OpenAI's New CEO of Applications Shares Optimistic Memo, Stargate Hits Early Struggles, P&G Pays Unilever $10M in Spying Case | Anatoly Yakovenko, Aaron Levie, Neil Parikh & Daniel Cahn, Jan Sramek, Nathaniel Manning, Chris Andrew

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Massive post from Fiji Simo, the CEO of Applications at OpenAI. She is outlining what her plan is basically and it's very, very interesting post. So in so Fiji Simo is an absolute boardroom general give me the Ashton hall when Fiji Simo Yes. VGC Mo OpenAI and Spotify board of Directors positions. Huge runs at ebay, Facebook and Instacart. Now she's the CEO of Applications at OpenAI. Today she outlined how she sees OpenAI's products having the biggest impacts. High level six things knowledge retrieval, health, creative expression, economic freedom, time and support. And those are kind of getting, I think more abstract, more vague as they go along. But it's interesting. They map pretty closely to my experience. Knowledge retrieval. I use it as a Google replacement for a lot of things. I use deep research as a, as a knowledge retrieval product. I also use it a little bit as web replacement. Not a ton, but I've seen a lot of people use that. But I do ask it for advice around health, fitness, recommendations for supplements, all sorts of different stuff. Often I'll just go there and say what is. What type of creatine does Andrew Huberman recommend?

It'll just or complex medical.

Fortunately I haven't been in one of the situations recently, but I if I did one of those situations I would definitely go to it.

It is interesting because previously when people were trying to understand maybe a small health issue they're having, they would go do a Google search, add Reddit to it, and then they would look through the comments and the comments would provide kind of like context on the symptoms or whatever they were dealing with. But you and you could technically leave a comment, but I think the majority of people wouldn't want to post about that. So the fact that OpenAI has all that Reddit data, you can get that same type of data but then you can kind of ask a number of follow up questions, which is very cool, very powerful. I'm certain that people are probably misusing it, maybe reading too much into the results. But again the idea, I think for long time doctors that would say don't look on Google, you're just going to stress yourself out and then you go into the appointment room and they're over there on the equivalent of Dr. Google.

Totally. It's nothing new. People used to go to WebMD and the meme was like, you go to WebMD and no matter what you type in, it says, like, could be cancer. Like, could be like the worst possible thing, but it might just be a cold and maybe you should just take some Advil. But, like, for whatever reason, WebMD felt the need to, like, kind of give you the full picture and all the possibilities. And then they'd of course say, like, go consult an expert or talk to your doctor. So. But yes, I definitely see it replacing that type of health experience. Also, I'm using it as a Photoshop replacement a fair amount of time if I need to just quickly generate an image, quickly generate something that I would have normally gone to a 3D rendering program or Photoshop and kind of created a collage to kind of heal.

A huge tailwind for the Meme Industrial complex.

Huge tailwind. Still a lot to work out there. I do find that sometimes when I go to images and chatgpt, I'm going back and forth on the prompt for 10 minutes and I'm like, I could have just done this with traditional tools. So it's not perfect, but when it gets it, it's so amazing. And the final product often looks a lot more cohesive than what I would get if I was like, collaging and like, the shadows didn't match and they were like rough edges and stuff. So certainly great there. The last three are a bit more vague. We'll have to read into those. But OpenAI is set up to win pretty big in all of these categories. So semi analysis clocks chat GPT's share of queries. It's 71%. Meta is in second at 12%. And that's with billions of users on Meta products. And so OpenAI is certainly running away with consumer. So there's this question of like, it feels like the rest of consumer AI plays will be, I would say, like horizontal in the sense that it won't be a new app on your home screen. Meta won't have meta AI as a.

Home screen app loses their lead and becomes the Yahoo of AI. But that doesn't feel likely.

Yeah, it feels tough. Like, why did Yahoo lose to Google? It's because there was an entirely new paradigm in PageRank. New algorithm emerged. Sure, if that, if that happens from SSI or Super Intelligence, Meta superintelligence, like, there could be a leapfrog moment, but so far they've been pretty good at staying near the frontier to the point where it's like, okay, Google got them on this one, or Grok got him on this one today, but there hasn't been a time when I've been like, okay, like, there is a dramatic difference in the results, such that it's worth it for me to go over. There was that moment for Claude for a little bit. Everyone's like, claude's way better. I went over and use cloud for a bit, and then I went back to OpenAI just because the product was better and had more of an ecosystem.

Product lead is very real.

Yeah, I was. I was thinking about this, like, if. If you played out a hypothetical scenario and you went and you had, you know, the keys to OpenAI HQ, you went and you exfiltrated all the code, everything got an app into the App Store, Jordy GPT, you have the exact same model, the exact same inference, the exact same ui, everything. Could you win? Because people would say, well, it's not better, so I'm not gonna switch.

We live on a part of the Internet where people are constantly debating the merits of the leadership teams and the approaches and the philosophies. But then downstream, you have approaching a billion users that are just like, yeah, I like the product. I use it a lot.

Yeah. And so even if you ran a Super bowl ad saying, like, we have a product that's exactly as good as ChatGPT, it is feature for feature parody, they would be like, but I already have it installed. You're asking me for two minutes to uninstall this and reinstall the new one, and then I don't get any benefit. I wouldn't do it. Even if you match my. Even if you match my capabilities, you got a leapfrog.

It's funny. So Jason Freed had a great post relevant yesterday. He said, feature parody is just another way to say we don't need to exist. So if you come out and you're so good at what you do that you can create as good of a product as OpenAI models that are as good, you still don't need to exist. And so that is the challenge for anyone competing.

If you let me tell you about ramp.com time is money save. Both easy to use, corporate cards, bill payments, accounting, and a whole lot more all in one place. Go to ramp.com really quickly. So it feels like the rest of consumer AI plays will be horizontal. There won't be a new AI app for Meta that really takes off. Instead, AI will improve everything Meta does across Facebook, Instagram, WhatsApp, Quest, et cetera. And I was thinking about the initial takeoff of Facebook. The other tech companies, they didn't really seriously get to compete in social networking like Google+ never really took off, I guess Microsoft bought LinkedIn and that's kind of a niche social network. Very profitable business, great business, but it is like its own thing. It doesn't directly compete, but graph databases and the idea of storing efficiently connections in graph networks like Facebook kind of pioneered that, became really widespread and was used all over the place. And the same thing with Google Search like this, this page rank, just better search algorithms, those wound up manifesting in better search in all sorts of products. And so when, when a new company comes out and builds, you know, a whole paradigm or they break through in terms of front end development or database development or some sort of structure, like it winds up, it winds up improving everyone. And so I think, I think AI will have these like horizontal benefits all over the ecosystem. And I think it makes a ton of sense that Meta is investing so much in superintelligence, but it's not. I don't really think the narrative should be like they need to play catch up to ChatGPT. I think it's more like they just need to implement LLMs in every single crack in all of their different systems like they do with great databases, great infrastructure. I'm not sure we'll see.

I still think there's. I still think there's. I mean remember Meta made some early experiments of making digital clones of big celebrities on Instagram. I still think they'll take more shots on goal around companionship. Will they go grok waifu mode? No, I don't think they want that revenue line. But there's a bunch of other ways in which they could kind of go after that market that I don't even think. I mean ChatGPT is such an interesting product because it's designed to be a functional tool around knowledge retrieval, creative expression, just unlocking consumer surplus, giving people access to expertise, et cetera. And the way in which people are using it as a companion is sort of not the sort of default. It's not like you name your chatgpt, right? People will give it a name.

Yeah, it doesn't really stick. It's certainly not baked into the UI in the way that it could be. Yeah, I know people do talk to.

And so again, I've said it before, but as ChatGPT, user hours are just, or sorry, user minutes still. But as they're ticking up, I do think Zuck will look at that and say, I want some of that action.

Yeah, yeah, and maybe some of that, but I still think some of that happens inside of the platforms. I don't.

Yeah, not necessarily a net new app.

It would be very difficult and Meta has yet to really do it. WhatsApp and acquisition, Instagram and acquisition but stories massively successful within Instagram and so I would expect. I agree with your take that I think there's an opportunity for a lot of AI stuff to live within those apps. And then also just on the monetization side, they're in a very unique space where they can give great products away for free, but they can't be charged an inference cost to another company. And so if they have their own open source model, they can inference very cheaply, they can give it away for free and then they leverage their massive ad network. So let's go through what, what Fiji simo over at OpenAI is building. So a few. In a few weeks I'll be joining OpenAI as CEO of Applications. We've all been waiting for this moment, helping to get OpenAI's technology into the hands of more people around the world. I've always considered myself a pragmatic technologist, someone who loves technology not just for its own sake, but for the direct impact it can have on people's lives. That's what makes this job exciting, since I believe AI will unlock more opportunities for more people than any other technology in history. If we get this right, AI can give everyone more power. And so she has a fantastic career. EBay, Facebook, then Instacart and is now at OpenAI.

And she was heavily involved in building the ads engine at instacart, correct?

Yeah, yeah. And obviously Facebook as well. So on knowledge, she says empowerment starts with understanding the world around us and our place in it. When we have the right knowledge at the right time, we can make better decisions, advocate for ourselves and change our path. But for most of history, access to expert level knowledge has been limited to those with more resources. I mean, even, even after the invention of the printing press, like you still had to be in a big city that had a library to go check out a book for free, still had to have the time to do it and, and certainly buying every book and being able to index it was very expensive and difficult. Now it's even easier. It's already working. People who use AI tutors learn twice as much as they do from human ones, and the gains are even bigger compared to learning in a traditional classroom. In a 2024 OpenAI study, 90% of users said ChatGPT helped them understand complex ideas more easily. I agree with that on health, she says, personally, I'm most Excited about the breakthroughs that AI will generate in health care. A few years ago, I faced a complex and poorly understood chronic illness on its end. And it became painfully clear just how fragmented and inaccessible the healthcare system can be. Even with access from some of the best doctors in the world, I found myself acting as a connector, piecing together insights from multiple specialists who weren't speaking to each other. I actually had a friend who got a very, very rare form of cancer and did all of the research pre ChatGPT, actually downloaded all the frontier science and all the different papers, figured out that it was this one very rare condition found. The expert went to that expert, he was like, yep, you have this thing. I'm the only one that studies this thing. I'm gonna help you. Did the surgery, saved your life. Crazy.

I had an issue. I was 18, traveling. I was surfing in South America. There was flash flooding. I was in this tiny town. I got a antibiotic resistant staph infection from that.

Oh, that's bad.

And then was getting repeated infections over the next year. And the doctor kept prescribing antibiotics, antibiotics that were so, I mean, such an intense antibiotic that doctors won't. It's like a soap. They won't touch it without gloves on and they use it before surgeries. And they just said, use this twice a day over your entire body. And I kept having issues and eventually found in a Reddit community that was like, just like obsessed over this issue. And the thing that fixed it was avoiding gluten. It like actually just fixed everything.

That's so crazy.

And I just imagine if I was like, even now, if I was dealing with that issue, I would have been able to. I would have just been able to like, talk with ChatGPT about it. They would be able to surface all that kind of thing, build it, build a picture of it.

So very interesting. Well, let me tell you about Restream 1 livestream 30 plus destinations, multi stream and reach your audience wherever they are.

We use the backbone of this show.

So she closes out health, saying AI can explain lab results, decode medical jargon, offer second opinions, and help patients understand their options in plain language. It won't replace doctors, but it can finally level the playing field for patients, putting them in the driver's seat of their own care. Very excited for that. And also that feels like something, I don't know, like, yeah, just like, I don't know, it'll be interesting to see if that manifests itself in like, all of this is like, will there be any fracturing in the actual product. Because right now all the fracturing that's happening in the chatbot product is in like, what model you're using. You're using agent or deep Research. But so far, all the different products, yeah, they're all chats, and none of them say, this one's for health, this one. And I'm in like a safe health territory. It's like, that's all driven by the prompt. I would imagine that over the long term, everything's driven by the prompt. I would love to be able to go to ChatGPT and just say, hey, quickly, what's the population of Canada? And it knows to use 4.0 for that. And then if I say, hey, I want you to give me a full report on the history of Canada, give me a deep research report. I wouldn't need to select it. It would just know from the prompt.

You go to chatgpt, agent, help me annex Canada.

And then it just goes and starts. Yeah, don't mistake. And then it just keeps working. So the third one, she says, creative expression. I believe we're all born creators and that the ability to imagine something and make it real is a big part of what makes us human. The problem is that our ability to express that creativity is often limited by our skill sets. Completely agree. I can't draw at all. Not everyone has the resources, time or training to paint, write, compose or build. When I imagine the future, it often comes to me in images I paint in my spare time. But the ooh, we gotta find some Fiji Sema originals, but I'll hang them on the wall. This is interesting lore, but the images in my head are much more realistic and complex than what I am able to paint today. Now, AI is collapsing the distance between imagination and execution. With AI and image generation, I can prompt and iterate until the output matches the complexity and realism of the vision in my head. Unless it's a Where's Waldo. We gotta solve the Where's Waldo challenge.

We do.

It's coming for sure. The Where's Waldo eval for image generation. Today, nearly one in three Gen Z users say AI tools have helped them express themselves in ways they never could. So this is another fun viral, obvious, valuable. Like we know it. We love it. Everyone's using ChatGPT for creative expression.

Well, yeah.

And this presents a massive challenge. If you are a Chat gb, a GPT rapper that's trying to go compete in the creative expression space because you have to. It's not enough to generate a cool image or generate a meme it used to be that if you could do text well, that was maybe an advantage that people would use your product. But ChatGPT image generation has just gotten better and better and better. It's fantastic. If you haven't played around with it much, drop your group chat the profile pictures of your most popular group chat, put them in there and say make them all gigachads and then you can share bodybuilders. Yeah, for sure.

Well, you start with generating an image in ChatGPT. Then when you're ready to go pro, you move over to Figma. Figma.com Think bigger, build faster Figma helps design and development teams build great products together. You can get started for free@figma.com Fourth, she says economic freedom when people can independently create and capture value, they gain power over their own economic destiny. But starting a company isn't easy. The average cost to start a small business in the US is around $30,000, an impossible threshold for most aspiring entrepreneurs. And until recently, building a product or launching a service required technical knowledge, especially coding. That was a problem for hundreds of millions of people who had ideas for tools, apps, platforms, etc. That could have made an impact, but didn't. They didn't have the technical skills to bring them to life. The classic ideas guy I just need a programmer to build it for me. Well now you can vibe code it. AI now gives the people the power to turn ideas into income, no matter their age, credentials or zip code. A single person can now brainstorm, prototype, market and launch a product with tools they control themselves. A 2024 Shopify report showed AI enabled solopreneurs launched businesses 74 faster than peers without a tool. Without AI tools. I've seen it with my 9 year old daughter who decided one day she wanted to be a party planner for kids birthdays.

Let's give it up for it's amazing.

What a great story. In one weekend using AI tools, she created a fully functional website showcasing her party ideas, shared it with her peers, and started taking on clients. Amazingly, my husband and I didn't have to help her, but we did have to intervene before the confetti cannons were ordered.

Ben, good reminder. We should get some confetti cannons.

We do need.

Except. Except last time when we had confetti cannons at YC Demo day. Yes, my eyes were in pain and days and days. We need goggles next. Yeah, it was. There was so much dust in the confetti cannon.

We left it all in the field.

We did.

In the future, people will be able to build new Things without waiting for permission, capital or credentials. This will, of course, will mean a meaningful shift in the workforce. Companies will hire fewer people, so you get more smaller companies. That seems pretty cool.

Yeah. My first real company, skateboard company, jman Designs, probably. I don't know if I would have done it if my. My lovely mother wasn't a graphic designer and I needed a logo to print on the decks that I was getting made. And I just would sit with her and tell her, you know, do this, do that, do this, do that. And yeah, it's pretty cool that you can now just talk through that process in natural language. And. Yeah, how many more people can.

It was pretty crazy. You ran a skateboard company without doing proper SOC 2 compliance.

I know.

You should have got on Vanta Automate Compliance, Manage risk, prove trust continuously. Vanta's trust management platform takes the manual work out of your security compliance process.

Huge alpha starting. Starting an extreme sports company and saying, look, none of our competitors are serious enough about this to get serious, to really take compliance and security as seriously as you should.

Yeah, I mean, I do think for kids especially, I mean, the ability to just use AI tools fully to go and solve problems, and it's almost like your town's McKinsey consultant. I remember I had an early job of just like scanning photos for someone. They needed a whole bunch of photos scanned. It was like pretty manual labor, but, like, I actually wasn't that good at it. I kind of messed it up. It was like too much. Like the scanner wasn't configured properly. So a lot of. I had to redo a lot of them. It was a learning process, but it's probably the first.

One of the first small jobs I had. The only thing that's maybe boring and repetitive that I can imagine you doing is the bench press. Basically the same every time, but. But yeah, those type of tasks I've always struggled with. But I don't know that we're at a point. I still think if you were using. I think that job still exists.

I think it does. I think there are bigger companies where you can just like send in a ton of stuff and they'll just professionally scan it for you. But they're pretty expensive, I think. So I think the kids still have some alpha. If your opportunity cost is low enough, kids are fifth. She says time regaining control over your time is one of the most liberating, empowering shifts a person can experience. The ability to control how you spend your time is often what separates people who feel in charge of their lives from People who feel overwhelmed by them. Wealthy people who have always bought back their time by hiring personal assistants, household staff, private tutors, chefs and more, building full infrastructures to reduce friction in their lives. Meanwhile, the average household spends nearly 20 hours a week on domestic work, logistics and errands. While leading Instacart, I saw firsthand how technology can shift perceptions and behaviors around time. In 2012, the idea of paying someone to shop for your groceries felt like a luxury, something reserved for the ultra wealthy. But with the right product design, logistics and pricing, we made it accessible and indispensable for everyday families. Today, the Instacart user base mirrors the US population with millions of families getting hours back each week to spend on higher value activities.

