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You're watching TVPN breaking. The US government now officially owns a 10% stake in Intel. The poly market jumped to a 99% chance. This, this broke over the weekend.

They didn't think Uncle Sam could get an allocation.

They didn't. You know, this is technically Intel Series A. They did a seed round of 2.5 million on convertible debt in 1967.

Convertible debt.

Convertible. Vintage Arthur Rock. Not the anonymous poster, not our fur Rock, but Arthur Rock, the OG and, and then they raised 6.8 million in 1970 and that was their IPO. So this is their Series A, in my opinion.

Anyway, back then, back then, even if you would, you would round down, right?

Yeah.

Like if it was going to be 6.9 million.

Yeah.

The very Elon code.

Yeah.

To go with that number.

Oh, yeah, yeah, yeah.

Close.

Yeah, yeah.

Decided, hey, let's round down.

We don't need to keep it classy.

Let's keep it classy.

Yeah. So over the weekend, the Wall Street Journal reported, President says US will take big stake in Intel. President Trump said the government is taking nearly 10% stake in intel, capping a two week frenzy in Washington over the future of the company and fueling speculation about what else might be done to help the trouble. Chip maker Trump said in the Oval Office Friday that the company has agreed to give the government the stake as part of discussions about the company's future and billions of dollars in grants it has received. 2022 Chips Act.

Intel's drawing, to be clear, I don't think they've actually received it yet.

They've received 2 billion already.

Okay.

But there was something like, something like roughly 10 billion, maybe 11 billion in, in grants and then another equal amount in loans for an Ohio facility. And those are going to be rolling out and they should draw, and intel should be able to draw down on them, but they could always be rolled back if something changes and the CHIPS act kind of goes away. And so this is all the art of the deal. This is the. And so it's very funny the way Trump phrases it. He says, I said, I think you should pay us 10% of the company. And they said yes. Which is not typically how people discuss equity investments.

Government grants too.

Yeah, yeah. Well, people just don't. People don't say, pay us 10% of the company. Like a VC will come to you and say, hey, I want to invest $20 million and I want a 15% stake in your company.

In exchange.

In exchange. And if anything, you know, I would ask for that stake or I'm trying to build towards that stake. I want to build a position in your company, not I want you to pay me, but that's the nature of this thing. So there's, I mean, we've all been tracking this. There's been a little bit of back and forth between Lip Bhutan and Donald Trump. He originally called for the, for the resignation. We can take you through the timeline. The Wall Street Journal laid it out really well in an article. A deep dive that we'll go through. But let's kick it off with this Howard Lutnick. View Video let's play it the art of the deal Colon Intel. And this is from Howard Lutnick sitting next to Lip Bhutan in a beautifully appointed room. If we can go full screen here, that'd be great. I'm sitting with Lipp Bu in my office, and at 3 o', clock, we're going to sign a document together in the Oval Office where the United States of America will own 9.9% of the great American technology company Intel. I can't be more excited for America and for intel that we get to work together.

Well, first of all, thank you so much, Secretary.

And this is big, important historical agreement that we can work together.

And then more important, I don't need.

The grant, but I really look forward to have the US Government be my shareholder and we can work together.

Have you ever heard what happened is.

Lippu became the CEO of Intel and he came to see me and he said, you know, the Biden administration gave this company a grant of $10 billion, and we don't need a grant. We're a great company. Maybe not with the best leadership, but now it has leadership.

This video is absolutely insane.

He said, you know, and that was the conversation. And then when we had the conversation with the president, he said, look, we don't want to take your money away from you, but shouldn't it be fair? And we agreed it would be fair.

That the same money, they're blogging deals.

America should have shares for it, because it's just bad. And we agreed together. And then you went to your board of directors and they agreed. Yes, it's a giant public company, so it had to be fair. Had to be fair. Had to be fair. There's no other way. And so we did it fair for intel and for the American people. And I think this is exactly what Donald Trump is all about. I'm really excited that today we get to do the deal. That's right. Thank you so much for your support.

What's that?

Is that a Botched handshake. What happened there?

Whoa.

Wow. Lipu went for the dap up and Lutnick hit him with the power shake. The power shake. And it just was botched. Interesting, interesting.

Ben, can we put that in slow motion? Play that back. Well, the Journal has a timeline here. Lip Bhutan was anxiously preparing for the biggest meeting of his life. Just five months into his tenure as chief executive of Intel, Tan was already fighting for his job. A few days earlier, Donald Trump had demanded he step down over his past ties to the Chinese military. The demand sent to Intel's leadership. The demand sent Intel's leadership into a panic. They immediately contacted the White House for a meeting, and Tan flew to Washington, huddling with advisors for hours. On Sunday, August 10, his team reassured him that the President would hear him out because, quote, Trump loves meeting with CEOs. Who doesn't? Even those whom he has attacked publicly, according to people with knowledge of the conversations.

Yeah, yeah, he's been fought in wwe.

This is wwe.

He understands. You call out your opponent, you hash it out on the field. Yeah, it's good.

The next day, Tan met with Trump Commerce Secretary Howard Lutnick and Treasury Secretary Secretary Scott Bessant in the Oval Office. He sought to convince the President that he wasn't a Chinese spy and that the US Government has a long term interest in bolstering intel, one of the only homegrown manufacturers of the computer chips that power the modern economy. The CEO's argument proved persuasive. The President also took a liking to Tan, a Malaysia born, Singapore raised US Citizen who once considered a career as a professional basketball player, and backed off for the CEOs ouster.

Or lip, though.

Can we get a Tyler, can you actually try to find a highlight reel?

Can you generate an image of Lip bhutan dunking on LeBron James?

But the truce came with a cost. In return for Trump's support, the administration proposed taking an equity stake in the company.

Company.

It's interesting, in that video they framed it as Lipp. Bhutan was like, you know what, we don't need the money. Why don't you take a stake? Yeah, maybe. You know, it's kind of unclear who.

Made the initial move both ways. So just for context, last year intel brought in $50 billion in revenue, but they lost 18.8 billion. So they did not do well on earnings. They missed on bottom line, essentially, just a little bit. Just a little bit. And they switched CEOs. Obviously they've struggled on the founding side, the foundry side. They're not making chips for they can't find customers for their foundry stuff. So, you know, if that continued for a really long time, yeah, they would need the money, but they technically don't. And you can just look at the, you can just look at the stock price, like before any of this. Like, it's not like intel was trading as a penny stock. Like it was still, it was too rich for Elon to buy with the, what was it, 40 billion that went into Twitter, Something like that. I remember thinking like, oh, I would prefer if he bought intel potentially, because that one seems important, but, but it's always been around $80 billion company. And so, like, if it was truly on the brink of bankruptcy, the shares would be falling even more, in my opinion. So I think Libu is not being disingenuous there. They actually could get by without the money, but they would. They need to restructure like very seriously. And Liputin's like doing that. Like he's cutting a ton. He's going to. And if you cut everything that's not additive to that 50 billion and you just try and hold onto as much of that 50 billion in revenue as possible and you cut everything, that's losing money. Yeah, you should wind up with something that actually generates, I don't know, maybe $10 billion of free cash flow.

Not a bad little business.

No.

Intel decided to convert nearly 9 billion in grants promised intel as part of the 2022 Chips act into a 10% equity stake in the company. An unusual arrangement that makes the government Intel's biggest shareholder. Meeting was a pivot point in a frenzied period for intel, once one of America's most venerated technology companies, now stuck in a years long downward spiral. The company scrambled to control the fallout from the President's demand that Tan step down. Ton, triggered by a Fox Business Network segment, underscores the unpredictable environment major corporations face under Trump. By the end of the two week roller coaster ride, Ton's job appeared to be secure and the company's situation more stable. Japan's SoftBank Group agreed to invest 2 billion. Seeking to curry favor with Trump. On Friday, intel and the White House on Fish officially revealed the terms of the deals. He came in, he saw me, we talked for a while. I liked him a lot. I thought he was very good. Trump said of Tan from the Oval Office. I said, you know what, I think the United States should be given 10% of intel. And he said, I would consider that. Yet a host of questions remain.

This might be the gong of the day. This might be the True size gong moment.

This is the fundraising hit. That gong.

Congratulations.

Clean first hit of the week. It's good to be back.

We're calling it 1600 Pennsylvania Ventures.

Yep.

White House Capital Group.

White House Capital Group. Tan must resolve core business challenges to get his company on track. Some analysts say intel isn't in a much better position without new commitments from customers. Converting government grants to stock will only leave the company in a worse financial shape. By diluting shareholders, Trump will likely need to find more ways to support intel not wanting it to fail on his watch. And that's why this is.

And that's why Lubu Town's genuinely excited.

Yeah, because now you're in. Trump is effectively the SPAC sponsor of Intel. Yeah, it's a new era.

Yeah. He has bags and so he's aligned. And so if Libertin needs to come to him and say, hey, you know, we're trying to make this a facility in Ohio, it's not going well, we need you to put some pressure on.

We need to line up some customers.

We need to line up some customers, all sorts of things. Like in terms on the board, he's value adding. He. Trump is a value added investor.

He's got audience. Yeah, he's got, he's got, I mean, he's got his own social media tech giant.

True. Could be a potential buyer. You know, maybe Truth Social becomes a hyperscaler. Yeah, you know, it's happened before.

True. Truth Cloud.

Truth Cloud.

Intel needs a lot of help and the US needs Intel, says Goodrich, a senior advisor to the think tank Rand, who focuses on tech issues. Hopefully something good is going to come out of this.

We had Jimmy on the show like two days ago.

Yeah, Jimmy. Jimmy. Good work, Jimmy. Intel was founded in 1968 by semiconductor pioneers Robert Noyce, who co created the modern computer chip, and Gordon Moore, originator of Moore's Law. The idea that computing power and chip efficiency would likely double every year or two, a guiding principle in the tech revolution. By the 90s, intel dominated the market for processors used in personal computers. Its Pentium line and intel inside marketing campaign with dancers and multicolored clean room suits made the company a household name. Then came a series of tragic missteps. The company largely missed out on the mobile phone and artificial intelligence booms by overemphasizing short term financial targets. Analysts say rivals in chip design like Nvidia and manufacturers such as Taiwan Semiconductors surged ahead. It's interesting how you, if you're a huge tech company, you can miss maybe one platform shift and do fine. But you miss two, you're going to be even. Even Microsoft said we miss mobile. We gotta get into social media and LinkedIn.

Yeah, you could. It's a really, really stretched metaphor, but you could say that like Nvidia missed mobile more or less. They weren't really switching into. Okay, let's be the design arm of. Because the iPhone.

You were buying enough chips for your gaming edition.

Yeah, yeah, no, it was just gaming company at that time. Mostly in scientific computing a little bit. But there is a graphics processing unit on mobile phones. It's just part of the system on a chip that goes into the phone. And it was never. Nvidia never really like figured out a way to get a piece of mobile. And there's a world where like the cloud rendering stuff happens. But Nvidia kind of sat that out, but it didn't matter because they, they crushed AI.

So company is still as keen to reviving US manufacturing.

Nvidia sales. This is sales by quarter. And it's just like. And this is what a 30 year old company is, just completely, completely right. Looks like a YC demo day.

Looks like a ramp.

It's crazy.

The company is still seen as key to reviving U.S. manufacturing. In his first term, Trump touted Intel's plans for $7 billion manufacturing plant in Arizona. Trump advisors began discussing what became the CHIPS act, wanting to attract companies such as TSMC to the US Has Arizona.

Tried to brand like what they're doing? They have so many different chip manufacturers coming in Arizona. They need like Silicon Desert or something like Chip city. Chip city. It really feels like like there, there is a significant center of gravity. Yeah. That will ultimately become like a company town type vibe.

Chip city. As discussion on the CHIPS Acts crescendoed during the Biden administration, Intel, Pat. Intel CEO Pat Gelsinger lobbied aggressively, hoping for some of the law's tens of billions of dollars in subsidies. In 2022, he sat in the first lady's box for the State of the Union speech, during which President Biden touted Intel's investment plans. While the bill was being negotiated, senators including Bernie Sanders and Elizabeth Warren pushed unsuccessfully for a version that would see the government receiving equity in companies it backed. Very interesting. This is what Mark Cuban was saying last week. He was saying this is Sanders and Warren's dream. He said it in a little bit less PG language correctly. But intel became the law's biggest beneficiary, qualifying for roughly 11 billion in grants and about 11 billion in loans for a plant in Ohio. An expansion In Arizona and other projects, it seemed like a boon at the time, but the law's slow rollout and Intel's core business challenges led to repeated delays.

About ROI there, like, like Lip Bhutan saying, like, you know, we don't need these grants. And I think he's like, technically correct, but it's incredible nice to have. And the ROI on your CEO going to the State of the Union and just sitting in a box and, like taking some meetings and, you know, I don't know what Intel's lobbying budget was, but it probably was less than 10 billion, right? It was probably less than 10 million. It probably wasn't very much at all. And you get a huge friend of.

