just does the transformations. You remember we talked to that AI video company where the founder came on and transformed his image. That was Descartes. So the founder of Deck Hart came on the show and live in his webcam, was using Genai to turn the background in his face into like a wizard's lair.

Right.

Think about how powerful Genai would be if it ran at 120 frames per second, 60 frames a second. And its whole goal was just to take Call of Duty and turn it into this level of fidelity or a little bit higher or something really, really photo real. That level of. I mean, Nvidia graphics cards already have DLSS, Deep Learning Super Sampling, which takes a 1080p video game and up ress it to 4K. And it's trained. It's beautiful. You have all the training data because you can just run the game in 4K, run it in 720p, and then just design the algorithm that just matches the two together. So it's like super easy. It's not some unbounded AI problem. And so I'm very interested in when Nvidia. Maybe Nvidia does it, maybe the PlayStation 5 does it, maybe some gaming company does it. But they say, hey, our game is running in unreal engine at 720p and it looks like Roblox under the hood. But you turn this switch on and you're playing something that looks like this. That seems like a really interesting opportunity to be. Anyway, sorry, we can move on.

Call of Duty is headed towards Fortnite and these games never rip. It's really just Unreal Engine marketing.

Yeah, yeah. It seems like it's very hard to get this across the finish line, get this out into the world.

Meanwhile, back to more important things, including software as a service. Christina, the CEO COO over at linear, says, someone asked me what good back channeling looks like and I personally thought that this was a good phrasing. When Dylan Field interviewed Christina, he said, I've talked to people you've worked with and heard your intents. Christina says, that opened up a real conversation about what they likely meant when that. When that intensity shows up and how I think about it myself.

Very.

Yeah, just kind of a good framework to like kick off a conversation and not kind of dance around like, you know, not dance around the back channeling and just be super direct and actually start a conversation around it.

Yeah, yeah, yeah. Oh, we have to do this story, but it's really late. We can't go into it. But we actually talked about this because we saw this guy as LA's richest man. He went from billions to busts because of Global Crossing. We talked about this because his house hit the Mansion section. Well, the Wall Street Journal has a fantastic deep dive on his career and life and we will have to go through it at some point in time.

JIRA Tickets was reacting to OpenAI now aiming to raise 100 billion at an $830 billion valuation. And JT says, wow, new number. Just dropped. Congrats on the new number. Looks like it's bigger than the old number. That's good. Can't wait to see the next number. I love the number business.

That's really true.

Good bit, I guess, reality, this reality is life is a number business. It's all about just make it go up forever. This is a good way to, I would say, wrap the year.

This might be the post of the year.

Shrek hits a timeline to say some important words. Check yourself before you Shrek yourself.

You were just laughing about. You were just laughing, laughing to yourself before the show. And I asked you what were you reading? And you said, well, Shrek said, check yourself before you Shrek yourself. It's fantastic. Well, it's been a fantastic year, everyone. Thank you so much for all the support. Thank you for watching TVPN and engaging with us in all different ways. We really appreciate you and hope you have a fantastic holiday season. Merry Christmas. Happy New Year. We will be back on, I believe, January, January 4th, the first Monday of the new year, maybe 5th, 5th. And so in the meantime, leave us five stars on Apple Podcasts or Spotify if you haven't, and we will see you in 2026.

I can't believe. I can't believe this is the last show of the year.

Last show of the year.

What a year.

Wow.

Thank you, everyone. Totally surreal.

Surreal.

And it's an honor, an honor to build this show with the team and with all of you in the audience.

Gabe says one last gong.

One last gong. One last gong for 2025. What a year. You pull up your pants, he's got sweats on underneath. Don't worry. One last gong.

Very Christmas. Happy New Year. Merry Christmas. And we will see you in 2026 here, folks.

We love you.

Goodbye.

Have a fantastic New Year's and all those holidays.

Goodbye.

Enjoy. Merry Christmas.