The question is, will OpenAI build a gig worker network where when your agent runs into a wall and needs somebody in the real world to accomplish a task, will you be able to delegate? Tasks like that feels like a stretch, but I don't know. They could plug into the Uber network or any of these other networks.

Yeah, maybe they'll, I mean they already have like an Instacart integration, so maybe they will, they will rely on other gig work platforms to solve those problems and actually handle that side and they will stay in the full like the.

Package, package delivery where you can get an Uber to just pick something up and take it across town.

Yep.

You could imagine that, that being integrated.

Yeah, I mean there's, there's a host of, of, of, you know, services and companies and APIs for shipping, mailing, moving things around, hiring someone. I mean in theory you could, you could hire a personal chef and be communicating your agent could be emailing with them and say hey, you know, be here at this time. There's this party here's and it's kind of, you know, it doesn't need to be, it doesn't even, you don't even maybe need a gig work platform because the agent can go out and, and scroll Instagram in theory and find someone who's advertising that service or Google it and find a listing of local people providing that, that, that, that job and, and, and go and retain their services directly. Interesting. I believe AI will allow for a similar shift in many areas of life. Time consuming activities like researching decisions, planning vacations, scheduling a tutor and more can be done by an AI agent that anyone can access. As we build new products, we have a chance to make these time saving capabilities feel not only useful, but routine. In doing so, we can empower people to regain control of their time and attention. And I Certainly feel that something that I would need to sit down 15 minutes looking for, you know, a new studio space or something. Fire off agent and come back with some interesting results. Anyway, let me tell you about graphite.dev code review for the age of AI. Graphite helps teams on GitHub ship higher quality software faster. Get started for free graphite dev. Last one, Support. For many people, the biggest barriers to progress aren't lack of access or opportunity, but self doubt, isolation and burnout. Sometimes what's most empowering is support someone or something that can help us reflect, feel seen or simply move forward with clarity and confidence. My business coach Katya has been transformative in my career. I've joked with her over the years that everyone needs a Katia in their pocket. Personalized coaching has obviously been a privilege reserved for a few, but now with ChatGPT it can be available to many. This is something I have not used. This feels like we're getting further out on the curve of like, you know, defining what the product is like. Knowledge retrieval is like so concrete, generate an image, very concrete. Now support is much more, it's much more of an amorphous product and there's some companies out there that are doing it right now. It's not a drop in replacement and there's much more to define about what this product looks like or how people actually use this.

Yeah, it's very general. There's going to be vertical, specific companionship products. Right, We've seen this. What's the founder that we had on the replica? The original one started like a decade ago. Grok Heavy 4 has their own specific iteration. But then this is also to be clear the area of greatest concern, right where it's very clear if you have a business coach telling you, John, you got this, you're incredible, you're probably good, you're built different, that's great. But then when you tell them that you've discovered, you know, how to break the, you know, space time continuum and they tell you to do that, you're actually right.

Hill Road right now, you're right, you're good.

You're absolutely right. You can't figure this out. And so I think they need to figure out the guardrails for this category and I'm sure that's top of mind for everybody at the company right now.

Yeah, sure. AI coaches on the other hand can be available throughout every day. She says this isn't about replacing human connection, but filling a gap that often goes unfulfilled. Many people don't feel Comfortable opening up to family or friends. And most people don't have access to a therapist or coach they can call regularly. Even people who do have access often spend an hour a week or less with these professionals. At the core, at the core of philosophy and religion is the idea of self knowledge. To become who we want to be, we have to understand who we are. So very interesting. Anyway, let me tell you about Linear. Linear App Linear is a purpose built tool for planning and building products. Meet the system for modern software development, streamline issues, projects and product roadmaps.

It is what OpenAI uses to build their products.

That's true. So yeah, I think it's interesting to see how useful is it to have these six ideas in mind because in many ways like ChatGPT, the magic of it is that it's just a blank text box and you can do anything with it and then these properties emerge like the. Yeah, I mean like Google over time had to figure out okay, there are people that are searching for products, let's, let's surface them. The Google shopping experience. And that is a specific UI that is triggered by when you search for a certain product. If you ask for you know, like best headphones over the ear under $200, like it will just put you in a different product more or less instead of just the 10 blue links. Same thing for if you're asking for a movie, it will pull up the pictures of this cast and the year and show you the Wikipedia page and like or news, it'll take you to the news portal. And I'm wondering like how much of this will actually bifurcate into different trees with different rules and different features. Because for something like support, I don't know that if I'm having a conversation with a coach about a strategy that I want it to wait 15 minutes to get back to me. That might be something I wanted to do separately. But then if it's health and I'm uploading my health records or some documents, I'm like really, really, really don't hallucinate. So like take as much time as possible. Again, that's something that right now I would decide as the user. But I'm wondering if this buy for.

Well, yeah, obviously OpenAI ChatGPT as a business, when anybody wants to do anything, they want people to go there.

Right?

When you want companionship, you want to talk with somebody about something, you go there when you want to. They do the book a flight demo that's overplayed, but they want to own that. When somebody's shopping they want to own that. When somebody's trying to diagnose a medical issue, they're trying to own that. So I just look at this article, this essay, whatever you want to call it, as a way for people internally at OpenAI to sort themselves into what area. These are all different verticals that I can imagine people working on. I want to go to ChatGPT and work on health or giving people their time back.

I was listening to Ben Thompson talk about the flight booking agent demo and he was like, I have a personal assistant. I book my own flights. And I think that's very, very common where it's like, I'm. He's so specific about what he wants that he's fine to just do it. And it doesn't take that much time. And so I do wonder.

I have a flight booking AGI.

Yeah, in your brain.

First name ramp, last name travel.

That's true, yeah. I mean, still, it's. When I use that, it's like I'm in control. It just does all. It harnesses everything to bring all the data together.

Yeah. The interesting thing is I've had EAs over the years. I've had remote EAs, I've had EAs that are embodied, real people that are absolute killers. And I find that the Internet already makes it so easy to do so many things that some of the greatest value that you can get from an EA is just having somebody in your city that can help you with a variety of different things. And so I think no matter how good ChatGPT agent gets, there's still.

I.

Mean, there's just still so much that I think people expect out of an ea.

Yeah, yeah, it's very, it's very particular. Like people have all sorts of preferences and I don't know, it might be more sticky. Who knows? We'll see. It'll certainly continue to be a good evaluation. Well, I want to just look at what's, what is. You know, it feels like OpenAI has a really strong lead in consumer. The product. They're thinking about the applications and actually like the, the, the manifestation of like these six different categories. Polymarket has OpenAI climbing now in which company has the best AI model. At the end of 2025, the December 31st rankings, OpenAI is up to 29%. Just a week ago or so, July 18th 12th, XAI was crossing, about to beat them, but Google's still in the lead. 48% chance that Google winds up with the best model.

But that doesn't necessarily mean, I mean, this is based On Ala Marina.

Exactly.

It's not necessarily the most valuable model to users, it's who's dominating benchmarks.

Yeah, I actually pulled up some interesting like the mo. So do you know how there are movies that are loved by critics but disliked by audiences? So the classic example is Star wars the Last Jedi, 91% on the Tomatometer, but audiences gave it a 41% score. And then Dave Chappelle's comedy special had the opposite, where the critics hated it, but the fans loved it. And so these things are like controversial. And I was wondering if the same thing exists in foundation models and it does. So Gemini 2.5 Pro has. Which one is this? Gemini 2.5 Pro has an MMLU score of 86% and it's the top ranked model on LMChatBot Arena 03. So if you summarize these. Let's see. Kimik2 illustrates how a model can excel in benchmarks and still be less preferred by users. Possible reasons include limited availability. Similarly, Claude Opus 4 and GPT 4.5 have high MMLU scores, yet rank lower in human preference because they may focus on careful reasoning rather than conversational ease. So you can think about it like you don't necessarily always want to be talking to someone who's like the most rigorous or like it's almost like they're too smart maybe. And then Gemini 2.4, 2.5 Pro 03 and Gemini 2.5 flash show the opposite pattern. Users love them despite modest MMLU scores. So these models have long we need.

To get Tyler to go to a random place in America and do a man on the street interviews and just ask people about different models. I bet you 99% of respondents probably, probably, probably like 990 out of a thousand are going to tell you I just go to chatgpt chat.com and I just, I just open a new chat.

Yeah, what is. There's multiple models. Yeah, totally. But, but it's interesting that like if you want to win with people. Gemini 2.5 Pro O3 these models have long context windows, so they're staying focused a little bit longer if you're having a conversation. Multimodal features, the images and audio, just a better user experience. You can talk to it in different ways. Faster latency, more personable style makes them more enjoyable even if they don't top academic tests. Your people are happy with it. So I thought that was an interesting little, little anecdote. So anyway, let me tell you about numeral hq.com sales tax on autopilot spend less than 5 minutes per month on sales tax AGI. Another news. You had a post today from the Wall Street Journal.

This was wild. This stood out to me. We were commuting into the studio this morning and this stood out. So OpenAI has committed. The Journal reported that OpenAI is committed to paying Oracle for $30 billion per year within three years for four and a half gigawatts of data center capacity, which will be the equivalent of two Hoover dams worth of energy. So good time to be if, if you happen to build a Hoover Dam mega project, you know, years and years ago. Yeah, this would be a good time.

If you're squatting on a Hoover Dam. Yeah, you could get 15 billion a year from that.

Well, it's obviously not, not maybe the entirety of costs, but yeah, it's wild to think OpenAI's latest run rate.

Right.

They're reporting somewhere around $10 billion run rate or they want to end there by the end of the year. And so they're expecting to be able to have $30 billion worth of. And that's just with this partnership with Oracle.

Yeah, there was. So Tane, who's been on the show, says ChatGPT is a truly iconic product. Consumer engagement at scale over 500 million weekly active users, an estimated 7 billion ARR. And it looks like an annual chart and it's a monthly chart. So August 2024 they're at a 2.6 billion estimated consumer ARR. Then in September they're at a 3.3. December they're at a 4 billion ARR. Then they're accelerating. February they're at 5.6 billion. March they're at 7.2 billion. And of course we're all the way in July now. So they could potentially already be at 10 billion ARR. And so if you just chart this out, 30 billion in a few years doesn't seem that crazy. And we were talking about like, how bad is that? How painful is that to pay a $30 billion bill? But it is kind of the only cost is like to serve the models. And so I don't know, it feels like it could work out. I don't know.

I mean, it's certainly not the only cost. I mean, especially if you look at stock based comp.

Yeah, you're spending more than that.

Won't stop 119% of revenue on stock based comp over the last year. So very, very significant. But this is what betting on yourself looks like. Commit, you know, if you want to level up in life, commit to, you know, $30 billion of fixed costs three years from now. You got to make it work. So for sure.

So this, this all comes from a Wall Street Journal report saying that OpenAI's Project Stargate is struggling, which is an interesting term. We can kind of debate what constitutes a struggle. So for some context here, all the hyperscalers are generally in the high tens of billions in terms of Capex. So Google, Microsoft, Amazon, AWS, they're all in like the 60, 70, $80 billion range. But the majority of that is on core AI or core data center build out. So traditional data center build out because they still need to serve just relational databases. Not everything is cutting edge Nvidia chips serving Transformer based language models.

Ghibli's.

Ghibli's, yeah. Not all of it's Ghiblis, but a lot of it is. And Mark Zuckerberg recently said that, you know, about half of the spend maybe going forward, something like that is going towards gen AI versus core AI. So he builds out a big AI data center. A lot of that's going to just serving reels, picking what ads to show you. All of that is AI as well, but it's not in this generative AI, not training these large models. So the majority of that spend is not on generative AI focused data centers. So but there's still big, big numbers you can think about.

All the duck has his own Manhattan Project. Yes, that's basically what, yes. What if you, if you show that your new data center is going to be the size of Manhattan. Yes, that's one way of saying I am doing a Manhattan Project for AI.

And that, and that, that like you know, the size of Manhattan. That particular data center, he's targeting five gigawatts, which is right here at four and a half gigawatts in three years. And, and when, and when Mark Zuckerberg was Talking about that 5 gigawatt data center, he was saying this will be in a couple years. Right now they're focused on the 1 GW data center. And when we talked to the CEO, the co founder of Core Weave, he was saying like you don't understand how big 5 gigawatts is. Like that's insane. It's such a big, it's such a big data center. Like this is a huge project. These are mega projects. And so when I hear like, oh, it's struggling like a couple months in, I'm kind of like, you know, we're building something so big, like did we ever expect there not to be a hiccup I'm not, I'm not ready to say, like, oh, this is all doom and gloom. It seems like, you know, they shot so big with 500 billion.

So, so, yeah. So one got to give regardless of what someone thinks about Sam. Right. He's got plenty of critics, but, but the fact that he was able to finesse his way to getting the President to announce this project with Masa with a number so large that people immediately just started looking at SoftBank's balance sheet and saying, okay, cool, how is this happening? Elon quickly fired in the comments saying, they don't have the money. It was always unclear where the money was going to come from. But one of those things, you shoot for 500 billion, you land at 100 billion, you're still doing pretty well.

Yeah. And it feels like it's more about the corporate structure and the timing because if you go to Google, Microsoft or Amazon and you say, we're so in on AI, we're going to invest $500 billion over the next 10 years, like all of a sudden it's like, okay, yeah, well you're on track to do that. That totally maths out. So the question was always in my mind, okay, $500 billion is the goal, but what is the time frame? And that's the one that people are pulling on right now because the immediate number was 100 billion. They said, we're going to do 100 billion right now. That was in January when Trump, Masa, Sam Altman and Larry Ellison were at the White House. They announced Stargate. They say we're targeting 500 billion, but we're doing 100 billion immediately. Now that's maybe been scaled back, but it's still so huge. Like SoftBank's putting 30 billion in OpenAI and then OpenAI is paying Oracle 30 billion per year starting within three years. So struggles is a little out of a characterization. Yeah.

So Oracle's projecting over 25 billion for 2020 in 2026. Capex, everybody's just throwing money in the pot.

Yeah. And I mean it makes sense.

And what's happening right now is the definition of Stargate is just being expanded. Sure, sure, sure. They're counting the Oracle, this sort of commitment that they're making to Oracle as part of it.

And so I think there are two questions. One is like the super intelligence AGI pilled, like we gotta build the next greatest thing. And whoever builds that at 10x the scale, whoever gets to the $50 billion, $500 billion data center, they just train and then they Win because they'll have a product that's so much better than everything else that everyone will shift over and chatgpt will be obsolete. The, the flip side is that if we're in a little bit of an S curve, if we're in a little bit of a plateau, well, then in order to hold on to that 71% market share, ChatGPT just needs to keep, just keep delivering inference tokens reliably at a level that doesn't cause churn. And so when, when, if I go to ChatGPT and I'm getting a ton of errors and I just cannot get my prompts done and like, my Ghibli's aren't working, I'm going to open up the Gemini app and I'm going to go over there and see if they have any inference tokens. And we're hearing this from the model routing companies that a lot of businesses that rely on LLMs and AI inference are seeing brownouts, intelligent brownouts in different models at different times. And so they need to be able to reroute from.

Yeah, somebody was looking at anthropics uptime, and it's just constantly down, like there's so much demand and they're, they're obviously doing everything in their power to deliver against it. Yeah, but they, they, they don't have enough GPUs yet.

And so that feels like everyone's got to build bigger data centers. Maybe there is a point where we build too big, but everything looks like, okay, it's at least worth building the 1 GW data centers. Probably worth building the 5 GW data centers. We might need some more research breakthroughs to justify the bigger data centers, the 10 gigawatt, the, I don't know, 20, 50 gigawatt, something crazy. But in general, I think the main goal for OpenAI right now is just to continue serving inference at a level that avoids churn. So when someone shows up, get them the answer. I think new products like Agent are cool, but it takes months for people to really adopt these new tools en masse and seriously change inference demand. We saw this like, like Agent went out Thursday, we talked to the team, and then over the weekend I was talking to people and smart people in tech were not using it yet. And I kind of had to like, step up and be like, it's my job to test this thing. And now I'm using it. And now I would say I'm probably a weekly active user of Agent. I'm definitely a DAU of 4.0 I'm a DAU of O3 Pro. I'm probably even a DAU of Deep Research, but I'm not a DAU of Agent yet. But that will come. But I'm clearly on the early adopter side or it will be a while until they're doing so much agent, so many agent workloads that they're really right.

Now it just default takes 15 minutes.

So deep research takes 15 minutes almost every time.

That's how ChatGPT agent always.

No, it can be shorter, it can be longer. That's part of the beauty of it, is that it sizes the inference relative to the task. And so it can spend a really long time, it can come back to you, it can interact with you. Although I haven't actually gotten a push notification. Maybe that's just because of the nature of my prompts, but I haven't had to step in, which has been surprising because when we talked to Dan Shipper from every, he said that he did have to interact, but I think what he was prompting was a little bit more robust than what I was asking for.

So, yeah, what he's doing that I think will get a lot of adoption but a bit slower is these sort of like batched tasks that I think are really interesting. But that is extremely expert mode for now.

So that's the story in the Wall Street Journal.

Should we flip over, maybe cover this?

Number one AI agent for customer service, number one performance benchmarks, number one in competitive Bake Offs, number one in ranking on G2. What did you want to flip over to?

I was going to say maybe we cover this XAI story quickly.

Yeah, yeah, totally.

And then we have actually Tyler, our very own Tyler, over, and Michael are at the Tesla diner. So we'll move over to them and get a view.