The show, Andrew Ross Sorkin said yesterday, should the government start taking equity in every startup for the federal tax incentives we offer? Or Tesla? How about the banks? How about when a state government offers a tax incentive, should they get an equity stake in exchange board representation? This is a super slippery slope. And Bill Gurley said, here's my take. If the government is the quote, unquote, lender of last resort, they should take 100%, take equity. And arguably 100% of the equity. Failed to do this with GM, Goldman Sachs, United and other airlines. How do you know if they are the lender of last resort resort? The company takes the deal, which.

Because otherwise the company would go with a financial investor who says, I only want 50% for the same price or whatever. And so it is a good. It's a good point. It's a good point by Bill.

So in reference to the original CHIPS act grants, the Journal says it seemed like a boon at the time, but the law's slow rollout in Intel's core business challenges led to repeated delays. Late last year, Tan, who had been an intel director since 2022, left the board in protest of Gelsinger strategy. The board also soured on Gelsinger and pushed him out. Trump's victory presented another curveball. He had bashed Biden.

Quitting in protest. Deeply underrated. Deeply underrated strategy. Just in life. Yeah, yeah, I respect Tan for quitting in protest and then ultimately getting back.

For the top spot.

It's pretty sick. Pretty underutilized strategy.

Yeah, just. I'm out, he decided, basically in the trough of disillusionment. He quit in protest. And then he said, yep, I'll pop back on the roller coaster for the slope of enlightenment.

That's where intel is.

And we're really. Yeah, I think we're. I think. I think we were.

Who's. Who's on the slope of enlightenment. I thought we were doing three colors. Me, you, Tyler.

I didn't get Tyler on there yet. But you're on. You're. You're just.

I'm just.

You're just coming up to the peak.

I just went to San Francisco. I mean, this is talking to AI researchers. They told me deep learning is undefeated. They told me that pre training scaling will continue. And so I'm, I'm. I have yet to my infl. My expectations can continue to be inflated.

I am looking at the trough.

You're looking at the trough.

Looking at the trough.

You're going headed straight. Tyler, where are you?

I think I'm where Jordy is too.

Okay.

The red one.

Down slope. Wow. I thought you were so AGI pilled, bro. I thought you're so AGI pilled.

But I mean like, okay, even Dwarkesh. Dwarkesh is extending his timelines. Like, how can you. I mean, it's hard to still be extending the timelines.

Just means that the initial innovation trigger slope is just going like this. But he's still. He's still going up. He's still going up and to the right. He's happy. Who's that?

Expectations are worse. Yeah, Y axis expectations.

I don't know. I don't know. Let's just sprint to the plateau of productivity. The real move is that I don't think we're in the trough of disillusionment yet.

How about. How about I think we need to make the TVPN version of this for the AI hype cycle.

Yes.

And the slope of enlightenment. We need to just like another vertical line. Another vertical line for the fast takeoff scenario.

Yeah. It's like we get a bubble, we get a crash, and then we get a fast takeoff. That's the most likely for sure. No, our job is to recognize and diagnose when we are in the trough of disillusionment and re illusionize people such that we can get to the slope of enlightenment.

I've never been in a trough of disillusionment that didn't one day get to.

The slope of enlightenment. Exactly.

So there's always hope. There's always hope.

Yes.

But anyways, you know what could have.

Made that video better? If it was streamed on restream.

That's right.

Live one livestream, 30 plus destinations, multi stream and reach your audience wherever they are. Lip Bhutan, Howard Lutnick, if you're listening, get on Restream. Anyway, continue, Jordy.

Of course. So Trump's 2024 victory presented another Curveball. He had bashed Biden's implementation of the CHIPS act, fueling worries that he could try to change deals or cancel them altogether. Intel's financial condition worsened and the incoming administration worried the company might fail. Even with the recent share price rebound in August followed by reports of the deal with Trump, the company is now valued at 110 billion, a fraction of its dot com bubble peak. The stock is down roughly 50% since the start of last year.

Wow.

Intel has has been left behind, Trump said last Friday.

So round Trump's inauguration in January, Lutnick and administration officials began evaluating CHIPS act recipients and which tech companies generally could increase their US Investments in line with the President's goals. They asked semiconductor companies receiving CHIPS act awards to increase their total US Investment. But they knew they might need to revamp Intel's deal or help the companies in other ways. What's interesting there is that when we talk to like all of this is like, like everyone's doing art of the deal on each other. And meanwhile, like when we talked to Doug o' Laughlin at Semianlysis, he's like, realistically, like, all this trailing edge capacity is going to be done in like South America. Like it doesn't make sense to do it in America. Like a lot of this stuff is just going to wind up getting offshored because it's easier to build some facility that's just copy pasted down there. And so it's very unclear like how like how it can actually work in the long term. And then, and then on the leading edge, like it seems like it's TSMC and Samsung, like Tesla's going with Samsung and those will be in the United States and those will be like cutting edge, like PhD level jobs, amazing researchers, like really, really great, like American innovation. But like we're kind of already on that path and Intel's not really the party that you need to be twisting the arm of. It feels like if you want America to be like the leading semiconductor country, you just need to make sure that you have leverage over TSMC and Samsung. Not so. And maybe AMD Global Foundries a little bit. I mean, Global Foundries is part of intel now, but, but a lot of the, a lot of the trailing edge, like it seems like it might not be a long term thing that America is ever good at again because it's like it's commoditizing so rapidly. I don't know. Anyway, clearly Trump cares about it and wants to keep it here. So that's what he's pushing for. The Administration began early conversations with Intel' board about taking an equity stake. The talks didn't move forward in part because the board, which has often been mired in disagreement, wanted more than the administration was willing to give.

Did they want him to take take a bigger position?

No, they probably wanted like 40 billion in grants or something like give us more for that. Former banker Lutnick has had in recent months asked other tech executives what can be done to help intel, even asking other chip companies like TSMC AMD in Micron whether they would consider potential deals.

This is what Doug is. Doug has just generally wanted people with semiconductor manufacturing experience to be involved with the company. And so it's very possible.

It seems like a step in the wrong direction, according to his heuristic, because it's like more government people on the board. But I mean, to be clear, the US Government is not taking a board seat and not having a controlling stake. It's a purely financial stake which we'll get into. So in March, Intel's board named Tan, 65, as CEO. One of the biggest decisions he faces is whether to keep the company as one of the few chip firms that does both design and manufacturing. Some analysts say intel should consider splitting the business or doing other types of deals to cut costs. Tan has so far shied away from spinning off the manufacturing segment, which lost 3.2 billion in the second quarter. He has told confidence he has inherited a very bad hand. In July, intel said it would lay off 15% of its workers by year end, cancel billions in planned investments and further delay work on the the sprawling Ohio plant. The new rules of the road were no more blank checks, Tan wrote in a memo to employees. Tan's early decisions at intel were aimed at getting the company on more stable ground. But the CEO's past work at chip design software company Cadence Design Systems thrust the company into the spotlight in late July. July, Cadence agreed to pay $140 million for violating U.S. export restrictions by selling banned technology to a Chinese national defense university. The sales happen. Tan was CEO. So you know, you like it seems like he probably had to sign off on that in some way. Of course, it's like, is it a university? Is that like, I don't know. I don't know how you like steel man this or dig into like, you.

Know, steel manager, you're the steel man.

Champion of the world steel manning. It would probably be like, the export restrictions are just like super complicated and it's unclear. And it's one of those things where it's like, there's the spirit of the law and the letter of law. And they made some case for, you know, in this particular, in this particular technology did not fit within the export restrictions because the export restrictions might just be like, you know, oh, chips of a certain size or scale. And they had, and they had a chip that was like slightly under. And then they, and then the government like, you know, reinterpreted the export restrictions to include that. Like this stuff happens all the time. Because when these, when these export restrictions get, get, get written, it's easy to crazy.

You don't hear much about Cadence Design Systems, by the way. Huge company, $95 billion public company.

Yeah. And that's why people think Louton so equipped to run intel because he took that company to like 100 billion market cap basically from I think like 5 or 10 or something when he, when he, when he joined the company. So he is, he's a talented operator. So. A week later, Senator Tom Cotton sent a letter to Intel's board raising concern Tan's ties to China. Trump was watching this is wild. Trump was watching Fox business network on Aug. 7 when host Maria Bartiromo highlighted Cotton's criticism at 7:34am Eastern Time. Five minutes later, Trump fired off a message on his Truth Social platform. The CEO of Intel is highly conflicted and must resign immediately. It's crazy. He's just watching the news and then posting about it.

Journal says it was one of the first times in modern history that the president publicly called for the leader of a major company to step down. Trump's demand was seen by some on both sides as an opening bid in negotiations with the CEO. The president had already grown intrigued by the idea of government stakes in key industrial companies during his May trip to the Middle East, a senior White House official said. Though the official added that it wasn't what sparked Trump's post. The president wants to see more such deals in the future.

Well, if you're trying to maintain compliance, get on Vanta Automate compliance, manage risk Group trust continuously. Vanta's trust management platform takes manual work out of your security compliance process and replaces it with continuous automation.

Whether you're pursuing your first, I imagine that will be. We know that Trump is not going to be on the board and not going to be sort of directly pulling the strings on the business. But I imagine one of the first things he wants lip to do is implement Banto.

Yeah, for sure.

Yeah.

So intel stock price has been on a tear shout out to Leopold Ochsenbrenner at situational awareness.

They mocked Him. They mocked him. They said this guy's fun. Must have already blown up.

Yep. Oh he's a weird non consensus bet. Oh well it paid off. So the question there mid August then Trump met tan SoftBank invested 2 billion and the share price rose from under $20 to over $25 a share and the deal has been announced. So anyway sorry I cut you off.

No, I think people were speculating whether Leopold had some inside information or he just viewed intel as a super strategic asset.

There was some post about this the.

Government wouldn't possibly let fail.

There was some guy on X saying like oh this is like insider trading. Everyone is insider trading. Even like Warren Buffett made his money on insider trading. Very black pilled and and so we just been like there's no evidence of any of this happening at all. And and yeah. Wait, what you got Tyler?

I think also like this trade like him being long intel totally aligns with the thesis of the, of the fund situational awareness. Like his whole thing is he's going.

To monitoring the situation.

Yeah.

They're going to nationalize like AI.

Oh yeah.

So obviously like if the US is going to nationalize like start a lab, start like building compute and stuff they're going to have like they're going to take the existing infrastructure.

Yeah, yeah. I hadn't even thought about it from that perspective. I was just thinking about it from the perspective of we talked to Ben Thompson about Intel, we talked to Doug o' Laughlin about Intel. We were kind of like noodling on it back and forth as commentators and I didn't come away with a super strong bull or bear case. I didn't really look at the stock price or the valuation or the financials but it didn't seem like crazy to come up with a like a, like a, an expression of your position enough in financial terms and it's very clear that like Leopold and his team just like looked at intel more deeply and saw that there was an opportunity there. You don't need. Not every good trade needs to be inside of trading people. It's like so ridiculous. And yeah, I mean it's the same thing. Like it's like what does he know about Nvidia? Like is it possible he just, he just knows that like he's not in Nvidia. What does he know? Is he insider trading or is he just looking at like oh well Nvidia is like the obvious bet. So everyone piled into Nvidia. It's like the biggest company in the world. Maybe not a lot of Juice left there. I'm going to go where I'm going to go and bet on the things that have high upside potential and yeah, I don't know anyway. In the Oval Office, Tan told the President his ties to Chinese businesses were years in the past and he was loyal to the United States. He presented ideas for turning intel around and investing more in the United States. Lutnick told Tan that he thought it was dangerous to have so much of the global chip making capacity controlled by foreign companies. Tan agreed and reiterated that he was dedicated to Trump's America's first manufacturing agenda. By the end of the hour long session, the President was convinced and agreed to lay off the criticism.

I will no longer call for your immediate resignation on my social media app, Mr. Mr. Tan.

That's great.

Tan and Lutnick then move quickly to hammer out a deal for the government to take a minority stake in Intel. It was complicated negotiation because it was unusual to convert government grants that had already been awarded into equity. While they were in talk, SoftBank, led by Masa, suddenly agreed to put 2 billion into the company, part of its campaign to bet on US Firms and appeal to Trump.

If they, if they were putting together like a pitch deck for SoftBank, I feel like they should have used Figma for that. Yeah, think bigger, build faster. Figma helps design and development teams build great products together.

I would be shocked if SoftBank uses Figma for the design of their decks because they seem to be very PowerPoint coded, but they still are powerful. Imagine how powerful they could be if they would simply get on Figma slides. Let's see here.

Did I tell you that my first internship ever was at a SoftBank backed company?

No way.