So. So Sam Altman, Larry Ellison, Trump, in some ways, Masa are all working to build Stargate simultaneously. Elon Musk is trying to ramp up things at Xai. He's aiming to raise up to $12 billion for Xai chips as the startup burns through cash. And so just weeks after Musk's XAI raised 10 billion through sales of stock and debt, the startup is working with a trusted financier to secure up to 12 billion more for its ambitious expansion plans. Valor Equity Partners. Antonio Gracias is in talks to lead with lenders to raise the capital. The money would be used to buy a massive supply of advanced Nvidia chips. And so the number was kind of all over the place. I saw a million chips floated that would Be much bigger.

Elon Elon shared this morning, 230,000 GPUs, including 30,000 GB2 hundreds are operational for training Grok XAI in a single super cluster called Colossus 1. And at Colossus 2, the first batch of 550,000 GB2 hundreds and GB3 hundreds, also for training, start going online in a few weeks.

Yeah, so if you compare that to what the other clusters are, Prometheus from meta is around 500,000 chips. Stargate's supposed to be around 400,000 and I believe Anthropic's in that range too. And so it's a knockout drag out fight. Everyone's trying to build a massive cluster, do the next big training run. And XAI has been moving extremely quickly. 122 days for Xai to build its first giant data center in Memphis, Tennessee. Colossus. It originally housed 100,000 Nvidia GPUs. It was among the world's largest clusters. Just 92 days later, Xai doubled Colossus's size to 200,000 GPUs. And now he's going even bigger. So good luck to everyone.

Pulling in capital from everywhere. SpaceX had to get into the round. Quite the party round.

Yep, it's all over the place. 5 billion in corporate debt included. Bonds in loans secured by data centers, which makes sense if you're building something capex intensive, you would use debt for that. Anyway, in other news, I wanted to talk about customer relationship Magic ADEO is the AI native CRM that builds scales and grows your company the next level. Get started for free. No, I want to talk about Procter and Gamble and the idea of this Michelin tires question that we have been toying with.

Been toying with, to be clear, since the original deal and rippling debacle since the timeline was in turmoil.

Yes.

Our reaction was that on a long enough time horizon, people will not care that a payroll provider may have gotten a little too competitive in the past. And the comp that we discussed was if you went to your mother or a family member and said, hey, I saw you're driving, you know, using Bridgestone tires. Did you know that the CEO of Bridgestone was actually, you know, spying on Michelin, she would say, that's very sweet, honey. I'll keep that in mind when I, when I replace my tires in two years and then probably forget about it immediately.

And it also relates to the astronomer story where the CEO was caught having an affair at a Coldplay concert. That is something that people were saying he has to go. It reflects poorly on the company. But if you look at, you know, Apache airflow management, are you going to rip out Astronomer over this? Especially when they replace the CEO so quickly. And so this question of, like, what is existential? What puts you in the FTX category or the Theranos category versus a company that can come back and rebuild from what is controversial? So there's this old story from 2001, this is in the New York Times, and I think Fortune broke the story, so I'll kind of give you the high level. So late on a spring afternoon In April of 2001, a red flag memo landed on the desk of Procter and Gamble Chairman John Pepper in Cincinnati. Internal security investigators had discovered that a handful of employees working with an outside outfit of ex US intelligence officers, I guess like CIA guys, had been rifling through rubbish bins outside Unilever's offices and posing as market analysts to extract secrets about for coming forthcoming shampoo launches. The COVID snooping, management learned, had been going on for months under the radar of P and GS famously buttoned down compliance system. The operation, codenamed the Ranch by the company's competitive intelligence unit, first took shape in late 2000 when P& G hired Alabama based Phoenix Consulting Group, a firm led by Vietnam era clandestine veterans. So, like CIA guys in Vietnam come back from the war, they're probably like 50 at this point. And they're like, yeah, let's do some.

Not done yet.

Corporate espionage as a service. So by the time the plot was exposed, the operatives had spirited away roughly 80 internal Unilever documents. So the rival consumer packaged goods company, marketing calendars, packaging mockups, even margin analyses, along with samples lifted straight from the trash document. So they're literally digging through the trash. And if you think.

It's so funny to think why this was necessary.

Oh, it's incredibly valuable. So if you know someone's marketing calendar, you know that they're gonna launch this product on Tuesday, you can launch a competitive product on Monday. Steal all the wind from that. You can, you can, you can launch a counter position product. There's so much that you can do.

Yeah, I know, but.

And margin analysis is really key because if I know that you're selling a product at low margin and I can undercut you, then you're backed into a corner. You can't lower your margin without losing money on that, as opposed to if you have a high margin product. I might not want to attack that. There's a whole bunch of different things that you can do if you have good competitive intelligence and even packaging mock ups like understanding that, okay, they're going with a bigger size, they're going to be on this shelf in Walmart. We should go and try and lock up Walmart overpay to block them out of that slot. Like, there's a lot that you can do with this stuff. So Pepper, who is the chairman of Procter and Gamble at the time, his immediate instinct was containment by candor. He dismissed three staffers, seized the files and telephoned the Unilever co chairman, Neil Fitzgerald to confess. Within days, P and G couriers arrived at Unilever Chicago headquarters with bankers, boxes of paperwork and a pledge that no one who had seen the material would touch hair care strategy. Again, this was an unfortunate incident, Pepper would later say, and we are ensuring the information has not been and will never be used. That might have been the end of it until Fortune magazine landed the scoop on August 30, 2001, under the headline PG's Dirty Little Secret. The story, which read like corporate like a corporate John le Carre novel. Who of course does Tinker Taylor, Soldier Spy and a bunch of other great spy novels you should definitely read. Detailed dumpster dives, safe houses and fake business cards and triggered a global media pile on. Within a week, the Los Angeles Times, the Guardian and newspapers from Dublin to Delhi were splashing shampoo spy puns across their business pages, facing a reputational firestorm on the eve of the crucial back to school selling season. I didn't know that that was that big for P and G, but I guess it is.

You buy going back to school new.

Shampoo, so I guess you need new soap. The two consumer goods goods giants struck a confidential settlement announced six September 7, 2001 published reports, but the payment at about $10 million. More painful for P and G, Unilever secured an independent monitor empowered to audit new product timetables and the reassignment of any P and G employee tainted by the files. This agreement ensures our confidential information is protected, unilever US Chief Charles Strauss told reporters pointedly. Regulators never filed criminal charges. Dumpster diving on public property skirts US theft stats statutes. But the incident singed PNG's carefully cultivated Midwestern morals brand. The company rolled out mandatory ethics and competitive intelligence training worldwide while industry groups tightened codes. Now that flat out now that flat out ban Klaston that now flat out ban clandestine trash raids and pretext phone calls. Competitive intelligence textbooks and MBA ethics course is still open their corporate ethics espionage chapters with the PNG Unilever saga as the moment when lawful information gathering fell headfirst into the dumpster of public opinion.

I mean, this probably created a bull market in paper shredding for sure. Right?

Yeah, yeah, you don't want. You don't want people diving into your dumpster. We got to shred all of our materials when we're.

All of our.

All of our bags, all of our printed posts. Can't find these anywhere on the Internet. More than two decades later, both Pantene and Suave remain grocery aisle staples. Proof that the scandal left no lasting dent in shampoo sales. What endured is the cautionary tale. The world's dullest products can tempt even the bluest chip companies into spy novel theatrics. And that in the age old war for market share, the most corrosive thing you can pour over a brand isn't a rival's conditioner, but the acid of public embarrassment. Very fun.

Wild story. Well, we should jump over to Tyler, who is at the Tesla diner. Here he is looking sharp on the ground.

Hear me?

How you doing? Yeah, we can hear you.

Okay, sweet. Yeah, I'm here at the Tesla diner.

I'm on the roof.

We couldn't get food. The line was like extremely long. But up here on the roof you can see it's kind of like a retro futurist, like very Americana style diner. You know, they have burgers, fries. I think there's apple pie. But here I can walk around.

Yeah, yeah, sure.

We heard it's farm to table too. Is that true? They're partnering with local farms?

It's unclear. I would have to ask some of the cooks here. But you can see that these two massive screens they have. Let's see if you guys see this. They're playing what looks like, I don't know, reality show or something. There's like these massive. I think there's 80 superchargers. Can you guys see this?

Okay, yeah. Are they full? People are charging their cars.

I think they're almost awful.

Yeah.

Okay, so I think the way it works is you can order from your car if you have a Tesla. If you don't have a Tesla, then you gotta wait in the line. It's like 45 minutes long, probably. Okay, you can see. Let's see if I can find a box. The burgers come in these little cybertruck boxes. Let's see if I can pick it up.

Oh, wow. Very cute.

Yeah.

And then if I walk over here.

Did you just pick up a random stranger's box, by the way?

Do you Know that person?

Julia.

Oh, that's Julia. Hey, Julia, how you doing?

If I walk over here, there's actually an optimus robot serving popcorn.

Okay, let's see.

Let's see here if I can walk over.

Oh, wow. Yeah, There you go. Any indication if this is tele operated or end to end?

It's unclear, but there is someone standing right next to it.

Okay.

I think Jerry.

Yeah.

But yeah, overall it's very cool. Right on Sunset Boulevard.

Yeah.

Okay, Tyler, we're gonna give you.

The food is good, but we're gonna.

Give you a ramp bump on your, on your card. We're gonna make it so that you guys can start going, offering 10x the retail price of the burger. We gotta get. We got. You guys have to try a burger.

Burger.

You can't leave without a burger. So go around and just offer, start offering people. Start bidding on people's burgers right at their tables. Just say you got that for $10. I'll give you 100 right now. And figure out a way to get a burger. You can't leave without a, without a taste test.

No, you should. Yeah, you should wait in line and talk to people and actually try the food. Give us your review at the end of the show.

Okay.

Yeah, that'd be great.

I'll try to find someone.

Awesome.

Awesome.

Thanks for checking in.

Very cool. Do you think this is a meaningful business line or a marketing stunt?

Great marketing activation. I think that I can see them putting these in tier one cities. I mean, the charging stations are interesting, right? Gas station convenience stores are great, great businesses because you have this captive audience and people that are charging their cars typically have to hang out for quite a bit longer than somebody that's filling up gas for a few minutes. So I can see them having a handful of these or even developing their own kind of convenience store concept over time.

Yeah, it kind of harkens back to when the soap companies Unilever png, going back, started the soap operas to like promote soap. And it's kind of like this adjacent business that actually could grow into something. But there's a big question about, like, should this also be on the Tesla team's plate to manage and grow a chain of restaurants? It's like a lot of stuff to do, but it is a very, very cool, like, view into the future. It's a, it's a, it's a showcase. It feels like the world's fair. That's what it feels like. Yeah, it feels like going to a world's Fair. Very cool.

Well, well, we have Tolle in the Restream waiting room. Let's bring him in. Very excited for this conversation. There he is.

How you doing?

Welcome.

Good to meet you.

You are live.

How you doing? Can you hear us?

No sound yet.

Let's, let's ping him. Hopefully bring him in from the Restream waiting room. In the meantime, let me tell you about adquick.com out of home advertising made easy and measurable. Say goodbye to the headaches of out of home advertising. Only Ad Quick combines technology, out of home expertise and data to enable efficient seamless ad buying across the globe. And if we are ready we will go back. We're working on it.

One sec.

Anatoly from Solana. Get the full story. I'm obsessed with the story of Solana. I made a whole YouTube video about it. Fantastic founder story. Really deeply technical. I don't know, it's just a fascinating story and he's been at it for a very long time, so very excited to talk to him about it.

And he made the careers of a lot of different venture investors for sure. For sure.

Yeah. And just fascinating trade offs and how you design. I mean pretty, I don't know, it just feels like, like such a massive challenge to start now. One after Bitcoin Ethereum are out there and you're like I'm going to do the hardest thing in the world probably and then I'm going to make it through some of the most tumultuous markets ever and kind of be at peak awareness right during the interest rate rise and massive sell off in crypto. Stuck with it, kept building and is here today to tell us more about the story of Solana. So hopefully we can bring him in. We'll see. Okay, in the meantime we should talk to you about MKBHD. Did you hear this story? MKBHD in 2020 he had a video that he put on YouTube exposing this fake phone Escobar fold. You saw this? I, I saw this video when it went out. So it turned out some guy was scamming people by sending phones to influencers, but not to buyers. So basically what he would do is he would buy a Samsung phone, give it a wrap, basically rebrand it and then he would sell it and send it to, to influencers. So if you bought on the website he would look you up and say, okay, you're an influencer, you're going to review, I'm going to send you the actual product. But then anyone else he would just be like, oh, you're on the backlog, you're delayed. So in February or in June of 2020, just three months after Marques Brownlee launched that video, the FBI came to his studio and collected his phone as evidence. So MKBHD keeps all the phones that he reviews and they say, hey, we'll give it back to you. And then five years later, that guy who was scamming people pleaded guilty to fraud. He faces millions of dollars in fines and 20 years in federal prison. So what a crazy story.

Wonder how many of these citizen journalism did they figure out how many of these fake phones he actually sold?

I don't know. I mean, I imagine if it's millions in fines, he probably sold millions of dollars worth of phones. It was a very expensive phone because it was wrapped in gold foil. And so it was marked up, I believe, pretty heavily. Or maybe the strategy was to underprice it.

The CEO said they sold over 50,000 telephones.

Anyway, let me tell you about public.com investing. For those who take it seriously. They got multi asset investing, industry leading yields and they're trusted by millions. Go to public.com to get started.

So just to put this into context, that means they did potentially 17. Over 17 million in sales of a phone that was never delivered.

Yes. Yeah, pretty.

And this was, this was Pablo Escobar's brother, I believe.

He was like riding on the Escobar name and kind of a distant relative, which is a funny brand to align with because it's like, trust me, I'm related to a criminal. And he.

Objectively is one of the greatest CPG entrepreneurs of all time. Right. Bootstrapped to tens of billions of revenue.

Yeah.

Global empire.

Yeah.

Just chose a product that happened to not be very legal.

Yeah. Very rough. Mert from Helios, friend of the show, says in eight hours Solana blocks will become 20 bigger. Put differently, you can now do more transactions per per second on the Solana blockchain. Very exciting news and hopefully we'll be talking to Anatoly in just a few minutes. He is waiting to come into the show. We are sorting out some audio stuff. In other news, Buco Capital bloke says the people who create HR slash security compliance training videos and platforms without an option to 2x video speed should be sent to Bukele's dungeons in El Salvador. The door, I think that's a legal thing, right? Like you can't.

You should be able to do 2x speed though.

Yeah. What's funny is Aaron, Aaron Eckerson Ericsson here says startup idea AI agent that watches this stuff for you Controversial post because people have done that and gotten a lot of trouble. If you have to legally watch a security compliance video and you don't watch it and you have a computer do that for you, you can get in trouble.

We got him ready.

Oh, we got Anatoly. Welcome to the stream. Sorry for the technical difficulties. Great to have you here. Thank you so much for joining. How are you?

Great, thanks for having me.

Fantastic.

Great to have you.

I would love to kick off with just a little bit of the State of the Union. I know a little bit of the history, but how do you tell the story of Solana and what you built? And then I want to go into the State of the Union of all the different projects and all the different applications and then we can kind of weave through some of those. But could you kick us off with just a little bit of an introduction?

Sure. So I'm Anatoly, I'm a co founder of Solana Labs CEO and I'm the kind of the brainchild of the Solana Protocol. It's my baby. I started it around 2017, 2018, with the dream of building a high performance blockchain network. So took us about two years to launch it. I don't know if folks remember 2020, but we launched right after the double black swan. Covid was just effectively became a thing. S And P dropped 70%, Bitcoin dropped 70%. And our launch date was announced to be three days later. We launched into the abyss. But I think it was like a lucky timing, I would say, because we were the only next generation network out and we're still, I think, processing more transactions than every other major blockchain combined. So not just more than every other one, but more than all of them combined, which is a pretty fun stat to have.

Yeah. What gave you confidence that you needed to build a new L1? There was a narrative at the time of just like, hey, we have existing networks, Bitcoin and Ethereum, let's just speed up those. And that feels like, I mean you can even abstract that all the way to, hey, like the Fiat transfer, Rails, the Swift system is slow. Let's just speed it up. We don't need an entirely new network. Like, what gave you confidence that you would have like an enduring advantage in speed and the other platforms, whether in Fiat or crypto, wouldn't just catch up.

Why do founders do things abstraction?

Yeah, that's the question I'm asking. Sorry.

The real reason is because I could. I spent most of my career doing high performance optimizations at Qualcomm So I kind of knew how silicon moves data. That's my expertise. And I knew the five to 10 people that I needed to hire. Most of them came out of Qualcomm. And we were just laser focused on building something that is optimized to its full potential. I don't know if it's gonna, like, how it's gonna revolutionize finance or anything like that. We, we did have the idea that these systems are useful for trading because if you kind of take a step back and try to look at like, what does it mean to synchronize the state and agree in a ledger globally, it's a similar problem to like how NASDAQ or NYSE do price discovery. They're trying to figure out what's the price of an asset given all of this crazy information that's happening around the world that all the market makers and traders are trying to send to their machines through their trades, to this exchange that's running in New York or whatever, but with a blockchain and this kind of unique technology that was developed really over the last two decades on the city of Byzantine fault tolerance and agreeing on a piece of state globally without a trusted third party, you can do the same thing, but you don't need to trust nyser, Nasdaq to do it. So I kind of had the sense that the purpose of these systems is to do price discovery. I'm not an exchange person, I've never built a financial product before, but I knew how to move data through these systems, how to synchronize them. So we looked at it as a physics problem and this is how we tackled it. And you know, we thought the things that are going to take advantage of this would be like real financial applications, stocks, all these things. But what happened was NFTs and meme coins were like the first big booms. But it's the same technology, the same infrastructure is used for those that you can now leverage for real equities and real global price discovery without a third party in the middle.

Yeah. Do you think that the, that like the. I see like this tech tree developing with all these different applications and every few years a check in with crypto. And there's different, there's different narratives, whether it's NFTs and meme coins, now it's prediction markets and stable coins. And for a while there was gaming and Metaverse. And it feels like the detractors of crypto point to that as like a failure. But I'm not sure that it's any different than what's happening in enterprise SaaS with ideas that get tried and fail, or space exploration with ideas that get tried and failed. Do you think there's something like fundamentally different about the way the crypto community explores the possibilities and the applications in the tech tree? Or do you think it's just done more transparently because everyone can see it? Or there's more tension on it because of the financial element? Like what do you think is going on?

I think, you know I grew up, up in the 90s, so it was there like in AOL chat rooms and RC chat rooms and the same kind of like almost religious ideas about what the Internet can accomplish for around then, you know, people were arguing about what file system they pick in their Linux kernel configuration with religious zeal on forums.

Like to the death.

Right. So I think when you have a technology that has this unforeseen changes that people can imagine could be unlocked by this, you can almost have this faith based argument to it. The difference now I think from the 90s is that we have the Internet, everything is global. So we're seeing the iteration cycles just to be insanely fast. And while a bunch of people tried a bunch of ideas two cycles ago, that was 2020 and now we're starting to see those ideas get traction. I think the fact that there's 250 billion in stablecoins that have been issued before Congress took up legislation is insane. There's no way I would have predicted this in 2020. It's just incomprehensible to me and it seems like very realistic that we're going to see over a trillion dollars in stablecoins by the end of, in the next four years. And people telling me that I'm bearish when I say only 1 trillion.

Is that stablecoin rollout. I feel like for a long time the whole idea of like bitcoin was actually in some ways a threat to the US dollar. And now it feels like with the latest White House announcement like it's crypto is actually strengthening the dollar and America what's actually going on.

It's like saying that gold is a threat to US dollar. I actually think that's kind of the wrong way to think about it. I'm not a finance person but I learned through osmosis. So bitcoin can't function as a US dollar because for you to use something for trades like trading oil or whatever, you need futures, you need a stable denominator to price those futures in. And if you're using bitcoin you have to pay for shorting bitcoin for the duration of that contract. Imagine taking out a mortgage in bitcoin and having to pay for 30 year short position on that Bitcoin. Right. That is, this just doesn't work.

Yeah.

And two like banks can, you know, if, when, when I have like an oil field and I want to buy, you know, whatever, a farm with it, I can use the oil field as collateral. The bank will create dollars up to the value of my collateral to facilitate, facilitate that transaction. You can't do that with Bitcoin, you can't do that with gold. Which is why these things don't function as like real world trading currencies. But they were great as a store of value, as a hedge against, you know, sovereign events, a whole bunch of other stuff. You know, fiat is managed by people, which is the great part and also the scary part. And gold is not managed by people, it's managed by physics. Bitcoin is managed by the rules that create, you know, enshrined in this protocol which are bounded by physics, which is what gives it these really nice properties. But I don't see a world where bitcoin weakens the US dollar. If anything, the growth in stablecoins has been as a spot. Vast majority of the growth in stablecoins has been used to support spot markets for bitcoin. So when those grow, you have more stablecoin demand, more Treasuries are bought. It's actually if anything has been working to benefit the US dollar.

Do you see any potential needs for new stable coins? Obviously with the new legislation, a lot of people, big institutions seeing dollar signs, thinking, well look how much, you know, look how much tether is printing, look how much circles making. We should get in the game like, but they should.

Competition is the best way to grow products, to iterate quickly. They 100% should.

Right?

Like why wouldn't you. This is, I think, you know, a lot of the US finance was built after World War II. But when you look at India and China, that has been built after the Internet, their financial infrastructure and rails are just much, much faster and more robust. Which is crazy to say that what we consider to be the west, the advanced economies are actually sitting on rails that were built before the Internet.

So on that note, what about the other side of this is institutions saying we want to, let's say somebody wants to tokenize securities and they think okay, well if we want to do this, we should make our own L2 or we should make our own chain. That feels like potentially a distraction from delivering the end value which is trustless, fast transactions globally.

So I have my own horse that I picked obviously. So I don't know the goal is to.

Yeah, so I guess what I'm pushing on is what I'm pushing on a little bit is like, like you know, competition for, for you, you know, or competition but not for me. But, but at the same time you guys, you guys have faced so many competitors over the years. You launched into a competitive market so you're not necessarily afraid of it.

You know the worst thing would be for the government to stop innovation. Totally like that. So like if those folks think that they can out compete us by launching an L2, let them try. My goal is to them to show that like hey, everything that you want to express in those smart contracts running in URL 2, you can do it much cheaper and faster than Solana and you'll actually grow revenues faster without needing all this info. This is what my pitch to those companies. But let them innovate and try. Like happy to.

Well, yeah, it's also if you choose to build on Solana, you just don't have to worry about onboarding developers. You don't have to worry about liquidity. All these things that you would have to really be, would have to be top of mind if you want to go compete. And potentially that's just a huge distraction from delivering the end product experience that you want.

That's the dream. We want to convince people there's no point to build their own private intranets. Just use the one public giant Internet that can host everything.

What about developer activity? I remember during 2021 and 2022 there was billions of value creation, billions of at least in USD terms on chain and there were still at some point I remember there was like single digit thousands like true blockchain engineers. How are you sort of tracking developer growth internally?

I think if you look at the reports that have been published online and developer growth, Solana is the second largest at this point and the fastest growing network. Ethereum is the largest. But I think we've been outpacing in terms of growth the number of developers onboarded. So like everything else you kind of. We saw in the early days there was a lot of demand for smart contract developers because there was a lot of innovation to be had in the smart contract plan. But I think of them more as drivers like Windows has excellent drivers. But you don't see innovation or that being a differentiator anymore because there's only so many smart contracts that actually get built. A stable coin is a token. So all the innovation to launch a stablecoin is happening not in the smart contract space, but the integration with the bank with how you handle the mint and withdrawals and that stuff. So a lot of the work has shifted away from L1 smart contract development to the higher levels. And this is where I think Solana is really Excel, because a lot of our focus has been on building reusable contracts that actually get deployed once and reused everywhere. There's really only two token standards on Solana. It's not an interface. There's one implementation called SPL token, one implementation called token 22 and everyone uses them. So they've been effectively through Lindi, verified to be correct and bug free. And you as an organization don't have to take smart contract risk when you deploy these.

Is there any hope that. I don't know if there'll be a new bull market and new smart contract development, but it felt like developing a secure smart contract with super high stakes. You needed an insanely good engineering team. Insanely good engineers hold all this crazy context in their head to understand all the different risk factors needed to reject.

50 North Korean engineers.

Yeah, it was not something that you just wanted to like, you know, like hack together a weekend. Yeah. But I was wondering if like the AI code tools would be an accelerant there. But at the same time, I've heard a lot of stuff about AI code gen tools being like kind of falling short. When you need a huge context window, you need to hold a bunch of things. So like, like is it smart contract development like the last thing that AI will be able to do in terms of code gen? Or is it actually an accelerant but we don't really need it because we have all the smart contracts we need.

I think the way that I've seen AI used effectively is augmenting an expert. So you have somebody that has deep expertise, they can just do more work. And where smart contracts could excel is like you write where AI can accelerate smart contract development is you built a complicated smart contract, you need to formally verify it. Sure, the formal verification stuff is a huge pain for and you need a lot of expertise, but you can automate a lot of the boilerplate and generation if you have an expert guiding in AI to go do that work. But you still need, I think, your core five or six super really great smart contracts engineers. They can just accomplish more with that small team using AI tools.

Did you read anything into the OpenAI and Google news about the IMO gold medal and the use of lean to do complex math that feels somewhat adjacent. Is that relevant?

This has been like. I've had 15 plus years of experience as an engineer. I love being an ica. I love churning up code. But now my workflow is using Claude and O3 and super heavy to go validate each other, come up with a robust plan, robust testing plan. And the jump in reasoning abilities just year over year, just from last year, has been astronomical. It went from being kind of a, I'm going to try this as a gimmick to now it's really an embedded part of my workflow. I can't imagine myself building software without having these tools now.

Do you think those are. Yeah, yeah.

I still don't trust the code that it generates. I think this is where an expert that can have this big context in the area of expertise can quickly scan stuff over and guide the tools to go do more testing and target more things. We still need those people, but their reasoning capabilities are getting stronger. Yeah, it's scary.

I don't know, there's kind of five years. Yeah, it feels like there's kind of two failure modes in crypto projects. One is technical, there's a bug and someone just drains the wallet or whatever and hacks it. And then there's another, which is like economics. And people didn't realize that there was no real solid foundation. They kind of wound up with like a Ponzi and it just kind of fails that way.

I mean, social engineering is the other big one.

Sure, sure. And I'm wondering, do you think that these reasoning models are. Are getting close to superhuman, close to amazing at economic reasoning?

Yeah.

You're right to point at that as being a really hard problem because this is where you really need to have that expert that can understand the economic attacks to guide these tools to go build a simulation and actually test it. And I wouldn't trust myself to be able to go find those. But given all these tools, even if I'm aware of the problems, me just asking. Oh, three, give me all the top 10 economic attacks and then simulate them. That's the best I can do. And it's going to suck. Like I can already tell you it's going to do maybe as good of a job as like a new grad.

Right.

But like, I think you really need to have an economic expert guide those tools similarly, like the economic expert. If they asked all three to go generate a bunch of bug free code, I'm going to go look at it and find a bunch of bugs. So I think you still need people in the loop there. I don't know what happens in five years given the pace of progress of AI, but it's remarkable of how good that is. But you still need people for now.

Jordy, you guys have been really good at, at building brand through short strings of words. So Internet capital markets, the team has really rallied around that. You hear it, it makes sense. And you can think about all the ways that that evolves with that phrase Internet capital markets. What are you excited about on a one year timeline? And maybe what are you excited about on a five year timeline?

I think getting fully approved regulated, boring tradfi stuff on chain that has claims on future cash flows. Like all that stuff that you read in the intelligent investor. Having those things be tokens I think is really, really important. And this is kind of my dream for Internet capital markets. Getting all the, you know, jumping through all the regulatory hoops, crossing out all the T's and dotting the I's, making sure this is as compliant as the government wants it to be and minimizes fraud. Because I think once you have those assets on chain you can then use the best of defi, which is the purpose of it is to create transparency and to run the risk engine every 400 milliseconds instead of once a week or whatever happens in a bank. Always know exactly what are the positions at risk collateral that particular contract is managing so everyone can see the actual risks involved and you don't end up with the kind of tail end failures that you see in traditional finance. That's the beauty of it. But we need real assets to do that because if you do that with just meme coins they don't have any value, excuse that price and eventually that just doesn't work. All the risks are correlated and you end up with a tail amount. That's to me the short term, the five year kind of dream for me is I would want a startup founder that wants to do this on their own, to be able to take all this open source software and to run their own ipo. Which means do all the disclosures, do the price discovery on chain, do use everything in an immutable open source smart contract and kind of do the Linux from scratch IPO and have the SEC approve it. And that doesn't mean that every founder is going to do that. You're going to have a bunch of services spring up on top of it that can take advantage of all this technology. But you should see the fees of doing that basically compress down to the actual value that they provide and no longer kind of be based on their ability to control the markets or the regulatory capture and stuff like that.

Yeah, it makes no sense.

Last question from my side. How, how did you. Were you conscious of trying to make Solana Lindy in the early days? Because I know it was like any crypto project. It was the price, massive amount of volatility and then you go through these periods of insane activity and I think we've seen this with various companies at the product level. OpenAI pump fun axiom is the other one that's done what, like 170 million of revenue in the last. In like six months or something, Something crazy like that. And anytime you see these like massive spikes in activity or revenue, the question is like, how sustainable is it? And you guys were able to kind of like navigate through the volatility and get to a point where I think everybody would have real conviction that Solana will have more activity a year from today, 5 years, 10 years, etc. But I feel like that's the number for crypto founders out there. It's like how do you go from massive activity to being durable and sort of Lindy?

I don't.

Know, it's somewhat like fundamental to the technology that when you reduce friction, when you make finance frictionless, that reduces moat boats, right? It makes it so that the things can leave as fast as they come.

I can rationally give you all those arguments, but the reality is that you're just worried about surviving the next eight weeks. This is how we operated from that launch because we simply didn't have any other option. We had limited Runway up until, for the first three, four years and trying to get as many developers onboarded, trying to increase the bandwidth of the network, reliability, all this stuff you're just thinking in eight week terms and you read every book on startups and stuff, that's actually what you're supposed to do. You're incrementally fighting for life and hopefully all those sprints, all those efforts, all those impulses accumulate into something sustainable. I think we're starting to see that sustainability actually play out through, you know, the last cycle. But it's really hard to predict. Like if I knew what was going to be really important, 12 months, you know, I, I don't think I'd need to work.

Can you give me the update on just the, the progress of decentralization? What's important to decentralize? How you increase decentralization. I remember when and maybe 2022 there was this Critique Solana is not as decentralized as the other platforms. Just judging by the performance of the company feels like that was not a bear case that stuck around. But what's actually happened with the company? What plans did you put in place and what do you feel like you've executed on properly to kind of satisfy the level of market demand for decentralization? Because I know that there's trade offs here.

I mean I look at it as a kind of key product like feature of the network. I grew up in the 90s, I loved Linux. This is how I learned how to code is hacking through Linux code. Huge believer of open source. Every part of the network you can participate permissionlessly. This is kind of the key part. And to me that's really important because when you think about disrupting finance, if you disrupt settlement, you've disrupted dtcc. Like I don't, I don't, you know, the number of people that can even know that what that company does, you can fit them all in one elevator, but everyone can name the exchanges, the brokerages that they use, and this is where all the money is made in finance. So if you cannot permissionlessly participate in the formation of, of order and price discovery, I think you haven't really decentralized the important part of finance. So Solana has always been about decentralizing how blocks are made, how transactions are ordered. The sequencer, which is in contrast to I think a lot of the direction that Ethereum went, where they have done an amazing job decentralizing settlement, but they've offloaded all the work of actually running the financial applications to layer 2s, where you now have like a single sequencer that runs the vast majority of layer 2s, and that sequencer has the same functionality that Robinhood does or right. So to me, you haven't really decentralized the important interesting part where money is made or revenues are made. So from my perspective, Solana has been more decentralized than a lot of the networks. Where it counts. Over the last three years, where we have taken a trade off is that the cost to run Solana Validator is higher because we are focusing on increasing throughput, making sure that anyone can participate in being a block producer and ordering transactions and all this stuff. The cost of those validators is higher, but over the last four years we haven't had to increase the cost to run the boxes because of the software and performance improvements. So if you actually look at the network, how it's run, how it's operated, I can't fire anyone that actually Works on it. Like Labs doesn't actually employ anyone that builds the protocol anymore. We're primarily focused on building a phone.

Yeah. Yeah, that makes sense.

I wish we had time to talk about the phone, but we'll have to have you back on again very soon.

This is great. Thank you so much for joining. Really enjoyed this.

Yeah, appreciate it.

We'll talk soon.

Thank you, guys.

Have a good bye. And let me tell you about Eight Sleep dot com. Five year warranty, 30 night risk free trial free returns, free shipping. Get a pod five over at Eight Sleep dot com. Well, exceptional sleep.

Tyler and Michael have secured burgers.

Oh, let's go back to them.

Let's go back to them. How are we doing?

How's it going, guys?

How you doing?

Yeah, so they're playing Star Trek behind me. It's really loud.

Okay.

But yes, we got the burgers here.

Okay. It's pretty good.

So I think there's a couple ways you can rate burgers.

Right.

So there's price point. So it's sitting at, I think it was like 1450 around.

Okay. That's pretty high.

It's a little pricey. So that means, like, you got to rate it against five guys. Shake Shack, right?

Sure.

It's kind of in that tier.

Yeah.

So I think it's solid. It's very similar to Shake Shack, I would say.

Okay.

Security.

Am I going to be going here? Is this my Go to burger? Probably not.

Okay.

You know, I'm more of an in and out kind of guy. I'm not very, you know, wealthy, so I gotta go cheaper sometimes. But, you know, there's some cool stuff. So apparently the fries and the hash browns are beef tallow.

Okay.

Wow.

Let's give it up for Tallow generational run.

So, yeah, definitely appeal there. Apparently they're really good. I think I showed you guys this earlier. But there's like the little boxes, right?

Yeah, yeah.

Cute.

Are there any protests going on? Is this a controversial space?

I have not seen any protests, actually. Surprisingly.

Seems like. Any Grok integrations?

Oh, yeah, Any Grok integration.

The only AI I've seen here is the optimist.

Talk to me about the actual ordering experience. Did you order from a tablet? Did you order from a human?

So, yeah, I think we ordered from a human. It was like totally normal. There was no kiosk or anything. But you can order from your Tesla.

We didn't try that because I think.

We, you know, we had to kind of expedite the process, but apparently you can do that.

But yeah.

It'S more optimist this year. Just doing the popcorn, you know it's not super hard to do but. And then there's like a nice bar over here.

Hey, gotta start somewhere.

Yeah. Popcorn serving.

Yeah.

Overall I'm not sure I would come back.

Okay.

Like specifically for the burger.

For the burger.

For a charge. For a charge though.

Charge. I wonder if the charging spree. If you get the, if you get the burger.

I think the charging is free.

Okay, that makes sense. There'll be a big draw. Yeah, that's very exciting.

Yeah, there's like 80 cars here but yeah, overall solid experience.

Very cool.

Very cool. All right, well enjoy your burgers and we'll see you back in the studio.

See you back in the studio. Tyler, thanks for joining on the ground reporting.

Awesome. Well, next up I believe we have Aaron from Box in the restream waiting room so we can bring him in when he's ready.