Yeah. Drdrew.com, so Dr. Drew was a radio host with Adam Carolla on Kiss FM in 2005.

Wait, that's crazy Lore.

Yes, this is insane lore. So Dr. Drew was like a board certified psychologist, psychiatrist I think.

Wait, we're pulling up this website by the way.

And so Dr. Drew, during the dot com boom wanted to start his own livestream property basically and raised money from SoftBank and built a team of engineers and had their own data center racking servers. And one of my jobs was like, well I mean this is like what it is now because he has like and you don't really need like necessarily like a venture backed startup to be an influencer, but went to the same high school as me and.

Every single famous person has gone to John's high school.

Yeah, it's wild, but yeah. One of my, like, you know, pop by the summer office was like, go in the data center. And it was like, super cold. It was like, not like a data center. Like people think today. It was like a room with a couple racks of servers. But there was no aws. So if you wanted to set up a website, you had to like, rack a server and like, put the code on the server and then run it.

Just put the servers in the bag, bro.

Yeah, the brand was a little bit different back then. The first show that they were gonna greenlight was this sort of like. It was about a lot of his stuff was like relationship coaching. So Loveline, people would call in about their relationships. And so I believe they were gonna put two people like a man and woman who were maybe dating, and they were gonna go on a road trip and they were gonna like, live stream it and it was gonna be like some sort of like, new, new media.

Well, all I can see is. I can see why Masa needed to be in that website.

John, it is. It is incredible lore.

Is that part of how you underwrote the internship too? You're like, look, you know, I wasn't.

Really, like, technically an intern. I was so young. I was just like stopping by the office, basically. But. But it was cool. It was like a true startup environment. Like a pool table. Like, pretty big office. Very much like.

Pool table.

Yeah, pool table.

Amazing.

It was very iconic of like, you don't see pool tables in office now. It's like ping pong tables. Yeah, they've taken over.

We should. Do you like pool?

I like pool.

Okay. We should get a pool table back here.

Billiards.

Billiards, yeah.

Yeah. It was like the classic, like, kind of overfunded ventureback.com bubble company where like, huge staff for something that, like, would ultimately be small media company. So. Yeah, yeah, a media company that should focus on like the media piece and then. And then like the YouTube should just be like a platform. And so it's like. It's like it didn't make sense to be in, like, the middle. You either just wanted to be like the influencer or the. Or the platform anyway, so.

SoftBank had already pledged to spend at least 100 billion in the US on AI and other tech investments, a move announced by sun at Trump's Mar A Lago club last December. SoftBank had also earlier this year discussed a potential deal to acquire Intel's chip manufacturing business. Intel and the US soon agreed the government would use 8.9 billion in grants that have been committed but not paid to take a nearly 10% stake at a slight discount. The US won't have a say in governance. It already gave Intel 2.2 billion in chips, acts, grants. That was what we were talking about earlier. Some had been given, but not all that was promised. David Shapiro, a former partner on the Wall street firm Watchdoll, Lipton and Rosen and Katz drew up the terms, including a provision that the government could acquire another 5% of intel at a discount if the company sells a majority of its manufacturing business.

Underrated naming scheme. I really wish startups would do this. Like, the next AI startup should just be like, no, this, Haze and Cosgrove.

And this could be totally a new meta. It can only be done once.

Yes.

By a great team.

If we did Coogan, Hayes, Cosgrove and Kohler, it would be amazing.

I mean, at some point we should just add the whole team.

The whole team. Yeah.

We could definitely get the dot com last names Coogan and Hayes and Cogsgrove and just over and over and over. So the administration insisted on this provision as 5% at a discount as a type of poison pill meant to dissuade the company from fully exiting the manufacturing segment. And this is what people are really excited about. You know, government involvement in the decisions.

Of.

Highly technical projects.

Highly technical, complicated businesses.

Government famously good at building things.

Yes, yes. So if intel were to give the government another 5%, it would obviously dilute shareholders and complicate things. So despite the initial optimism, many analysts say the agreement will only be a boon for Intel. If Trump can also find customers and attract more investment for the company. I think he's going to be able to do both, to be honest. I think he's going to be able to strongly encourage other companies.

He's not going to be like a VC that just like, sits back and like, reads the investor updates.

There's one thing, one people can criticize Trump for a lot of things. But he is available the week of August 25th. He's online. While many allocators. He's not a Burning Man.

He's not a Burning Man.

Which is crazy. Which is crazy. You'd think that he's starting to get into Venture.

Yeah.

That he would naturally go to Burning Man. Set up an Oval Office camp at Burning Man.

But instead of being at Blackrock City, he might be at Blackrock.

That's right. Doing deals.

Doing deals.

That was one of our good. There's an early episode of TVPN where John and I are riffing out Blackrock City, the home of Burning Man. And wondering if there's a connection.

Almost certainly a connection connection to BlackRock.

Financial institution SoftBank's 2 billion and the 8.9 billion in government funding that had already been promised aren't game changing for the chip manufacturing business in the grand scheme of things. It's not.

It's so crazy. They lost 18 billion last year. Like we're not even covering last year's losses. But better to have and not need, I suppose.

Yep. So the agreement is fueling speculation that the President could lean on other tech companies to work with Intel. Lean, strongly encourage demand that they are fired. They are not. If they do not, he's going to rip some posts. Tan has met with potential customers, including Apple CEO Tim Cook, trying to win support for Intel's next generation manufacturing process. This is not the kind of thing I see Tim being super interested in. He's like more expensive, less performant.

Apple has spent what, a decade getting off of intel and Intel Macs and going to Apple Silicon, which are like so integrated, so perfect for the Apple ecosystem. Now you can run iOS apps on Mac and vice versa. There's a ton of. They've been spinning up the ecosystem on top of Apple Silicon for so long, the different graphics engines and getting developers to go deeper into optimizing for Apple Silicon and then they just rug it back on it.

Yeah. So the Journal says many executives say they would need big incentives to use intel for manufacturing given how badly it trails industry leaders like tsmc. It is difficult to switch semiconductor manufacturers because the processes are specialized and have to be planned out years in advance. The government stake in intel is the latest in a series of extraordinary interventions in the private sector.

What's the craziest thing that they could do like Apple GPU for a cluster at intel or something like kind of fresh start. That seems like something way out of their wheelhouse of both companies. I have no idea how they would do that. But I mean if, if Amazon can do Trainium and, and Google can do TPU at tsmc, like maybe there's a world where that happens. I don't know. Anyway, Global Foundry is punching the air right now.

Anyway, the administration, they highlight a couple of the other deals worth covering to. The president won a quote unquote, golden share of control over Japan's Nippon Steel in return for allowing it to take over U.S. steel. These golden shares are in reference to what the.

Oh, I thought it was in reference to the President's toilet, which is gold.

Yes. And many, many of the fixtures in his in the Oval Office yes, but. And last month, Trump struck a deal with Nvidia AMD for the federal government to take 15% of their chip sales in China in return for allowing the exports. In early July, the Defense Department took a minority stake in MP Materials, a maker of rare earth magnets. Days later, Apple, which the Trump administration had long pressured to expand its U.S. supply chain, announced a $500 million deal to buy MPs products.

Yeah, so that's an example of like Trump, like acting as, you know, biz dev basically for the companies he likes.

I mean, he's really going to make a lot of VCs look bad. Oh yeah, Big promises during the deal process when they're trying to win allocation and then kind of.

I'll help you ramp your revenue for sure.

Yeah, I'll help you.

I know a lot of the top guys. I know a lot of the top guys.

I know a ton of founding engineers. I don't have 50 other portfolio companies that also want to hire founding engineers. I got you, I got you. But the intel stake is among the most notable given. Trump called for Tanda to resign, then quickly brought him to the negotiating table. There's this Darth Vader aspect of the whole thing, said Gwantam Makunda, a lecturer at the Yale University School of Management. Never heard of it. Who studies innovation and leadership, referring to the Star wars villain who started as good, became evil, then redeemed himself. Anyways, do you want to read through.

This post from the big question is, is this socialism?

MAGA socialism?

Is this MAGA socialism? A lot of people have been saying this and I mean, I think like my default take is that, like, I don't know that intel is so critical that we need necessarily a backstop. I don't necessarily that the government is the right board member.

You don't trust Doug on this. Doug really doesn't want Doug from Semianalysis, really does not want intel to fail.

Yeah, I don't know. I'm still like on the fence about it. But so the debate has been raging like is this socialism? And so we're going to the socialists who are self proclaimed. The people's line from Carl Beher and Carl says no, but that hasn't stopped Democrats from complaining about it. And this is interesting because obviously the Trump camp is very pro this deal and they're saying this isn't socialism. What are you talking about? We're just doing art of the deal. We're making good deals and this is an America first agenda project. The Democrats are saying, oh wow, Trump is a hypocrite. This is socialism. The socialists are saying this isn't socialism. It doesn't go nearly far enough. It doesn't count as socialism because it's not a controlling state. Carl says former under Obama, Undersecretary of State Rick Stengel is freaking out right now over the news that the Trump administration has taken a 10% equity stake in chip manufacturer Intel. This is a quote from Rick Stengel, Trump. Trump's strong arming intel for government equity is something Mao and Stalin would be proud of once the GOP believed in laissez faire capitalism and government not interfering in the private sector. Look it up. Up the state owning the means of production is called Marxism.

So, Carl, I couldn't find any evidence of Elizabeth Warren or Bernie Sanders taking a victory lap on Trump's acquisition of intel shares.

Yes.

Which was surprising given that back in the Biden admin era they were pushing for this.

Yes. But the key discussion that's going on right now is is financial ownership versus true control over capital. And that's what Carl's gonna get into here. So he says. Anyone old enough to remember the phrase Government Motors this is from the era of the takeover of gm should be able to appreciate what a wild line of criticism this is to hear from a former Obama official. As part of his Troubled Asset Relief Program TARP, Obama took for the US government a 61% equity stake in General Motors. And the rights backlash was entirely predictable. Rush Limbaugh called this a sterling example of the left's crusade for government control of business that proved the left's enchantment with socialism. John Stossel complained that this was a move toward more government control of the economy. And in the end, that's pretty close to socialism that so many liberals have adopted this line of criticism. Joe Scarborough took it up on Thursday and Democratic consultant Jessica Tarlov ran with it on Friday, for example. Should probably provoke some reflection among socialists who think of liberals as fellow travelers. While socialists may share certain egalitarian values and other priorities with contemporary Democrats, American liberals are still reflexively ambivalent to hostile toward the basic socialist agenda of nationalization. They will opportunistically support it when it's time for Democrats to bail out the economy, but they will aggressively attack it if they think. If they think this will score points against Republicans. There are a few things that contemporary liberals enjoy more than catching a Republican doing something that they can rightly or wrongly construe as social. As in this case, I would say wrongly. Stengel's definition of Marxism as state ownership of the means of production is confused for all kinds of reasons. But here are the most salient that. But here the most salient is that ownership does not imply control. Even if this was ordinary equity, 10% would hardly give the government any kind of significant control over the company. But as intel made clear in a statement, this deal doesn't even give the government 10% control.

Quote the government 9.9%.

But no, no. So there's more. The government's investment intel will be a passive ownership with no board representation or other governance or information rights. The government also agrees to vote with the company's board of directors on matters requiring shareholder approval with limited exceptions. So this notion of passive ownership perfectly illustrates why socialists would do well to talk about control rather than ownership of the means of production. A major function of modern finance is to sever the relationship between those. To identify control, you have to look past the legal and business terminology and figure out who actually has the final say over any given lot of capital. In that light, it isn't clear that 10% ownership stake even represents incremental progress towards control of intel, which is what the socialists want. Convincing a business to give you a 10% non voting stake in their company is very different thing from getting a 10% voting stake, let alone a 51% voting stake. Nevertheless, American partisans clearly aren't interested in litigating the fine details between ownership and control. And that's why socialists have an interest in this fight. Fight. If Democrats are going to vilify Trump as a socialist, the best response is to complain that he isn't even doing socialism.

He's not doing enough.

He's not doing enough. And so my takeaway from this is that it's a good point. It is not the goal of socialists. But at the same time it reaffirmed that I do not want to do the socialist thing here because I don't want the government voting on what intel should do. I don't think the government's equipped to make the decision on how they should position against tsmc where they fit in. Apple Silicon versus TPU versus Trainium. It just doesn't seem the government's set up to actually run this company more effectively than anyone else. And so I'm very hesitant about that. It sounds like something that's like very good in some abstract sense to the socialists, but I have no faith that if the government were to get a 51% voting stake in intel, that we would get a better outcome here.

Well, the better Outcome people were talking about this on the timeline would be Trump answering questions on earnings calls.

That would be fantastic. Maybe that's, maybe that's the case.

That's a good outcome.