And in the meantime I'll tell you about Aaron Levy from Box. Welcome to the stream. I was getting near and had to read but you are here live. Thanks for hopping on. How are you doing?

Hey, good. How you guys doing?

It's good. You were one of our first guests a couple months.

Wow.

I mean I'll take all the credit for your guys success.

There you go. Take it.

I want to talk about, I want to talk about AI obviously I want to talk about quickly. I mean let's start with the consumer side and then I want to go into enterprise. Did you have a chance to read Fiji Simo's outline of where OpenAI is going in consumer kind of six categories. Health, knowledge retrieval, creativity. What are you using personally? What's your daily driver? Are you using with your family? Have you used it for health? What's just been your general experience with consumer AI?

I think I've hit every, every one of those use cases. It's, I mean it's yeah. Therapist, doctor, branding assistant.

What about executive coach? I thought that was an interesting one. She says that she has a coach. Obviously you're at a level where you can afford a full time human coach but what, what, what, what goes into a good coaching experience at the executive level?

Yeah, I mean that's a fantastic use case. Probably actually I should be using it for that. I'm sure anybody that works with me wishes I did. But you know often you're, you're bringing a coach a set of problems that you're running into. I've got this org design issue. I've got these people that aren't collaborating well and oftentimes it's most actually just helpful. Just the purpose of talking about the issue and then laying it out. That gets you thinking about it and then seeing a set of options. So I think ChatGPT would obviously make a fantastic coach for that because just the very act of just getting you to be able to describe the issue and then seeing a set of options would be helpful in like 90% of situations. So I think those, those use cases are great. I mean the health care stuff alone has been, has been extremely powerful. I seem to like run into like one new ailment per week. And so I'm like, and I used to just, I, I used to go into urgent care like way too frequently. Like, like, oh, I have some like sensitivity in my finger. And then I'd like go to urgent care. And so now just chatgpt just solves all those.

You are a hypochondriac. Anyway, on the org structure issue, what you would go to an executive coach about, do you feel like AI should be more of like a product team or more of like a service team? Like do you see it like it's my infrastructure organization or it's my front end engineering packages versus it is a new product that will sit alongside other products and maybe be sold as a different skew by the sales team. Because I've been going back and forth on this, but I'd love your take before I kind of wrestle with it.

Is this in a B2B context?

Yeah. Yeah. In your business, like I imagine that you're thinking right now there are LLMs, there are tools, there are APIs, there's a whole bunch of stuff. There's coding agents and IDEs and stuff. And you want to get this stuff into the hands of everyone in your organization. The question is, is do you? I bet a lot of companies I imagine are thinking about like, do we need an AI organization? Do we need an AI product? And you can think about like Salesforce is launching, like in Copilot is like a separate SKU almost that sits alongside Gemini, is a separate subscription, it's a separate product, separate app. Separate app versus just hey, we do X, Y and Z. And all of that is made better by AI in the same way that, you know, memory caching like redis the database made things better across everything. But it was not its own product.

Yeah. I think in our case, and I think so much depends on the type of product that you were in before AI happened.

Yeah, totally.

In our case, what we did was our chatgpt moment. Was, you know, same time as everybody else. But we did, you know, fortunately step back and we said, okay, if we were to found our company in a post AI world, how would we treat the very kind of business model, the product experience, the actual value proposition? And we started kind of laying that foundation. Now it took at least a year and a half to like execute in the way that even looked like what you could do from a, from a blank sheet of paper. But the idea was if we were to start box in 2025, let's say we ran this exercise now, you know, we wouldn't think about the AI version and the not AI version. We wouldn't be like, you go over here to do AI and everything else is sort of like dumb. And so we decided to bake AI into the core value proposition of the product. And that shows up in the, in the kind of obvious ways you'd expect. So let you talk to your data, ask questions of documents, take a collection of content and be able to query it and ask questions of it. And then now within a world of agents that's also showing up as, you know, agents being able to kind of run around and execute automated tasks for you. So a very natural one for us is a lot of customers have all of this unstructured data. It could be contracts or invoices or marketing assets and they want to be able to read what's in that data and then basically apply structure to unstructured content. So take all of the variables from a contract or from an invoice or from a digital asset and then let me have effectively intelligence around that. I can ask any question of that data now. I can automate any workflow around it. I could have a dashboard that shows me exactly when the different contracts are up for renewal or which ones have risky clauses in them. And so this is fundamentally changing the entire value proposition of our product. It gets us more in line with what our holy grail was to begin with, which is let you tap into all of this information that you have in the enterprise. But, but yeah, so this is built directly into the core fabric of the platform. And most product managers at Box at this point are working on something AI related. There's, there's sort of nobody that is, is unaffected by, by AI at this point.

How do you think about AI surfacing itself in the product in a, I don't know, like above the UI or below the ui, I don't know, front end or back end. Basically, like, like I feel like, I love when a company I use is saying, hey, we're going all in on AI, but I don't necessarily want a chat box with every product. What I want is, hey, you guys did the hard work, you guys did the prompting and all of a sudden search just got better. Or if I want to just click a button and see it as a CSV, boom, it's there. Or it's already, you know, it's already been transformed, it's already in a database, it's already built for me instead of me having to actually say that. But it's really hard to define those things. So how do you think about like, is this going to be the prompt is in the hands of the user or the prompt lives within the box? Engineering team.

Yep. You know, it's entirely case by case, probably across all of software. Even in our product, we have variants of both of those. So we have a product experience where you can chat with your documents, which is, means that it's another chat box.

Yep.

We have a product that is, for all intents and purposes, you never have to even think about it as AI. It's data extraction from a document. You press, you know, extract data, you don't chat with it. And then, and then the agent is, you know, a set of context, a set of tools that we've, we've effectively tuned to that workflow. But you don't have to think about it as being AI or not. And it's not obvious which one wins out. I think there's a variety of ways that people will expect to use, you know, these use cases. The, the thing I'm probably most fascinated with and the thing that will have the most, you know, GDP impact is effectively these background agent use cases. You know, when, when AI first started, you know, emerging, you know, really just due to chat GPT, we, we thought about AI as, okay, I go into a prompt window and I ask a question, I get an answer back. Or maybe, you know, a year prior to that you had GitHub Co Pilot, which was really kind of of type ahead prediction functionality. In both of those cases, the AI can only work as fast as you can. And so that means our productivity gain was still capped by how fast we could work with background agents. You're untethered in terms of the ultimate upside of the amount of productivity gain. Because it's just if you have a well described prompt that could basically translate, you know, days or weeks worth of work into a couple minutes for the agent, then that's, you know, obviously like that could be a hundred x productivity gain and so we have a number of features we're working on that more relate to background agent type type use cases and that's I think where what's most exciting. So when you think about Cursor's background agent or you think about Codex or what Replit does with its agent, that's way more of the future and that's probably more what we're putting our efforts into.

Yeah, I feel like it's like it's less flashy and it doesn't get as much attention for some reason but. And it's harder, it's harder to make AI just a button and it works but when it, when it, when somebody can boil that down to click button get result like it's just, that's the original magic of software.

But I think it's still probably click button but give some instructions to get what you want. But it's not as open ended as it was before, which is just, just here's an empty chat box. Do anything in the world. This will be an interesting tension between let's say the most horizontal frontier players versus the applied more vertical specific use cases, the vertical players and it could be industry vertical or some other kind of vertically integrated product. The vertical or domain specific players will be able to pre pack in the use case and that will actually be for many enterprises the easier to adopt capability instead of like the super horizontal. We can do everything super intelligence. Understanding the use case in the domain will likely improve the efficacy and ability to drive the rollout within the enterprise.

How are you thinking about box as a, is it a garden that you welcome people to? Is it a walled garden you guys are building?

Would you be okay with me taking my data and share with.

Well, well yeah, it's just like you guys are, you guys are building a bunch of workflows on top of your data. But then I imagine you have, you, you're happy to in some cases let other companies come and, and make the DA data more valuable.

What's your stance on letting the fox in the hen house? We've been going back and forth on that. Sometimes people say it's a friendly fox. Let it in the hen house. Let it in the hen house.

Yeah, we're, we're a public park. Anybody can, can, can build their garden here.

That's great.

No, I mean I, I, I, I, I don't want to read between the lines too much but I assume this is about some of the closed off data access, you know, piping data walls. Yeah, yeah, tricky topic. So for us I'll just say our general biases. Well, so first of all, to be unbelievably clear, any, any data within boxes, our customers data. So just get that out of the way early. In general, we bias toward a very heavy degree of API access into that data. There's a couple complicated issues that are the emerging topics in the agent world. And this is obviously probably germane to the origin of the question. There are some systems that do these kind of heavy indexing of data tasks. And in those areas you have a couple issues. One, you just have a cost that the originating vendor then incurs based on that indexing. But then also you have these open questions around security and permissions and data governance because you're trying to keep permission models in sync between multiple systems. And so all of a sudden the brand promise of one platform can possibly be sort of mutated by another platform if there's a data leak event or whatnot because your data was index by that other system. So these are going to be more, I'd consider them more open questions that need to be figured out by the industry. I'm more a fan of this idea that you'll have any system that today sort of wants to index all of the information from another platform. A sort of more ideal architecture would be that system just talks to the system with all the data and says, hey, I'm looking for this particular piece of information. Can your agent go run off and find that for me and then, and then pull that into that other agent. So the problem is, is that everybody's agents today operate differently. We all rank the information differently, there's different latency. So, so that's why you kind of need indexing right now. But I think in five years from now I would be, I think it would be a little bit of an architectural anomaly if, if you had to index all information like 20 times across the Internet, that seems like that would be very inefficient and then it would lead to lots of stuff, security vulnerabilities because let's say I share a set of documents or a communication channel with you and then that gets indexed by some AI agent system. But then I unshare that with you. How quickly does that propagate to the agent system that was indexing that data? And now we have a security risk that, that, that that first system has no control over. So these are the, the very real kind of issues that you run into an enterprise software. Which is why I also think that you're going to continue to see so much power in the systems of record even in a world of AI agents.

I have two questions.

When you speak speaking of AI agents specifically, there's billions of dollars being poured into roll ups to acquire maybe more kind of Main street style businesses, let's say an accounting firm. And the promise there is basically that we're going to, that the investor group is going to be able to and operator is going to be able to dramatically reduce headcount and increase the earnings potential of the business. Do you think that there's enough excitement around agents and agentic workflows that these companies have been able to raise billions of dollars? Do you think that agents are already at a point where they are going to be able to kind of deliver on that, on that thesis or will companies. There's two paths. Like companies can leverage off the shelf agents, maybe coding agents for example, or they can build their own agents or workflows. But how ready are these businesses to be able to strip out, let's say like 50% of headcount?

I think that depends on do you want to grow revenue or are you fine with the existing revenue install base of that company and then likely some kind of terminal value that you can extract out of that. There's no question you could cut costs with AI agents in a number of spaces. But if you had a very competitive industry where the product roadmap really mattered, I think you'd probably be more in the camp of using AI agents to accelerate the work that you're doing as opposed to cutting headcount. So I think all depends on the space. I haven't, I haven't picked up on which industry people are most attracted to. Is it like healthcare office, you know, back office firms? Is it, is it law firms? Is it accounting firms? I think it'd be hard. You'd have to be really running a business very inefficiently if you could cut 50% of the cost with AI and then, and then keep the business sort of maintaining its customer base. But you know, private equity has found those opportunities in the past. So I, I think it's just a more, it's the evolutionary kind of update to probably how private equity will think about some of these efficiency gains and it has a place in the economy. It's not something that is sort of to me the most exciting part of AI, but it could work and it could produce some degree of profit.

Yeah, makes sense. We have a friend who is running a startup and recently a hyperscaler launched a company competitor. What advice would you give him for competing with Someone that basically has unlimited resources. And how do you think about getting through that as an entrepreneur? It must be an emotional roller coaster. We've talked to him a little bit and I've been thinking about different case studies and mental models and companies that have made it through and it's fascinating. But what would you say to a founder in that space? Well, capitalized products loved. But now facing fierce competition from Hyperscaler.

I think there's a therapist mode in ChatGPT apparently that you can trigger. Is this like a known company? Can you say the company or not?

Yeah, browser based. We've been talking about on the show for a while. Okay, okay. It's a computer use agent or it helps you. If you have an agent then you needs to go browse the web. It's an API that lets you harness the computer and actually go click on things. And AWS launched something and obviously that's you know, competitive and you know, it's, it's something that, you know, we had him on the show a couple times. We asked, hey, this feels like something that AWS might launch. They wound up doing it. You know, like what would your advice be to him? I guess.

Yeah. So I think actually the first of all the. If you somebody maybe you guys could. Do you have like an analyst team yet? Does that, does that exist?

It's coming, it's coming together. We have some interns.

I think you should deep research.

Yeah. If you, if you could run some analysis. I bet you in, in you know the history of hyperscalers launching a competing capability and then you look at that, that market. I bet in all cases. Sorry, not in all cases but, but on average the market size kind of grows for even the independent players. I mean think about how many times Snowflake or Databricks probably shouldn't exist based on some of the data services of the Hyperscalers or Cloudflare for Matthew, probably like 10 years running would show the market share graph of Cloudflare versus all of the other CDNs and you would have been like why would Amazon or Google not wipe out Cloudflare? It's like they already have the network. It's not that hard. In fact in many cases Cloudflare pre runs on their network. And yet it turns out that like hyper focused teams and platforms in big markets are usually able to carve out enough, enough of the space because you're just going to be just more wired into the customer base, the use cases. The better APIs, you're going to jump on the next trend more Quickly in the case of Amazon, I'm guessing that Amazon won't work as well with OpenAI where browser based can work with, with, with all of the model providers. So there tends to be, you know, with very few exceptions, plenty of, of, of sort of moves that you can make in these kinds of competitive situations. And in a lot of cases it just actually, you know, again lifts up the awareness of the market, makes it more exciting. You tend to not want to be a market in a market by yourself unless you're like Nvidia or something. Like for the most part having, you know, being in a dynamic market where people are comparing options and looking at search SDKs and choosing things and talking about stuff that usually actually grows the market as opposed to, you know, makes it, makes it more zero sum. So, so I would, I would be, I would be bullish in that, in that scenario more than anything.

So do you think like 10, 15 years ago you or the, or you know, the chattering class was saying that about cloud storage broadly?

Oh, saying that we would be crushed.

Yeah, saying that you would be crushed. Or did anyone clock it correctly? Because what actually happened was not, you know, oh, one wins, one doesn't. One India, like there's multiple independent companies that are doing well. There's also hyperscalers that have grown. It's been this weird like oligopolistic positive sum market. It's been fantastic for all parties involved. Basically.

Yeah, no, no, nobody, nobody got it right. I mean our, our first, our, our, our first funding round was, I think our valuation was $240,000.

So.

So I mean basically the idea was like storage was a commodity but what people didn't realize was no, it's the software above the storage that matters. And so, so assuming that you're in a market that is going to grow again, zero sum markets are very different, but it's hard to find zero sum markets in software right now unless you're like deeply legacy. If you're in a fast growing market, there's usually a move, there's usually some range of motion. You have to differentiate, to specialize, to go into a vertical, to build more software on top of the commodity infrastructure. So I think we're in a period right now where you can kind of be generically bullish on, on just like categories broadly. Now maybe we don't need the 20th kind of language model. That is, there's some asterisks to this, but if you're one or two in a category right now and a big player enters, I think you Just ride it out because it's just too early at the moment on what's happening.

Yeah. It seems like a wildly different market dynamic in the enterprise in B2B than in B2C where it's very much winner take all. And if you gave me $100 million to start a competitor, direct competitor to ChatGPT. No, yeah, it doesn't, it just doesn't matter at this point because there's so much energy and aggregation and network effects and all sorts of different things anyway.

And yet at the same time, I'd say every vertical in the enterprise is up for grabs. Yeah, I think there's no vertical where you can just completely call a winner. I think there's some cases, maybe these healthcare providers, providers that do transcription and like, maybe you can call a winner in that space.

Yeah.

But for the most part, you know, when I talk to CIOs, they are, they're in their very earliest phases of picking their first set of platforms for these major use cases. And so we have a window right now where you'll have many, many names that emerge that will be, you know, 100 times bigger in five years from now.

Totally, yeah. And to the earlier point we were talking about where like AI can be not just a new product for a company that's existing, but, but just little improvements to everything that exists and that winds up being a bunch of different vendors, a bunch of different internal projects, a bunch of different APIs, a bunch of different code revisions. There's so many different areas to just squeeze out percentages of improvements. So exciting stuff.

Last question. I have. You've seen a number of different cycles. You started the company in 2005, so you've.

I do look that tired.

Yeah. Yes.

But, but I'm curious. We were joking about a week ago that there's a lot, I mean, there's so many different, like signals blaring that, that obviously there's a lot of excitement, a lot of new capability coming online, new intelligence being birthed. At the same time, we have ethereum treasuries and SPACs for companies that maybe shouldn't be spacked. NFT profile pictures kind of coming back. How do you do. I'm not asking you to like call the top or call the bottom or anything, but, but do you have, do you have any type of outlook, do you have any kind of concerns about, about how overheated things could be right now?

Weirdly, I'm, I'm, I'm pretty, I tend to be pretty much on the conservative side in general. And it's lost me lots of money by, by just you know, not believing in like 80% of things that have worked out but for AI. And then maybe this is a counter signal actually. So maybe this is like the Jim Cramer effect. But, but in AI I don't think we have reached anything close to, close to any, any peak of anything now. Sure you might be able to point to specific categories that are, that are a little inflated, but when you look at, I mean this isn't, this is a, an economy altering technology and if you just look at it as any percentage of labor, you know, as, as, as one way to model the potential size of these markets, we're in still the very earliest phase of what this looks like any.

Yeah. In 1999 if you were like, you know these, these Internet companies are really potentially overvalued, you maybe looked smart for a little bit, but it, but over a decade you look pretty, pretty dumb.

But, but if you even took 99, business, if you took nine, if you did a 99, you know, kind of like extrapolation from any of these valuations open, I would probably be worth 5 trillion. Like, like, like these are not, I mean if you look at like, like those companies were valued on you know, 100, 200, 300x revenue.

Yep.

For the mature companies. So that like we are not even in 99 territory on the amount of, of kind of hype and excitement that there is. So I'm pretty bullish on where things go from here. If you look at something like the enterprise software market, it's a few hundred billion dollar market in just like let's say the US and total spend on enterprise software. There's no reason why this isn't a doubling or a tripling even in the conservative scenarios when you can have AI agents go and do real work that is tied to the software because you just have so many more categories that the enterprise software can sell into. And there's just examples everywhere like the enterprise software size. The category size of enterprise software for the legal industry like five years ago was about a couple billion dollars max. Like that is all that the legal industry spent on enterprise software. And in a world of AI agents, I think you could easily underwrite 10, 20, 30 billion dollars being spent on just AI agent automated work in the legal space. So you could have a lot of these spaces that become five or ten times larger than they were in the pre AI era. And I think you could do that across every category of knowledge work for the most part.

Makes total sense how last Question I have is how tolerant do you think CIOs and executives broadly are going to be of the. Like, you know, if you're thinking about, you know, Apple, for example, thinking about implementing an LLM, it's not in Apple's nature to have imperfection.

Right.

Like, they're not looking for something that even one out of a thousand times is going to say something that's offensive or anything like that. And we were thinking, you know, we were talking about Grok. Grok obviously is on a wild trajectory. They're closing, you know, they closed a massive partnership with the, with the DoD last week. And that's partly, I imagine, like, the Elon effect. But how, how tolerant do you think CIOs will be of just the kind of inconsistent nature of AI agents, you know, being. Saying, we're going to make a big bet on a, on a lab. Even though, even though one out of. Yeah, one out of 10,000 times it's going to say something deterministic. Yeah. And one out of every 10,000 times use the product. It might say something that 10 years ago you would have been fired for if you implemented that software.

Yeah. You can't, like, make Hitler jokes in, like, a company setting. So the, you know, I would say, increasingly, the tolerance is going up because the understanding and the shared understanding of what these models are doing is going up. And so what's happening is companies are putting in sort of, you know, kind of informal or formal guardrails on the fact that these models are probabilistic. And that will sometimes take the form of just an internal policy that says, okay, you know, the AI agent is going to give you your first draft, but your job and your responsibility and your liability is to ensure that what you're putting into production or the legal brief that you're writing or the marketing asset that you're creating is fully reviewed by a human. And that, that is this switch from, you know, maybe two years ago, we would have looked at a model's kind of inaccuracy as a flaw in the AI. And now we have sort of accepted that it's just a part of the workflow. I walked by, you know, an engineer's desk a couple weeks ago, and I've just said, hey, what's your now new common practice of doing work? And, you know, he kicks off an agent to go write a bunch of code, and then his job is to go review the code and fix its errors and, you know, clean up syntax and whatnot that might be different. And that's Just an accepted reality. Whereas maybe two years ago you would say, hey, this. This model is producing a bunch of, you know, kind of garbage code. It probably was garbage because of just where the models were at.

But.

But you would have seen that as a flaw, as opposed to. That is just an acceptance. That's an accepted reality of how these systems work now.

Yeah.

And so with.

With that, I think evolution of the understanding, then you start to flip the mindset, which is, okay, I can now use AI to give me the first draft of the thing that I'm doing. It can make the first draft of the blog post. It can auto transcribe the doctor note. It can generate the first draft of your board deck. Yes. And then we can go through it and review it and clean it up. And that still saves you 10 hours. And so that recognition is now kind of rippling through most organizations. This is why this idea of going AI first is. Is kind of picking up steam. I talked to a lot of CEOs and CIOs in the Fortune 500 kind of universe, and this is the most, easily the most exciting and animated kind of topic that has existed in 20 years in technology.

Yeah. And they know they're much more likely to be fired for not being at the forefront of this wave than having a model that goes off the rails and offends a user. One out of every. Every $100,000.

There is absolutely more room for ask for permission in this phase of the, of the. Of the kind of excitement, you know, kind of adoption curve that we're seeing.

Totally, totally. Well, we've kept you too long. Thank you so much for joining.

Great hanging. As always.

Ask for forgiveness, not. Not permission.

Yeah, yeah, yeah, yeah. Ask for forgiveness. That makes sense.

And thank you for catalyzing our early success.

Yes, thank you. We appreciate it. It was very helpful.

You're the man.

We'll talk to you soon. Cheers, bye. Really quickly, let me tell you. Bezel. Get bezel.com. your Bezel Concierge is available now to source you any watch on the planet. Seriously, any watch. And we will bring in Neil Parikh from Slingshot AI announcing Ash. Let's bring him into the studio from the Restream waiting room. How you guys doing?

What's going on, guys?

Good to meet you both. Kick us off with an introduction.

Hey, I'm Neil, one of the co founders of Slingshot.

And I'm Daniel.

Good to meet you guys. Introduce the company, introduce the product.

Absolutely, yeah. So Neil and I met about 18 months ago. We were both chasing the same vision. AI for mental health. We're finally coming out of stealth. We built the first AI designed for therapy. You probably know there's a mental health crisis product launch.

I gotta do it.

Wait, wait, wait.

Also, did you raise some money?

So we're announcing our Fundraise. We've raised 93 million to date.

Let's go. Congratulations.

There we go. Almost jumped the gun there. That's a big number.

Fantastic.

I was just going to share. I mean, you probably know this mental health crisis, you might not know that for every 10,000 people out there who need help, there's one person to offer it. Wow. There's kind of no way that we can, can get past that except for AI. So that's why we've worked quietly, carefully, with clinicians in the loop to build the first foundation model for psychology and designed it to actually help people with their mental health.

Yeah. What does that mean? First foundation model, fine tuning, pre training. What's the actual tech stack that you're building?

Yeah, we train in three steps. So we do continued pre training not from scratch, but from a checkpoint order of magnitude. It's about 1% the size of a data set that a foundation model lab would use. So not going to cost us $10 billion, but enough to substantially change the behavior of the model and introduce completely new knowledge.

Interesting.

We then do alignment, which is where our clinical team adapts from the modality of human therapy to AI therapy and learns how this completely new kind of app works. And then finally we do reinforcement learning. Learning from what works at scale.

That makes sense.

What concerns you about people using traditional LLMs models for therapy today? You know, just basically going into their favorite app and, and you know, you can't, you, you effectively can't stop somebody from starting to use an LLM for therapy. But we've seen over the last two weeks specifically, that seems to be some very real concerns around some of the people.

Kind of, it feels like they're almost accidentally jailbreaking the model, winding up in sci fi territory, role playing, like. Like what are the best case scenarios? It sounds like those three strategies that you outlined are part of it. But what else is going on that can make sure that there's always a good outcome?

I think the first thing we should acknowledge is like ChatGPT and Cloud are not made for therapy.

Right.

Like they're not trained on clinical data. People can end up down these very weird rabbit holes like we've seen, right, where people end up in essentially a mode collapse or somewhere that's in A very weird part of the distribution where it's bringing out psychosis and other issues and stuff. You know, they'll say that it's useful for support, but at the end of the day, what we're building is something that's very different.

Right.

The first way to think about it is we're not trying to build an instruction following model. Like if you go to ChatGPT, it's an assistant. So if you ask it like, hey, give me a recipe for a piece of cake. And ChatGPT were to ask you like, so why are you hungry? You'd be like, what the.

That's so annoying. Yeah, it's the alignment by default question. Right, sorry. Yeah, alignment by default. Like the model is supposed to, to always help you answer the question. So if you ask it, you know how, like prove that I'm a genius. It will just say, okay, of course, let's, let's, let's do that, no problem. And that's not what a therapist does.

Exactly. If you go to a therapist and you're like, hey, I feel angry, help me. You know, they're gonna say, so why is anger a bad thing? You know, and you're gonna be like, why is anger a bad thing? Like, I don't know. And then you get into some interesting deep territory and that's where change happens.

Sure.

But yeah, ChatGPT is not therapy. They're not. I actually just saw that Sam Altman posted about this and had said, yeah, ChatGPT, a lot of people are using it for therapy, but it's not what it's built for. And we're looking forward to seeing a startup emerge in this space.

So interesting how, how excited are you guys to just like, I mean, effectively you're going to be running them. Just by getting this out to more people, you're going to be running a massive trial. I think the debate, the debate among, you know, high functioning people, a lot of people that listen to the show, people in Silicon Valley in general, is that like there's almost like this question of like, does therapy even work? Is it good? Does it put you in these kind of doom loops? How are you guys like, like looking to measure results? Right. You're actually wanting to change lives, but what does that look like?

Yeah, super true by the way, on the controversy. It's funny on X Neil posted today for our launch and like if you read through it, it's fascinating how, how much people find this controversial and you know, it's interesting to see what's, what's going on there what people are really feeling when they're thinking about this.

Yeah.

And it's.

I feel like it's super common where my parents, when I was an angry teenager in high school, they were like, you should see a therapist. And they would ask me, how was the therapist? And I would say, well, I don't know how the therapist was, but it was helpful to kind of just talk through the things that were top of mind for me. So I feel like there's this question of, like, can you make something that's valuable and helps people better understand themselves and the decisions they're making? But then there's all like, how do you actually be more beneficial than just having them sort of talk through a problem and actually implement change 100%.

So we are, we, we built with a beta group of 50,000 people to make sure that we're building this right, that we were able to show efficacy, safety. We are. We've not yet published our results, it hasn't gone through peer review, but very exciting results. So far we've been able to show clinically effective results for symptoms of anxiety, depression, loneliness, increasing a sense of hope, achieving your goals. And I think one that was coolest for us was actually increasing the number of people that you have in your support system in the real world.

Are all those metrics like self reported? Like, I fill out a survey and say I'm feeling anxious, and then at the end of my therapy session I say, okay, I'm feeling less anxious. On like a scale of 1 to 10, is that.

Basically we use the official metrics. So phq9 and gad7 are the main ones. Those are the official ones for depression and anxiety, but we use a number of others. There's like the UCLA metric, but essentially we track people over time from before they start using the app through using the app. And we measure how these symptoms change over time to see whether or not it sustains. The interesting thing is, I mean, these are used widely across every area of psychology. They're also. It has been shown, I think, interestingly, that with. With normal chatbots, on average, after using it for a while, you actually reduce your connection to people in the real world. Not too surprising. It was amazing for us to see that with ash, people actually did build stronger connections in the real world and that just has to do with building something that's purpose built to help people with their mental health.

Yeah.

How excited are you guys around frequency? I think one of the challenges with therapy and actually driving change is if somebody's seeing a Therapist once a week or every couple weeks it's like very easy to kind of revert back into old patterns or forget what you had just talked about. And we're trying to, to change is part of the potential here is like somebody can effectively have this like constant contact with a therapist or do you think, or the equivalent of a therapist. Yeah.

So one thing that's important to know is that I think we're inventing a whole new modality of therapy.

Right.

Something like this hasn't really existed before. Which means that with that comes, you know, we can basically throw out, you know, the whole nature of like we have to have a 45 minute session. It happens once a week. Right. Crisis or like getting into a tough situation might happen at 2 o' clock in the morning. Right. Your therapist is going to answer the phone at that time. Now that said, we also don't want people talking for six hours on one day. Like we feel about who. It's like important for you to like work on something, probably sleep it out. Right. Think about it, process it, continue to work on it over some amount of time. Because like growth takes some amount of time. Like very few people just snap and then overnight, you know, are completely different.

Though I would say this has been like a design evolution for as we've been building. Like early on we noticed people wanted to use it until they solved their problem. Even if that takes 10 hours and that really doesn't work, you need to at minimum sleep. Most change happens when you sleep, when you engage in the world. So one thing that does that's unique compared to others is at some point it does gently push you out. It will say things like, okay, let me just ask you one more question. And then maybe this would be a good time to end for its day. And what that does is it builds a more healthy habit where you're able to use this as something that you turn to. And people do usually engage a lot more frequently than they would with therapy, but they'll engage so that they can actually get through their problem and not create some sense of dependency. Instead it's something that you come back to something that you're working on in a style that makes sense and a frequency that makes sense for you and not just for your insurance company.

Very cool.

I have a bunch more questions about business model and stuff, but we are out of time. Thank you so much for hopping on. Congratulations on the launch.

Last question. Why Slingshot?

Ah, it's a great question. Well, we're. Our product is called Ash Ash AI Therapy highly recommend checking it out. Slingshot, I think makes sense. Great as like a tech company communicate the. The idea of like the massive change that you go through. Ash was much more gentle, friendly, you know, not too human sounding. Not. Not human sounding. And so it's, it's.

If you're still depressed tomorrow, I will take a slingshot and hit you in the head.

Hit me in the head with it.

All right, well try Ash.

We'd love your feedback.

Thanks so much for hopping on. We will talk to you soon. Have a good one. Up next, we have Jan Srimak from California Forever. He has some exciting news. He shared it re industrialized last week. We were slammed. We got him on the show today to break it down for us. Sorry for keeping you waiting. Jan, good to see you. How are you? Beautiful. Is that a real photo? Are we looking at a virtual background?

He's on a hot air balloon right now.

Exactly.

Nah, that's a virtual background.

But it looks good.

Will hopefully be a real photo.

What is it, what is it describing or what is it showing?

It's showing the Solano Foundry. It's showing this advanced manufacturing park that we announced last week.

Very cool.

Which is at the edge of the new city.

Very cool. Yeah. Announced it re industrialized. We were confused because we were like, wait, California Forever is building in Detroit, but you're building in California? We're Californians. We love to see this. Take us through a little bit more of the announcement. What exactly is coming together? I imagine there's a piece of public support, some government stuff, some financial capital. There's a lot of different moving pieces to this. What is in the announcement specifically?

Yeah, a few different components. So the Solano Foundry is in the new city and it has been in the plan. We've had a big area for basically industry and technology in the plan since the beginning. That hasn't changed. What's changed with the announcement is we've put a lot more. A lot more details behind it. And so we've put forward specific master plans. The industries we would focus on. We've worked with jll which is probably the leader in this domain. I mean JLL works for majority of the companies in the valley. When they decide that they need to go from 50 employees to 500, they call JLL and they say, hey, where we should go? And JLL has spent as they. As they've told us, they've spent the last 10 years moving companies out of California and they're kind of sick of doing that. And you're gonna Give them another option to do it closer, closer to home. So we're parting up. Jll they wrote a whole 40 page white paper about why they felt that actually you could do manufacturing in California if you had a scale that we have and if you are an hour outside of Silicon Valley. And so they published a white paper. They've joined us as the exclusive leasing agent for the 2,100 acres. It's about 40 million square feet of space. So it'll be the biggest advanced manufacturing park in California. And then it would work as a integrated ecosystem with both the new city that we're building and with the Solano shipyard, which is about seven miles south of there.

Okay, tell me some historical examples that you're learning from. I want to hear about Apple's Fremont factory. That was an example of California manufacturing in advanced computing. Didn't go so well. Then we're seeing a bunch of promising stuff happen in Arizona with tsmc. What are the various lessons that you're pulling from? What are the anecdotes?

Yeah, real quick. I just wanted to get. So the foundry and the shipyard I imagine will share, like be heavily connected in terms of a company that's at the shipyard might also have a facility at the foundry. And they would obviously have talent living in the city. How do the three kind of core areas.

It's a great question. So Citi provides a place for all of these people to live, whether they work at the shipyard or whether they work at the foundry. Obviously employee housing, huge issue in California, particularly if your people have to commute from far away. Right. That's one of the biggest drivers that makes people quit their job is they just get fed up with doing a two hour commute. And so we can basically provide a 10 minute commute next to the foundry, 15 minutes from the shipyard. People can walk to work, people could bike to work. I mean, there's very few places in America where you could work in a factory and bike to work.

Work.

Everyone keeps talking about, are we going to re industrialize the country? But nobody's talking about the reality that nobody wants to work off some random freeway exit in the middle of. In the middle of Texas.

Two hours in the desert.

Exactly. You drive to the factory an hour and a half from your house, and then you work off a freeway exit next to a Burger king and a McDonald's.

Right.

Like who wants to work?

Somehow there's still traffic even though these places are in the middle.

Yeah, exactly, exactly, exactly, exactly.

Right.

And so I think if we're going to Actually try to get people to work in manufacturing again. You have to provide a quality of life that I think our generation has come to expect. Right. Which means you need to be able to go work in a factory and then you want to have lunch. So you meet up your friends and you sit in an outdoor plaza and you hang out and you can do the same thing after work. And there's basically nowhere in America where you can get that other than this place. And so that's a component of it. And then, yes, the, the shipyard and the foundry are very similar. The shipyard is basically the foundry on the water. I mean, the foundry is an advanced manufacturing park and shipyard, if you really think about what that is, that's a manufacturing park on the water that just happens to have really large parcels. And so you would have companies that build ships in the shipyard and then their suppliers are in the foundry. And then we actually have a rail connection between the two. And so you can ship the components from the foundry to the shipyard. And so the whole thing is basically this integrated advanced manufacturing ecosystem where in particular, we've learned a ton from how China does it. I mean, you look at the evolution of this whole thing, and we started it. I mean, we perfected it in America during the Second World War. We built the global manufacturing industrial superpower. We discovered that it made a lot of sense to put these, create these ecosystems. Detroit was powerful, not because we made cars in Detroit, but because we made mufflers and brakes and tires and all of the components that go in the car.

Right.