Yeah, but it'd be odd to have like, I mean, if we went to pure direct democracy and socialism. Like you go to the ballot box and you vote. Like are we going to do 3 nanometer, like decide. You decide like yes or no. Like I think it's, I think it's a waste of money.

Or just have the, whoever's the intel CEO just have that as, you know, an elected, basically official.

Yeah.

Like let the people vote on who should be running.

Yeah. I mean the question is like, how much democracy do you want? You can vote on everything. You vote every single day. California is extremely democratic. We have ballot measures for all sorts of things. We tend to not do ballot measures for different, different things. At the federal level we have a representative democracy, not a direct democracy. But if you really play out the direct democracy socialism thing, it's like, yeah, you'll be voting on whether or not intel launches a gpu. Intel, like, hey, we miss mobile. What should we do about that? Okay, let's ask the American people broadly at the ballot box. That is the conclusion.

Should intel launch energy drinks? Yeah, it's not really in our wheelhouse today, but. But big, potentially large opportunity.

Yeah, it does seem fraught. It doesn't seem like. It seems like there are.

It's potentially one of the slipperiest slopes that we've ever been on as a country.

Well, I don't know. This is saying that his point is that this isn't a step towards real socialism because it's not real control. It's purely a financial instrument.

Yeah, but the intel board said the government also agrees to vote with the company's board of directors on matters requiring shareholder approval with limited exceptions.

What are those exceptions?

So what are the exceptions? Right. I'm not sure. Not sure that we know. But anyways, the timeline, if the analysis.

Says it's a bad idea, we can vote against you. That's the exception. Anyway, first step, I would vote for. If I was in a democratic socialist society, I would vote that intel gets on graphite.dev code review for the age of graphite helps teams on GitHub ship higher quality software faster. Get started for free.

Canor in the chat says, I think intel needs to launch short form content.

Well, make sure your voter registration is up to date because President AOC might just make it happen. You never know.

I could see It. I could see it possible.

I mean, the real wild one is, yeah, Tesla. Because Tesla's had a number of government incentives that they've taken advantage of. You could make the same argument. You put the screws to them and you say, hey, we need voting shares.

For this, for the years and years.

This is what Governor Andrew Sorkin was saying. He was saying, where do you stop? And I understand that, yeah, there is this slippery slope. But to Bill Gurley's point, Intel could have said no. They could have said, yeah, we're actually going to be fine without the chips act money. So we don't want an equity stake.

Although Lip Bhutan is sitting there just on fire. And you should be like, you don't need to help. You don't need to help put it out. I'll be good, I'll be good. The flames, like, no, I'm good, I'm good. I don't want to give more. I don't want to give the president the ick. I'm just act all like, Hey, I.

Mean, BlackBerry is a cybersecurity company now. Maybe intel just like pivots all the way down to just like, yeah, we actually just own real estate at this point. All we own is we're real estate and we just lease to tsmc and that's it. We're completely out of probably decent business. In other news, Taylor Swift is getting married.

The private jet enthusiast.

Well, I feel like most of our audience would know her for her Wall Street Journal op ed in 2014, where she said, for Taylor Swift, the future of music is a love story. Where will the music industry be in 20, 30, 50 years? Before I tell you my thoughts on the matter, you should know that you're reading the opinion of an enthusiastic optimist.

One of the few enthusiastic be there.

Yeah, One of the few living souls in the music industry who still believes that the music industry is not dying, it's just coming alive. There are many, many people who predict the downfall of music sales and the irrelevancy of the album as an economic entity. I am not one the of them. In my opinion, the value of an album is and will continue to be based on the amount of heart and soul an artist has bled into a body of work and the financial values and the financial value that artists and their labels place on their music when it goes into the marketplace. Piracy, file sharing and streaming have shrunk the numbers of paid album sales drastically. And every artist has handled this blow differently in recent years. You've probably heard the articles about Major recording artists, artists who have decided to practically give their music away for this promotion or that exclusive deal. My hope for the future, not just in the music industry, but in every young girl I meet, is that they all realize their worth and ask for it. Music is art, and art is important and rare. Important, rare things are valuable. Valuable things should be paid for. It's my opinion that music should not be free. And my prediction is that individual artists and their labels will someday decide what an album price point is. I hope they don't underestimate themselves or underestimate or undervalue their art.

So did she get this right to date? Not really.

I think she got. The thing that she got right is that what an album is can be extremely monetized if you continue to think about what the album is scarcely. Like, you either have it or you don't. And the Internet kind of reduced that scarcity to zero because you could stream it, you could pirate it, but there is still scarcity to be created if you are an artist, if you are a musical artist. And so the way she does that now is when she releases an album, she goes on a tour that becomes so big that again, there is scarcity because there are only so many tickets at Sofi Stadium. And you have to be there because it's a moment.

One of the best monetized recording artists of all time.

Yes. Yes. And so she gets the long tail eventually. And eventually her music is essentially free and played in grocery stores.

I'm gonna read you something from their Instagram caption announcing the engagement.

Yes.

It's not just a marriage. Dash M dash.

No way.

The perfect love story.

No way. No way.

Back on X is calling this out, saying, claiming that Taylor Travis are one shot.

It. No way. What you got, Tyler? Was that.

Oh, well, I was gonna say something about like her like monetization. Like Kyla Scanlon has this good post. She said Taylor Swift's engagement is actually very relevant to monetary policy because she is the most powerful stimulus tool we have.

Oh, really? How so?

Well, I mean, her tours are like, like massive. Like you can see the like rise in consumer spending.

Yeah. Oh, interesting.

Especially like smaller countries. It's like very.

Yes, yes. But, but how does her being married, like she could just go on tour and be single, right? Is she going to sell more tickets because she's married now? Does it allow her to tour more?

You could also see it in. A lot of people are talking about birth rates, right? Maybe a new boom.

Yep.

Baby boom.

Yeah.

Boyle just posted a picture and just said amerit with the cat. Caption captioned their pictures. Pictures just said American dynamism. I do think this will be good for the birth rate. It's also going to be some. Some for anybody that's in a longer term relationship in their late 20s, early 30s. Pressure is now on. These photos are going to be getting sent around. They're setting a new bar. Right. Quite the floral display by Travis. Gotta give him props there.

How many, how many kids do you think she'll wind up having?

She's 35.

She's 35.

She's gotta get going. Oh, yeah, 1980 and hopefully a ton. Right? I mean, I think we'd like to.

See luxury status symbol, apparently.

Like to see at least 10.

Yeah, it'd be great. Oh, wow. Wow.

Looking sharp.

You really understood this. You said you were just gonna do a phone call and now here you are.

No, I thought I'd full monty here.

Because this is amazing. Okay, so first off, I need to apologize. I completely botched the story of drg.com in my defense, I believe I was 10 years old when I stopped by the office as a kid. But please break it down for us.

It's so funny. The only thing I found disturbing was how miserably you did with my credentials.

Oh, I'm sorry, I'm sorry.

Let me start with that.

Okay, please.

I'm a physician. I'm a board certified internist. I'm a board certified addictionologist. I'm a fellow with the American Board of American College of Physicians. I was an assistant clinical professor in psychiatry. Practiced medicine my whole life. I'm not a psychologist. Okay, yes, we did do Loveline back in the day.

I love Loveline. I. I sincerely love Loveline. I wish I listened to it constantly. It was amazing.

Well, it was very popular and it served a function back in the day. But this, this business spun out of it. I thought you guys would really like to hear this history because it is a piece of history.

Incredible.

Good friend of mine from high school, Polytechnic High School.

Yeah.

We went off to Amherst College and then he went to Harvard Business School. I went to medical school. And I'm going along, doing all these wild things, practicing medicine and then doing radio. And he shows up and he goes, I want to show you how to form a business. We're going to do a dot com company. And of course I was hearing about all the dot com stuff in the wind. And he'd got some seed capital from a company in Orange county, like a million dollars. And then he Put together a little board and we went. He grabbed me by the arm and took me up to Sandhill Road and we sat at Softback Softbank rather, and made him. He just said, follow me. I go, what are we doing? What do we create? I had no idea what we were doing. Didn't know how to start a business. I didn't.

You had, you bought your dot com, by the way, had you like gone.

Out, probably had done something it like that at that point. I don't think it's sitting there without that.

Yeah, exactly.

And, and he just goes, follow me. And I was like, okay. So I followed along and they go, what do you want to do? And I'm like, you know, so I, I don't remember what I said, but the 6 or 7 SoftBank VC representative marched out of the room and my Harvard Business School friend was anxious and like I didn't even understand what was happening. Still, I did not. And they came back in and they go, okay, $10 million. That was that.

Let's go.

We went down and we built the company exactly as you described. And in fact drove my wife crazy. She goes, what are. Why aren't they working there? It shouldn't be this nice an environment. But most of that was for the tech team. And you pointed out how weird the tech situation was. You got that part exactly right. But the point you got wrong is, remember, people didn't have any idea what a website was. And so we had an editorial staff, we had a medical staff, we had a marketing team. And they envisioned. I kept saying, why do we need a magazine on my computer screen screen. Why you're, you're building this really great magazine, but with a chat room and with some feedback. And they kept the, all the, all the, all these sort of trigger words back then were interaction.

Sure.

And, and I didn't understand. I saw no value in any of it. I kept saying, I, I kept saying we had 120 employees and we had a board of directors from, from Northern California who were demanding, we quote, get big fast. This is interesting.

Get big fast.

This guy, this I first board meeting, I said, look, I'm trying to decide if we should figure out how to make money, how to make this profitable or what we should be doing or how to.

They tell you, don't worry about that. Don't worry about that.

Worse than that, this one guy goes, he was manic as hell and he goes, if I thought you were so stupid, I never would have been on this board. And he jumped up and he goes, here's how you make money A dot com company. And there was a giant whiteboard and he wrote in huge letters, letters get big fast. And they were demanding we burn through capital faster to try to get big fast. So that became the weird. It was the weirdest thing I ever seen in my life. But the one thing I got right, I kept saying, it's going to be video. Why else do we need this thing? It's going to be video. But look what we're doing right now, right?

Yeah.

And I just kept saying that. And we put together a one night a week television show that was really a high quality show. We still have some of the tapes from it. And everybody came in, Paul Rudd, Tommy Lee, everybody came on that one night a week show because it was the cool thing to do because there's this new idea, this.com company creates a TV show and nobody could watch it. You know why?

Because you couldn't stream it.

Because nobody had stream. Nobody had broadband. Broadband. You needed broadband back then. That's, that's how far ahead of the technology we were.

It sounds like you weren't making a ton of money, but were you selling the show on a subscription? Like what, what did that was.

Was there any business model or like any revenue ads? No, just eyeballs. But so, so get big Fast didn't mean revenue or profits. It meant eyeballs.

Eyeballs get big meant money. Ben number of people. And they kept talking about how the cur. You know, how the asymptotic curve would develop around, around viewership and engagement and this kind of stuff. And we literally, this was a company, I mean it had lots of traction and engagement and stuff. People were kind of intrigued by it. So people were stopping by and looking at this thing. I'm not sure. We did lots of interviews with celebrity. It was sort of like E meets Teen, B meets, you know, it was all these different types of things all together in one site. And we literally were sitting in Goldman Sachs on, I believe it was March 19, 2020, 2010. When was that? The day the NASDAQ fell apart. The day we were sitting in Goldman Sachs and the woman across the table was contemplating giving us $30 million on a $110 million valuation for a company that had never made a penny.

Wow.

And I just thought it was the dumbest thing I ever saw. But I knew it was tulips the whole way. And I kept. And one friend of mine finally goes, look, it's Amsterdam 1680. It's tulips. You're going to grow Brussels Sprouts or are you going to grow tulips? What are you going to do? I thought, all right, I'm going to grow tulips.

Well, it's interesting to think back and if it was structured as an investment that was actually in you and your name and likeness, it would have been a tremendous investment. But that wasn't a good dot com story.

It was why we got the money, though. In fact, there's a. There's an ink article on my wall here. I was going to actually pull down and wave in front of the camera, but it'd be almost impossible to do it where that they were sort of saying that's what they were. You know, that's kind of what they were thinking they were doing. But it was not. It was not a clear thought. Thought. But they were looking for brands.

Yeah.

And I don't think they really knew that. That was not a fully developed thought at that time.

Yeah. So what was the conclusion?

Like going to business school, I saw the entire, the entire from. From seed to dissolve. I saw the entire business cycle in one year.

So did you, did you eventually take. Take over the site again yourself or what?

Dr. Koop brought. Bought the site. Remember Dr. Coop, you wouldn't. You're too young. He was the Attorney General and then he had a website I. That actually did rather well for a minute.

Did he just redirect the website or was he still using DrDrew.com?

No, no, he was a redirect absorbed everything and. And he went bankrupt, as everybody did.

Yeah.

And we got. We were able to weasel it back. I forget how we got it back, but we had to do some sleuthing and we finally got it back.