It's the whole supply chain. And then we did the same thing in Silicon Valley. One of the things that I learned in the course of working on this, in 1965, Lockheed Martin employed 28,000 people in Sunnyvale. In Sunnyvale, 28,000 people. Can you imagine? And so you have to have the whole ecosystem. And then what happened in the 90s is China learned the lesson. They basically took all of the best lessons from America and they perfected them and they built these tightly integrated hardware ecosystems in China where you have whole cities that focus on drones or robotics or shipbuilding or whatever it is. And that's how they've been able to out compete us to the point where, what is it, China builds 10 million drones a year, and we built about 100,000 in the U.S. china built more ships in one shipyard last year than we have in the entire country since the end of the Second World War. You have these entire cities that specialize in production. And our view is that if we are going to compete, particularly in the high tech areas, we're going to have to replicate it.

What was the number of Lockheed employees in Sunnyvale?

28.

28.

28,000. Today it's at 3,500. Wow. Huge fall off. Incredible. Should we do a little bit of the history question I had?

Yeah, yeah. I mean he covered a little bit.

Yeah. I'm just interested to hear your take on, you know, what SpaceX is doing in, in Texas, what TSMC is doing in Arizona. There's a bunch of interesting projects that you're probably pulling lessons from. What does it take to get this right?

Yeah, I mean, I think we are so far behind that it's going to require kind of an all of the above approach. It's not here or Arizona or Texas. It's all of the above. I think there's an interesting question about specialization and one of the other things that I noticed is if you look at all of the breakthrough products that we've built in America, you can go look at Boeing 747 in the 60s, you can at look, look at Tesla Model 310 years ago or you could even look at some of the stuff that Anduriel is doing in Southern California. Basically all of the breakthrough products that we've built they scaled between 10 and 20 miles away from where they were invented. Right. The Boeing factory at Everett field was about 20 miles from R&D. Tesla Fremont was what, 25 miles from the HQ in Palo Alto where they designed it. And I think you could make a, I mean imagine Tesla ramping up Model 3 production. If the factory was in Texas, you could argue that it would have gone very differently.

Right.

They would never have been able to figure it out if you didn't have the tight integration between the engineers and the production line. And you can actually drive there and be there in an hour. And so the way that we think about the foundry is it's probably not the place where you put your factory that has 10,000 employees. It's probably not the place where you put your gigafactory, but it is the place where you go from having 50 people in Menlo park to having 200 people in your factory number one, to having 1,000 people in your factory number two, maybe 4,000 people in your factory number three. And then if you really, really hit it big and you're operating at Tesla scale and you have a factory that employs 10,000 people, then yeah, go put it in Texas or Reno or somewhere else. But it's basically a place for all of these companies to Scale from prototype to a multi billion dollar company and then also keep some of the cutting edge development close to the R and D talent. I mean even if you look at a lot of what Tesla and SpaceX are doing, a lot of the stuff remained in California. I mean the engines that go on Starship are still made in California.

Yeah.

What's the timeline for the foundry? Are you guys already working on imagining you're talking with a bunch of tenants already about potential leases? How quickly do you want to see people with actual their employees, boots on the ground standing up these factories, facilities, etc.

Yeah, I mean the current timeline is to break run in 28 and that's basically on track. So there's a local city called Susun that basically came forward and said, hey, we want to look at approving the entirety of the new city by annexing it into our city. That happened a few months ago. And so we are now going through the environmental work. I think they're expecting to publish the draft environmental report in Q1 of 26. But since we've announced the, since we've announced the foundry and actually same for the shipyard, we've had a bunch of companies come to us and say, hey, we would love to build here, but we really would like to break ground in 26 or 27. We have lots of orders, we need to make a decision. And so we're going to look at, can we work with the stakeholders around the table to accelerate it? Because it would be a shame to send another 20,000 jobs to Texas. By the way, very topical here. California just put out the numbers for unemployment. Last month we just lost another 7,000 jobs in the Bay Area. California now has the highest unemployment rate in the whole country. So you have this crazy juxtaposition of.

All the greatest economy, one of the greatest economies in world history, period. It's bigger than most countries and still this unemployment crisis.

Wild, Wild. Well, thank you for everything you do. Good luck. It's a huge challenge, but it's been fun following along and exciting to see the latest development.

We're going to have to set up our own.

I was looking at, I'm looking in the background, I'm seeing studios north right there.

Right behind me.

Right there. Yeah, right in the center.

Exactly. Good talking to you guys.

Awesome.

Congratulations on all the parties.

Talk to you soon. And if you're looking to visit California, find your happy place@wander.com.

Find your happy place. Find your happy place.

Book a wander with inspiring views, hotel grade amenities, dreamy beds, top tier cleaning and 247 concierge service, if it's vacation home, but better folks. And we are ready to bring in our next guest, Nathaniel Manning. Let's bring him in to the studio from the Restream waiting room, if we can do that. Nathaniel, how are you doing?

I'm doing well.

Can you hear me?

Yeah, yeah, can hear you fine. Good to meet you. Why don't you kick us off with the introduction on yourself and the company?

Yeah. Hey, I'm Nat Manning, everyone calls me Nat. And the CEO of Legend. Legend AI. What we do is essentially make Earth searchable. We want to be able to query Earth over space and time. So how do you do that? We have all these large language models out there that are trained on language. So if you were to want to find all the firebreaks in the Pacific Palisades, for instance, you can't really ask ChatGPT that because it's not in language today. It's not been marked. But the answer is that does exist. It exists in pixels that have been collected over the last 20 years in satellite imagery or drone imagery or low earth flying air. And you can train a model, a large Earth observation model on that data set and be able to begin to query the pixels themselves. So that's what we do.

Yeah. What are the data sources? I imagine Planet Labs and some other stuff. Are you buying data? Are you just. Just using stuff that's out there on the open web and fine tuning or kind of putting it all in a database? Like what. What is the market for, for satellite imagery look like these days?

The special part about this industry is a lot of it's made free and available. Depends on how you know how recent you want it or how high resolution. Then you have to go private. But you can train it. We train on Sentinel, which is from the European Space, and then there's a bunch of NASA out there as well. And we can train on all that. So we get to train on open data. And then when someone wants something that's either more high resolution or more recent, we can run our models and easily on top of that, purchase data as well.

Who's the ideal customer for this? I mean, I can imagine it being something I'm using personally, like every once, once in a while, but I imagine like it's more of a B2B use case. So walk me through the customer workflow.

Yeah, there's really three products in a stack that we're building. So the first is at the API level and I would imagine the kind of similarity there Is like live kit. Right. If you want to put audio into your, in your work today and you're building an AI product, you can work with a live kit or another one like that, similar that way if you want to be able to bring the intelligence that's in this data, which is arguably also one of the largest data sets ever collected. Right. So language is under 1 petabyte of data. That's, you know, all these models are trained on. There's almost 200 petabytes now of Earth imagery. Now the amount of imagery doesn't necessarily equal value, but it does kind of create complexity and possibility, I think. And so, you know, typical Earth observation market has been mostly government and defense and intelligence with agriculture and all sorts of kind of environmental, climate, supply chain, logistics, finance and insurance. Insurance is a world I come from. So those are, those are some of the key ones. And then as I said on the stack, it's kind of API level, which would be thinking like Google Maps, mapbox kind of kind of tools or lives.

In the open strategy here. It feels like they have a lot of data in Google Earth and Google Maps and there's a search box there, but it's certainly not powered by Gemini yet. But do you think it's on the roadmap for them or do you think that they, they're just focused more on like the consumer use case here?

Yeah, I mean Google's the big 800 pound bear in the room.

Yeah, big girl in the room. Yeah.

Look, they have, they have, you know, they have all the ingredients to make the stew. They also have like a lot of competition, a lot of focus. It's one of the reasons some of the investors we took on or were the founding team of Keyhole, which became Google Earth and Google Maps, you know, people who really arguably have made more from this in this space than like anybody else. One of my favorite stats actually was that and talking to them, learning that of the 200 billion in search revenue that Google makes, one third of it triages their location. Geospatial database. So that's arguably like the most successful tool in this space. Now that's location as well. And not just what's called geospatial, but yeah. So API level and then we're building an enterprise product as well. And then we'll put out kind of a fun consumer application as well. Kind of draw people's attention to what is now really possible that everyone's kind of dreamed about for years. This idea of being able to kind of query the Earth over space and Time, but the technology wasn't there until a few years ago.

Jordy, you have anything? I got another question.

Yeah, no, I was curious where you expect the most pull on the enterprise side. Is this like on the site you have a bunch of different use cases that feel really tied to insurance underwriting. Is that an area that you're excited about?

Yeah, that's where I came from as I started a company called Kettle that focused on. This is kind of how I came about to this, which was building. We trained CNNs on all sorts of imagery and weather data and build our own risk models and ended up going fully verticalized and sold insurance in California. And we built kind of our own models around wildfire risk and arguably I think built some of the best prediction models for wildfire and then wrote insurance. But the hard part with insurance is you need a giant balance sheet to be able to write it. And so it was hard to be in a position where you have product market fit so clearly like, so clearly saw that like there was going to be a breakage in the California market that you could do a better job using AI to predict this risk and then, and then just be kind of hampered by conservative mindsets and so.

But wasn't there also. What, what wasn't we. John. John and I live in two areas that were impacted by the LA fire. Fortunately, our homes were okay. But I had read that, that California had effectively had price controls by not allowing you to price based on risk, but only price based on historical loss rate. And then that changed in December. Like, I don't, I don't want to go on a tangent, but.

No, no, we can, I can, I can talk about all day long. And it's definitely one of the main, the main verticals we're focused on because it's one of the most kind of important data sets for underwriting, property underwriting. But in short, yes, the admitted market in California using Prop 103. Because Prop 103 basically says.

You have.

To kind of use historical risk, which in the world of climate change or any other kind of the how fast everything's moving right now, the last hundred years does not predict the next five years nearly as well as it used to.

And so.

But there is this thing called the excess and surplus market. So once you have three denials from the admitted market, you can go to the excess and surplus market and those rules don't apply. And so that market has grown at a, I think a 17% CAGR year over year for the last eight years in California.

Wow.

Because essentially the mid market's on strike saying like hey, and fairly so they're like, I need to be able to raise my rates, I need to be able to use models that actually work. And they struggled to do so. So I got a lot of sympathy for them. It's hard to be in that business.

How much demand are you seeing from people that just want to use AI tools to get cleaner and more data into a traditional geospatial database versus more of like an end to end AI solution where you're training on like the raw satellite images and then trying to, to kind of query that directly.

Yeah, a fair number. I mean what were the first customers, the people kind of doing this today? What you're essentially offering, what we offer is the ability to create. Aaron actually is kind of talking about this earlier on your show. The ability to create information out of or structured data out of unstructured data. So imagery is unstructured data. And kind of historically you'd have a stage one is you have an analyst look at it and you know, looking. Human eyes are pretty good at looking at this picture and saying, ah, that's a fire break and this is a neighborhood and that's a fire on the other side of et cetera or a forest on the other side. And then you would train a kind of stage two is you'd train a specific model, a convolutional neural net.

Detect all the trees, detect all the roads and then that's.

And you give it hundreds and thousands of images and teach it how to do that specific thing. And we spent millions of dollars a kiddo doing that. And that's kind of the norm today. There are tons of teams and it can multiple data scientists and an ML Ops person and a quarter or two to do one of these. So you're spending like half a million bucks kind of per query and because again it's just like convoluted data and it's across all those kind of industries we talked about. But what happened when you have the attention is all you need. You know a paper that came out, the transformer model. When you apply transformer model architecture to data, the output is embeddings, right? So you have these vector embeddings for language. And what happened over the last 25 years? You know, for 25 years keywords were the first order data object for making sense of language. And in the last two and a half years we've seen the process of it changing from that to language embeddings. And it's One of the biggest stories sort of in the world. And our take is the same thing is going to happen in geospatial data. For 25 years, it was map tiles or the pure raster data, the pixels themselves and that we're in the process of that changing to geo embeddings. And so our whole thesis, what legend really is, is the stack for managing embeddings, creating, tuning and storing them, which is the output of. Of these models on the raw data itself. And just that's the wave we think is going to happen for the same reason that. Because it's happening in language.

Very exciting. Thank you so much for stopping by.

Quick hit.

Happy to be here.

Do you have any news for us?

Yeah, we raised a nine million dollar round.

There we go. Very excited.

We got some great guys on it. You know, Kareem, your buddy Ryan Delk was kind of our first check in. So a lot of. Yeah, I've known Ryan.

Amazing.

The best.

Amazing.

Thanks, guys.

Congratulations.

Congratulations to you and the team.

Thanks for having me.

We'll have you back on soon and.

We'Ll see you soon. Have a good one.

Cheers. We have to pull a video up and react to it. Apparently some guys were made a video this morning that I will drop into for the production team to pull up. Here we go. They made a launch video. I think they're a company called Composio.

Okay.

And apparently we were featured in it. Oh, really? Well, well, they. They violated the derivative works clause. So they. Anyway, so let's watch it.

Let's watch this. This is the first time seeing this. We're reacting to stuff. Oh, there we go. Hello, my name is Jonathan Liu.

Today I'm launching Cupidly the Cursor for Dating. Let me show you how it works. So when you visit the site, you first enter your type. So let's enter my type.

Oh, this is Hinge Bench. We've been talking about this.

This is not the video that I.

Put and connect your profile.

This is. This is a. This is AI for Hinge Day.

Okay.

It scrapes your hinge.

Okay.

But it tries to do metaphor.

Not the video that I was referencing. So can you guys look in the. In the tab? Getting some audio?

Yeah, here it is.

Here it is.

No, not this one. Not this one.

This one.

Second, the first one. There. There's two videos.

Okay.

So first they violate the derivative clause and then I guess they drank. They had to tap out.

Okay, okay, okay.

Let's pull up the first one. I. We're gonna have to find out what that other video was?

Oh, yeah, that's a big viral launch. So someone launched AI agents. Yes. We should definitely talk to.

We're not getting video guys.

I mean, how could it go wrong?

We got into fucking yc.

Yeah, that was useful at eventually becoming nothing. Just like the agents we built. Fuck, Luli.

I wish our agents just worked. Beautiful cinematography.

I sometimes wonder what it'd be like.

If we had agents that actually were useful.

You're watching tvpn.

There we go. Crazy founders on our show.

They literally went from almost going homeless.

To an AI agent.

Unicrop.

No fucking way.

Our agents keep breaking.

How'd you fix that? We started using this new tool.

I saw this agent AI thing on.

Facebook, but it made no sense to me.

Your new agents are amazing. They just work. So how did you grow so fast? Honestly, our agents sort of sucked before.

We tried to build everything ourselves.

Then we started using the friend of the show. Composio. They're great. They allowed us to build these incredible agents last year.

We got reliable agents, ones you could.

Trust to code, test and ship this.

The other shift is bigger. Agents, agents, agents.

Teams aren't just working with agents.

They're managing swarms.

Yes, the putting work.

Handing off context.

Self correcting.

Tougher. There we go.

This is very, very drawn out.

Okay.

Fix your agents before it's too late. So Composio.

Very cool.

I'm pulling it up. The skill layer of AI, There was so much. Yeah, there was a lot going on in there. But pull up the second video now because it sounds like they've respected our.

They respected it in the video.

I saw tap water in the video.

They don't even need to do a second video. But they did. So thank you to them for respecting the derivative works class and paying homage. Homage.

I love how the team is able to deliver 20 hours of cinematic content a week. But if you get them, try to.

Get them to pull up a video.

Here we go.

Look at this cinematography. So many cuts. Wow. This is fantastic editing. Congratulations. I can't fucking believe it.

You already tapped out.

There we go. You love it. Great job, guys. Great job.

Fantastic. That's a fantastic full golden retriever.

Congratulations to them.

Love it. Yeah, we gotta have them on. They raised 29 million to build skills that evolve with your agents.

Okay, tomorrow we're having them on. We have slots. We will reach out. We'll make it happen. We have one more guest, I think Chris. Chris is still in the restream waiting room. Is that correct? That's right, Chris. Sorry to Keep you waiting. There was a viral video. We had to react to it. No worries. Thanks so much for hopping on. Thanks so much for the patience. Kick us off with the introduction. How do you know T.J. parker?

Yeah, T.J. parker, man. We went to Sunday school together, I think. So 25, 30 years ago. That's a good start. That's great, but no, TJ's a dear friend. We're both based out in Park City, Utah.

Oh, amazing. Amazing. And yeah, give us the introduction on the company, the news, what else is going on in your world?

Yeah.

So I'm Chris Andrew, co founder and CEO for Scrunch AI. We've built a customer experience platform for the AI buyer journey. Today we're announcing a $15 million Series A. Congratulations. Led by Decibel.

Thanks so much.

I had to hit the gong, and.

I mean very simply. Our belief 18 months ago was that all of search was moving to be AI search. Really. Like, we outsourced browsing without talking about the fact that we never wanted to browse the Internet. It was inefficient. We outsourced it. AI does it for us. And it means that AI visits websites instead of humans. And so we're building a company around that shift.

Okay, talk to me about the AI shopping journey. Recently. We're looking for gear for our studio. Basically always I wanted to build a mobile camera rig. I needed certain features. There are HDMI ports, this much battery life, this much. All the camera kind of describe what I want. It puts together a little shopping list. I send it to the production team. We kind of go back and forth. There are some links there. I don't think those are affiliate links yet. I feel like in the future there will be ads. But. But what else is important in terms of actually positioning? If you're selling a particular camera, how do you make sure that you show up and you beat it out? Because I kind of knew I wanted a Sony camera, but they could have sold me on blackmagic there. Blackmagic should have been hammering me. They should have been paying OpenAI to be like, hey, have you considered this Blackmagic one? And you know, the team likes Blackmagic too. So talk to me about all the different nuances that go into AI shopping.