So. Yeah. How did the show shape of your business evolve then? And like what, like how do you think about packaging everything that you do now?

You know, there, there's. I was listening to you guys talk and I was thinking, boy, I don't have any framework. This is all very interesting to me, but. But I don't have a framework to sort of understand what I do. My stuff is always an improvisation.

Sure.

Right. When I started radio in 1983, I know designs on radio, I just, I was, was leave me alone so I can practice medicine. I'll come here in the evenings on Sunday and do community service. That was my little notion in 1983 when I started doing radio. Then some television guys came along. I'm like, how do you do a TV show? I've never. I don't even know what you're talking about, well, this was the same thing with the dot com. My good friend comes to me and goes, we're going to do this. And I thought, I, I, I don't see it, I don't get it. But I think we might be able to do something with it. It'd be interesting. It was a hell of an education. And you're asking how I frame everything I do now? Now?

Yeah. I was wondering, well, it's just been.

Interesting how many different technology friends from the dot com to podcasting, but it all comes back to basically radio and tv.

Yeah. Like over the past, you know, more recent tech boom history, have you been hit with the hey, let's do, let's do a Dr. Drew or let's do an AI thing thing. Is this coming? Is it rearing its head again?

That has been, that has been. I've had conversations like that.

Yeah, of course, of course.

Exactly. What to do with it. Nobody knows.

Nobody.

Right. But it's part of the exploration. I'm doing streaming shows regularly. You guys blasted them up there. It looked like hell.

Wait, where you put it up there?

I'm going to talk to my webmaster.

I mean, it looks really good for conversion optimization. It made me want to click. I think, I think your person's doing a good job job.

Not meant to be shown at other people's shows, but, you know, that's been interesting. It happened, that all happened just because I got canceled for daring to say people shouldn't panic about COVID Oh yeah. And that caused me to just stop doing everything. And I had somebody who said, hey, you should do a streaming show. I was like, what's that again? That's sort of my, it's where I start every one of these projects.

Yeah.

You had a bad experience streaming the first time, where you're like, if I make the show, you're sure people are going to be able to watch it.

But, well, more confidence this time.

I knew it. I already knew that. I already, I saw what was happening with videos. I just kept, we just kept saying we were so early. We just, we could have been who knows what. We could have been you. God knows, we could have been YouTube or something if we had sort of been the first to really advocate for this kind of platform. But we were way early and nobody else was quite as much of a believer as I was. And, and so the streaming thing has been very interesting and I'm in my own, my kids playroom doing this and it's the same thing. Everything here used to require me to Go out to a satellite booth at cnn and now I just do it from here. So the efficiencies are fantastic. And so I do television out of the studio. I do podcasting out of the studio. I do streaming shows. And it all started because I got canceled. And some. My webmaster said the streaming is probably gonna happen pretty soon. I said, let's try this, that. And I wanted to talk to all the people, other physicians who have been canceled. One of them happens to be the director of the NIH right now. And so I just had the sense that these people had something to say and the cancellation thing was some sort of bizarre aberration, certainly in science and medicine.

Had you. Have you gotten the opportunities that you maybe lost due to the cancellation? Have you gotten invited back in the last last year?

Or is it just a different set of opportunities?

Or is it. Yeah. Are you looking at totally different? Or do you not even want to go back to the. To kind of the old.

Those are great questions. I. I don't know that I want to go back, but I probably would because I've taken the position that my opinions have never changed. I'm happy to express them on any platform anywhere. What has happened in the meantime is, you know, what I used to do, say all the news outlets, all of them. All of a sudden, the only people that would have me on was fox.

Yeah.

Now, just last week, CNN called. So I thought, okay, good. This is a good sign. I couldn't make it, but I would have had I been able to.

Nature's healing.

Nature's healing. Yeah.

We've been really obsessed with this idea that sort of a barbell is emerging in modern media where all the value either accrues to the platforms like YouTube, Twitch, Instagram, or the individuals, the Joe Rogan, the Andrew Huberman, and that it's very hard to actually build anything in the middle. Would you agree with that? Would you. Is this something that you've kind of experienced? It feels like something that.

No, I. The. I absolutely concur with the. On the talent side.

Yeah.

That. Because it used to be, I would require. To do what we're doing right now.

Yep.

There'd be an executive producer, there'd be a segment producer, There would be a director in the studio, in the satellite booth, there'd be somebody directing in the other end, at the satellite booth, there would be.

And then you got the union, the.

Unions involved with every unions, every sales forces, there'd be executive structures. Now it's me.

Yeah.

That's it.

Yeah.

So it's so much more efficient and it drives that world crazy.

Yeah.

So when Colbert gets, gets fired for losing $40 million a year, I just looked at that and I go, well of course. Yeah, that's gonna happen to all of them. This is just not a. Yeah.

Our reaction at that point was he could just go set up his own home studio and probably have a fantastic business just with his existing fan base and none of the, none of the overhead.

100%. But they are, they are. You got to know how that world thinks. They're very spoiled. They're very spoiled and they're used to gigantic infrastructure and dozens of writers and this is the, this, the world we're living in. Right as we have this interview to them looks sort of cheap and dumb and people aren't talented do that. The real people, people back. Back us with infrastructure and money. That is just not. So this the other side of the barbell, which I'm wondering how you see it. I just see it as largely non viable. So much of it has got to shrink dramatically. And it's resisting. Yeah, it's resisting like crazy.

Yeah. I mean I would almost put, put the traditional media corporations like in the center. When I think of the far big mega side of the barbell, I think of the platforms, Spotify, Facebook, Meta, YouTube, Twitch, LinkedIn, the networks and they actually accrue a ton of the value. And it is extremely hard to start one of those companies. And if you do, you're not talent at all. In fact, you're probably an engineer and you probably at this point have the backing of like a state government because that's the only way TikTok got going and was, you know, so much energy and capital flowing in to actually, you know, break through. The ship has sailed on starting like new platforms for the most part, in my opinion.

I think that's probably right. And there. And they don't need to buy talent.

No, not at all. It just comes to them naturally and they give 50% of the revenue or whatever the.

Yeah, we would rather, we would rather just have you jump on our show from your studio and you benefit because people are going to, to trickle over to you and, and, and we don't.

Have ads and we just get to.

Focus on making content and not, not focused on talent management.

But the interesting thing is you, you have to wonder is there. Are we somewhere in a business cycle that's going to lead to some consolidation and when the talent consolidates, are they going to start negotiating with the platforms? Is there going to be some Sort of. I mean, that would be a natural business cycle, right?

Yeah. What was that new left wing subs stack publication that just announced? They said they're libbing out or something. Remember this?

Yeah. What are they?

Anyway, there's like a collection, the Argument. So there's a new publication that's launching that's aggregating a number of writers who are sort of on the left. And we were kind of debating will they have leverage over different platforms because they're all together, or does it actually make more sense for Matt Iglesias and Derek Thompson to just have their own substack and go direct and then, you know, and then on the far other side is the. Is the platform and there's really no one in between. But we're still early in the. In this development of the Argument.

There's something very strange. It says there's a weird confluence of worlds right now. Yeah, my son just texted me and he's been trying to get to. You guys really know this.

Does he want to. Does he want to.

Does he want to hop on, we'll send him a link.

Yeah, yeah, we'll send him.

You can join right after you listening. Maybe call my phone and I'll put you up to the microphone here.

Let's do it.

Let's do it.

He's consolidating the ad department, you know, the management, the lawyering, the ad services, the distribution. He's trying to consolidate that onto a tiny little team because these things aren't necessary. All this stuff is not needed anymore. Yeah, you need an ad agency.

Yeah. This is amazing. The chat is going wild. Everyone's really happy with this. They're calling. They're calling your son, the prodigal son.

Here. I'm gonna see if I get him to call me. He said he emailed his partner named Jake emailed one of you guys.

Okay, okay. We'll have to follow up. But.

But they're having huge success. And he's the one that. He's the one that started talking about AI. He's in the middle of all of this. The tech influencers, the Google store, the TikTok store, everything. Yeah, but all of that is more efficient. More efficient. More efficient, right? I mean, and the. And what you have is the talent agencies and the ad agencies and the managerial services and the lawyers holding on. They're like going into the foxholes as opposed to adjusting and adapting and changing what it is they do. They are just insisting that things continue to be done the way that they've always been done. And it's, I guess a classic business mistake, right?

Yeah, totally. Yeah.

I have one health question for you. What are the. John and I are starting what we hope to be multiple decades run of daily live streaming. What would you have done when you were earlier in your career health wise to. To better sell. You know, you seem to be doing incredibly well now. So what are, what are the key things to look out for health wise to make sure you can do this for decades?

Be hypomanic helps. Which a lot of successful business people are.

Yes.

You're going. I hear many of the podcasts. You're going to suffer. You're going to work hard, you're going to lose sleep. I wish I'd paid more attention to sleep, but if I had, I couldn't have done most of what I did. I'm trying to pay attention to sleep now. And you know, you've heard it all before. It's. It's not. This is not new. Trust your instincts. Explore. Don't be afraid to fall down. I. For me, the, the, the big. As I look back on all the things I did, it just the willingness to improvise and to go into dangerous situations. I mean a lot of. Oh, he's calling now.

Let's get him on. We got the sun on.

I don't know if they can hear.

He can.

I'll have to translate from you put.

On speaker five phone. Hey, how's it going, guys? How you doing?

What's happening?

Obviously, but we. My business partner and I actually emailed you a couple weeks back. Okay. We rep Roberto Nixon. Oh, no way. I love Roberto. That's amazing. Okay. Yeah, we gotta get in touch. My dad was on the air. Fantastic.

I'm flying back from Seattle.

Okay.

Yeah, okay. I do. So we did have a little exchange.

Yeah, yeah, yeah. Let's follow you guys.

He's gonna keep talking. Okay, you can't. I'll tell him what you said. He can't hear you.

Okay.

Talking. Douglas.

I was going to say that I. So Rob and Jake are going to an Oasis concert next week in Pasadena.

And I was going to ask you.

If you could meet Rob in Pasadena. Okay. Yeah, his sister, also his kid. Her kids are going to poly and Douglas went to poly too.

Like you said at the beginning of the show, only famous people go to polytechnic school.

That's fantastic. No, I, I just wanted to say hi and show you that we're not like the rest of those guys that probably email you randomly asking for things and wanting to build a relationship. It's it's very funny that this all happened in a strange way. So. Yeah. This is amazing. I actually have to take a call for this. Roark Heath, who's a Gen AI creator. Cool. Because he's in Dubai and I. You know, just trying to get on the.

You got to get on with Dubai. We know. We know how that goes.

Goes.

All right. Get going. I. I call these guys because they butchered my. My training, my dot com. John, is that. Which one's John?

I'm John.

John. John was actually@doctor who.com when he was like 10 years old.

Yeah.

Yeah.

I was in the Very cold data center. Yeah. Racking servers. That's spectacular. So there's. There's a long history on. On. On all fronts.

Andy went to the.

So.

Okay. We'll talk later. Yes. Anyone to punk.

Okay. Okay. I have one more question on the. For you. For you.

Okay. Sorry.

Douglas, later. Douglas, later.

For you. Last week we had Mark Cuban on the show. He said that drinking raw milk is extremely dangerous and should never be done yet.

Is there anything to it? I drank. I'll go on the record. I drank a liter of raw milk that day. Every day. Day, for two years straight.

You were fine. Yeah. Can you explain why he didn't give any underlying rationale?

Yeah. I doubt he knows why.

He was just saying that the LLMs might convince you to drink raw milk and that might lead to some sort of doom scenario.

You can get brucellosis. You probably get tuteremia. You can get listeriosis. And we can treat that with antibiotics. No problem. But they can make you very sick and they're very rare.

Yeah.

I. I wouldn't do it. But I don't. The fact that. Look, there's something terrible going on.

Yeah.

Where people are so fearful of being the biological agents that we are and the reality that we are going to die. That they are afraid to live.

Yeah.

Living well is the goal. Not living forever. Not living perfectly free of illness. It's living a good life. And we are off of that. I can't. We are so far off that it is disgusting. And for a non physician to have an opinion about milk that contains pathogenic organisms that he's never heard of or he learned to pronounce yesterday is disturbing to me. It's the same thing was when people went after hydroxychloroquist.

When.

The day they learned how to say that word. A medicine I've been prescribing for decades. So it's all. We are so out of whack with this going to live forever. Fear of death, illness, infection. Oh, shit. Yes, we are. We, we, my generation of physicians, we walked into illnesses that had 100% fatality. AIDS had 100% fatality. And we did not know what we were dealing with.

With.

And we didn't cower in the corner. We marched in. It's the right thing to do. I don't know what's happened. I, I can't understand this at all. But here we are. We need to focus on living well, living a good life, period.

You did, you stuff comes what may. Did you predict the decline of alcohol consumption? It's.

I did not fall off a cliff.