Yeah, I think really, ultimately, all that Top of funnel, top of funnel discovery, kind of the 90% of the buyer journey, which used to be you, curating research from Reddit reviews sites based on pricing. We've trusted OpenAI and perplexity to do that for us. So, you know, they're basically running a search over a search index which is increasingly GPT's own search index. Prior that was based on Bing or Google or Brave. But they're looking at a list of websites identifying title, description, snippet, visiting the website, deciding if it's relevant based on the prompt that you ask. So it's basically trying to match the intent of a human prompt to content on websites to cite the sources that it deems relevant. So what we're seeing in the end is, is buyer journeys that are massively reduced. People are arriving on a website and buying the first time they're there. A lot of our Customers are seeing 2 to 4x conversion from AI search visitors compared to organic search visitors. And I think search and shopping will keep changing. Right. I just heard that GPT is, you know, embedding Shopify checkout in their feed. They're taking a cut of that checkout. I think it's, you know, 4% or something in terms of like another cut off the top. But today what's happening is AI is doing the research, citing sources and we as humans are clicking out to purchase and engage.

So how important is it if you run an E commerce website to go into Cloudflare and turn off that AI default? Because that seemed like Matthew Prince came on the show a great entrepreneur. He's certainly working in favor of content producers who might not want to be scraped and have their, their, their, you know, the hard worked blogs that they've developed automatically generated in, in AI search results. But if I'm just selling a product, I definitely want to be in search. So how is that landscape shaping up these days?

Yeah, Matthew Prince, another great Park City local. We've all fingers crossed he can buy the mountain. We're pulling for him and also pulling for him that, you know, content creators can get paid in AI crawling. I think that model makes a lot of sense for Cloudflare. Our customers. On the other hand, I think the 50 to 60% of the Internet that has a product or service to sell is desperate to bring content online to help AI understand their products and services. So we still come across Fortune 500 brands who have their site blocked. And so when I ask a question about that brand, what's the price, what's the product description? Compare it to xyz. It's going out to the open web to represent your product. So our customers are like my product and service is no longer what I say it is. It's what ChatGPT says it is. And if GPT can't access or can't effectively utilize your content on your website, it's going to pull from every other source that it can find on the Internet. So that's part of why we've launched what we call our agent experience platform today, which is essentially an optimized version of your website. So we take your website, we scrunch it, called our brand Scrunch, because we literally want to strip away everything on a site that is confusing the AI. These models don't read JavaScript. They struggle with carousels. They're not converting your multimedia into text. Large language models want language. So it's critical for businesses to be enabling the crawling on their site and making that content rich and accurate for the crawlers to access and pull through.

How is that actually different from just generic SEO? I feel like if I had a video, I'd want subtitles and text in like an HTML tag or something that just Google Search could pull up. Anyway, there was kind of like that keyword stuffing era. Dump a bunch of words in white text on a white background at the bottom, 1 point font or whatever. Are we going back to that?

No, I mean, I think we're actually moving more towards human language and intent. I mean, the keyword stuffing is a great example. If you pull up a recipe site, Google chicken noodle soup, you're going to find the word chicken 60 times on that page. So it's absolutely manic. AI wants the intent of the query. So, like, if you ask GPT for a recipe, it gives you the answer.

Right.

It kind of strips everything away and reduces it to what you want. So I do think we're actually returning to a lot of core SEO principles. You need language. Large language models want language. They're struggling with carousels and multimedia. They need that text. And so I think best practices in SEO, ultimately, my hope is we just call this search. We get rid of Geo aeo, aio. I ultimately think, I think all of search is going to be AI search and it's agents retrieving content for us.

Anything else, Jordy?

No, this is great. Thank you for joining.

Congratulations on the raise. We will see you.

Thank you very much. Thanks, guys.

Appreciate it out there in Park City. Give our best to tj.

Yeah, we'll talk to you soon. Have a good one. Bye. Let's rip through some timeline. Did you see the medieval knight raising a seed round of 500 gold ducats at 3000 Dukat's post and they already have their first LOI signed with the Holy Roman Empire.

Hard not to be bullish.

We must beat the Ming dynasty in the gunpowder race. What is this?

What is this video, by the way?

We gotta pull up this video.

Pull up the video.

I don't know if we can. This is gonna be hard.

This is gonna be a big challenge image right now.

But it is in the tabs. You might have to scroll way back. Loosely modified after the Tannenberg castle gun. Mine is loaded with a around 50 to 60 grains of 2F black powder and fires a 0.75 caliber lead ball heavy. Do we have the video? Can we pull it up? One second.

This is an OG2A enthusiast right here.

Yeah, indeed. And I love some founders Alt Edward is just like completely transposing this to the defense tech meme of like, we must beat the Ming dynasty in the gunpowder race. Like, you know, I've invented defense tech and this guy is firing some sort of a castle gun. I've never heard of this before, apparently from 1400.

So we should get one studio.

They had guns 600 years ago. Wow. I thought that was more modern. I thought that was like maybe 300 years ago.

But when was the first gun created?

Let's figure it out.

Appeared in China. The earliest firearms, known as fire lances, appeared in China around the 10th century. They were essentially tubes, often bamboo filled with gunpowder and shrapnel mounted on spears. So they would just made a lot of sense. You got a spear, you want to point it. You want some range, throw on some gunpowder.

Fantastic.

More news. Nudge raised a $100 million.

We got the video.

We got it. What are these guys doing, by the way? Like, what is this? What is this operation?

Who are these guys? Legends. That is so crazy. It is bamboo. It looks like it's bamboo. I don't know if it is, but insane.

Insane. Ben, get one of these for the studio. I need one.

Yeah, yeah, yeah. For next confetti cannon, we'll load up.

Yeah. With real confetti canon with. With.

Boom. Like shaking the whole thing every time someone announces a close seed round. Yes. Nudge, the brain computer interface company co founded by Fred Ursum, the co founder of Coinbase, says half the world will experience a brain disorder in their lifetime. At Nudge, we're building brain interfaces that are safe, precise and non invasive. To solve that problem, they raised $100 million in Series A led by Thrive Capital and Green Oaks. To go faster, we're hiring. Join us. Very exciting. Nudge, kind of the non invasive neural link. There's other news in here in the deck. NeuroLink just did two implantations in the same day. So they're scaling the actual implantation of the neuralink device. That of course requires invasive surgery. Nudge does not. It's a kind of a helmet that you put on, but then can stimulate the brain in different ways and solve a whole bunch of different brain disorders.

Very exciting.

This very likely could be the key to scaling from three to six hours a day, I think.

So live. Put one of these on. I mean, put it on. Turn off sleepiness, basically. I mean, like, once you get the different. It's literally like a tinfoil hat. Put it on and it can just be like, turn off fear. Upregulate risk taking. Go turbo long.

Yeah, mitigate. You want. You want capital alligators to be super risk on, but still get the weight loss benefits of. Of gop.

Yes, yes, yes, exactly something there. This is a wild leak memo from Dario.

Dario is basically justifying to the team why they're going to go directly to the Gulf to raise capital. And this is not something that probably should have ever been in a memo. He says, unfortunately, I think no bad person should ever benefit from our success. Is a pretty difficult, difficult principle to run a business on. Just blanket putting the Gulf states in the bad.

It's such a weird thing because you'd think you'd just be like, I met them, I dug in. I don't think they're bad people. And so I'm doing business with them. And let's debate that. And I think it's a Pareto improvement. Everyone is made a better off by anthropic working with the Gulf. That's the argument he should be making, but he's not, I guess. And so Dylan Patel says anthropic has been a series of ideological decisions later defeated by business realities. We've talked about this before where, you know, it was like all the, all the idealistic AI scientists were like, let's try doing this without capitalism. And then. And then the AI God was just.

Like, I actually enjoy capitalism. It's thrilling to me.

Thrilling. And I like 500 billion.

You're exactly right. The right way to do something like this is say I went, we visited, we spent a few days together. We have a shared vision for how AI can increase human prosperity totally.

Whatever the critiques are. I don't even know what the critiques are of the uae. I'm sure there's a bunch of both the UAE and Qatar. Like there are all governments and every company and every person ever. But you dig in, you figure out like, oh, yeah, how can we Work together to resolve any lingering problems. Should we have a different perception here? Just be like, I'm going into business. Someone I think is bad. Wild. Wild choice. Anyway, choice of words. In better news, Blake Scholl says at Mach 1.7, overture out flies Earth's rotation. That's cool. So you can have breakfast in London. Fly to New York for breakfast, and then to San Francisco just in time for breakfast.

This is going to be huge for the breakfast.

Breakfast. Max.

Folks, you ever been breakfast for dinner guy?

Pancake dinner? Yeah, pancake dinners. Let's do it.

Kind of insane. As a kid, that was mind blowing. We do that maybe once a month.

Cereal for breakfast. Four year old dying laughing at the concept of eating cereal for breakfast. Oh, it was the funniest thing.

Breakfast is so good.

It is.

And when it's not my favorite.

Really?

Yeah. I'm not a big breakfast guy.

I think. I think it's my.

Even. Even my default breakfast is like a breakfast burrito, which is really like lunch or dinner masquerading as breakfast, you know? Yeah, it's kind of like they've just kind of like swapped out.

I just remember as a kid, my dad making waffles. Dinner was so awesome.

Yeah. Yeah. Oh, it was amazing. Do we have the Tyler cam working? Can we. Can we check in with the final review of the Tesla cafe? How was the experience?

How far?

How far? How long did it take you to get there from here?

It's like five minutes away.

Oh, it's really close.

Super close.

Oh, wow.

Okay.

We could probably walk there.

Okay.

Yeah. Did they. I wonder if they did that on purpose.

We didn't get the invite to the opening. Other influencers there yesterday we were behind the ball. We had to go.

They know we're always live.

Yeah.

Yeah, it's definitely cool.

Like, the building is super cool. There's a ton of stuff on the menu. It's just like a diner.

So that's cool.

I mean, there was like. I don't know, there's like hundreds of. Not hundreds. There's a lot of things on the menu with like every kind of meal.

Yeah, I think it's open 24 hours. 24 hours. That's cool.

So maybe, you know, we go back later.

Do they have steak?

Try something else.

Do they have steak?

They have dinner.

I don't know if they have steak.

I guess you just get a burger when look.

Yeah, but so we took a Tesla, like, to get there and then. So when we parked, you could see on the menu.

Wait, how did you take A Tesla to get there.

Adam. Adam has a Tesla.

Oh, it's one. Yeah, got it. Okay. It wasn't a. It wasn't like a Robotaxi because the robotaxi is rolling out really aggressively. But it's not in LA yet. But this feels like, kind of tied. They're teasing. They're. They're testing the waters anyway.

Yeah, I think the burger was.

How's the food setting? Are you feeling still good or any upset tummy?

I feel pretty good right now.

Okay.

Yeah, it was cool. I wouldn't go back just for the burger, but maybe I would go back.

Would you.

Would you go back and do a mukbang and eat every item on the menu in exchange for an iPhone?

In exchange for an iPhone?

Yeah. You would eat every item. You would. Would try and eat every item on the menu during 3 hours? Every. Every item. You have to eat them all?

Yeah.

Like 7,000.

What do you mean by every item? Like, is it a burger and a burger with bacon?

I saw a graphic that had like 12 different items on it, and so it would be. It'd be 12 different meals, basically.

Yeah. Three hours. He's a growing. He's a growing boy. He's a growing boy.

I've never been in the competitive eating. I think it's a little voluntary. I think we'll come up with a better challenge for you. You will win the iPhone within the next few weeks, but we got to.

Come up with something.

I wouldn't want to put you through the mukbang. I think it's probably a little bit too aggressive, too hardcore on your body to try and eat all that food.

Three hours, though. Three hours.

Three hour show starts, you do the mukbang.

I gotta be here.

Yeah, exactly.

Anyways, we have a post here from Jira Tickets. He's been an absolute regular recently. Feels like he's on every other day. Ah, yes. Good morning. Let's open up the Infinite Information river for a nice 20 minutes before getting out of bed or thinking any original thoughts at all.

I love it.

So real.

I. Because I wake up so early and I race over to your place and then get in the car. I haven't been opening the Infinite Information river first thing in the morning. I haven't been doing anything other than just get. Actually, I go outside. I go outside and I get sun. Who were we talking about that with? Maybe Huberman or something, but Rob. So I've been doing that and I don't know if it's really been that much better.

Sometimes the light that Blasts your eyes from your phone is the best alarm clock.

And when you open up your phone and you're greeted with a post like this, just kicks you off to, like, a great start of the day. You're just laughing.

You're enjoying it. If Elon could pin this to the top of the feed that we're having a great time.

You're having a great time. What else is in here? Oh, yeah. I mean, we do have the post about somebody built cur dating. We got to talk to this. This fellow spent his life.

Can we pull up the video now? I was super confused earlier, but we.

Made my life savings on this cinematic video because I have no VC money to burn. Did one shot. Very funny. And then digs into AI agents for Hinge. The AI agent goes and. And scrolls your hinge profile, does all the swiping, all the talking, and then surfaces, matches that it thinks you're actually interested in matching with. So kind of like a layer on top of hinge, I suppose. Yeah. Let's pull it up. Let's see it. I mean, the cinematography, fantastic for the first couple seconds, and then it gets a little silly. Hello, my name is Jonathan Liu. It's a cool shot. Cool shot.

Today I'm watching Q L demo the cursor for dating. Let me show you how it works. So when you visit the site, you first enter your type. So let's enter my type.

What does he say? I can't read that.

Then you would go ahead and connect your profile.

Does. Does he? It's funny that he's censoring Hinge because it's obvious after doing that, you click.

The big black button that says searching for people. Your type. And this launches an AI agent that swipes for you on hinge, filtering for people.

Why is he censoring it? Everyone knows. And then also, it seems like he's harnessing Hinge in some weird way, because I don't think Hinge has an API. Tyler, do you know if Hinge has an API?

Not that I've looked, but I don't think there is.

Okay. Because I imagine that they would not want this to happen. They don't want bots in their network whatsoever.

Thinks you're a good match. And, oh, this picture's pretty cute.

The LY is really coming back.

Either send a message using AI.

Yeah, it was a real throwback.

Yeah. And then you send a message using AI. That's wild. I don't know what this is a stunt for. I don't know how serious he is about this. But, but I mean AI dating clearly going to be something there. This is an interesting go to market. Maybe it's controversial. I mean you got 10,000 likes, million views.

Yeah, I think the, it's very clear the dating apps don't want people building experiences on top of them.

Yeah.

And they will try to own this type of experience. But we're talking about it, we're talking about it. It sounds like a successful launch.

Well, we gotta jump, we gotta film an ad, close it out with Mike Krieger, co founder of Instagram at Anthropic. He says today I'm excited to share that I'm joining figma's board of directors. Having known Dylan for years and watched him build the platform that's become essential for design teams, I'm looking forward to partnering with him and the FIGMA team on what's next.

Fantastic pickup heading into the ipo. Couldn't have found a better person to join the board.

So congratulations to everyone involved in that last one.

Close. Close. So investments is not calling a top here because of AI yada yada yada. But White House eliminates day trading regulation, poly market returns to the U.S. robinhood enables 24.7EU gambling. The architects of the 2022 SPAC bubble are posting CNBC guys have a crypto treasury play Wall street bets, meme crashes 40% and almost close closes negative. I don't understand that if we blow up later this summer. Can't say there weren't signs.

I mean the benefit of like.

And what he says is. All I'm saying is what is going on is pretty crazy.

Yes. I mean the benefit is that if no one's saying this, then you need to be really worried because at least people are saying this and then they're thinking it and then hopefully people are pulling back before you get to a feeling.

I feel like in 2021, 2020 people were saying this is crazy.

Yeah.

Was he saying all insane is what's going on? Pretty crazy.

Pretty crazy. Pretty crazy.

Hyper capitalism.

We'll see. We'll see.

Gotta love it.

Anyway, thank you.

Last, last but not least, Hope. Hope.

Oh yeah. Hope's Revenge.

One of the top posters in the world topping the power ranking. Originally said, my GF is upset because her favorite albino alligator was bought by Anthropic and ruined. And then he actually has a picture here and it says the care of Claude the alligator is generously supported by Anthropic.

I think this is great. I don't see why it's ruined.

I love to see Big AI supporting alligators.

Yes.

And I actually want to get. I'm really excited for BCI's brain Computer interfaces to get into the alligator category. They're pretty wild. I mean, just pull up a picture of an alligator. These things are insane. The fact that they're just cruising around.

No one's working humanoid alligators like robotic alligators. Maybe that's the killer for everybody saying.

Oh, you guys could do incubations.

I feel like, I feel like a robotic alligator would be a good defense tech play too.

Yeah. I mean there's a lot of investment in bears.

Yeah.

Robotic bears.

Yeah. You let the robotic alligator can sneak under stuff and swim, jump up, run, attack the terrorists wrists.

Yeah.

Attack the enemy.

Seems like an alligator. A robotic alligator with drone based wings so it could actually fly while snapping.

Could reshape the modern battlefield. Could be looking at billion dollars home defense play too.

If you had robo alligators on the roof and you had somebody breaking.

I'm big into moats. I'm big into moats. What am I gonna put the moats.

That's right.

Alligators.

That's right.

Yeah. And there's to be some upkeep costs with maintaining a fleet of robotic alligators, but probably less than how many, how many chickens or cows you got to throw in the moat.

Exactly.

If they're real alligators. So, yeah, we're trying to. I think more single family homes should have moats.

Yep.

Right. We're always talking about businesses, talking to founders. What's your moat? What's your moat? Meanwhile, we're sitting in houses that don't have moats and I think that should change. So lots of, lots of opportunity in Alpha here at the end of the show.

Fantastic. Have a great day. We will see you tomorrow.

Cannot wait. Have a great evening.

Cheers. Bye.