Right, yeah, yeah, I did. That's still surprising to me. But it fits with the lack of dating and the lack of having sex and the lack of socializing. That was a prime social lubricant for decades. I'm glad to see it. It's a good thing, you know, the people are starting to understand it's a poison and it's not good for any tissue in our body ever. But it makes me also, I mean, what happens? When did we become such pussies? When did that happen? That's my question these days. When did that happen?

I don't know.

I mean, have you ever said something like that on cnn? This is why you got to stay off the networks. You just got to do your own show, I guess.

I've been through so much lately, I've just lost all inhibition. I'm a huge advocate for freedom of speech and freedom of many sorts. I'm not happy about this flag burning thing. Freedom, freedom, freedom is what I'm all about. Now he's speaking my mind.

I will pitch you one possible explanation. I think that the fear of very consequential but low probability events like the raw milk or the risk from raw milk or the risk from COVID is tied to a lack of belief in immortality and not in the sense of living forever like biological immortality. Like science will cure this and let you live forever. That's just one way to think about immortality. You can also think about immortality and your legacy. If you are written about and you have lived a great life, you will be remembered and immortalized. You can also think about it through your children and also through the afterlife. If you're spiritual or religious, you could think that you're going to heaven. And if you don't believe in any of those modes of immortality, you don't believe that you're going to have kids or do your life's work and be remembered in the afterlife or go to heaven or you don't believe that science will be able to fix you. If you do wind up getting sick from raw milk, then even a small chance has an incredible, incredible penalty. And so you discount it very, very high.

I agree with you. With a couple of caveats. I do agree with you. Embedded in that observation is a general lack of meaning making. If the meaning is, I'm trying to ascend to a afterlife, whatever the meaning is of my living, that meaning should be deeply meaningful to me and purposeful. It doesn't. It does not have to include an afterlife. It can also include just creating a good life for my children. That's why I'm here, to do that, that kind of thing. But, but we people are here for their narcissistic needs and that's when things become fragile.

Yes.

Because we are not the beginning and the end of everything. We just are not. And if we think we're all there is is what's happening to me, man. And then we have people whipping the frenzies and the fear and they're learning to control us with that. And that is disgusting.

Yeah.

So what about, have you been tracking AI psychosis at all? Any thoughts?

I hear about it, I don't believe it. I'll tell you, I'll make a bet that it's way overblown. It was somebody who was already psychotic and whatever. Not that the AI relationships are necessarily going to be good. I worry about that. But this psychotic episode, I don't know. I don't know if you remember back in the 90s, there were news stories every night.

I wasn't born, sir.

Okay, do you have to rub that in? You just said no, I don't remember.

No, no. Later 90s, I got into the action.

But there was news reports like every night. Like, oh, these parties where all the parents throw their keys in a bowl and they just, they just grab a set of keys and that's who they go home with that night.

Oh, sure, sure.

The press, the fake. I don't think people were sensitive to fake news. We have to be very sensitive to reporting these days. So much of what's being reported is fake and it's just to catch your eyes. It's just to get your attention. They, they, the person that wrote that article was a 23 year old segment producer somewhere. Somewhere who doesn't do any research of any meaning. It just becomes something that they catch on the line. They saw other people report it. They report it. It's ridiculous.

Yeah, I Mean, my read on it is, it seems obvious now that if a large number of people take ayahuasca, some of them are going to have some type of psychotic break of sorts. And maybe they were prone to or had some underlying issue that enabled that. But the issue with.

You're right, they already had a psychotic illness and they just happened to break when they're working with AI. But you're making a very smart observation that AI world is populated by people that microdose on acid and do ayahuasca, which, I tell you, it categorically causes severe psychiatric problems. I've seen it my entire career. Scares the hell out of me. They should not be doing that.

If you're listening, did you ever consider. Yeah. If you're listening live from Burning man, just listen to Dr. Drew. Did you ever go to Burning man, by the way?

No. We got friends keep trying to get us to go. It's not. It's not my jam exactly.

Well, you could go there and try to. Try to, you know, talk people out of it.

How about we stick to the Bud Light, buddy?

Yeah, let's stick to the crushing beard. Cheers.

Have a couple glasses of wine. Anyway, this has been fantastic.

Thank you for joining the Record. Come back on anytime.

We appreciate this. We'd love to have. You guys are great.

I. I learned something just listening to you guys, this. Talking about the playing card, the baseball cards, that was fast. And you guys have a great. You're obviously extremely well trained in. In your. In your respective fields. And it's very interesting to hear you talk about these various markets and opportunities and things. And I leave with one caveat.

Please.

If you don't call my son, he's going to kill me.

We will definitely.

We're going to. We'll go to this concert with him.

We will. We will. Exactly.

It's in Pasadena.

I live in Pasadena now.

You live there now?

I do. I live over Rose. Rose is literally walking distance for me. So do I. Amazing.

There we go.

Okay, we should.

Did you guys just become best friends?

My address. I'll swing file for you. I'll bring you 30 rack of both.

We live by Annandale.

Oh, okay. Yeah, I'm right over there. Okay. So just up La Vista.

No excuse.

I don't want to get too. I don't want to get too. Too precise. Show up with people at my front door. Anyway, thank you so much for hopping on. This is fantastic.

Great hanging.

We will talk to you.

Cheers.

Bye. Massive news from SpaceX last night.

They did it.

They did it Flight 10 made it back. Took off from Starbase South Texas. The booster landed in the ocean in the I think the Gulf of America.

Technically that's absolutely right.

And the actual starship executed a successful flip maneuver. Deployed a mock payload of a bunch of non functional Starlink satellites. Survived re entry just barely as we'll see. It was a really dramatic video. It was amazing. And then splashdown on target in the Indian Ocean.

It was a full send.

It was a full send. It was a crazy. Crazy.

NASA could never watch.

Yeah. Let's watch the recap video that the Wall Street Journal put together. This is pretty interesting. Starbase Texas. This is yesterday. They scrapped two attempts on Monday and Tuesday because of some problems with the vehicle. But they got it off the ground. Look at that. They lit the candle. Stunning go into space.

So I wish we could get a better sense for just how massive it is.

Yeah. Those angles and so that. Those are the dummy Starlink satellites. The dummy.

That little motor conveyor belt on the left.

Yeah. Just the number of things that have to go right to actually release something from this rocket. Insane. And then this is the crazy part. There's just a bunch of different. Where did the stuff come from?

Just take a hit. We clearly didn't need it.

You would think that as soon as I saw I was like okay, it's over. The whole thing's gonna blow. For sure. It does. It definitely doesn't make it back because if it's like losing parts, like every part should be important. Right. Like what's going on here. And so. And they're also. The whole time they were like testing the. The flaps like really pushing them to the limits. Going farther. There it is. Splashing down.

Yeah. You were mentioning earlier. There's a sound bite of them saying they were. They were.

They were going further than they needed to. So they were doing things like. Like okay, let. Let's final moment. And then boom.

And then the convenient cut. You would have thought the Journal and the legacy media would have let that.

Yes. Yes.

A little bit longer. The massive explosion.

Yeah. I mean the vibes. The vibes going into this were rough. Honestly. Lots of people with. With the Elon's been distracted by politics. Take lots of people with the Elon too focused on AI romantic companions. Take. We covered that.

You can imagine the conversation between Elon and Ani yesterday right before the launch. You got this babe.

I mean you know that Ani apparently allegedly the original ANI romantic companion model runs on the non reasoning model. Just Grok3 I guess just Pure love. Pure love. And if there's any evidence out there in the just market of AI chatting and companions is that you don't need a reasoning model when you are chatting with a romantic companion. So a lot of like the backlash to the GPT5 launch was something like, you know, people were using it, not just a romantic companion, but just as like a life coach, somebody to talk to. It was very conversational and that quick back and forth was what people actually enjoyed. They liked the tone, they didn't care that it wasn't, you know, incredibly good at solving hard math problems or like the IMO or whatever. What you got for me, Tyler?

I think there's also something to be said for like reasoning models. Kind of mess with the vibes.

Right.

It's like the music thing where.

Yeah, yeah.

Sometimes you want a friend that's not gonna think too hard. They're just gonna.

Yeah, yeah, yeah.

In the musical like taste thing.

Yep.

All the reasoning models gave like these weird answers because they would like subtly prefer, you know, artist names with numbers like that.

Yep. Although, I mean, I think the reasoning models actually had the best taste of all. But that's a bit of a hot take.

But we got to pull up this post from Red Bull Futurist. Very important, he says. Super heavy. The effing goat. Wow. And I just needed to highlight this because obviously Red Bull, some of Red Bull futurists work actually, actually has into this. Yeah, of course.

Amazing.

So absolute legend. A win for Red Bull. Really?

For sure. For sure. Yeah.

It's actually surprising that. That Red Bull and SpaceX haven't tried to collab yet. You'd think that Red Bull would just be like, we'll give you millions of dollars if you just put Red Bull branding over this. Why not? It'd be good. It'd be good for both parties.

Even the explosions feel like on brand for Red Bull. Red Bull's down for the crazy risk taking.

I could see Elon going with White Monster.

Really should do that. I mean, advertising is special and maybe you don't want to dilute that. Are you.

Would you go so far to say the White Monster brand isn't special?

Would you say, I guess it would.

Be added Red Bull.

It would be added special. Yeah. They. The reason I was bringing up the reasoning models was because apparently Elon wanted Ani to use the reasoning model. The AI companion has to be able to do the hard math problems, which is funny. So maybe she really was in use doing rocket science and calculating the last final decisions before this Rocket went out, but it was a huge success. The Wall Street Journal has kind of the play by play here. SpaceX pulled off a smoother test of its Starship rocket, managing a more complete mission after setbacks earlier this year. The Starship spacecraft flew through space after launching from the company South Texas complex Tuesday around 7:30pm ET. The vehicle successfully deployed a batch of dummy Starlink satellites and reentered Earth's orbit, facing intense heat and forces before splashing down in the Indian Ocean. This is the 10th launch of Starship. I believe this was the. This was ship like 37 or something. They've built a lot of these. Not all of them have launched. Some of them have been scrapped. Some of them blew up in the test stand. Like they really push these things super hard. So it's a 403 foot tall rocket. They started testing this in 2023. There's been a series of explosions, mishaps, previous test flights that have been cut short. Elon Musk has much riding on the rocket, envisioned to one day carry satellites, scientific devices, and eventually astronauts.

Just to put this into context, the White house house is 70ft tall.

Wow.

So this is.

Yeah, it's like the size of the. Isn't it closer to the Statue of Liberty? I think it's like around that tall. 403ft. I'll have to look that up.

The Statue of Liberty is 305ft.

Oh, mogged Mog. Absolutely. An extra 50ft on that. For now, the company is pushing to show it can consistently fly Starship and experiment with its design. Space SpaceX set up Tuesday's mission to stress test parts of the Starship spacecraft. We certainly saw that on display with the parts flying all over the place. Seeking to give engineers information to continue developing the vehicle, basically the calculus here is like, how cheap can you make this thing? If you use duct tape, will that work? If you use tinfoil, will that work? They really are pushing these things crazy, crazy hard.

I think the other way to put this into context, not everybody is fortunate to be able to build and launch rockets for a living. But anybody that's built software knows that even if you're launching a relatively simple feature, it'll oftentimes break and have issues and bugs and things like that. And it's a little bit, you have a little bit more leeway to ship stuff and make changes on the fly. In this case, they're doing it in this incredibly public setting where the Internet is going to have a very strong reaction one way or another. So the pressure is just Insane.

So Musk wants both the Starship booster and spacecraft to be fully and rapidly reusable, more akin to an airplane than a traditional rocket. SpaceX has made major strides with reusability with its workhorse Falcon 9 rockets, which are powered by boosters that can be used many times. SpaceX faces self imposed and external deadlines with the much larger Starship. Musk wants to launch an uncrewed version of the vehicle to Mars next year, but has said meeting that goal will be tough. Of course there's a Mars transfer window that only comes up I think every 18 months or so. So it's really critical to hit it in 2026 or else you got to wait till 2028. I believe in 2027 a lander variant of Starship is supposed to be ready to carry astronauts on a NASA moon mission through the agency's Artemis exploration program. That's going to be really hard because I think that have to refuel in orbit and then also make it safe enough that astronauts can fly on it. Like they have a lot to do there.

This is why we need to get ANI to be able to solve complex physics.

For sure. For sure. Today we are talking about Labubus and the story of Pop Mart, which to me really stands out as a similar. Like in the dot com boom, there was this. The Beanie Babies went on a similar run. Incredibly popular, built on the back of dot com technology. I remember going over to a friend's house and loading the beaniebabies.com website and it was so heavy because it had all these images.

Did it take like minutes to load?

It took minutes to load because they like whoever built the website just didn't kind of think about how long it would take.

But even then it was like this is so cool. Yeah, takes 30 minutes. Minutes to go to the store.

Exactly. Oh, if it takes 5 minutes to load all down. And so yeah, the page would load, the HTML would load and then slowly one image after another would load in and you could really feel the difference at the time many people were on dial up, which was 56k, which is like a staggeringly slow speed compared to what you get even just on like a plane. And then DSL was one level up.

Posted that United has Starlink now.

Yeah. And I think it's 300 megs per second. 300 megs. So that's what, 6,000 times faster than what we were experiencing back in like the mid 90s.

Yeah.

And so then you could upgrade to DSL. DSL was between 256k and 1.5 megs. I had a friend who had a T1 line which was like enterprise level Internet in the 90s was one meg up and down. So you could get equal upload, symmetrical line. He could load the Beanie Baby website faster than anyone. It was like true status symbol at the time. Yeah, it was alpha. His parents were very successful.

What was the most expensive Beanie Baby transaction ever? Do you know?

I don't know. I do know that prices peaked throughout. Just. They perfectly track the dot com boom in 1998. In 2008, Ty, which is Ty Warner, his company is called Ty Ty. They make Beanie Babies. They made $1.4 billion in sales, making it one of the fastest growing toy companies in history. Two years later, the market crashed almost overnight. Prices on the secondary market plummeted as supply overwhelmed demand and speculative buyers exited. So people were in the habit of getting. Yes, interesting. The chat is correct. Ebay was a major, major driver of Beanie Baby's growth because people could buy them. And then the secondary market was way more liquid than ever before before. It was like, okay, if you buy some rare drop or some limited edition thing and you want to go sell it, you have to go to like a trade show that maybe happens every once in a. Once a year. You have to find maybe your local shop, but there's not that much liquidity. Remember when we were talking to our friend about the collectible card market, Beatles memorabilia? He was saying, like, I only need two buyers. It's very easy to find two buyers if you're interacting at Internet scale. It's harder if you're in some town and you have a rare Beanie Baby and you need to see, are there any other crazy Beanie Baby fans in this town? So ebay was a huge. Yeah, Beanie Babies, the original or unicorn startup, essentially. I mean, it was an overnight success in the sense that I think the business was going for about a decade before the boom, but they rode the wave of the Internet.

Interestingly, most expensive Labubu ever sold was 170,000 in June of this year. And the most expensive Beanie Baby ever sold was something around half a million dollars.

Half a million dollars. So we got room to run. We got room to run in the Labubu market. So my question's like, what is driving the Labubu? Yeah. Enjoy your victory lap. Get. Get out there, get some exercise, do some push ups. Halfway through the lap.

Aidan.

Enjoy Beltsky.

Did we say that right?

Beltsky's.

Yes. Beltsky's you said your full name now. Here we go.

Thanks for watching. Yeah. So Labu, clearly, clearly a beneficiary of the social media boom of TikTok, of the unboxing culture, Temu cult live shop culture, flex culture, because people put them.

On, you know, their purse.

Interestingly not. Even though it's like. It's like money is cheap right now. Everything is going up into the. Right. The market is booming. Yeah. I can't really find a bridge between, like, the AI boom and Labubus. It seems like it's just the social media boom that we're continuing to see the.

Yeah, it's the fart coins. The Labubus.

Yes, yes, yes. Yeah, there's a little bit of that. There's a little bit of. Just like gambling culture has infiltrated everything from sports betting, obviously is legal in more states and has been on a tear for a long time to folks big gambling on crypto and stocks and out of the money options all the way to the collector culture on all sorts of different platforms. Like, there's a big. There's just a broad boom happening here. And then there's also the China angle, which I think is interesting. We were talking about this yesterday, that China hasn't had a major cultural export, and this might be sort of the first one, more or less like, TikTok counts in some ways. But TikTok, I see it as like a bucket that fills up with the local culture of the people that open the app. Like, if you're in. You're in la. You see LA when you go. Yeah, exactly. But you can certainly access that if you wind up in that filter, if you search the right keywords and then you can go there. Yeah, yeah. Same with Instagram. But by default, I don't see TikTok as like a uniquely. A uniquely Chinese cultural export.

It's an export, not a cultural export.

It's a technology. It's technology. And. And of course, like, China has been exporting, like, manufacturing technology and manufacturing prowess for a long time and so.

So got a real win with the demon dolls.

They do look crazy, right? I just. I don't like them. They just rub me the wrong way. I don't know, something is weird, but I'm just not into it. I don't know.

That's why we bought one for Bill Bishop's dog. We're excited for Toshi to rip it apart.

Rip it apart? Yes. It feels. It just. It's not a good look. I don't like the aesthetics of the. It's Very odd.

I would not buy one for my child.

The bigger question that I have that I think we want to answer, so we're going to dig into the history of Pop Mart, take you through some of the history of Labubus. The question that I have is like the horses out of the stable with gambling on toys. Clearly think about the TikTok story. There was a big discussion, nationwide discussion a few years ago, should we ban TikTok? Is it spyware? Is it influencing our culture? Is it causing brain rot? Where did we land on that? As America, we said, yeah, it's fine, we're good. The answer was YouTube will compete in shorts and Instagram will compete in reels. And you know, TikTok will be out there and you know, buyer beware. Like, you know what you're using and you're an American, you're free person. And if you want to use that app, you can. And if you want to come over to a different app and you trust.

Mark Zuckerberg stated version preference, people are like, I just want to follow my friends.

Yep.

The, you know, feeds that are algo driven get used more.

And so my, my pitch and what I'm, what I'm kind of digging into what I wrote about in the newsletter this morning. You should subscribe at substack to Our substack substack tbpn.substack.com is is the conclusion to the TikTok debate was the YouTube team and the Instagram team need to launch direct competitors and take it very seriously. And Mark Zuckerberg invested like tens of billions of dollars I think in like data center build out to actually support reels and the algo feeds. And they took it really seriously and they executed very well. So what's the conclusion to the Lububu story? Well, it's probably like Ty, the maker of Beanie Babies or Mattel, the maker of Barbie, has to get getting into blind boxes. Like, that's the only answer that, that's the where the, like the arrow of progress moves.

Children want to gamble.

They want to gamble. And so I think that that's the end state here. And I'm just, that's the situation that I'm monitoring. I'm not holding my breath being like, oh yeah, Labubus are going away anytime soon. Yeah, sure, there might be like a bubble and then it subsides. But in general, I think that the future is like more mystery boxes under the Christmas tree. Generally broadly in American culture, like, we love gambling, we love freedom. Pick your poison.

That's Somebody gamble. Gambling as a gift is crazy. I buy you this blind box.

You never give someone scratchers. Give someone scratchers. It's great.

We should give the team scratchers. Send them off into their three day weekend. Everybody.

I'm into scratchers. I had a friend in college who was into scratchers. Really, you know, the thrill of a scratcher. I bought one lot of ticket in my life and it was electric. I was like, I'm gonna win. Like this is gonna happen. And then it didn't. And I was like, that's okay. I'm never spending $2 ever again on that. But anyway, this is what happened with video games. They went free to play. Plus microtransactions. The whales drive everything. Price discrimination and everything. We see this with OnlyFans. We see this with the future of romantic companions. Price discrimination is key and this will probably unlock some of that. It'll be interesting to see where it goes. But I think if you're a toy maker, you got to get into mystery boxes. Unfortunately. Maybe, Maybe unfortunately. But like that's where the, that's where the culture's moved.

Late stage capitalism, pretty much. Which I would say we're just getting started.

Pretty much. Anyway, let's go through. Brandon Gorell has a fantastic thread on, on Pop Mart and Tyler has the, the story here.

History.

Do you want to take us through the history? History? Yeah. What you got for us?

Can we pull this up on vhs? Ben, I think this is, this is.

Going to be important. There we go.

There we go.

Yeah.

So I think we should.

I just love the way this looks. I can't help it.

Okay, let's first go through some big, big numbers here. So Pop Mart, public company currently at what, like around 55 billion.

Yes. Hong Kong Nang is now the 10th richest person in China. He's worth $28 billion. Pretty, pretty crazy.

Credit is due.

And a lot of these, a lot of the data sources here are Chinese. And we tried to double check everything by translating, but there might be some details that are wrong. So, you know.

Okay, so yeah, they have almost 600 retail stores, 2500 vending machines. Revenues at 1.8 billion.

Vending machines. That's.

Yeah, that's really the big thing. That was big. It kind of. So the kind of main story of Pop Mart is that they basically took a lot of things that were first in Japan and then brought them to China and then exported them basically worldwide.

Yeah.

But yet the revenue is 106% growth year over year, and then 700 million of that is just overseas.

Yeah. The stat was crazy. I think in the first half of this year they beat last year's total revenue.

Yeah.

And they're already like a scale pretty huge company.

Is that good?

It's. I think it's better than Nvidia. It's the backbone of the economy. Okay. So take some of these things.

So 2010.

Yeah.

In Beijing. Wang Ning starts it originally. Basically it's just like retail store for these little collectibles.

Yeah.

They don't. There's a bunch of stores that do like license other people's ip. So there's like, I think they originally started with some Marvel.

Yeah.

But then really, I mean the majority of the revenue is just from like their custom IP that they basically license from artists they find.

Yeah. So that's the nature of like Pop Mart. Like it's like pop culture market. And Brandon says a single variety mall store. Think Spencer's are hot topic. Couldn't get, they couldn't get investment at the time because no one thought adult toys would work. Now he's the 10th.

And when Wang was growing up, his parents ran small shops. So in the DNA family.

Okay.

Yeah.

So then 2014, this is when they basically bring over these sunny angels. These are the Japanese like figurines.

Yep.

And this is when they start the blind boxes. This is like really the main thing that spurs the rest of their growth.

Yep.

20.

Wait, wait, before this. This is, this is actually crazy. Brandon has some extra context here. So starts the company in 2010, a year out of college. He had an undergraduate degree in advertising and a short stint at the Chinese version of Twitter. His single variety store in Beijing, in a Beijing mall. It's essentially a reseller. He's seven employees. Spends two years selling third party stuff on thin margins, trying to scale with debt. But it's hard to finance because investors don't get selling toys to adults. He manages to raise $320,000 equivalent equivalent in R&B. And then $1 million around there in 2013, which he opens to use. Which he uses to open three new mall shops. And then in 2014 he hits his first lick, finds a repeatable format blind boxes. So take us into that.

Okay, so then, so they start with that. These are still different figurines from Japan.

Yeah. These Sonny angel blind boxes. They look kind of like 90s troll design dolls. Interesting. Yeah.

And then.

Yeah. And I don't think we already we covered specifically what a blind box is. It's. You're going in, you're, you're Paying a generic price for something and you have no idea what's in it. It could be the super generic one of, you know, 100,000 item, or it could be ultra, ultra limited. And so you just get this massive buyers get this massive dopamine rush when they're buying it, they're paying and that whatever item they unpack might immediately be worth like some significant multiple of what they paid.

Yep. So kind of like angel investing.

So it has, it has, yeah, but, but way more condensed. It's like I buy this and then I immediately figure out am I, am I going to get put a hundred.

Thousand dollars in turn 10 cap.

But unlike angel investing, I think there's like a floor. Right. Angel investing easily go to zero. Labubu is like have, you know, somewhat stable.

Yeah.

Like it has some market value.

So if you're trying to like gamble less and you're addicted to angel investing, maybe you know, downgrade to just Labubu boxes.

A big attraction of especially the Labu's, which you can get into later, is like they have like these sets that come out. So it'll be like.

And you would collect the full set.

Yeah, it's like 10. And then they're basically all the same except like the color of the fur is slightly different or something. But then.

So people are trying to create a complete set which will then sell for more.

Yeah, but Obviously if there's 10, you can't just buy 10 of the boxes because you're probably not going to get all of them. So you have to buy.

Do you think that Porsche should get into blind boxes? Imagine if you just imagine if like a 9, you could just buy 911s, only with blind boxes. It's like 200k. You might just get a bait. You might get a Carrera T, like super base model. You might get a GT3RS.

You might get an ST. Wow. Yeah, there might be something there. I don't know.

I mean people would be. People would be sending it on those.

I think so. Yeah. I mean. And you just work out the expected value. Right. So you charge whatever the, the expected value is. There isn't quite enough of a Delta. They need to throw in like a career Carrera GT as well. A few of those as well.

Used to see a similar thing in the sneaker market when that was like a really big thing. On ebay you would see these like a third party, like mystery boxes.

Oh, ebay would just do it. Interesting.

It wasn't.

People wanted to sell it.

But that's crazy because that's even like less regulated because they can just totally like cook the box versus, like a real company that has probably some sort of oversight.

Yeah. I mean, you don't really know how many people were actually buying it. It was just like for YouTube that they would make the videos like, oh, I bought this $500 mystery box.

I remember I bought a mystery box of cords on a woot.com, which was an electronics reseller that was bought by Amazon.

And that's so Coogan Coke. It's incredible box.

Of course, it was just electronics. Electronics. It was like so woot.com would go around and find like, like a bunch of electronics that have been discounted. I bought a. I bought an HD projector that was probably like three grand for like 600 bucks because, like they were like going out of stock and they just needed to like liquidate. And so we would go and buy the liquidation and then put it on the website and you could just buy it, but it was limited time. They would just do one daily deal every day. And one day they just did a mystery box and you could just buy. It would just baby, like, literally like whatever was in their facility, they would just pop back like. Like pack up for you. And who knows? I got like, oh, this is like HDMI to DVI cable or something.

You can probably trace back something like. Do you remember Storage wars? The show?

Yeah, yeah.

They open it, you can't go in, but you can just see the front. And then you try to estimate the value.

Yeah.

And then. Yeah, there's probably some lineage there.

That's great.

So when did China figure out that this was gambling? Because they banned the sale of the Boo boo to kids under 8 years old. Yeah, but that still means you got 10 years before you're legally adult here in the US at least. Where. Yeah. Also gambling.

I don't know how many like actual 8 year olds are going to the store and buying and it's not their parents.

Yeah.

So it's kind of unclear.

Well, if you're worried about your employees gambling with your company funds, get on ramp.com Time is money. Save both easy use corporate cards, bill payments, accounting, and a whole lot more all in one place. Very easy to set a rule in Ramp. No pop, no Labubu, no pop Mark. Anyway, continue.

Okay, so let's go back.

So.

So 2015 is when Lulibubu first appears as it's in a picture book. So this has nothing to do with popmart. It's just this other artist, Kai Singh lung. And then 2016, this is Pop Mart's first like kind of real IP that they created that like went super viral.

Yes. Ning site. In 2016, Ning tries something new. He flies to Hong Kong and meets with artist Kenny Wong, who had created the trendy toy Figurine Molly in 2006 and was a big designer in the toy niche there. He negotiates exclusive. An exclusive license with Wong to develop and sell Molly products and blind boxes. Interesting.

So I think this was. It's done around 800 million in revenue.

Whoa.

Since 2016.

So selling Molly not only gives Ning more control and capitalizes on trendy toy plus blind box signal, but it capitalizes on Kenny Wong's fan base and leads Ning to his next big unlock. Betting big on controlling existing toy IP with a built in fan base instead of selling third party. So in 2017, sales of Molly are going nuts. Total 22 million by end of year For Molly, Pop Mart rolls out vending machines, reducing rent they had to pay in malls and establishing way deeper reach with fandom. Company begins repeating.

Great.

It's replicating the Molly unregulated slot machines, basically.

And then they. Pocky. Pucky is another Hong Kong artist derivative that they launch. And then they launch a Seder. You know, it's like half. Half like goat legs, which is very odd. They're getting.

Not beating the Antichrist allegations.

Yes. If you've been at the PT lectures in SF for who the Antichrist is. I think we got a lead here. I think we got a lead. Did you already write that?

Yeah, that was already there.

Yeah. You already wrote that?

Yeah, many. There's a lot of allegations here. I mean, it's unclear whether. You know what the original.

I think we solved it, folks. Yeah, we've solved it. Is there really a star on them? Is that.

No, I just.

The pentagram.

Okay, well, that's why.

Yeah.

Question mark.

Max over in the substack chat says we need to tokenize the Labubus. I think that's.

I think that's how that's obvious happening next. We know that's going to happen. We know that's going to happen. CS go loot boxes walked so Labubu could run.

Brandon. Brandon in the X chat says we got to get a bezel box going. Totally agree, Quaid. Let's get some. Let's get some blind boxes going. You might. You might get a Nautilus. You might get a Tudor.

Yeah, there you go. There you go. Okay, so where are we?

Okay, so now 2019 Labubu is then licensed to Pop Mart.

Yep. So just in. In 2018, right before this, sales spiked to 73 million on the back of Molly. Around this time, Pop Mar Walmart builds its own in house design team, the Pop Design Center. Like a Porsche design center, it becomes a powerful pipeline alongside ever more exclusive artist licenses and big non exclusive entertainment licenses. If you want to entertain people on a stream, get on restream 1, livestream 30 plus destinations, multi stream and reach your audience wherever they are. Continue.

Okay, so they license in 2019, but they don't actually release like the modern Libabu do until 2023 in the book or whatever.

Yeah, so they're starting to build the lore, build the ip.

They do characters, they do little figurines, but it's not like the kind of modern instantiation. So then let's go to 2020. They IPO at 7 billion in Hong Kong. And then.

Wait, hold on. So continuing with Brandon 2019, Pop Mart begins selling Labubu Blind Box as an exclusive deal with artist Ka Singh Long, Labubu's original character in Lung's picture book trilogy called the Monsters, but was selling his figurines in Hong Kong by 2015. At time of the deal, it's only popular among niche toy collectors. And we do have some images in the deck. By the way, guys, if you want to pull up the pictures of these. These monsters. Yeah. If you scroll down a bunch, there are some photos of the Labubus. It has like kind of a street art vibe. Very chaotic drawings. Keep going. There's one more. Keep going. One more. Keep going. That's Molly. That's the first Labubu the Monsters trilogy by Ka Sing Lung. The story of Puka Pato and the Girl Miro's Requiem. And so these start selling in 2019 and 2020. Pop Mart raises $100 million on a $2.5 billion valuation. Hit the gong. I see a large up here. And a few months later, later, IPOs in Hong Kong stock rips 80% on open day. Opening day. You thought Meme stocks were just an American phenomenon. Meme stocks are a worldwide phenomenon's net worth doubles overnight. He's worth 3.2 billion at open, 6 billion at close. Pobmart has a 12.5 billion market cap at close. That's a big company. That's a big company. So let's continue.

Okay, so 2023 is when the Blind Box Labu like phenomenon really takes off. This is, I think probably it's mostly due to TikTok. You see a Lot of this and then. Yeah, 20, 25. Right now it's like around 55 billion.

Now it's. Now it's at 55. Absolutely incredible. What a run. Should we pull up the Wall Street Journal video, Watch some of that? What do you think?

Yeah, let's do it.

While they're pulling that up, let's tell you about figma.com, think bigger, build faster. Figma helps design and development teams build great products together. Folks. Get to figma.com design your next Lebooboo drop.

Yeah. I mean, developing real IP this quickly is incredibly impressive.

Yeah, yeah.

IP that can do billions of.

Yeah. I mean, it just takes so long. I remember learning about the Lucasfilm acquisition that Disney did, even the Marvel acquisition. This is. These are like, they were big acquisitions at the time, but like single digit billions, low double digit billions.

Yeah.

Like, and then they just created so much value as they actually monetized the IP and created like shows and merch and like ran the Disney machine around it.

Yeah.

Seems like Pop Mart's capable of running like a Disney Ask monetization playbook on top of somewhat new ip, which is pretty crazy. Anyway, let's pull up the Wall Street Journal video and watch a bit of that. Aiden says it's nightmare fuel. I agree. Whenever Chinese retailer popmart drops a new.

Labubu designer, it sells out within minutes.

Insufficient stock. It does seem like hard to get toys. It's truly like a worldwide phenomenon in a sense. Like customers. It's not just women that are doing it. It's not just men. It's like it's really people all.

Not just adults. It's children.

Children, playgrounds. Yeah, yeah, you would think it's like, oh, it's just kids. So, yeah. Their revenue double boxings have flooded social media. Fans flock overseas to buy exclusive products. I mean, it just has the natural dangling off of celebrities. Look at Madonna promoting it.

Pop Mart everywhere.

But can the company continue to grow beyond this viral moment that has seen its share prices rocket more than 1,200%? Ripper here, posit. So economics up the.

Are you rooting for their downfall?

Preying on it? Even the. I don't know. I think, I think the bigger question is like, there's something that. So it's easy to say, like these go viral on social media. Like it's a beneficiary of social media. But like, if you actually think about why is. And why is a Labubu more viral than, you know, the latest iteration of Barbie or Beanie Babies, like there is a reason, and it's directly related to the nature of the algorithm. So when you do an unboxing, it naturally takes about one minute if you edit it down to do it. And the reveal comes at the end. So when you watch it, you say, oh, someone's doing an unboxing. They're introducing what the stakes are. It hasn't gotten.

It's good for the creator because they get that retention.

Exactly. It drives retention because it has a natural storyline of like, okay, how did I get this box? How much did I pay for it? What are my expectations? Do I have something on the line? Maybe? I'm hoping to build the set. Right. I want to build a set. I really am hoping for the red one or whatever. And then you're taken on this journey. And I believe when they unbox them, there's like two stages to the unboxing. You take it out of the box. Box. And then there's packages tied.

Yes.

So there's a box.

The third stage is when you have.

Your dog rip its head off and see what's inside. What was this?

So there's the box, then there's like a nice, like, opening. Like, you, like, rip it. It's, like, nicely packaged. And then inside there, there's a little bag. And then inside the bag is the actual.

Yeah, yeah, yeah. So. So even that, like, lends itself to, like, keeping you engaged for 60 seconds, which is going to drive more virality in the. In the feed.

Aaron Frank, partner at Lightspeed, says, I have the largest single collection of Labubus in America. No, I'm kidding. He texted me and said, this is hard to watch.

This is hard to watch.

So sorry we're forcing you to sit through this. Aaron.

Let's play a little bit more of the journal video.

Yeah, let's pull it back up.

Yeah, keep going. Of pop Mark.

Entrepreneur Lawrence in the chat says, my startup has done 75 million in unboxings. Say more.

Yeah. Elaborate. 2019, over 70% of Tamagotchi. For real. Should come back AI powered Tamagotchi. That's a good business. What we've done is just added our own flavor to that. Yeah. Now the company has more than 500. Look at how international Southeast Asia, when you decide to splurge on a Popmart blind box, which could cost around 20 to $30, you don't go in totally blind. Take this collection. There are six possible characters you could unbox, and the secret one that you have a 1 in 72 chance. One of the things that the brand can do to keep engagement, to encourage consumers to get a little more excitement out of it is to label the box. This one says have a seat. People throw the satanic panic around a lot. Like white monster monster energy drink. There's like a whole 666. It's satanic. But it's always unclear if it's like the. The founders are. Are like poking fun at Satanism. Like, like no one accuses like John Carmack of being satanic by. I mean, I guess people did when he was release Doom, but in Doom it's like you're clearly playing as a, as a mortal, like killing the demons. And that's the name of that. That's the, that's the virtue of the game.

Aaron just sent me the. The stock chart for Build a Bear. Have you seen.

Oh yeah. Build A Bear is ripping too. Does Build A Bear have loot boxes yet? That could be the next unlock.

Build A Bear is up.

It's outperforming Nvidia I believe 473% over the past five years. It's absolutely ripping. Who's clapping?

Build A Bear blind boxes. No more building. Just. Just gambling. Children just come in, come into the store.

Yeah, yeah. If Labuu is like the slot machine that you could be pull out of the. The vending machine, Build A Bear should turn it into like a game of like high stakes.

Has anybody done like remote Labubu openings? So it's just actually like.

I think I've seen that. Yeah. Who was it? Blake Robbins posts about this a lot how they. There's like apps in the app store that are.

Oh, it's probably happening on like whatnot, to be honest.

Well, have you seen the claw game? So there is an app that you can download and you can pay real money to use a claw in the real world to pick something out of a, out of a, you know, a machine or like a bucket. And whatever you pick out, you get to keep and they will mail it to you. And so it's not technically gambling. Somehow they got some like loophole there.

Very, very right now on whatnot. There's like seemingly hundreds of streams selling Labubus.

Wow. Don't gamble, folks. Don't gamble on compliance. Get on Vanta Automated Compliance, Managed Risk. Prove Trust continuously. Vanta's trust management platform takes the manual work out of your security and compliance process and replaces it with continuous automation, whether you're pursuing your first framework or managing a complex program. Anyway, the last two years of. What's interesting is the last two years of sales of Labubu have been heavily driven by international expansion. They've definitely figured out how to take the brand abroad. It was predominantly growing in mainland China, and I believe it's still growing, it's doubling in China, but it's also seen maybe like a 10x increase in international sales over the last two years. So it's on a tear, it's on its hair. We'll see how people respond. We'll see how the American toy companies respond. I feel like this is like the horse has left the stable, the cow has left the barn, the dog has left the dog.

The children yearn for the slots.

They do. They're going to figure out how to gamble one way or another. I mean, what's the alternative? Like ban Labu. Boo.

Erewhon. Blind boxes. Combo plates?

Yeah, combo.

You might just get the worst slop bowl of your life. How about sweet green blind box?

Or you get 12 ounces of blue.

You might get a bunch of steak, you might get a bunch of kale.

You might get some caviar.

Never know.